Board member remuneration varied significantly between Canadian and U.S. companies. The Entrepreneurial Boards Composition and Compensation Survey: The Canada Report divided remuneration into four basic categories: Cash Only; Cash and Equity; Equity Only; No Cash, No Equity. (See Figure 6.1)
Canadian companies are more generous to their board members than their U.S. counterparts. The cash-only compensation is the only similar number between our Canadian and U.S. samples. Cash-only remuneration is given in 11% of Canadian companies and 13% of U.S. companies.
45% of Canadian companies offer both cash and equity versus 24% of US companies. At the other end of the spectrum, 14% of Canadian companies and 24% of US companies pay no compensation to board members. Overall, Canadian companies are more generous to their board members.
It is unclear why this is. Perhaps it is due to the size of the Canadian market and the perception of the difficulty of obtaining outstanding board members. The Canadian entrepreneurial ecosystem is still forming and the number of successful entrepreneurs that have been through several companies is not as large. Also, many other independents need to be brought up from the United States, and perhaps there is a perception that more compensation needs to be given for this to be realized.
Figure 6.1: Board Member Remuneration - Canadian vs. U.S. Companies