The average fund director’s fee has dropped 16% since last year to €34,741 (£30,107) across boards in Ireland and Luxembourg, according to a study conducted by research company Fitz Partners.
The research spanned across 170 different fund promoters as part of its Directors’ Fees Report, which looked at compensation paid by funds to board members. While there was an overall decrease, the research also found vast differences between compensation from fund to fund based on the number of directors on the board and the number of products under each umbrella company.
Hugues Gillibert, CEO Fitz Partners, said: “The scale of the decrease in directors’ fees when comparing the same boards from one year to another is striking. It suggests that there is a shift in the way funds are approaching director fees. Similar to fund costs, these would be under pressure too.”
Fitz Partners found a strong positive correlation between the assets under management and the fee charged per director. There was also a link between the average fee and the number of products the fund dealt with. On the low end, funds managing under 20 products had an average total fee of around €60,000 while umbrellas with over 100 products had fees topping €300,000.
“The absence of a unique directors fee market rate illustrates the differences found in Board composition and the wide range of umbrella funds in terms of assets, number of funds or type of fund products,” Gillibert said. “It is reassuring that instead of applying one rate when it comes to directors’ fees, funds would instead set compensations on directors’ level of expertise and volume of work expected from those directors.”
Average total directors’ fees and number of products per umbrella