OREANDA-NEWS. November 15, 2007. there was held a regular session of the OJSC “Aeroflot” Board of Directors.

There was discussed the issue “On cooperation progress of OJSC “Aeroflot” with CJSC “Civil Aircraft of Sukhoi” (CJSC “SAS”).

December 2005 OJSC “Aeroflot” and CJSC “Civil Aircraft of Sukhoi” signed the contract on delivery of 30 regional class aircraft SSJ-100.

May 2007 there was made the agreement between OJSC “Aeroflot” and CJSC “Civil Aircraft of Sukhoi”, which determined that the airline should purchase 15 aircraft units more, with an option for 5 regional class airplanes (SSJ-100).

OJSC “Aeroflot” and CJSC “Civil Aircraft of Sukhoi” cooperate in 7 joint working groups. Their aim is to promote manufacturing and to arrange exploitation of SSJ-100 aircraft in compliance with OJSC “Aeroflot” regulations, as the first customer of airplanes of the type in accordance with terms, stipulated by contractual documents. More than 40 working group instruction were taken into consideration during aircraft design and manufacture phases.

There was discussed the issue on risk management and aviation risk hedging in the Company.

In insurance coverage the airline proceeds from the following basics:
sufficient insurance coverage of OJSC “Aeroflot” property interests;
high quality insurance coverage provided.

Lately within four years there have been regularly reduced insurance costs at a high quality insurance coverage of all insurance program components.

In 2004 OJSC “Aeroflot” spent 25,1 mln. US dollars for all-type insurance, but at the end of 2007 they will not exceed 18,1 mln. US dollars. At that passenger turnover, comparing 2004 to 2007 is planned top increase from 6 863 100 to 8 345 500.

The airline insurance system includes the following options:
aircraft insurance;
voluntary health insurance;
vehicle insurance (hull insurance, accident, CMI);
compulsory individual passenger accident insurance;
cockpit personnel accident and professional dishabituation insurance;
property insurance;
property liability insurance on hazardous activities and hazardous facilities exploitation.

A high quality, security and flight safety promote regular insurance rate reduction in reinsurance markets.

OJSC “Aeroflot” administration has assigned the task to elaborate a complex risk management system and fix it in special regulatory documents.

When implemented a complex, functional risk management system will help to increase force-majeure management quality, reduce airline losses, establish a warning risk management system, secure a further favourable environment for OJSC “Aeroflot” in the insurance market, by partners, clients and corporate staff.

In compliance with ICAO and IATA requirements, OJSC “Aeroflot” is implementing a flight safety management system, representing a complex of activities, procedures, basics and programs, which are employed to define, estimate and determined flight safety risks.

That is why there was adopted the flight safety risk management platform.

OJSC “Aeroflot” implements a complex passenger insurance system in accordance with those of leading world airlines.

OJSC “Aeroflot” Board of Directors members pointed out that the airline has been steady to maintain a proper insurance coverage quality, accompanied by a regular airline handling cost reduction.

OJSC “Aeroflot” Board of Directors has discussed airline social programs. They are based on an airline social strategy, which fixes that OJSC “Aeroflot” should actively participate as to solve current national problems of social and economic development; it is based on an effective Collective contract, which determined a wide range of social benefits and protection for employees, including health promotion and recreation programs for the staff, non-state pension coverage, compulsory medical insurance for employees, their families and retired airline personnel.

OJSC “Aeroflot” corporate social programs:
medical insurance program for employees, their families and retired personnel;
non-state pension coverage;
housing for employees;
corporate airline tickets;
service vehicles and parking areas, preschools;
catering;
recreative sports, corporate events, arrangements for veterans.

More than 14 000 airline employees, 3 512 pensioners and 8 916 family members enjoy medical services.

Annually more than 500 members of cockpit staff stand for rehabilitation treatment, arranged by OJSC “Aeroflot” Medical Centre.

Annually more than 500 members of cockpit staff stand for rehabilitation treatment, arranged by Airspace Medical Centre.

For 9 months of 2007 medical airline costs amounted to:
receipt benefits for employees, their family members and pensioners – 7,5 mln. RUR;
treatment in Medical centre and other medical establishments – about 50 mln RUR;
the airline has spent about 70 thousand RUR.

