Non-exec pay rises to £65,000 with extra legal responsibilities

Tim Wallace
Follow Tim
Sir John Peace is cutting back on directorships as the demands of the job grow
Directors’ pay is rising faster than the average worker’s income, as non-executives are being loaded up with extra legal responsibilities, PwC said this morning.

The average non-executive director (NED) saw their fees rise seven per cent in 2014 to £65,000.

Fees stayed flat in 2013, so the increase in 2014 marks a return to the regular rises seen in the previous five years.

FTSE100 chairmen saw an average increase in fees of three per cent to £373,000.

Heads of board audit committees received the most in additional fees, at £23,000 per year.

Next up was the remuneration committee at £20,000, followed by £15,000 to chair the nomination committee.

Bigger rises could be on the way to make sure non-execs are paid in line with their extensive responsibilities.

“In our experience, non-executive director roles are becoming increasingly challenging, time-consuming and carry a greater reputational risk,” said PwC’s Fiona Camenzuli.

“Some companies will need to make step changes to non-executive director fees to reflect this if they have not done so in recent years.”

Directorships are becoming more time-consuming as a result of new rules and regulations.

Typically following a corporate crisis or scandal, extra responsibilities are loaded onto the non-execs, as part of their oversight role.

For instance in the banking sector, bosses could even face jail if a firm collapses and it can be shown they did not act fully to mitigate the risks the bank was taking in prior years.

Related articles