Since 1908, when Lt. Thomas Selfridge achieved the regrettable distinction of becoming powered flight's first fatality following the crash of a Wright Model A airplane during a flying demonstration for the U.S. Army at Fort Myer, Va., safety has been the aerial pursuit's foremost priority.
It is drummed into the conscience of every pilot and maintenance tech from the moment training begins, and has culminated in aviation being one of the most scrutinized activities in human history - not to mention the safest form of mass transportation in the modern era. That this relentless monitoring occurs both externally by mandate of various aviation authorities and internally as a voluntary commitment by all categories of operators, from private pilots to business flight departments, the airlines and military aviation branches, is a testament to the aviation community's dedication to safe operations.
For several decades, safety auditing has been a keystone of the monitoring process. This has included periodic - and often unannounced - regulatory audits of commercial operators by aviation authorities as well as voluntary process audits by third-party companies specializing in the activity. During the past 20 years, a proliferation of audits, auditors and safety standards has blanketed the industry.
This became a problem among the airlines in the 1980s and 1990s as carriers formed interlining/code-sharing alliances (when they couldn't merge outright) in the quest for dominating their respective markets. To assure equivalent safety levels, everyone was auditing everyone else according to a plethora of widely varying standards, with some carriers undergoing such evaluations almost continuously. If an airline had 15 code-sharing arrangements, it had to audit all 15 of its partners - and each of them had to audit it - all with consequent expense in terms of personnel workload, loss of productivity and auditing fees. To add this burden, audit results weren't being shared, resulting in an unnecessary redundancy of audits.
Eventually, the carriers appealed to the(IATA) to establish a common standard for audits and auditors, and this led to formulation of the IATA Operational Safety Audit, or IOSA. Now, a carrier could be audited once annually according to a universally accepted set of standards and the results of the examination shared throughout the industry via a secure IATA-maintained registry.
Part 135 Charter Operators:Same Problem
A situation similar to that formerly confronting the airlines now exists in the business jet charter segment - FAR Part 135 air charter operations in the United States and equivalent activity in other countries - where varying auditing and operational standards and a phalanx of third-party auditors have become focused on the industry. A spate of charter aircraft accidents - the result of icing, CFIT, maintenance lapses, improper loading, inexperienced and ill-trained flight crews, among other things - have helped spur users to vet charter operators' safety records, policies, procedures and quality of service. Since almost all Part 135 operators are smaller than the typical airline, accommodating multiple safety audits poses real economic and time burdens. In some cases, popular operators have had to deal with eight to 10 audits a year.
Complicating this is the presence of multiple auditing standards among auditing companies and consultancies as well as the existence of the International Business Aviation Council's (IBAC) International Standard for Business Aircraft Operations, or IS-BAO, a safety- and quality-assurance standards set based on ISO (International Standards Organization) principles. (Until this year, the Flight Safety Foundation also maintained its own operational standards program for business aviation dubbed Q-Star; however, the initiative was shut down in response to the growing popularity of IS-BAO.)
Now, some controversy is resulting from the Air Charter Safety Foundation's (ACSF) introduction in April 2009 of a new performance and auditing benchmark oriented specifically toward charter operators with the rather prosaic title of Industry Audit Standard.
The controversy centers on the perceived need for yet another operational safety and auditing standard when one - IS-BAO - already exists for Part 91, 91K (fractional ownership) and 135 operators. On top of the avalanche of third-party audits, many operators are questioning why yet another standard to measure themselves against is necessary. In response, ACSF's safety management director, Russ Lawton, cited an unnamed Part 135 operator that was undergoing eight audits a year - “almost one a month” - and claimed the charter industry “was asking for something like what the airlines are doing through IOSA only for the [Part] 135 world.
To support the current level of multiple annual audits, Lawton, who also holds the safety director post at the National Air Transportation Association (NATA), the organization that spawned the ACSF, pointed out “there has to be an allocation of company resources to respond to the audit, [and] you have to dedicate staff time to the audit preparation and follow-up.
“And let's face it,” he continued, “there are varying qualities of audits and auditors - some will visit for an afternoon, others for two weeks. So from the operator point of view, there was a need for one type of audit. You do it every two years, and it goes into a registry.”
