Airbus asks CEO to stay, faces rift with Spain on board

Company has tried to demonstrate political independence from its founding nations

Airbus Group ended the suspense over the future of its chief executive on Wednesday, saying its board had asked German-born Tom Enders to serve for at least one more term after his mandate expires in 2016.

Chairman Denis Ranque announced the move at the start of an annual shareholder meeting marked by continuing efforts by the planemaker to demonstrate political independence from its founding nations while trumpeting European integration.

Mr Enders, who has led an overhaul in the Franco-German-led company's structure, has been running the world's second-largest aerospace group behind Boeing since 2012.

Wednesday’s meeting was expected to feature a tussle between Airbus and the Spanish government over the choice of a new board member, in a new test of Enders’ efforts to free the 15-year-old parent group from political influence.

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Airbus Group, whose shareholders include the Spanish, French and German governments, was due to ask shareholders to approve the appointment of former IBM executive Maria Amparo Moraleda Martinez to replace Josep Pique i Camps, who is standing down.

But the Spanish government has written to the company to put forward the name of Belen Romana, former head of Spain’s ‘bad bank’ Sareb, company officials said.

While Airbus maintains a board slot for Spain, the Madrid government no longer has the right to directly appoint its board representative, who is now designated as an independent under corporate governance changes negotiated in 2012.

But the debate could strain relations between Airbus and Madrid during a sensitive time for the troubled A400M military aircraft project, which is based in Seville.

It could also put France and Germany on the spot to decide whether to support Spain’s request under an understanding between state shareholders to safeguard each other’s interests.

Such a common front could, for example, involve blocking separate proposals by Airbus Group to make itself a “European company” in a mainly symbolic change of legal status designed to underline European integration and smooth union representation.

Airbus sparred with Paris over the choice of chairperson in 2013, forcing the French government’s candidate Anne Lauvergeon to settle for a board seat as a guardian of French defence interests. Spain does not have an equivalent role on the board.

Amparo Moraleda was nominated after Airbus Group brought in headhunters, in an effort to mark a visible break with a previous system of political appointments.

Spain owns 4.1 per cent of Airbus Group through state holding company SEPI.

Madrid, which has long sought to improve its status in Airbus, is seen as anxious to maintain a strong foothold in the company through a board member enjoying government confidence.

Reuters