Business leaders are increasingly using corporate jets for personal use, according to a report from executive intelligence firm Equilar.
Equilar’s report, which was initially released over the summer, examined corporate perks for chief executive officers (CEOs) and chief financial officers (CFOs) by analyzing the proxy statements filed with regulators by the 500 largest publicly traded U.S. companies by revenue. Among the common perks available are the use of the company aircraft, a company car and driver, as well as security services.
The report noted that in terms of aircraft perks provided to executives, the median value of those perks rose to $130.1 million for CEOs and $23.3 million for CFOs in 2022 – an increase of $30.1 million and $700,000 from 2021, respectively.
Those figures had fallen to $80.1 million for CEOs and $22.1 million for CFOs in 2020 due to the pandemic after being around $102 million for CEOs and $16 million for CFOs in the two years before the pandemic.
“There’s a bit of a jump, about a 30% increase in the actual value of perks awarded to CEOs,” Amit Batish, senior director of content and communications for Equilar, told FOX Business. “I would say that was a notable increase during the start of the pandemic in 2020, there’s a nice little bump there from 2020 to 2022.”
“A lot of that could be obviously attributed to rising fuel costs, supply chain demand and whatnot… You did see a lot of CEOs get awarded these perks for safety purposes as well in terms of traveling. That’s often something that’s disclosed at these companies,” he added.
Equilar’s report found that the two highest CEO users of corporate jet perks were Meta’s Mark Zuckerberg at $2.3 million and Lockheed Martin’s James Taiclet at $1.3 million in 2022. In Zuckerberg’s case, the use of the corporate jet for personal use was tied to a $24.8 million security program that Meta noted in its proxy filing was authorized “to address safety concerns due to specific threats to their safety arising directly as a result of Mr. Zuckerberg’s position as our founder.”
The number of CFOs utilizing corporate jet perks rose from 54 CFOs in 2018 to 76 CFOs in 2022, according to Equilar’s research.
“In terms of other executives, CFOs are another role that have been awarded these perks lately over the last few years,” Batish said. “Obviously not to the same extent as CEOs, but they are starting to gradually grant more perks to their CFOs. I think of the highest ones in 2022 was the Walmart CFO John Rainey who received $424,200.”
While corporate jet perks are a notable benefit conferred on high-level executives at large companies, Batish explained that they’re a relatively small part of those executives’ total compensation packages.
“On the surface, I think it does draw a lot of scrutiny but it is kind of a small sliver of the pie when you look at CEO pay and how much those folks tend to make,” Batish explained. “If you look at the same subset of companies, the median total compensation is around $14 million and aircraft perks are around $130K. So it’s really a small piece of the puzzle, but it’s something that does often draw the ire of the public.”
Businesses have increasingly utilized corporate jets to make travel more efficient, and allowing their use for personal trips with the authorization of a company’s board helps attract and retain talented executives, said Ed Bolen, president and CEO of the National Business Aviation Administration.
“The post-COVID business landscape is as competitive and rapidly changing as ever, requiring all company activities, including travel, to optimize efficiency, productivity and flexibility,” Bolen wrote to FOX Business. “Similarly, competition to attract, invest in and retain key employees – including with solutions for seamlessly meeting both personal and business obligations – is as intense as it has ever been. The value of a business airplane speaks to both of these priorities.”
He explained that corporate jets give executives “an unmatched ability to schedule multi-stop business trips, promptly respond to unforeseen opportunities and meet unexpected customer needs, while remaining quickly available for travel to meet personal commitments.”
“It’s a capability that sharpens a company’s competitive edge and increases shareholder value, while protecting key employees’ security and safeguarding against corporate espionage,” he added. “That’s why such travel is typically made with the full approval of directors serving on boards with a number of companies ranked as the nation’s most-innovative, highest-performing and most-trusted brands.”