The recent murder of Brian Thompson, a top executive at UnitedHealth Group Inc., has ignited troubling discussions around corporate security practices.
Shockingly, the 50-year-old Thompson was shot outside the New York Hilton Midtown during an investor day event for the country’s largest health insurer.
Investigators have deemed the attack targeted, which raises serious questions about the lack of personal security that Thompson had in place at that moment.
Corporate Security Practices Under Scrutiny
Chief of Detectives Joseph Kenny from the New York Police Department emphasized that Thompson entered the hotel on his own, highlighting the absence of any security detail accompanying him.
This tragic event may act as a pivotal moment, prompting companies, particularly in the health insurance industry, to rethink their approaches to safeguarding executives.
According to the most recent proxy statements from UnitedHealth for 2023 and 2024, the company currently does not provide any additional security benefits to its executives.
This stands in stark contrast to firms like Meta Platforms and Alphabet, both of which invest significantly in executive protection.
Publicly traded companies are required by U.S. Securities and Exchange Commission regulations to disclose spending on security that exceeds $10,000 in a year, emphasizing transparency in executive safety measures.
Industry Responses and Trends
Unlike UnitedHealth, other prominent insurers such as Humana and Cigna do offer personal security for their executives, although they don’t disclose how much they spend on these protective services.
An analysis by Equilar, a firm focused on executive compensation data, highlighted that the median spending on security perks among S&P 500 companies has surged, nearly doubling to close to $100,000 between 2021 and 2023.
More companies are now recognizing the importance of providing these measures for their top leaders.
While some organizations hold back on investing in executive security out of fear that it might draw negative attention, this is a growing concern.
Glen Kucera, an industry expert from Allied Universal, pointed out that many companies prefer to steer clear of the complications that come with security measures, assuming that executives like Thompson may feel secure without them.
Long-Term Security Investment
In contrast, Exxon Mobil demonstrates a long-term commitment to executive safety.
For over thirty years, the corporation has enforced strict security protocols, including mandatory use of company aircraft for all travel, a measure introduced after a notorious kidnapping incident in 1992.
Last year alone, Exxon spent more than $377,000 on security for its chairman and CEO, establishing that such expenses are simply part of ensuring safety for individuals in high-stakes roles, rather than personal perks.
At UnitedHealth, the only security protocol currently in place is a guideline that requires CEO Andrew Witty to use company planes for business travel.
Although he is advised to follow the same recommendation for personal trips, he chose not to utilize this option in 2023.
This standard did not extend to Thompson, who was the CEO of UnitedHealthcare.
As of Wednesday afternoon, authorities are still searching for the suspect involved in Thompson’s shooting, with the investigation ongoing.
In the aftermath of this violence, Kucera reported a notable increase in inquiries concerning security services for corporate executives, signaling a shift in how companies perceive the necessity for such preventive measures.
The debate over security-related perks has caught the attention of proxy advisory firms, which caution that excessive security benefits may suggest deeper issues within compensation frameworks.
Nonetheless, they acknowledge that if the demand for enhanced protective measures persists, companies will likely continue to add these benefits for their executive leadership teams.
Source: Insurancejournal
