A pair of influential proxy advisory firms have come out against members of Boeing's (NYSE:BA) board, urging shareholders to vote against directors in response to the company's handling of the 737 MAX grounding.
Institutional Shareholder Services and Glass Lewis, two firms that specialize in advising large holders on how to vote on corporate matters, have targeted individual directors ahead of Boeing's April 27 annual meeting. Glass Lewis is recommending shareholders vote against chairman Larry Kellner, a former commercial airline CEO who previously headed the board's audit committee.
ISS, meanwhile, targeted longtime directors Arthur Collins, Edmund Giambastiani, Susan Schwab, and Ronald Williams, all of whom have been with the company since the beginning of the 737 MAX development process. Neither advisory firm targeted Boeing CEO David Calhoun, a longtime director who was put in charge of the company in December after the board fired CEO Dennis Muilenburg.
The Wall Street Journal first reported the recommendations.
On Monday, Boeing will hold its annual meeting using a virtual format. The company has faced a difficult last 12 months, dealing first with the March 2019 grounding of the 737 MAX, which led to an investigation into the company that revealed lax internal controls. More recently, Boeing has been trying to manage a COVID-19 pandemic-fueled slump in new plane orders, which is expected to cause airlines to defer or cancel billions of dollars worth of new planes.
Boeing over the weekend also terminated a planned $4 billion acquisition of a controlling stake in the commercial business of Embraer, a move that preserves cash in the short term but could lead to litigation risk, and a hole in its new plane portfolio, for years to come.
Two Boeing directors, Edward Liddy and Mike Zafirovski, stepped down earlier this year.