Many corporate jets used for personal CEO travel: report
I’ve never owned corporate stock, nor have I certainly owned shares in a company with a notoriously spendthrift CEO – Conrad Black, Dennis Kozlowski, whoever.
According to a new report from the Wall Street Journal, about 30 per cent of trips made by private jets owned by publicly-traded corporations between 2007 and 2010 were to resort destinations, suggesting that executives routinely use company planes for pleasure instead of business.
The study, which tracked FAA records for the three-year stretch, found that anywhere between 30 and 50 per cent of some companies’ planes made no bones about taking execs to beach trips or vacation home getaways – more to the point: anywhere where business wasn’t likely to have been conducted.
Of course, CEOs and execs of major companies are afforded some use (“limited” is the way most corporations word it) of corporate jets for rising to the top spot in their outfits. Perks of the job.
But the WSJ report found cases of apparent executive abuse of such policies, most notably among EMC Corp., the publicly-traded data storage firm.
According to flight records, EMC’s five corporate jets made 393 trips to Cape Cod and the Florida keys between 2007 and 2010, two locales where company CEO Joseph Tucci, who brings in about $9 million in total compensation each year, owns homes.
Another analysis of holding firm Leucadia National Corp. found the company’s jets spent 220 hours in 2009 shuttling chairman Ian Cumming between his Wyoming and New York homes, trips that would have cost about $708,000 on a commercial airline.
Leucadia reported less than $30,000 worth of personal flying for Cumming that year, which certainly may not add up. Under SEC disclosure rules, personal travel on the company dime must be reported at public companies if the sum exceeds $25,000.
So, while corporate jets are pitched to shareholders as a necessity – a requisite device to shuttle executives off where they’re needed and fast – no one’s likely that surprised they serve other purposes, too.
By Jason Buckland, MSN Money