The Advisors' Blog

– Broc Romanek, CompensationStandards.com

In The Corporate Library‘s latest report – “2008 Director Pay Survey” – it was found that:

– Median total board compensation for S&P 500 firms is more than $2 million
– Median total compensation for individual directors of S&P 500 companies is just under $200,000
– In contrast to their CEO colleagues, compensation for directors in the S&P 500 did not increase by more than that for directors of smaller companies
– Company size is the greatest influence on board and director compensation

In our “Director Compensation” Practice Area, we have posted the results of a few other recent director pay studies. Here are some thoughts from a member about these surveys:

Nothing earth-shattering, just a continuation of trends noted in prior years. Larger companies pay more cash, smaller companies grant more equity. Larger companies are more likely to make equity grants in stock, while smaller companies are more likely to grant options (makes sense, since the stock price of smaller companies often has more upside potential). Stock ownership guidelines are more prevalent the larger the company.

The smaller companies that I represent liked these kinds of surveys because they at least gave boards some numerical data points. Many of the board surveys are either not available without a fee, or else heavily weighted towards large companies.

A Poll: Use of Director Pay Surveys

Please take a moment to click on an answer; all responses are anonymous. If you’re an advisor and not in-house, please answer based on how a majority of your clients act: