That's how George Bradt saw it in a Forbes post in 2013: The Right Way To Divide Responsibilities Between Chairman and CEO.
While separating the CEO and Chair roles may be an accepted governance practice globally according to the 15th Strategy& Annual Study of CEOs, Governance, and Success, this is not the case in the U.S. or Canada.
What is it about "running a board" that makes so many North American CEO Chairs reluctant to give up running the board while at the same time running the company?
We think it's because "running the board" actually means "running meetings" of the board to deliver corporate governance. Running board meetings ensures control of the meeting process and control of the meeting discussions. Running the board means control of governance.
Control of meeting processes
The Chair has significant power over board meeting processes.
The Chair can exercise a great deal of influence over the agenda. Board meetings are organized by agendas. Agendas determine what gets discussed and put forward for approval. Agendas can control the amount of time to be spent on each issue.
The Chair has the authority to chair or lead the meeting by virtue of being Chair. This means the Chair controls who speaks at the meeting and when. The Chair has the power to call the meeting to order and even the power to end it. The Chair may have the power to cast a deciding vote. The Chair always gets to speak first and last.
To be clear, setting agendas and having the authority to lead discussions only give a Chair momentary power and control.
As Bradt notes: "What really matters is clear leadership that inspires and enables others. Titles don’t matter. Formal divisions of responsibility don’t matter. Behaviors, relationships, attitudes, values and the environment matter."
Nevertheless, the Chair's power over meeting process can impact the content and quality of the board meeting.
Control of meeting discussions
Consider now what boards are supposed to discuss. Board meetings are about the well-being of the corporation itself.
That well-being turns on what the CEO and CEO’s management team have been doing and plan to do.
In other words, a board meeting can be seen by a CEO as a forum to second-guess the CEO.
CEO’s are not known for their appreciation of review or advice, let alone being second-guessed.
Combining the roles of CEO and Chair reminds everyone in the meeting that the CEO is the most powerful person in the room. As judge, jury, and executioner, the CEO Chair can use rhetorical questions rather than probing ones to discourage or contain any full discussion of an issue.
An example "I can't see why anyone should have any concerns about this. Are there any questions?" The intent of the statement is clear. No questioning is expected. No concerns are warranted.
The focus of the meeting shifts from the looking after the well-being of the corporation to that of the CEO Chair.
Running the board should mean delivering governance
Running the board should mean good governance. The board's purpose is to be an independent forum for sober second thought so that the best interests of the corporation are served.
Separating the Chair and CEO roles introduces the possibility for more meaningful discussion of issues, assuming that the board has the requisite competencies and desire to do so.
In fairness, separating the roles is not essential for all companies. Consider most family-owned and privately-held companies. The shareholders don't need a voice. They are already at the table. It is when shareholders don't have effective representation that separation of the roles provides , at the very least, an appearance that best practices in governance are being followed.
One veteran of the boardroom put it this way: "Splitting the roles is one of the easiest boxes to tick in moving to better governance."
Perhaps Mr. Bradt's description of the roles could be restated as: "Chairs run meetings. CEOs run companies." It's the board meeting that is key to governance.