Opportunity to thrive and responsibility to sustain

Interview with Richard Moriarty, outgoing Chief Executive of the Civil Aviation Authority

Richard Moriarty has led the Civil Aviation Authority (CAA) through the toughest time the aviation industry has faced on a global scale. He talks openly about the challenges faced during the pandemic and the current recovery period for the industry and maintains a very measured view on the responsibility of the regulator and the aviation sector to create more sustainable and environmentally sound alternatives. This necessitates a great emphasis on innovation and investment, much of which grew positively at home and with international engagement during and post pandemic. Richard’s experiences have allowed and encouraged him to reflect on good leadership and why it has become more important than ever and particularly in regulation as consumers continue to face extremely challenging times. Richard will be leaving his position in April 2023.


 

You were appointed chief executive of the Civil Aviation Authority in 2018.  How has the consumer’s experience of the sector changed during that time?

The UK has one of the most vibrant and connected aviation economies in the world. It is the third largest behind the US and China. This choice, competitiveness and innovation has been a tremendous positive for the UK public to connect with people and places around the world – and for UK plc given aviation’s vital role in cargo and trade.

Set against these strong underlying market fundamentals, I should highlight two significant things that I’ve had to deal with in my time as CEO.

Firstly, we must recognise that COVID has had a profound impact on aviation and aerospace since the outbreak of the pandemic and the associated travel restrictions. The last couple of years have been very challenging for consumers and all those working in aviation with flight activity at times dropping to 10-20 per cent of pre-pandemic levels. That was quite an existential threat, however, I am really pleased to see how strongly aviation has recovered now that travel restrictions have been lifted. We are back to over 80-85 per cent of pre-pandemic levels of activity and expect to exceed pre-pandemic levels of activity in the next couple of years. It demonstrates that this industry is resilient and there is a lot of pent-up demand for people to travel and connect. The pandemic has been quite an experience for us all in aviation and under my Chief Executive at the CAA.

The second point is that since I became CEO, I’ve noticed that despite their strong demand for aviation services, the public has become increasingly aware of its environmental impacts and keen that the industry ensures it earns its place as a modern responsible corporate citizen especially in terms of carbon emissions. I am pleased that the industry is rising to this challenge, supported by the CAA and the Government through the Jet Zero challenge. There are some really exciting developments to help decarbonise aviation through sustainable aviation fuels, hydrogen technology and electric flight. I am keen that the UK is at the forefront of these developments as a leading aviation nation and as the industry regulator we play our facilitation role to ensure this is done safely. For example, the CAA helped to ensure that the world’s first commercial grade test flight of hydrogen fuel happened in the UK. I am really keen that we see more of that in the coming years in the UK – we have an important role to play.

 

“It starts with recognising in whose interest we ultimately serve – consumers and the public. Protecting the public is the core mission for any regulator.”

 

The pandemic and its aftermath have presented a unique set of challenges for the airline industry. Can you share some of the challenges, but also the opportunities and innovations which have arisen as a result?

Part of the challenge in the early days for all leaders was there was no playbook for a global pandemic and hence it was difficult for airlines and airports to plan ahead and set resourcing and investment levels when cash conservation was so important given their basic survival was threatened.

In the early stages there were problems with some airlines refunding consumers for cancelled bookings and we had to intervene to make sure the backlogs were reduced at sufficient pace. There were also operational challenges for airlines and airports from downscaling, and we worked very closely with them given our roles to ensure high levels of safety, security and cyber resilience. Equally we have seen challenges on the return to growth post pandemic given labour shortages and the impact this has had for some consumers earlier in the year in terms of disruption to their journeys or plans.

I’m always slightly reluctant to say there are upsides from a devastating global pandemic, but some opportunities have arisen. In recent months there has been a strong pent-up demand for travel and for people to reconnect with the world. It has also made consumers more conscious about the need to think about if their travel plans should be protected or flexible in the event of changes. Airlines and travel companies have shown a good level of innovation in their response to this desire for more flexibility. They have certainly worked out that offering people choice and offering people optionality is something that is popular and we expect to see more of that.

 

How did investment in aviation fare during the pandemic?

I have certainly noticed during the pandemic that while there was not a lot of investment going into commercial aviation as it faced a lot of existential threats, the amount of investment and focus going into new technology, particularly around decarbonising aviation actually increased. We had more people coming to us during the pandemic to launch new technologies including electric and hydrogen flight. Globally we had people relocating to the UK as they see it as a great place to launch and develop new technologies, as well as homegrown new industries taking advantage as well. We have a very proud aviation heritage in the UK and we are keen to preserve that. We have universities like Cranfield who have specific courses and research dedicated to aerospace and both the Government and CAA are keen to make the UK the best place in the world for such innovation.

 

“It must start with a recognition that one of the core responsibilities of any CEO, Board or Executive team is to be responsible for the health, vibrancy and diversity of the future talent pipeline for leadership positions.”

