Perks? What perks? Some tech CEOs go without
- 18 March, 2011 04:46
Many public companies are slowly doing away with CEO perks such as country club memberships, cars and drivers, and free financial planning services. But some tech CEOs are already accustomed to living without personal perks.
"We've been advising clients for years to eliminate peripherals. They are major irritants with shareholders, and the amount of flack in many instances far outstrips the dollar value," says Nora McCord, managing director at Steven Hall & Partners, an executive compensation consulting firm based in New York.
Getting rid of perks won't happen overnight. Many companies are contractually obligated to provide pricey perks as part of employment agreements inked years ago.
Meanwhile, at other tech companies, CEOs get the same benefits that are generally available to all employees, such as retirement benefits, life insurance and healthcare plans. Nothing extra, nothing extravagant.
For instance, there were no perks in 2010 for Apple CEO Steve Jobs, who continues to forego all compensation except for his customary $1 salary. Likewise, Salesforce.com CEO Marc Benioff's 2010 compensation package included no perks -- nor did he take home any extras in 2008 or 2009.
F5 Networks picked up the tab for CEO John McAdam's Internet service with a $600 stipend. But that's the extent of his executive perks. "The Company's executive officers participate in broad-based benefit plans that are available to other employees. The Company does not currently provide additional material perquisites for its executive officers," F5 said in its proxy statement.
That's the case at NetApp, too. CEO Tom Georgens' perks are limited to $1,932, which NetApp says is the imputed income of term life insurance in excess of $50,000.
Perks aren't a big deal at Red Hat, where the only extras CEO Jim Whitehurst received amounted to $5,289 and are attributed to 401(k) matching contributions and company-paid premiums for life insurance and accidental death and disability. These benefits are also generally available to all employees, according to the company's proxy statement.
Perks are also limited at Adobe, where CEO Shantanu Narayen received $7,350 for company 401(k) contributions and $336 for life insurance premiums.
Cisco CEO John Chambers' perks totaled $11,025, which is attributed to matching 401(k) contributions. The same employee benefit plans are available to all Cisco employees, and "Cisco's named executive officers generally do not receive any special benefits such as payment of club memberships, financial planning or executive dining rooms," the company noted in its proxy statement.
The only perks listed for Dell CEO Michael Dell add up to $13,623 and are linked to his retirement and benefit plans. That represents a big decline from years past, when Dell has paid more than $1 million for personal and residential security for its CEO.
"Effective for fiscal 2010, Dell will only provide Mr. Dell with business related security protection," the company stated in its proxy statement.
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