It does have chain of command. It is one of the game's more distinguishing features.
How? You can go through the whole campaign and never give a single order, your ships will still do fine. The AI intentionally works like this so you don't have to micro your fleet all the time in every single fight. Calling the player, and then every other AI ship that works individually a ''chain'' is a stretch, it's more like a single line of command.
You create ad hoc task-groups and give them overall commands
I still think of them more as suggestions. I'd say the closest thing to a real command is Direct retreat, but even then the AI pays attention to some things.
So yeah I'm not a huge fan of the whole strategy in combat suggestion but what I'd like to see is different kinds of officers. Let's say there are inexperienced ones who could only pilot frigates and destroyers, but you could have more of them. So it's actually not a waste putting an officer on a frigate. I know the new skill system is trying to deal with this but I really don't like ''here's a buff to some arbitrary stats if you have weaker ships'' thing. It's such a cheap way to balance the diversity of fleets.