Effective Boards: Relationship Between the Board and the CEO

Bob Finocchio and Lon Allan, both directors of several corporate boards, talk about the relationship between the CEO and the Board. Finocchio emphasizes that the CEO works for the Board, not the other way around. While both are working for the same objective--maximizing shareholder return--there is necessarily some tension between them and the board must be willing to challenge the CEO, particularly the "rock star CEO." The CEO also has reasonable expectations of directors: They should be prepared, available, and have some passion for the company.