The group has been at the center of attention of US authorities in recent months, particularly regulatory and judicial bodies, due to safety and quality control problems.
Its directors expected this Friday’s general assembly to be similar to previous ones, peaceful and lasting less than an hour, but this year’s context increases the risk of storms.
This is mainly due to the fact that shareholder advisory companies have sent recommendations to vote against several draft resolutions, specifically targeting CEO Dave Calhoun, who has been in office since 2020 and whose departure is scheduled for the end of 2024.
Calhoun’s departure follows the incident that occurred on an Alaska Airlines flight in January, the last straw after a series of production problems in 2023.
The device, a 737 MAX 9, lost a blind door in mid-flight. Although there were no serious injuries, an emergency landing had to be made.
Despite this, Calhoun is a candidate to remain on a board of directors that he has been on since 2009.
The advisory firm Glass Lewis advised shareholders to reject that possibility and Investor Shareholder Services (ISS) asked them to vote “no” on his bonus, of around $33 million for 2023.
A recent document sent by Boeing to shareholders highlights the role played recently by the new chairman of the board, Steve Mollenkopf.
This former Qualcomm director is responsible, in particular, for overseeing the search for Calhoun’s successor.
“We are determined to ensure that each Boeing aircraft meets the strictest safety and quality standards,” the document highlighted.
The concerns
For Glass Lewis, shareholders should use Friday’s annual general meeting to send a message to Boeing.
“We have serious concerns about the way in which the board of directors has sought to safeguard the company’s safety culture and about its attempts to restore it,” the firm said in a recent report.
Glass Lewis recommended shareholders oppose the reappointment of not only Calhoun but also Akhil Johri and David Joyce, respectively head of Boeing’s audit and aerospace safety committees.
A vote in that sense will send the Council “a clear signal of discontent,” he noted.
He stressed, however, that other council members who make up the safety committee have “extensive and crucial experience in risk management and aviation security,” and that expelling them all simultaneously “would not be in the long-term interests of the shareholders”.
For the ISS company, what poses a problem is Dave Calhoun’s remuneration.
His expected annual base salary is $1.4 million, to which more than $30 million must be added in the form of shares.
After the Jan. 5 incident, Calhoun waived an additional $2.8 million bonus.
When detailing this package, Boeing referred to the crises that the current CEO had to manage, such as the recertification of the 737 MAX, grounded for about twenty months after the accidents of two planes in 2018 and 2019, which left 346 dead, and the pandemic. of Covid-19.
“The accident of Alaska Airlines Flight 1282 demonstrates that Boeing still has much work to do, but the board of directors believes that Mr. Calhoun responded correctly (…) by taking responsibility” for the incident and “interacting in a transparent and proactive manner with regulators and customers,” Boeing said.
The company also mentioned, in favor of Calhoun, “the important measures adopted to strengthen the quality” of production.
ISS argued for its part that the package that Calhoun would receive upon leaving office should be rejected because it provides for an increase in bonuses linked to long-term objectives for the third consecutive year.
Source: With information from AFP.
