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.