This post is part of an ongoing series that examines the way stock exchange independence rules relate to director compensation.  We are for the most part including companies from 2011’s Fortune 500 and using information found in their 2011 proxy statements.

Nasdaq and the NYSE have similar rules with respect to director independence.  NYSE Rule 303A.01 requires that each listed company’s board of directors be comprised of a majority of independent directors.  A director does not qualify as “independent” if he or she has a “material relationship with the company.”  NYSE Rule 303A.02(a).  In addition, the director is not considered independent under NYSE Rule 303A.02(b)(ii) if the director received more than $120,000 in direct compensation, other than director’s fees, during any of the previous three years.  NYSE Rule 303A.06 imposes a higher independence standard for directors serving on the company’s audit committee by requiring them to comport with Rule 10A-3 (C.F.R. §240.10A-3).

Independent directors are compensated for their service on the board.  The amount of compensation can be seen from examining the director compensation table from The Walt Disney Company (NYSE: DIS) 2011 proxy statement.  According to the proxy statement, the company paid the directors the following amounts:

*At Mr. Jobs’s request, he received no compensation for his services as a director. Mr. Jobs passed away on October 5, 2011.

Director Compensation. Effective October 1, 2011, the board increased the annual board retainer from $80,000 to $100,000, increased the annual deferred stock unit grant from $140,000 to $150,000, and increased the annual committee retainer for the Audit Committee chair from $15,000 to $20,000. The annual retainer for committee membership remained at an additional $10,000 paid to each director. The retainer for committee chairs remained at an additional $15,000. The annual retainer for the Chairman of the Board, Mr. Pepper, was $500,000 for the 2011 fiscal year. The board met five times during the 2011 fiscal year. Every current director attended at least 75% of the board meetings, the committee meetings on which he or she served, and the company’s 2011 annual shareholders’ meeting. To encourage the directors to personally experience the company’s products, services, and entertainment, Walt Disney allowed each non-employee director up to $15,000 per year at the company’s resorts, cruises, and stores. The company also allowed family members, including spouses, children, and grandchildren, to participate and reimbursed their travel expenses.

Director Tenure.  On January 1, 2007, Mr. Pepper became the Non-Executive Chairman of the Board. Mr. Pepper has notified the board that he plans to retire at the 2012 annual shareholder meeting. The board concluded that it will extend Mr. Robert Iger’s CEO employment contract and name him Chairman of the Board upon Mr. Pepper’s retirement. Mr. Jobs passed away on October 5, 2011, and Mr. Bryson resigned from the board on October 21, 2011.

Executive Compensation.  In 2011, Mr. Iger, CEO, received fixed compensation of $2,962,932, a performance-based bonus of $15,500,000, and an annual equity award of $12,900,081. Mr. Iger’s total compensation was $31,363,013. Mr. Iger also received $371,439 in personal air travel and $561,303 for security. James A. Rasulo, CFO, received fixed compensation of $1,457,743, a performance-based bonus of $3,750,000, and an equity award of $4,676,340. Mr. Rasulo’s total compensation was $9,884,083. All executives were entitled to the option of a company-supplied automobile or a monthly payment; health club membership; free access to company theme parks, some resort facilities, and discounts on merchandise; and personal use of tickets that were acquired for business entertainment when no business use had been arranged.