James Okafor· VP, Total Rewards, Halcyon Financial Group
Asked in Executive Compensation ·
I look after board remuneration at a member-owned insurer in Australia with about A$9bn in assets. Fees have not moved in four years: A$95,000 base for a director and A$210,000 for the chair. We are struggling to attract directors with actuarial and technology backgrounds.
Listed insurers of our size pay roughly 60% more, but members will reasonably ask why a mutual should match listed companies. The other mutuals publish very little.
How have others built a defensible comparator group for director fees outside the listed sector?
0 reactions · 3 replies · 4 views
Accepted answer· by Dana Whitfield
Build it from time commitment rather than from market position. We counted days: board, committees, regulator meetings, preparation. It came to 55 days a year for a director and 110 for the chair. Dividing the fee by days gave a day rate that members could compare with what the organisation pays senior professional advisers. On that basis our fees were clearly low, and the increase of 18% phased over two years went through the annual meeting with 89% in favour. The listed comparison appeared only as a footnote.
Read in the conversation ↓
Nadia HaddadCRP
Director of Rewards, MEA, Qasr Holdings
We use three reference points and show all of them: other mutuals and member-owned funds, listed financial companies of similar balance sheet size, and large not-for-profits and government-owned corporations. Our policy is to sit between the first and second, about 20% below the listed median. Stating the discount openly was what members responded to.
Dana WhitfieldCRP, GRS
Director, Global Compensation, Meridian Health Systems
Accepted answer
Build it from time commitment rather than from market position. We counted days: board, committees, regulator meetings, preparation. It came to 55 days a year for a director and 110 for the chair. Dividing the fee by days gave a day rate that members could compare with what the organisation pays senior professional advisers.
On that basis our fees were clearly low, and the increase of 18% phased over two years went through the annual meeting with 89% in favour. The listed comparison appeared only as a footnote.
Priya RaghunathanGRS, CSI
Head of People Analytics, Calibre Software
Separate the skills problem from the fee level. We kept base fees modest and raised committee chair fees sharply, risk and audit to A$40,000 each, because that is where the specialist directors carry the load. It cost a third of what an across-the-board rise would have.
