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EADS overhauls management structure

After much speculation, shareholders of Franco-German aerospace group EADS have finally decided to do away with the company’s complex dual management structure. EADS will now be led by a single chairman and chief executive. Rüdiger Grube will become sole chairman, and Louis Gallois sole chief executive.

Thomas Enders, formerly the company’s German co-chief executive, will become chief executive of EADS’ Airbus subsidiary. Airbus had been headed by Gallois, who was at that time also French co-chief executive.

The company has also decided to increase its number of independent directors, and to this end DaimlerChrysler, EADS’ major German shareholder, and Sogeade, a French holding company, will each relinquish two seats on the board. At the next shareholder meeting the board will propose the election of four independent directors. This will leave DaimlerChrysler and Sogeade with two board representatives each. Aside from the chief executive, the board will no longer contain executive members.

The editorial in the Financial Times (17 July) said that while the changes do not represent the major reform called for by French president Nicolas Sarkozy, they are a pragmatic compromise that could bring EADS closer to normal commercial practice.

August 2007