Companies Offering Executive Perks Despite Stricter Regulations and Heavy Debate
Date: December 13 2012
Kansas City, Kan. - Scrutiny of executive pay has seen a steady rise over the past few years, due in part to stringent SEC disclosure regulations and the Frank-Dodd Act say on pay requirements. Executive perquisites play no small part in these examinations as many companies offer them as a way to entice and retain the strongest leaders. The Compdata Surveys Executive Compensation 2012/2013 survey results found supplemental life insurance continues to be the perquisite most commonly offered to CEOs at 43.3 percent.
Car allowances were offered to CEOs at 36 percent of companies surveyed, compared to voluntary deferred compensation at 31.2 percent. CEOs at 25.3 percent of companies surveyed were offered club memberships as a perquisite and 13.9 percent were offered supplemental medical coverage. Only 8.2 percent of companies responding report offering a spousal travel allowance to CEOs as a perquisite.
"Over the past few years, there has been a lot of debate on the cost of executive perks versus the overall value - real or perceived - they provide," said Amy Kaminski, vice president for Compdata Surveys. "Most organizations offer perks to their leaders because they are effective at ensuring the company maintains the highest level of talent at the helm, although a few organizations have chosen to phase out some or all executive perquisite offerings."
Short-term incentives are often offered to executives as well, but generally require that specific goals be met. For example, company presidents receive short-term incentives based on meeting profit goals at 47 percent of companies surveyed. Other executive positions in which profits are used to determine short-term incentives include top marketing executives at 38.6 percent and CFOs at 36.8 percent.
Companies offer a variety of reward systems to executives, with bonuses continuing to be the most popular reward offered to vice presidents at 63.1 percent. In fact, 58.5 percent of organizations reported their vice presidents were eligible to receive a bonus in 2012, with 31.6 percent of VPs at those organizations actually receiving one. The average cash bonus amount paid to vice presidents in 2012 was $50,379.
About the Survey
Executive Compensation 2012/2013 analyzes national and regional data by base pay and total cash compensation for more than 70 executive and senior management positions. Information was collected from nearly 6,800 organizations across the country, reporting on over 31,000 incumbents.
Compdata Surveys has been providing comprehensive data at affordable prices to organizations from coast to coast since 1988 and is the nation's leading compensation and benefits survey data provider. Thousands of organizations provide data in each of our eight industry specific surveys each year, ensuring the reliability of our results. For more information about the compensation and benefits surveys, contact Michelle Willis at (800) 300-9570.