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Chief executive officer
- For other uses, see Chief Executive (disambiguation)
In closely held corporations, it is general business culture that the office of Chief Executive Officer, CEO, is also the chairman of the board. Specifically, one person shares the chairman and CEO titles while another person takes the presidency or may become chief operating officer (COO). Regardless, in virtually all cases where the CEO and president are not the same person, the CEO and President are of equivalent rank. However, the term president is from the U.S. and in the UK COO is favored. Underneath that comes the Executive Vice President (U.S.) or Executive Director (UK). In publicly held corporations, the CEO and chairman positions can be separated but there are implications in corporate governance by doing so.
In some European Union countries, there are two separate boards, one executive board for the day-to-day business and one supervisory board for control purposes (elected by the shareholders). In these countries, the chief executive officer presides over the executive board and the chairman presides over the supervisory board and these two roles will always be held by different people. This ensures a distinction between management by the executive board and governance by the supervisory board. This allows for clear lines of authority. The aim is to prevent a conflict of interest and too much power being concentrated in the hands of one person.
In rare circumstances an Executive Chairperson can be appointed but this is either illegal in many jurisdictions or frowned upon by Regulators.
In the United Kingdom many Charities and Government Agencies are headed by a Chief Executive who is answerable to a Board of Trustees or Board of Directors. In the UK, the Chairman (of the Board) in public companies is more senior than the Chief Executive. Most public companies now split the role of Chairman and Chief Executive.
Qualified CEOs of corporations should have leadership skills and be able to act decisively regarding human, financial, environmental and technical challenges that face a corporation. They should have strong inter-personal skills and be familiar with Human Resources, Accountancy/Finance, Marketing and improving through a structured approach that is inline with the owners orientation to risk. They must then report to the Board of Directors in the annual meeting. Currently, many of the CEOs are MBA or DBA educated with qualified accountants such as ACCA, CA or CPA qualification.
Typically, a CEO has a cadre of subordinate executives, each of which has specific functional responsibilities. These direct reporting relationships most often include: Chief Financial Officer, Chief Operating Officer, Chief Marketing Officer, and Chief Information Officer. Although not an Executive, the Director of Human Resources plays a vital role within any corporation.
However, depending on the industry in which the company operates and/or the organizational structure the company has employed, various other functional areas may be highlighted through the CEO's direct span of control. Some of these less common monikers include: Chief (Business) Development Officer, Chief Knowledge Officer/Chief Learning Officer, Chief Strategy Officer, Chief Risk Officer, and Chief Credit Officer.