Studies have shown people who have board appointments: are unemployed less, have better relationships (that can be leveraged), can evidence strategic experience (that help with a promotion), have more successful retirements, and transition into new roles or consultancy careers more easily than those who don’t.
Moreover, according to Harvard Business Review, those who hold a board appointment in addition to an executive role earn 13% more and are 44% more likely to be promoted than their peers who don’t. Compelling statistics!
Beyond these many benefits, board appointments can also offer a much-desired supplementary or portfolio income. This is why so many aspiring NEDS ask “how much do UK non-executive directors get paid”?
How much do UK non-executive directors get paid?
Whilst remuneration is just one of the seven rewards for serving on a board, for many a board appointment can afford a healthy additional income.
FTSE Chair Remuneration
According to Spencer Stuart average total remuneration for part-time chairs of FTSE 350 companies is £372,980, a decrease of 10% over the past year and the most significant fall in the past seven years. The decline returns total chair remuneration to 2016 levels.
A similar change is observed in the average chair fee, which decreased by 6%, arriving at £387,019 in 2021 compared to £411,406 in 2020.
FTSE Senior Independent Director (SID) Remuneration
Most UK companies pay an additional fee to their Senior Independent Directors (SID). A SID is appointed to provide a sounding board for the chairman and to serve as an intermediary for the other directors when necessary.
Most companies (93%) offer an average additional fee of £22,246 for the senior independent director role, a 3% reduction compared to 200 (£23,015). The fees range from £2,000 at International Public Partnership to £83,838 at Experian.
The average total fee for SIDs is £115,709, 5% less than last year’s average of £121,389, marking the first reduction in the past six years. Senior independent directors who served the whole year received an average total remuneration of £111,994, including the basic and additional fee for the role plus committee membership when applicable.
FTSE Non-Executive Director Remuneration
Basic (base) non-executive retainers have increased by 2%, from £69,606 in 2020 to £70,785 in 2021. This rise keeps up with a trend identified since 2014, and it is the highest average fee recorded to date.
Additional remuneration is paid for Committee Chairs and members as noted below.
Small-Cap Chair & Non-Executive Director Remuneration
According to Alvarez & Marshal Chairs serving on FTSE SmallCap companies earned an average of £143,500. For Chairs for lower quartile businesses £119,500 and upper quartile businesses £173,300.
For Non-Executive Directors the average is £60,000 with lower quartile businesses paying £54,000 and upper quartile businesses £69,000
Additional remuneration is paid for Committee Chairs as noted below.