Agony Uncle: Can one CEO wear two hats?

Borthwick Chris Jul2019lg

Dear Agony Uncle,

My organisation is looking at sharing back-end resources with another organisation: marketing, communications, finance etc. We have also been entertaining the idea of sharing a CEO while maintaining two different brands and two different boards. We are wondering whether you might have some knowledge about whether this has been done before, and if so, where.

No, I don't know whether it's been done before. I would say, however, that it hasn't been done often.

And there is a reason for that. Sharing back-end resources is probably a good idea, provided that the agreement is fully documented and some form of arbitration is set down. Sharing a CEO is more problematic.

If you believe that there is no possibility of the interests of the two organisations diverging at any point now or in the future, by all means have a common CEO - but in that case I can't see why you don't merge. You could operate under two business names.

If there is a possibility that you will take separate ways on any issue - and I do think it would be foolish to rule out such a possibility - then the ability of either board to issue binding instructions to the CEO comes into question.

On a procedural level, the issue would be how exactly the boards would decide on selection of the CEO; how they would decide to remove a CEO when thought necessary; and how the CEO's performance would be reviewed each year, against which KPIs.

On a purely practical level, I'd expect actual disagreements to come from a belief, justified or unjustified, that one group or the other was getting more than its proper share of the resources or of the CEO's time or commitment.

It would increase clarity if two half-time appointments were made to (perhaps) the same person, week on, week off, with the later possibility, if disagreements occurred, of splitting the role between CEO 1 and CEO 2.

It would also be possible to contemplate each group nominating board members to a third group, which would be responsible for conducting the joint operations: the CEO would then be responsible only to this body. This would ensure that disagreements had a formal process for resolution.

Has your organisation got a problem? A deal-making dilemma or a constitutional conundrum? Found yourself in a personality pickle or a media muddle? Our Community's resident Agony Uncle, Chris Borthwick, is here to help. Email your question to [email protected].