Who has the most power in a company, CEO, President or a Chairman?

Question

Who has the most power in a company, CEO, President or a Chairman?

Answer 1

chairman

Answer 2

Ultimately the chairman, because the board of directors can generally give the president or ceo the axe if they choose to.  The CEO or President generally have much more involvement in day to day operations than does the chairman.  In many companies, one person holds more than one of the titles you ask about.

Answer 3

I have watched your question hang around, and was hoping that it would

be available when I had a few minutes, and lucky me, it was!

I have spent 30 years now in various corporate environments and have

seen practically every combination and permutation of corporate

structure. The one rule that I have learned is that there is no one

rule concerning titles relating to specific job functions.  But

nevertheless, let’s try to make some sense out of all of this.

1. Yes, members of a board of directors are sometimes informally

called “board members.”

2. “The governing body of a corporation elected by the shareholders is

called a board of directors.”  A board is usually composed of both

senior officers of the corporation (referred to commonly as “inside

directors”, and people who are not employed by the corporation, but

who serve on the board, for which they receive a fee, and these folks

are called “outside directors.”

3. The board is empowered to elect and/or appoint officers and agents

to act on behalf of the corporation. They also declare dividends, and

act on other major matters involving the corporation. They pay

attention to the “big picture” corporate policy issues, and (usually)

leave the day-to-day management issues to the officers of the

corporation.

4. The Board of Directors is almost always led by its Chairman – the

Chairman of the Board of Directors. Since the Board is charged with

executing “executive functions” the Chairman is, usually the CEO or

Chief Executive Officer. CEO’s may or may not have day-to-day

responsibility at the corporation, although these days you would

typically find the CEO is an officer of the company, maintains an

office in the corporate headquarters, and many times (though not

always) has “come up through the ranks” and has been a manager ‡ vice

president ‡ executive vice president ‡ president ‡ CEO.  Many people

analogize the President of the United States to a CEO. It is the top

job, but the day to day function is to set policy, make sure board

policy is being implemented and managed appropriately, and to

coordinate the activities of the policy setting Board with the day

–to-day operations of the company.   This is particularly true in

conglomerates, where the corporation owns a number of different

businesses, perhaps in different parts of the world, each perhaps with

its own president – all reporting to the CEO.

5. The President of a corporation is typically the Chief Operating

Officer – All of the operations report up through junior officers

(vice presidents) to the President. There will be vice presidents for

various divisions of the company, or for various important functions;

for example, there may be vice presidents for finance, marketing,

accounting (many times called a controller or comptroller),

information services, public relations, corporate affairs (also called

a secretary), law, and the various operating divisions.  There may be

a number of flavors of vice president:  Assistant VP, VP, Senior VP,

Executive VP – I’ve even seen Sr. Exec. VP.

6. The president’s role is to manage and be responsible for the

day-to-day affairs of the company.  The board sets policy, the

president executes that policy and reports back to the board, and the

board then reports to the shareholders, or owners, of the company.

7. The issue of inside directors versus outside directors is an

interesting one. Some companies believe that inside directors, at the

risk of losing their jobs if too outspoken, will not challenge their

superiors or think too far outside the box. Those companies would

therefore severely limit inside directors, perhaps only to the

president. All the other directors are outsiders, who are seen to be

better able to create and debate policy initiatives.

Other companies do the opposite – they are very much in favor of

stacking the board with inside directors, typically justifying this

structure with the theory that insiders know the company

extraordinarily well, are totally vested in the affairs and interests

of the companies, and are best able to determine the policies that

would best drive the company profitably into the future.

As an aside, I have served a number of years on various boards of

corporations, and have felt that boards comprising largely outside

directors were the most effective.  I have seen a lot of senior

corporate officers sitting on boards afraid to state their opinion

when they know their boss, also a board member, has a different

opinion on the topic. Typically, again in my limited experience,

boards with a large number of insider directors, many times but not

always, have a CEO who is very, very powerful and that power is

enhanced by minimizing outside director content on the board.

Keep in mind too that most outside directors are CEO’s in their own

companies and are serving on another company’s board because of their

success with their own company. They may be serving on a board in

their retirement so as to “keep an oar in the water.”

Here is an interesting article concerning the inside versus outside

director question: http://rev.tamu.edu/stories/02/071502-5....

8. Here then is the theoretical structure:

A. Shareholders

B. Board of Directors – led by its Chairman (who may be CEO)

C. CEO – (Chairman)

D. COO – President

E. Executive Vice Presidents

F. Vice Presidents

G. General Managers

H. Managers

I. Supervisors

J. Workers

Of course there are many permutations.

9. To really confuse things sometimes (at least it seems that way),

some corporations have an executive position called a “Director” that

is senior to a Manager or General Manager, but is junior to a Vice

President. This is particularly true in staff positions (like

accounting, marketing, etc.)  This “Director” position is not to be

confused, and is certainly not the same as a member of a Board of

Directors, also referred to as “a Director.”

I hope that I have been able to make corporate hierarchy more

understandable for you.  IF YOU HAVE ANY QUESTION, please click the

Ask for Clarification BUTTON and I will get right back to you.

Thanks for visiting us.

Weisstho-ga

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Answer 4

Sometimes it can be all of the above, because some CEO's buy proxy votes and vote themselves and their henchmen into a chairman position and being in the chairman position he can give himself the CEO job.

Proxy votes allows a shareholder to sell their ability to vote at shareholders meetings.  So the CEO could buy the votes through a proxy and even set his own salary.

Answer 5

What Carol C said - just be sure to review the layout of power in the particular company you're asking about. Sometimes companies customize their own hierarchy, and might call a person one of these titles but have a different job description for them than another company would. It can get a little confusing.

But as far as I know, in most cases, it would go like this, from highest to lowest:

Chairman (provided they have the power to fire/hire the president)

President

CEO