Boeing boss’s $33m pay package approved

Boeing shareholders have signed off on the plane-maker’s plan to grant outgoing boss Dave Calhoun a 2023 pay package worth nearly $33m (£25m).

A majority voted in favour of the plan, which had drawn criticism as the company grapples with a crisis sparked by the mid-air blowout of a panel on one of its planes in January.

Such pay votes, held at the company’s annual meetings, are not binding.

A breakdown of the vote was not immediately available.

Ahead of the meeting, at least one prominent shareholder advisory group had criticised the plan and it also drew attention from some investors who spoke at the event.

The firm’s decision to keep outgoing boss Dave Calhoun on the company’s board of directors had raised questions as well, but was also approved.

Mr Calhoun’s compensation package included salary of $1.4m (£1.1m) and stock awards worth about $30m (£23m) when granted.

That compared to a package of roughly $22.6m (£17m) in 2022.

In a question-and answer session after the vote, the firm was asked how the compensation for Mr Calhoun and others were “justified” given the severe challenges now facing the company.

New board chairman Steve Mollenkopf said the board had reduced some 2024 awards for executives after the accident and moved swiftly to overhaul the design of its pay incentives.

That included giving product safety the primary weight in determining performance, instead of financial factors – such as cash flow and share price – as had been the case previously, he said.

But both he and Mr Calhoun acknowledged the strains facing the company, some of which Mr Calhoun described as “potentially existential” in nature.

The Alaska Airlines incident revived questions about the firm’s manufacturing and safety procedures and has spawned numerous investigations and lawsuits.

Just days ago, the US Department of Justice (DOJ) said it was considering whether to prosecute Boeing over deadly crashes involving its 737 Max aircraft in 2018 and 2019, after determining it had breached a deal that shielded it from criminal charges.

In March, Boeing said Mr Calhoun would step down by the end of the year.

The search for his replacement is a key focus of the company now, Mr Mollenkopf said.

“The months and years ahead are critically important for our company as we take the necessary steps to regain the trust lost in recent times,” he said.

In putting the pay package to shareholders earlier this year, the company praised how Mr Calhoun had steered the company through challenges such as Covid since 2020.

It said he had responded to the Alaska Airlines blowout “in the right way”.

“The 737 MAX accidents and COVID have combined to create tremendous stress on the Company’s manufacturing operations and supply chain,” it said.

“However, the Board believes that Mr. Calhoun’s primary focus on safety, quality and transparency is exactly what Boeing has needed, and continues to need.”