What are the Duties of a managing director in a company?​

The duties of a managing director in a company might sound impressive on paper, but what do they actually involve in practice? What’s legal, what’s day-to-day, and is there a secret handshake? 🤝

In this guide, we’ll break it all down – from the must-dos to the nice-to-knows. Whether you’re going it alone or managing a team, here’s what you need to know. 🙌

What is a managing director?

They often sit at the top of the management structure and are responsible for making major business decisions and helping the company achieve their goals. 📈

And depending on the company’s size, the managing director might also be the only director, so the duties of a managing director may include everything from strategy to administration.

The key duties of a managing director in a company

Let’s take a closer look at the core duties of a managing director in a company, whether you’re running things solo or with a whole team:

1. Strategic planning

You’re responsible for guiding the company in the right direction. This means:

• Defining company goals and strategy
• Making high-level decisions about growth, pricing and investment 💸
• Leading new product or service development

2. Overseeing operations

You’ll also need to make sure the business runs smoothly on a daily basis. This might include:

• Managing staff (or contractors)
• Delegating tasks 
• Overseeing customer relationships
• Monitoring performance against goals 👀

3. Taking care of the legal stuff

As an MD, you’re still a company director – so all the standard legal duties of directors apply too. These include:

• Acting in the company’s best interests
• Avoiding conflicts of interest
• Keeping proper financial records 📂
• Filing annual accounts and confirmation statements with Companies House
• Paying the correct taxes on time

4. Managing finances

While you might have an accountant or bookkeeper on board, you’re still ultimately responsible for the company’s finances as an MD. Your financial duties might include:

• Approving budgets and spending ✅
• Making sure the company stays solvent (doesn’t run out of money)
• Reviewing cash flow and forecasts

5. Communication and reporting

An MD is also the main point of contact for stakeholders. That means:

• Reporting to shareholders (if there are any)
• Communicating with HMRC and Companies House
• Keeping investors or lenders updated (if applicable)

Do the duties of a managing director include being a shareholder?

Nope. A managing director doesn’t have to be a shareholder in the company. This works both ways, as shareholders don’t automatically get director status either. You can be one, the other, or both.

Do managing directors get paid a salary?

Yes, managing directors usually take a salary.

How much you pay yourself (and how you split salary vs dividends) depends on your business income, tax bands and whether you have other employees. 👥

If you’re both a managing director and a shareholder, you might also be entitled to dividends as well as a salary. 

Can the duties of a managing director in a company be shared?

You bet. While the managing director usually takes the lead, the company can have other directors. In fact, it’s common, and they often focus on specific areas like finance, operations, or marketing.

Final thoughts: duties of a managing director in a company

Whether you’re flying solo or managing a growing team, the duties of a managing director in a company are no small task. From strategy and finances to legal compliance and operations, you’re the one making it all happen. ✨

But don’t worry, you don’t have to do it alone. From tax returns to director salaries, we’re here to help you make sense of it all, without the stress.