Executive Compensation : Ceo And Chairman Of The Board

1331 Words Dec 9th, 2015 6 Pages
There has been a dilemma about appointing the same person as a CEO of the company and the Chairman of the board. That person could gain too much power in their hands and act not in best interests of the company. These two roles often go side by side, conflicting one another, on the other hand. Some critics were arguing about time management and combining management control and governance in one person’s hands. Another argument is that person might gain so much power that he will not act in best interest of the company or the board won’t be able objectively evaluate his performance (in case of executive compensation).
My research paper will include next arguments:
• Who are the CEO and the Chairman of the company and their roles
• Combined
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The Chairman, on the other hand, is a head of this board. The Board is usually elected by shareholders to oversee management, and protect the interest of the shareholders and align them with company’s goals and interests; such interests include stability and growth. The meetings normally take place several times a year to review proxy, financial statements, overview company’s performance, and vote on important strategies. However, the Chairman doesn’t play an active role in everyday management. The chairman will usually:
• Ensure effective operation of the Board and committees
• Ensure effective communication with shareholders
• Set agenda focused on strategy, growth, and long-term performance
• Promote agenda on debate, internal control
• Manage the Board
• Ensure that the information received in timely manner by the Board is accurate
• Delegation of authorities
• Proper disclosure
• All committees are properly established and operated
• Ensure that the company maintain a dialogue with its shareholders
• Balance, diversity
• Establish a harmonious and open relationship with all executives and the CEO .
The balance between these two roles varies from industry to industry, or business of the company. CEO is not in power to make any major decisions without

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