Officers are appointed by the directors of a corporation. There are many different officers titles and positions that can be held by individuals. The scope of this Articles is to explain the different positions and statute requirements relating to them.
For information about how to appoint, remove or resign an officer refer to appointing officers.
Officer Titles for Private Companies
A private company is a company which does not sell shares to the general public. It is a company that is owned privately by one or more individuals or corporations.
The following are the customary and standard officer titles used by private companies:
These officers titles are the most popular and are limited to just a few because private companies frequently only have a few principals. Frequently there will be one person who holds the position of sole director, officer and shareholder (owner). In this situation he or she will normally hold the positions of President and Secretary. In other cases there will be two people as principals of the company, one of which will hold the position of President and the other the position of Secretary.
The officers titles given to individuals in private companies do not always denote the functions they will handle. Sometimes these titles are given to individuals so each owner and director will also hold an officer position. For instance if there are two principals then one will be the President and the other will be the Secretary. If there are three individuals one may be the President, the other the Secretary and the third may be the Treasurer. In the case of a fourth individual, this person may be appointed to a Vice-President position.
Officers Titles in Public Companies
In public companies the officers titles can be very different. Frequently officers for public companies have more functions and duties and they may be supervising a department of a number of people. Some of the common titles for public companies are:
Chairman or Chairperson of the Board
Chief Executive Officer
Chief Financial Officer
How Many Officers Must a Company Have
All companies in all jurisdictions must have at least one officer. Normally if there is only one officer, the title that person will hold is President.
Officers Titles Can be Flexible
There is no set rule with respect to any title. A company can designate officer titles that it wishes, however, it is always good to have a President and a Secretary.
Can a Person Hold More Than One Officers Title
Yes. An individual can hold more than one officer position. However, some officer positions can only be held by one person. For instance, there is never more than one President, Chief Executive Officer, Chief Financial Officer, Secretary or Treasurer. There may be any number of Vice-Presidents and any number of Executive Vice-Presidents.
Board Appointed Officers versus Non-Board Appointed Officers
The board of directors of a company may appoint only a certain number of officer positions that are being held. For instance, three individuals may be owners of a company and all three of them have been appointed by the board of directors to hold those positions. A meeting was held to appoint them or a resolution of all of the directors was signed to appoint them. These individuals are called board appointed officers because of the manner in which they were appointed.
There may also be a General Manager or a Manager, Technology or a Manager, Office Supplies. These positions may not be officially appointed by the board yet they are officer positions. They would be considered non-appointed officer positions.
Public companies also may have non-appointed officers. The larger companies will have many departments operating different services and functions. They may appoint Vice-Presidents of those departments. There could be hundreds of Vice-Presidents appointed. The board of directors, in this case, would not appoint those Vice-Presidents.
Does an Officer Have to be a Director
In some cases there are certain officer positions which cannot be held by anyone unless that person is a director. For instance, a Chairman or Chair or Chairperson of the Board and a Managing Director (depending on what the governing statute says) must be a director to hold those positions.
Most governing corporate statutes are vague with respect to officers, however, the best way to determine whether an officer position must be held by a director is to check the statute. When a statute is silent on the issue there is no restriction.
As well, the by-laws of the corporation must also be reviewed. Some by-laws are set up to provide that certain officer positions must be held by a director and even though there may not be a statute requirement, if the by-law indicates this then the company must abide by those by-law provisions.
If a by-law provides that an officer position must be held by a director but the statute does not say it is mandatory, then the by-law can be amended. The statute will provide the method by which a by-law can be amended. For Ontario companies refer to Ontario By-laws Enactment, Amendment and Repeal.