[nsedlet]

When the friend is not also a business partner, this practice seems bad for the company - the CEO is hobbling the company's ability to hire to preserve a personal friendship. The CEO is not the only stakeholder - at the very least he/she should carefully weigh the effect on the friendship against the cost to the company of not making the hire.

On the other hand, Ben does point out that in practice you really shouldn't do this with very many companies, if any. And I'm not sure you could say that it's CEOs' (or any employees') duty to prevent personal considerations from affecting their work.