There are several positions of authority in a business corporation, firm, company, or non-profit organization. A CEO and Executive Director are two such positions of power in a company that have their jurisdictions and areas of operation.
Key Takeaways
- A chief executive officer (CEO) is the highest-ranking executive responsible for making major corporate decisions and overseeing a company’s overall operations. In contrast, an executive director is a member of the board of directors who participates in strategic planning and decision-making.
- CEOs focus on day-to-day management, setting company goals, and ensuring efficient execution, while executive directors contribute to the company’s direction through board discussions and voting on critical issues.
- The CEO reports to the board of directors, which may include the executive director, who represents the interests of shareholders and helps maintain corporate governance.
CEO vs Executive Director
The CEO (Chief Executive Officer) is the highest-ranking executive in a company, responsible for making strategic decisions, managing all operations of the company, and leading its employees. An Executive Director is a senior executive who is responsible for managing a specific area within a company.
The CEO can bring about considerable changes in the policies of the organization. In addition, the CEO of a company is not the owner of the company.
An executive director refers to the manager of a company’s business policies and day-to-day functioning. An executive director takes up the responsibility of developing the culture of the organization.
Comparison Table
| Parameters of Comparison | CEO | Executive Director |
|---|---|---|
| Answerability | A CEO is not answerable to the shareholders of the company. | An executive director is answerable to the shareholders of a company. |
| Accountability | The CEO is accountable to the Board of Directors. | The Executive Director provides guidance to the Board of Directors. |
| Another Name | Another name of CEO is the Chief Administrative Officer. | Another name of Executive Director is the Managing Director. |
| Salary | The salary of a CEO is higher than that of an Executive Director. | The salary of an Executive Director is lower than that of a CEO. |
| Association | A CEO is associated with business corporations and firms. | The Executive Director is associated with non-profit organizations. |
What is a CEO?
CEO refers to an individual responsible for managing an organization. CEOs are individuals employable in both private and public companies.
One of the most typical responsibilities of a CEO is to act as a decision-maker on business strategy and other crucial policy issues. All in all, the CEO is solely responsible for operations, marketing, human resources, finance, and business development.
Moreover, the CEO is the head of the executive board in most countries. The objective of a CEO is to achieve a company’s target.
A CEO motivates employees to ensure maximum productivity. They also can bring about considerable changes in the policies of the organization.
What is an Executive Director?
An executive director is a member of the Board of Directors. However, the term stands for different positions of responsibility in different countries.
An executive director serves to satisfy two major goals for the company: profit maximization and time effectiveness. The executive director also manages the staff and committees as well as takes responsibility for developing business plans.
An executive director is also responsible for developing the organizational culture. To be eligible for the post of executive director, an individual should have a master’s in business education or equivalent and highly ethical behaviour.
Some other chores of an executive director include drafting the organisation’s policies, conducting performance reviews, preparing comprehensive budgets, a report on revenue and expenditure, and engaging with community groups.
Main Differences Between CEO and Executive Director
- Another name of the CEO is the Chief Administrative Officer. On the other hand, another name for Executive Director is the Managing Director.
- A CEO is not answerable to the shareholders of the company. In contrast, the executive director is answerable to the shareholders of a company.
- https://www.tronviggroup.com/executive-director-versus-ceo/
- https://bestaccreditedcolleges.org/articles/difference-between-ceo-executive-director.html
Last Updated : 13 July, 2023
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Chara Yadav holds MBA in Finance. Her goal is to simplify finance-related topics. She has worked in finance for about 25 years. She has held multiple finance and banking classes for business schools and communities. Read more at her bio page.
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I believe the article effectively presents the differences in role and responsibilities of CEO and Executive Director. It enhances the understanding of the corporate hierarchy and its functioning.
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