Director vs Executive Director

Difference Between Director vs Executive Director

Director refers to the person in a company who is part of board of directors and responsible for taking company’s important decisions and it can be either full time or part-time director, whereas an Executive Director refers to the person in a company who is considered as board of director’s head and appointed as a full-time employee of the company who earns salary from the company over and above director remuneration like an employee

Who is a Director?

For a relatively small to a large organization, whether the business is a public or private company director stands for a leader of a particular function within the organization. Directors are broadly divided into two types, one of them know as the executive directors and the other type is known as the non-executive directors. Generally, directors are part of the board of the company which discusses all the important strategies within the company for various functions like marketing, finance, human resource, and information technology.

Directors are responsible for taking all the important decisions for the company. It is crucial for the director to have the right set of experience and knowledge in order to make decisions for the company. The non-executive directors are the ones who are not part of the organization and do not take part in the day to day activities of the company. They are part of the board of directors because they bring in knowledge and expertise in special areas and are from other organizations. Non-executive directors generally provide an unbiased solution to a particularly critical problem as they are not part of the organization.

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Who is an Executive Director?

Executive directors are generally head of the board of directors for an organization. They are the internal employees of the organization and are responsible for the day to day activities of the organization. They head the board of directors and lay the role of a manager and also that of a leader. There are many executive directors which may vary depending on the functions within an organization and the nature of the organization.

They are of various types like marketing directors, finance directors, and managing directors. It is responsible for running the business right from day to day activities within an organization to expanding the business and take all the critical decisions. Other than that they are also responsible for taking care of all the legal aspects within the firm, to taxations applicable to taking note of the changes due to accounting adjustments in the organization. Executive directors need to lead the board by finalizing a decision by reaching a consensus among the other board of directors.

Director vs Executive Director Infographics

Here we provide you with the top 4 difference between Director vs Executive Director

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Director vs Executive Director – Key Differences

The key differences between Director vs Executive Director are as follows –

  • Directors can be broadly divided into two one of them is the executive directors and the other one is the non-executive directors. It can be further divided into shadow directors, alternate directors, and de facto directors. Executive directors are of various types depending on the number of functions present within an organization like marketing directors, finance directors, director for information technology and managing directors.
  • Non-executive directors do not take part in the day to day activities of the organization as they not part of the organization and are generally hired from another organization on a part-time capacity to provide their expertise in a niche area. Executive directors are part of the organization and take part in the day to day activity of the organization.
  • Directors are part of the board that takes all the important decisions for the company, the executive directors are generally the head of the board and functions as both manager and leader of the board.

Director vs Executive Director Head to Head Difference

Let’s now look at the head to head difference between Director vs Executive Director

Basis – Director vs Executive DirectorDirectorExecutive Director
DefinitionFor public or a private company, director stand for a leader of a particular function within the organization. Director is a broader term within the organization and can be created a lot of category out of it.They are generally head of the board of the directors for an organization. They are the internal employees of the organization and are responsible for the day to day activities of the organization.
TypesIt can be broadly divided into two one of them is the executive directors and the other one is the non-executive directors. Depending on the size and nature of the company directors can be further divided into shadow directors, alternate directors, and de facto directors.There are of various types depending on the number of functions present within an organization like marketing directors, finance directors, director for information technology and managing directors.
FunctionIt is not part of the organization and is not involved in the day to day activities of an organization.They are the direct employees of the organization and involved in all day to day activities within the organization.
NatureThey are responsible for taking all the important decisions for the company. It is crucial for the director to have the right set of experience and knowledge in order to make decisions for the company.They are responsible for both manage and lead the board of directors in the organization

Conclusion

The directors are the leaders of an organization who leads various functions within the organization. Directors are part of the board which takes all the important decisions for the company. Directors are mainly of two type’s executive directors who are part of the organization and generally head the board of the directors. The other type is non-executive directors who are outsiders and work as a part-time role to provide specific knowledge and expertise for the organization.

This has been a guide to the Director vs Executive Director. Here we discuss the top differences between Director and Executive Director along with infographics and comparison table. You may also have a look at the following articles –

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