The pay gap between men and women who are non-executive directors is closing.
The Institute of Directors 2016 Directors' Fees Report, released today, shows the median fee for male non-executive directors has dropped to $44,000, down from $45,000 last year, while the median fee for women has increased from $37,000 to $39,800. The institute recorded the overall median fee for non-executive directors was up to $42,994 from $41,610 last year.
Institute chief executive Simon Arcus said the rise was "modest" at 3 per cent. In comparison, the growth from 2014 to 2015 was 4 per cent.
Arcus said it was "really good news" to see the pay gap between male and female directors narrowing.
"It's narrowed by 10 per cent, but it's still in could-do-better territory."
The survey said 28 per cent of boards evaluated the fees of directors annually, and Arcus said this needed to improve. "If you're going to accept that directors should be well remunerated then you need to demonstrate quality.
That means good board evaluation, excellent annual reports, good transparency, stakeholder relationships," he said.
Una Diver, partner at EY who assisted with the survey, said boards were critically evaluating their performance "more often and more rigorously" than ever. But evaluation of fees was not happening evenly.
"Our view is that that is probably more common in large listed entities than the smaller entities," Diver said.
Arcus said there'd been a "levelling off" in the increase in fees at a time when the role of governance required more time and expertise.
Diver said particularly with the digital transformation underway in many organisations, boards wanted people with expertise in technology.
"Boards are actively seeking somebody who understands all three: technology, risk and governance, and they are hard to find."
Survey data showed 58 per cent were satisfied with their pay, compared with 50.6 per cent in 2015.
Arcus said: "New Zealand needs directors who are courageous but for whom the risk and reward balance in remuneration makes sense."