IATA: Airline CEOs call for change in SITA governance

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Leading airline CEOs made an unexpected call during the working session at the IATA AGM for SITA to restructure how it is governed.

Speaking from the floor, IAG chief executive Willie Walsh said there are concerns that the current structure is “overly complex”.

Walsh says a number of airlines, including IAG, EgyptAir, Saudia, Qatar Airways and Emirates, were calling for the review. They have produced a white paper calling for reform at SITA to be presented at its Annual General Assembly in Brussels on 18 June.

“SITA is primarily a not-for-profit organisation which has a requirement to provide value to shareholders and it would be natural for those shareholders to have a key role in the strategic development and goal setting of SITA,” says Walsh.

“The overwhelming majority of those shareholders are members of this association. Since SITA’s formation in 1949 it has seen its governance change on a number of occasions, most recently in 2011. Also in 2011 it was agreed that there could be a comprehensive review of governance to take place at the AGM in 2014.

“I believe it’s fair to say that a number of shareholder airlines are concerned that the current structure and governance is overly complex and does not ensure the full oversight and empowerment and control by the shareholders of the strategic direction of SITA,” says Walsh.

“We have proposed a motion at the SITA Annual General Assembly [later this month] calling for a full review of SITA’s governance to ensure the proper oversight by the shareholders of the strategic direction and I would be pleased to make this white paper available to members at their request.”

AGM president and Qatar Airways chief executive Akbar Al Baker echoed the comments made by Walsh. “Moreover, SITA increased in value during the able leadership of Francesco Violante, and hence according due attention to its governance is a priority for all the airlines,” said Al Baker.

“I see this as a positive signal from the airlines as it demonstrates the value of SITA as a key asset for the air transport community,” SITA’s chief executive Francesco Violante told Flightglobal here in Doha.

“It is important for our airline shareholders to be more involved in SITA’s governance and I know this topic will be part of the Council and board agenda,” says Violante.