Job profile:
Managing Director (m/f/d)
Being a managing director and managing a company strategically and operationally is a major career goal for many people. But what does a managing director actually do and what rights and obligations does the person in the top position have? How much does a managing director earn and what are the differences between the various types of company? We shed light on these questions and much more in this job profile.
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What is a managing director? Definition and overview
A managing director is the highest level of management within a company and also officially represents this company to the outside world. The management can consist of one or more natural or legal persons. Their primary goal is always to advance the business purpose of the company and to take responsibility for the business and the employees. In Switzerland, a GmbH or AG requires at least one managing director who is resident in Switzerland.
The exact duties and powers of the management depend on the respective company form. The term "managing director" is therefore not a protected job title that can be clearly defined. In principle, the people who are tasked with managing the company are responsible for the strategic direction of the company and have the highest level of authority and responsibility.
The management of a GmbH (limited liability company) usually consists of one or more managing directors who are appointed by the shareholders. They are not personally liable for the company's liabilities, but represent the company both in and out of court.
In contrast, the management body of an AG (public limited company) is the Executive Board, which is appointed by a Board of Directors. The management board is not personally liable, but must act in the best interests of the shareholders. It acts alongside other bodies such as the Board of Directors.
What does CEO mean in German?
Managing Director Salary Switzerland: What does a Managing Director earn?
There is no upper limit to the salary of a managing director. As a rule, the management within the company earns the highest salary within a company. However, the exact amount earned depends very much on the size of the company, the industry and the annual turnover.
In Switzerland, members of the management earn a gross salary of around CHF 288,000.00 per year. Sole managing directors receive CHF 324,000.00, according to the management salary study by the consultancy firm Kienbaum.
The salary is made up of the monthly basic salary, as well as bonuses and gratuities such as a 13th month's pay. At the end of the year, management staff often receive a bonus of 50% to 100% of their salary. In addition, a company car is often one of the usual additional benefits for managing directors.
In a GmbH, the shareholders' meeting decides how much a managing director earns. The sole shareholder on the management board therefore also decides their own salary.
Managing director tasks: What does a managing director do?
The tasks of the Executive Board are primarily the strategic orientation of the company, as well as the control, organisation and management of the company and its employees.
The daily tasks of managing directors can vary depending on the size of the company. In very large companies and groups, top management is often divided into different areas, such as finance, marketing and sales.
The management is responsible for the economic and operational progress of the company and bears the majority of the responsibility. It ensures that employees are able to fulfil their tasks and understand the meaning behind them. At the same time, it ensures that the company remains healthy and delegates management tasks to other managers in the various departments.
A large part of the management's tasks also involves representing the company to the outside world. Managing directors often come into contact with customers, competitors or the media. They must therefore be able to present themselves and the company professionally.
The most important tasks of managing directors include
Strategic planning: The management is responsible for developing and implementing the company's long-term strategies and goals.
- Corporate culture: It characterises the corporate culture and ensures that it reflects the values and goals of the company.
Compliance and risk management: The management ensures that the company fulfils all legal and regulatory requirements and identifies and manages risks.
Customer relationships: The managing director maintains relationships with important customers and partners.
HR management: A managing director hires qualified staff, promotes their development and ensures a positive working environment.
Financial management: monitors the company's financial performance, ensures that it is profitable and makes decisions on budgets and investments.
Duties of a managing director
In addition to tasks such as managing employees or making decisions about investments in new machines, a managing director also has certain duties. These duties are set out in various legal codes or in the management contract. These include, for example, convening the shareholders' meeting or duties of disclosure and information, as well as compliance with the duty of care towards employees.
In addition, the managing directors are obliged to minimise risk and preserve capital. To summarise, one of their greatest duties is to drive the business and its operations forward profitably.
How do you become a managing director?
Neither a degree nor any special training is required to become a managing director of a company. In principle, any natural person over the age of 18 with legal capacity can set up a company in Switzerland and appoint themselves as managing director. An alternative is to be appointed as managing director by the shareholders of a company.
