Global Board Remuneration of Large-Cap Companies

In an uncertain world, we are together defining the journey towards a new sustainable future. We expect boards to play a more dominant role in businesses and society at large.

What does this mean for you as boards?

• Governance needs more chair input
• Society expects more from businesses
• Climate change and cyber risks requires businesses to respond
• Crisis leadership is becoming the norm
• More time required for boards to oversee and engage
• Expanding mandates for board committeesInvest in critical board skills for the future
• Ensure competitive board remuneration

How to ensure competitive board remuneration

Here are five key considerations for updating the remuneration policy for board remuneration for the upcoming annual general meetings in 2023 in order to be competitive against the market and attract the best board members:

1. Increase board base fee - as more time is spend in the boardroom on impacts of disruptive times and megatrends (like crisis, ESG, digital and cyber risks), as a result of benchmarking, need for international recruitments and as a result of inflation, as more meetings are held per year, and boards are becoming more active, responsible and competent.
2. Increase board chair multiple - as significantly more time is to be spend on impacts of disruptive times and megatrends, as a result of benchmarking, need for international recruitments, and due to future EU and global developments and defining ‘sustainable leadership’ with CEO.
3. Increase audit committee chair multiple - as significantly more time is to be spend on ESG risk and reporting, cyber resilience and internal controls, as a result of benchmarking and due to future EU and global developments.
4. Establish a sustainability/ESG board committee - as significantly more board work is required, additional committee fee to lead on sustainable transformations, as a result of benchmarking against leading practices (like A.P. Moller Maersk, Equinor, Carlsberg, Nordea and NKT) and the need for ESG (and cyber risk) competences.
5. Be moderate - as different companies are impacted differently and alignment with the wider workforce is important as costs of living increase for all.