{"id":4557,"date":"2021-09-07T16:00:29","date_gmt":"2021-09-07T21:00:29","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/smallbusiness\/business-operations\/corporate-officer-definition.html"},"modified":"2024-06-06T02:17:52","modified_gmt":"2024-06-06T07:17:52","slug":"corporate-officer-definition","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/smallbusiness\/business-operations\/corporate-officer-definition.html","title":{"rendered":"What Is a Corporate Officer?"},"content":{"rendered":"\n<div class=\"fl-sectionWithSidebar fl-container fl-flex fl-flex-wrap fl-gap30  wp-container-core-columns-is-layout-9d6595d7 fl-sectionWithSidebar fl-container fl-flex fl-flex-wrap fl-gap30\">\n    \n    <div class=\"fl-section-main fl-page-articles fl-section-main fl-section-main-full-width\">\n        <h1 class=\"fl-no-margin-top\">What Is a Corporate Officer?<\/h1>\n<section class=\"fl-gutenberg-byline\">\n    <div class=\"fl-gutenberg-byline-content\">\n                    By <a href=\"https:\/\/www.findlaw.com\/company\/our-team\/linda-long-jd\/\">Linda Long, J.D.<\/a> | Legally reviewed by <a\n                href=\"https:\/\/www.findlaw.com\/company\/our-team\/j-p-finet-j-d\/\">J.P. Finet, J.D.<\/a>\n                | Last updated\n        <time>\n                            June 06, 2024\n                    <\/time>\n    <\/div>\n\n            <div class=\"fl-gutenberg-byline-editorial-note fl-text-sm\">\n            <p>Editorial Note: We earn a commission from affiliate partner links on FindLaw. Commissions do not affect the editorial integrity of our legal content.<\/p>\n\n        <\/div>\n    \n    <details class=\"fl-gutenberg-byline-toggle fl-gutenberg-byline-legally-reviewed\">\n        <summary>\n            <i class=\"fl-gutenberg-byline-icon\" aria-hidden=\"true\"><\/i>\n            Legally Reviewed\n        <\/summary>\n\n        <div class=\"fl-gutenberg-byline-toggle-content\">\n            <p><em>This article has been written and reviewed for legal accuracy, clarity, and style by <a href=\"https:\/\/www.findlaw.com\/company\/our-team.html\">FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with <a href=\"https:\/\/www.findlaw.com\/company\/company-history\/editorial-policy.html\">our editorial standards<\/a>.<\/em><\/p>\n\n        <\/div>\n    <\/details>\n\n    <details class=\"fl-gutenberg-byline-toggle fl-gutenberg-byline-fast-checked\">\n        <summary>\n            <i class=\"fl-gutenberg-byline-icon\" aria-hidden=\"true\"><\/i>\n            Fact-Checked\n        <\/summary>\n\n        <div class=\"fl-gutenberg-byline-toggle-content\">\n            <p><em>The last updated date refers to the last time this article was reviewed by FindLaw or one of our <a href=\"https:\/\/www.findlaw.com\/company\/our-team\/contributing-authors.html\">contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please <a href=\"https:\/\/lawyers.findlaw.com\/?fli=bylinelink\" target=\"_blank\" rel=\"noopener\">contact an attorney in your area<\/a>.<\/em><\/p>\n\n        <\/div>\n    <\/details>\n<\/section>\n<p>The role of a corporate officer is to manage the business activities of a <a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/corporations.html\">corporation<\/a>. The company&#8217;s directors usually appoint the corporate officers.<\/p>\r\n<p>The organizational structure of a corporation typically includes officers who serve as:<\/p>\r\n<ul>\r\n<li><b>Chief executive officer:<\/b>&nbsp;The highest-ranking manager with the company who makes most of the major corporate decisions and serves as the public face of the company<\/li>\r\n<li><b>Chief financial officer:<\/b>&nbsp;The senior executive who is responsible for managing a corporation&#8217;s finances<\/li>\r\n<li><b>Chief operating officer:<\/b>&nbsp;The executive responsible for overseeing the day-to-day operations of the corporation<\/li>\r\n<\/ul>\r\n<p><b>We make business formation EASY. <a href=\"https:\/\/legalzoomcominc.pxf.io\/c\/4851649\/2115288\/26746?subId1=corporate-officer-definition-in-content\" rel=\"sponsored noopener\" data-cta=\"Biz LZ - LATL Callout\" data-cta-url=\"legalzoom.com\" target=\"_blank\">Click here to start your free LLC.<\/a><\/b><\/p>\r\n<h2>Key Takeaways<\/h2>\r\n<p>1. Corporate officers are usually appointed by the board of directors.<\/p>\r\n<p>2. Corporate officers make major corporate decisions and manage the company&#8217;s day-to-day operations.<\/p>\r\n<p>3. Corporate officers are employees who must be paid reasonable compensation if they provide more than minor services to the company.<\/p>\r\n<h2>Corporate Officers Integral to a Functioning Corporation<\/h2>\r\n<p>A corporation has many parts, and the&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/types-of-business-structures.html\">business structure<\/a>&nbsp;of the organization has many roles. Each role is <a href=\"https:\/\/corporate.findlaw.com\/corporate-governance.html\" target=\"_blank\" rel=\"noopener\">dependent upon others in the organization<\/a>. Shareholders are the owners of the corporation. The shareholders appoint the board of directors. The board of directors names the officers.<\/p>\r\n<p>You can think of the corporate structure as a flow chart that shows responsibility starts with the shareholders as owners and ends with the officers as managers with the everyday responsibility of running the corporation.