Chairman vs. President

Difference Between Chairman and President

As time flows, the organizational structures have become larger and more complex than ever. You end up hearing classification for various administrative positions often befuddling to the common people who can not distinguish the difference between a Chairman and the President, let alone COO, CEO and many more such positions. This article intends to focus on the differences between the Chairman and the President.

Chairman of a company is usually the chairman of the board of directors who direct the affairs of the company. The Chairman is the head of council and in almost all cases, there is also the President who is the real head of the company. The Chairman is not directly involved with the operations of the company. Even the title of President is, in most cases, honorary and when you hear terms like the President and Chief Executive Officer and the COO you see the clear-cut and well-defined roles and responsibilities such positions.

When there are both President and the Chairman in a company, the President keeps the Chairman of the Board informed of developments in the company on a regular basis and also whenever there is a meeting of the Board of directors. In companies of small and medium size, it is possible for the same person to hold the titles of both the Chairman and President.

In large companies, to prevent power being concentrated in the hands of a single person, the roles of Chairman and President are performed by different people. This is also done to avoid any clashes between the governing team and the team of management.

The President is often subordinate to the Chairman. He is responsible to the Board of Directors and the Chairman for the performance of the company. When President also gets the responsibility of CEO, he is the most powerful officer of the company, but remains answerable to the Chairman. The President and the CEO are the master and everyone in the management team looks up to him for guidance.

The Chairman of the board of directors is often elected by the shareholders and is responsible for protecting the financial interests of shareholders and is more concerned of the company’s profitability and stability. He, with other board members discusses and evaluates the performance of managers at higher levels. The Chairman has the power to vote out the President of a company. On the other hand, the President is the face of the management in a meeting of the board of directors monitored by the Chairman.

 

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