Countering any suggestion that NATA wanted the ACSF to somehow dominate the standards and auditing business, Lawton noted that the latter is an independent, charitable foundation (for which 501C3 status as a nonprofit entity has been filed with the IRS) whose purpose “is to promote industry best practices, gain acceptance of SMSes throughout the commercial world, gather accurate industry data and provide operators with tools to enhance their safety practices” and that the audit standard “is a tool for accomplishing that.” It also distributes free Aviation Safety Information System (AvSIS) software, purchased in 2008 from Reed Business Information in the U.K.
Dennis Keith, president and CEO of Dallas-based charter/management company Jet Solutions and an NATA board member, added that, “You have to remember that there were some really bad Part 135 accidents earlier in the decade, and we saw the need for some proactive measures to get this under control.”
The Big Fix
The airlines “fixed this problem [of continuous multiple audits] in 2000 with IOSA,” Keith continued. He maintains that the “beauty” of the ACSF common standard audit, as opposed to the programs of independent auditors, is that “when you're dealing with independent auditors, you're getting independent opinions. Going with an industry audit standard eliminates this. From the operator's perspective, if I [as a charter operator] need supplemental lift, then I can go to the Industry Audit Standard registry to find other operators who meet the same standard I do, so I have a lot of confidence in using those operators. From the consumer side, what will eventually happen is that the Safety Foundation standard will become recognized, allowing the consumer to select between operators not from what they perceive their safety level to be but from an industry-recognized safety standard.”
The ACSF is claimed to be a product of considerable input from the charter community. When the program was being formulated in 2007 and 2008, two working groups were assembled, one devoted to standards and the other to auditors, the latter of which developed materials and auditing guidelines. According to Keith,representatives were “included in the loop,” too. A particular interest of the Feds was “to see that the training and standard were sufficient to meet the FAA's requirement level for a safety management system. At some point, safety management systems will probably become requirements of the 135 industry.” In some parts of the world, they already are, since as of January 2009, ICAO has mandated, through Annex 6, Part 2 of its regulations, that its signatory states require SMS for all commercial operators. (The United States, through the FAA, however, has yet to implement the requirement.)
Lawton emphasized that the Part 135 Industry Audit Standard was patterned on the airlines' IOSA “because the major areas are all the ones that a certificate holder would have to perform: management organization, flight ops, scheduling and dispatch, maintenance, cabin operations, ground handling and servicing, cargo operations, operational security, passenger handling and safety, and HAZMAT - the 10 major areas the ACSF audit looks at. This is compatible with IOSA, although ours is 10 [major areas of focus] and theirs is eight, as we felt special emphasis was needed in some areas. That is the structure of the audit.”
The ACSF is “auditing for regulatory compliance and best practices,” Lawton said, “auditing to our standard, which goes beyond regulatory compliance. There shouldn't be any surprises when the auditors show up, which is why we provide the operators with a checklist. This is not a check-the-box audit, it is a process audit. ‘Do you have a process for this? If so, is it documented? And if documented, is it implemented?’ The basic premise of any audit is that I come in and review what you say you do and then verify that you're doing it.”
Referring to “shelfware,” or manuals kept on prominent display solely for the benefit of the safety auditors that list procedures the operation actually isn't using, Lawton stressed the importance of following through and then documenting the actions. “‘Walk me through how you put together an international trip,’ is an example [of how an ACSF auditor would approach an inspection],” Lawton said. “You may be able to tell me, but if it's not documented, it's worth nothing. If the key person who knows the process disappears tomorrow, you are the source of ‘tribal knowledge’ in the company for this process. It all goes to accountability - if we don't agree on a procedure, there is no standard.”
The ACSF began conducting audits in June 2009. Keith's Jet Solutions was the first Part 135 operator to complete the audit and achieve registration; second was's Flexjet fractional operation (for which Jet Solutions provides the majority of charter backup.)
