Leaders of companies with a recent history of scandal have a special obligation. They are obligated – or they should be – to lead their companies ethically as well as effectively.
Companies that fall into this category are, for example, Volkswagen. Its reputation was badly tarnished eight years ago when it came to light that it had long installed in its vehicles a defeat device, or “cheat device,” deliberately intended to mislead on emissions. Also Wells Fargo, some of whose executives are only now paying for their roles in a scandal that burst into the open in 2016, when the bank was revealed to have created millions of fake accounts not for the benefit of its customers but for the benefit of Wells Fargo. And, more dramatically, Boeing, when two of its 737 MAX airliners crashed within five months of each other (in 2018 and 2019), killing 346 people.
What happened at Boeing was not only the most dramatic of the corporate scandals, but it was also the most tragic. In direct if inadvertent consequence of what happened at Boeing, and did not happen, hundreds of people died.
Peter Robison wrote the definitive account of the causes and effects of the two crashes, Flying Blind: The 737 MAX Tragedy and the Fall of Boeing. His conclusion was that the Federal Aviation Administration had “abdicated much of its oversight to Boeing itself.” And, even more disturbingly, that the culture at Boeing had “rotted.” That under then CEO Dennis Muilenburg, “Boeing had reinvented itself into one of the most shareholder-friendly creatures of the market. It celebrated managers for cost cutting, co-opted regulators with heaps of money, and pressured suppliers with Walmart-style tactics.”*
Given this dismal recent history one would think that Boeing’s current leadership team – every member of Boeing’s board and every one of Boeing’s top leaders and managers – would be especially alert to anything that smacked of carelessness, casualness, or callousness. Anything that did not convey the message both to those inside the company and to those without, that whatever the mistakes management made in the recent past the present would be different. In the present Boeing would be above reproach.
No such luck. I was astonished last week to read in the Wall Street Journal that Boeing’s two top executives were apparently oblivious to the mood of the moment. Apparently unaware of the temper of the times in which workplace issues – especially, post-Covid, the issue of hybrid work – were front and center. The Journal does not normally dig up dirt on America’s corporate elite. I surmise then that the editors found this story irresistible, or egregious, or both.
Boeing’s Chief Executive Officer, David Calhoun, started to work from home during the pandemic. The problem is he never stopped. He simply did not return to the office, continuing instead to work from one of his two homes, either his “sprawling waterfront house” on a lake in New Hampshire, or his other house “in a gated South Carolina resort community.” According to records obtained by the Journal, to accomodate Calhoun Boeing’s fleet of private jets made more than 400 trips to or from airports near his homes in the last three years. Not a good look.
Similarly, Boeing’s Chief Financial Officer, Brian West, who also does not usually go to Boeing’s headquarters, now located in Arlington, Virginia. Instead, West needs just five minutes to get from his home in New Canaan, CT to a small, newly opened Boeing office – which just happens to be also in New Canaan.
None of this would matter so much if we were not now consciously post-Covid. Now not in a time during which Boeing is itself urging its workforce to get back to the office. Some of its employees are back in the office full time; others are permitted to work remotely or to go hybrid, into the office some days, work from home the others.
The Journal article was just that, it was an article about Boeing, it was not an editorial. Still, the piece was opinionated, strongly opinionated. It pointed out that while it was not unheard of for a CEO to live and work remotely, far from the office, it was unusual. It quoted a management professor saying that Calhoun and Davis were clearly “out of step with the general messaging from corporate America,” which was encouraging everyone to get back to the office. And it pointed out that Boeing was also an outlier among its peers – for example, the CEO of rival Airbus regularly worked from the company’s headquarters in Toulouse.
“People are pissed they’re being told to get their butts to the office,” said a union official representing some of Boeing workers. No wonder. Their boss is working from home while many of them are not. Their boss is earning $22 million a year – any of them doing the same?
Shame on Boeing’s board for tolerating leaders who do not labor every day, in every way to restore the company’s honor. Shame on Boeing’s leaders for doing less than their best to boost the company they purportedly represent.
“People are pissed”? Really? The wonder is they are not more pissed than they are.
*Doubleday, 2021, p. 6