The Hidden Warning Sign in a CEO’s Private Jet
Thursday, October 1, 2026 · Johnny Hopkins
During their recent episode, Taylor, Carlisle, and Alex Edmans discussed The Hidden Warning Sign in a CEO’s Private Jet. Here’s an excerpt from the episode:
And one example is the corporate jet. So corporate jets, you might think, well, they’re actually a good thing.
They get the CEO to a meeting where they’re able to push it at full throttle. But they could also be a sign of huge managerial excess. So the movie Barbarians at the Gate was very famous, and it highlighted Arjo and Obispo had 10 private planes, which ferried not just the CEO to meetings and events, but also a passenger called G Shepard.
That was the German Shepard, that was the dog of the CEO. So if this is happening, then this could be a case of massive corporate malfeasance. And what a study found was that companies where they allowed a personal usage of the jet, the stock price fell by about 4% per year, applied to the average value of $7.5 billion. That is $300 million of underperformance. Now you might think, well, do those numbers stack up? Because if you even rented a jet for $50,000, you’re forced to disclose that to the SEC.
So how can something that costs you $50,000 be worth $300 million? Well, it’s because it’s the tip of the iceberg. So the companies where the CEO was able to use the corporate jet, maybe the CEO was able to get away with a lot of other things.
Maybe the board is in the CEO’s pocket, which is why they allowed that. Maybe the CEO’s overpaid, maybe they’re making massive expansions and empire building acquisitions. And so this is a window into the culture of the company, and which is why I think it was such a great study.
And the Chapter 7 goes and looks at many other seemingly trivial, but actually data-reinforced measures of CEO power, which could be the size of your photo in the annual report compared to the rest of your top management team. Because that might suggest, I don’t need to listen to my colleagues, whether the CEO refers to I rather than we. And even something like the size of their signature when they’re signing the shelter letter.
Rupert Murdoch has notoriously a large signature, which one might say is consistent with this character. So what are the small tells that we can look at in a CEO’s character to tell us about what is the character of the person at the top?