U.S. executives offer more advantages to Covid
Large U.S. companies, including Morgan Stanley, Yum Brands and PepsiCo, last year extended their private jet privileges to senior executives over the Covid-19 pandemic, new regulatory filings show.
Yum Brands gave CEO David Gibbs permission to allow personal travel on the company’s aircraft to other executives, and Morgan Stanley authorized several directors to use the company’s aircraft for personal purposes.
UPS delivery company Brian Newmani, his chief financial officer, used the private plane for personal reasons due to the pandemic, but said the advantage “will not be a common practice”.
As a result of the pandemic, PepsiCo CEO Ramon Laguarta’s personal travel cost doubled in 2020 compared to the previous year.
The manufacturer of the Sealed Air bubble collection allowed executives to use private jets to travel between locations such as the North Carolina headquarters and “the executive’s family was protected in its place.” The policy stopped at the end of 2020.
While executive private jet travel has sparked outrage in the past, the pandemic is “the only time it has made sense to do so,” due to limited availability of commercial flights in 2020, said David Yermack Stern, a professor at New York University School of Business. He has traveled in the private planes of directors.
However, aircraft spending raises doubts as to how much the rumors were used for the holidays, he said. “It’s not a plane, it’s a holiday trip itself that’s what I find interesting,” he said. “Why are they going on vacation?”
Dieter Waizenegger, executive director of CtW Investment Group, admitted that the privileges of the aircraft in the pandemic seemed “reasonable,” but said it was disappointing that the company’s health concerns are not always extended to first-class employees. Yum Brands pointed out that this year CtW questioned the shareholders ’proposal to conduct a feasibility study to extend paid sick leave to the company to all employees.
Yum Brands and Morgan Stanley refused.
UPS has not changed policies related to the personal use of private jets, and Newman’s only exception was accepted “because of the high uncertainty surrounding commercial air travel at the time of the pandemic at the time of the pandemic,” the delivery company said.
Corporate spending on private jets has increased over the past year. The average value of spending by private Fortune 100 companies on private aircraft rose to $ 125,796 for companies with fiscal years as of August 31, 2020, according to the salary data company. The figure rose 9 percent in 2019 and spent $ 128,075 in 2018, Equilar said, adding that total expenditures vary due to changes in aircraft fuel costs.
U.S. disclosure rules require companies to report a number of benefits to executives who provide companies with a total of $ 10,000 or more. In addition to private jet travel, companies are required to pay for membership in a management club or for financial planning.
Overall, private flights were down in the pandemic. Teterboro Airport, which is close to Manhattan and one of the most private places for U.S. aircraft to land, saw flight departures fall by 50 percent in 2020 compared to the previous year, according to the aviation rating agency Argus International.