7 Totally Insane Executive Perks
Barring nepotism or cronyism, most high-powered executives have spent decades inching their way up the corporate ladder rung by rung. And once they reach the uppermost echelon of the working world, these big shots can expect mind-boggling paychecks; a 2007 study by nonprofit organization United for a Fair Economy found that the average Fortune 500 CEO raked in $10.8 million in 2006.
As if financial security for multiple lifetimes isn't enough, many top corporate executives are also treated to the kinds of lavish perks that the average company employee can barely comprehend, much less ever hope to enjoy. On top of their tremendous salaries, the highest-ranking bigwigs often receive "extras" such as personal use of the company plane, country-club memberships and fancy home-security systems. And though it's somewhat ironic that the employees who receive such perks are the ones who least need a free lunch, some corporate executives have taken this idea to its illogical extreme. Below are seven executive perks that stand out as excessively pricey, overly demanding or just plain strange.
1. Crazed Company-Car Demands: Appearance is everything in Los Angeles. This may explain why in the spring of 2003, Barry Munitz — former CEO of The J. Paul Getty Trust — decided to forgo a Toyota Camry or a Honda Civic when ordering a company car. Instead, Munitz demanded a $72,000 Porsche Cayenne SUV. True to form, Munitz wanted the vehicle fully loaded; according to the Los Angeles Times, he told an aide that the SUV should have the "best possible sound system," and the "biggest possible sunroof." Despite the fact The J. Paul Getty Trust could afford to indulge Munitz's taste for fancy cars, it couldn't manage to find the money to continue to employ seven security managers, who were laid off just days before Munitz requested the Porsche.
2. An SUV That Can Survive Armageddon: While some CEOs are out to impress Hollywood high-rollers with their company rides, others are more concerned, to put it lightly, with their physical safety. Take Macy's Inc. chairman and CEO Terry Lundgren. In a move that would make any third-world despot proud, Macy's stockholders have paid to equip Lundgren with an Armored Hummer H1 to the tune of $87,000 per year, according to footnoted.org, a blog that closely examines corporate SEC (Securities and Exchange Commission) filings. Documents filed by the company state that "Macy's is providing Mr. Lundgren with a specially-equipped car and driver for commuting in New York City, for certain business travel and for personal use." Lundgren may not have to worry about taking a bullet during his travels, but someone is still going to have to figure out how to parallel park the 15-foot behemoth on New York City streets.
3. Think Your Rent Is Pricey?: Speaking of New York City ... anyone who has ever visited the Big Apple can confirm that the place isn't cheap. No one knows this better than Manhattan residents, who shelled out an average of $2,900 per month for a one-bedroom apartment (without a doorman) in 2007. But that pales in comparison to the $80,000-per-month rent that GE (General Electric Co.) forks over for former CEO Jack Welch's palatial Manhattan apartment. Though Welch retired in 2001, GE stockholders will continue to foot the bill for his living expenses for the rest of his life. Beat that retirement package.
4. Getting Paid to Sleep in Your Own Home. What?: Most of us pay for the roof over our head, not the other way around. Unless, of course, you were a top executive at media mammoth Viacom Inc. circa 2004. In April 2005, the company announced that it had paid co-presidents Leslie Moonves and Thomas Freston to sleep in secondary homes that they own in New York City and Los Angeles respectively. In 2004, Moonves raked in $105,000 for crashing in his own bed, while Freston received $43,100 for doing the same. Both men made almost $20 million each that year but apparently still needed a little help with the mortgage.
5. The Million-Dollar Birthday Party: There are parties, and then there are parties. Karen Mayo, wife of former Tyco International Ltd. CEO L. Dennis Kozlowski, clearly got the latter in June 2001 when her husband threw her a week-long bash with 75 of her closest friends on the island of Sardinia. In what can only be described as an absurd exercise in excess, Mayo's Roman-themed party featured (among other things) female "servants" who hand-fed grapes to the revelers. (Oddly enough, the party's music took a sharp left turn from the ancient-Rome theme when Jimmy Buffett was flown in to play a $250,000 set.) The party's total tab came to about $2 million, half of which Tyco kindly picked up.
6. Free Airfare for the Whole Family — Forever: The pitfalls of air travel — huge security lines, lengthy delays and planes full of screaming children — can add insult to injury when you consider that you just paid through the nose to put yourself through hell. But Continental Airlines Inc. directors and their families can't complain like rest of us, considering that the company provides them with free, unlimited flights for as long as that director is alive, according to footnoted.org. But not even death can quell the greed of Continental Airlines directors; they now receive "survivor benefits," which give their families up to $10,000 of travel per year for 10 years after they themselves have gone to the great VIP lounge in the sky.
7. A Private NASA Runway: Google is well-known for offering unusual perks to even rank-and-file employees, including free gourmet meals, dry-cleaning and haircuts. So it would only stand to reason that Google co-founders Larry Page and Sergey Brin would receive a perk that goes above and beyond what the worker bees enjoy. In 2007, Google struck an agreement with NASA to park three of its corporate jets — including a customized Boeing 767 — at Moffett Field, which is less than two miles away from the company's headquarters in Mountain View, Calif. Although this perk doesn't come cheap — costing the business $1.3 million per year, Google shareholders are unlikely to complain about the expense as long as the company's stock price continues to dominate.
