According to a regulatory filing on Friday, Boeing’s outgoing CEO, Dave Calhoun, received $33 million in total compensation for 2023.
This represents a 45% increase from the previous year despite the company grappling with a severe safety crisis that has sent its stock plummeting.
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- Boeing’s departing CEO, Dave Calhoun, received $33 million in total compensation for 2023, a 45% increase from 2022, despite the company’s safety crisis.
- Much of Calhoun’s pay is in deferred stock that has lost value due to Boeing’s falling share price after the recent mid-air incident on a 737 MAX jet.
- Boeing has revamped its executive compensation to prioritize safety and quality metrics, but some shareholders question whether such measures should have been implemented earlier.
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Boeing CEO’s $33 Million Payday Raises Eyebrows Amid Safety Crisis.
The Controversial Payout
Calhoun’s pay package has drawn criticism, especially given the recent incidents that have tarnished Boeing’s reputation.
In January, a mid-air panel blowout on an Alaska Airlines 737 MAX 9 jet sparked concerns from regulators and customers about the company’s quality control measures.
As a result, Boeing’s shares have tumbled nearly 30% this year.
Breaking Down the Compensation
Boeing’s CEO, Calhoun, currently has a total compensation of $33 million, but most of this consists of deferred stock that has decreased in value due to safety issues.
The company has adjusted his 2023 pay to an estimated value of $24.8 million, which includes an actual income of $5 million.
Calhoun has declined his $2.8 million bonus.
Potential Retirement Payout
The filing also reveals that Calhoun’s potential retirement payouts were valued at more than $44 million as of the end of 2023.
This comes after he announced his plans to step down as CEO by the end of the year amid broader management challenges facing the company.
Safety and Quality Prioritized
In response to the crises, Boeing has revamped its executive compensation policies to emphasize product safety and quality.
For 2024, safety and quality metrics will account for 60% of annual incentives for commercial airplanes, compared to 40% for financial performance.
Long-term incentive awards will also include new safety-related metrics, such as mandating an employee culture survey to assess safety management.
Shareholder Criticism
Despite these efforts, some shareholders remain skeptical.
Rosanna Weaver of As You Sow, a shareholder advocacy organization, stated that while rewarding safety is a positive step, such measures should have been in place “in the first place.”
As Boeing works to regain public trust and address its safety concerns, the compensation of its top executives will likely remain a subject of intense scrutiny.
The company’s new leadership must navigate this challenging landscape and demonstrate a genuine commitment to prioritizing safety over financial gains.
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