Paying Club Directors

Club Governance Training – Paying Club Directors

Article by Warren Tapp

I have seen a variety of remuneration arrangements for club Boards. Many pay their directors no fee at all while some pay them all and some pay the Chair and not the rest of the Board.

In my experience volunteer directors can act with a volunteer mentality. ’It is ok to miss Board meetings and or not read the Board papers, I am only a volunteer’. While a lot of volunteer directors are very good and work hard, the old saying is “you pay peanuts, and you get monkeys.”

Obviously, you have to convince the members to approve any such payments and that is not always easy. It amazes me when a club with over $30 million turnover says they cannot afford to pay their Board! This governance group is the key element in running a good club, along with the CEO. If you want good directors, then pay them for their time and personal liability they take on at law.

It also changes the relationship so that the Chair can say to a director you are being paid to do this, so do it well. It does not matter how small the amount paid is, it changes the dynamics. A survey we conducted last year shows the average directors fee is $4300pa for each director, and more for the Chair (President). I suggest you ask members at the AGM to approve a total amount and let the Board decide who should be paid what from the approved pool.  Also adjust your Board fees for CPI each year.

You might find that paying your directors will attract better skilled candidates with the right experience to nominate for your Board.

Research has shown that not for profit entities (such as clubs) that pay their directors always perform better than those that do not.

There is training on topics like this in our online learning platform at https://clubgovernance.com.au/elearning-platform to assist you and your Board.