Welcome to the NED Capital Podcast, where we explore the issues that matter to chairs, CEOs, investors and business owners when building effective boards.Today, we're looking at one of the most practical questions surrounding Non-Executive Director appointments:How much should a NED actually be paid?NED remuneration can be surprisingly difficult to benchmark.Unlike executive salaries, there isn't a single straightforward salary scale that applies across every Non-Executive Director role. Fees can vary considerably depending on the size of the organisation, sector, complexity, risk, board responsibilities and the experience required from the individual.That's why getting the fee structure right is an important part of the recruitment process.We've produced a detailed NED Salary Guide to help businesses understand the market and benchmark appropriate remuneration for different types of Non-Executive Director appointment.But before deciding on a figure, it's important to understand what you're actually paying for.A NED isn't being employed to work a conventional five-day week.Their value comes from experience, judgement, independence and the ability to challenge management constructively.A highly experienced NED may only spend a limited number of days formally attending board meetings, but their contribution can extend considerably beyond those meetings.They may review board papers, speak with the chair or CEO, participate in strategy discussions, attend committee meetings, advise on acquisitions or financing, and make themselves available when an important issue arises.Consequently, looking purely at the number of days worked can give a misleading impression of the appropriate fee.The first factor to consider is the size and complexity of the organisation.A small private company with a relatively straightforward business model will normally have very different NED requirements from a large, regulated or internationally operating organisation.The second factor is the level of responsibility.Is the NED simply attending quarterly board meetings, or will they chair an important committee?Will they be expected to provide additional strategic input?Are they likely to become involved in fundraising, acquisitions, restructuring or succession planning?The more responsibility attached to the position, the more carefully remuneration needs to be considered.Sector is another important factor.Certain industries require specialist knowledge, and the pool of people with that experience may be relatively small.Financial services, healthcare, technology, private equity and regulated businesses can all require particularly specific NED expertise.In those situations, attempting to minimise the fee can actually make recruitment more difficult.The strongest candidates may simply have better opportunities elsewhere.There is also an important distinction between the headline annual fee and the total remuneration package.Our guide to How Non-Executive Director Fees Are Typically Structured looks at this in more detail.Typically, remuneration can involve a basic annual board fee, with additional payments depending on responsibilities.For example, the chair will normally command a higher fee than an ordinary NED because of the additional responsibility involved.There may also be additional fees for committee chairs or particularly demanding assignments.And then there is the question of expenses.Travel, accommodation and other legitimate expenses may be reimbursed separately rather than being incorporated into the NED's annual fee.