Jeff Novota
SOUTHWEST AIRLINESAbout Jeff Novota
Jeff Novota is Senior Vice President, Chief Legal Officer & Corporate Secretary of Southwest Airlines Co., having been promoted from Vice President General Counsel & Corporate Secretary (effective June 1, 2024) and later signing numerous SEC filings in 2025 in his CLO capacity . He joined Southwest in 2011 after practicing law at a Chicago firm focused on transportation finance and regulatory matters; he holds a J.D. from Indiana University, a B.S. from Purdue University, and an FAA commercial multi‑engine pilot certificate . Company performance under Southwest’s ongoing transformation includes record Q3 2025 operating revenues of $6.9B and reaffirmed FY 2025 EBIT guidance of $600–$800M, aligning executive incentive designs with EBITDA and operational metrics . Governance frameworks relevant to his role include enhanced clawback policies, stricter share ownership guidelines (CEO 6x salary; other execs 3x; Board 5x retainer), and prohibitions on hedging/pledging of company stock .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Southwest Airlines Co. | Vice President Legal—Corporate & Transactions | Pre‑2024–2024 | Led corporate and transactions legal work prior to promotion . |
| Southwest Airlines Co. | Vice President General Counsel & Corporate Secretary | Effective Jun 1, 2024 | Assumed leadership of Legal Dept., overseeing governance, securities, compliance, transactions, labor/employment, and litigation; advisor to Senior Management Committee and Board . |
| Southwest Airlines Co. | General Counsel & Corporate Secretary | 2024–Early 2025 | Signed multiple SEC filings in role; operationalized Cooperation Agreement with Elliott . |
| Southwest Airlines Co. | Senior Vice President Chief Legal Officer & Corporate Secretary | Mar–Nov 2025 | Elevated to CLO; signed 8‑Ks and corporate bylaws/amendments, underwriting agreements . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Chicago law firm (name not disclosed) | Attorney (transportation finance & regulatory) | Pre‑2011 | Brought transportation finance/regulatory expertise to Southwest . |
Fixed Compensation
- Not disclosed for Novota in public filings; he was not a named executive officer in the 2024/2025 proxy. Company-wide base salary and STI targets are disclosed for NEOs but not individually for Novota; therefore specific base salary, target bonus, and actual bonus are unavailable .
Performance Compensation
- Southwest’s executive incentive architecture emphasizes pay-for-performance, with 2024 STI fully based on a Management Incentive Scorecard, and LTI split 50/50 between time‑vesting RSUs (vesting 1/3 per year over 3 years) and performance‑based RSUs (3‑year performance period) .
2024 Management Short‑Term Incentive Scorecard (Company level used for executive payouts)
| Metric | Weight | 0% Threshold | 50% Award | 100% Target | 150% Award | 200% Max | 2024 Result | Payout vs Target |
|---|---|---|---|---|---|---|---|---|
| EBITDA (ex‑specials) | 50.0% | $2.46B | $3.08B | $3.71B | $4.17B | $4.63B | $2.14B | 50.0% (floor applied) . |
| Customer/Operational composite (WSJ rankings: on‑time, completion, delays, mishandled bags, bumping, complaints) | 25.0% | 7th | 5th | 3rd | 2nd | 1st | 2nd | 191.7% . |
| Major initiatives – Efficiency/Productivity | 10.0% | Subjective | Subjective | Subjective | Subjective | Subjective | 75% | 75% . |
| Major initiatives – Network resiliency/optimization | 10.0% | Subjective | Subjective | Subjective | Subjective | Subjective | 100% | 100% . |
| ESG/Belonging – Director+ training completion | 2.5% | <90% | 94% | 97% | 99% | 100% | 100% | 200% . |
| ESG/Sustainability – fuel efficiency vs 2023 | 1.5% | 0.0% | 1.0% | 1.7% | 2.0% | 2.3% | 1.7% | 100% . |
| ESG/Sustainability – reduce single‑use plastics | 1.0% | Subjective | Subjective | Subjective | Subjective | Subjective | 100% | 100% . |
| Total Company Short‑Term Enterprise Performance | — | — | — | — | — | — | — | 97.9% of target . |
LTI Design – Vesting and Performance
- RSUs: Time‑based vesting 1/3 per year over 3 years .
- Performance RSUs: 3‑year performance period; payout tied to ROIC (after‑tax) less “Excess Cash” construct; performance‑based portion = 50% of total LTI value for execs in 2024 .
