PARIS (Reuters) - Airbus (AIR.PA) is close to naming an outsider to replace finance chief Harald Wilhelm after board moves to overhaul top management in response to a corruption probe hastened his surprise resignation in May, people close to the matter said.
British and French authorities are investigating the use of middlemen in jetliner sales and the European planemaker says it is also supplying information to U.S. authorities.
Wilhelm, 52, who is not due to leave Airbus until next year, has not been accused of wrongdoing, two people familiar with the investigation said.
Indeed, he initiated the planemaker’s decision in 2014 to rip up a decades-old system of middlemen supporting jet sales, opening the door to British and French investigators.
Wilhelm’s departure is the most striking evidence yet of a board-driven clearout designed to help Airbus win more lenient judicial settlements by presenting a completely fresh face to anti-fraud agencies, four people familiar with the matter said.
Airbus declined to comment on management changes, while Wilhelm also declined to comment. Airbus has said it reported its own concerns over the past use of intermediaries to British authorities in 2016 and that it is co-operating with all pending investigations.
Although Airbus abolished a system of political balance between its host states among its top management some years ago, the board will nominate a new German finance chief from outside the group in coming weeks, reflecting a desire to still balance French and German executives, two of the people added.
Wilhelm said in May he would leave Airbus in 2019, dashing plans for a staggered succession after CEO Tom Enders steps down in April. Airbus said at the time he had decided to leave “in agreement with the board of directors”, without giving a reason.
It also praised the record of Wilhelm, who has spent 18 years in finance roles at Airbus. He had been expected to stay longer and had sought confirmation from the board over his future, two people familiar with the matter said.
However, only days before the announcement Wilhelm learned that the board wanted him to leave at the same time as Enders, so that Airbus could mark a clean break, they added.
“The board panicked. They handled this very badly,” a person familiar with the discussions said. Asked about such criticism, a spokesman said neither Airbus nor its board had any comment.
As CFO from 2012, Wilhelm automatically became co-chairman of a panel that ultimately approved payments to agents, five sources said. The German CFO increasingly asked questions about the longstanding system of payments and after a series of audits, he halted them altogether in 2014.
Although he had no role in the handling or recruitment of agents or “business partners”, Wilhem’s position on the obscure “Company Development and Selection Committee” left him vulnerable to broader pressure for a clearout of managers from an increasingly skittish board, the sources said.
The upheaval of the investigations into Airbus has barely disturbed a record run in its share price to around 100 euros, but Wilhelm’s exit dismayed some investors, who made their concerns known at the top of the company.
The previously unreported circumstances surrounding Wilhelm’s departure highlight the unpredictable and continuing fallout from the compliance probe, which has coincided with a string of management departures since it began in 2016.
The board’s decision over Wilhelm mirrored growing signals that only a complete makeover would allow Airbus to win settlements surrounding the Anglo-French investigation.
In a 2017 landmark ruling that is still being digested, a British judge offered engine maker Rolls-Royce (RR.L) a settlement involving a fine rather than criminal charges for allegedly paying bribes, saying it was a “dramatically changed organisation” with a new board and new executive team.
Under Britain’s fledgling U.S.-style system of deferred prosecution agreements, the ruling demonstrated that firms may avoid prosecution and get discounted fines if they thoroughly overhaul leadership teams and show “extraordinary cooperation”.
Several sources say Wilhelm’s shock departure sowed internal fears of a broader “witch hunt” in the hopes of winning such a deal, with staff at every level being interviewed by lawyers.
Enders, who himself faces investigation over an Austrian fighter deal but denies wrongdoing, rejects any witch hunt is taking place at Airbus, which has new compliance rules, and has said its ability to compete depends on a change of culture.
Even so, some executives have voiced concerns that distractions over probes and industrial snags are nibbling away at Airbus’s standing with airlines as its U.S. rival Boeing (BA.N) wins more orders.
“This whole environment is also very visible to our customers who are very vocal about their own frustrations,” then sales boss Eric Schulz said in a June memo seen by Reuters.
Reporting by Tim Hepher; Editing by Adrian Croft and Alexander Smith