CEO stands for the Chief Executive Officer, which is the highest rank of management in any company. They perform the most critical functions of decision-making regarding operation management, resource utilization, and critical corporate functioning.
Selection of the CEO
CEO is the bridge of communication between the board of directors and management of the company. The CEO is selected by the voting of board members and shareholders.
The typical corporate structure of a company
Typically, the organizations maintain a two-layered hierarchy, one linked with top level management and the other with the board of directors. Board directors are elected by the shareholders and have the major authority of the organization. The board of directors then elect the chairperson and the chief executive of the organization. The CEO recommends the COO, and the CFO and final selection is made by the board.
Responsibilities and roles of a Chief Executive Officer (CEO)?
The primary responsibility of the CEO is to make corporate major managerial and executive decisions. As a CEO, the person is responsible for the organization’s success and failure because he controls all the highest executive functions. A good CEO takes ideas and input from the employees involved, but the CEO solely holds the decision-making authority. Some companies may assign different titles to the CEO, like the chief, president, or managing director (MD).
There are no hard and fast rules for the responsibilities of the CEO, and the roles and responsibilities vary from organization to organization. It depends on its culture, corporate structure, size, and various observable and unobservable factors. The CEO of the larger companies have the role of making top-level managerial and strategic decision making, directing the company towards success.
They are not involved in direct interactions and day-to-day activities of the company. While in smaller companies, the CEO is more involved with the employees and sets the company’s vision, tone, and strategic direction. The CEO is also an active entity in developing the culture of the organization. In various companies, CEOs are involved in public interactions and thus become famous. The best example is “Mark Zuckerberg,” the CEO of Facebook, and Steve Jobs, founder, and CEO of Apple. They have now become the global icon due to their direct and robust connection with the general public.
As we know that there is no standardized set of rules that govern and dictate the responsibilities of CEO. However, the range of duties and typical job description apart from strategic and managerial decision making is mentioned below:
The CEO has to communicate essential decisions from the board and shareholders to the employees, government, and public.
The CEO is responsible for leading the corporate strategy, setting objectives, and deciding the organization’s short and long goals. After setting vision and objectives, they have to make crucial decisions to ensure its implementation.
The CEO also performs the duty of evaluating the functions and responsibilities of other decision-making and managerial bodies like the vice president, directors, and sometimes employees.
To maintain awareness of the brand in the public and competitive market in employees is often performed by the CEO. They are responsible for finding and utilizing opportunities by analyzing the competitive market.
5. Ensuring corporate social responsibility (CSR)
The CEO makes sure that the organizational policies are in alignment with the corporate social responsibility.
6. Risk analysis
The assessment of the risks and making strategic decisions that ensure the minimization of risk is another important function performed by the CEO.
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- Chief Commercial Officer (CCO)
- Chief Financial Officer (CFO)
- Chief Human Resources Officer (CHRO)
- Chief Information Officer (CIO)
- Chief Marketing Officer (CMO)
- Chief Purchasing Officer (CPO)
- Chief Technology Officer (CTO)
- Chief Sales Officer (CSO)
- Chief Risk Officer (CRO)
- Chief Legal Officer (CLO)