THE RESPONSIBILITIES OF A MANAGING DIRECTOR (CEO)

E N A C H E S A B I N

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T E A C H E R A D V I S O R : M I H A I D A N I E L F R U M U S E L U

INTERNATIONAL USE In some European Union countries, there are two separate boards, one executive board for

the day-to-day business and one supervisory board for control purposes (selected by the shareholders). 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 allows for clear lines of authority. The aim is to prevent a conflict of interest and too much power being concentrated in the hands of one person.

In the United States, the board of directors (elected by the shareholders) is often equivalent to the supervisory board, while the executive board may often be known as the executive committee (the division/subsidiary heads and C-level officers that report directly to the CEO).

In the United States, and in business, the executive officers are usually the top officers of a corporation, the chief executive officer (CEO) being the best-known type. The definition varies; for instance, the California Corporate Disclosure Act defines "Executive Officers" as the five most highly compensated officers not also sitting on the board of directors. In the case of a sole proprietorship, an executive officer is the sole proprietor. In the case of a partnership, an executive officer is a managing partner, senior partner, or administrative partner. In the case of a limited liability company, executive officer is any member, manager or officer.

RELATED POSITIONS In the US, the term chief executive officer is used primarily in business, whereas the

term executive director is used primarily in the not-for-profit sector. These terms are generally mutually exclusive and refer to distinct legal duties and responsibilities which are incompatible. Implicit in the use of these titles is that the public not be misled and the general standard regarding their use be consistently applied.

In the UK, "chief executive" and, much more rarely "chief executive officer", are used in both business and the charitable sector (not-for-profit sector). As of 2013 the use of the term director for senior charity staff is deprecated to avoid confusion with the legal duties and responsibilities associated with being a charity director or trustee, which are normally non-executive (unpaid) roles.

Typically, a CEO has several subordinate executives, each of whom has specific functional responsibilities.

Hospitals and healthcare organizations also often include a chief medical officer (CMO), a chief nursing officer (CNO), and a chief medical informatics officer (CMIO).

In the United Kingdom, the term director is used instead of chief officer. Senior positions may include the audit executive, business development director, chief executive, compliance director, creative director, director of communications, diversity director, financial director, human resources director, information technology director, legal affairs director, managing director (MD), marketing director, operations director and technical director.

RESPONSABILITIES formulating and successfully implementing company policy; directing strategy towards the profitable growth and operation of the company; developing strategic operating plans that reflect the longer-term objectives and priorities

established by the board; maintaining an ongoing dialogue with the chairman of the board; putting in place adequate operational planning and financial control systems; ensuring that the operating objectives and standards of performance are not only understood

but owned by the management and other employees; closely monitoring the operating and financial results against plans and budgets; taking remedial action where necessary and informing the board of significant changes; maintaining the operational performance of the company; monitoring the actions of the functional board directors; assuming full accountability to the board for all company operations; representing the company to major customers and professional associations; building and maintaining an effective executive team.