How much do board members make? A complete guide to board compensation
“How much do board members make?” is a simple question with a complicated answer. The simple answer is that some board directors get paid, and some don't. Regardless of whether or how much they get paid, board directors are bound by their fiduciary duty to do their best in planning and overseeing their organizations.
Board director responsibilities are only slightly more challenging than they’ve been over the last decade or so, but they may seem heavier for a couple of reasons. Since the 2008 financial crisis, investors and regulators have been more strongly scrutinizing both board and director performance. In learning more about what corporate board directors get paid and how they get paid in comparison with their median employees, financial experts and others who work in the industry are becoming increasingly concerned about the disparity between the board and senior executive pay and pay for the rest of their employees.
You might be surprised at the answer to the question, 'How much do board directors get paid?' The consensus is that board directors' pay for corporate boards is high overall. Here, we’ll dig into what the data says about how much board members get paid, including:
- Average board member compensation across public and private companies and different types of boards
- How board members earn their salaries
- An overview of typical board member compensation packages, perks and benefits
- Factors that influence how much board members make
- The highest-paid S&P 500 boards
- Legal and ethical considerations
How much do board members make?
How much board members make varies widely and depends on the type of board they’re on. Average board compensation ranges from a $40,000 annual retainer to over $300,000 annually, with compensation often representing a mix of equity and cash.
This is, indeed, a significant range, which is why it helps to look at different types of boards and the compensation for each:
Public companies
Board members for public companies routinely made the most when compared to their counterparts. According to Spencer Stuart’s 2024 S&P 500 Director Compensation Snapshot, the average total compensation for S&P 500 directors is $327,092 — an increase of 1.8% from 2023.
Independent chairs often receive additional compensation, with premiums ranging from $25,000 to $500,000.
Private companies
Members of private company boards tend to make less than those on public boards. A Private Company Director survey found that the median total compensation was $40,000 in 2024. Like public boards, private board chairs also received a premium, but the median was just $20,500.
Type of board
The sector often impacts how much board members make, but so do specific industries, such as:
- Hospital boards: Only 27% of nonprofit hospital boards provide any form of compensation; those that do may compensate board members as little as $10,000 or as much as $200,000 if it’s a large nonprofit health system like Kaiser Permanente. For-profit hospital boards tend to pay more; for example, HCA Healthcare provides non-management directors with an annual retainer of $110,000.
- Advisory board members: Compensation for advisory boards also varies. A startup may offer advisory board members equity, while an established private company could pay $10,000 to $50,000 annually.
- Nonprofit board: The simple answer to what nonprofit board directors get paid is usually nothing. According to the Internal Revenue Service (IRS), charities shouldn’t pay their boards for their leadership services except to reimburse them for reasonable, board-related expenses. Just like other volunteers, board directors may deduct their non-reimbursable expenses for nonprofit work, including mileage expenses, when they use their own car. For board directors who get paid more than $600 per year, the nonprofit must give them a 1099.
- School board: The pay of school board members depends on state laws, district policies and the size and location of the school district. Some board members are unpaid, while others receive salaries. Los Angeles is the highest-paying school district, offering board members $125,000 annually if they don’t have other employment and $50,000 if they hold a job.
How do board members earn their salaries?
Within the last few decades, there has been much more concern and scrutiny over corporate board performance. In years past, many boards only met a few times per year. The company paid for their meals, transportation and lodging and received compensation in the form of cash, stocks and retainers. Corporate board directors usually get paid for attending meetings, serving on committees and serving as committee chairs.
Today, boards are expected to practice strong oversight and both short- and long-term strategic planning. Boards also deal with issues such as risk management, cybersecurity, increasing diversity, and improving their own performance. Here’s how they earn their salaries:
- Strategic guidance: Board members shape the long-term vision of an organization. They help set priorities, approve major initiatives and evaluate progress against strategic goals. Their insight — especially in sectors like healthcare, finance or tech — can guide critical decisions that affect the organization’s future.
- Financial oversight: A key fiduciary duty of board members is financial stewardship. They review and approve budgets, oversee audits and ensure funds are used in alignment with the mission or shareholders’ interests.
- Governance and policy setting: Board members establish governance policies, ensure legal and ethical integrity and evaluate organizational performance. In many cases, they’re responsible for hiring, evaluating and, if necessary, removing the CEO or executive director.
- Committee participation: Most board members serve on one or more committees, such as audit, compensation, or nomination/governance. These smaller groups dive deeper into complex issues and make informed recommendations to the full board. Committee work often justifies additional compensation due to the time and expertise required.
- Risk management and accountability: In both corporate and nonprofit settings, boards are legally liable for overseeing risk and compliance. They help the organization adhere to regulations, avoid conflicts of interest and build crisis response plans.
- Relationship building and fundraising: In nonprofits and educational institutions, board members often use their relationships and networks to contribute to fundraising efforts and enhance the organization’s visibility.
