What Is an Interim CEO?
An interim CEO is a person appointed by a company's board of directors to assume the role of the chief executive officer during a time of transition or as the result of the sudden departure of the company's previous CEO.
These CEOs are tagged with the "interim" tag because they have not officially been given the title of full-time CEO; however, they assume full responsibility for the CEO role while in the position.
Interim CEOs are often called upon to "steady the ship" in periods of great turmoil. Most often an interim CEO is hired by a company's board or shareholders. Compensation for interim CEOs will most likely be similar to a regular full-time CEO's salary and benefits.
- An interim chief executive officer is often named when a company loses its CEO unexpectedly.
- A CEO is the highest-ranking executive in a company and is often the public face of the company.
- The duties of an interim CEO (or a full-time CEO) include acting as a top liaison between corporate operations and its shareholders and board of directors, managing significant corporate actions, and even day-to-day operations at smaller companies.
- CEOs may sit on a company's board of directors, but interim CEOs might not, depending on the circumstances.
How an Interim CEO Works
Although traditionally companies will call from their existing employee base when hiring an interim CEO, businesses can bring in interim CEOs from outside the firm.
An interim CEO often has the same jobs as a CEO. They are responsible for the large-scale and day-to-day running of a business or company, especially in smaller businesses.
One of the reasons for this is that the skills desired for interim CEOs are generally unique, as they are often required to manage a crisis, as opposed to the day-to-day operations of the company. A CEO is responsible for hiring personnel and will pay special attention when it comes to hiring upper management positions. A CEO manages financial decisions for the company, as well.
An interim CEO may be appointed by a company's board of directors to assume the role of the chief executive officer when a company is facing a public relations disaster.
Sometimes an interim CEO stays on and other times they move on after a full-time CEO is identified and hired. A president of a company normally ranks below the CEO position, but sometimes, depending on the size and type of company, the CEO and the president roles will be in one position.
A recent example of an interim CEO taking control of a company was after Equifax's large data breach in September of 2017. Richard Smith, Equifax's CEO who stepped down in September 2017 due to criticism of his handling of a large cyber attack, was replaced by Paulino do Rego Barros Jr., who immediately took to apologizing for the data breach and introducing ways to help those affected. He held this position till January of 2020.
What Is the Difference Between an Acting and Interim CEO?
Generally, an acting CEO is one that is CEO for a defined period of time. An acting CEO can be appointed CEO for a variety of reasons with a set time and after the expiration date is no longer CEO. An interim CEO is one that takes on the CEO position for an undefined period of time; usually, until a new CEO is appointed.
What Title Is Higher Than CEO?
The chairman of the board is a title that is higher than the CEO. A chairman can hire, fire, and review a CEO. A CEO is the highest position in the operational structure of a company; however, a board can decide who the CEO is and, therefore, the chairman, who heads the board, has power over the CEO.
How Long Do Interim CEOs Last?
Interim CEOs can last for different amounts of time depending on the company; usually, however, they do not last long. Interim CEOs are appointed for the time it takes to find another CEO, and this can usually be done fairly quickly. Companies typically have a short list of people they would want to approach as CEO, so after negotiations, a new CEO can start fairly soon after an interim CEO takes on the position.