Regulatory Governance, Managerial Decision- Making, and Safety Failure: The Boeing 737 Max Case

Introduction. The Boeing 737 MAX crisis offers a paradigmatic case study in the governance of private and public sector relationships in safety-critical industries. This article examines how the Federal Aviation Administration’s progressive delegation of certification authority to Boeing, through the Organisation Designation Authorisation (ODA) programme, created structural conditions for regulatory and managerial failure. These conditions contributed to two fatal accidents in 2018 and 2019. Drawing on institutional theory, principal–agent frameworks, and organisational safety literature, the article analyses four interconnected dimensions of governance failure: the institutional design of the certification system; the informational asymmetries and incentive misalignments that shaped managerial decision-making; the governance of automation as a socio-technical challenge; and the contextual financial consequences of sustained governance failure.

Aim of the study. The article argues that the MAX crisis was not primarily a product of individual misconduct or isolated engineering error. Rather, it resulted from organisational and institutional structures that systematically discouraged transparency, independent oversight, and safety-first decision-making.