Boeing Adds to Duberstein’s Duties Ahead of Investor Vote
Boeing Co. (BA) is adding to the duties of independent lead director, Ken Duberstein, as it seeks to head off a proposal to split the roles of chief executive officer and chairman that investors will vote on in two weeks.
The move follows discussions with shareholders and is ahead of its annual meeting set for April 29, the Chicago-based company said today in a regulatory filing.
Duberstein will now approve board meeting agendas and schedules as well as the type of information provided for the meetings; preside at some meetings; be a liaison between the chairman and the directors; be available for direct communication with shareholders; and call board meetings when necessary.
Boeing had sought to block a vote on a plan submitted by shareholder Ray Chevedden to strengthen oversight by splitting the combined roles currently held by Jim McNerney. The U.S. Securities and Exchange Commission said Jan. 29 the company couldn’t exclude the proposal from its proxy.
The shareholder proposal calls for an independent director to chair Boeing’s board instead of the CEO and cited McNerney’s service as Procter & Gamble Co. (PG)’s lead director and his membership of International Business Machines Corp.’s board as potential distractions from his work at Boeing.
Chevedden reiterated his concerns in a letter to the SEC on Jan. 16, the day regulators worldwide began grounding Boeing’s 787 Dreamliner to investigate battery faults. Boeing has since completed testing of a proposed redesign of the batteries and is awaiting regulators’ approval for flights to resume.
The Dreamliner was plagued by seven delays during its development and was more than three years behind schedule when it entered service in late 2011.
The amendment to Duberstein’s duties moves the lead director’s position from an advisory role to one that gives express approval in certain areas, John Dern, a Boeing spokesman, said in an e-mail today.
“The changes are meant to assure shareholders that Boeing’s lead director role is a strong one and that our board structure provides independence, accountability and alignment with shareholder interests,” Dern said.
McNerney, 63, joined Boeing’s board in 2001 and has been chairman and CEO since 2005. Duberstein, 68, who has served on Boeing’s board since 1997, was a chief of staff to former President Ronald Reagan before founding Washington lobbying firm Duberstein Group Inc.
Shareholders rejected a similar proposal in 2011, with 35 percent of votes cast for the proposal versus 64 percent against and less than 1 percent abstaining, according to an SEC filing.
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