Non-Executive Director (NED) Compensation
Overview
The contribution of Non-Executive Directors (NEDs) to the overall performance of an organisation cannot be underestimated. Hence, it is crucial to compensate them for the value they bring to the table. However, the compensation structure for NEDs is significantly influenced by country-specific regulations as well as industry-specific regulators. In India, for instance, RBI and IRDAI regulations play a major role in influencing NED compensation. At Exec-Rem, we assist organisations in making informed decisions on NED compensation by providing data-backed insights.
Support We Offer
- Definition of NED compensation peer groups
- Detailed analysis of NED compensation which includes:
- Per meeting / sitting fee philosophy for Board / Committee meetings
- Differentials in per meeting / sitting fee for different committees
- Total sitting fees paid in the year per NED
- Total commission / fixed fees paid in the year per NED
- Total sitting fees paid in the year per NED / Independent Director
- Total commission / fixed fees paid in the year per NED / Independent Director
- Total sitting fees paid by company in aggregate to all NEDs
- Total sitting fees paid by company in aggregate to all NEDs
- Total sitting fees paid by company in aggregate to all NEDs / Independent Directors
- Total commission / fixed fees paid by company in aggregate to all NEDs / Independent Directors
- Total commissions / fixed fees as percentage of profits
- Any formulaic approach to determining commissions by peers
- Other nuances (e.g., additional payments to Board Chair, Committee Chairs, Foreign Directors, etc., differentials in promoter / non-promoter NED compensation)
