Boeing, the multinational aerospace corporation, issued a statement on Friday clarifying that their CEO Dave Calhoun will not be receiving a $7 million bonus. This is due to the CEO’s inability to fulfill the objective of introducing the Boeing 777X into operation by the conclusion of 2023.
When Dave Calhoun took over as the CEO of Boeing in January 2020, he was eligible for a performance-based incentive of up to $7 million. This incentive was tied to the company’s goal of getting the Boeing 777X aircraft into service by the end of 2023.
Along with objective of entering 777X aircraft into service, Dave Calhoun was supposed to achieve seven milestones by the end of this year.
As per a company filing posted on Friday ahead of a shareholder meeting on April 18, Boeing’s compensation committee decided in August 2022 that CEO Dave Calhoun would not receive a performance-based incentive as it became evident that he would not be able to meet the target of launching the 777X by 2023.
Boeing’s much-awaited aircraft, the 777X, has experienced significant delays in its launch date. Originally scheduled to enter service in 2020, the launch of the 777X has been pushed back several times as it faced several setbacks in the certification process of its wide body 777X aircraft, resulting in delays to the planned launch date. In 2022, the company announced that the first delivery of the 777X would be pushed back to 2025, primarily due to issues with the aircraft certification timeline.
Boeing has been working on the 777X for years, with the aim of offering the world’s largest twin-engine jetliner with improved fuel efficiency and other advanced features. However, the project has faced several setbacks, including engine-related issues and production problems.
Compensations received by Dave Calhoun in 2021 and 2022
Dave Calhoun received a total compensation of $22.5 million in 2022, up from about $21 million the previous year, according to a company filing. His compensation for last year included $7 million in pay and a long-term incentive that has not yet vested.
In February 2023, Boeing awarded Calhoun an incentive of around $5.3 million, made in restricted stock units that vest in 2024 and 2025, to encourage him to stay with the company during its anticipated recovery period.
Sabrina Soussan – New member on Board of Directors
Boeing has nominated Sabrina Soussan to be elected as a new director in the upcoming annual meeting of shareholders. Soussan, who currently serves as the Chair and CEO of SUEZ SA, a global utility company based in Paris would become the eighth independent director to join the board if her nomination is approved on April 18.