Here’s Why it Pays to Be a Corporate Director

February 24, 2016, 2:26 PM UTC
Vanity Fair New Establishment Summit - Day 2
Photograph by Michael Kovac—Getty Images for Vanity Fair

CEOs aren’t the only company leaders with escalating salaries.

Non-executive directors at the companies on the S&P 500 saw their pay increase by almost 50% between 2006 and 2014, according to an analysis by the Wall Street Journal. The study of data from MyLogIQ and regulatory filings found that the median pay for an independent board member of an S&P 500 company was $255,000 per year as of the end of October.

The total annual pay for all S&P 500 non-executive directors comes out to $1.4 billion, the Journal notes, with some of the roughly 4,300 people in those roles earning as much as five times the median pay.

Non-executive directors sit on company’s boards but are not part of a company’s executive management team. The role generally requires directors to participate in regular (though, not necessarily frequent) board meetings while helping executives to shape a company’s broad strategy.

Non-executive director salaries fall well short of average pay for CEOs and other leading executives but, as the Journal points out, the position is typically not a director’s primary job.


For example, Apple’s (AAPL) board includes prominent non-executive directors such as former Vice President Al Gore and Walt Disney (DIS) CEO Bob Iger, while Disney’s own board features high-profile tech executives such as Jack Dorsey, CEO of Twitter (TWTR) and Square (SQ), and Facebook (FB) chief operating officer Sheryl Sandberg.

While non-executive directors at many large companies are very well compensated, others (like those at Warren Buffett’s Berkshire Hathaway (BRK)) receive only token compensation.

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