What do non executive directors earn

Offshore non-executive director pay. What do non-executive directors earn?

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An explanation of offshore non-executive director pay

Just as salaries vary greatly across and within professions, there are vast differences in offshore non-executive director pay.

Some organisations in offshore jurisdictions pay non-executive directors more than many executive directors. However, other roles are unpaid.

You’re most likely to find roles which do not include a salary in the not-for-profit sector. Nevertheless, an organisation should still cover necessary expenses.

According to Glassdoor, the average remuneration for a non-executive director in the UK is just under £75,000 a year. When you consider this figure includes 24 salaries, ranging from £20,000 to £139,000, you see how varied pay rates are.

It is also important to remember some pay rates are quoted by the day, or the hour, rather than as an annual rate. Other positions may include a bonus, or other benefits.

Offshore non-executive director pay rates are not dissimilar to the UK and may even be slightly higher for specialised roles where there is more competition to secure a NED from a smaller talent pool.

Higher pay for more demanding roles

According to the PwC Channel Islands NED Remuneration Survey 2018/19, NEDs in London Stock Exchange Premium Listed Entities receive an average annual salary of £180,000. This is up from £143,000 in 2015. Figures come from a survey of over 100 NEDs based in the Channel Islands so give a fair perspective on offshore non-executive director pay for premium roles with significant companies in Jersey and Guernsey.

Higher pay generally reflects more demanding roles, where NEDs take on additional responsibilities or positions on the board.

Shelley Kendrick, Founder, Club NED said: “Top level roles command top level talent. This means highly experienced NEDs, working with listed entities can command the highest rates of pay. NEDs in such roles need the time and professional expertise to take businesses forward in potentially challenging circumstances.”

Diversity on boards

Research by Deloitte shows female representation on UK boards is 22.7%. Globally 16.9% of board members are women, a 1.9% rise since 2017. The ‘Women in the Boardroom: A Global Perspective’ report found companies with a female Chair or Chief Executive had nearly twice as many female directors (28.3%).

With a 40% gender quota since 2005, Norway, has the highest level of female representation at board level. This is followed by France, which has had a 40% quota since 2017. And then by Belgium, which requires boards to ensure at least one-third of members are female, and one-third male.

Research by Cranfield University found the number of women on FTSE 100 boards rose from 29% to 32% from 2018 to 2019. For FTSE 250 companies it rose from 23.7% to 27.3%. The Female FTSE Board Report 2019 showed a significant gap between the proportion of female executives and non-executives. Women comprised 38.9% of non-executive directors on FTSE 100 boards and 32.8% of FTSE 250 boards.

Shelley said: “Diversity is an important issue and offshore boards want to secure experienced non-executive directors who improve diversity. This may cover gender, ethnicity, sexuality, or social background. Organisations in the Channel Islands recognise the important contribution a more diverse board can make.

“We hope Club NED will help improve diversity on boards by helping offshore boards find candidates from a broader talent pool, and help candidates find out about positions they might not otherwise have thought about.”

Wonder what you could earn as a non-executive director in the Channel Islands? Join Club NED to get in the know.

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