<\/p>\r\n<h2>Corporate Officers Manage Day-to-Day Operations<\/h2>\r\n<p>The officers conduct routine business for the corporation. In addition to what some may think of as traditional officer positions, there are members of the team that fulfill different roles, including:<\/p>\r\n<ul>\r\n<li><b>Chief design officer:<\/b> A chief design officer oversees the company logo, website, and other advertising.<\/li>\r\n<li><b>Chief marketing officer:<\/b> A chief marketing officer is in charge of, as the title suggests, the marketing and advertising of the business.<\/li>\r\n<li><b>Chief diversity officer:<\/b> A chief diversity officer focuses on diversity and inclusion within the business.<\/li>\r\n<li><b>Chief risk officer:<\/b> A chief risk officer (CRO) is an executive who understands and evaluates corporate risk. The CRO helps the corporation take smart risks.<\/li>\r\n<li><b>Chief value officer:<\/b> A chief value officer is an executive that works to increase the corporation&#8217;s value and maintain the value of the business long-term.<\/li>\r\n<li><b>Chief procurement officer:<\/b> A chief procurement officer is in charge of acquiring goods or getting services for the corporation.<\/li>\r\n<\/ul>\r\n<p>There are often many additional&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/corporate-structure-directors-to-shareholders.html\">officers in a large corporation<\/a>. Each of these officers plays a vital role in corporate management. Whether the officer focuses on administrative duties or the executive is in an advisory role, each person has a critical job.<\/p>\r\n<p>The actual duties of each officer may vary from corporation to corporation. However, state law may impose specific legal duties on the officers. Officers in a corporation also carry fiduciary responsibilities on behalf of the corporate directors and the shareholders.<\/p>\r\n<h2>Corporate Officers Must be Reasonably Compensated<\/h2>\r\n<p>Officers who perform services for the company must be reasonably compensated as an <a href=\"https:\/\/www.findlaw.com\/employment.html\">employee<\/a>. Therefore, an officer who is also a shareholder can&#8217;t only be compensated using shareholder distributions or <a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/shareholders-dividends-and-taxes.html\">dividends<\/a>. However, if a corporate officer performs only minor services\u2014or none whatsoever\u2014they will not be considered an employee.<\/p>\r\n<p>Officers can also have concurrent titles. That means that an officer can be both an employee and an officer at the same time. Corporate profit should be used to pay the executives the money owed for their work.<\/p>\r\n<h2>Internal Links:<\/h2>\r\n<ul>\r\n<li><a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/pros-and-cons-why-form-a-corporation.html\">Pros and Cons: Why Form a Corporation?<\/a><br>\r\n<\/li>\r\n<li><a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/conducting-business-as-a-corporation-or-an-llc-out-of-state.html\">Conducting Business as a Corporation or an LLC Out of State<\/a><\/li>\r\n<li><a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/corporate-structure-directors-to-shareholders.html\">Corporate Structure: From Directors to Shareholders<\/a><br>\r\n<\/li>\r\n<li><a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/what-types-of-legal-procedures-should-corporations-maintain.html\">What Are the Ongoing Legal Obligations of a Corporation?<\/a><\/li>\r\n<\/ul>\r\n<div class=\"was-this-helpful\">\n    <div\n            class=\"was-this-helpful__question-container\"\n            aria-labelledby=\"was-this-helpful__question\"\n            role=\"group\"\n    >\n        <span\n                id=\"was-this-helpful__question\"\n                class=\"was-this-helpful__question fl-text-lg-bold\"\n        >Was this helpful?<\/span>\n        <button\n                class=\"was-this-helpful__button fl-text-sm\"\n                aria-label=\"Yes\"\n                value=\"yes\"\n        >\n            <span class=\"was-this-helpful__button-text fl-text-bold\">Yes<\/span>\n            <i class=\"was-this-helpful__button-icon\">\n                <svg width=\"22\" height=\"22\" viewBox=\"0 0 22 22\" fill=\"none\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\">\n                    <g id=\"thumbs-up\" clip-path=\"url(#clip0_604_3418)\">\n                        <path id=\"Vector\"\n                              d=\"M6 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2.22309 2.72003 2.7L1.34003 11.7C1.29652 11.9866 1.31586 12.2793 1.39669 12.5577C1.47753 12.8362 1.61793 13.0937 1.80817 13.3125C1.99842 13.5313 2.23395 13.7061 2.49846 13.8248C2.76297 13.9435 3.05012 14.0033 3.34003 14H9.00003Z\"\n                              stroke=\"#666666\" stroke-width=\"2\" stroke-linecap=\"round\" stroke-linejoin=\"round\"\/>\n                    <\/g>\n                    <defs>\n                        <clipPath id=\"clip0_604_3423\">\n                            <rect width=\"22\" height=\"22\" fill=\"white\"\/>\n                        <\/clipPath>\n                    <\/defs>\n                <\/svg>\n            <\/i>\n        <\/button>\n    <\/div>\n    <span class=\"was-this-helpful__taken-action fl-text-sm-bold\"><\/span>\n    <div class=\"was-this-helpful__feedback-container\">\n        <div class=\"was-this-helpful__choose-option-message\" role=\"status\">\n            <p class=\"was-this-helpful__choose-option-message-text\"><\/p>\n        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