A CEO does not look after the day-to-day operations of the company. Instead, they are much more involved in designing strategies and visions for the company. A Managing Director is involved in the company’s daily management and motivates the employees. A CEO reports to the company’s Board of DirectorsBoard of Directors (BOD) refers to a corporate body comprising a group of elected people who represent the interest of a company’s stockholders. The board forms the top layer of the hierarchy and focuses on ensuring that the company efficiently achieves its goals. read more. In contrast, a managing director takes orders from the chief executive officer. Show A CEO is not accountable to the shareholders of the company. Instead, a CEOChief Executive Officer is the full form of CEO. He is the most senior member of a corporate organization, an executive who oversees the whole administration and operations of the company and reports directly to the board of directors and chairman, with the sole purpose of generating wealth for the company's stakeholders and shareholders. read more often acts as a leader or a communicator for the company and implements change within the organization. On the other hand, a managing director is accountable to the company’s shareholders, but he does not have the substantial authority to sign cheques or share certificates. In this article, we look at the differences between CEO and Managing Director in detail: – Responsibilities of a CEOThe responsibilities of a CEO include maximizing the share price, market price, revenues, or other elements. In a non-profit and government organization, the chief executive officer or the CEO typically aims at achieving the organization’s long-term and short-term missions like reducing poverty, increasing literacy, etc. The CEO controls the President, Chief Executive, CEE, and Managing Director. So, we can safely say that the Chief Executive Officer or the CEO comes into play directly under the Board of Directors of an organization. The Board of Directors determines the responsibility of the CEO based on the organization’s legal structure. They can be far-reaching and the formal delegation of authority. Typically, the duties of a Chief Executive Officer or CEO include decision making, developing a strategy, and other key policy issues, along with being a manager or executor. As a company leader, the CEO drives change and motivates the employees. The Chief Executive Officer presides over the company’s day-to-day operations as a manager. They are the one who makes all the key decisions relating to the company, which includes all the fields of the business, including operations, marketing, business development, finance, human resources, etc. Responsibilities of a Managing DirectorA Managing Director is responsible for the company’s daily operations, organization, or corporate division. In some countries, the term Managing Director is equivalent to the CEO. There are four ways to appoint or decide upon a managing director. One way is that a Managing Director can be selected by a resolution passed at a general meeting. Secondly, they can be appointed by the association of a company. The third method is appointing a Managing Director with the Board of Directors. And the fourth way is by way of an agreement with a company. The Managing Director has substantial powers to manage the company’s affairs. But this considerable power does not include administrational acts like the signing of cheques or share certificates. A Managing Director is directly responsible for managing the day-to-day functions of an organization and reports to the CEO regarding any progress and escalations required. The heads of different divisions and the management report to the Managing Director, and the managing director helps the overall management in the smooth functioning of other divisions. Here, we provide you with the top 5 differences between CEO and Managing Director: – Let us look at the head-to-head differences between the CEO and Managing Director: –
ConclusionThe terms CEO and Managing Director in an organization refer to different positions. But some countries may refer to the same place in the organizational structure since these two positions exist within the same company but have other functions and responsibilities. Their roles and responsibilities depend on the company’s setup and the industry to which the company belongs. Recommended ArticlesThis article is a guide to CEO vs. Managing Director. We discuss the top 5 differences between CEO and Managing Director, infographics, and a comparison table. You may also have a look at the following articles: – This article has multiple issues. Please help improve it or discuss these issues on the talk page. (Learn how and when to remove these template messages)
This article possibly contains original research.(February 2012) This article needs additional citations for verification.(April 2011) The examples and perspective in this article may not represent a worldwide view of the subject.(February 2018) Corporate titles or business titles are given to corporate officers to show what duties and responsibilities they have in the organization. Such titles are used by publicly and privately held for-profit corporations, cooperatives, non-profit organizations, educational institutions, partnerships, and sole proprietorships also confer corporate titles.
