'Another year's pay': So, why is the Qantas share price surging 3%?

Are investors celebrating the Qantas chair's resignation?

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This morning, we covered some big news regarding the Qantas Airways Limited (ASX: QAN) share price.

As we discussed at the time, the Qantas chair Richard Goyder has just resigned, albeit with an effective date of the airline's annual general meeting (AGM) in 2024. His resignation comes after weeks of pressure on the Qantas leadership team as a result of its battered reputation resulting from months of scandals and customer complaints.

This latest exit comes after the abrupt early retirement of controversial former Qantas CEO Alan Joyce last month. Two other Qantas board members in Jacqueline Hey and Maxine Brenner have also announced their departures, which will take place next February. This will follow the imminent departure of another board member – Michael L'Estrange – following Qantas' AGM next month.

Qantas itself has acknowledged that the hit it has taken to its reputation and brand is behind these departures, stating that the board cleanout is being conducted "in recognition of the reputational issues facing the group and to support restoration of trust in the company".

The remaining Qantas board members, including the newly appointed CEO Vanessa Hudson, will have their reappointments voted on by shareholders next month at the AGM.

Why is the Qantas share price flying high today then?

Yet amid the news of chair Goyder's resignation today, the Qantas share price is surging. Qantas shares closed at $4.90 each yesterday. But as of the time of writing, the airline is trading at $5.05. That's up a healthy 3.06% for the session thus far.

Perhaps investors are excited at the thought of Richard Goyder staying on as chair for another 12 months. That's with Goyder collecting another year's worth of pay in the process, of course.

Union leaders aren't too fond of Goyder, to put it kindly. That can likely be put down to his endorsement of Qantas' decision to sack (illegally, as it turned out) 1,700 workers at the airline. Not to mention his leadership role at Qantas while the airline was embroiled in scandal.

As reported in The Australian today, Transport Workers Union secretary Michael Kaine stated that, "Former CEO Joyce did very little right in his tenure at Qantas, but the one thing he did do was take an early exit and Goyder should follow him".

The Australian Licensed Aircraft Engineers Association also piled on, saying that "[Goyder's] performance did not warrant a 12-month farewell tour".

But perhaps shareholders are more forgiving of Goyder, judging by today's share price movements. Alternatively, they could well be celebrating Goyder's eventual removal. Even if it will take another year to finalise.

Whatever the reason for today's Qantas share price optimism, no doubt investors will welcome it. However, the airline still remains down almost 25% from its July highs of above $6.50 a share. Qantas has also lost a nasty 15.3% over 2023 to date.

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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