Management of a Corporation

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There are three classes of management in a formal corporate enterprise: The Board of Directors, Officers, and Managers.

The Board of Directors are elected by the Shareholders to provide broad oversight and guidance to the Officers of the Corporation. Boards will have various committees with specific duties, such as the Audit Committee to liaise with the company's auditors, the Compensation Committee to determine the appropriate compensation for various senior managers, and many other ad hoc committees depending upon the needs of the business at the time.

Officers are appointed by the Board of Directors and at least three offices must be held by a minimum of two persons: The President, Secretary and Treasurer. Rules vary by state by state, but the President is generally the senior manager of the corporation. He reports to, and can be replaced by, the Board of Directors. In smaller companies, the Secretary and Treasurer position are normally held by one person, most likely the senior financial person in the business. In larger companies, the position of Secretary is normally held by a lawyer.

The Secretary's duties are to ensure the corporation fulfills its statutory requirements, and he is also keeper of the corporate seal. If the corporation is required to attest to a certain fact or condition, such attestation will probably be done by the Secretary.

The Treasurer is responsible for the financial affairs of the corporation, including but not limited to banking arrangements, proper filing of financial statements with regulatory authorities, and ensuring management has the timely, accurate and relevant information it needs to run the business.

In Europe, the concept of a corporate officer is not well known. Generally, a corporation will have outside directors (directors who are not employees of the corporation) and inside directors, such as the President. In England, the term Managing Director is often used to designate the President's job, however, terms like CEO and CFO are now commonplace there.

Beneath the officer level, there are managers and supervisors, who, by definition, accomplish their work through other people. Management titles at this level mean little. Many companies have literally hundreds of Vice Presidents, whereas others will have only one. In Europe the title Director implies that the holder is on the board, whereas in America in usually denotes someone between a Vice President and Manager.

The duties of the board and officers are specified in the documents used to incorporate the company, the laws the corporation is registered in and the laws of the jurisdictions in which it operates. Each state in the United States has rules for incorporating companies. In Canada, each province has rules and it is also possible for a corporation to obtain a federal charter.