Prof Trevor Purt was suspended from Betsi Cadwaladr University Health Board (BCUHB) after it was put into special measures.
BCUHB ran the much-criticised Tawel Fan ward at Glan Clwyd Hospital, Denbighshire, which closed in 2013.
A health and care union boss said the move would "do nothing" to address "deep-seated" problems at the board.
Jon Restell, chief executive of the Managers in Partnership (MiP) union, said: "This will only create more instability, which is not in the patients' interests."
A report found there was "institutional abuse" at the Tawel Fan mental health unit, where patients were allegedly treated like animals in a zoo.
Deputy chief executive of the Welsh NHS Simon Dean was appointed as interim head of the board on Tuesday.

Gerald Jacob's family said he had retired last December and had been planning to "continue his life travelling" with partner.
The incident at Loggerheads is believed to have happened on Saturday at 19:30 GMT. Police were alerted to the crash scene on Sunday just before midday.
"Gerry, as we all knew him, loved life and lived it to the full," they said.
North Wales Police are appealing for witnesses to the incident on Ruthin Road involving a grey BMW car which was found in a hedge.

Blackwell, 25, was taken to hospital after Saturday's British middleweight title fight with Chris Eubank Jr was stopped in round 10.
He suffered a small bleed on the brain but has not required surgery.
"I'm told the vital signs are good and doctors are cautiously optimistic," Costello told BBC Radio 5 live.
Blackwell is heavily sedated, but doctors are gradually reducing the amount of drugs over the next two to three days.
"There are no major issues within the context of his condition," added Costello.
Towards the end of the fight, Eubank's father - former world champion Chris Eubank Sr - told his son to punch Blackwell's body rather than his face.
The ringside doctor then halted the fight in round 10 because Blackwell's left eye was swollen shut.
He was taken from the ring on a stretcher while being given oxygen.
Eubank Sr later told BBC Sport he would have stopped the fight had his son been in the same situation, while Eubank Jr said he eased off in the final round and that referee Victor Loughlin should have ended the bout sooner.
However, Eubank Jr's trainer Ronnie Davies disagreed and said both Loughlin and Blackwell's corner were right not to pull him out of a "title fight".
The British Boxing Board of Control said it is satisfied with the way the fight was handled and respected trainer Adam Booth told BBC Radio 5 live that Loughlin had "acted immaculately".
Meanwhile, boxing promoter and former world champion Barry McGuigan said it was an "isolated incident" and "nobody was to blame".
The suspension of the chief executive of a troubled health board is "short-sighted", a union boss has said.
[NEXT_CONCEPT]
A family has paid tribute to a "very special" 66-year-old man who died in a crash near Mold, Flintshire.
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Nick Blackwell's family expect the boxer to wake from his induced coma in the next 48 to 72 hours, reports BBC boxing correspondent Mike Costello.