Does Boeing’s Executive Compensation Plan include Safety Goals ?

bOEING sAFETY cULTURE?
Share this article: FacebooktwitterlinkedinFacebooktwitterlinkedin

Safety must be Boeing’s TOP PRIORITY

Article on Company Executive Compensation focuses on $$$

Not mention whether Executives’ Rewards tied to SAFETY PERFORMANCE

 

The average ordinary consumer as well as the airline executives, who actually buy their products, know that the Boeing Company’s primary focus MUST BE SAFETY in the design, manufacture and continuing airworthiness of its products. Reminders of the  headlines and of the company’s self-declared mandate to make the quality of their aircraft its #1 priority:

 

More Questions About Boeing’s Quality Systems

Should/Can The FAA Modify The Boeing ODA???

***Boeing: Change Of General Manager Of The Max 8 Production= Less Lean, More Safety?

Boeing Adds Some Safety Talent.

Boeing Board Says SAFETY; Will It Do SMS?

Update On FAA’s And Boeing’s Remedial Actions On Aircraft Certification

‘It’s More Than I Imagined’: Boeing’s New C.E.O. Confronts Its Challenges

***Does Boeing’s Lean Manufacturing Drive Need Some SMS Balancing

President & CEO Calhoun SAFETY CULTURE AT BOEING NEEDS A TOP-TO-BOTTOM INSTALLATION

The Absent, Critical Point In The Boeing Chief Engineer Stories

Ms. Pasztor Is The New Boeing Person In Charge Of Its Safety Culture

What The Boeing Special Airplane Design And Process Committee Review Said

Boeing Quality Transformation- Less Human Touch But Greater QA

With that history, it is curious that the below article only discusses the sizes of CEO’s and senior executives’  total compensation package. Maybe the writer was overwhelmed by the Annual Report and Proxy Statement, a combined 279 dull pages written in the obscure jargon of SEC accountants. Perhaps the writer’s focus was obfuscated  by the abundance of financial information and in particular, the calculation of the Equity compensation plans, Stock options, Deferred Compensation Plan, Annual Incentive Plan, Executive Supplemental Savings Plan, Executive Layoff Benefits Plan, and Non-Qualified Stock Option (Part IV. p.107-111) The attractive financial rewards are IMPRESSIVE.

What goals trigger these executive payments? At best, it is revealed that “value of the stock awards depends upon the future performance of the company and the share price.”

CALHOUN

In the text section of the Annual Report, CEO Calhoun makes the following statements:

Annual Report p.1

We made significant strides toward strengthening our safety culture, investing in our talent and instilling renewed discipline and rigor throughout our operations

p.1-2

Rebuilding Trust We profoundly committed to regaining the trust of our customers, regulators, investors and other key stakeholders through transparency, integrity and delivering on what we promise. With an unwavering dedication to safety, our 737 program teammates have been working around the clock globally to support our customers as they return airplanes back to service. Regulators in 185 out of 195 countries—including China, Ethiopia and Indonesia—have allowed the 737 MAX to resume service or fly within its airspacesms

 

Commitments, unless connected to the Boeing executive performance evaluations, are not as compelling in assuring that SAFETY is their #1 PRIORITY.

 

Maybe the compensation plans include objective indicia for this vital aspect of Boeing’s future with its customers and its regulators. The Department of Justice has placed significant expectations on the company’s strict adherence to the highest levels of safety[1]. Hopefully, FAA senior management is aware of the degree of inculcation of risk minimization in all levels of the Boeing organization-BOEING EMPLOYEES

For the last 3 years the press has been all over every Boeing error; their scrutiny has been microscopic on all aspects of the business. QUERY – where have these investigative journalists been in following the money?

INCENTIVES


March 13, 2022 11:54 AM UPDATED AN HOUR AGO

Boeing CEO has $7 million on the line to ship 777X next year

CALHOUN

Here’s why the jet maker’s directors chose not to give Boeing CEO Dave Calhoun the first half of his controversial signing bonus when he became eligible last month.

(Bloomberg) — Boeing Co. Chief Executive Officer Dave Calhoun hasn’t pocketed any of a controversial $7 million signing bonus, even though the planemaker reached a key goal: returning the 737 Max to service in much of the world.

The company’s directors chose not to give Calhoun the first half of the incentive when he became eligible last month, according to a regulatory filing Friday. That’s because Boeing is still a long way from reaching other targets, like flying the Starliner spacecraft to orbit with people on board and certifying the twin-aisle 777X, which is three years behind schedule.

If the goals aren’t “substantially achieved” by the end of 2023, Calhoun will forfeit the grant.

It was awarded when he joined the company as CEO in early 2020, as Boeing reeled from the grounding of its Max after two fatal crashes, and sparked criticism in Congress.

Even without the perk, he collected a total compensation package of $21.1 million last year.

The Chicago-based company also bumped up his bonus by $860,000 to $3.4 million in reward for “inculcating robust safety and quality management systems.”

[1] Deferred Prosecution Agreement with the U.S. Department of Justice…agreement also requires that we review our compliance program and undertake continuous improvement efforts with respect to it, and implement enhanced compliance reporting and internal controls mechanisms.” Annual Report p. 118

boeing ANNUAL REPORT



 

Share this article: FacebooktwitterlinkedinFacebooktwitterlinkedin

Be the first to comment on "Does Boeing’s Executive Compensation Plan include Safety Goals ?"

Leave a comment