Deciphering the Role of Directors in Corporate Governance: Management Board vs Board of Directors in Poland
This article is a chapter of the ebook “Shielding Directors: A Practical Guide for Foreign Directors of Polish Companies” — see the full table of contents or download the complete ebook (PDF).
Before discussing liability, we must agree on who, exactly, is liable. This is not pedantry. The single most common misunderstanding among foreign executives in Poland is terminological, the difference between a management board and a board of directors, and it has direct financial consequences.
One-tier vs two-tier board structure: where Poland stands
Corporate governance worldwide runs on two architectures. The one-tier (monistic) model, dominant in common law jurisdictions, gathers executive directors, non-executive directors, and the supervisory function into a single body: the Board of Directors. The Delaware General Corporation Law is the classic expression, with the board directing the management of the corporation and delegating supervision to committees (audit, risk, compensation) staffed largely by non-executives.
The two-tier (dualistic) model, dominant in continental Europe and adopted by Poland, splits the same functions into two separate organs. The management board (zarząd) runs the company and represents it externally; the supervisory board (rada nadzorcza) oversees the management board but does not manage. A supervisory board member does not conduct the company’s affairs and, crucially, does not bear the management board’s statutory liability for the company’s debts.
The translation key is therefore this: an “executive director” in the one-tier world corresponds to a member of the management board in Poland; a “non-executive director” corresponds to a member of the supervisory board. Throughout this guide, “director” means a member of the management board, the person in the line of fire. (Since 2021 Polish law also offers the simple joint-stock company, prosta spółka akcyjna, which may adopt a one-tier board of directors. The liability mechanics described here extend to that vehicle too, so the choice of architecture offers no escape hatch.)
The false friend: the Polish “dyrektor” is not a director
Now the trap. The Polish word dyrektor sounds like “director” and means something else entirely. In Polish corporate practice a dyrektor is an internal officer: a dyrektor finansowy is a CFO, a dyrektor zarządzający a managing director in the operational sense. These people may run substantial parts of the business, but unless they hold a power of attorney or a commercial proxy (prokura) they cannot represent the company externally, and, the point that matters here, they are not subject to the statutory transfer of the company’s debts. An officer answers for their own wrongful acts under general civil law; they do not answer for the company’s unpaid invoices.
The asymmetry is worth stating bluntly, because foreign executives routinely get it backwards. In the United States, a senior officer’s title signals exposure; in Poland, the dangerous words are not dyrektor but członek zarządu, member of the management board. A consultant who lets the company register them as a board member “just as a formality” has assumed the full liability described in the chapters that follow. A powerful country manager who runs everything but sits on no board has, for the purposes of Article 299, assumed almost none of it.
Who bears director liability in Poland: a translation table
| Anglo-American term | Polish equivalent | Automatic debt-transfer liability? |
|---|---|---|
| Executive director / board member | Członek zarządu (management board member) | Yes — Art. 299 CCC, Art. 116 Tax Ordinance |
| Non-executive director | Członek rady nadzorczej (supervisory board member) | No — general fault-based liability only |
| Officer (CEO, CFO, COO as employees) | Dyrektor (e.g. dyrektor finansowy) | No — liability for own wrongful acts only |
| Liquidator | Likwidator | Yes — Art. 299¹ CCC (since 1 January 2016) |
One refinement to the table: since 2016, liquidators of a limited liability company answer on the same terms as management board members (Article 299¹ CCC). Accepting a “winding-down mandate” in a distressed Polish company is therefore not the low-risk housekeeping role it may appear to be.
Having fixed who is liable, the next chapter turns to how much, and shows why, for those people, limited liability in Poland is far more limited than they think.
Read the Full Guide
This chapter is part of the ebook “Shielding Directors: Navigating Personal Liability in Times of Financial Turmoil and Insolvency — A Practical Guide for Foreign Directors of Polish Companies.”
This article is general information, not legal advice. © Kancelaria Prawna Skarbiec
Robert Nogacki is a Polish attorney at law (radca prawny), the founder and managing partner of Kancelaria Prawna Skarbiec (Skarbiec Law Firm), which has operated continuously since 2006.
The law is equal for everyone, but the parties rarely are: on one side stands an organization with time, money, and lawyers, on the other a person with one business, one nest egg, and one life.
Clients rarely come to him with a legal problem. They come with a problem that also has a legal side: an audit that began with a single invoice, money entrusted to someone who has disappeared, a company that has to be passed on before it is too late. Most such matters are decided long before the first letter is written, in decisions made without asking and in deadlines nobody remembered. So he begins by asking how the client got here, not what the client should have done.
He advises entrepreneurs and families from more than a dozen countries, including those whose accounts the tax office has just seized and who do not know what to do tomorrow morning. He defends them in tax audits, customs and fiscal inspections, disputes with the tax authorities, and criminal tax proceedings. He represents victims of investment fraud and Ponzi schemes. He helps families set up family foundations and plan succession, so that a life’s work outlasts a single generation.
Not every case can be won. Every case can be run so that the client knows where they stand. Since 2006 he has represented the victims in the WGI case (Warszawska Grupa Inwestycyjna, the Warsaw Investment Group), one of the longest criminal cases in the history of the Polish financial market, because some things must not be left half finished, even when they take two decades. In the case of the collapsed cryptocurrency exchange Zonda (Zondacrypto, operated by BB Trade Estonia OÜ), he represents several hundred victims in the criminal investigation conducted by Poland’s National Prosecutor’s Office and in the Estonian bankruptcy proceedings.
Kancelaria Prawna Skarbiec is listed in the rankings of Poland’s largest tax advisory firms published by Dziennik Gazeta Prawna and Rzeczpospolita, and it is a four-time recipient (2015 to 2018) of the European Medal awarded by the Business Centre Club and the European Economic and Social Committee. Robert Nogacki publishes regularly, in the press and on the firm’s website, for people who have a problem rather than a law degree, because a legal opinion the client cannot understand protects only the lawyer.
He believes that the best legal advice is the kind that means the client never has to appear in court.
