SkyWest Airlines, Inc. is a North American regional airline headquartered in St. George, Utah,[1] flying to 159 cities in 40 U.S. states, 6 Canadian Provinces, and 1 city in Mexico. The airline serves as a feeder airline, operating under contract with various major carriers. It flies as SkyWest Airlines in a partnership with AirTran Airways,[2] United Express on behalf of United Airlines and as Delta Connection on behalf of Delta Air Lines.
SkyWest Airlines is one of two airlines owned by SkyWest, Inc. (the other being Atlantic Southeast Airlines). Combined the two airlines make up the tenth-largest airline in terms of number of planes, operating 440 regional aircraft[citation needed].
As of 2010, SkyWest employs over 11,000 people throughout North America. The airline operates 1,750 departures a day, with 1,197 operating as United Express, 522 operating Delta Connection and 31 as AirTran Airways. In total, SkyWest carried 24.3 million passengers in 2010.
Statement on Corporate Governance at Skywest
This statement reports on Skywest’s key governance framework, principles and practices. These principles and practices are reviewed regularly and revised as appropriate to reflect changes in law and good practice in corporate governance.
ASX Principles of Corporate Governance
Skywest must comply with the laws of Singapore, the Corporations Act 2001 (Cwth) (“Corporations Act”), the Australian Securities Exchange (“ASX”) Listing Rules (“ASX Listing Rules”), other Australian securities laws, the Alternative Investment Market (“AIM”) Listing Rules, other UK securities laws and any other required listing rules.
ASX Listing Rule 4.10.3 requires ASX listed companies to report on the extent to which they have followed the Corporate Governance Principles and Recommendations (“ASX Principles”) published by the ASX Corporate Governance Council. The ASX Principles require the Board to consider the development and adoption of appropriate corporate governance policies and practices founded on the ASX Principles.
Compliance with ASX Principles of Good Corporate Governance
Details of Skywest’s compliance with the ASX Principles are set out below. A checklist, cross referencing the ASX Principles to the relevant paragraphs below, is provided in the final section of this statement. Skywest notes that it is reporting against the August 2007 version of the ASX Principles.
Board Functions
The board seeks to identify and satisfy the expectations of its shareholders, as well as other regulatory and ethical expectations and obligations. In addition, the board is responsible for identifying areas of significant business risk and ensuring arrangements are in place to adequately manage those risks.
To ensure that the board is well equipped to discharge its responsibilities it has established guidelines for the nomination and selection of directors and for the operation of the board. The responsibility for the overall operation and administration of the Group is delegated by the board to the Executive Chairman and the executive management team, with the CEO (Mr Shelton) and the other members of the executive management team being responsible for various aspects of the day to day operations of the Group. The board ensures that these people are appropriately qualified and experienced to discharge their responsibilities and has in place procedures to assess the performance of the Executive Chairman and the executive management team.
Whilst at all times the board retains full responsibility for guiding and monitoring the Group, in discharging its stewardship it makes use of sub-committees. Specialist committees are able to focus on a particular responsibility and provide informed feedback to the board.
To this end, the board has established the following committees:
Audit
Nomination
Remuneration
The roles and responsibilities of these committees are discussed throughout this corporate governance statement.
The board is responsible for ensuring that management’s objectives and activities are aligned with the expectations and risks identified by the board. The board has a number of mechanisms in place to ensure this is achieved, including:
the board’s approval of a strategic plan designed to meet shareholders’ needs and manage business risk.
Ongoing development of the strategic plan and approving initiatives and strategies designed to ensure the continued growth and success of the Group.
Implementation of budgets by management and monitoring progress against budget - via the establishment and reporting of both financial and non-financial key performance indicators.
Management of senior executives.
Other functions reserved to the board include:
Approval of the annual and half-yearly financial reports.
Approving and monitoring the progress of major capital expenditure, capital management, and acquisitions and divestitures.
Ensuring that any significant risks that arise are identified, assessed, appropriately managed and monitored.
Reporting to shareholders.
Key operation risks:
Fluctuations in commodity prices, exchange rates & demand volumes.
Political instability/sovereignty risk in some operating sites.
The occurrence of force majeure events by significant suppliers.
Increasing costs of operations, including labour costs.
Changed operating, market or regulatory environments as a result of climate change.
Underpinning Skywest's risk management efforts is a comprehensive set of policies and procedures directed towards achieving the following objectives in relation to the requirements of Principle 7:
Effectiveness and efficiency in the use of Skwyest's resources.
Compliance with applicable laws and regulations.
Preparation of reliable published financial information.
Retention
MEDICAL BENEFITS
Medical Insurance
All full-time SkyWest employees have the opportunity to select a health plan from at least two options.