Another early adopter is Executive Fliteways, a charter operator based in Ronkonkoma, N.Y. Noting that his company was one of the first to undergo an ACSF audit, Ken Gray, the director of operations, said, “The ACSF standards are more comprehensive and thorough than those of the major auditing companies.” When Jet Solutions underwent its audit, Keith reported, the FAA sent a team from the Washington headquarters to observe the process and, in turn, audit the ACSF standard and the auditors performing the inspection.
As of mid-November, 27 charter operators had gone through the process, with only two posted in the registry at that time, as the bulk of the audits were still in review and some operators were correcting shortcomings revealed by the inspections.
“After the audit is completed and reviewed, any findings not conforming to the standard are presented to the operator, whose personnel must then develop a corrective action plan as to how they intend to meet the standard in order to resolve the finding,” Lawton explained. “Then the next step in the process is to implement the corrective action plan and document it.”
If revisions are necessary for the operations manual, the ACSF requires proof that the revision has been accepted by the FAA, since a commercial operator's manual is an approved document. Other findings might apply to revising training, SOPs, etc. “It is an accepted conclusion that there are three basic fixes in this business,” Lawton said: “technology, training and regulations.”
Operators can be audited by request of outside entities, such as potential customers desiring to ensure particular charter providers meet their preferred safety level, or can request the audits themselves either as an internal checkup or simply to get themselves into the ACSF registry. Before an auditor is retained (which is the responsibility of the operator), the ACSF provides the operator with a pre-audit checklist to aid preparation for the on-site inspection. “The whole idea to avoid having someone going through the process who really isn't prepared to do it,” Lawton said. “Once it's established they're in good shape for the audit, then they [the operator] can approach one of the accredited auditors and set up the appointment schedule.” A completed audit is good for two years.
The ACSF accredits existing third-party audit companies authorized to conduct the audits, eight having been approved thus far. “The auditors are trained individually and must be affiliated with the auditing companies,” Lawton said. “The ACSF does the training, ensuring consistency and quality and that everyone is on the same page.”
Once an audit is arranged, the operator pays the ACSF for the audit fees, and the Foundation reimburses the audit company when the audit is completed. “We use a sliding pricing scale based on the number of aircraft in the operator's fleet,” Lawton said. “The basic audit is three days and two auditors for one to 15 aircraft, priced at $13,650.” For a fleet between 16 and 30 aircraft, four days is required, and the fee is set at $17,280. “When it goes beyond four days,” Lawton said, “we base it on a per-day fee.”
(A price schedule can be viewed on the ACSF Web site at www.acsf.aero. For information on the audit standard, add “/audit.” The operator standards manual, guidance material and a regulatory reference index can be downloaded without charge.)
Lawton acknowledged, “Some operators want to be audited by ARGUS, Wyvern, and do IS-BAO as well because they want to put those stamps of approval on their ads,” a pursuit he described as “a marketing tool. If you can demonstrate you are operating to a higher standard it is a win-win for the industry.”
Despite its self-described practical and noble purpose, the ACSF audit has created heartburn among some members of the auditing community for obvious reasons. After all, if the new standard succeeds at reducing the number of audits a commercial operator must undergo, there will be considerably less business for the auditing industry.
Moreover, some auditors maintain the new audit is simply redundant. “We took a careful look at the ACSF standard and its auditing process and determined that the industry did not need it with IS-BAO having been out there since 2002,” ARGUS President and CEO Joe Moeggenberg said from his office in Cincinnati. “The standard already existed for the charter industry, and that was IS-BAO. It works extremely well with good audit standards, and it's an international program. If you're an international operator, you only need IS-BAO to comply with the ICAO requirement [for SMS, mentioned earlier]. If the operator does not operate internationally, then perhaps it should take a look at the ACSF standard, as it's good for domestic operations.”
ARGUS is a “huge” supporter of IS-BAO, Moeggenberg said, “because it is an international standard. As of last January , if you are flying outside the United States - even to Canada - ICAO [Annex 6, Part 2] will require that you be able to prove you have an SMS in place, and the best way to comply with that is to be registered with IS-BAO. The member organizations of IBAC include every business aviation organization out there. So ICAO isn't going to approve another SMS program for business aviation without IBAC being involved.”