This section does not cite any sources.(February 2012) There are considerable variations in the composition and responsibilities of corporate title.
Within the corporate office or corporate center of a corporation, some corporations have a chairman and chief executive officer (CEO) as the top-ranking executive, while the number two is the president and chief operating officer (COO); other corporations have a president and CEO but no official deputy. Typically, senior managers are "higher" than vice presidents, although many times a senior officer may also hold a vice president title, such as executive vice president and chief financial officer (CFO). The board of directors is technically not part of management itself, although its chairman may be considered part of the corporate office if he or she is an executive chairman.
A corporation often consists of different businesses, whose senior executives report directly to the CEO or COO, but that depends on the form of the business. If organized as a division then the top manager is often known as an executive vice president (EVP). If that business is a subsidiary which has considerably more independence, then the title might be chairman and CEO. In many countries, particularly in Europe and Asia, there is a separate executive board for day-to-day business and supervisory board (elected by shareholders) for control purposes. In these countries, the CEO presides over the executive board and the chairman presides over the supervisory board, and these two roles will always be held by different people. This ensures a distinction between management by the executive board and governance by the supervisory board. This seemingly allows for clear lines of authority. There is a strong parallel here with the structure of government, which tends to separate the political cabinet from the management civil service. In the United States and other countries that follow a single-board corporate structure, the board of directors (elected by the shareholders) is often equivalent to the European or Asian supervisory board, while the functions of the executive board may be vested either in the board of directors or in a separate committee, which may be called an operating committee (J.P. Morgan Chase),[1] management committee (Goldman Sachs), executive committee (Lehman Brothers), executive council (Hewlett-Packard), or executive board (HeiG) composed of the division/subsidiary heads and senior officers that report directly to the CEO. United StatesState laws in the United States traditionally required certain positions to be created within every corporation, such as president, secretary and treasurer. Today, the approach under the Model Business Corporation Act, which is employed in many states, is to grant corporations discretion in determining which titles to have, with the only mandated organ being the board of directors.[2] Some states that do not employ the MBCA continue to require that certain offices be established. Under the law of Delaware, where most large US corporations are established, stock certificates must be signed by two officers with titles specified by law (e.g. a president and secretary or a president and treasurer).[3] Every corporation incorporated in California must have a chairman of the board or a president (or both), as well as a secretary and a chief financial officer.[4] Limited liability company (LLC)-structured companies are generally run directly by their members, but the members can agree to appoint officers such as a CEO or to appoint "managers" to operate the company.[5] American companies are generally led by a CEO. In some companies, the CEO also has the title of "president". In other companies, a president is a different person, and the primary duties of the two positions are defined in the company's bylaws (or the laws of the governing legal jurisdiction). Many companies also have a CFO, a chief operating officer (COO) and other senior positions such as chief legal officer (CLO), chief strategy officer (CSO), chief marketing officer (CMO), etc. that report to the president and CEO. The next level, which are not executive positions, is middle management and may be called "vice presidents", "directors" or "managers", depending on the size and required managerial depth of the company.[6] United KingdomIn British English, the title of managing director is generally synonymous with that of chief executive officer.[7] Managing directors do not have any particular authority under the Companies Act in the UK, but do have implied authority based on the general understanding of what their position entails, as well as any authority expressly delegated by the board of directors.[8] Japan and South KoreaIn Japan, corporate titles are roughly standardized across companies and organizations; although there is variation from company to company, corporate titles within a company are always consistent, and the large companies in Japan generally follow the same outline.[9] These titles are the formal titles that are used on business cards.[10] Korean corporate titles are similar to those of Japan. Legally, Japanese and Korean companies are only required to have a board of directors with at least one representative director.[11][citation needed] In Japanese, a company director is called a torishimariyaku (取締役) and a representative director is called a daihyō torishimariyaku (代表取締役). The equivalent Korean titles are isa (이사, 理事) and daepyo-isa (대표이사, 代表理事). These titles are often combined with lower titles, e.g. senmu torishimariyaku or jōmu torishimariyaku for Japanese executives who are also board members.[12][13] Most Japanese companies also have statutory auditors, who operate alongside the board of directors in supervisory roles. Under the commercial code in Japan, Jugyōin (従業員) meaning the "employee", is different from Kaishain (会社員), meaning the "stockholders". The typical structure of executive titles in large companies includes the following:[12][13][14]
