Top Five Trends in Board Leadership and Pay at Public Companies

Published: September 2020


Board leadership structures and compensation can vary greatly depending on company size. Our research reveals key data, such as trends in stock ownership guidelines, types of perks that are declining and differences in how pay is structured for CEOs and executive chairs.

The leadership structure and compensation for public company boards has come under greater scrutiny in recent years from institutional investors and proxy advisory firms. Using data from Aon’s Compensation & Governance Professional (CG Pro) suite of tools, we took a close look at trends in how much directors are being paid, how their pay is designed and the types of leadership structures that are most common. For our research, we analyzed pay at companies in the S&P 500, S&P Midcap 400 and S&P Smallcap 600 indices.

The report provides prevalence information and comparisons amongst the different board leadership positions for the following areas:

  • Prevalence of the various board leadership roles
  • Pay differences between the roles
  • Pay mix and equity vehicle mix
  • Perquisites
  • Stock ownership guidelines and holding requirements

Here are top five key takeaways from our report:

#1. Pay for executive chairs at larger organizations tends to be higher than that of the CEO in his/her first year on the job.

However, the difference in pay is minimal: The median total compensation of the executive chair and new CEO are within 1% of each other among the S&P 500 boards. The same, however, is not true for smaller organizations where executive chairs tend to be paid slightly less than the CEO with a median pay gap of around 15%.


#2: Compensation design is similar for a combined CEO and chair or a separate CEO with an executive chair.

At all organizations, the mix of pay remains similar as an executive moves from the role of CEO to executive chair. However, at smaller organizations, the new CEO has slightly more emphasis placed on long-term incentive compensation than the executive chair receives.


#3. Larger companies are more likely to have a lead director, while non-executive chairs are more common at smaller firms.

Just over half of S&P 500 boards have a lead director and no independent board chair. The reverse is true for smaller organizations, with more companies tending to have an independent chair of the board without a lead director. Only 15% of all companies have both a lead director and non-executive chair of the board. 


#4. Perquisites offered to the executive chair tend to be consistent with those they received as CEO.

Although perquisites are decreasing in prevalence overall, companies still offer select perks to CEOs and executive chairs to assist with certain administrative and personal responsibilities. Interestingly, executive chairs are more likely to receive travel-related perks compared to incoming CEOs, suggesting that these types of perks are being phased out.

#5. Companies are more likely to have stock ownership and holding requirements for the CEO than the executive chairman.

Depending on the size of the organization, about half to two-thirds of CEOs are subject to both a stock ownership and a holding requirement, and about one-quarter are subject to holding requirements only. Between 25% to 35% of executive chairs have no ownership guidelines or holding requirements. That’s only the case for 10% to 20% of CEOs.


For questions about the findings in our report or to purchase a copy, please write to

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