Dental Insurance
Dental insurance is available for all full-time employees. The dental coverage includes an extensive network of providers. Participating employees are not required to coordinate benefits through a primary care provider before receiving services.
125 Flexible Spending Plan
The 125 Flexible Spending Plan provided by SkyWest offers full-time employees two types of flexible spending accounts: a medical account and a dependent day care account. These accounts help employees to reduce their taxable income by setting a portion of their pay aside on a pre-tax basis for certain medical, dental, vision, or dependent care expenses.
Vision Plan
The vision plan offered by SkyWest provides full-time employees with discount eye care and a nationwide network of optometrists, opthamologists, and opticians as well as the nation's leading optical retailer, LensCrafters. The plan also offers discounts on LASIK and PRK procedures.
PLANNING FOR THE FUTURE
RETIREMENT SERVICES
401(k) Retirement
The 401(k) Retirement Plan SkyWest offers a very competitive 401(k) plan to both full-time and part-time employees. The plan includes PRE TAX payroll deductions with an employer dollar for dollar match based on years of service. The plan, including any company contributions, is immediately 100% vested. Employees can choose to invest in more than 20 different funds and multiple Target Date Funds.
Performance Rewards
Implemented in 2005, Performance Rewards is an innovative program that allows employees to share in the Financial and Operational success of the Company.
423 Employee Stock Purchase Plan
The 423 Employee Stock Purchase Plan provides SkyWest employees with the opportunity to buy SkyWest, Inc. common stock through payroll deductions. SkyWest pays the fees on the purchase, and employees receive a 5% discount when the stock is purchased every six months. Full and part-time employees are eligible to participate in the plan.
529 Educational Savings Plan
SkyWest offers a program to assist employees in saving for educational costs for themselves, their children, or grandchildren. This flexible 529-college savings program allows employees to save through payroll deductions on an after-tax basis for college expenses. Full and part-time employees are eligible to paricipate in the plan.
Travel Benefits:
New hire flight attendants will receive unlimited free space available travel privileges on SkyWest airlines after 14 days of employment based on the new hires date of hire. Flight attendants also receive exceptional travel benefits with most major carriers based on space available travel and other applicable policies.
Employees, spouses or domestic partners, eligible dependent children, and parents of employees have unlimited space-available travel privileges on SkyWest's vast route system; based on the new hire's date of hire, as well as substantially reduced fares with most other carriers. In addition, discounts are available for cruises, hotels, car rentals, theme parks, and many other travel related opportunities.
SkyWest Airlines is one of two airlines owned by SkyWest, Inc. (the other being Atlantic Southeast Airlines). Combined the two airlines make up the tenth-largest airline in terms of number of planes, operating 440 regional aircraft[citation needed].
As of 2010, SkyWest employs over 11,000 people throughout North America. The airline operates 1,750 departures a day, with 1,197 operating as United Express, 522 operating Delta Connection and 31 as AirTran Airways. In total, SkyWest carried 24.3 million passengers in 2010.
Statement on Corporate Governance at Skywest
This statement reports on Skywest’s key governance framework, principles and practices. These principles and practices are reviewed regularly and revised as appropriate to reflect changes in law and good practice in corporate governance.
ASX Principles of Corporate Governance
Skywest must comply with the laws of Singapore, the Corporations Act 2001 (Cwth) (“Corporations Act”), the Australian Securities Exchange (“ASX”) Listing Rules (“ASX Listing Rules”), other Australian securities laws, the Alternative Investment Market (“AIM”) Listing Rules, other UK securities laws and any other required listing rules.
ASX Listing Rule 4.10.3 requires ASX listed companies to report on the extent to which they have followed the Corporate Governance Principles and Recommendations (“ASX Principles”) published by the ASX Corporate Governance Council. The ASX Principles require the Board to consider the development and adoption of appropriate corporate governance policies and practices founded on the ASX Principles.
Compliance with ASX Principles of Good Corporate Governance
Details of Skywest’s compliance with the ASX Principles are set out below. A checklist, cross referencing the ASX Principles to the relevant paragraphs below, is provided in the final section of this statement. Skywest notes that it is reporting against the August 2007 version of the ASX Principles.
Board Functions
The board seeks to identify and satisfy the expectations of its shareholders, as well as other regulatory and ethical expectations and obligations. In addition, the board is responsible for identifying areas of significant business risk and ensuring arrangements are in place to adequately manage those risks.
