Boeing plunges, but its CEO wants a 45% increase

Boeing plunges, but its CEO wants a 45% increase
Boeing plunges, but its CEO wants a 45% increase

David Calhoun could see his compensation for 2023 jump to $32.8 million, despite a year marked by technical incidents and substantial financial losses for Boeing. This amount represents a 45% increase from the previous year, when he collected $22.8 million.

A controversial salary increase

The details of this compensation include a base salary of $1.4 million and stock awards amounting to approximately $30 milliona decision taken by the board of directors despite the company’s mixed performance.

This notable increase comes in a context where Boeing posted losses of nearly $4 billion in the first quarter, mainly due to the tearing off of a door on an Alaska Airlines 737 MAX, leading to a series of investigations and financial compensation. Incidents have also affected other models, such as the 787 and 777, previously known for their reliability.

Boeing in the doldrums

David Calhoun’s compensation is being criticized even more as ISS, a major shareholder advisory agency, recommended a rejection of this proposal during the general meeting of May 17. The agency criticizes in particular the increase linked to seniority and the excessive expenses for the use of private jets, estimated at $515,000 annually, an amount well above the average of S&P 500 executives.

Approval of Calhoun’s compensation will depend on votes from major shareholders, including fund managers Vanguard, Newport and BlackRock, who play a leading role in Boeing’s internal politics. This vote comes as Calhoun announced plans to step down later this yearleaving behind a company grappling with security and financial stability challenges.

While Boeing is trying to restore its image, in particular by announcing an improvement in financial results in 2023 compared to previous years and a record number of orders for commercial jets in December, the question of the remuneration of its executives remains a sensitive subject. It reflects the tensions between the need to maintain attractive incentives for senior management and the need for accountability to stakeholders and public opinion, especially in a context where passenger safety and aircraft reliability are at stake.

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