Categories: Agenda

‘New Normal’ in Pay Extends to Directors

The relatively nominal raises seen in CEO pay at the largest companies are also being reflected in boards’ increases to their own pay plans. Compensation consulting firm Willis Towers Watson reports that among 300 Fortune 500 companies, total direct compensation for directors grew 2% at the median, to roughly $260,200, from 2016 to 2017.

Among the 300 companies reviewed in the study, just over one third, or 34%, increased cash, equity or both components of director pay. Median cash retainers rose 6%, from $90,000 to $95,000, while equity grants increased 2%, from $147,650 to $150,000.

However, while modest increases to cash and equity components seem to be following a normalized formula year over year, boards are still granting larger, targeted increases to committee chairs’ and lead directors’ retainers. This happens in cases where board members hold time-intensive leadership and committee chair roles concurrently.

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