SINGAPORE: Non-executive directors (NEDs) in Singapore receive the second-highest pay among their peers in four ASEAN countries, namely, Singapore, Malaysia, Indonesia and Thailand.
This according to a report released by Hay Group, the global management consultancy.
The report is based on an analysis on data collected from 200 large companies in the four ASEAN countries from 2008 to 2010.
According
to the report, at the median level, NEDs from large companies in
Singapore received a remuneration of S$95,000 in 2010. Indonesian NEDs
took the top spot at S$239,000 while NEDs in Thailand and Malaysia
received S$59,000 and S$58,500 respectively.
The Hay Group report also shows that the remuneration for NEDs climbed steadily over the three years.
Singapore
NEDs saw a pay increase of 9 per cent in 2009 and 2010. In Malaysia,
the increase was 17 per cent in 2009 and 3 per cent in 2010. Indonesian
NEDs observed an increase of 13 per cent in 2009 and 10 per cent in 2010
and in Thailand, the increase remained steady at 14 per cent in 2009
and 2010.
The top three sectors in Singapore for median average
NED remuneration are banks (S$152,000), followed by food (S$113,500) and
transportation (S$110,000). Banks in Malaysia, Indonesia and Thailand
also offer the highest pay to NEDs compared to other industries.
The
Hay Group report shows that the remuneration for NEDs in Singapore's
large companies is mainly composed of directors' fees (92 per cent) and
share-based compensation (8 per cent). In contrast, benefits and
perquisites are widely used for NED remuneration in Malaysia, Indonesia
and Thailand.
Benefits-in-kind in Malaysia account for a
significant portion (30 per cent) of total remuneration for NEDs. These
benefits-in-kind include social allowance, car allowance, reimbursement,
retirement gratuity and others. NEDs in Indonesia and Thailand receive
bonuses which form a large portion of their total remuneration, with 52
per cent in Indonesia and 33 per cent in Thailand.
Share-based
compensation was not commonly used for NED remuneration among the four
countries. In Singapore, 10 out of the top 50 companies offer stock
option plans for NEDs and 13 companies offer full-value share plans for
NEDs. Even fewer companies (less than 10 per cent) in the other three
countries do likewise.
Gender diversity in board leadership
remained low, with the majority of the large listed companies in the
four countries lacking female NEDs on their boards during 2008 to 2010.
In
Singapore, the percentage of companies with one or more female NEDs on
their boards remained largely unchanged at around 45 per cent. The
prevalence of female NEDs in Indonesia (around 30 per cent) is the
lowest among the four countries. In contrast, companies in Malaysia and
Thailand are making greater progress and more than half of the companies
have female NEDs on their boards in 2010.
The Hay Group report
shows that, as at the end of 2011, the median tenure of independent
directors is seven years in Singapore, six years in Malaysia, 4.5 years
in Indonesia, and three years in Thailand.
- CNA/cc