Board Leaders’ Pay Stays Frozen Even as Workloads Rise
Additional comp for leadership roles flat for several years.
Managing Director Ryan Hourihan was quoted in the Agenda article, “Board Leaders’ Pay Stays Frozen Even as Workloads Rise."
Board leaders, including chairs, lead directors and committee chairs, have more responsibilities compared to other non-executive directors, and they often receive additional cash retainers for their service.
However, as standard director pay has risen, the extra money for board leaders has stayed the same, new data shows.
Sources said boards are wary of increasing pay too much due to optics concerns and have largely chosen instead to moderately increase pay for all directors, not just leadership roles. Nonetheless, sources said boards should make sure pay accurately reflects workloads.
"The job [of a board leader] has gotten bigger while the paycheck hasn't changed," said Ryan Hourihan, managing director at Pearl Meyer.
"Boards generally rely on annual cash and equity retainers rather than attempting to compensate directors based on meeting counts or incremental time commitments. That philosophy tends to carry over to leadership positions as well."