Hierarchy

A hierarchy (from the Greek ἱεραρχία hierarchia, "rule of a high priest", from ἱεράρχης hierarkhes, "leader of sacred rites") is an arrangement of items (objects, names, values, categories, etc.) in which the items are represented as being "above," "below," or "at the same level as" one another.

A hierarchy (sometimes abbreviated HR) can link entities either directly or indirectly, and either vertically or diagonally. The only direct links in a hierarchy, insofar as they are hierarchical, are to one's immediate superior or to one of one's subordinates, although a system that is largely hierarchical can also incorporate alternative hierarchies. Indirect hierarchical links can extend "vertically" upwards or downwards via multiple links in the same direction, following a path. All parts of the hierarchy which are not linked vertically to one another nevertheless can be "horizontally" linked through a path by traveling up the hierarchy to find a common direct or indirect superior, and then down again. This is akin to two co-workers or colleagues; each reports to a common superior, but they have the same relative amount of authority. Organizational forms exist that are both alternative and complementary to hierarchy. Heterarchy (sometimes abbreviated HT) is one such form.

Subordination (finance)

Subordination in banking and finance refers to the order of priorities in claims for ownership or interest in various assets.

United States law

Subordination of debt

Subordination is the process by which a creditor is placed in a lower priority for the collection of its debt from its debtor's assets than the priority the creditor previously had, In common parlance, the debt is said to be subordinated but in reality, it is the right of the creditor to collect the debt that has been reduced in priority. The priority of right to collect the debt is important when a debtor owes more than one creditor but has assets of insufficient value to pay them all in full at the time of a default. Except in bankruptcy proceedings, the creditor with the first priority for collection will have the first claim on the debtor's assets for its debt and the creditors whose rights are subordinate will thus have fewer assets to satisfy their claims. Subordination can take place by operation of law or by agreement among the creditors.