Before the current financial crisis took hold, Moeggenberg said, fractional ownership providers were the largest purchasers of charter, but now charter brokers and business flight departments are the biggest charter users. “Many of the major corporate flight departments are already on the IS-BAO registry or in the process of registration,” he said, and “We see a growing trend among corporations that clearly want to charter from operators that have demonstrated compliance with the same standard.”
It should be pointed out that ARGUS formerly held a contract with NetJets to audit the latter's backup charter providers, but NetJets has moved its charter vetting to the ACSF. Moeggenberg said his company, which is a registered IS-BAO auditor and one of eight companies worldwide qualified by IATA to conduct IOSA airline audits, has decided not to participate in the ACSF program.
IS-BAO: a ‘Scaled’ Program . . .
Likewise noting that many business aviation users seeking charter today are IS-BAO-registered flight departments, Katherine Perfetti, IBAC's standards manager, said that as a result the Council is seeing an increase of charter operators undergoing the IS-BAO process.
In conceiving the ISO-based standards program, she said IBAC purposely did not mirror the airlines' IOSA scheme as did the ACSF “because we wanted to build a standard that fit a wide variety of operators and missions, one that was scalable, from single-pilot operators to large operators flying international missions. We also wanted a program that will build a safety culture within the operation, wrapped around an SMS, the key to the program. The audit piece is really secondary, but the real heart of the program is the implementation of the SMS, which links to the other performance standards in the program.”
Perfetti said she doesn't believe that the ACSF understands IS-BAO or what performance-based rules are. “Theirs is a very prescriptive standard,” she said. “Performance-based rules require an understanding of the regulations and the aircraft under which you operate. It's not a one-size-fits-all mentality - that's the scalability I mentioned earlier. In the IS-BAO standard, you have to have a system to identify the rules and things that apply to your operation, whether you're a [Part] 91 or 91K operation or where you're operating.
It also covers every aspect of the operation, from the cleaning crews to how an aircraft is operated, Perfetti noted.
Then there's the issue of ICAO's requirement for commercial operators in its signatory states to have safety management systems.
“Annex 6, Part 2 allows the governments of signatory states to use an industry code of practice as a means of compliance, that is, IS-BAO,” Perfetti said.
And in Europe,has stated it will accept a recognized industry code of practice as a means of compliance with the SMS requirement. Providing the stamp of approval to IS-BAO as an industry code of practice is CEN, the Comité Européen de Normalization, or European Committee for Standardization, the official standards-setting entity for the European Union which granted recognition to the program last August 2009. According to IBAC, the CEN endorsement will facilitate acceptance of IS-BAO in the upcoming EASA implementation rules.
“This was a multi-year process for us to achieve that - and no other standard has so far,” Perfetti observed. “The Euro recognition of IS-BAO is one of the reasons why many operators are pursuing registration in the program. We are continuing to work with governments around the world to educate them about the IS-BAO program, including the FAA, which so far has not endorsed any standard other than saying that they acknowledge that IS-BAO meets the ICAO Annex 6, Part 2 requirement.” (Perfetti is a former high-ranking FAA official.)
. . . and a Means of Compliance
Quick to avoid getting into a conflict with the ACSF, Perfetti nevertheless pointed out that IBAC “isn't trying to sell [commercial operators] anything, but IS-BAO is a means of compliance [with the ICAO SMS requirement] for operators. Thus, it is a benefit for them to comply and also carries a safety benefit. Compliance is a driver right now for many operators to meet the ICAO requirement, but there are still very many benefits to be derived from IS-BAO registration.”
She added, “We've had requests from operators to consolidate the various standards, and we would be interested in working toward that goal.”
Currently, about 200 operators of all stripes are fully registered in the IS-BAO program. Probably about 20 of them are commercial operators. Hundreds more have purchased the materials and are engaged in preparation. About 900 manuals are in distribution with operators, institutions and auditors. “It will grow on the commercial side because of the SMS requirement and especially due to the CEN recognition,” Perfetti said. “Operators also see an advantage from the marketing side. We are the ‘gold standard.’
