Question

BUSINESS AND SOCIETY
1 PAGE ESSAY QUESTION
(I'll give you thumbs up.)

In your opinion, should the same person be both CEO and Chair of the Board of Directors?

Answer 1

CEO :

• CEO is the top level decision maker of an organization.
• He delegates responsibilities, goals etc to other managers down the hierarchy.
• CEO is ultimately accountable to the board of directors.

CHAIRMAN :

• The chairman is the head of the board of directors of an organization.
• He is responsible for the stakeholders and investors of the company.

Should same person be both CEO and Chairman:

• In my opinion, I think the same person should not be both CEO and Chair of Board of Directors.
• CEO deals with organizations management and Chairman of board deals with market value, board, and governance. It is difficult for the same person to get management and board perspectives which should be different.
• Board and chairman have a governing responsibility of the organization. If CEO is the Chairman. there might be conflicts of interest in governance and evaluation.
• If the chairman is different CEO gets different viewpoints as well as challenges from the directors and the board.
• If Chairman is different, he can actually conduct meetings and open talks where there are conversations and new ideas inflowing from independent directors and CEO.
• If CEO is not the chairman, he can put his complete focus on the organizational policies and their execution in the company.
• The Chairman can have clear authority on behalf of the board to speak out if the company has a different CEO without any conflicts.