Blogs

Compensation Advisory Partners reported that, based on 2018 proxy disclosures, 54% of the largest 100 companies have director equity award limits - with companies expressing limits both in terms of numbers of shares and dollar values. Dollar values associated with the limits run the gamut ($250K - $4.75M), but are higher for those that base limits on numbers of shares. The most common limit multiple is 3.01x - 5x annual equity (33%), followed by ≤3x annual equity (30%). The most common limit range in dollar value is $500,001 - $1M (48%). Some companies apply limits to total pay, and others carve out from their limits particular pay components, e.g., initial equity awards, committee chair pay, board leadership pay.

Also share-worthy:

• Virtually all companies compensate directors for board leadership roles. Median additional compensation for non-executive chairs is $233K (or 1.8x standard director compensation), and for lead directors is $35K.
• More than 90% of companies compensate for committee chair roles, with median additional compensation as follows: Audit Committee Chair: $25K; Compensation Committee Chair: $20K; and Nom/Gov Committee Chair: $15K.
• Committee member fees are less common - paid by 44% of companies for Audit Committee membership; 31% for service on the Compensation Committee; and 28% for Nom/Gov Committee service - with median committee member compensation at $16K.