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James McNerney

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James McNerney
McNerney speaking at the Department of State Global Business Conference in 2012
Born (1949-08-22) August 22, 1949 (age 74)
Providence, Rhode Island, U.S.
EducationYale University (BA) in American Studies
Harvard University (MBA)
TitleCEO, Chairman and President of The Boeing Company
Term2005–2015
PredecessorHarry Stonecipher
SuccessorDennis Muilenburg
Signature

Walter James "Jim" McNerney Jr.[1] (born August 22, 1949) is a business executive who was President and CEO of The Boeing Company from June 2005 to July 2015. McNerney was also Chairman from June 2005 until March 1, 2016.[2][3][4] McNerney oversaw development of the Boeing 737 MAX.[5]

Education

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McNerney was born in Providence, Rhode Island. He graduated from New Trier High School in Winnetka, Illinois in 1967.[6][7] He attended Yale University, receiving a B.A. degree in 1971. While at Yale, he was a member of the Delta Kappa Epsilon fraternity and excelled in baseball and hockey. After graduating from Yale, he worked for a year at both British United Provident and G.D. Searle, LLC. He then attended Harvard Business School, receiving a Master of Business Administration in 1975.[8]

Career

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McNerney began his business career at Procter & Gamble in 1975, working in brand management.[9] He worked as a management consultant at McKinsey from 1978 to 1982.

McNerney joined General Electric in 1982. There, he held top executive positions including president and CEO of GE Aircraft Engines and GE Lighting; president of GE Asia-Pacific; president and CEO of GE Electrical Distribution and Control; executive vice president of GE Capital; and president of GE Information Services. McNerney competed with Robert Nardelli and Jeff Immelt to succeed the retiring Jack Welch as chairman and CEO of General Electric. When Immelt won the three-way race, McNerney and Nardelli left GE (as was Welch's plan); McNerney was hired by 3M in 2001. The From 2001 to 2005, McNerney held the position as chairman of the board and CEO of 3M. Former 3M employees stated that a business practice introduced by McNerney was "a creativity killer" and, in discussing the lack of innovation at 3M, that McNerney's influence had lingering effects on the company.[10]

McNerney is currently the President, Chairman, and CEO of United States Equestrian Team Foundation[11] and was presented with the R. Bruce Duchossois Distinguished Trustee Award in 2024.[12]

Boeing

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On June 30, 2005, Boeing hired McNerney as the chairman, President, and CEO. McNerney oversaw the strategic direction of the Chicago-based aerospace company with a focus on spending controls.[13]

Barack Obama in conversation with James McNerney, Jr. at the 2011 APEC CEO Summit
Barack Obama in conversation with James McNerney, Jr. at the 2011 APEC CEO Summit

As Boeing's first CEO without a background in aviation, he made the decision to upgrade the 737 series to 737 MAX instead of developing a new model.[5][14] According to the Seattle Times, McNerney made the decision to "establish[] a plant in North Charleston, S.C., attempting to bust Puget Sound unions — who were responsible for saving the much-delayed airliner. Later all Dreamliners assembly shifted there, where there have been ongoing production flaws." [15] The National Labor Relations Board filed a complaint alleging "Boeing's decision to transfer a second production line for its new 787 Dreamliner passenger plane to South Carolina was motivated by an unlawful desire to retaliate against union workers for their past strikes in Washington and to discourage future strikes."[16] The complaint was later withdrawn as part of a settlement.[17]

In the New York Times, writer Bill Saporito said, "Mr. McNerney’s decision meant rushing development of the 737 Max while managing the Federal Aviation Administration so that the certification of the redesigned jet — whose engines had been physically moved forward — would not require retraining of pilots, thus saving customers time and money."[18] This "contributed to the two fatal crashes in 2018 and 2019 that prompted the 737 Max’s grounding for nearly two years." Other articles allege that "Boeing engineers contended their power and decision-making ability often was overridden by cost-conscious executives, including McNerney, in recent decades."[19][20][21]

Compensation

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In 2007, as CEO of Boeing, W. James McNerney Jr. made $12,904,478 in total compensation, which included a base[22] salary of $1,800,077, a cash bonus of $4,266,500, options granted of $5,871,650, and Other $966,251.[23]

In 2008, his total compensation increased to $14,765,410, which included a base salary of $1,915,288, a cash bonus of $6,089,625, and options granted of $5,914,440.[24]

In 2009, his total compensation decreased to $13,705,435, which included a base salary of $1,930,000, a cash bonus of $4,500,300, stock options granted of $3,136,251, stock granted of $3,136,242, and other compensation totaling $1,002,642.[24]

In 2013, McNerney made $23.2 million in total compensation, which included a $1.9 million salary, $3.7 million stock award, $3.7 million stock option grant, and an annual incentive bonus of $12.8 million.[25]

In 2014, as Chairman and CEO of Boeing, McNerney made $29 million in total compensation.[26] Of the total: $2,004,231 was received as a salary; $14,400,000 was received as an annual bonus and a three-year performance bonus;[26] $6,272,517 was awarded as stock (none was received in stock options); and other compensation totaling $760,000.[26][27]

Positions

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McNerney has been a member of the Boeing board of directors since 2001. He is also a member of the board of directors of Procter & Gamble and IBM.

