Permissions are not propagated from the ESXi host to virtual machines

Products

• VMware vCenter Server

Issue/Introduction

Permissions are assigned on the ESXi host and "Propagate to children" is enabled.
However, virtual machines on the ESXi host don't have above permissions.
The virtual machines reside in a resource pool or a cluster.

Cause

It's expected behavior.

If a virtual machine resides in a cluster or a resource pool, it is treated as a child of the cluster or resource pool, not as a child of the ESXi host.

Resolution

Assign permissions to a cluster or a resource pool, or assign permissions to a virtual machine folder.