Chairman of the Board

The Chairman of the Board: A Guide to the Role of the Board Chair

The Chairman of the Board—a role more commonly referred to today by the gender-neutral titles Board Chair or Chairperson—is the highest-ranking member and the designated leader of a corporation's Board of Directors. This individual is entrusted with the ultimate responsibility for the board's composition, conduct, and overall effectiveness. Far from being a ceremonial figurehead, the Board Chair is the linchpin of the entire corporate governance framework, ensuring the board functions as a cohesive and diligent body.

The Chair's primary mandate is to lead the board, not the company. They are the "first among equals," elected by their fellow directors to guide their collective efforts in providing oversight, setting strategic direction, and holding management accountable. The quality of a Board Chair's leadership is one of the most significant factors in the long-term success and integrity of any organization.

This guide provides an in-depth exploration of the Board Chair's role within the United States. We will detail the extensive responsibilities of the position, analyze the critical and ongoing debate around combining the Chair and CEO roles, define the qualities of an effective leader, and explain how modern governance platforms like BoardCloud are essential tools for the modern Chair.

Defining the Role: What is a Board Chair?

The Board Chair is a Board Director who has been chosen by their peers to lead the board's proceedings and focus. Their fundamental role is to create the conditions necessary for the board to be an effective governing body. This involves a critical separation of duties from that of the Chief Executive Officer (CEO).

  • The Board Chair leads the Board of Directors. Their focus is on governance, oversight, board performance, and long-term strategic direction.

  • The CEO leads the Company. Their focus is on management, day-to-day operations, and executing the strategy approved by the board.

The Chair is responsible for setting a "tone at the top" that fosters a culture of integrity, accountability, and constructive debate. They must ensure that the board's dynamics are healthy and that all directors are engaged and contributing to their fullest potential.

The Core Responsibilities of the Board Chair

The duties of a Board Chair are extensive, requiring a unique combination of administrative discipline, strategic acumen, and diplomatic skill.

1. Presiding Over Effective Board Meetings

This is the most visible responsibility of the Chair. They are the ultimate owner of the Board Meeting process, from planning to execution.

  • Setting the Agenda: The Chair collaborates closely with the CEO and the Corporate Secretary to build the meeting agenda. A great Chair ensures the agenda is strategically focused on the most critical issues, not just a series of backward-looking reports.

  • Facilitating Discussion: During the meeting, the Chair guides the conversation, ensures that all directors have an opportunity to voice their perspectives, manages the allotted time for each topic, and steers the board toward clear decisions.

  • Ensuring Procedural Integrity: The Chair is responsible for conducting the meeting according to the procedural rules outlined in the company's Bylaws and established parliamentary procedure, ensuring that all actions, motions, and votes are handled correctly.

2. Leading the Board's Structure and Composition

The Chair plays a leading role in shaping the board itself to ensure it has the right skills, experience, and structure to be effective.

  • Committee Oversight: The Chair works with the Nominating and Governance Committee to appoint committee chairs and members, ensuring a balanced distribution of workload and expertise.

  • Director Recruitment and Onboarding: They are actively involved in identifying potential new director candidates and ensuring that newly elected directors receive a comprehensive onboarding experience.

  • Board Performance Evaluation: The Chair leads the board's annual self-assessment process, a critical tool for identifying areas where the board can improve its performance, dynamics, and processes.

3. Acting as the Liaison Between the Board and Management

The Chair serves as the primary communication channel between the board and the CEO. This crucial relationship requires a high degree of trust and candor.

  • CEO Counsel: The Chair often acts as a confidential advisor and mentor to the CEO, providing support and feedback.

  • Leading CEO Evaluation: The Chair is responsible for leading the board's annual process of evaluating the CEO's performance and setting compensation, typically working through the Compensation Committee.

  • Consolidating Board Feedback: The Chair synthesizes the board's questions, concerns, and directives into clear, consistent messages for the CEO.

4. Upholding Corporate Governance

The Chair is the ultimate guardian of the company's governance standards. They must have a deep understanding of the company's bylaws and governance principles and ensure that the board consistently operates at the highest level of integrity.

The Chairman and CEO Roles: A Critical US Governance Debate

In the United States, one of the most significant and ongoing debates in corporate governance is whether the roles of Board Chair and CEO should be combined in one person or separated.

The Combined Role (CEO & Chairman)

Historically, this has been a common model in many large US corporations. The CEO also serves as the Chairman of the Board.

  • Arguments For: Proponents suggest that this structure provides clear, unified leadership and a single point of accountability. It can streamline decision-making and ensure that the person with the deepest knowledge of the company's operations is also leading the board's strategic discussions.

The Separated Role (Independent Chairman)

Favored by many institutional investors and governance advocates, this model separates the two roles. The CEO runs the company, and an independent, non-executive director serves as the Board Chair.

  • Arguments For: This structure provides a more robust system of checks and balances. An independent Chair can provide stronger, more objective oversight of the CEO and the executive team. It eliminates the potential conflict of interest where the CEO is effectively in charge of the very body that is supposed to oversee them.

The Rise of the Lead Independent Director

As a compromise, many companies with a combined CEO/Chairman have established a strong Lead Independent Director role. This is an independent director who is formally empowered with specific leadership duties to counterbalance the combined roles, including:

  • Presiding over executive sessions of the independent directors (meetings held without the CEO present).

  • Serving as the primary liaison between the independent directors and the CEO/Chair.

  • Having final approval over board meeting agendas and information flow.

How BoardCloud Empowers the Modern Board Chair

The complexity of the Chair's role demands sophisticated tools. A secure board portal like BoardCloud is the essential digital toolkit for the modern Board Chair to fulfill their extensive responsibilities.

  • For Strategic Agenda Planning: The Chair can use BoardCloud's Agenda Builder to collaborate securely and efficiently with the CEO and Corporate Secretary, ensuring the meeting plan is strategic and all necessary documents are attached to the relevant items.

  • For Running Efficient and Focused Meetings: BoardCloud ensures all directors have instant access to the same, most current version of the Board Book on their preferred device. This allows the Chair to lead a focused, paperless meeting where everyone is literally on the same page. Features for tracking Attendance and Quorum simplify the procedural start to the meeting.

  • For Secure and Confidential Communication: The Chair can use BoardCloud's secure messaging to provide confidential counsel to the CEO or communicate with the full board between meetings, eliminating the significant security risks of using personal or corporate email for sensitive governance matters.

  • For Upholding Governance: The BoardCloud Document Repository provides the Chair with instant access to the company's bylaws, committee charters, and past Meeting Minutes. This allows them to quickly reference governing rules and ensure all board procedures are compliant.

Frequently Asked Questions (FAQ) about the Chairman of the Board

1. How is the Chairman of the Board chosen?

The Chairman is a director who is formally elected to the leadership position by a majority vote of the full Board of Directors.

2. Is the Chairman an employee of the company?

It depends on the model. An "Independent" or "Non-Executive" Chairman is not an employee. An "Executive Chairman" is an employee of the company, a role often held by a company founder or a former CEO who has transitioned to focus solely on board leadership.

3. Who does the Chairman of the Board report to?

The Chairman is accountable to the full Board of Directors. Ultimately, the entire board, including the Chairman, is accountable to the corporation's shareholders.