Becoming the chairman of a company is one of the most prestigious and challenging roles in the corporate world. It requires not just ambition but a strategic vision, exceptional leadership abilities, and the ability to navigate boardroom politics.
As the chairperson, you’re responsible for overseeing the board of directors, guiding the company’s long-term strategy, and ensuring governance aligns with the organization’s mission.
In this guide, we’ll explore actionable steps and essential leadership skills that every great chairman should embody.
What is the chairman’s role?
The chairman of the board holds the highest position within the board of directors. While the chief executive officer (CEO) is responsible for the company’s day-to-day operations, the chairman’s role is more strategic and governance focused.
Key responsibilities of a chairman include:
- Board leadership: The chairman is responsible for leading board meetings and ensuring they are effective, transparent, and aligned with the company’s goals.
- Corporate governance: They ensure the company adheres to all governance policies and that the board of directors acts in its best interests.
- Decision-making: While the CEO handles operational decisions, the chairman ensures that the broader strategic direction of the company is sound.
- Facilitating relationships: The chairman must maintain strong relationships with non-executive directors (NEDs), executive leadership, and key stakeholders.
Role of The Chair Program
What’s the difference between the chairman and the CEO?
The chairman and the CEO hold distinct roles within a company.
The chairman leads the board of directors, overseeing the company’s overall direction and ensuring the board functions properly.
The CEO, on the other hand, is responsible for the day-to-day operations of the business, executing the board’s strategy, and managing the executive team.
While the chairman often serves in an advisory capacity, the CEO is actively involved in running the company. Both positions work together, but their responsibilities and authority differ significantly, with the chairman focused on governance and the CEO on management.
The 5 essential leadership skills of any good chairman
The role of a chairman demands more than just authority – it requires a rare combination of leadership skills: strategic vision, ethical governance, and the ability to harmonize diverse perspectives within the boardroom.
Chairpersons operate in a uniquely challenging environment, where leadership is as much about fostering trust as it is about making critical decisions.
To excel in this role, a chairman must master these key skills:
- Effective communication: Clear and compelling communication is essential for articulating vision and fostering meaningful dialogue among board members. An effective chairman facilitates open discussions while ensuring alignment with the company’s long-term goals.
- Conflict resolution and diplomacy: Disagreements are inevitable in high-stakes boardroom environments. A chairman must mediate disputes with impartiality, particularly when resolving conflicts of interest, and maintain focus on the organization’s best interests.
- Informed decision-making: Chairpersons are responsible for guiding the company’s strategic direction. This requires a deep understanding of the broader market, financial reports, and organizational goals to make informed, high-impact decisions.
- Corporate governance: At the heart of chairmanship lies a commitment to ethical and effective governance. Chairpersons ensure the board upholds fiduciary responsibilities, adheres to legal frameworks, and champions the company’s mission and values.
- Inspirational leadership: A chairman must inspire confidence and cohesion within the board and the leadership team. This involves cultivating trust, promoting collaboration, and mentoring future leaders to ensure the company’s long-term success.
Here’s an example: Former General Electric chairman Jack Welch was known for his decisive leadership. Under his chairmanship, GE became one of the most successful corporations in the world.
Welch’s ability to navigate boardroom challenges, inspire confidence, and make tough decisions helped him maintain a competitive edge throughout his tenure.
How to tailor your path to chairdom with 6 tips
It’s very difficult to prepare for the role of a chairman. It’s not one that you can simply train or interview for – it’s a role bestowed only upon the most celebrated board members. That said, it doesn’t mean that you can’t build your expertise, profile and skills to set you up for success.
Are you aspiring to become a chairman? Then here are some key tips on how to tailor you path:
1. Cultivate relationships with key stakeholders
A successful chairman knows how to maintain strong partnerships with stakeholders, both within the company and externally. This includes managing relationships with the board of directors, investors, and senior executives.
Always be proactive in your communication. Building trust early ensures smoother decision-making processes later.
2. Gain boardroom experience
It’s essential to have hands-on experience in the boardroom. Look for opportunities to serve on company boards or nonprofit organizations to familiarize yourself with governance structures.
Take on leadership positions within the board whenever possible, such as chairing subcommittees or overseeing key initiatives.
3. Contribute to succession planning
As a potential chairman, you’ll need to be involved in creating a strong succession planning strategy to ensure the company’s long-term leadership stability.
Mentoring future leaders within the organization shows you’re committed to the company’s future, a key trait that board members look for in a chairman.
4. Build your personal leadership brand
To secure a chairman role, having a strong personal brand is essential. Your personal brand should showcase your leadership skills, corporate governance knowledge, and ability to lead a board.
Increase your visibility by speaking at conferences, webinars, or board-level forums on topics such as corporate governance, strategic decision-making, and leadership development.
Public speaking engagements position you as an expert and help build credibility within your network.
Make your track record known by highlighting successful initiatives you’ve led, especially those related to corporate governance, financial oversight, or board leadership.
Case studies or examples of your successes help demonstrate your ability to lead at the highest levels.
5. Leverage LinkedIn for networking and visibility
Building a strong professional network on LinkedIn can open doors for chairman positions in both the corporate and nonprofit worlds.
Actively engage in discussions relevant to corporate governance and share insights on leadership. Highlight your achievements and leadership skills to position yourself as a thought leader.
6. Tailor your approach for different companies
Chairmanship in a startup looks different from that of a large public company. In startups, you’ll need to take a more hands-on approach to guide growth and innovation.
Adapt your leadership style based on the company’s needs. A startup may require more active involvement in strategy, while a public company may need a chairman focused on governance and long-term vision.
For instance, Meg Whitman (the former chairman of Hewlett-Packard) successfully led the company through a challenging period of transformation. Her experience across both startups and established corporations gave her the versatility to adapt her leadership approach based on the company’s evolving needs.
Certify your governance skills with IMD
To further develop your leadership abilities, consider enrolling in IMD’s High-Performance Boards program. This program is designed to equip you with the tools needed to excel as a board member and chairman, focusing on corporate governance, decision-making, and leadership strategies that drive board effectiveness.
Looking to develop your leadership skills as a chairperson? Explore IMD’s Role of the Chair program to gain valuable insights and enhance your expertise.
Leadership is a continuous learning process. Whether you’re already in a senior executive role or just beginning your journey toward the chairman position, it’s essential to keep growing your leadership skills and expanding your network.
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