2021 Inside the Private Company Boardroom
The Shape of Private Company Governance
Privately held companies are a massively important part of the economic landscape. Yet, relative to their public company peers, the directors and governance professionals that serve these organizations have few data sources to consult regarding private company board compensation and composition practices. The 2021 Inside the Private Company Boardroom report aims to fill this void, providing private company data addressing the structure of the board, as well as its director compensation practices.
- Board Committees: Private company boards increasingly adopt committee structures typical of public company boards. This includes the audit committee (from 79% to 88% adoption), the compensation committee (77% to 83%), and the nominating/governance committee (56% to 62%).
- Private Company Board Composition: Thirty-seven percent of respondents indicated that they have recently appointed a board candidate from an underrepresented group, up from 31 percent in 2020.
- Independent Director Compensation: Over the last year, the average retainer for an independent director increased by 1.3 percent, to $56,928.
- Family owned boards: In addition to the statutory board, nearly half (49%) of family business boards indicate that their organization has a process or structure in place to manage conflicts/concerns among family members.
About NACD's Inside the Private Company Boardroom report:
Data presented in Inside the Private Company Boardroom was collected in a survey of NACD members serving on boards of for-profit, privately held companies. It was in the field from late May to early June of 2021, and the data collected was analyzed to create a snapshot of the structure, composition, and compensation practices of these boards.