• Steven Hall & Partners

2020 Director Compensation Study

Updated: Oct 26

This represents Steven Hall & Partners’ 14th annual study of compensation paid to non-employee directors. Our review included 600 companies in the following three groups:

  • Top 200 – 200 companies with the largest revenues in fiscal 2019

  • Mid Cap 200 – 200 companies included in the S&P MidCap 400®

  • Small Cap 200 – 200 companies included in the S&P SmallCap 600®


Total Compensation – 2019 Values

We note director compensation amounts continue to be correlated to company size and complexity. Among the three groups studied, the Top 200 pays the highest compensation to directors, followed by Mid Cap 200 and Small Cap 200 companies, respectively. In 2019, median total compensation for the Pro Forma Director ranged from $192,250 at Small Cap companies to $315,000 at Top 200 companies.


Total Compensation – One Year Growth

One-year growth calculations only include companies that were a part of our study both this year and last year, which represents:

  • 162 (81%) of Top 200 companies

  • 171 (86%) of Mid Cap 200 companies

  • 175 (88%) of Small Cap 200 companies

Year-over-year median total compensation growth for the five straw positions is displayed below:


Total Compensation – Three-Year Growth

Three-year growth calculations only include companies that were a part of our four most recent studies, which represents:

  • 147 (74%) of Top 200 companies

  • 133 (67%) of Mid Cap 200 companies

  • 136 (68%) of Small Cap 200 companies

For the companies that were included in our last four studies, three-year total compensation growth for the Pro-Forma Director position in each of the three groups is displayed below:


What to expect in 2021

  • Lower increases in director compensation levels relative to previous years. With the presence of COVID-19 and the uncertainty that surrounds the pandemic, many boards have reduced or frozen director compensation until business and the economy return to normal

  • Increased use of limits in director compensation plans

  • Increase in share ownership guideline prevalence and guideline value


Things to consider when conducting an annual review of director compensation

  • Is the current director compensation program competitive with regards to compensation levels and mix of cash and equity?

  • Does it allow the company to attract and retain high quality director candidates?

  • Are modifications to the director compensation program sustainable, appropriate and reflective of projected market increases and company growth?

  • Is the program’s structure aligned with the current best practice of delivering at least half of total value to directors in the form of equity?

  • How will modifications to the director compensation program affect total board cost?

How does your company compare?

We welcome the opportunity to further discuss this study and provide additional pay level data that is specific to your industry and organization size.

Please contact us at shp@shallpartners.com for more information.




© 2020 by Steven Hall & Partners LLP.

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