e. Compensation

Qualifiers to General Rule and Exception

Unless the bylaws provide otherwise, directors or trustees shall not receive any compensation as such, except reasonable per diems. Compensation other than per diems may also be granted by the vote of the stockholders representing at least a majority of the outstanding capital stock, or a majority of the members, at a regular or special meeting (RA 11232, Sec. 29).

However: In no case shall the total yearly compensation of directors, as such directors, exceed ten percent (10%) of the net income before income tax of the corporation during the preceding year.

Directors or trustees shall not participate in the determination of their own per diems or compensation.

Note: The implication of the phrase “as such directors” is that members of the Board may receive compensation, in addition to reasonable per diems, when they render services to the corporation in a capacity other than as directors or trustees [in this case, if serving as corporate officers] (Western Institute of Technology, Inc. v. Salas, G.R. No. 113032, 21 August 1997)¹

For Corporations vested with public interest

These corporations shall submit to their shareholders and the SEC, an annual report of the total compensation of each of their directors or trustees.

Vacancy –R.A. No. 11232, Sec. 28²

Replacement director or trustee - A director or trustee elected to fill a vacancy and shall serve only for the unexpired term of the predecessor in office.