- Time and expertise: Compensation often reflects the time commitment (board meetings, committee work, preparation) and the specialized expertise board members bring. Many have been re-selected for their leadership in law, finance, industry-specific knowledge or public policy.
Ready to be a board member?
Get the seven steps you can take to increase your chances of a board appointment.
Discover moreBoard member compensation overview
How much board members make is usually compensated in cash, equity, and other benefits. Here’s how it usually breaks down:
- Annual retainer: Board members get paid a flat yearly fee for their service, which is only a portion of total compensation. It can range from $25,000 to $100,000 and more and is paid in cash, stock or a combination.
- Per-meeting fees: Smaller private companies, advisory boards, and nonprofits may also pay board members to attend meetings, usually $1,000 to $5,000 per meeting.
- Equity: Public and startup companies often offer equity to make the compensation package more attractive. This may include stock options, restricted stock units (RSUs) or outright stock grants. Doing so also aligns board members’ interests with shareholders.
- Committee chair/member fees: Board members may also receive additional compensation for committee service, particularly if they’re the chair. Committee chairs can receive $10,000 to $25,000 or more on top of base compensation.
- Board chair premium: Given their expanded responsibilities, board chairs may also receive higher compensation. These premiums range from $25,000 to $100,000 or more, depending on the organization’s size and the scope of their role.
- Deferred compensation: Some organizations allow board members to defer their compensation in a retirement-style plan. This is more common among corporate and large nonprofit boards.
Perks and non-monetary benefits
Board member compensation often doesn’t stop at cash and equity. They are often compensated in other ways to make their total package more attractive, including:
- Expense reimbursement: It’s standard across sectors to reimburse travel, lodging, meals and other business expenses.
- In-kind benefits: While rare, these benefits may include access to facilities, event tickets or wellness programs, especially in university or healthcare settings.
- D&O insurance: Directors and officers insurance protects board members from legal liability in the event of lawsuits or claims. This coverage is crucial for both corporate and nonprofit boards, especially those with fiduciary risk.
- Professional development: Board members may have opportunities to attend exclusive conferences, training or governance workshops. Covering this cost can signal an investment in board members’ ongoing learning.
- Exclusive networking and events: Board members often receive invitations to donor galas, investor summits, private receptions or leadership retreats. These opportunities are widespread in nonprofit and foundation boards where visibility is part of their role.
- Recognition and prestige: While intangible, board service can significantly bolster a member’s profile. Serving on a board can yield dividends in the form of an enhanced resume, respect in one’s professional field and the ability to influence public policy or industry standards.
Inside board compensation
Understand the ideal recipe for crafting board compensation that attracts top talent and aligns the board's interests with shareholders'.
Discover moreKey factors influencing how much board members make
Many factors come into play when deciding how much board directors get paid. Public companies issue an annual proxy statement revealing how much they pay board directors. Most companies now also post this information on their corporate website.
Board directors consider many things when determining how much to pay themselves. It makes sense for wealthier corporations to pay high salaries to attract the best possible candidates to the board, who will help them increase profitability while monitoring risks.
“Director compensation is going up and continues to go up by 3% every year at the median, which is less than executives, high-level professional advisory services, less than inflation and really doesn’t recognize the additional time that directors themselves are putting in related to board service,” said George Paulin, partner at Meridian Compensation Partners, on a recent episode of In Today’s Boardrooms.
However, increased disclosures and shareholder scrutiny in recent years and a shifting business and economic landscape have introduced new factors to consider when determining board member compensation.
- A shift toward equity-based compensation: There’s a growing emphasis on aligning board members’ interests with shareholders through equity compensation; the better the company performs, the more the board’s equity is worth. For example, in the S&P 500, equity awards now constitute approximately 62% of total director compensation, up from 60% in previous years.
- Decline of per-meeting fees: Traditional per-meeting fees are less and less common. Only about 9% of S&P 500 companies offer them, a decrease from 12% in 2024. Companies instead favor flat annual retainers and committee-specific retainers to simplify compensation structures and reflect their ongoing responsibilities.
- Incorporation of environmental, social and governance (ESG) metrics: ESG considerations increasingly influence compensation structures. Companies are integrating ESG targets into incentive programs to promote accountability and align with broader organizational goals.
- Impact of inflation and increased workloads: Inflationary pressures and heightened responsibilities — overseeing cybersecurity and navigating geopolitical risks, for example — have led to modest increases in director compensation. “The role of a board director has gotten much more complex, much more serious; a lot has been added to the plate related to the climate, ESG, cybersecurity and lots of other things,” said Lisa Edwards, executive chair of the Diligent Institute.
- Simplification of compensation structures: Companies are moving toward streamlined compensation models, favoring fixed retainers over variable meeting fees and other benefits. This approach simplifies administration and reflects the always-on nature of modern boards.
