A question that will undoubtedly come to mind as you start your journey to becoming a Board Member, is the question of how much you can expect to be paid as a member of a board. The amount a Non-Executive could earn depends on a number of different factors.
The most obvious are:
- The type of role you are appointed to;
- The sector the organisation operates in;
- The type of organisation;
- The size of the organisation;
- The turnover of the organisation;
Recent remuneration findings
Boards remunerate their members in a number of different ways – including daily sitting fees, annual fees, expenses, equity and additional committee fees. As such, board remuneration studies can struggle to gather enough information to be accurate and they often use relatively small sample sizes – further compounding any inaccuracies. Still it is possible to gather a strong sense of what you could expect to be paid if appointed to a board that remunerates.
Not for Profit Remuneration Practices
Let’s start by considering not for profit board member remuneration – or lack thereof!
A recent international study suggested only between 2% – 18% percent of nonprofits compensate board members, and it is unusual outside of large, complex entities such as health care systems or large foundations. Other studies I have read suggest that 96% of Not for Profit’s have voluntary boards
Having said that most will offer to pay your expenses – though in reality few board members claim these expenses with the exception of very major financial outlays.
Commercial Chair & Non Executive Remuneration Practices
The chairman is responsible for the leadership of the board, ensuring effectiveness in all aspects of its role and setting its agenda. The chairman has ultimate responsibility for the board and so has a role distinct from that of the other non-executive directors. In some companies this may be close to a full-time role. Consequently there is typically a significant fee differential between the chairman and other non-executive directors.
The tables below outline the fees NEDs, Committee Members and Chair receive.
Conclusion
Developing a portfolio career can be lucrative. For many, becoming a paid board member is a major life goal. However, for many the opportunity to serve on a board for an organisation that they are passionate about is all the reward required. Regardless of your motivation, board work is incredibly rewarding but requires dedication and passion. Even if being a paid board member is your goal, it shouldn’t be your only goal when it comes to your portfolio career.
To achieve your board aspirations, whether it is to be a paid board member or to serve the organisation or the community with passion, you need access to board opportunities and you need to know how to ‘dare them not to appoint you‘.
What next?
Board Appointments is the UK’s leading Non Executive Director advertising & board career development firm – no one does what we do or can reference the success that we have had in putting people on boards. Specifically, we do two things.
- We advertise the UK’s largest & most diverse list of non-executive board vacancies – over 4000 each year
- We equip members to develop a board career through practical career services like: Board CV writing, Application Support & the Board Search Course.
People use our services because what we do has been proven to work. As a result, we can evidence having assisted hundreds of members further their board careers through the intimate knowledge we have gained through over a decade of putting people on boards. So, if you: are frustrated with your current board search; can’t find relevant opportunities; have stalled portfolio career; can’t get, or can’t get past, an interview Board Direction can help.
David Schwarz, CEO & Founder