Sanatorium-resort treatment for staff and their family members is finance by compulsory medical insurance funds.

There have been implemented programs on industrial injuries and occupational diseases prevention.

There has been arranged sanatorium and recreational treatment for children of the staff majority.

The airline covers personnel costs (100% of parent allowances) for children education in municipal preschools. In 2007 8,6 mln RUR will cover the costs.

A non-state pension coverage system (NPCS), implemented by OJSC “Aeroflot” is based upon cooperation of employees and employers in pension foundation.

6 612 airline personnel members participate in the NPCS.

Basically the airline resolves housing problems by providing beneficial bank credits under OJSC “Aeroflot” guarantee using a simplified procedure for execution and coverage.

OJSC “Aeroflot” is a direct participant in national scale social and charity programs realization.
On an annual basis “Aeroflot” arranges “Fellow soldiers meeting”, which unites thousands of Great Patriotic War veterans, fascist camp prisoners, blocking operation participants from many Russian cities, CIS and Baltic countries; here they can meet their fellow soldiers and visit battle fields.
“Aeroflot” cooperated with the Research Centre of cardiovascular surgery of A.N.Bakulev and Public charity fund “Children’s hearts” to elaborate the program “Wings of Hope” to held children from Russian regions, suffering from cardiovascular diseases.
Since 2003 “Aeroflot” has been providing a regular assistance to children with critical illnesses – treated at the Federal children hematology, oncology and immunology centre and Russian clinical hospital for children.
The company provides free tickets for bone marrow donor sells transportation and foreign treatment for children, who can not be cured by Russian doctors.
“Aeroflot” has set out to cover costs for gold medalists from the Kamchatka region, the Khabarovski and Primorsky Territories, Siberia and Zauralye traveling to Moscow to enter its high educational establishments. Since this platform has been implemented 248 pupils have become students of Moscow universities.
In 2007 the airline provided support for a Russian team during research project competition among senior pupils, arranged by Intel corporation in Albuquerque (USA). Five projects of Russian students were among medal winners and they received an honorary reward.
Till the end of 2007 “Aeroflot” will provide teachers form all Russian regions with a chance to participate in the second session of National pedagogical meeting, being an official event carrier.
“Aeroflot” is implementing a “Cultural Support” program.
With “Aeroflot” support graduates and students of Moscow State Conservatory (MSC) can take part in prestigious international competitions. 150 prizes won and winner rewards serve the best praise for the airline.
“Aeroflot” has been an active sponsor of International theatre Chekhov’s festival in Moscow, Russian theatre festival “Golden Mask”. Last year “Aeroflot” was awarded with a “Golden Mask” for “Russian theatrical art support”.
“Aeroflot” is an official carrier of national TV “TEFI” award, established by Russian Television Academy for outstanding achievements in TV art.
Within the framework of “Sports support” program the airline is a usual partner of Russian Olympic Committee. In 2006 our aircraft transported Russian Olympic team in Turin.
“Aeroflot” has arranged the largest open chess tournament - Aeroflot Open. In 2004 it was registered among Guinness World Records as the world’s most participated competition. In 2006 the number of countries-competitors exceeded 60.

The airline is paying a great heed to children and young sport support and disabled sportsmen assistance. The OJSC “Aeroflot” history records hockey championships of International Academy of Sports of Vladislav Tretyak, participation in the international junior tennis competition “Kremlin Cup Junio”, support for Paralympics, Moscow football club “Spartak” and “Vozrozhdenie” for the disabled, Russian Federation of disabled ski mountaineering and many other events.

On the whole, OJSC “Aeroflot” Board of Directors appreciated airline social programs and their development.

OJSC “Aeroflot” Board of Directors has adopted typical report system for enterprises, established by OJSC “Aeroflot”.

A fixed report system will provide objective data on activities of enterprises and elaborate measures as to increase their performance to the benefit of affiliates, subsidiaries and OJSC “Aeroflot”. OJSC “Aeroflot” representatives in such enterprises will be able to influence management more substantially and directly and secure a wider implementation of steady OJSC “Aeroflot” development.