What is the difference between president and CEO?
Corporate governance deals with the structure, authority, and reporting relationships. This comprises the president, chief executive officer, and vice executive president among many others.
The lesson provides the difference between the president and CEO with a comparison table for better understanding. Let’s find out now.
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Meaning of President
President refers to the leader of an organization. It is the second-highest-ranking position in an organization and he or she is the head of the branch or division of a company.
The main role of the president is to lead, guide, direct and motivates the vice president, managers and other senior executives in the organization.
Meaning of CEO
CEO stands for Chief Executive Officer. It is the highest-ranking position in an organization and they are normally proposed by the company’s board of directors.
The CEO is responsible for increasing the wealth of the organization besides making macro decisions relating to the policies and objectives of the company.
Comparison Chart: President Vs CEO
| Basic Terms | President | CEO |
| Meaning | Refers to the second-highest ranking in an organization responsible for implementing policies and making operational strategies | This refers to the highest ranking in an organization responsible for increasing wealth and making macro decisions. |
| Positions | Second Highest | First Highest |
| Accountable for | CEO | Board of directors |
| Perspective | Short term | Long term |
| Main Focus | Profit maximization | Wealth maximization |
| Core Function | Implementation of policies and strategies | Formulation and planning of policies |
| Strives for | Efficiency | Effectiveness |
| Meaning of success | Growth | Sustainability |
| Result in | Performance | Legacy |
Difference between President and CEO
- CEO is the highest ranking in the organization while the president is the second-highest ranking in the organization
- The main role of the CEO is to set a long term vision while the president implement the policies to achieve the vision
- The core function of the CEO is operation management, strategy, and formation whereas the president is financial management and effective execution of strategies
- CEO report to the board of directors whereas the president report to a chief executive officer
- President subordinates the top-level management and vice presidents whereas the CEO subordinate the president, CFO, CSO, and CAO.
- CEO is involved in making macro decisions whereas the president is involved in making micro-decisions.
- President may or may not have seat on the board whereas the CEO has a permanent seat on the board
- The measurement of success of the president is growth while that of the CEO is sustainability.
- The prime focus of the president is profit maximization while that of the CEO is wealth maximization.
- The perspective of the CEO is long term while that of the president is short term
- The striving factor of the president is efficiency while that of the CEO is effectiveness
- The final result of the president is strong performance while that of the CEO is legacy
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Comparison Video
Summary
The core difference between the president and CEO is the ranking where the CEO is the highest-ranked position while the president is the second-highest. President strives for efficiency while CEO effectiveness.
More Sources and References
- https://en.wikipedia.org/wiki/Chief_executive_officer
- https://www.fortum.com/about-us/investors/corporate-governance/president-and-ceo
- https://www.thebalancecareers.com/what-does-a-president-do-1919122