They are responsible for upholding and promoting ethical practices, ensuring compliance with relevant laws and regulations, and overseeing effective risk management. Their commitment to good corporate governance fosters trust among stakeholders and contributes to the long-term success and sustainability of the organisation. On the other hand, an executive chairperson will have other jobs and responsibilities at the company, so they will take a more active role in running the company.

What is the relationship between the President and other C-suite executives?

• With tools like digital board solutions, the CEO can facilitate quicker, more efficient decision-making, ensuring the organisation remains agile and competitive in a fast-paced market.
• This role involves setting strategic goals, making high-stakes decisions, and leading the executive team to achieve the company’s objectives.
• On the other hand, the CEO tackles problems in the company’s daily operations.
• However, it is the board of directors that votes to increase executive pay.
• Unlike a non-executive chairman, who may not have an operational role, an executive chair is actively involved in the day-to-day management and decision-making of the company.

These situations often demand speed, singular vision, and deep operational expertise. While both roles are at the apex of corporate leadership, their specific duties are distinct and complementary, creating a system of checks and balances that is vital for sustainable success. Chairmen reinforce governance by separating strategic supervision from executive power, with nearly 70% viewed as key to board independence. The Chairman maintains a discreet and formal public presence, primarily engaging during pivotal moments such as CEO appointments, governance announcements, or organizational restructuring. Their communication is measured, often limited to official statements or annual reports. This restraint ensures that their authority remains rooted in governance, not publicity, preserving board neutrality.

Participant Experience

While the CEO is responsible for day-to-day operations, the executive chair provides insights to the executive team. As they typically have more experience and expertise, executive chairmen act as a sounding board for the CEO; they guide and support the latter in navigating complex challenges and opportunities. While the Chairman technically has higher level powers, the CEO is indeed “the boss” of a company. And yes, the CEO does (by the letter of the law) answer to their board of directors, which is ultimately headed by the chairman. Book a demo with Boardwise to see how they can support your organization in optimizing governance and leadership structures. At Apple, Tim Cook serves as CEO, while Arthur Levinson holds the Chairman position.

In times of crisis, the CEO must take charge and lead the company through challenging situations. This includes developing and executing crisis management plans, communicating effectively with stakeholders, and making swift decisions to mitigate the impact of the difference between chairman and ceo crisis. The CEO’s ability to remain calm and composed under pressure is essential for navigating the company through turbulent times. This involves identifying new business opportunities, investing in research and development, and fostering a culture of innovation within the organization. The CEO must be proactive in exploring new markets, products, and services to ensure the company’s long-term growth and competitiveness.

• CEO – Chief Executive Officer This is the highest-ranking role in a company.
• Studies show that over 90% of media appearances and earnings calls are led by CEOs, whereas Chairmen are rarely in the spotlight unless during leadership transitions or crises.
• But the dual roles of CEO involve several governance risks, including conflict of interest and excessive concentration of power.

A non-executive chairman is a member of the board who is not involved in the day-to-day management of the company and typically provides independent leadership and oversight. In conclusion, the Chairman plays a crucial role in the success of an organisation. By leading the Board of Directors and steering the strategic direction of the company, they ensure effective governance and decision-making. The Chairman of the board holds a crucial role in an organisation as they lead and manage the Board of Directors. Their responsibilities revolve around providing leadership, setting expectations for the Company’s culture, and creating an environment for constructive discussion and informed decision-making. The Chairman’s role is essential in steering the strategic direction of the organisation and ensuring good corporate governance.

Roles and Responsibilities of CEO vs Chairman of the Board

A Chairman is a leadership figurehead who leads the board but may not be involved in the day-to-day activities of the company. A Non-Executive Chairman, in particular, provides oversight and governance but does not partake in the company’s strategic decision-making. A CEO is the face of the company and typically reports to the board of directors. They are tasked with implementing the strategies and decisions approved by the board, ensuring that the company meets its financial and operational goals.

Executive Chairman vs CEO: What’s the Difference

These hierarchies are essential for ensuring efficient management, clear communication, and effective decision-making processes. Understanding the different levels and positions within a corporate hierarchy is crucial for comprehending how organizations operate and achieve their goals. This article aims to demystify the corporate hierarchy by exploring the differences and similarities between the CEO and the Chairman.

This high-touch leadership style allows the CEO to respond quickly to changes in the market, allocate resources efficiently, and maintain organizational agility. Their proximity to operations is what empowers them to implement immediate solutions and drive execution at every level. The CEO is typically the highest-ranking executive in the company’s management team. At the same time, the Chairman holds the top position on the board of directors, overseeing the CEO’s actions and the company’s long-term vision. According to executive structure analyses, over 85% of large corporations globally separate the roles of CEO and Chairman to maintain clear governance. As the term implies, a non-executive chairman is a member of the board of directors who holds the position of chair but does not have an executive role within the company.

A CEO is an organization’s chief executive, overseeing day-to-day activities and making important decisions by collaborating with senior leadership. However, the CEO has much more far-reaching responsibility when it comes to conflict resolution, as they preside over conflict resolution within the company’s operational sphere. This could include conflicts among employees, departments, or even entire business units. Moreover, the CEO possesses the power to fire particular individuals from the company if deemed necessary. CEOs must also oversee the company’s compliance with a variety of regulatory bodies. This can include regular reporting and frequent monitoring of internal controls to ensure compliance.

According to the Harvard Law School Forum on Corporate Governance, the median S&P 500 CEO tenure is 4.6 years, with about 8% spending 20 years or more in the role. The Executive Chair position is generally secure and well-protected due to its governance power and oversight extension outside of performance-related measures. Its longevity is also due to the frequent occurrence of company founders undertaking the Executive Chair position. The CEO and Executive Chair are both responsible to the company’s shareholders, whose best interests they are bound to serve and protect. The compensation relationship between CEOs and other executives often reflects organizational hierarchy as well as the authority, expectations, and accountability of each position. As with most top-tier executive positions, compensation details of public companies are disclosed in regulatory filings.

The Combined CEO and Chairman Role

The Chairman is legally responsible for ensuring the board functions transparently and ethically, holding the CEO and executive team accountable for compliance and corporate integrity. Their fiduciary duties include duty of care, loyalty, and oversight of risk management. While not involved in execution, they must ensure that governance processes are in place and functioning. Their role is to maintain legal equilibrium between leadership decisions and shareholder protection, ensuring that no executive power undermines ethical or lawful conduct. The CEO’s reporting line runs directly to the board of directors, making them answerable for the company’s operational, financial, and strategic outcomes. Regular updates, quarterly reviews, and board meetings form the backbone of CEO accountability.

They are also responsible for making crucial strategic decisions that shape the direction and future of the organisation. Responsibilities of CEO and President vary based on company’s mission, services or products, and strategic goals. A Managing Director or simply CEO is focused on some major issues of company’s performance.