Secretarial Practice · Ch 6 — Directors and Key Managerial Personnel of a Company
Distinction between Director and Key Managerial Personnel
7
Distinction between Director and Key Managerial Personnel
7. Distinction between Director and Key Managerial Personnel
Students preparing the Maharashtra HSC Secretarial Practice Std XI syllabus most often lose marks by
blurring "director" and "KMP" into one idea — they overlap (a Managing Director or Whole-time
Director is both at once) but are conceptually distinct roles created for different purposes:
| Basis | Director | Key Managerial Personnel (KMP) |
|---|---|---|
| Governing section | Section 2(34) | Section 2(51) |
| Role | Policy-making and oversight, as a member of the Board | Whole-time execution of the Board's decisions |
| Membership | Member of the Board of Directors | May or may not be a Board member (a CFO or CS usually is not; an MD/Whole-time Director is) |
| Employment status | Not necessarily an employee — a non-executive/independent director draws only sitting fees/commission | Always a whole-time, salaried employee/officer |
| Who must have one | Every company (minimum 1–3 depending on type) | Only listed companies and public companies with paid-up capital ≥ ₹10 crore [Section 203] |
| Number of such offices per company | Can be many (up to 15, or more by special resolution) | A fixed, named short list (MD/CEO/Manager, CS, Whole-time Director, CFO) |
| Appointment | By members in general meeting [Section 152], or by the Board for additional/alternate/nominee/casual-vacancy directors | By resolution of the Board [Section 203] |