Key points
- The corporate officer (mandataire social) is the person appointed to run and represent a company: president of an SAS, chairman and CEO (PDG) or chief executive officer (directeur général) of an SA, manager (gérant) of an SARL.
- They are not bound by a traditional employment contract, which deprives them of employee benefits such as severance pay and paid leave.
- Their responsibility covers administrative and financial management; misconduct can give rise to civil or criminal liability.
- Their remuneration is set by the competent body depending on the type of company and the articles of association, for example the board of directors for the chairman of an SA, outside standard salary norms.
- A distinction is made between de jure directors, who are duly appointed, and de facto directors, who run the company without any formal appointment.
- Combining a corporate office with an employment contract is possible under strict conditions of separate duties and subordination.
The status of the corporate officer is a central issue for any organisation wishing to understand the responsibilities and rights of the people at the head of its operations. In business, a corporate officer (mandataire social) is a person, most often an individual, appointed to represent and act on behalf of a company, overseeing its day-to-day management. This role has various legal and administrative implications that you need to understand clearly. To find out more, see our page management packages and BSPCE.
What is a corporate officer (mandataire social) in France?
A corporate officer is first and foremost a director responsible for representing a company towards third parties. Depending on the type of company, this may include a chairman and chief executive officer (PDG), a chief executive officer (directeur général), or even a manager (gérant) in the case of an SARL (private limited company). The chairman of the board of directors and the chief executive officer of an SA (public limited company), like the manager of an SARL, must be individuals (Articles L. 225-47, L. 225-51-1 and L. 223-18 of the French Commercial Code (Code de commerce)); the president of an SAS (simplified joint-stock company) can be a legal entity (Article L. 227-7). These directors have the power to take decisions on behalf of the company.
The particular role of the corporate officer directly involves them in the strategic and operational running of the company. They are not bound by a traditional employment contract, which affects the nature of their duties and their remuneration.
Responsibilities attached to the status
The main responsibility of the corporate officer is to ensure the proper functioning and long-term survival of the company. This includes administrative and financial management, implementing the policies decided by the board of directors, and safeguarding the shareholders’ interests. These directors therefore have considerable room for manoeuvre to carry out their duties.
Despite their wide powers, corporate officers must comply with various legal and regulatory obligations. Misconduct can give rise to civil or criminal liability. Vigilance and transparency are therefore essential in the performance of their duties.
What the absence of an employment contract means
Unlike ordinary employees, corporate officers are generally not bound to the company by an employment contract. This distinction essentially determines their position within the organisation. Without such a contract, they do not have access to the same employee benefits, such as severance pay and paid leave.
However, certain exceptions allow a corporate office and an employment contract to coexist if the duties performed are genuinely distinct from those of a director. The conditions are strict, requiring a clear separation in terms of hierarchy and subordination.
The impact on remuneration
The remuneration of a corporate officer is set by the competent body depending on the type of company and the articles of association; board members of an SA may receive a fixed annual sum allocated by the general meeting. As they are not employees in respect of their office, they receive remuneration that falls outside the usual norms of employment contracts.
This particular position can give rise to discussion, particularly about the levels of remuneration set, which must be reasonable and in line with the financial results of the business. The question of remuneration is essential, since it also affects the tax status of the corporate officer.
Types of corporate officers
Directors come in several forms, each with its own characteristics and obligations. A distinction is mainly made between de jure directors and de facto directors.
The former, who alone are true corporate officers, are appointed by the articles of association or by a decision of the competent bodies, whereas the latter actually run the company without any formal appointment. This distinction is important for determining the associated liability and rights.
Differences between types of companies
Depending on the legal structure, such as a public limited company (SA) or a simplified joint-stock company (SAS), the forms and titles of corporate officers vary. Each configuration imposes different rules affecting their powers and the regulatory framework to which they adapt.
In an SA, for example, the PDG often plays the main role with clearly defined responsibilities, whereas an SAS offers more flexibility to adapt the articles of association to the specific needs of the organisation. This varied context calls for careful thought about the implications of each option before taking on these roles.
Consequences of self-employed (TNS) status
Only certain directors have the status of self-employed worker (travailleur non salarié, TNS), in particular the majority manager of an SARL. SARL managers who together do not hold more than half of the share capital, the chairman and the chief executive officer of an SA and the president of an SAS are affiliated to the general social security scheme on the same footing as employees (assimilés salariés) (Article L. 311-3 of the French Social Security Code). For TNS, social contributions are calculated on earned income, not on turnover (Article L. 131-6 of the same code).
TNS must register with specific bodies for their health insurance, pension and so on. They enjoy more flexibility in managing their time but must anticipate potential variations in income. For some, this represents an additional challenge that it is crucial to grasp fully from the moment they take office.
Contribution systems and social protection
The contributions of self-employed workers are based on their earned income, not on a salary. This method of calculation follows the income actually received, but requires good management to anticipate all future obligations.
The level of contributions and the extent of social security cover for TNS differ from those of employees and vary according to income and schemes. Proactive management, or even supplementary cover, makes it possible to fill any gaps.
FAQs on the status of corporate officers
What is the main role of a corporate officer?
The corporate officer is in charge of the day-to-day and strategic management of the company. Their responsibilities include taking important decisions, representing the company towards third parties and ensuring legal compliance. Constant concern for the interests of the company and its partners is essential.
Is there a relationship of subordination between the corporate officer and the company?
No, there is usually no relationship of subordination between a corporate officer and the company, except in particular cases. This means that there is no employment contract governing their duties. However, a dual role could exist if an independent and distinct task is performed under specific conditions.
What types of corporate officers are there?
There are two main categories of directors: de jure and de facto. The former are officially appointed in the articles of association or by a decision, whereas the latter run the company without official formalities. Each category raises different issues of liability and rights.
How is the remuneration of corporate officers determined?
The remuneration of corporate officers is set by the competent body depending on the type of company: the board of directors for the chairman of an SA (Article L. 225-47 of the French Commercial Code), the articles of association or the shareholders in other forms. Board members (administrateurs) of an SA may receive a fixed annual sum allocated by the general meeting (Article L. 225-45). Remuneration often depends on the company’s performance and on the corporate officer’s responsibilities.
This page provides general information and does not constitute legal advice: every situation is different. For a specific matter, see our page lawyer in employment and social security law for directors (in French).
