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The directors & boards survey: CEO and executive compensation 2009.

Article Excerpt
Co-sponsored and analyzed by Farient Advisors LLC

The 2009 Directors & Boards 2009 CEO and Executive Compensation Issues and Governance Survey, co-sponsored by Farient Advisors LLC and Directors & Boards Magazine, reveals that corporate directors, executives and shareholders believe that excessive executive compensation is a significant issue. However, not surprisingly, most of the survey respondents do not feel as though more government intervention is the answer. Instead, most view "self-help," particularly in the areas of assessing the effect of the compensation system on risk-taking behavior, improving performance measurement, and strengthening the link between performance and pay as the right path forward.

The degree of change that the survey's respondents are advocating with respect to executive compensation has begun to translate into changes to programs and practices, but so far, these actions have not matched the

Methodology and Demographics

This Directors & Boards/Farient Advisors LLC survey was conducted in March 2009 via the web, with an email invitation to participate. The invitation was emailed to the recipients of Directors & Boards' monthly e-Briefing. A total of 337 usable surveys were completed, level of rhetoric on the subject. Seventy-two percent of the organizations responding are not completely satisfied with the advice they are receiving from compensation consultants, which may account for some of the gap between intentions and actions.

About the respondents (Multiple responses allowed) A director of a publicly held company 34.1% A director of a privately held company 42.5% A director of a non-profit entity 37.7% A senior level executive (CEO, CFO, CxO) of a publicly held 9.9% company A senior level executive (CEO, CFO, CxO) of a privately 23.7% held company Shareholder 40.4% Advisor (auditor, consultant, attorney or other board 33.5% advisor) Academic 7.8% Other 6.3% Board service (Average number of boards respondents serve) Public 1.16 Private 1.49 Charitable 1.59 Compensation involvement (Respondent's role in determining or approving executive compensation) Compensation Committee chair 13.7% Compensation Committee member 24.6% Board member, but not on the Compensation Committee 26.3% CEO 9.8% CFO 1.4% Chief HR Officer 1.8% Other senior executive 5.3% Not involved in executive compensation decision-making 17.2% Revenues (For the primary company of the respondent) Average revenues $2.2 billion Less than $1 billion 69.0% $1 billion to $10 billion 20.7% More than $10 billion 10.3% Total CEO compensation (in $US, including salary, bonuses, long-term compensation, benefits and perquisites, for fiscal year 2008) Average $1,945 million Less than $250,000 20.5% $251,000 to $500,000 23.5% $501,000 to $999,000 13.0% $1...

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