Boeing CEO Ousted
Boeing President and CEO Harry Stonecipher has been forced to resign because of an improper relationship with a female executive at the aircraft manufacturer.
The surprise ouster made the 69-year-old executive the second consecutive CEO to resign from the Chicago-based defense contractor in disgrace.
His predecessor, Phil Condit, resigned Dec. 1, 2003, as a result of the defense contracting scandals that ultimately sent two Boeing executives — ex-Air Force procurement official Darleen Druyun and chief financial officer Mike Sears — to jail.
Chief financial officer James A. Bell, 56, was named president and CEO on an interim basis.
Boeing said an internal investigation prompted by information sent anonymously to chairman Lew Platt and the company's legal and ethics leaders 10 days ago revealed a "consensual" relationship between Stonecipher and the female executive that the board determined was in violation of the company's code of conduct.
"The board concluded that the facts reflected poorly on Harry's judgment and would impair his ability to lead the company," said Platt, who is to assume an expanded role at the company.
He said the requested resignation "was in no way related to the company's operational performance or financial condition, both of which remain strong."
Spokesman John Dern said the female executive, who was not identified, did not report to Stonecipher and remains with the company. He declined to provide further details.
Boeing has been struggling with a spate of ethical lapses related to defense contracts.
On Friday, the Wall Street Journal reported, the Air Force dropped a ban that had barred Boeing from bidding on satellite-launch contracts. The ban was imposed because Boeing had illegally obtained confidential information from rival Lockheed Martin.
The newspaper said that in exchange for lifting the ban, Boeing is required to provide assurances it is acting ethically each time it bids on a government contract worth more than $500 million.
Stonecipher also was dismissed from Boeing's board, which he had been a member of since joining the company from McDonnell Douglas when the two companies merged in 1997.
The tough-talking son of a Tennessee coal miner, Stonecipher had been credited with helping Boeing to clean up its ethical behavior and with improving its sullied reputation in Washington. The company's stock surged 52 percent during his tenure.
He also is one of its largest stockholders as a result of the McDonnell Douglas deal.
Stonecipher failed, however, to win back the tainted $23 billion air-refueling tanker contract that the Pentagon pulled from Boeing because of conflict-of-interest violations involving Druyun and Sears.
He turns 70 in May and had been expected to retire sometime next year.