Corporate directors harder to find than ever

Neff is U.S. chairman of Spencer Stuart, the firm that dominates the market for U.S. board searches. Spencer Stuart has recruited directors for giants like Wal-Mart , IBM , AIG , and General Motors . In his spare time, Neff has conducted CEO searches at Merrill Lynch , Sprint Nextel , and Boeing .

“More and more board candidates are saying that it’s just not worth it,” Neff says about the challenge of recruiting star executives for corporate boards. Since Sarbanes-Oxley became law in 2002, a typical corporate director’s time commitment has risen sharply. “I’d say by 50%,” he estimates, to about 200 hours a year. And for a troubled company (that’s most companies these days!), reputation can be a major turnoff. “Who wants to have their picture, along with a dozen other directors, in a New York Times story about a company in trouble?” Neff asks.

Moreover, compensation often doesn’t make up for the hassle. After Sarbanes-Oxley was enacted, director pay increased some 15% annually, Neff says. It’s still rising, but at a much lower rate. Today a directors at the top tier of Fortune 500 companies typically pocket about $200,000 a year.

So companies are forced to be flexible. Some are moving board meetings to easy-to-access locations — say, from a small town where a company is headquartered to a major metropolitan city. The biggest companies provide air transport for directors. “Retired CEOs who had their own plane typically won’t join a board if the company doesn’t provide a private plane to the meeting,” Neff explains.

Indeed, retired CEOs and big swinging shareholder activists. Remember when Carl Icahn forced his way onto the board of Blockbuster ? Icahn, who doesn’t like to leave New York City, got Dallas-based Blockbuster to move its board meetings to his hometown. That’s power.

P.S. For more on Neff and his longtime headhunting rival, Gerry Roche of Heidrick & Struggles , see my 2005 Fortune story, Clash of the CEO Kingmakers.