McNerney served as Chairman of The Business Council in 2007 and 2008.[22] He is a current member of the Northwestern University Board of Trustees, is a Trustee at the Center for Strategic and International Studies[28] and was appointed as Chairman of the President's Export Council by President Barack Obama.[29]

In December 2016, McNerney joined a business forum assembled by then president-elect Donald Trump to provide strategic and policy advice on economic issues.[30]

Career path

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Job Tenure Company Position
1975–1978 Procter & Gamble Brand Manager
1978–1982 McKinsey & Company Senior Project Manager
1982–1988 GE Mobile Communications General Manager
1988–1989 GE Information Services President
1989–1991 GE Financial Services and GE Capital Executive Vice President
1991–1992 GE Electrical Distribution and Control President and CEO
1993–1995 GE Asia-Pacific President
1995–1997 GE Lighting President
1997–2000 GE Aircraft Engines President and CEO
2000–2005 3M President and CEO
2005–2015 The Boeing Company Chairman, President, and CEO

References

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  1. ^ Adams, Marilyn (February 26, 2007). "Straightened up and flying right". USA Today. Retrieved July 15, 2012.
  2. ^ "Boeing Holders Vote on CEO-Chairman Split Amid 787 Woes". Bloomberg.
  3. ^ "Boeing replaces CEO McNerney with Muilenburg". CNBC. June 23, 2015.
  4. ^ "Muilenburg Elected Chairman of Boeing Board of Directors".
  5. ^ a b Daily Beast: "How Boeing’s Bean-Counters Courted the 737 MAX Disaster"; By Clive Irving ; 09 June 2019.
  6. ^ "The Hard Work In Leadership". BusinessWeek. Archived from the original on December 19, 2007. Retrieved September 30, 2007.
  7. ^ "Lofty expectations await Boeing CEO". Crain's Chicago Business. Archived from the original on December 10, 2012. Retrieved September 30, 2007.
  8. ^ Strahler, Steven R. (July 4, 2005). "Lofty expectations await Boeing's CEO; McNerney a boost to faded civic arena.(W. James McNerney Jr. appointed as chairman and chief executive officer)". Crain's Chicago Business.
  9. ^ Steady Hand, Aviation Week & Space Technology, 170, 24 (June 15, 2009), p. 78
  10. ^ Keilman, John (October 5, 2023). "The Long Dry Spell at One of America's Most Innovative Companies". The Wall Street Journal. Retrieved April 18, 2024.
  11. ^ "Trustees & Staff". USET Foundation. Retrieved April 28, 2024.
  12. ^ Release, Press; Odell, Skye (January 26, 2024). "W. James McNerney, Jr. Honored With R. Bruce Duchossois Distinguished Trustee Award". HorsesDaily. Retrieved April 28, 2024.
  13. ^ Bloomberg Businessweek: "Former Boeing Engineers Say Relentless Cost-Cutting Sacrificed Safety"; By Peter Robison ; 08 May 2019.
  14. ^ Scott Hamilton (October 7, 2019). "Pontifications: Muilenburg's departure wouldn't go far enough". Leeham News.
  15. ^ Talton, Jon (April 7, 2023). "Boeing isn't a bank, but it's the ultimate 'too big to fail' company". Seattle Times. Retrieved April 18, 2024.
  16. ^ Greenhouse, Steven (April 20, 2011). "Labor Board Tells Boeing New Factory Breaks Law". New York Times. Retrieved April 18, 2024.
  17. ^ Hananel, Sam. "Labor board drops high-profile Boeing complaint". Boston.com. Archived from the original on September 28, 2015. Retrieved April 18, 2024.
  18. ^ Saporito, Bill (January 23, 2024). "Boeing Made a Change to Its Corporate Culture Decades Ago. Now It's Paying the Price". New York Times. Retrieved April 18, 2024.
  19. ^ Fedor, Liz (February 1, 2024). "What the Boeing debacle teaches us about company culture and the tension between safety and profits". MinnPost. Retrieved April 18, 2024.
  20. ^ Tkacik, Maureen (March 28, 2024). "Suicide Mission: What Boeing did to all the guys who remember how to build a plane". The American Prospect. Retrieved April 18, 2024.
  21. ^ Dodds, Io (April 17, 2024). "'The decisions you're making are going to end with a smoking hole in the ground': Inside the Boeing catastrophe". The Independent. Retrieved April 18, 2024.
  22. ^ a b The Business Council, Official website, Background Archived March 3, 2016, at the Wayback Machine
  23. ^ 2007 CEO Compensation for W. James McNerney Jr Archived January 17, 2014, at the Wayback Machine, Equilar.com
  24. ^ a b "Equilar – 404". equilar.com. Archived from the original on January 17, 2014. Retrieved June 24, 2015.
  25. ^ USA Today: "Compensation for Boeing CEO McNerney soars in 2013"; by Gary Strauss; 14 March 2014.
  26. ^ a b c "Boeing CEO's compensation $29M, including $14M bonuses"; by Dominic Gates; 13 March 2015. The Seattle Times.
  27. ^ Salary.com: "2014 Boeing executive compensation for W. James McNerney". Accessed 7.17.2015.
  28. ^ "Board of Trustees". Archived from the original on December 28, 2012. Retrieved January 30, 2014.
  29. ^ Carney, Timothy (2011-04-24) Boeing lives by big government, dies by big government Archived May 22, 2011, at the Wayback Machine, Washington Examiner.
  30. ^ Bryan, Bob (December 2, 2016). "Trump is forming an economic advisory team with the CEOs of Disney, General Motors, JPMorgan, and more". Business Insider. Retrieved June 1, 2017.

Further reading

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  • Robison, Peter (2021). Flying Blind: The 737 MAX Tragedy and the Fall of Boeing (Hardcover). New York: Doubleday. ISBN 978-0385546492.
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