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Seguridad Corporativa y Protección del Patrimonio.
 

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Matthew Kirdahy


Leadership Reporter Forbes.com

The cost of protecting the Chief Executive Officer (CEO)


Guarding the boss seems to be of the utmost importance these days.

America's largest corporations are paying millions of dollars a year to protect their C-level talent, particularly the CEO. That personal security, as described in compensation reports filed with the U.S. Securities and Exchange Commission, includes everything from computerized home systems to use of company aircraft domestically and internationally, both for business and personal matters. The cost incurred by companies falls under the perquisite, or "perk," category.

Among U.S. chief executives, Oracle's (nasdaq: ORCL - news - people ) Larry Ellison is racking up the highest personal security costs--$1.7 million in 2007, according to compensation reports filed with the SEC by his company. Up there with him are Limited Brands (nyse: LTD - news - people ) CEO Leslie Wexner ($1.25 million) and Amazon.com (nasdaq: AMZN - news - people ) CEO and founder Jeff Bezos, ($1.2 million). All three men are on the list of Forbes' richest people, which partly explains the fuss.

Ellison's security expenses are notoriously high--the billionaire has also spent a considerable sum of his own money installing top-of-the-line security systems at his Malibu and Woodside, Calif., estates.

Security specialist Alan Schissel said that in cases where companies are paying such incredible amounts, it's likely for a team to watch the boss' back, in addition to any home-security system costs. That goes for at the office, on the road and even at home.

Schissel, CEO of Integrated Security Services, said that someone with 24-hour protection could require six bodyguards--commonly either current and former police officers or retired military--each working, on average, eight to 12 hours on a rotating basis. Though in many instances they're necessary, he doesn't consider their presence a benefit by any means.

"I don't consider it a perk because it's somewhat of a burden," he said, explaining that effective security for high-profile executives often involves the presence of guards at all times.

Mike Intravia, CEO of St. Louis, Mo.-based Allied Intelligence, said the globalization of big business has increased demand for the security services his business provides and has escalated costs. The rise in CEO travel has given "on the road" a new meaning. Now executives need watchdogs in foreign countries abroad--and that protection starts in the air.

To ensure the safety of their leaders, as well as their leaders' families, some large public companies mandate private airplane use for all business and some private travel. At Ford Motor (nyse: F - news - people ), CEO Alan Mullaly spent $752,000 using the company jet last year. The CEO of Chesapeake Energy (nyse: CHK - news - people ), Aubrey McClendon, spent $600,000, while Starbucks (nasdaq: SBUX - news - people ) CEO Howard Schulz spent $400,000 on private flights.

On the ground, one of the most important pieces in an executive's security team can be the driver--often more of a chauffeur commando than a mere wheel jockey.

According to the book Just 2 Seconds, which analyzes hundreds of attacks on public figures from 1970 to 2000, the majority happened while the victims were in or around their cars.

A trained security driver adds an extra layer of protection--often the most important layer, said Joseph Autera, senior instructor and president of Tony Scotti's Vehicle Dynamics Institute. If a CEO is ever attacked while on the go, "that driver may be the only real protection the executive has at that moment."

If a trained driver had been on the job, things might have gone differently for financier Edward Lampert in 2003. Abducted from his company parking garage, the ESL Investments chairman was held for ransom for a little less than two days, until convincing his captors to release him.

What are the risks? According to Just 2 Seconds, business executives aren't targeted for assassination as often as other prominent individuals. Of 436 successful attacks on public figures worldwide from 1970 to 2000, 68% of the targets were politicians and government officials, and just 6% were business executives.

However, when kidnapping is the aim, their proportion rises. The book, co-written by Tom Taylor, Jeff Marquart and Gavin de Becker, best-selling author of The Gift of Fear, says that of 65 kidnapping incidents where a public figure was the target, 31% were executives, behind governmental officials at 42%.

Edward Mueller
CEO Qwest Communications

Not all of America's big bosses need a round-the-clock brute squad watching their backs. Qwest only spent $5,400 on personal security for Mueller. The majority of the perquisite money was used on the corporate jet. The company spent $281,000 on his use of the aircraft in 2007, up from $332,000 the prior year.

 

Lawrence Ellison
CEO of Oracle


The tech company spent $1.7 million in 2007 on security to protect its chief, who happens to be one of the richest people in the world. The company spent $1.8 million to protect the boss in 2006, $1.3 million in 2005 and $531,000 in 2004. Ellison also has dipped into his own pocket for the initial installation and some maintenance costs for some home security systems. The company pays for guards and replacement equipment.

 

Robert Kelly
CEO of Bank of New York Mellon


Bank of New York Mellon pays $235,000 for combined costs associated with protecting the CEO. That security expense includes $179,000 for a personal driver, $84,000 for use of the company aircraft and $1,900 for a home security system. The company paid $16,000 for that home security system in 2006, most likely for installation.

 
Leslie Wexner
CEO of Limited Brands

The clothing retailer pays for the protection of Wexner and his family for personal and private matters due to his financial stature. The CEO is one of the world's richest people and most prominent business leaders. In 2007, Limited Brands spent $1.25 million, up from $1.3 million the previous year. This includes use of corporate aircraft and on-the-ground transportation.

 
Jeff Bezos
CEO of Amazon.com

In the last two years, the online retailer has spent a combined $2.4 million, $1.2 million each year protecting its boss and founder, who has a net worth of $8.2 billion. Not bad for a guy who only earns a salary of $81,000.

 

Michael Dell
CEO of Dell

When you've got your name on every box the company distributes, you're entitled to at least a bodyguard. Dell spends $1 million a year protecting its CEO and founder, along with his family. The security extends to his home. Additional security is provided to his family, though Michael Dell uses some of those costs

 

Ray Irani
CEO of Occidental Petroleum

The company spent $775,000 protecting the boss in 2007, up from $563,000 in 2006. Occidental offers protection for all of its high-level executives as needed. That includes at-home security systems and guards. In 2007, it also spent some of the $239,000 in perquisites designated for senior vice president and general counsel Donald de Brier on security.

 

Howard Schultz
CEO of Starbucks

The global coffeehouse chain valued its founder and boss' personal security at $496,000, up from $468,000 in the prior year, when Schultz opted to shift gears into the role of chairman. Starbucks spent an additional $400,000 for Schultz's use of the company aircraft in 2007, down from $475,685 in 2006.

 

Samuel Palmisano
CEO of IBM

IBM spent $406,000 on personal security for Palmisano and his family. The company mandates that security be available for company and certain non-company engagements. That expense included personal use of the company car, personal security, family attendance at company-related events and other personal expenses. In 2006, IBM spent $373,000 on Palmisano's protection.

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Fuente: www.forbes.com
Fecha: 21/08/08

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