Serving as a board member of insurance and financial services company Principal Financial Group Inc. has become more lucrative.
The Des Moines-based company announced this week that it has increased the annual retainer it will pay directors who are not employed by the company to $60,000 a year. Currently, directors are paid $45,000 annually.
Board members who also serve as chairman of the audit committee get an additional $15,000 and those heading the human resources or nominating and governance committees get $10,000 more. Other committee heads and the presiding director are given an additional $5,000.
The director’s stock plan was also improved.
Beginning May 2007, each non-employee director will be given $85,000 worth of restricted stock units, an increase from the current $75,000 amount. The stock vests upon the director’s continued service to the next annual meeting.
The receipt of the restricted stock units will be deferred until the director’s retirement or termination from the board.
The Principal board also adopted stock ownership guidelines for non-employee directors, who are now expected to own the company’s common stock, restricted stock units and phantom stock units acquired through the company’s deferred compensation plan with a value equal to or greater than five times the value the director’s annual retainer. The directors are to achieve the new ownership guidelines within five years of adoption.
The board said that Principal Life will match charitable gifts of non-employee directors to the United Way up to $10,000 a year for each director during a director’s term and for each of the three years following the director’s retirement from the board.
The new program is in addition to a program that matches charitable donations to nonprofit organizations up to $6,000 per director per year.
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