Eight Outrageous CEO Perks

Print Email

1. Private Use of Corporate Aircraft
>2011 value: $913,966
>Chairman: Barry Diller
>Company: IAC/InterActiveCorp. (NASDAQ: IACI)

Barry Diller has been a senior executive in the entertainment industry for decades. Diller ran Paramount in the 1970s and 20th Century Fox in the 1980s. He is credited with starting the Fox Television Network. Diller is currently one of the wealthiest media Executives in the country. At 70, he is listed on the Forbes 400 with a net worth of $1.8 billion. IACI owns Ask.com, The Daily Beast, and CitySearch. The IACI proxy states: “Diller is required to travel, both for business and personal purposes, on corporate aircraft. In addition to serving general security interests, this means of travel permits him to travel non-stop and without delay, to remain in contact with the Company while he is traveling, to change his plans quickly in the event Company business requires, and to conduct confidential Company business while flying, be it telephonically, by email or in person.”

Also Read: The Cities Where Everyone Has a Job

2. Security
>2011 value: $2,611,873
>CEO: Sheldon Adelson
>Company: Las Vegas Sands (NYSE: LVS)

Adelson became famous to the general public recently when he invested tens of millions of dollars into the campaigns of several presidential candidates. He helped keep Newt Gingrich financially alive in the Republican primaries, and funneled $95 million to the Republican party both directly and through PACs. Adelson is among the most wealthy people in America with a net worth of $20.5 billion, which puts him at the No. 12 position on the Forbes 400. The source of the 79-year-old’s wealth goes well beyond his compensation. According to the proxy, Adelson and his wife, Miriam Adelson, own roughly 52.4% of outstanding common shares of the company, either directly, or through trusts and other entities. Adelson has run the company since he started it in 1988. The Las Vegas Sands proxy also notes that the company provided security for Adelson and his family, with the full fiscal year 2011 bill coming to $2,611,873. Adelson also has extensive access to company-paid private air travel. Another famous billionaire executive whose company pays an extraordinary amount for security is Jeff Bezos. The founder of Amazon has a net worth of $23.2 billion.  Bezos’ security costs were an extraordinary $1.6 million last year.

3. Signing Bonus
>2011 value: $53 million
>CEO: Ron Johnson
>Company: J.C. Penney (NYSE: JCP)

One of the most visible failed CEO appointments of recent years is that of former Apple retail chief, Ron Johnson, to run troubled retailer J.C. Penney. According to a J.C. Penney proxy, Johnson was granted $53 million in company stock as part of his initial compensation package. But the hopes Johnson would turn things around at the retailer quickly faded. Since he assumed the position on November 1, 2011, J.C. Penney shares have fallen roughly 40%. The company’s fortunes have deteriorated substantially since Johnson joined. In the most recent quarter Penney reported that same-store sales for Q3 2011 fell by 26.1%, while total sales fell by 26.6%. Sales through JCP.com were just $214 that quarter, down 37.3% from the same period last year.

 4. Use of Car and Driver
>2011 value: $572,596
>CEO: Ralph Lauren
>Company: Ralph Lauren (NYSE: RL)

Ralph Lauren, who founded his empire in 1967, remains CEO of his company to this day. Holding a large amount of stock, the 73-year-old fashion great has become immensely wealthy with a net worth of $6.5 billion. He has control over the company through the ownership of 69.1% of the voting shares. Lauren gets a large sum for his car and driver, along with other lavish benefits. The company’s proxy says: “We believe that these benefits generally allow our executives to work more efficiently, promote our brand and are legitimate business expenses. The costs of these benefits constitute only a small percentage of each NEO’s total compensation.”