Non-executive directors play an essential role in guiding companies, bringing their expertise and fresh perspectives to the boardroom to help companies strengthen governance, mitigate risks, and enhance decision-making.

As with all leadership roles, when the issue of remuneration comes up, pay can differ significantly depending on the industry, the type of company, and how complex the organisation is.

For organisations aiming to attract top-tier talent and individuals contemplating boardroom appointments, understanding the remuneration range for non-executive director roles will help you navigate negotiations and set realistic expectations.

While precise figures vary depending on factors like organisation size, regulatory requirements, and location, the following estimates provide a general overview for each sector:

Financial services: Within the financial services sector, where complexity and regulations are the norm, a non-executive director’s pay packet gets shaped by a mix of the company’s size, its track record, and the distinct roles they tackle on the board. This means compensation can really vary, stretching from £40k to more than £200k annually, mirroring the significant contributions someone makes.

Public companies: At publicly traded companies, non-executive directors can expect a package that mixes yearly retainers with extra pay for joining committees and showing up at meetings. The total take-home can swing from £40k to more than £160k. It’s a setup that pulls in the best of the best, offering pay that matches the skill set needed to juggle the complex world of being in the public eye and sticking to the rules.

Private firms and VCs: In the world of private firms and venture capital-backed start-ups, how non-executive directors get paid can really vary. You might see a blend of cash and stock options, especially if the company’s just starting out or growing quickly. It’s all about tying a director’s rewards to how well the company does, motivating them to help the business thrive and hit those big goals. Depending on where the company is at and its potential, a non-executive director’s pay could range from £20k to £120k, or even more.

State sector: In the state sector, salaries are usually set by government rules, showing just how accountable these organisations are and their clear-cut missions. Even though the pay might not be as high as in the private sector, working in these roles brings a special chance to really make a difference in public service and governance. Dictated by official guidelines, annual earnings could be anywhere from £8k to £60k, based on how big the organisation is, its purpose, and how it’s put together.

Charity and not-for-profit: These organisations typically offer minimal or no compensation to their non-executive directors, highlighting the volunteer spirit and commitment to making a difference in areas such as social work, education, or charity. Even though these roles might not boost your bank account, with financial compensation often sitting between zero and £16k, they’re rich in personal and professional satisfaction, giving directors a chance to leave a lasting mark on society.

When considering a role as a non-executive director, it’s important to balance the financial perks with how closely the organisation’s mission and values resonate with your own career aspirations and ethics. Of course the pay matters, but it’s the bigger picture—making a meaningful contribution to a board committed to driving positive change and adding value—that really counts.

Further resources

UK Board Remuneration Handbook 2023, Mercer
Non-Executive Director Remuneration in Europe 2023, ecoDa
The non-executive director role, CIPD
How to become a non-executive director, Institute of Directors
Stepping up: A guide to getting your first non-executive director role, Odgers Berndtson
First time guide for non-executive directors, Sam Allen Associates
Becoming a non-executive director, Spencer Stuart

Visit Board Agenda’s Corporate & Advisory Services directory for details of non-executive director executive search and selection companies.