Nevertheless, the reality is that management is expected to have a great deal of professional experience and often an academic degree. They need an understanding of business management and must have an in-depth understanding of both the industry and the product or service offered. Normally, the prospective managing director works their way up in the course of their career or sets up a company themselves after a few years in the profession. This process requires a lot of discipline and experience, as a career in management is difficult without the necessary expertise.
In principle, the shareholders on the Board of Directors decide who takes over the management of the company. Accordingly, they also decide which requirements must be met.
Training as a managing director
Training in business administration or commerce forms a good basis for a career as a managing director. Studies in these fields also provide a good starting point for the prospective managing director.
This is usually followed by several years of professional experience and further training before it is time for the top position in the company.
Nevertheless, there are now also degree programmes that prepare interested individuals for the tasks and challenges of management. The University of Applied Sciences Graubünden, for example, offers a Master's programme in General Management.
Further training as a managing director in Switzerland
Further training is extremely important for managing directors. After all, topics such as leadership, project management as well as business and legal knowledge are essential for management.
In addition, a managing director should set a good example and promote continuous training for employees.
Possible further training for managing directors:
Leadership and leadership skills
Industry-specific training
Negotiation skills
Cyber Security
Rhetoric and presentation
Change management
Difference between management and executive management
The terms management and executive management are often used interchangeably, but there are subtle differences. Management generally refers to the persons appointed by the shareholders or the board of directors of a company to manage and administer the company. They are responsible for the strategic direction of the company and make important decisions.
Management, on the other hand, can include a broader range of executives, including the management but also other senior executives such as department heads or division heads. They are responsible for implementing the strategies and objectives set by the management.
In smaller companies, these roles can often be filled by the same people, whereas in larger organisations there is a clearer separation between management and executive management.
What is a salaried managing director? Advantages and differences
An employed managing director has the same duties and obligations as non-employed managing directors. Only in some cases, which must be considered individually, does he/she count as an employee and can therefore also refer to the rights of employees. For many years, case law has been asking the question of whether managing directors are considered employees or employers.
In contrast to other employees, a salaried managing director, i.e. an external managing director in a GmbH, is liable with their private assets - just like a non- salaried managing director. Nevertheless, shareholder managing directors often have more power in the company, as they are also shareholders.
Difference between shareholders and managing directors in a GmbH
Although one person can fulfil both roles, there are certain differences between shareholders and managing directors. Shareholders participate in both profits and voting rights and are considered shareholders of a GmbH. Managing directors, on the other hand, are part of the management and - as already mentioned - can also be seen as employees in some cases. Nevertheless, the management also legally represents the company internally and externally.
Both roles can be performed by just one person or by several people. If a shareholder takes on the role of managing director, it is important to agree a managing director service agreement. This avoids conflicts with other shareholders and the tax office.
Skills of managing directors
A CEO needs a variety of skills that include both hard skills (technical or specific skills) and soft skills (interpersonal or "people" skills). These skills enable them to lead the organisation effectively, make strategic decisions, manage teams and lead the company to success.
Hard skills are specific, measurable and teachable abilities that are acquired through formal training and practice. Some of the most important hard skills for managing directors are:
Commercial and business management skills
IT skills
Analytical thinking
Sound knowledge of the industry
Project management skills
Strategic understanding
Leadership qualities
Willingness to travel
Teamwork
Time management
Stress resistance
Problem-solving ability
Communication skills
Top vacancies for managing directors: Jobs in Switzerland
FAQ
How much a managing director earns depends heavily on the industry and the size of the company. Managing directors in Switzerland often earn between CHF 250,000.00 and CHF 350,000.00 gross per year.
As a managing director, you manage the company, make strategic decisions and are responsible for achieving the company's goals. They also coordinate the various departments, ensure that company guidelines are adhered to and represent the company to the outside world.
The role of the managing director is often referred to as CEO (Chief Executive Officer). The word comes from the English language and primarily refers to the chairman of the board of a public limited company. The term has now also become established in Switzerland.
The Managing Director has the great responsibility of managing the company profitably and offering all employees a secure job. Strategic development and ensuring success are therefore particularly important.
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