Affiliate

An affiliate is a person or organization that is officially attached to or connected with a larger organization. In business, the term describes entities that have a relationship of ownership, control, or affiliation with another entity while remaining separate legal entities. The exact definition varies by jurisdiction, but generally an affiliate is related through equity ownership or contractual arrangement and is not necessarily a subsidiary.

In corporate structures, affiliates may operate as part of a group with shared branding, resources, or strategic objectives. They can be partially owned by another company, or share common ownership through a parent entity, yet retain a distinct management, operations, and legal status. Relationships can arise from cross-ownership, joint ventures, or distribution and licensing arrangements.

Affiliate marketing is a widely used form of performance marketing in which a business rewards individuals or other businesses (affiliates) for driving traffic or sales. Affiliates promote products through links, banners, or codes, and merchants pay commissions based on agreed models such as pay per sale, pay per lead, or pay per click. Affiliate programs are often administered through networks that track referrals and manage payments.

Legal and regulatory considerations include disclosure requirements, contract terms, and compliance with advertising and consumer protection laws. Tax treatment and corporate governance considerations may apply for affiliated entities, particularly where ownership stakes and control thresholds determine regulatory status.

Related concepts include parent companies, subsidiaries, joint ventures, franchising, and referral marketing.