Boeing: Boeing CEO compensation rises 45% – 04/06/2024 – Market

Boeing announced this Friday (5) that CEO Dave Calhoun, who will remain in office until the end of the year, received US$32.8 million in compensation in 2023.

The figure represents a 45% increase over the previous year, even as the aircraft manufacturer struggles to contain a crisis of confidence in its quality controls.

Calhoun received a potential $30 million stock bonus in addition to his $1.4 million base salary, the company said. As of 2022, he had received $22.6 million.

However, the share-based bonus will not become effective until he sells the shares, which cannot be immediately redeemed in full. Thus, he could even lose part of the total amount if he resigns at the end of this year, as he announced he would do last month. Boeing’s share price has fallen 27% since the start of 2024.

“As the company continues its efforts to restore stability and public confidence during a crucial period of transition for Boeing, it is emphasized that Calhoun’s 2023 bonuses are designed to emphasize the importance of growing shareholder value to long term,” the company said.

The company added that in February this year he turned down a planned annual bonus of $2.8 million, which would have raised the total even higher.

Boeing has struggled since January, when a door panel exploded mid-air during an Alaska Airlines flight.

The crash, which involved a Boeing 737 Max 9, is being investigated by the US Department of Justice, the National Transportation Safety Board and the US Federal Aviation Administration.

The company has had to reduce production of the 737 Max as it seeks to resolve manufacturing flaws, and some airlines have been forced to alter their flight schedules due to delays in deliveries of their aircraft.

Boeing warned it would burn more cash in the first quarter than previously expected due to the crisis.

While the Alaska Airlines accident “shows that Boeing still has much work to do, the board believes that Mr. Calhoun responded to this event in the appropriate manner by taking responsibility for the accident,” the company said.

The award will be submitted to a vote by shareholders at Boeing’s annual meeting, scheduled for May 17.

Calhoun’s salary had already been criticized last year. Proxy consultancy Institutional Shareholder Services said in 2023 that the company increased its CEO’s salary despite reporting negative total returns to shareholders.

“The company underperformed during CEO Calhoun’s tenure,” ISS said last year.

Separately on Thursday, US Senator Tammy Duckworth further criticized Boeing. In a letter to the FAA, she said Boeing’s failure to inform pilots that the cockpit door of a 737 Max must open during rapid depressurization was “alarming given its history of withholding 737 Max information from pilots.” .

“This is dangerous, and the FAA should not view this latest omission in isolation,” she said.