Boeing’s largest shareholder, the Vanguard Group Inc which currently holds a 7.1% stake in the U.S. plane maker, has made public its concerns over Boeing management’s handling of the grounding of the 737 MAX and that its fund managers have become “very concerned” regarding oversight failures in light of the two recent fatal 737 MAX crashes.
According to the Financial Times, the British newspaper has had sight of a letter written by Vanguard’s head of portfolio company engagement, analysis and voting, W. Robert Main III, in which he stated that Vanguard had “engaged with Boeing leadership and directors to convey our concerns.” Main also wrote that: “In our role as shareholders, we expect companies to effectively oversee the materials risk of their business, adding: ”In Boeing’s case, our expectation is that Boeing Leadership, including its Board of Directors, closely monitoring and maintaining the safety of its aircraft.”
Since the two crashes, several advisory groups have been pressing for a management shake-up at Boeing, including the removal of CEO Dennis Muilenburg as Board Chairman. One of the most critical people has been Ralph Nader whose grandniece was killed in the Ethiopian Airlines crash in March and who has personally written Vanguard’s CEO Mortimer Buckley urging him to push for an investigation into “management misdeeds” and to “make sure Boeing management takes its responsibility seriously. While Vanguard have kept details of the correspondence confidential, Mr. Main confirmed that Vanguard frequently investigates incidents that “put the health and safety of consumers at risk, or [which] threaten to disrupt confidence in an industry.”
Boeing has stated that it has finished the anti-stall software ‘fix’ to ensure the plane is safe to fly, but the jet’s return to service will likely be delayed for quite some time while Boeing answers several questions from the U.S. Federal Aviation Administration.
