2010 Could Be Big for Compensation Consulting Firms

The world of compensation consulting is getting infinitely more complicated, with new SEC requirements for board compensation consultant disclosure sending many companies in search of advice on how to stay compliant with the rules. Should these trends hold, 2010 could be a very good year for those in the business of compensation consulting.

Equilar\’s Consultant League Table, released yesterday, has some fascinating facts and figures about compensation consultant market share. As expected, the newly merged mega-firm Towers Watson (formerly Towers Perrin and Watson Wyatt) leads the pack in almost every major index, with 22.3% market share in the Russell 3000 and 26.8% in the Fortune 1000, in addition to dominant market share with all sizes of companies in the S&P 1500. They\’re also at the top in all four regions of the U.S.

But big firms aren\’t the only winners in the new climate; a few boutique shops have carved out niches in the data. Examples include Steven Hall & Partners and James F. Reda & Associates, which have built a strong client base in the consumer goods industry, and Amalfi Consulting, which is particularly strong in the South. We\’ll be interested to see if board independence requirements push these small firms even higher.

The report isn\’t available to the general public, but you can request a copy at Equilar\’s website.