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CEOs Are Spending More and More of Their Company’s Money on Vacations

CEOs Are Spending More and More of Their Company’s Money on Vacations

Written by Alan Pyke

Corporate CEOs are back to using company jets for personal travel after the practice dipped briefly following the financial crisis, Bloomberg reports.

“Non-business travel expenses” increased for the third straight year, and the 10 largest S&P 500 companies that Bloomberg scrutinized spent 61 percent more last year on personal travel using corporate jets than they did in 2012. The costs rose 3.1 percent for the 50 largest companies that disclosed the relevant figures.

General Electric spent over $343,000 flying CEO Jeffrey Immelt around for personal travel on the company plane last year. Immelt made $19.7 million in 2013, according to Executive Paywatch.

Casino mogul Steve Wynn earned $19.6 million, and billed Wynn Resorts Ltd. about $927,000 in personal travel on the corporate jet. (The Wynn Resorts board did, however, force Wynn to start paying the $525,000 annual rent price for his Las Vegas house out of his own pocket last year.)

Corporations shoulder their top employees’ vacation expenses in part to make sure CEOs can hurry home if something urgent arises during their leisure time. Companies like Halliburton and Boeing even require CEOs to use corporate planes for such travel. Immelt and Wynn are also required to fly on company planes. Regardless of the business rationale, the practice effectively increases executive pay and in many cases even reduces tax liability for CEOs.

The resurgence of perks like this signals that the decline of corporate jet spending that followed the financial crisis was just a brief moment of public shaming and not a lasting shift in corporate culture. In the immediate wake of the crisis, companies cut personal use of corporate planes by about a third. The heads of bailed-out companies were famously blasted by lawmakers for using corporate jets to fly in for congressional hearings. A tax write-off for the planes became a totem for critics of corporate welfare, including President Obama.

But like corporate payinvestment earnings for the wealthy, and Wall Street profits, company jets are roaring back from the recession much faster than economic indicators relating to middle- and low-income families and workers. Wages continue to stagnate. The ratio of CEO pay to worker pay continues to expand across the economy, peaking at over 1,200-to-1 in the fast food industry. And huge proportions of the population are unable to afford their rent or avoid living paycheck to paycheck.

This post originally appeared on ThinkProgress

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Photo credit: Thinkstock

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82 comments

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1:46PM PDT on Aug 19, 2014

Janice T.
1:29pm PDT on Aug 19, 2014
They are following our President's example.

Sorry little guy, you will pay for that too
Read more: http://www.care2.com/causes/ceos-are-spending-more-and-more-of-their-companys-money-on-vacations.html#ixzz3AsBNq0Kf

President Obama has taken fewer vacations than former President Bushjr. Who was constantly on vacation on his ranch in Texas. But don't let that stop you in posting something snarky.

1:29PM PDT on Aug 19, 2014

They are following our President's example.

Sorry little guy, you will pay for that too.

7:23PM PDT on May 26, 2014

These numbers just make me ill. All that wasted money while people are homeless.

12:18PM PDT on May 15, 2014

The greedy CEOs are called the Nazi of the 21st century!!!!

8:01AM PDT on May 10, 2014

SO what would be so important that a CEO has to be on the ground immediately.. Maybe a labor dispute. Naw lawyers.. Maybe a catastrophe at a plant or store.. EMT, law enforcement, PR people, and lawyers..

Hmm now what would make a CEO need to have the company jet on standby.. Oh yeah some one can not find a file on a desk and a the secretary is in tears because she broke a nail.. Mi Gods man think of the stocks.. Something like that needs the CEO on the ground stat.. Before the stock takes a nose dive.

Face it we are in a new gilded age of moneyed privilege. The CEO's act worse than the ones did a century ago.

12:51AM PDT on May 9, 2014

To be raping the company's profits for stock holders & CEO's comfort, while 30% of the working labor force is out of work is reckless at best, & worst, pure evil. WOULD love TO HAVE A TRUE aPRIL fOOL'S DAY, & SWITCH PLACES, WE FOOLS WITH THOSE KINGS!

6:23PM PDT on May 8, 2014

No, the simpler solution is a tax on company turnover.

Your company turns over $20M but has to pay the Irish division $19.999M for use of their IP. Under the current system you pay tax on $0.001M ($100,000)

Under the new system you pay tax on $20M.

Oh, your costs are $19,999M. Too bad. Outsource their services, your profit will be higher. NEXT!

5:27PM PDT on May 8, 2014

Learned from the top down, now all in positions of power pretty much take what they want ... screw the rest of us. Funny when you think about it, without us they wouldn't have a job in the first place.

10:36AM PDT on May 8, 2014

Of course they are...

8:50AM PDT on May 8, 2014

The super-rich just get richer and pay proportionately less tax than their employees through share scams, non-taxable perks and straightforward tax evasion - the poorest end up paying proportionately more through consumption taxes eating up a larger part of their smaller income as well as their income taxes. There should be a cap on CEO pay and perks: say no more than 20x their lowest paid employee. Laissez faire economies only exacerbate the social divide, increase crime and decrease social mobility: the American dream is bogged down in Capitalist slime.

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