Difference Between Director and Executive Director

Director vs Executive Director

Director and executive director are two of the important positions in an organization. The chief executive officer of any organization is normally referred to as its director. Whenever there is a business startup, this position is filled by the founder of the business. The role of the person holding this post is to ensure that the company achieves its objectives and he is there to oversee the operations and to provide leadership to the enterprise. He is responsible for the success of the organization in accordance with prevailing laws. There are two types of directors, one who is simply a director (non executive) and the other one is an executive director. The roles and responsibilities of both are different that will be highlighted in this article.

Executive director

Executive director has a special role to perform in any organization. He not only manages people, looks after assets, oversees hiring and firing of employees, but also has to play lead role in entering into contracts. He is the leader of the ship and is required to have extensive knowledge and skills in a wide variety of areas. He advises and supports board members, oversees designs, marketing advertising, quality of products and services, recommends budget and uses resources to manage within this budget, manages men and ensures that all rules and regulations are obeyed. This is not all as he has to worry about the perception of the company in the eyes of the public so he indulges in PR also.

Director (non executive)

The holder of this post has less experience and knowledge than an executive director. He is almost an outsider and is less hands on than an executive director. He brings objectivity and outside knowledge to the board. This type of director does not get involved with day to day operations and management. He is more of a whistle blower and over viewer, ensuring good business practices are adhered to and interest of the stakeholders is looked after. Such a director is not an employee of the company and is normally self-employed.

Summary • While the legal responsibilities of both non executive and executive director are similar in nature, there is basic difference between the role and scope of the two types of directors. • While executive director is deeply involved with day to day management and all other operations, director is not even an employee of the company and is normally self employed • Director is an outsider who brings objectivity to the company. On the other hand, executive director uses all his skills and knowledge to steer the ship of the company.