People Critical To the Corporate Process Table of Contents Role of a Director in Closed Corporation and Publicly Listed Corporation 3 Role of an Officer in Closed Corporation and Publicly Listed Corporation 4 Role of Shareholders in Closed Corporation and Publicly Listed Corporation 5 References 6 Role of a Director in Closed Corporation and Publicly Listed Corporation The director of a closed corporation has several duties or responsibilities in the corporate process. The director of a private sector company acts as an independent owner taking the managerial decisions of the organization in order to achieve the long and short term goals.
They are also responsible to make sound decisions along with being good advisers. In private sector, the directors are considered as the backbone of the company, their decisions matter a lot to accomplish any of the verdicts which is predetermined (Dravis, 2007). On the contrary, the duties of the director in a publicly held corporation are concerned towards the attainment of an appropriate purpose which is mostly related to the shareholder value rather than the personal interest of the directors. The directors are also responsible for taking care of the employees along with any other segment of the organizational structure.
Even in public companies, the directors can be regarded as quite vital in the corporate process, due to the fact that they are liable for making budgetary decisions as well as steer the marketing, manufacturing and human resource departments among others as independent management personnel (Blakiston & Crabb, 2007). Role of an Officer in Closed Corporation and Publicly Listed Corporation The roles of an officer in closed corporations deal with leading, organizing, coordinating and planning among others. The officers are responsible for the managerial results of the organization and thus require monitoring the strategic implications of the company.
In other words, the responsibilities of officers comprise of approving and reviewing the strategies of the company. The officers are also responsible for taking care of the various stakeholders including the customers, the suppliers, the employees and the shareholders as well (Kerr & Nadeau, 2006). On the other hand, the ownership or responsibilities enjoyed by officers in a publicly held corporation are almost same as the directors in the company.
It is because, the directors intend to appoint the officers so as to assist them in executing the strategic plans developed for the benefit of the company and the shareholders as well. Thus, the role of an officer in a publicly listed company is to control the organizational process dealing with the issues faced by the company’s management and simultaneously, take care of the shareholders’ interest (Miller & Jentz, 2009). Role of Shareholders in Closed Corporation and Publicly Listed Corporation In a close corporation, the shareholders are responsible for those fiduciary duties which are not applicable to the directors and officers.
In these kinds of organizations, there are only a handful of shareholders observed to invest in the capital construction of the company in comparison to that in the case of publicly listed companies. Hence, shareholders have limited inclusion in the corporate process of closed companies (McCahery & Vermeulen, 2010). On the other hand, the basic role of the shareholder in a public corporation is that of an influencer in the decision-making process as they can select or elect the directors and the officers of the company.
The shareholders can give a proxy voting if they do not want to contest in time of the election for the directors and officers. The other role of the shareholders is to bring change in the management. Therefore, it can be apparently observed that shareholders have an active participation in the corporate process of a public company (Pinto, 2010). References Blakiston & Crabb, (2007). Overview of Duties Imposed On Directors Of Public Companies. Introduction. Retrieved Online on December 05, 2011 from http: //www. talismanmining. com. au/irm/Company/ShowPage. aspx? CPID=1093 Dravis, B. F., (2007). The Role of Independent Directors after Sarbanes-Oxley.
American Bar Association. KERR & Nadeau, (2006). Directors and Officers Duties and Liabilities. Corporate Governance. Retrieved Online on December 05, 2011 from http: //www. kerrnadeau. com/Grey_Book_Series/Grey_Book_Series_Corporate_Compliance_Directors_Officers. pdf McCahery, J. A. & Vermeulen, E. P. M., (2010). Corporate Governance of Non-Listed Companies. Oxford University Press. Miller, R. L. & Jentz, G. A., (2009). Fundamentals of Business Law: Excerpted Cases. Cengage Learning. Pinto, A. R., (2010). The Role of Shareholders in Publicly Traded Corporations in the United States. Papers. Retrieved Online on December 05, 2011 from http: //papers. ssrn. com/sol3/papers. cfm? abstract_id=1710005