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CEO vs Owner – Is a CEO Higher than an Owner?

Among the top most positions at any corporate organisation are two that often cause confusion about their individual roles and responsibilities. These are the CEO and the owner.

The difference is often (not always) due to the size of the company. While most large companies will have a CEO who is the highest-level executive in charge, smaller companies are usually run by an owner. The CEO is in charge of the overall management of the company, while the owner has sole proprietorship of the company. It is possible that the CEO of a company is also the owner, but the owner of a company doesn’t necessarily have to also be the CEO.

The two have many differences as well as many similarities. First let us understand the two roles.

The CEO

A CEO is the highest position at any organization and is in charge of the overall running of the entire company. They are responsible for making big decisions for the company and are also the company’s representative in the media and the public eye.

The owner

The owner on the other hand does not have a specific role. Their role changes depending on the company and the needs of their company. An ‘owner’ is someone who owns 100% percent of the company. While, a ‘co-owner’ owns part of a company along with a partner or multiple partners. The owner has the right to do as they wish with their company and is often also the founder of the company.

Similarities

While both roles are different, they share similarities in the kind of skills needed to run an organization. While in some instances, a CEO might have more experience than an owner, they both need to have exceptional communication skills, leadership skills, and strategic thinking skills, although in different capacities.

Responsibilities

The CEO is in charge of planning and implementing long-term goals for the company. They are in charge of making critical decisions for the company and overseeing the duties of the other C-level executives. They work on developing and putting into motion the vision and long-term goals of the company. They are also involved in developing company policy and implementing the company’s strategic goals.

Since the owner has no particular role, their responsibilities are not defined either. But, since it is their company they oversee and work on multiple aspects of the business. This can include anything from production to HR or business development to marketing. As the company grows they might combine their role with that of a CEO, COO, MD, vice president, etc.

Hierarchy

The CEO is usually hired for the position, whether internally or externally. They are at the highest position in a company and only report to the board of directors and the chairperson of the board of directors. In the case that there is no board, then the owner is reporting authority for the CEO. They preside over C-level members of the company such as the COO, CTO, CFO, etc.

The owner is intrinsic or inherent in their role unlike the CEO. But if the company is sold in its entirety, then the owner will change. The owner’s role is separate from the corporate hierarchy and is under no obligation to report to anyone. If they also hold the role of a C-suite position then they function accordingly but also function autonomously for the most part.

Functional role

The CEO’s role is limited to the strategic management of the company. They usually delegate different aspects of management to different heads of departments or C-level executives like the COO for operations, the CFO for finances, the CTO for technology, the CMO for marketing, etc.

With no particular functional role, this is something that is reliant on individual companies and owners. The owner of a company might delegate as the company grows, but they still might control some of the different functions of the business. For example, they might not entirely give up their control of the company’s finances. But a CEO has no control over their company’s finances or marketing. Rather, they work with the CFO or CMO to ensure those aspects of the company are flourishing.

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