Why Is the Combined Chair/CEO (Or Managing Director) Position Being

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The Answer is It has been observed in many studies on management that boards of directors tend to be more effective when an individual does not simultaneously occupy the positions of Chief Executive Officer (CEO) and chairperson. Such a situation, wherein a CEO is also the chairperson of the governing board, is referred to as CEO duality. A chairperson of a governing board may not necessarily be the leader of the board; in certain instances, the chairperson simply conducts the meetings of the board and sets the tone of the board. Their strength as a leader may well determine the effectiveness of the board. The separation of the position of chairperson of a governing board from the CEO position can significantly help directors prevent crises, act swiftly and effectively in the event of a crisis, and objectively evaluate the impact of crises. CEO duality usually has an adverse effect on organizational performance. For example, it has been observed that the bankruptcy rate tends to be positively correlated with CEO duality.

Why Is the Combined Chair/CEO (Or Managing Director) Position Being

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Why Is the Combined Chair/CEO (Or Managing Director) Position Being

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Correct Answer:
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