Tendances claires eu égard à la rémunération des administrateurs de sociétés


En gouvernance, on fait très souvent référence aux mécanismes de rémunération de la direction des entreprises mais on s’interroge assez peu sur la rémunération des administrateurs. Également, il y a peu d’études sur le sujet.

L’article qui suit a été publié par Ira Kay* dans le Harvard Law School Forum on Corporate Governance. L’auteure confirme que les administrateurs de sociétés sont de plus en plus sollicités; ils sont donc appelés à investir de plus en plus de temps dans leurs fonctions et ils doivent assumer plus de risques.

La rémunération des administrateurs augmente d’environ 5 % par année et les paiements se font généralement sur une base de 50 % en argent et 50 % en actions à paiement différé.

Les tendances qui se dessinent sont claires. En voici un extrait :

Bonne lecture !

Trends in Board of Director Compensation

Summary and Key Findings

  1. In recent years, total pay has increased by, on average, less than 5% per yearP1040988
  2. Most companies make pay changes less frequently (e.g., every two or three years)
  3. Most large cap companies have eliminated regular meeting fees, in favor of higher annual cash/equity retainers
  4. Equity awards, which are most often RSUs or some other type of full-value award, typically represents 55% to 60% of total pay
  5. Near universal practice of having stock ownership and/or stock retention requirements, such as deferred stock units that are held until after board departure
  6. Some pay practices vary widely by industry and company size; for example smaller cap companies continue to provide meeting fees and may also grant stock options
  7. In the future, we expect annual director pay to increase, on average, by 3% to 5% and the weighting on equity awards to increase

Cash Compensation

The traditional directors’ compensation program included both an annual retainer and a separate fee provided for attending Board and Committee meetings. The presence of a meeting fee encouraged meeting attendance and automatically adjusts for workload as measured by the number of Board and Committee meetings. Meeting attendance is less of an issue today as companies disclose whether their directors attend at least 75% of meetings and proxy advisors scrutinize those directors who fail to meet the threshold. In recent years, most large companies and more mid-sized and small companies have simplified their approach to delivering cash compensation by eliminating the meeting fee element and instead providing a larger single cash retainer. The rationale for this change is to ease the administrative burden associated with paying a director a fee for each meeting attended and to communicate that meeting attendance is expected with less emphasis on actual time spent and more emphasis on the annual service provided to shareholders. We expect this shift to continue among smaller and mid-sized companies where the elimination of meeting fees is not yet a majority practice.

Equity and Cash Compensation Mix

Over time, as director compensation has increased, the trend has been to provide greater focus on equity compensation, which provides direct economic alignment to the shareholders who directors represent. Currently, it is common to have equity represent a slight majority of regular annual compensation – such as a pay mix of equity compensation 55% and cash compensation 45%. In analyzing broad market practices, we typically find directors’ total compensation allocated 40% to 50% to cash compensation and 50% to 60% to equity compensation. The emphasis on equity compensation is also directionally consistent with the typical pay mix for senior executives.

Equity Grant Design

In the early 2000s, stock options delivered most or all of director equity compensation, similar to the approach for compensating executives. The current trend has shifted to the use of full-value shares to deliver all (or at least most) of equity compensation. This shift in approach was driven by the change in accounting standards, negative views of stock options as a compensation vehicle for directors (and executives), and other factors. As a result, today, the most common market practice is to deliver equity compensation solely through full-value shares; a minority of companies (typically 25% or fewer, depending on the set of companies analyzed) continue to grant stock options.

Companies vary in the delivery of the full-value shares with the most common approaches including:

  1. Restricted stock/units, which have a restriction period that may range from six months to three years
  2. Deferred stock units, in which actual share are not delivered or sold until departing the Board
  3. Outright grants, which are immediately vested at grant

The use of performance‐based awards for directors is nearly non‐existent due to the desire to avoid any misperceptions between compensation and their duties and fiduciary responsibilities.

Board Leadership Compensation

Today independent directors are either led by a Non-Executive Chairman (at companies who have separated the leadership role) or a Lead Director (for companies who maintain a combined Chairman and CEO role or an Executive Chairman). At companies who have separated the Board Chairman and CEO roles, an independent Non-Executive Chairman is appointed to lead the independent directors. The responsibilities of this position vary by company as does the amount of additional compensation, which is provided through cash, equity or a combination thereof. At the low end of the spectrum, the Non-Executive Chairman’s extra retainer is positioned modestly above the extra retainer provided to the Audit Committee Chairman (or the Lead Director, which is discussed below) or at the high end of the spectrum, the additional retainer can be significantly higher, such as an additional $200,000 or more.

For those companies who have decided to continue with a single combined role, an independent director serving in the role of Lead Director (or Presiding Director) has emerged as a best practice to lead executive sessions of independent directors. When this role emerged in the mid-2000s, the Lead Director often received no additional compensation and frequently rotated among independent Committee Chairmen or was represented by the Governance Committee Chairman. More recently, for companies to maintain the combined role of Chairman and CEO, Lead Directors have become more prominent and are now typically appointed by the independent directors and are compensated with an additional retainer.

Board Committee Chairmen are typically provided an extra retainer to compensate for the additional work with management and outside advisors in preparing to lead committee meetings. Following the introduction of Sarbanes-Oxley, the extra retainer provided to the Chairman of the Audit Committee increased at a higher rate than other committee chairmen in recognition of the additional workload in terms of number of meetings and required preparation, heightened risk, and the financial expertise required of the position. Following the introduction of the enhanced proxy disclosure rules in 2006 and the Say on Pay advisory vote in 2010, extra retainers provided to the Chairman of the Compensation Committee increased to be positioned closer to (or just below) that of the Audit Committee Chairman.

