The Cost of Hiring a NED — and Why It Pays Off

Introduction: Cost Versus Value

For many boards, especially in growth companies or investor-backed businesses, the first question in a NED search is simple: what will it cost?

While remuneration is an important consideration, it should never be the only one. The appointment of a strong NED is an investment, not an expense — one that can deliver outsized returns through improved governance, investor confidence and better strategic decisions.

Typical NED Costs in 2026

The cost of a NED appointment varies widely, but common benchmarks include:

• UK Main Market Listed Companies: £60,000–£120,000 per year (committee chairs often higher).

• Private Companies / Scale-Ups: £20,000–£50,000 per year, depending on size and complexity.

• Infrastructure and Capital-Intensive Sectors: Often at the higher end due to complexity and regulatory exposure.

• Fractional or Interim NEDs: Flexible retainers from £2,000–£5,000 per month, depending on scope.

These figures typically include attendance at 6–10 board meetings per year, plus committee work. Time commitments may range from 15–40 days annually.

Factors That Influence NED Remuneration

1. Sector Complexity – Boards in telecoms, infrastructure and financial services pay more due to regulatory and strategic exposure.

2. Company Size and Market – Listed companies attract higher fees than private firms.

3. Committee Responsibilities – Chairs of audit, remuneration or risk committees earn premiums.

4. Geography – European NED fees can be lower than UK equivalents; US roles often higher.

5. Time Commitment – Fractional, interim or advisory-style NED roles are priced differently from permanent appointments.

Why the Cost Is Justified

Boards should view NED remuneration in the context of the value created:

• Investor Confidence – The presence of respected NEDs signals strong governance, often supporting valuations.

• Strategic Insight – Experienced NEDs help boards make better decisions on capital allocation, technology adoption and risk.

• Resilience – In crises, a strong NED can strengthen board responses and stakeholder communication.

• Regulatory Standing – Regulators are reassured by credible independent oversight.

The ROI of a strong NED appointment often exceeds the cost many times over, particularly when avoiding a failed investment or governance misstep.

The Risk of Undervaluing the Role

Some boards attempt to economise on NED appointments, offering below-market remuneration or seeking candidates willing to serve primarily for prestige. This creates three risks:

1. Limited Candidate Pool – Strong candidates may not consider the role.

2. Lower Engagement – Underpaid NEDs may prioritise better-remunerated roles.

3. Investor Perception – Investors may question whether governance is being taken seriously.

Boards should align remuneration with both sector benchmarks and the strategic importance of the role.

Cost Transparency With Investors

Increasingly, investors want clarity not only on executive pay but also on NED remuneration. Boards that explain the rationale for fees — based on sector complexity, committee responsibilities and value delivered — build confidence with shareholders.

So What for Boards?

The cost of hiring a NED should be considered against the risks of not having the right governance in place. For companies in telecoms, infrastructure and technology, where regulatory scrutiny and capital intensity are high, the absence of specialist NED oversight can be far more costly than any remuneration package.

Board Conclusion

Hiring a NED comes with a price tag, but it is best understood as an investment in governance, strategy and resilience.

Boards should be prepared to pay for quality — particularly for NEDs who bring:

• Sector-specific insight.

• Committee leadership.

• Investor credibility.

• Strategic foresight.

The boards that do so position themselves for stronger long-term performance and market confidence.

Bridge Connect advises boards on the value and structure of NED appointments, ensuring remuneration aligns with market benchmarks and strategic needs. With extensive experience across telecoms, infrastructure and technology, we support boards in making the right investment in their governance.

If your board is considering a NED appointment, contact Bridge Connect for a confidential discussion on cost, value and strategic return.