The Advisors' Blog

Here are six interesting nuggets from Spencer Stuart’s recent examination of director compensation trends in the S&P 500:

1. The average total compensation for S&P 500 directors is $316,091, an increase of around 3% from $305,808 in 2021.

2. Stock grants represent the largest share of director compensation, at 56% — the same proportion as last year. And these are again followed by cash at 37% of compensation, the same as last year.

3. The composition of equity awards has shifted significantly over the past two decades, with fewer companies granting options and more providing stock awards. This year, 11% of boards disclosed that they award stock options to directors — down from 25% in 2012, and from 77% in 2002.

4. The shift by S&P 500 boards away from paying meeting fees continues. Only 24 boards, or 5%, pay board meeting fees — down from 30 companies (6%) in 2021. A decade ago, 33% paid meeting fees; in 2002, 70% did.

5. Of the 176 S&P 500 boards with independent board chairs, 91% provide the chair with additional compensation (worth an average of $164,205, only $71 less than last year). The value of additional compensation for board chairs ranges from $25,000 to $585,000.

6. Among boards that have a lead or presiding director, 82% pay them additional compensation, averaging $44,314. Lead directors are more likely than presiding directors to receive additional compensation — 86% versus 51% — although the gap has narrowed since last year (87% versus 38%).

– Liz Dunshee