1.3. What are business plans needed for?

Seperation of ownership and corporate governance

In a business succession, ownership and management can also be separated. Without changing ownership, the management can be taken over by the successor. The option of legal separation can be undertaken by a sole proprietor in the same way as by a corporation. The separation of ownership and management is often the case with corporations. What is meant is the following:

• An owner (proprietor) appoints a managing director who runs the business as a manager. In return, the manager receives a salary with a performance-related commission. The owner does not take action himself, although he could legally do so.
• A limited liability company (GmbH) must appoint the managing director as a body according to company law (Commercial Code and GmbH Act). This can be an external managing director who is paid for this. If the shareholder also takes over the management of his company, he becomes a "managing shareholder".
• An owner can also have his business run by a "third party" in return for a lease or annuity.

In all cases, professional management by competent managers is sought as a solution.

The manager acts as an entrepreneur on behalf of the owner.