CEOs, Chairs and Lead Directors: Who Leads the Board?


Summary

The leadership structure of the board of directors (the “Board”) is not uniform among U.S. public companies. Historically, the “American model” was predominant, and the majority of U.S. companies appointed a single individual to fill the role of both chief executive officer (“CEO”) and chairman of the Board, as the “Chairman/CEO.” The counterpoint to the combined Chairman/CEO is the “British model,” which splits the roles and appoints a CEO to manage the company and a separate chairman to govern the company’s Board. The British model has gained increasing support among shareholder rights activists and proxy voting services and become more common among U.S. public companies, including some of the largest. However, both models are still prevalent, and selecting one or the other implicates a host of additional Board leadership questions, including whether the company should also designate a lead or presiding director to exercise a more limited corporate governance function, and whether a ...