Retail Board Director Pay Decreases Between 2014 & 2015 - BDO Study
Board director compensation levels for middle market companies—including retailers—kept pace with the economy during 2014 and 2015, according to the recently released BDO 600: 2016 Survey of Board Compensation Practices of 600 Mid-Market Public Companies.
The study analyzed proxy statements filed between March 2015 and March 2016 for middle market public companies across eight industries.
Pay ranges varied widely across the industries analyzed, with banking directors at the lowest end receiving an average of $39,511 in total compensation and technology directors at the highest end, averaging $216,394. Retail directors received a slight decrease in pay when compared to the prior year, dropping 2 percent between 2014 and 2015 from $131,064 to $128,860. And while compensation for board members overall remained flat, it decreased slightly among larger companies.
As scrutiny around executive pay intensifies across the board, shareholders and investors are pushing for greater transparency and closer alignment between compensation and performance among Board members as well as executives. In terms of pay mix, retail board compensation is split almost equally between cash (51 percent) and pay in the form of stock (49 percent). The majority of the year-over-year decrease in retail director pay was from the reduction in stock options and full-value stock awards.
Looking ahead to 2016 compensation levels and 2017 compensation planning, modest consumer spending and sales results—as well as mixed company performance—will likely continue to impact pay. As the industry evolves and more dollars shift online, boards have increasing responsibilities, input and oversight on the future of retail. We expect to see pay levels hold steady or perhaps rise incrementality in 2016 and 2017 to reflect these needs and while maintaining a cautious outlook.
To read the full report, click here