by Barbara Blackford
This week, The Conference Board issued its The 2011 U.S. Director Compensation and Board Practices Report.
The report is based on a survey of 334 public companies
jointly conducted by The Conference Board, NASDAQ OMX, and NYSE Euronext
between April and June 2011. The Harvard Law School Forum on Corporate
Governance and Financial Regulation, Stanford University's Rock Center for
Corporate Governance, the National Investor Relations Institute (NIRI) and the
Shareholder Forum each endorsed the survey by distributing it to their members
and readers. Participants in the survey (corporate secretaries, general
counsel, and investor relations officers) were asked to provide information on
a wide range of corporate practices, including: board composition and
leadership, director election practices, anti-takeover practices, compensation
practices, risk oversight practices, CEO succession planning practices,
board-shareholder engagement practices, and policies on director performance
assessment and retirement. Findings constitute the basis for a benchmarking
tool with more than 120 data points searchable by company size (measurable by
revenue and asset value) and 20 industrial sectors.
Major findings include:
Director compensation correlates more with
company size than with industry. Median total compensation
of board members ranges from $46,843 in the smallest companies to $190,000 in
the largest. "This finding underscores a likely correlation between the rising
director compensation levels observed in the last few years and the expanding
array of governance and compliance responsibilities expected of boards," said
Matteo Tonello, Executive Director, Corporate Leadership.
Computer services is the sector that most
emphasizes equity-based compensation. When it comes to
compensation mix, computer services is the industry with the lowest percentage
of total director compensation awarded in cash retainer (26.6%); and the sector
that placed the greatest emphasis on equity-based compensation (stock awards
and stock options), which surpasses 70% of the total.
Read the rest of this article on the Governance Center Blog
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