OP-ED: Boeing may have killed people – but here’s why it won’t be going down By Francis Herd
An Ethiopian Air flight went down on 10 March. The first time the Boeing CEO was willing to admit that the plane’s flight control system was a factor in the crash was three weeks later, when a preliminary report was released.
The use of phrases like “chain of events” and a “high workload environment” is a clear attempt to distance the company from taking full legal responsibility for what happened. Given that MCAS is so clearly involved, why play such games? It is one of the ethical questions of our time. Insurance contracts may exclude payments when companies admit liability, putting CEOs in difficult positions. Boeing has already been slapped with lawsuits and it may be found guilty anyway. By fighting the suits rather than apologising and opening its pockets for victims without coercion, it may be holding out in the hope that legal findings will stop short of full blame. It doesn’t want to incriminate itself in the meantime.
Of the 5,000 737 Max 8s on order, only 50 had been cancelled, which is amazing too. If airlines feel these planes are profitable and the software problem can be fixed, they may be loath to cancel their orders. There is a backlog of orders for similar-sized planes from Airbus, so it could lead to unwanted delays in deliveries.
All this goes against the grain of crisis management theory that suggests that the rational response to a crisis of this seriousness and magnitude is humility and honesty. The argument is that companies will do well to apologise early if they are to blame and immediately take steps to compensate victims; to show that they can fix the problem and make it right. A bad response can compound the damage to a brand if the company is seen as an unrepentant bully and ultimately censured by the courts.
They reached out to doctors and hospitals, set up toll-free hotlines for customers and engaged regularly with journalists. When the US government later passed regulations to protect consumers from tampering, the company went over and above these requirements, adding extra protection to their packaging.
Later there was an apology campaign, but there were always signs that the BP CEO Tony Hayward — who famously cried “I want my life back!” to a journalist at the height of the spill — was bent on concealing the true extent of the problems at BP. He had been behind cost-cutting measures in the years before the spill.
To make matters worse, there is also mixed evidence about how much punishment BP actually received. It was forced to establish a $20-billion repair fund. At one point in 2010, it had lost 50% of its market capitalisation, but the losses started to reverse in November of that same year. The long-term impact on the company is debatable and there have been conflicting studies.
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