\ ˌsē-(ˌ)ē-ˈō How to pronounce CEO (audio) \

Definition of CEO

: the executive with the chief decision-making authority in an organization or business

First Known Use of CEO

1972, in the meaning defined above

History and Etymology for CEO

chief executive officer

Keep scrolling for more

Learn More about CEO

Dictionary Entries near CEO



century plant





Statistics for CEO

Last Updated

23 May 2019

Look-up Popularity

Time Traveler for CEO

The first known use of CEO was in 1972

See more words from the same year

Keep scrolling for more

More Definitions for CEO



Financial Definition of CEO

What It Is

The chief executive officer (CEO) oversees the entire operation of a company or organization. A CEO is responsible for coordinating effective operating, marketing, financial, cultural and legal strategies that maximize shareholder value.

How It Works

In some organizations, the CEO is called the president, the executive director or even the chief administrative officer, though many organizations have a CEO and people with these titles, too. In small companies, especially start-ups, the CEO does everything. As organizations get bigger, CEOs delegate duties to subordinates.

In most cases, the company's board of directors hires and evaluates the CEO. The board of directors is elected by the shareholders and has a duty to protect and preserve the interests of the shareholders. The CEO informs the board of the company's activities and plans on a regular basis. The CEO often has a seat on the board of directors, but the board can also fire the CEO -- that is, the CEO "serves at the pleasure of the board."

Good CEOs have skills in a variety of areas, but the CEO's job is not to be an expert in every area of a business. The CEO must focus on the broader picture and lead an entire organization towards a strategic goal. There are a variety of ways to measure CEO performance, but most boards look at changes in share price and company strategy.

CEOs have four general responsibilities:

1. Optimize Financial Performance. The CEO determines the company's financial direction, goals and results. The CEO works especially closely with the chief financial officer (CFO) to make strategic capital allocation decisions and set up financial measurement systems. The CEO also leads a capital-raising team that finds money for expansion or other necessary activities.
2. Optimize Overall Strategy. The CEO sets and maintains a mission and vision for the company. This ultimately dictates the products, markets and strategies the company adopts. The CEO also has a variety of direct reports (the senior management team) that he or she must hire, develop, listen to and even fire if necessary.
3. Develop Corporate Culture. The CEO sets the cultural tone of the company. Explicit and subtle messages expressed by the CEO have a large effect on whether a company is a good or bad place to work, which in turn drives the company's ability to attract and retain good employees.
4. Be the Face of the Company. As such, the CEO is a key figure in the company's marketing, PR and community efforts.

Why It Matters

The CEO is largely responsible for the success or failure of an organization. Because of the inherent pressure involved with the position, it takes a very strong person to do the job well. In many cases, however, the bulk of a CEO's daily interaction occurs with only a handful of people. This sometimes makes it difficult for the CEO to obtain a completely objective evaluation of a company, especially when direct reports are usually reluctant to give honest and open feedback.

Overall, it is the managerial skills and experience of a CEO that can make or break a company. An effective CEO can bring a floundering company back from near bankruptcy, or vice versa, can fail to lead a promising company into prosperity.

Source: Investing Answers



English Language Learners Definition of CEO

: the person who has the most authority in an organization or business


\ ˌsē-ē-ˈō How to pronounce CEO (audio) \

Legal Definition of CEO

: the executive with the chief decision-making authority in an organization or business

History and Etymology for CEO

chief executive officer

Keep scrolling for more

More from Merriam-Webster on CEO

Rhyming Dictionary: Words that rhyme with CEO

Spanish Central: Translation of CEO

Nglish: Translation of CEO for Spanish Speakers

Britannica English: Translation of CEO for Arabic Speakers

Comments on CEO

What made you want to look up CEO? Please tell us where you read or heard it (including the quote, if possible).


an act or instance of editing or removing

Get Word of the Day daily email!

Test Your Vocabulary

What's that Smell?! Quiz

  • wide eyed dog smelling rose
  • Someone who is hircine smells like a:
True or False

Test your knowledge - and maybe learn something along the way.


Test Your Knowledge - and learn some interesting things along the way.

Love words? Need even more definitions?

Subscribe to America's largest dictionary and get thousands more definitions and advanced search—ad free!