Number of female directors rising, survey finds

Number of female directors rising, survey finds

AUCKLAND, 25 July 2013 – The gender balance in New Zealand boardrooms is changing with more women in director roles according to a new survey. The 2013 Strategic Pay Director Remuneration Survey shows the number of female directors has almost doubled in the past 6 years, from 12.5% in 2008 to 24.3% in 2013. Similarly the proportion of female Chairs has gone from 9.3% to 12.8% over the same period.

John McGill, Chief Executive of consultancy firm Strategic Pay Limited says that, “The rising number of female directors is a trend we expect to see continue. We’re seeing more initiatives to promote greater gender diversity at the board level, particularly as the numbers of women represented on the boards of top 100 NZSX listed companies is smaller than it is in the wider sample of companies.”

A Human Rights Commission report released late year stated that governance experts have long regarded 30% as the level in which a women’s perspective on a board can make a real difference.

Results showed the typical New Zealand director earned a median $34,000 annually in base fees, with chairmen getting a median $65,800. There has been no marked movement with regard to directors’ fees in the past year. Based on a sample of 1,436 directorships the median fee has only increased by 1.2% in the last twelve months according to the survey, which has tracked directors' pay for twenty one years.

Mr McGill commented, “Large increases in director remuneration by individual organisations often make headlines, but this is not really indicative of the wider market, overall there continues to be moderation and restraint in director fee increases. Longer terms trends over the past ten years do not show significant increases.”

Over the last three years the rolling trend for director fee increases has been a median annual movement of 4.5% for Non-Executive Directors and only 1.8% for the Chair. Since 2003, the median Non-Executive Director fee has increased by 36%, an average of 2.8% per year over 10 years, compared to 2.5% per year for CPI.

Mr McGill suggests that given market recognition of the value of good governance as well as the growing pressure on board performance in a company’s results, the level of current fees across the broader Public and Not for Profit Sectors remains a serious concern in the attraction and retention of appropriately qualified individuals.

“This is especially so where there is a Trans-Tasman connection and as the report shows there is significant disparity between New Zealand and Australian levels when considering similar sized organisations from a market capitalisation perspective,” he says.

The Strategic Pay Directors’ Fees Survey is the longest running and most authoritative directors’ remuneration survey in New Zealand.

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