The decision on whether the support for a CEO and the company board should be independent or dependent on the company hinges on the objectives behind seeking such help and the specific context of the organisation.

This blog post is part of the series “SME CEO and external support” which compiles thoughts from Aamu Partners’ Tuomas Paananen and CEO CF’s Tony Wood. Aamu Partners is a company assisting SME CEO’s to reach their goals and grow their shareholder value. CEO CF is a forum where selected leaders collaborate to build trust, share insights, learn from others’ experiences, and develop into respected leaders in society and their organisations.

Independent Help: Independent advisors, coaches, or board members are often preferred for their ability to provide unbiased perspectives. They can make objective assessments of the company’s strategy and performance without the influence of internal politics or pre-existing company culture. Independence is particularly crucial in situations where a fresh viewpoint or specialised expertise is needed, or in governance roles where impartial oversight is essential to ensure accountability and protect the interests of all stakeholders.

Dependent Help: On the other hand, individuals who are dependent on the company, such as internal executives or stakeholders with a vested interest in the company, can offer deep institutional knowledge and a stronger alignment with the company’s existing strategies and culture. Their advice and support are often grounded in a thorough understanding of the company’s history, mission, and operational nuances.

Balanced Approach: In practice, a balance is typically sought. For instance, a CEO might have an independent coach for personal leadership development while also benefiting from the institutional knowledge of a dependent advisor who understands the company’s ethos. Similarly, a board might include both independent directors, who provide impartial oversight, and dependent directors, who bring continuity and a deep understanding of the business.

Ultimately, the key is to ensure that the CEO and the board have access to a diverse range of insights and support mechanisms that collectively contribute to sound decision-making and the long-term success of the organisation. The correct mix of independent and dependent support should be tailored to the company’s specific needs, governance structure, and strategic objectives.

Read more from our blog post series: 

• Part 1: When Should SMEs Seek External Support?
• Part 2: What value external support provides to SME’s CEO?
• Part 3: Should the support for the CEO be independent or dependent on the company?
• Part 4: Six typical arguments against outside help, and why they are wrong
• Part 5: Why does a seasoned CEO also need a coach?