More Women Coming on Board

27th Jul 2018

Boards of directors are taking on more responsibilities and with that director compensation is increasing. A 2015 Director Survey report showed that larger companies paid higher rates of compensation and had larger percentages of equity-based pay. According to this report, median total compensation paid to non-employee directors ranged from $142, 313 at Small Cap companies to $276, 667 at top 200 companies in 2014.

More women are also joining as board directors. In 2017, Fortune 500 companies filled 358 vacant or newly created board seats with independent directors. More women are on track to gain a record number of boards. Heidrick and Struggles, an executive search firm, published a recent report on Appointments of Women to Boards Hit Record High. The report says in 2017, Fortune 500 companies filled 358 vacant or newly created board seats with independent directors. More than 38%, 137 board seats, went to women in 2017 that marks the highest number of women appointed to boards in the nine-year history of Board Monitor.

We have a client who is one such woman. She runs a consultancy, teaches, and gives speeches. She also sits on multiple boards, each of which pays her sizable fees. She and her husband have a combined business income that exceeds $2 million. We’ve just designed a defined benefit plan that will allow the couple to contribute $519,000 annually, beginning in 2018.

Are you a board member or have clients who are on high-paying corporate boards? Independent directors are usually paid in stock and cash – the cash fees are considered compensation to fund a defined benefit retirement plan.

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