Boeing needs a radical board shake-up to regain its altitude
Last fortnight, Boeing’s airline customers sent two clear messages when they asked to meet with the planemaker’s directors without its chief executive officer David Calhoun. The first was that they had lost confidence in Calhoun and his deputies. No matter where you fall on the organization chart, it’s never a good sign when a client wants a tête-à-tête with your boss and doesn’t invite you along.
The board clearly received that message: Last Monday, Boeing said that Calhoun would exit by the end of the year and that Stan Deal, head of the commercial airplanes division, would retire immediately. The other big message had to do with the board itself. By summoning the company’s directors, the airline CEOs were signalling that at the heart of the Boeing mess they see a huge governance problem—that the company’s issues, whether quality or culture or strategy or leadership, all fall squarely on the board, which needs a meaningful overhaul.
Again, Boeing’s directors got the message. The company announced that Chairman Larry Kellner would not stand for re-election at its annual meeting in May. He will be succeeded by Steve Mollenkopf, the former Qualcomm CEO who joined the board in 2020, which gives him some distance from the 737 Max crashes in 2018 and 2019 that killed a total of 346 people.
Even the way the executive shuffle was handled showcased just how ill prepared, complacent and out of touch the board was. Despite all the scrutiny that the management team faced, the board did not have a successor ready to jump in for Calhoun or even for its troubled commercial unit. It pushed longtime executive Stephanie Pope into the unenviable job.
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