“The third-party auditing standards [i.e., companies like Wyvern/CharterX and ARGUS] have been around for awhile, but we are working from the inside out - this is an industry standard developed by the industry. It was beta-tested for two years and introduced in 2002. It has been improved every year, and every year we send out a free update to every manual holder. We are a non-profit organization, and the whole purpose of the program is to raise the safety bar. We do charge for the manual, $950 for a member of an IBAC organization and $1,400 for a nonmember; however, those costs go directly to fund the program. The operator negotiates directly with the auditor for the audit. We have a little over a hundred auditors on our rolls, a large number because we need to provide worldwide coverage.” It should be noted that many auditors approved for the ACSF program are likewise endorsed by IS-BAO to conduct audits for that program.
In delineating IS-BAO's attributes, Doug Carr, NBAA vice president, safety and security, noted, it “is updated annually by a panel of safety experts, and those results are released to all IS-BAO participants. The program is scalable, from single aircraft operators to major flight departments. Third, your regulatory basis is not exclusionary: IS-BAO is designed to work within your regulatory framework, whether it's Part 91/91K, Part 135 or even Part 121. And finally, this has more international recognition than any other program I'm aware of: ICAO, CEN, U.K. Overseas Territories. So if you're looking for a program that has worldwide recognition, only IS-BAO offers you that.”
While ARGUS has decided not to participate in the ACSF auditing program, Wyvern (now owned by the CharterX online charter operator database) has been on board since the ACSF opened its doors. “We are one of the founding members of the ACSF board and have been there since day one,” said Jim Betlyon, CharterX president. “And we do support a common audit standard. As long as it covers the kind of things our clientele feel are important, then we would support the adoption of a common audit like the ACSF. And it does fulfill that purpose.”
It will be a few years before people accept and understand the scope of the ACSF audit, Betlyon predicted. “NetJets/EJM was one of the first to support it. We've done about half of the ACSF audits so far in our capacity as an ACSF-approved auditing firm. NetJets recognizes the audit as a snapshot, but it is ongoing monitoring that ensures safe operations, and we do that through our database under contract to them.” Betlyon noted that the ACSF audit is very demanding, but maintains that once operators understand the process and its depth, they will accept it. “There is a lot of preparation required for it,” he said. “The smaller operators will probably not have an SMS in place or to the degree the ACSF requires.”
Despite the presence of audited industry codes of practice like IS-BAO and the ACSF, independent third-party auditors like Wyvern and ARGUS (plus many more) continue to maintain their own auditing and operator rating programs, offering Part 91/91K and 135 operators and charter customers lots of choice in terms of safety assurance programs and approvals, such as ARGUS's CHEQ system (for Charter Evaluation and Qualification) with its hierarchy of Silver, Gold, Gold Plus and Platinum ratings. “The ARGUS audit is just one part of our operator rating,” Moeggenberg pointed out. “We are accepting anyone who's been through a stage one IS-BAO audit [the interim audit in the program] for an ARGUS Gold Plus rating.”
Speaking for his program, CharterX/Wyvern's Betlyon said, “A Wyvern recommendation means you've been assessed according to our system. It means that an operator not only has passed the on-site audit but continues to operate at the Wyvern level - for example, they do simulator training twice a year, have logged 75 hours in the last 90 days and 300 hours in the past year, and so forth. We assure currency. The guy who just came out of sim training and is an active pilot is a safer pilot. Because our Fortune 500 customers require a Wyvern audit, we will continue to audit 135 operators to the Wyvern standard. Once the ACSF does a better education of the consumer, I can see the ACSF audit increasingly accepted. We also continue to do IS-BAO and best-practices audits of Part 91 operators.”
Bill Voss, president of the Flight Safety Foundation, observed that “Charter operators do need an accepted audit standard with at least a national registry so they can reduce the number of audits they have to go through.” He said “duplicative audits that are sometimes superficial” had prompted the airlines to create IOSA and that “the real key is the registry and acceptance.”
Neither has yet achieved universality within the charter community, but there has been progress nonetheless. As NATA/ACFS's Lawton noted, “All the auditing that has been done to date has benefited the industry, and we have improved as a result. Just the idea that [the various programs] are auditing to a standard and that someone is coming in from the outside and verifying that an operator is meeting a standard and best practices is beneficial to the industry and the end user. I think that all these programs have advanced that notion.”