Who Can Remove a CEO of a Corporation

Question:

The Chief Executive Officer (CEO) of a corporation can be removed:

– By the creditors.

– By the Chief Operating Officer (COO) or the Chief Financial Officer (CFO).

– By the board of directors.

– Directly by the shareholders.

– By the federal government only.

Answer Description:

The Chief Executive Officer (CEO) of a corporation can be removed by the board of directors.

Here’s a detailed explanation:

Board of Directors: The board of directors is responsible for overseeing the management of the company, including the CEO. They have the authority to hire and fire the CEO based on the performance and strategic direction of the company. The CEO is accountable to the board, and it is their duty to ensure that the CEO’s performance aligns with the company’s goals and policies.

Other Options Explained:

Creditors: Creditors do not have the authority to remove the CEO. Their role is to provide loans and ensure repayment terms are met, but they do not manage or govern the company’s internal operations.

COO or CFO: While the Chief Operating Officer (COO) or Chief Financial Officer (CFO) may have significant roles within the company, they do not have the authority to remove the CEO. The CEO is typically the highest-ranking officer and reports to the board of directors.

Shareholders: Shareholders have voting rights to elect the board of directors but do not directly remove the CEO. However, they can influence the board’s decisions indirectly through their voting power.

Federal Government: The federal government does not have the authority to remove a CEO unless there are legal or regulatory issues, but typically, corporate governance issues are handled internally by the board.

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