Free

HP CFO takes cheap-o private jet flight

When Hewlett-Packard (HPQ) filed its preliminary proxy on Tuesday, we were immediately surprised by one of the numbers in the footnotes to the summary compensation table: the $96 spent by CFO Catherine Lesjak on personal use of the corporate jet.

Now being all entrepreneurial and all, we don’t spend any time flying around in corporate jets here at footnoted. But we do spend a fair amount of time flying ordinary commercial carriers and we know that $96 doesn’t buy you a lot of time in the air, unless you happen to catch some sort of sale or score some cheapo last-minute flight due to excess availability. A quick scan of Travelocity for example shows that $95 will buy you a one-way ticket between San Jose and Los Angeles. While costs vary, corporate jets tend to cost significantly more — as high as $6,000 an hour for a Gulfstream V according to industry estimates. Here’s HP’s disclosure on personal jet usage:

For purposes of reporting the value of such personal usage in this table, HP uses data provided by an outside firm to calculate the hourly cost of operating each type of aircraft. These costs include the cost of fuel, maintenance, landing and parking fees, crew, catering and supplies. For trips by NEOs that involve mixed personal and business usage, HP includes the incremental cost of such personal usage (i.e., the excess of the cost of the actual trip over the cost of a hypothetical trip without the personal usage).

So we decided to send a note to the folks at HP asking them to explain the number since last year (as footnoted regulars may remember) a number in HP’s preliminary proxy for CEO Mark Hurd’s tax gross up on his meals was corrected after we pointed it out.

A spokesman said that the $96 was in fact accurate and while he couldn’t provide exact details, he said it was likely due to splitting the cost of the flight with other executives. Of course, given that Lesjak only spent $13 on personal jet usage in 2008, the $96 represents a seven-fold increase!

UPDATE 1/26: A spokesman for HP contacted me yesterday to further clarify the details in HP’s proxy statement. As it turns out the $96 was not for Lesjak’s flight usage, but instead was for her husband, who accompanied her to an HP event that Lesjak was attending. Given that this is the second year in a row that HP had to clarify something in its proxy statement related to the “all other compensation table” it seems as if they need to be a bit more careful with their disclosures in this table.