At a time when more and more companies are moving to stock-based compensation for their boards of directors, small to midsize public companies grant more than twice as many stock options as large public companies. That is one of the key findings of a study conducted jointly by The Segal Company, a leading employee benefits, compensation, and actuarial consulting firm, and Grant Thornton LLP. The study of public company boards found significant differences in small to midsize and large companies, both in the precise role they play in corporate governance and in the compensation they receive.

According to the study, small to midsize companies grant directors a median of 2,500 onetime stock options, two and a half times as many as are granted by their large company counterparts. Similarly, small to midsize companies offer current-year stock options of 1,000 shares to directors, on average, which is more than twice the average of options on 450 shares granted to large company directors. This would indicate that smaller public companies are leading the way in linking board members' pay to company performance.

Other study findings include the following:

* Small to midsize company directors have a greater stake in the ownership of the companies they serve, with half (50%) owning company stock, than directors at large companies, of whom 8% own company stock.

* Large companies pay directors a median retainer of $30,000 per year, six times the $5,000 median annual retainer at small to midsize firms

* For each board meeting, the median compensation for large company directors is $1,000, compared to $600 at small to midsize companies.

* Directors of large companies tend to be older than those at small to midsize companies: half are 60 to 69 years old, while less than one-quarter (24%) of small to midsize company directors are in this age category.

* Large companies average 13 board members, while small to midsize companies average only seven.

* Large companies are more likely to include women on their boards, with 13% having women directors compared to 4% of small to midsize companies.

* Large companies have a median of five standing committees while small to midsize companies have only two. Finance, public/legal affairs, benefits, and human resources are among the most prevalent committees at large companies--none of the smaller companies studied had such committees

The study looked at 179 large public companies with median sales of $12 billion, median net earnings of $640 million, and a median return on shareholder equity of 9.9%. Of these companies, 173 are listed on the New York Stock Exchange.

Small to midsize companies were represented by 199 firms with median annual sales of $107 million, median net earnings of $9 million, and a median return on shareholder equity of 16.3%. Sales for the latest year were between $5 million and $350 million. These companies have a five-year, annual average growth rate on sales of eight percent or more, with an average annual return on equity for the last five years of at least 9.5%. Of the 199 small to midsize companies surveyed, 151 list their shares on the NASDAQ Stock Market.

For a copy of the complete survey report contact Mary L. Feldman, Vice President, Public Affairs, The Segal Company, One Park Avenue, New York NY 10016. (212) 251-5029. *