RESEARCH REPORT ON BOARD DIRECTORS’

REMUNERATION ON WORKING ON BOARD

COMMITTEES

A RESEARCH REPORT
Presented
By

CITY SECRETARIES LIMITED

 Table of Contents

Contents Page(s)

Executive Summary 2

Background 5

Results & Findings 6

Conclusion 9

Research Report on Directors’ Remuneration for Working on Board Committees Page 2

 Executive Summary
The role and performance of Directors on Board Committees cannot be
overemphasized and to appreciate these efforts it is important that
they be adequately rewarded.

The different committees existing on boards of companies vary and

some are as listed below:

1. Finance Committee
2. Audit & Risk
3. Strategy and Corporate Governance

Some of the committees have members based on the total number of

directors on the board. Some committees have members between 2
and 4 to help in overseeing the activities of the Company in conjunction
with the management.

The objective of this study is to find out the remuneration for directors
of companies operating in Nigeria with the aim of using the findings as
a guide in arriving at the best compensation for directors of Hillcrest
Agro-Allied Industries Limited (HAAIL) working on different committees
of the Company.

To achieve the objective of this study, simple random sampling method

was employed in the selection of the companies. Furthermore,
qualitative research method was employed which involved using
Extended Depth Interviews (EDIs) by using structured questionnaire in
interviewing principals of the companies selected.

The companies operate in different sectors of the Nigerian economy.

The sectors are as follows: Building & Construction, Insurance, General

Research Report on Directors’ Remuneration for Working on Board Committees Page 3

Investment, Operators in the Capital Market and Publishing. The
remuneration paid per annum over a period of five (5) years ranging
from 2017 – 2022 was reviewed.

The results revealed that the manufacturing/production companies pay

higher remuneration than companies in other sectors despite the harsh
economic climate. The principals interviewed confirmed that the
directors have to work extra hard by bringing their industry experience
to bear in the smooth running of the respective organizations.

80% of the principals interviewed confirmed that the fees paid to

directors for the years under review is sometimes dependent on the
operating results for that year. This thus means that even an amount is
fixed to be paid, the amount might be higher or lower depending on
the operating results.

In conclusion, the amount paid to the directors is dependent on the

operating results per year.

Research Report on Directors’ Remuneration for Working on Board Committees Page 4

 Background
The role and performance of Directors on Board Committees cannot be
overemphasized and to appreciate these efforts it is important that
they be adequately rewarded.

The different committees existing on boards of companies vary and

some are as listed below:

1. Finance Committee
2. Audit & Risk
3. Strategy and Corporate Governance

Some of the committees have members based on the total number of

directors on the board. Some committees have members between 2
and 4 to help in overseeing the activities of the Company in conjunction
with the management.

The objective of this study is to find out the remuneration for directors
of companies operating in Nigeria with the aim of using the findings as
a guide in arriving at the best compensation for directors of Hillcrest
Agro-Allied Industries Limited (HAAIL) working on different committees
of the Company.

Research Report on Directors’ Remuneration for Working on Board Committees Page 5

 Methodology
To achieve the objective of this study, simple random sampling method
was employed in the selection of the companies. Furthermore,
qualitative research method was used which involved using Extended
Depth Interviews (EDIs) by using structured questionnaire in
interviewing principals of the companies selected.

The companies operate in different sectors of the Nigerian economy.

The sectors are as follows: Building & Construction, Insurance, General
Investment, Operators in the Capital Market and Publishing. The
remuneration paid per annum over a period of five (5) years ranging
from 2017 – 2022 was reviewed.

Research Report on Directors’ Remuneration for Working on Board Committees Page 6

 Results & Findings
The results confirmed that 70-80% of the respondents pay between
N100,000 – N150,000 to the directors working on committees.

For the period under review, the respondents have gradually increased
the remuneration paid to the directors which is as a result of the
operational activities of the companies.

Below is a summary of the different amounts paid to the directors by

the different companies for the period under review i.e. 2017 – 2022.

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 SUMMARY OF RESEARCH FINDINGS
s/n Company Sector 2018 2019 2020 2021 2022

1. Palmyra
Construction Building & 65,000 80,000 N/A 100,000 100,000
(Company) Limited Construction

2 Man-Mountain
Insurance Brokers Insurance 50,000 50,000 N/A 65,000 80,000
Ltd
3 Heritage Capital
Markets Limited Capital Market 100,000 100,000 100,000 120,000 120,000

4 Dominion Finance
Limited General 75,000 100,000 N/A 120,000 150,000
Investment
5 C A Consultants
Limited Construction 80,000 100,000 120,000 150,000 180,000

6 Investments
(1971) Limited General 100,000 100,000 N/A 120,000 150,000
Investment
7 CSS Bookshops
Limited Publishing 120,000 120,000 80,000 150,000 150,000

8 Dane Investments
Ltd General 150,000 150,000 150,000 200,000 250,000
Investment
9 Life Press Limited
Publishing 75,000 100,000 N/A 100,000 120,000
10 Mutual Alliance &
Investments Capital 50,000 75,000 N/A 75,000 100,000
Securities Limited Market

*Fees collected per annum by Directors working on Committees on their respective Boards per
annum.

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 Conclusion
The results confirmed that payment paid to directors is dependent on
the operating results of the company in question.

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