To ensure that the board is well equipped to discharge its responsibilities it has established guidelines for the nomination and selection of directors and for the operation of the board. The responsibility for the overall operation and administration of the Group is delegated by the board to the Executive Chairman and the executive management team, with the CEO (Mr Shelton) and the other members of the executive management team being responsible for various aspects of the day to day operations of the Group. The board ensures that these people are appropriately qualified and experienced to discharge their responsibilities and has in place procedures to assess the performance of the Executive Chairman and the executive management team.
Whilst at all times the board retains full responsibility for guiding and monitoring the Group, in discharging its stewardship it makes use of sub-committees. Specialist committees are able to focus on a particular responsibility and provide informed feedback to the board.
To this end, the board has established the following committees:
Audit
Nomination
Remuneration
The roles and responsibilities of these committees are discussed throughout this corporate governance statement.
The board is responsible for ensuring that management’s objectives and activities are aligned with the expectations and risks identified by the board. The board has a number of mechanisms in place to ensure this is achieved, including:
the board’s approval of a strategic plan designed to meet shareholders’ needs and manage business risk.
Ongoing development of the strategic plan and approving initiatives and strategies designed to ensure the continued growth and success of the Group.
Implementation of budgets by management and monitoring progress against budget - via the establishment and reporting of both financial and non-financial key performance indicators.
Management of senior executives.
Other functions reserved to the board include:
Approval of the annual and half-yearly financial reports.
Approving and monitoring the progress of major capital expenditure, capital management, and acquisitions and divestitures.
Ensuring that any significant risks that arise are identified, assessed, appropriately managed and monitored.
Reporting to shareholders.
Key operation risks:
Fluctuations in commodity prices, exchange rates & demand volumes.
Political instability/sovereignty risk in some operating sites.
The occurrence of force majeure events by significant suppliers.
Increasing costs of operations, including labour costs.
Changed operating, market or regulatory environments as a result of climate change.
Underpinning Skywest's risk management efforts is a comprehensive set of policies and procedures directed towards achieving the following objectives in relation to the requirements of Principle 7:
Effectiveness and efficiency in the use of Skwyest's resources.
Compliance with applicable laws and regulations.
Preparation of reliable published financial information.
Retention
MEDICAL BENEFITS
Medical Insurance
All full-time SkyWest employees have the opportunity to select a health plan from at least two options.
Dental Insurance
Dental insurance is available for all full-time employees. The dental coverage includes an extensive network of providers. Participating employees are not required to coordinate benefits through a primary care provider before receiving services.
125 Flexible Spending Plan
The 125 Flexible Spending Plan provided by SkyWest offers full-time employees two types of flexible spending accounts: a medical account and a dependent day care account. These accounts help employees to reduce their taxable income by setting a portion of their pay aside on a pre-tax basis for certain medical, dental, vision, or dependent care expenses.
Vision Plan
The vision plan offered by SkyWest provides full-time employees with discount eye care and a nationwide network of optometrists, opthamologists, and opticians as well as the nation's leading optical retailer, LensCrafters. The plan also offers discounts on LASIK and PRK procedures.
PLANNING FOR THE FUTURE
RETIREMENT SERVICES
401(k) Retirement
The 401(k) Retirement Plan SkyWest offers a very competitive 401(k) plan to both full-time and part-time employees. The plan includes PRE TAX payroll deductions with an employer dollar for dollar match based on years of service. The plan, including any company contributions, is immediately 100% vested. Employees can choose to invest in more than 20 different funds and multiple Target Date Funds.
Performance Rewards
Implemented in 2005, Performance Rewards is an innovative program that allows employees to share in the Financial and Operational success of the Company.
423 Employee Stock Purchase Plan
The 423 Employee Stock Purchase Plan provides SkyWest employees with the opportunity to buy SkyWest, Inc. common stock through payroll deductions. SkyWest pays the fees on the purchase, and employees receive a 5% discount when the stock is purchased every six months. Full and part-time employees are eligible to participate in the plan.
529 Educational Savings Plan
SkyWest offers a program to assist employees in saving for educational costs for themselves, their children, or grandchildren. This flexible 529-college savings program allows employees to save through payroll deductions on an after-tax basis for college expenses. Full and part-time employees are eligible to paricipate in the plan.
Travel Benefits:
New hire flight attendants will receive unlimited free space available travel privileges on SkyWest airlines after 14 days of employment based on the new hires date of hire. Flight attendants also receive exceptional travel benefits with most major carriers based on space available travel and other applicable policies.
Employees, spouses or domestic partners, eligible dependent children, and parents of employees have unlimited space-available travel privileges on SkyWest's vast route system; based on the new hire's date of hire, as well as substantially reduced fares with most other carriers. In addition, discounts are available for cruises, hotels, car rentals, theme parks, and many other travel related opportunities.
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