 

As we move into another period of challenge with the cost-of-living crisis how is the CAA looking to protect the rights of consumers at such a time?

Protecting consumers’ legal rights is an important role of the CAA. There are three areas where we pay particularly close attention, and we are often seen as the most proactive consumer-based regulator in Europe.

First, we ensure that airlines are complying with their obligations to refund and compensate consumers for delayed and cancelled flights. We have been very active on this throughout the pandemic and have held airlines to account. We have taken legal action against airlines where necessary to ensure compliance and have called on Government and Parliament to strengthen our powers; something that I’m pleased to say has been supported with a recent Government consultation on this matter.

Second, we pay special attention to how airports provide services for passengers with disabilities, both physical and non-physical. The UK has a proud record of accessible aviation travel. We are the only regulator in Europe to publish an annual assessment of airport’s performance – often called a league table – and from that we use reputational regulation to drive improvements across the system.

Third, we run the ATOL scheme for package holidays which gives you protection against your tour operator going bust. This has really demonstrated its value with collapses over recent years of both Monarch and Thomas Cook where the CAA undertook the largest peacetime repatriations in history to ensure consumers could finish their holidays and be flown home at no extra expense to them.

 

There has been an assertion from some travel operators that the regulator should be given more power over airlines. Can you share your view on this?

Quite simply we agree. Our formal legal powers over airlines for delayed and cancelled flights are very bureaucratic and slow. We have called on Government to modernise them to enable quicker more decisive action and bring the powers into line with those of other regulators. I’m pleased that the Transport Select Committee and the Government have recognised this and has supported us. The next stage is to develop the powers in detail through legislation.

 

How can good regulation empower and protect consumers at difficult times like this? How can a regulator engage with consumers?

It starts with recognising in whose interest we ultimately serve – consumers and the public. Protecting the public is the core mission for any regulator.

As a consumer-focused regulator of a dynamic and competitive industry we believe that best way to empower consumers is by focussing on giving them choice, access to good information, and making sure their rights are protected when things don’t go to plan. To do this we use full range of tools for example: informal influence, or soft power, with those we regulate to encourage them to do better and share best practice. The successful use of the sunflower lanyard for non-visible disabilities is one example of this; we set formal targets for Heathrow Airport in relation to security queue waiting times; and occasionally we have to take more formal legal action to enforce compliance.

We engage with consumers in a range of ways. We do so indirectly through an established Consumer Panel that advises us on policy development. We also engage directly through social media and other channels.

 

Other areas in which you have interest and experience face challenging times such as housing. Do you think this broader perspective has helped you in all of your roles?

Most definitely. Part of leadership must be to see and bring a broad range of perspectives to bear to solve knotty problems and create great opportunities. Experience across a number of industries or different contexts within an industry provide a greater range of data points and analogies to draw from. Albeit you need to be very careful not to fall into the trap of passporting a solution from somewhere without fully understanding the particular context. I am a big fan of my colleagues gaining experience elsewhere and bringing that experience back into the organisation.

Part of being a CEO is developing the next generation of leaders. How does the CAA, including in conjunction with other regulators, nurture that group to ensure that your successor, and theirs, can be drawn from a strong, diverse talent pool.

I think it must start with a recognition that one of the core responsibilities of any CEO, Board or Executive team is to be responsible for the health, vibrancy and diversity of the future talent pipeline for leadership positions. And that leadership is a skill and set of attributes and characteristics quite different to subject matter expertise. This is important to technical organisations like regulators who employ lots of experts.

There needs to be active and purposeful stress on succession planning, future skills planning, talent pathways, and diversity and inclusion. At the CAA we created something called the Skyline Board which is a shadow board of our younger talent to plug into a younger and more diverse demographic to feed into decision making at the highest level of the organisation. That has been a great success.

There are many informal networks which exist, but regulators should actively promote their people, particularly next generation leaders contributing, buddying and shadowing in different organisations as I think that would stand them in good stead and I would certainly welcome that at the CAA.

 


Richard Moriarty – Biography

Richard Moriarty joined the Civil Aviation Authority, the UK’s independent aviation and space regulator, responsible for the safety, security and consumer interests of those who fly, and those affected on the ground below, in January 2016 as Group Director of Consumers and Markets and Deputy Chief Executive, before taking over the role of Chief Executive in May 2018.
He is now due to leave his position in April 2023.

Prior to the CAA, Richard was the CEO of the Legal Services Board, which oversees the regulation of the legal profession in England and Wales. Richard has also held senior public and private sector roles in several regulated sectors including water, energy, aviation, postal communications, and social housing.

Richard was, until 2019, a non-executive Director of the Homes and Communities Agency Regulation Committee; a non-executive Board Member and Deputy Chair of the Social Housing Regulator between 2012-2019.

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