Firing the CEO

Unfortunately, it is not uncommon for the board to become dissatisfied with the performance of their CEO or senior staff person. If you are considering firing your CEO, please consider the points below. Before firing, be sure that the CEO, and not mis-communication, is the problem. And then proceed in a manner that respects the dignity of the CEO and protects you from large legal costs.

Redirecting your CEO

Be sure you have a written job description which really states what you expect your CEO to do.

Have regular performance feedback meetings with your CEO to review your expectations and your satisfaction or dissatisfaction regarding each performance area.

Record the key points of your performance review discussions with both the CEO and a board member signing the document. Provide the CEO with a copy and place a copy in the CEO’s personnel file.

Discuss action plans for improving the CEO’s performance so the board’s expectations can be met. Put time lines on each plan. Make it clear that the board expects to see notable performance improvement. On a monthly basis, monitor progress towards achieving the action plans. If the board and CEO cannot reach a mutually acceptable development plan, proceed to the next steps.

Planning for a New CEO

If after completing the steps above you do not expect that the CEO’s performance will meet your expectations in the near future, consult an employment law specialist. Determine what your legal rights and responsibilities are regarding cause for dismissal, notice, severance pay, etc.

Determine what severance package you will offer the CEO and what day will be his last.

Meet with the CEO to explain your dissatisfaction and the consequences —this is his last day. Arrange for him to gather his personal belongings and turn in corporate items such as keys and credit cards.

Determine who will manage the organization after the CEO leaves. Develop an interim CEO plan — who might be the acting CEO, and on what terms.

Determine your strategy for finding your new CEO.
Unfortunately, it is not uncommon for the board to become dissatisfied with the performance of their CEO or senior staff person. If you are considering firing your CEO, please consider the points below.

Before firing, be sure that the CEO, and not miscommunication, is the problem. And then proceed in a manner that respects the dignity of the CEO and protects you from large legal costs.