Corporate Eye

Board Compensation On Websites

How much companies pay their Boards continues as a much debated and highly controversial subject. Even companies with overall good Corporate Governance practices seem to mask what their Board members are paid. There are some standout companies, for example an April 2007 Wall Street Journal article stated —

Nearly 30% of proxy statements filed so far this year contain supplemental pay information, estimates Mark Borges, a principal at Mercer Human Resource Consulting. El Paso Corp., Intel Corp., Corning Inc., EMC Corp. and Pfizer Inc. are among those disclosing more than the Securities and Exchange Commission requires.

Not bad but where are the other 70%?

With all the commentary about Governance Transparency, it should be a ‘no-brainer’ to use company websites to display Board compensation. As with most business issues there are a few trailblazers.

First there’s Omron, a Japan based conglomerate with 783 Billion Yen sales. On their website they describe how Directors are compensated in detail (see image alongside).

A visit to Omron’s Corporate Governance website will also show their clear description of their Governance System, including a very detailed review of how Directors are selected.

Another company of note is The St. Joe Company, one of Florida’s (USA) largest real estate operating companies and the state’s largest private landowner. Their website clearly displays how much Directors are paid (see image)

You may want to view their Governance Policies section for a very good display of what they practice.

These companies are noteworthy for their transparency in using their websites to explain and disclose Board compensation.

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Ed Konczal has an MBA from New York University's Stern School of Business (with distinction). He has spent the last 10 years as an executive consultant focusing on human resources, leadership, market research, and business planning. Ed has over 10 years of top-level experience from AT&T in the areas of new ventures and business planning. He is co-author of the book "Simple Stories for Leadership Insight," published by University Press of America.