Record Earnings for Outside Board Members - Study

According to a recent study conducted by the global management consulting firm of Towers Perrin and reported by, the average total compensation for outside board members of S&P 500 companies has sky rocketed. The average compensation in 2000 according to the study was $100,807.

This increase according to the study is mainly due to the growing number of companies compensating their directors with stock options instead of cash payments. Other findings of the study are highlighted below:

  • Average stock compensation increased in 2000 to $59,430, up from 45,500 in 1999.

  • The average cash compensation fell in 2000 to $46,000, from $48,200 in 1999.

  • Of the companies surveyed, 89 percent of them offered annual stock-based grants to outside directors, while only 11 percent paid annual compensation entirely in cash.

  • The study revealed that committee chairpersons receive a $4,000 average retainer and a fee of $500 per committee meeting.

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