First Report in the Series Explores Board Retainer Pay Practices and Prevalence of Board Meeting Fees
REDWOOD CITY, CA (September 25, 2013) – Equilar, the leader in executive compensation benchmarking and governance research, today released the first of a three-part series on S&P 1500 company practices related to board retainers, committee fees, and board composition. For this first report in the series, Equilar partnered with the Society of Corporate Secretaries and Governance Professionals and Meridian Compensation Partners to take a fresh look at how companies utilize board retainers and board meeting fees to secure top boardroom talent.
“Boards of directors have a unique position in the corporate world, as they have the unusual responsibility of setting their own compensation. Attention to this aspect of board governance has intensified since the 2008 financial crisis that crippled economies across the globe,” said Aaron Boyd, Equilar’s Director of Governance Research. “Today there is heightened interest in the process by which boards set their pay levels and how pay practices align director behavior with the best interests of shareholders.”
In its S&P 1500 Board Profile: Board Fees Report, Equilar found that S&P 1500 companies offer director retainers with a median value of $220,000, nearly double that of small-cap issuers. The study also reports that the percentage of companies paying board meeting fees has fallen, from 58.8% in 2008 to 38.7% today. With respect to board leadership positions, more boards are paying a premium for the advice and experience of lead directors, 44.9% today compared to 29.9% five years ago.
"The Society is pleased to have provided commentary for this report," said Ken Bertsch, President and CEO of the Society of Corporate Secretaries and Governance Professionals. "For good reason, director compensation has increased in recent years, and the evolution of best practice on this is important for corporate governance, if overshadowed by executive pay debates."
“As highlighted in this comprehensive report, director retainer fees have risen over the past few years, evolving with the scope and exposure of the director’s role along with other structural pay changes that boards have implemented,” shared Jon Szabo, Senior Consultant at Meridian Compensation Partners. “Equilar has conducted a thorough analysis of cash and equity retainer elements to give companies of all sizes and industries insight into what is happening in their space. Meridian is pleased to have been able to partner with Equilar and contribute to this valuable piece of research.”
The report delves into a wide range of topics including retainer pay components, cross-industry analysis, and a breakdown of board meeting fees. For more details and a complete review of the findings, please request a copy of Equilar’s S&P 1500 Board Profile: Board Fees Report. View Equilar’s webinar with experts from Meridian and the Society for discussion of the critical topics within the Board Fees Report. The next report in the series will focus on board committee fees in the S&P 1500 and will be published in October.
Headquartered in Redwood City, Calif., Equilar is the leading provider of executive compensation data and governance tools for corporations, nonprofits, consulting firms, institutional investors, and the media. As the trusted data and executive solutions provider to 70% of the Fortune 500, Equilar helps companies accurately benchmark and track executive and board compensation, pay for performance results, and compensation practices. In addition, Equilar offers a leading business and event networking solution focused on serving executives and board members. Equilar’s research is cited regularly by Bloomberg, The New York Times, The Wall Street Journal, and other leading media outlets.