Directors & Officers

Started by ShelleyD • 6 replies • 1293 views

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ShelleyD (Florida)
Posts: 42

Posted:

Can anyone tell me the difference between an Officer and a Director?

JohnK3 (Pennsylvania)
Posts: 967

Posted:

Shelly,

Typically, but not always, the Board is elected by Membership to oversee the HOAs operations. Typically, but not always, Officers are appointed by the Board to handle specific duties often listed in the ByLaws. Typically, but not always, BODs occupy one or more Officer positions. In our HOA, our three Board members are also the three Officers (prez, vp, s/t).

DonnaS (Tennessee)
Posts: 5,671

Posted:

Typically, but not always, Boards having several elected members will have a V.P, second V.P ,Sec, Treasurer and members at large who are not officers. In Florida, Board members elected among themselves who will hold what officer position. At large Board members have the same voting rights as Officer members. The officers are required to be in place just for being incorporated as the corporations officers

GeorgerwilliamsW (Indiana)
Posts: 975

Posted:

Quote:

Posted By ShelleyD on 10/22/2008 9:09 AM
Can anyone tell me the difference between an Officer and a Director?

Let me give it a shot. It will probably raise more question.

It is an incredibly astute question, since many people confuse the two roles. In homeowners associations, because boards tend to operate as if they are government commissioners, rather than corporate directors, the distinction is a confusing one.

A director is an elected (or appointed, in some cases) member of the board of directors which govern a corporate organization. Board members do not get involved in day-to-day management, but rather establish broad corporate policies, hire, appoint, or elect a chief executive officer, and assess the performance of the organization.

A board member's fiduciary duty is to the members or shareholders.

An officer is an elected or appointed official who has operational responsibilities for the affairs of the organization.

A good distinction is thus: a corporate officer is empowered to speak for the organization and to obligate the corporation by signing contracts. Of course, the authority and duties of officers is subject to limitations established by policies of the board of directors. A board member is not entitled to speak for the corporation, nor empowered to sign contracts or obligate the corporation.

Officers can be, but need not be members of the board of directors. The problem in homeowners associations is that people confuse officers and board members since the two groups overlap.

One reason why banks have so many vice presidents, is that in the past only bank officers were empowered to make loans. So the larger the bank, the more loan officer vice presidents it needed.

SusanW1 (Michigan)
Posts: 5,202

Posted:

Shelly - Officers can be the Officers that are listed on the Annual Report, to be filed in October in the State of Michigan, and filed with the State's dept. of corporations to keep the corporate status current (attache check, please.)

These Officers of the Corporation MAY or may not be the same people that are on the board of directors, or serving as officers of the Board.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Susan,

How can the officers listed on the annual report NOT be the same ". . .people serving as officers of the board"?

SusanW1 (Michigan)
Posts: 5,202

Posted:

See: http://www.idealist.org/if/i/en/faq/17-97/3-1

But note, they are talking about small non profits that have a CEO or management that is signing and sending off the Annual Report.

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