2014 REM survey

26 August 2014

Media release

Directors’ fees - growth again after quiet years

The Institute of Directors 2014 Directors’ Fees Report shows directors’ fees have risen this year after several years of little change.

Institute of Directors Chief Executive Dr William Whittaker said the increase in director fees could be attributed to several things.
“It’s partly a correction after a few years where fees have been flat or increased slightly. But it’s also a reflection of the improved economy where companies are in a better position to increase payments. There’s also an element of greater awareness of the importance of the role of directors and chairmen and recognition that the roles carry an increasing level of personal risk.”

The 2014 survey, carried out in conjunction with dsd Consulting, included 1,262 organisations and 1,883 directorships making it the IoD’s largest ever fees survey. It highlighted a number of interesting trends.
The median fee for a non-executive director increased from $36,000 to $40,000, while the median fee for a non-executive chairman increased from $50,000 to $51,000.

Dr Whittaker said a pleasing aspect of the survey was the increased representation of women both in numbers and in remuneration. In 2014, 23.9% of the survey sample were women up from 19.9% in 2013, while the gap between male and female directors fees was also closing.

The median for male non-executive directors increased by $2,800 in 2014, while for females the rise was $10,500. Female non-executive chairman had also recorded a larger median increase than males.

“The survey shows pay disparity between male and females directors and chairmen is closing, which I believe is mainly due to the increased numbers of women being appointed as directors and chairmen in more private company boards”, Dr Whittaker said.

The disparity between New Zealand and overseas owned companies also increased. The median fee for a non-executive director for New Zealand owned firms rose from $27,000 in 2013 to $36,000 in 2014, while the median for overseas owned firms more than doubled, rising from $40,000 in 2013 to $85,000 in 2014.

Directors at all levels continued to volunteer their time and expertise for free, with 50.9% of directors surveyed having one or more unpaid directorships, up from 44.7% in 2013.

Attached is information about the 2014 director’s fees report, including a snapshot of some of the key findings. The survey covered 1,262 organisations and 1,883 directorships making it our largest fees survey:

FINAL_2014_Survey_Infographic.pdf

ENDS

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