Reuters reports the Corporate Library, a governance research group, looked at a sample of 215 CEOs whose companies reported perk packages of more than $500,000 in annual proxy statements filed between March and July and found 54% of the CEOs had access to corporate aircraft last year for non-business use. New rules for disclosure of executive pay packages put forth by the Securities and Exchange Commission in 2005 went into effect in December 2006 (See New Executive Compensation Disclosure Rules Take Effect ).
The study found costs of the perk vary widely, with a median annual cost to companies of $182,929, according to Reuters. Study author Paul Hodgson, a senior research associate at the Corporate Library said that while “a few companies require some level of reimbursement from executives for this benefit, most do not.”
The biggest costs reported for the perk last year, according to the study, was by Atlanta-based financial services company CompuCredit Corp., which recognized costs of $1,004,900 for personal air travel for CEO David Hanna. That was followed by i2 Technologies Inc. which recognized $942,565 in costs last year for jet use by Michael McGrath, who stepped down as CEO in July, and by EchoStar Communications Corp., which recognized $821,771 in costs for plane usage by CEO Charles Ergen.
In addition, 21 of the CEOs in the study were reimbursed by their companies to offset the tax consequences of personal flights, which tax authorities consider income. The biggest tax reimbursement went to Meg Whitman, the CEO of eBay Inc., who got $230,992 in tax reimbursement after generating $773,467 in aircraft costs.
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