The top management group, comprising jomu/sangmu and above, is often referred to collectively as "cadre" or "senior management" (幹部 or 重役; kambu or juyaku in Japanese; ganbu or jungyŏk in Korean). Some Japanese and Korean companies have also adopted American-style titles, but these are not yet widespread and their usage varies. For example, although there is a Korean translation for "chief operating officer" (최고운영책임자, choego unyŏng chaegimja), not many companies have yet adopted it with the exception of a few multi-national companies such as Samsung and CJ (a spin-off from Samsung), while the CFO title is often used alongside other titles such as bu-sajang (SEVP) or Jŏnmu (EVP). Since the late 1990s, many Japanese companies have introduced the title of shikkō yakuin (執行役員) or 'officer', seeking to emulate the separation of directors and officers found in American companies. In 2002, the statutory title of shikkō yaku (執行役) was introduced for use in companies that introduced a three-committee structure in their board of directors. The titles are frequently given to buchō and higher-level personnel. Although the two titles are very similar in intent and usage, there are several legal distinctions: shikkō yaku make their own decisions in the course of performing work delegated to them by the board of directors, and are considered managers of the company rather than employees, with a legal status similar to that of directors. Shikkō yakuin are considered employees of the company that follow the decisions of the board of directors, although in some cases directors may have the shikkō yakuin title as well.[18][19] The highest-level executives in senior management usually have titles beginning with "chief" and ending with "officer", forming what is often called the "C-suite" or "CxO", where "x" is a variable that could be any functional area (not to be confused with CXO).[20] The traditional three such officers are CEO, COO, and CFO. Depending on the management structure, titles may exist instead of, or be blended/overlapped with, other traditional executive titles, such as president, various designations of vice presidents (e.g. VP of marketing), and general managers or directors of various divisions (such as director of marketing); the latter may or may not imply membership of the board of directors. Certain other prominent positions have emerged, some of which are sector-specific. For example, chief audit executive (CAE), chief procurement officer (CPO) and chief risk officer (CRO) positions are often found in many types of financial services companies. Technology companies of all sorts now tend to have a chief technology officer (CTO) to manage technology development. A chief information officer (CIO) oversees information technology (IT) matters, either in companies that specialize in IT or in any kind of company that relies on it for supporting infrastructure. Many companies now also have a chief marketing officer (CMO), particularly mature companies in competitive sectors, where brand management is a high priority. A chief value officer (CVO) is introduced in companies where business processes and organizational entities are focused on the creation and maximization of value. Approximately 50% of the S&P 500 companies have created a chief strategy officer (CSO) in their top management team to lead strategic planning and manage inorganic growth, which provides a long range perspective versus the tactical view of the COO or CFO. This function often replaces a COO on the C-Suite team, in cases where the company wants to focus on growth rather than efficiency and cost containment. A chief administrative officer (CAO) may be found in many large complex organizations that have various departments or divisions. Additionally, many companies now call their top diversity leadership position the chief diversity officer (CDO). However, this and many other nontraditional and lower-ranking titles are not universally recognized as corporate officers, and they tend to be specific to particular organizational cultures or the preferences of employees. Specific corporate officer positionsChairman of the board – presiding officer of the corporate board of directors. The chairman influences the board of directors, which in turn elects and removes the officers of a corporation and oversees the human, financial, environmental and technical operations of a corporation.
List of chief officer (CO) titles
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