This Practice Note is a ‘how to’ guide on preparing a parent company guarantee for a commercial, business-to-business (B2B) transaction which signposts relevant content. It includes links to potentially relevant issues, including what is a guarantee, preliminary considerations, drafting the parent company guarantee (including the parties, duration, scope, indemnities, dealing with variations to the underlying agreement, no subrogation), and other legal and practical considerations. A parent company guarantee (PCG) is a guarantee given by one contracting party's ultimate or intermediate holding company in favour of the other contracting party to secure the performance of that party's obligations under the contract. PCGs are often sought from a customer in respect of the performance obligations of a supplier, but may equally be sought by a supplier in respect of the payment obligations of a customer. This ‘How to Guide’ is a very high-level introduction to preparing a parent company guarantee for commercial transactions and may be suitable for trainee solicitors or junior lawyers. See also Parent company guarantees in commercial transactions—checklist. For examples of PCGs, see Precedents: • Parent company guarantee—commercial contracts in which