What Is The Role of a President of a Corporation?
One of the highest-profile positions in a corporation is the company president. This crucial leadership role is often tasked with managing the day-to-day responsibilities of the team, executing new company strategies, and representing the brand in public whenever necessary. The exact details of the role can vary depending on the size and structure of the organization, but in most cases, the president acts as a key decision-maker, bridging the gap between executive leadership and the operational staff.
To better understand the role of a president in a company, let’s first review the main leadership roles that make up a corporation’s leadership framework. Generally, there are three tiers of power in a corporation:
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The shareholders are the owners of the company. A shareholder is not a hands-on member of the business, but instead votes on major corporate decisions, like electing board members and approving major corporate changes.
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The directors serve on the board and are responsible for the company’s overall management. Directors monitor a company’s management team and make decisions that protect and enhance shareholder value.
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The officers handle the day-to-day matters of the company as well as carry out the directors’ decisions and policies.
The President, Vice President, Secretary, and Treasurer are all examples of high-ranking officers who have roles in a corporation. If necessary, the board can also choose to appoint other officers, such as a Chief Executive Officer (CEO), Chief Financial Officer (CFO), Chief Technology Officer (CTO), or any other title the board wishes to create.
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The person who is President of a company is in the highest position within an organization and, in some cases, takes on the title of Chief Executive Officer as well. The President/CEO is often (but not always) the founder and owner of the business, meaning that they have an extended history with the brand, and are often familiar with the industry.
Roles and Responsibilities of a Company President
So, what exactly does the president of a corporation do? A company president’s job description tends to be a little more fluid than that of other roles in the business, but usually requires a balance of big-picture thinking and hands-on leadership.
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Clearly define and communicate the organization’s mission and consistently integrate it into business activities.
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Oversee the hiring and firing of all employees of the company.
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Provide executive leadership to managers and staff, ensuring the successful execution of daily operations and long-term objectives.
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Meet regularly with other officers or managers of the company to ensure that the organization's decisions are prescient and strategic.
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Confirm that all officers and managers are conveying the company’s philosophies and guidelines to their own teams so that all employees understand the expectations of the company.
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Oversee all the financial aspects of the company while staying attuned to trends related to market conditions, customer behavior, competition, and emerging industry developments.
Requirements to be the President of a Corporation
There are no universal legal requirements to become the president of a corporation. The president of a corporation can have as much or as little experience in the role as the company sees fit. In fact, it is relatively common for the president to be the original founder and owner of the business. There are several common qualifications and expectations that companies look for when selecting someone for this role, but these requirements vary greatly. When hiring a new president, a corporation may look for some of the following:
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Leadership experience: Most presidents have extensive experience in executive or senior management roles. A proven track record of leading a team is usually essential.
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Industry knowledge: Familiarity with the specific industry the company operates in allows the president to anticipate market trends and understand the customers’ needs.
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Educational background: Many company presidents hold a degree in business, finance, management, or a related field.
In most corporations, the president is formally appointed by the board of directors. This means the individual must earn the confidence of the board and shareholders, especially in large, public companies. In some cases, the president of a company takes on the title of Chief Executive Officer as well.
Difference Between a CEO and a President
A common misconception for first-time business owners is that the president and CEO are different names for the same role. While the roles of CEO and president are sometimes held by the same person, especially in smaller companies, they are distinct positions with different areas of focus. The CEO is typically responsible for making major corporate decisions and communicating with the board of directors and external stakeholders. On the other hand, the president of a company is more involved in the internal management of the organization and will sometimes report directly to the CEO.
As a first-time business owner, it’s important to know the role of a president in a company, as you may be taking on some of these duties yourself. And even if you delegate the role to someone else, knowing what to expect allows you to select the right person. Keep in mind that the role of president in a company is not standardized. These are general terms of a corporate President’s duties, but they may differ in individual organizations.
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*Disclaimer*: Harvard Business Services, Inc. is neither a law firm nor an accounting firm and, even in cases where the author is an attorney, or a tax professional, nothing in this article constitutes legal or tax advice. This article provides general commentary on, and analysis of, the subject addressed. We strongly advise that you consult an attorney or tax professional to receive legal or tax guidance tailored to your specific circumstances. Any action taken or not taken based on this article is at your own risk. If an article cites or provides a link to third-party sources or websites, Harvard Business Services, Inc. is not responsible for and makes no representations regarding such source’s content or accuracy. Opinions expressed in this article do not necessarily reflect those of Harvard Business Services, Inc.
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There are 11 comments left for What Is The Role of a President of a Corporation?
Raj Bhatia said: Thursday, January 14, 2021The President does day-to-day EXECUTION of the strategy while a CEO the boss sets the vision and the strategy. The highest job is that of a CEO.
Kathleen Sixto said: Thursday, July 2, 2020Can a president may removed fromm his position? If yes,what may be the reasons.?
HBS Staff replied: Monday, July 6, 2020Yes, it is possible to remove a President or any officer in a corporation. Here's a blog post that discusses the process: https://www.delawareinc.com/blog/remove-replace-officer-delaware-corporation.
Secret said: Monday, May 11, 2020What is the work of the President/CEO of a group of companies do? What are the things they need to do if there are a President who take care to that company who is under to him/her, does he/she have work to do or nothing at all?
HBS Staff replied: Monday, May 11, 2020The President of a company typically has the responsibilities noted in the article above. Even if the company is the parent of other companies, President is still an important role.
tasheena said: Monday, October 28, 2019does the president interview the employees often or not at all?
HBS Staff replied: Monday, October 28, 2019This will vary form company to company. In a new company, the President may be the founder and only employee, so he or she would likely interview any new candidates. In a larger company, the President may not be involved with interviews very much at all.
PY said: Wednesday, April 25, 2018Can there be 2 co-corporate secretaries? with similar powers? or a secretary and an under-secretary acting only when the secretary is absent for example?
HBS Staff replied: Wednesday, April 25, 2018Typically, the roles and titles are specified internally in thecompany's bylaws, so it is more or less up to the company.