Glass Lewis, a leading proxy advisory firm, has recommended that investors vote against three Boeing directors, including CEO David Calhoun, at the upcoming annual meeting on April 27th. The firm cited concerns about the company’s handling of the 737 Max crisis and its overall governance practices as reasons for the recommendation.
The 737 Max crisis, which stemmed from two fatal crashes in 2018 and 2019 that resulted in the grounding of the aircraft worldwide, has been a significant blow to Boeing’s reputation and financial standing. Glass Lewis noted that the company’s response to the crisis was slow and inadequate, leading to questions about its leadership and decision-making processes.
In addition to the 737 Max crisis, Glass Lewis also raised concerns about Boeing’s governance practices, including the lack of diversity on its board of directors and the company’s failure to hold executives accountable for their role in the crisis. The firm criticized the board for not taking more decisive action to address these issues and for failing to provide adequate oversight of management.
Glass Lewis specifically recommended voting against Calhoun, who has been CEO of Boeing since January 2020. The firm cited his role in the company’s response to the 737 Max crisis and his oversight of the board as reasons for its recommendation. In a statement, Glass Lewis said, “We believe that a change in leadership is necessary to restore investor confidence in Boeing and ensure that the company is able to navigate the challenges it faces in the coming years.”
Boeing has faced significant criticism in recent years for its handling of the 737 Max crisis and its overall corporate governance practices. The company has made some changes to its board and management team in response to these concerns, but investors and proxy advisory firms like Glass Lewis continue to call for further action to address the issues at the company.
In response to Glass Lewis’ recommendation, Boeing issued a statement saying, “We take the concerns raised by Glass Lewis seriously and are committed to addressing them in a timely and transparent manner. We are confident that our board and management team are taking the necessary steps to improve our governance practices and restore investor confidence in Boeing.”
It remains to be seen how investors will respond to Glass Lewis’ recommendation at the upcoming annual meeting. However, the firm’s call for change at Boeing reflects the growing pressure on the company to address its governance issues and rebuild its reputation in the wake of the 737 Max crisis.