Stock Ownership Guidelines and Requirements

There is near universal use of stock ownership guidelines or holding requirements for directors, which is consistent with the prevalence of requirements for senior executives. In order to align directors’ economic interests with the shareholders they represent, companies typically provide full-value equity awards and require minimum stock ownership specified as a multiple of the annual retainer or equity award value. At larger companies, the minimum stock ownership guideline is typically three to five times the annual retainer or equity award value with the expectation that this will be achieved within five years of joining the Board. Some companies also have stock holding requirements, which may be used in addition to stock ownership guidelines. For example, companies may require directors to retain net (after tax) shares upon lapse of restrictions until the minimum stock ownership guideline is achieved. Other companies may solely use stock holding requirements (such as grant equity compensation as deferred stock units) to ensure directors accumulate and retain meaningful levels of stock ownership through their tenure as a director.

Contemporary Best Practices

Over time director compensation levels and program design have evolved to address the changing regulatory environment and the enhanced role of the typical director, as described above. Director compensation arrangements have settled to a general design adopted by most companies:

– Annual cash retainer representing approximately 40% to 45% of the total program value

– Annual equity award most often delivered through full-value shares that vest after a specified time and representing approximately 55% to 60% of the total program value

– Extra cash retainers for Non-Executive Chairman, Lead Directors and Committee Chairmen

– Stock ownership guidelines representing three to five times the annual retainer, with stock holding requirements of new grants until the ownership guideline is achieved.

________________________________

*Ira Kay is a Managing Partner at Pay Governance LLC. This post is based on a Pay Governance memorandum by Steve Pakela and John Sinkular.

Auteur : Gouvernance des entreprises | Jacques Grisé

Ce blogue fait l’inventaire des documents les plus pertinents et récents en gouvernance des entreprises. La sélection des billets, « posts », est le résultat d’une veille assidue des articles de revue, des blogues et sites web dans le domaine de la gouvernance, des publications scientifiques et professionnelles, des études et autres rapports portant sur la gouvernance des sociétés, au Canada et dans d’autres pays, notamment aux États-Unis, au Royaume-Uni, en France, en Europe, et en Australie. Chaque jour, je fais un choix parmi l’ensemble des publications récentes et pertinentes et je commente brièvement la publication. L’objectif de ce blogue est d’être la référence en matière de documentation en gouvernance dans le monde francophone, en fournissant au lecteur une mine de renseignements récents (les billets quotidiens) ainsi qu’un outil de recherche simple et facile à utiliser pour répertorier les publications en fonction des catégories les plus pertinentes. Jacques Grisé est professeur titulaire retraité (associé) du département de management de la Faculté des sciences de l’administration de l’Université Laval. Il est détenteur d’un Ph.D. de la Ivy Business School (University of Western Ontario), d’une Licence spécialisée en administration des entreprises (Université de Louvain en Belgique) et d’un B.Sc.Comm. (HEC, Montréal). En 1993, il a effectué des études post-doctorales à l’University of South Carolina, Columbia, S.C. dans le cadre du Faculty Development in International Business Program. Il a été directeur des programmes de formation en gouvernance du Collège des administrateurs de sociétés (CAS) de 2006 à 2012. Il est maintenant collaborateur spécial au CAS. Il a été président de l’ordre des administrateurs agréés du Québec de 2015 à 2017. Jacques Grisé a été activement impliqué dans diverses organisations et a été membre de plusieurs comités et conseils d'administration reliés à ses fonctions : Professeur de management de l'Université Laval (depuis 1968), Directeur du département de management (13 ans), Directeur d'ensemble des programmes de premier cycle en administration (6 ans), Maire de la Municipalité de Ste-Pétronille, I.O. (1993-2009), Préfet adjoint de la MRC l’Île d’Orléans (1996-2009). Il est présentement impliqué dans les organismes suivants : membre de l'Ordre des administrateurs agréés du Québec (OAAQ), membre du Comité des Prix et Distinctions de l'Université Laval. Il préside les organisations suivantes : Société Musique de chambre à Ste-Pétronille Inc. (depuis 1989), Groupe Sommet Inc. (depuis 1986), Coopérative de solidarité de Services à domicile Orléans (depuis 2019) Jacques Grisé possède également une expérience de 3 ans en gestion internationale, ayant agi comme directeur de projet en Algérie et aux Philippines de 1977-1980 (dans le cadre d'un congé sans solde de l'Université Laval). Il est le Lauréat 2007 du Prix Mérite du Conseil interprofessionnel du Québec (CIQ) et Fellow Adm.A. En 2012, il reçoit la distinction Hommage aux Bâtisseurs du CAS. En 2019, il reçoit la médaille de l’assemblée nationale. Spécialités : Le professeur Grisé est l'auteur d’une soixantaine d’articles à caractère scientifique ou professionnel. Ses intérêts de recherche touchent principalement la gouvernance des sociétés, les comportements dans les organisations, la gestion des ressources humaines, les stratégies de changement organisationnel, le processus de consultation, le design organisationnel, la gestion de programmes de formation, notamment ceux destinés à des hauts dirigeants et à des membres de conseil d'administration.

Qu'en pensez-vous ?

Entrer les renseignements ci-dessous ou cliquer sur une icône pour ouvrir une session :

Logo WordPress.com

Vous commentez à l’aide de votre compte WordPress.com. Déconnexion /  Changer )

Photo Google

Vous commentez à l’aide de votre compte Google. Déconnexion /  Changer )

Image Twitter

Vous commentez à l’aide de votre compte Twitter. Déconnexion /  Changer )

Photo Facebook

Vous commentez à l’aide de votre compte Facebook. Déconnexion /  Changer )

Connexion à %s

Ce site utilise Akismet pour réduire les indésirables. En savoir plus sur la façon dont les données de vos commentaires sont traitées.