Who should determine the remuneration of non-executive directors?

The determination of remuneration for non-executive directors is primarily the responsibility of the board of directors. This is because the board is positioned to ensure that the compensation packages offered align with the company's overall strategy and objectives, as well as reflect the contributions of the non-executive directors in providing oversight and guidance without getting involved in the day-to-day management of the company.

The board is tasked with balancing the need to attract and retain talented non-executive members while also ensuring that remuneration is set at a level that is fair and justifiable, particularly in light of the company's performance and the interests of stakeholders. They have the insight to evaluate how the non-executive directors contribute to corporate governance and oversight, which informs their remuneration decisions.

While other options include shareholders, an independent committee outside the board, and the management team, these alternatives can lack the necessary oversight and understanding of the broader corporate strategy that the board of directors possesses. This structure helps maintain a level of integrity and objectivity regarding the remuneration process, supporting good governance practices.