Prior to the approaching annual shareholders meeting on April 18, 2023, Boeing's Board of Directors released a proxy statement outlining the company's 2022 financial results, including the compensation given to its chief executives. Lawrence Kellner, an independent chair of Boeing, began the statement with the following: "In 2022, we continued to make great progress in ensuring that our culture, procedures, and systems always match the highest standards. We are overcoming the difficulties of recent years, de-risking our business, and regaining the operational and financial strength you expect from Boeing despite challenging macroeconomic conditions. Kellner emphasized that the company's net cash flow ultimately became positive in 2022.
Safety is still the top priority, and Boeing has taken steps to further reinforce its safety culture and fulfill its commitments to those who depend on the security of its products, according to Kellner. It was the first time the manufacturer recorded a positive net flow since 2018 because of Calhoun's ability to steer the company toward the desired outcome. The CEO did not put the 777X into service before the end of 2023, hence he was not eligible for a supplement award. But, one of the objectives was the 777X's successful introduction into service and production/delivery ramp-up by December 31, 2023, according to the announcement. It is obvious that this objective won't be achieved, despite the fact that Mr. Calhoun has little control over the situation.
The Board acknowledges and greatly appreciates Mr. Calhoun's leadership and many actions over the last three years to navigate through a constantly changing environment to best position the Company for the future, and without regard for the impact his decisions may have had on goals that were set prior to the widespread onset of COVID and the c-word. The safe return to service of the 737 MAX-7 and MAX-10 aircraft, the realignment of engineering functions, a crewed Starliner flight, objectives associated with the defense programme, and the accomplishment of the Boeing Global Services (BGS) long-range business are additional objectives Calhoun is to accomplish by the end of 2023.
Moreover, Calhoun was tasked with leading and meeting targets for a partnership with Brazilian aircraft maker Embraer. Embraer's failure to "satisfy the relevant conditions" was the reason given by Boeing for terminating the contract in April 2020. These objectives were set when Calhoun was appointed in 2020, and the grant date value of these performance-based Restricted Stock Units (RSU), a type of stock-based remuneration given to workers of a corporation, was greater than $7 million. His $1.4 million base compensation was unaltered in 2022, but the Compensation Committee decided in February 2023 to increase Calhoun's annual incentive target from $2.8 million to $3.4 million. As Muilenburg failed to successfully reintroduce the 737 MAX, the company's best-selling product, into service following the groundings in March 2019, Calhoun succeeded Muilenburg as CEO of Boeing in January 2020. In December 2020, Muilenburg was let go.