We have all heard of a Chief Executive Officer, but not everyone necessarily understands what exactly the role of a CEO is and what such a person does every day. The CEO of a company is appointed by the shareholders and the BOD. CEOs report to the chairman of the board and is the executive that ranks highest in a business. The primary responsibility of the Chief Executive Officer is to make all significant corporate decisions and manage company operations and company resources. They are the middle man between corporate operations and the BOD.
There are some nuances to the role of a CEO that cannot be captured in a job description. Understanding these comes with experience, but there are some facts that might help a person on their journey through learning more about the responsibilities of a CEO.
A CEO job description will vary slightly between companies. Elements that usually impact a CEO job description are the corporate structure, the company culture, and the size of the company. In small businesses, CEOs are more involved and take part in the daily functions and operations of the business. In larger companies, CEOs are only involved with top-tier decisions and things that directly impact the growth of the company as a whole.
The CEO works closely with the senior leadership team and the Board of Directors. They are responsible for financial, strategic, and operational leadership in a business.
The responsibilities of the Chief Executive Officer mirror those of the company president or business owner. Let us take a closer look at what the primary CEO responsibilities usually are.
There are some essential leadership traits that a CEO needs to possess in order to function optimally in their role.
A CEO needs to be able to communicate effectively on all levels. They are ultimately accountable for actions taken everywhere in the business, and it will be up to the CEO to ensure that staff understand the company’s culture and what is expected of them. The CEO continually drives effective results, which means that they model behavior that will lead the organization to success.
As is often evident in a CEO position description, excellent leadership skills and ability to manage people is necessary for success. This goes hand-in-hand with the aforementioned communication skills, but also encompasses skills like outstanding problem solving skills, decision-making, empathy, etc, that are usually associated with a strong leadership ability.
Furthermore, a CEO requires professional business acumen. Simply being able to manage people is not enough on its own. The CEO job also involves the savvy to take the business in a strategic direction that ultimately brings favorable results to business operations and revenue. For this they also require a strategic mindset.
The educational requirements for CEOs are competitive and differ slightly depending on the industry. For example, the education requirements for a hospital Chief Executive Officer is not the same as for a financial institution CEO. This means that the requirements we list below are generic.
Industry specific differences would lie in education requirements and the type of experience that a candidate has in their respective industry.
The role of the CEO within an organization can be confusing when compared to other executive roles and the board. The board of directors is headed by the chair of the board (COB) who oversees the company in its entirety. The CEO takes responsibility for the operational aspects of the business. The chair is not capable of overruling the board, but the board is able to overrule decisions made by the CEO. That means that the chair is on the same management level as other board members. But the board as a whole is above the CEO. In special cases the chair of the board and the CEO is the same person, but the majority of corporations split the roles and provide two different job descriptions based on business needs.
In cases of significantly large corporations CEO changes are reflected in the markets. The response can be either negative or positive. This is due to the impact that a CEO can have on the company’s performance.
Changes in stock prices due to projections of how a company might perform under the new CEO are common, but it is difficult to say which way the stock will really go when a CEO changes. Generally speaking, however, there is most often an initial drop in price due to the risks involved in a CEO change. One factor that impacts the market’s response is the CEO’s agenda, specifically whether they plan to make changes to the existing C-suite and how the market feels about predicted changes. The CEO’s reputation also reflects in the market response.
The first paragraph contains a few sentences related to what you are looking for in terms of the role you are advertising. For example:
We are seeking a CEO with experience in managing the everyday operations of our corporation. The ideal candidate is prepared to model and build an efficient and supportive company culture, provide expert financial guidance and inspired leadership to our C-suite, and maintain great professional relationships with the board of directors.
A list of what the CEO is expected to do will be provided here. For example:
This list is more specifically related to what a candidate needs in their resume to be considered for the position:
A CEO usually has many different duties in a business. Their key responsibility is usually to work with the CFO on banking relationships and other strategic financial partnerships.
The CEO job description is a document that stipulates exactly what the responsibilities and duties are of a CEO. A CEO job description can differ slightly between companies or industries, but there are also some generic responsibilities that a CEO has. These are listed above in our CEO job description template.
The CEO takes on the role of highest ranking executive leadership. They, therefore, take on the responsibility for the entire executive team.
Other C-suite positions that may be impacted by a change of CEO are: