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CEO stands for chief executive officer, and this position is typically the most senior role in a business or organisation. As the highest-ranking executive, the CEO is ultimately responsible for the success – or failure – of their organisation. 

The CEO title is typically used within for-profit businesses, although some non-profit organisations choose to use the term as well. Other possible terms used in the United Kingdom are executive director, president, managing director, or chief administration officer (CAO).

It’s also worth noting that some organisations use the CEO acronym differently. For example, they may use it as an abbreviation for their chief ethics officer or central executive officer. 

What does a CEO do?

The CEO of a business is responsible for:

• steering the organisation’s strategy.
• managing the company’s resources and business operations.
• strengthening the organisation’s financial position and reputation.
• overseeing transformation and change projects.
• setting business targets.
• ensuring robust policies and procedures are in place.
• demonstrating the values and behaviours expected within the organisation.

How a CEO spends their day will vary across organisations and sectors, but one Harvard Business School study found some common trends:

• 72% of their time is spent in meetings, with the remaining 28% of their time spent alone.
• The majority of meeting time (33%) is spent with direct reports.
• The majority of their interactions are face-to-face (61%), although the study was conducted prior to the coronavirus pandemic and the largescale shift to remote working that followed.

In terms of focus while working, there were a few key areas among the CEOs studied:

• People and relationships (25%)
• Functional and business unit reviews (25%)
• Strategy (21%)
• Organisation and culture (16%)
• Operating plans (4%)
• Mergers and acquisitions (4%)
• Professional development (3%)
• Crisis management (1%)

Where does a CEO fit in an organisational structure?

Within a corporate hierarchy, the CEO sits at the top, answering only to the organisation’s board of directors and its chairperson or chairman of the board, which is the group of elected individuals who represent shareholders.

Reporting into the CEO will be other senior professionals within the business. These professionals will likely include what’s often referred to as the c-suite, which can include a:

• chief operating officer (COO)
• chief financial officer (CFO)
• chief information officer (CIO) 
• chief business development officer (CBDO)
• chief marketing officer (CMO)
• chief communications officer (CCO)
• chief legal officer (CLO)
• chief technology officer (CTO)
• chief risk officer (CRO)
• chief creative officer (CCO)
• chief compliance officer (CCO)
• chief audit executive (CAE)
• chief diversity officer (CDO)
• chief human resources officer (CHRO)

Other direct reports could include a vice president – or multiple vice presidents – as well as other senior executives and key senior management roles.

Is the CEO the owner of a business?

While it’s possible for a company’s chief executive officer to also own the business, this usually only happens in smaller companies, startups, or organisations run by wealthy entrepreneurs. For example, Tesla CEO Elon Musk is both the owner and the CEO of SpaceX, the private spacecraft manufacturer and space launch provider.

Typically, however, CEOs are hired into their role, while owners have either founded the business or have a majority financial stake in it, and don’t oversee day-to-day operations of the business.  

How much do CEOs earn?

According to Indeed, the average base salary for CEOs in the UK is £54,491 – and this figure can increase significantly. For example, the average chief executive officer salary within the NHS is £221,858 per year, and Financial Times Stock Exchange (FTSE) 100 chief executives were paid £2.7 million on average in 2020. In fact, the highest paid CEO in the FTSE 100 is Sebastien De Montessus, CEO of the Endeavour mining company, who in 2021 was paid £16.9 million. 

What makes a good CEO?

From small businesses or global corporations, the CEO role is a varied one, requiring a varied skill set. Common areas of strength among successful CEOs include:

• Communication. Effective communication is necessary when sharing direction with direct reports and the wider organisation. Whether it’s about strategy or day-to-day operations, CEOs need to be able to share their ideas and directives clearly in order to get people on board to drive the work forward.
• Relationship-building. CEOs need to forge partnerships with everyone from their management team and other business leaders, to various stakeholders and even the general public. They are ideally sociable, trustworthy, and able to inspire loyalty in the people around them.
• Passion. Enthusiasm for their business and their sector is key if a CEO wants to motivate and inspire their staff – and their customers. Some of the most famous CEOs are the ones who are passionate about their fields, their products, and their companies. This can create similar zeal among staff, and attract the attention of the public.
• Curiosity. CEOs should take an active, hands-on role in the operations of their businesses. They should ask lots of questions about everything – product development, internal processes, and even the company TikTok account. A curious leader is always learning about their organisation – and using their knowledge to further drive growth and innovation.
• Critical thinking. The ability to think through options critically and make decisions confidently – based on research, data, and evidence – is crucial for a CEO. Organisations rely on their CEOs to make informed decisions, and this requires an ability to weigh potential outcomes and plan for success.

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