Elliott Investment Management (Elliott), the activist investor that has swooped in and taken around 11% stake in 
Southwest Airlines
, fulfilled its promise and has called a special meeting to remove eight members of the current board of directors and, potentially, by extension, its chief executive officer (CEO).
Southwest Airlines’ unfulfilled potential
In a statement on October 14, Elliott said that after exhaustive attempts to persuade Southwest Airlines’ management to implement the necessary executive changes, the investor has called the Special Meeting, which was scheduled to occur on December 10.
The purpose of the meeting will be to give shareholders the opportunity to elect the “independent, best-in-class slate of director nominees.”
“Absent a thorough reconstitution of its Board, the story of Southwest will remain one of empty promises and unfulfilled potential.”
Photo: Ian Dewar Photography | Shutterstock
Elliott’s eight nominees include former C-level executives from Ryanair
, Virgin America, 
Air Canada
, WestJet
, and other aviation and non-aviation C-level managers from various companies and governmental agencies.
However, when Elliott initially announced its candidates to take over the board of Southwest Airlines in August, its list included Nancy Killefer, a former McKinsey Senior Partner, and Eash Sundaram, the former chief digital and technology officer of JetBlue
.
The list published on October 14 does not include Killefer or Sundaram. Furthermore, Elliott has yet to call for the removal of Rakesh Gangwal or Robert Fornaro, two new board members, from their current positions.
Related
Southwest Airlines Appoints Former Spirit Airlines CEO Robert Fornaro To Board Of Directors
This was the second new addition to Southwest Airlines’ board in the past few months.
No more broken promises
While now, Elliott has not directly said that it would seek to replace the current president and CEO of Southwest Airlines, Bob Jordan, in the past, the investment firm has questioned whether the leader who delivered years of unacceptable financial results was the right person to lead the carrier amidst its transformation plans.
The investment firm’s vote in December included a proposal to remove Gary Kelly, chairman of the board and former CEO of Southwest Airlines, who said he would retire after the airline’s annual meeting in May 2025.
Photo: Carlos E. Santa Maria | Shutterstock
That round of criticism was launched following Southwest Airlines’ investor day on September 26, where the airline launched or explained in-depth its new initiatives that would hopefully restore the carrier’s financial well-being.
“Following Elliott’s public push for changes, Southwest has responded with a series of long-overdue strategic and corporate-governance initiatives, promising that better performance will follow.”
Elliott has continued to call these initiatives “broken promises,” saying that the carrier’s shareholders could not afford another failed turnaround, which was why Southwest Airlines needed an experienced board to lead the company.
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Southwest Will Keep Bags Flying Free As Part Of New “Even Better” Plan
The plan also includes partnerships with international airlines, starting with Icelandair.
Keeping its promises
With the call of a special meeting and a vote to remove eight members of the current board of Southwest Airlines, Elliott has kept its promise to initiate the move in September.
Much like back then, the company reiterated its calls for shareholders to ensure that they can use their shares to vote during meetings, with Elliott warning that Southwest Airlines has already provided several false record dates in anticipation of the activist investor’s intentions to call a meeting.
Photo: Port of Oakland
Elliott announced that it began accumulating an economic interest in Southwest Airlines in June, which has resulted in a months-long saga that has included poison pills, board member changes, new revenue initiatives, and contradictory statements about a dialogue between the two.
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Southwest Airlines’ New $2 Billion Investor Wants Big Changes
If it were to come to fruition, Elliot Investment Management would become the largest institutional shareholder in Southwest Airlines.