Chief Executive Officer (CEO)

A chief executive officer (CEO) is the highest-ranking executive in an organization. The CEO sets overall direction, makes major corporate decisions, manages senior leadership, and serves as the principal link between the board of directors and company operations. In many organizations the CEO is also the public face of the company.

Key takeaways

• The CEO is the top executive responsible for strategy, performance, and overall operations.
• Responsibilities vary by company size and structure: larger firms focus on high-level strategy; smaller firms may require hands-on management.
• CEOs report to the board of directors and are accountable to shareholders.
• Research estimates of CEO influence on company performance vary (studies cite figures such as ~45% influence on performance or ~15% of variance in profitability).

Core responsibilities

CEOs shape long-term strategy and ensure the organization executes toward that strategy. Typical responsibilities include:
* Defining and communicating the company’s vision, mission, and strategic priorities.
* Overseeing the allocation of capital and resources across the business.
* Building and leading the executive team; delegating operational duties to senior leaders.
* Monitoring organizational and financial performance using key metrics.
* Reporting to and collaborating with the board of directors; maintaining accountability to governance bodies.
* Representing the company externally—media appearances, investor relations, and public events.
* Setting the cultural tone and leadership norms that influence company behavior.

Time allocation varies by leader and firm. One study found CEOs spend much of their work time in meetings and relationship-building, with smaller shares devoted to strategy, culture, and crisis management.

Typical tasks

Depending on industry and size, a CEO may:
* Approve and prioritize strategic initiatives.
* Oversee implementation through senior executives.
* Engage with investors, regulators, customers, and partners.
* Review performance reports and adjust strategy.
* Lead major organizational changes such as restructurings or acquisitions.

Compensation and public profile

CEO pay can vary widely by company size and industry. Top-paid executives may receive multi-million-dollar compensation packages; averages for public-company CEOs are substantially higher than typical executive pay. Large-company CEOs often gain public visibility—positively or negatively—because of their leadership decisions and media presence.

Related C-suite roles and differences

Many senior executive titles compose the C-suite. Key distinctions:

Chair of the Board (COB)
– Leads the board of directors, which provides oversight of the CEO. The chair can be a separate role to strengthen governance; in some firms the CEO and chair roles are combined.

Chief Financial Officer (CFO)
– Focuses on financial strategy, planning, reporting, cash flow, and capital structure. The CFO typically reports to the CEO.

Chief Operating Officer (COO)
– Manages day-to-day operations, including human resources, procurement, and administrative functions. COOs often report to the CEO and handle operational execution.

CEOs in small or early-stage companies sometimes hold multiple titles (e.g., founder/CEO or CEO/CFO), which can blur responsibilities and create operational strain.

Other leadership titles

• Founder — Person who started the company; may or may not remain in an executive role.
• Chairperson — Presiding officer of a board or committee; can be distinct from the CEO.
• Owner — Equity holder in the business; ownership does not necessarily imply executive control.
• Director — Can refer either to senior management roles (e.g., divisional director) or to members of the board of directors.

Impact of CEO change

Leadership transitions can affect market perception and company performance. A new CEO can prompt stock-price movements based on:
* Investors’ assessment of the incoming CEO’s track record and industry experience.
* Expected changes in strategy, cost structure, or market approach.
* The strength of the broader executive team and the smoothness of the transition.

Unplanned CEO departures often carry more downside risk. Investors typically prefer leaders familiar with the company’s industry and operational context.

Common questions

Is the CEO the owner of the company?
– Sometimes. A CEO may also be an owner or founder, but many CEOs are employees appointed by the board.

Which is higher, CEO or CFO?
– CEO. The CFO reports to the CEO and focuses specifically on financial management.

Is there any position higher than CEO?
– The CEO is the top executive, but the board of directors oversees the CEO and has authority to hire or remove them.

Bottom line

The CEO is responsible for setting strategic direction, steering organizational performance, leading senior management, and acting as the primary liaison to the board and external stakeholders. The role demands strategic judgment, leadership, and the ability to balance short-term execution with long-term value creation.

Select sources

• Harvard Business Review — research on how CEOs manage their time and leadership effectiveness
• Equilar — compensation analyses of top-paid CEOs
• Chris Bradley, Martin Hirt, Sven Smit, Strategy Beyond the Hockey Stick: People, Probabilities, and Big Moves to Beat the Odds