IATA: Arab carriers call for greater transparency

Singapore
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In a dramatic early session of the annual general meeting, IATA stood accused of appearing to be "run for the few, by the few" as it came under fire from a group led by the Gulf carriers over a lack of transparency. The result was a highly unusual secret ballot, which was only narrowly defeated.

Qatar Airways chief executive Akbar Al Baker sparked both debates. First, he questioned the auditing process for IATA's 2010 financial statement, and then the "surprise" nomination of Etihad boss James Hogan to fill the extra seat created to broaden the representation of carriers from Middle East.

Al Baker highlighted some of IATA's expenditure, including $18 million on travel, $58 million on data processing and IT and $29 million on outsourcing and consultancy. He called upon IATA to justify "such large sums spent on travel" and the processes by which consultant and outsourcing contracts were awarded.

IATA's chief financial officer Ayaz Hussain partially addressed the issues raised over the auditing of the financial statement, but Wasantha Kumarasiri, chief executive of Air Niugini, proposed that IATA reconsider the appointment of its auditors, a motion which was seconded by Al Baker.

However this was not the end of the debate, as the original plan to use a show of hands "for expediency" was challenged by Emirates Airline president Tim Clark, who was concerned that such a process would be "very complicated and time-consuming". International Airlines Group chief executive Willie Walsh also sought clarity on the voting procedure and the result was a secret ballot, with British Airways and Qatar Airways nominated as observers for the count.

Regarding the nomination of Hogan, Al Baker told the AGM: "We believe such issues should not be surprises. Firstly, such decisions should be transparent and secondly, if geographical representation is the basis of the composition of the board, the airlines involved should be informed in advance of their regional allotments so that they can co-ordinate who should represent them."

The debate about broader board representation was taken up by Air Niugini's Kumarasiri, who called for more engagement with the smaller airlines in IATA.

And this prompted a very direct appeal from Emirates' Clark: "Clearly there is the view that this is an entity that is run for the few by the few, and that has to end," he said. "You must, in the view of Emirates, open up the dialogue far morewe need to see action."

The debates created an unusual a level of tension during the normally carefully orchestrated morning sessions. It even prompted a comment from Gulf Air boss Samer Majali when paying tribute to Giovanni Bisignani as his term as director general comes to an end: "It seems the winds of change in the Middle East have reached Singapore," he said.

When asked about the issues raised during the session, Bisignani said: "This is a transparent association," but added: "The world has changed and this means the association must change, in a certain way."