Legal and ethical considerations for board compensation
The SEC's rule on pay-ratio disclosures
The Securities and Exchange Commission (SEC) has historically taken a recommendation-based regulatory approach to guiding companies with respect to best practices for good governance. Investors and activists have been outspoken about the large salaries that some companies pay their CEOs, boards, and other senior executives compared with the salaries that they pay other employees in the company. In response to this activism, the SEC adopted a rule on pay-ratio disclosures whereby companies must disclose the CEO's compensation and the compensation of their median employee.
IRS rules for nonprofits
While many nonprofit board members are unpaid volunteers, compensation for those who do get paid must adhere to strict IRS guidelines. Compensation must reflect the fair market value of the services, whether the board member is paid through a salary, stipend, bonus or non-cash benefits.
Exceeding the fair compensation benefit could cause the IRS to classify the compensation as an excess benefit transaction, leading to an excise tax. Nonprofits should also disclose all compensation information on their Form 990.
Conflict of interest concerns
There are also several ethical considerations regarding board member compensation, namely conflicts of interest. Board members may have a conflict if they vote on their own compensation, so boards should appoint an independent committee with no financial stake in the outcome.
Take the guesswork out of determining how much your board members make
Corporations depend on their boards to make vital decisions that impact the company’s future. Boards must have accurate, secure data to make those decisions, particularly when answering the question, “How much do board members make?”
Diligent Compensation & Governance Intelligence, part of Diligent Boards and the broader Diligent One Platform helps boards engage shareholders while staying ahead of compensation-related scrutiny. Benchmark pay-for-performance plans in line with proxy advisor Glass Lewis, build a governance structure that will hold up to activist campaigns and gain clarity on shareholder expectations.
Boards must balance paying their members well enough to attract the best talent and keep their shareholders happy. Board management software streamlines the process and supports all aspects of board work, including setting member compensation.
FAQs
Do board members get paid annually or per meeting?
Board compensation structures vary. In large public companies, board members typically receive an annual retainer, often supplemented with equity grants. Conversely, startups and smaller firms may offer per-meeting fees, especially when cash flow is limited.
How much do startup board members make?
Startup board compensation often includes:
- Equity: Between 0.25% and 1% of fully diluted shares, depending on the company’s stage and the board member’s involvement.
- Cash: Retainers ranging from $5,000 to $10,000 annually, or per-meeting fees between $1,500 and $3,000.
Can nonprofit board members receive bonuses?
Generally, nonprofit board members serve voluntarily and are not eligible for bonuses. However, if a nonprofit compensates its board members, any bonuses must be reasonable, well-documented and aligned with the organization’s mission to comply with IRS regulations.
Do board members get paid?
Yes, board members are typically compensated, especially in for-profit entities. Compensation varies based on the organization’s size, industry and governance practices. Nonprofit board members often serve without pay, though some may receive stipends or reimbursements.
How much do board members make at public companies?
In S&P 500 companies, board members earn an average of $325,000 annually, combining cash retainers and equity awards.
Are nonprofit board members paid?
While it’s legal to compensate nonprofit board members, it’s uncommon. Most serve voluntarily to uphold the organization’s mission and maintain public trust. If compensation is provided, it must be reasonable and adequately documented.
Is it legal to pay nonprofit board members?
Yes, it’s legal to compensate nonprofit board members, provided the payment is reasonable, aligns with the organization’s bylaws and complies with IRS regulations. However, many nonprofits choose not to pay board members to preserve public trust and avoid conflicts of interest.
How can I become a paid board member?
To pursue a paid board position:
- Develop expertise: Gain experience in finance, governance or industry-specific knowledge.
- Network: Connect with professionals and organizations aligned with your interests.
- Enhance your profile: Tailor your resume and online presence to highlight board-relevant skills.
- Seek opportunities: Explore board openings through executive search firms or professional associations.
How much do Boeing board members make?
Boeing board members earn an average of $345,000 annually, comprising cash payments and stock awards.
How much do Meta board members make?
Meta board members’ compensation varies. For instance, Sheryl Sandberg received approximately $4.25 million, while others like Nancy Killefer earned around $602,300, reflecting differences in roles and responsibilities.
How much do Walmart board members make?
Walmart board members receive an annual base pay of $175,000 in stock and $100,000 in cash. Additional compensation is provided for leadership roles.
Related resources
Board of directors roles and responsibilities
The roles and responsibilities of the board of directors differs based on the mission, vision, and priorities of an organization and the industry.
Executive compensation in 2025: Key trends, challenges and takeaways
Learn key strategies that compensation committees can use to address challenges and ensure shareholder alignment in 2025.
CEO compensation: Creating a strategic package to stand out in 2024 & beyond
What is CEO compensation and how can you create a package that is mutually beneficial to all parties?
