Board Advisory
Pretium has rich experience in corporate governance. We have helped our clients with a wide spectrum of related projects:
Benchmarking of Independent Non-Executive Director Fees
Independent non-executive directors (INED) play an important role within the organization. They shoulder significant responsibilities in corporate governance through serving on the board and its sub committees. With the waves of Remuneration Committee meetings in February and March, it is right time to review the fees for INED properly.
Instead of fee review conducted simply on an inflation or ad-hoc basis, systematic benchmarking of INED fees could ensure that INEDs' compensation appropriately reflects their increased responsibilities in the business, and in turn raise the company's competitiveness in terms of top talent attraction and retention.
Pretium INED Fee Levels and Structure Study contains the benchmarking analysis of 64 Hang Seng Index Constituents Companies and examines the market level of INED fees and structure.
To ensure comprehensive reflection of the INED fee structure so as to provide systematic reference, especially when there are changes in responsibilities among INEDs, we have broken down the market data into 3 categories:
- Basic Fee: Fee received by INED for attending board meetings
- Committee Fee: Additional fee for INED serving as Chairman or members of sub committees
- Total Fees: Board fee plus committee fee
Based on the findings, INED receive additional fees when serving different committees and the fees would be higher for the Chairman role. Companies should review INED fee payout if there are changes in INED responsibilities, e.g. number of committees to serve or meetings to attend.
The study also contains analysis regarding to comparison of fee levels in different industries, additional fees for different sub committees, and the application of long-term incentives for INEDs.
Apart from the standard report, Pretium has assisted numerous listed companies in conducting a tailor-made benchmarking against target firms of similar business nature and market capitalization. Moreover, we are able to advise the appropriate fee structure to best fit your corporate governance needs.