If you tell them your facebook is for friends, they wonder why they don't qualify. + there are "friends" and friends. One you have no problems showing pictures of you getting wasted, for other it will make you lose face.
My policy on friends is, basically, that unless you're someone who gets all the stupid in-jokes from my college days, you don't get to be my friend on Facebook. Haven't had any trouble from that, either, despite getting an avalanche of friend requests almost as soon as I signed up.
Issues of privacy, and the right to be wrong is atmost important and I think with facebook/mysapce/twitter it makes your life totally accountable to atleast 300+ friends, if not more.
On the basic topic - Ok for a ceo to be on facebook ? >> Well if your ok to the scrutiny of your peers, pals and foes alike then what the hell ? Upload and let the world know. But remember you lost your right to be wrong.