One price that hasn’t risen due to inflation is the cost of keeping Warren Buffett safe and sound.
Personal and home security bills that Berkshire Hathaway covered on behalf of chairman and CEO Buffett fell 19% from a high in 2016 of $387,881 to $313,595 in 2023, according to the company’s public disclosures last week. Personal security perquisites for CEOs typically include home security systems and installation in primary and secondary residences, security guards for the CEO and their family, a car and defensive driver and even cybersecurity insurance and defense, said Jun Frank, managing director and global head of compensation and governance advisory at ISS-Corporate. The advisory firm’s review of CEO perks between 2020 and 2023 found that home security perquisites for S&P 500 CEOs rose in prevalence from 12.6% in 2020, to 15.7% in 2023. It was one of only two perks in which inclusion in executive comp plans didn’t drop during the period 2020 to 2023. (The other perk that didn’t decline in prevalence was corporate jet travel.) Median values of security perks rose from $34,300 in 2020, to $40,700 in 2023.
In Buffett’s case, the cost of his security perks has fluctuated over the years between 2016 and 2023, averaging about $312,000.
According to Frank, price changes are usually the result of more or less travel abroad, vacations and alarm installations and servicing. Overall, one of the main drivers underlying the rising cost of personal security perks is inflation, Frank said. Frank did not comment on Buffett’s perks specifically.
“The cost of everything is rising so part of that is inflation—the cost of services and goods are increasing, said Frank. The other piece is that the threat landscape for CEOs has shifted as some have taken on more visible roles, political stances or have generated negative public sentiment, he said. “It’s worth noting that the board typically reviews this on annual basis,” he said. In some years actual or perceived threats might be increasing or decreasing.
Meta Platforms disclosed last year that the board increased founder and CEO Mark Zuckerberg’s security perk from $10 million to $14 million, among the highest among large-cap companies. A security assessment found specific threats to Zuckerberg that stemmed from the high-profile nature of his role as CEO, chair and controlling shareholder. “We believe that Mr. Zuckerberg’s role puts him in a unique position: he is synonymous with Meta and, as a result, negative sentiment regarding our company is directly associated with, and often transferred to, Mr. Zuckerberg,” the company said last year in its disclosures. Alphabet CEO Sundar Pichai was the highest-paid CEO last year at $226 million; his personal security perks clocked in at $5,935,084.
Pfizer paid $789,495 in security perks for CEO Albert Bourla due to “heightened security risks including threats” that led to additional security protections.
According to ISS-Corporate’s perk survey, financial services firms in the S&P 500 saw the largest increase in adoption of home security perks for CEOs in recent years, followed by IT companies.
Wells Fargo covered costs of $81,264 for CEO Charles Scharf in 2023 to pay for implementing residential physical and cyber security improvements and ongoing maintenance. Of that amount, $66,465 was to cover installation expenses, the company said last week. American Express spent $138,532 on CEO Stephen Squeri for home security and security during personal trips.