Shareholder Resolution and Supporting Statement

WHEREAS: Increases in executive compensation outpace employee wage increases. Base pay of CEOs accelerated 6.1% in 1998, while overall U.S. wages and benefits climbed 3.5%.

• According to The Wall Street Journal's annual Executive Pay survey (04/06/00) "salaries and bonuses of surveyed CEOs jumped 11%" in 1999, surpassing "the 4.2% uptick in pay among white-collar employees." The same study showed that the salary and bonus for our CEO, Philip M. Condit, was $4,257,900. Meanwhile, total shareholder return of Boeing stock for the past 5 years as compared to our industry was -10.1. Business Week's April 17, 2000, Executive Compensation Scoreboard listed Boeing next to the bottom among its aerospace peers in 1997-99 analysis of pay vs. corporate profit.

• While the company's performance recently witnessed a turnaround, its previous two years' performance sent the stock sliding. This took place during a time when our company was challenged about social issues domestically and internationally. According to The Wall Street Journal (May 1, 2000) Boeing's $50 million advertising campaign was meant to enhance its corporate image "in large part . . . at its own 190,000 workers, many of them disillusioned after labor friction, production problems and waves of internal upheavals in recent years." The company refused to support shareholder resolutions in 1998 and 1999 calling for adherence to basic human rights at its own operations in China. In its February 25, 2000 Annual Report on Human Rights, the U.S. State Department criticized China for a "marked deterioration in human rights." According to The New York Times (Feb. 1, 2000), Beijing has stepped up its intimidation against Catholic clergy loyal to the Pope and has destroyed church buildings.

• Shareholders need to be vigilant and challenge executive pay packages that reward poor social or financial corporate performance, asking themselves: if top officers' pay for a given year should be reduced if the company suffers from poor corporate citizenship that harms our corporate image, such as costly fines, protracted labor tensions, poor image related to lobbying on behalf of corrupt governments, or significant loss of market share to the likes of Airbus.

• Surveys conducted and released by Boeing in 1999 show notable drops in employees' confidence that the company is making changes necessary to compete successfully, and that their jobs are secure (WSJ 05/01/00).

• IBM reported to shareholders how it integrates such factors into its compensation packages, understanding the need to balance social criteria with fiscal concerns.

RESOLVED: Shareholders request the Board to institute a special Executive Compensation Review to find ways to link compensation of its key executives not only with fiscal performance but to social corporate performance as well. This shall include, but not be limited to, the company's efforts to promote basic human rights domestically and internationally within its operations. It shall also include a comparison of the compensation packages for company officers with the lowest paid company employees in the U.S. and around the world. This review's results shall be made available to requesting shareholders by September 1, 2002.

The Compensation Committee of the Board, which consists of five non-employee, independent directors, oversees all the Company's executive compensation programs. The Compensation Committee already provides a report to shareholders, which explains the criteria for CEO and executive officer compensation. As explained in that report, the goals of the Company's integrated executive compensation programs are to attract, retain and motivate a high caliber executive leadership team, align executive compensation with shareholder interests, link pay to Company and individual performance, and achieve a balance between incentives for short-term and long-term performance.

The Compensation Committee plays a key oversight role in ensuring that the Company's executives live up to the Company's commitment to being a good global citizen. The Company recognizes that, in addition to delivering solid, sustained financial performance, it must be a socially responsible corporate citizen, both domestically and internationally. Good Corporate Citizenship is a value embedded in Boeing's 2016 Vision Statement and has been integrated into many of the Company's assessment and development tools. In addition, specific performance criteria for the president of each operating group address how the group is performing with respect to diversity. The Company is also committed to promoting the rule of law and showing respect for employees and their rights of association and assembly wherever we operate in the world. The Company is sensitive to issues of individual rights and environmental degradation in other countries where it does business.

The Board agrees that executive compensation must be closely scrutinized--precisely the function performed by independent directors of the Compensation Committee. The Board believes, therefore, that the time, effort and expense necessary to complete the special review and produce the report requested are not justified.