For the second consecutive year, compensation for outside directors at the nation’s largest corporations increased modestly, according to an annual analysis of Fortune 500 companies by global professional services firm Towers Watson. Although overall pay levels were stable, companies are continuing to refine the design of their director pay packages in response to both internal and external pressures, it says.
Towers Watson found that total compensation for directors in 2011 climbed 5% over 2010 levels, on par with a 6% median increase in director compensation in 2010. Much of the increase was attributed to rising levels of stock compensation and higher stock prices. Total direct compensation (including cash pay and annual or recurring stock awards) increased in 2011 to a median value of $220,000, up 5% from 2010. More than half (55%) of director pay came from equity in 2011, while 45% was from cash.
