17 Aug 2015

Institute of Directors says fees lagging behind

11:04 am on 17 August 2015

A survey of company directors has found only half of respondents felt they were fairly compensated for their work and the level of responsibility they take on.

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Photo: 123rf.com

The Institute of Directors said directors' workloads had almost doubled over the past year, yet fees had increased by only 4 percent.

The institute's chief executive, Simon Arcus, said non-executive directors in New Zealand earn about a third of what overseas directors are paid.

Mr Arcus said it was important that directors were fairly paid for what they do, and the 4 percent increase lagged behind increases other professionals in New Zealand were getting.

"We've got to make sure that we can attract, motivate and retain directors by paying them a fair rate," he said.

A snapshot of the results of the Institute of Directors survey of directors' fee

A snapshot of the results of the Institute of Directors survey of directors' fees. Graphic: Institute of Directors

Overall, wage growth is running at 1.6 percent.

The Shareholders' Association said there was no doubt directors carried a larger workload than they did in the past, but that did not mean there should be an across-the-board increase in their fees.

The association chair, John Hawkins, said one size doe not fit all when it came to what directors should be paid.

"Some companies are paying appropriate fees, some companies are probably slightly high and some companies are clearly behind.

But he added that there was no doubt that being a director was a job.

"It is not actually a handy retirement income," he said.

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