Equity Ownership & Alignment
| Policy/Item | Detail |
|---|---|
| Share ownership guidelines (updated Mar 14, 2025) | CEO: ≥6x base salary; Other executive officers: ≥3x base salary; Board: ≥5x annual cash retainer. Defined ownership includes common shares (incl. Retirement Savings Plan) and unvested RSUs; execs expected to comply within 5 years; Board within 5 years, with existing members until Mar 14, 2030. Company states all executive officers and Board members meet guidelines . |
| Hedging/Pledging | Insider Trading Policy prohibits hedging/derivatives, margin accounts, and pledging of Southwest securities by officers/directors; applies to designees and household members . |
| Options | Company does not grant stock options; no option grant timing practices in 2024 . |
| Beneficial ownership (individual) | Novota not listed in Security Ownership of Management table; individual share counts not disclosed . |
Employment Terms
| Term | Company Program/Policy | Key Economics/Structure |
|---|---|---|
| Severance limitation | Corporate Governance Guidelines cap severance agreements for Section 16 executive officers at ≤2.99× (base salary + target annual bonus), excluding specified items (accrued pay, earned bonus, consulting, death/disability, settlements); Board discretion on application . | |
| Change‑of‑control | Executive employment agreements utilize double‑trigger (requires a qualifying termination following change‑of‑control) . | |
| Clawback | Amended and restated clawback policy to recoup erroneously awarded incentive‑based compensation after a required restatement; applies to executive officers and incentive comp after Oct 2, 2023 . | |
| Insider trading controls | Blackout and pre‑clearance procedures; prohibitions on hedging/pledging; policy filed as exhibits to most recent 10‑K . |
Performance & Track Record
- Legal leadership: As Corporate Secretary/General Counsel/CLO, Novota signed numerous 8‑Ks (including bylaws amendment and underwriting agreement) and implemented the Elliott Cooperation Agreement amendment, indicating centrality in capital markets and governance actions .
- Company execution: Record Q3 2025 revenue ($6.9B), reaffirmed FY 2025 EBIT $600–$800M; transformational initiatives (bag fees, basic economy, assigned/premium seating, red‑eyes, distribution partnerships) underscore alignment of incentives to EBITDA and operational KPIs .
- Say‑on‑pay and governance: 2025 say‑on‑pay support: 401,418,268 for vs. 25,796,557 against; updated share ownership guidelines; Compensation Committee refreshed with independent consultant (Meridian) in 2025 .
Compensation Committee Analysis and Peer Benchmarking
- Independent consultants: Pay Governance LLC (2024); Meridian Compensation Partners, LLC engaged Jan 2025 .
- Benchmarking datasets: Willis Towers Watson 2023 General Industry database (33 comparable companies; 543 total sample) and airline peers (American, Delta, United, Alaska, JetBlue) to guide pay levels and structures .
Vesting Schedules and Insider Selling Pressure
- RSU/PSU vesting mechanics summarized above; individual Novota grant sizes and vest schedules not disclosed in proxy filings .
- Insider transactions: Form 4 data could not be retrieved via the insider-trades skill due to access error; recent filings show Novota as signatory officer on multiple 8‑Ks, but no transaction detail is available in documents queried .
Equity Ownership & Alignment (Compliance and Red Flags)
- Ownership guideline compliance: Company states all executive officers meet ownership guidelines; hedging/pledging prohibited—reduces misalignment risk .
- Pledging/Hedging: Explicit prohibition; no disclosed exceptions for officers .
- Options repricing: Company does not use options; no repricing risk in 2024 .
Board Governance (Context)
- Not a Director; serves as Corporate Secretary. Board refresh included nine new Directors in 2024, creation of Finance Committee, and appointment of an independent Chair; relevant to legal and governance oversight under Novota’s remit .
Employment & Contracts (Additional Notes)
- Start date at Southwest: 2011 (biographical disclosure) .
- Current role tenure: CLO & Corporate Secretary by March 31, 2025; continuing through at least November 3, 2025 based on filings .
- Non‑compete/non‑solicit/garden leave: Not disclosed in available filings.
Say‑On‑Pay & Shareholder Feedback
- 2025 Annual Meeting: Advisory vote on executive compensation—401,418,268 for; 25,796,557 against; 1,076,118 abstentions; robust support amid program refinements .
- 2025 Clawback proposal: Shareholder proposal to amend clawback policy—21,779,309 for; 404,403,087 against .
- Engagement: Company engaged with holders representing over 70% of shares in 2024; board refresh and governance enhancements followed .
Investment Implications
- Incentive alignment: With EBITDA and operational metrics at the core of STI and three‑year ROIC‑based PSUs, the legal executive team’s compensation framework emphasizes multi‑year value creation and operational reliability, reducing the risk of short‑term earnings management .
- Retention risk: Ownership guidelines (3x salary for execs), prohibition on hedging/pledging, and a severance cap at 2.99× constrain misalignment and “pay for failure,” but individualized retention incentives for Novota are undisclosed; monitor future proxies for role‑specific grants .
- Trading signals: Lack of disclosed Form 4 activity for Novota in documents queried and strict insider policies limit visibility into near‑term selling pressure; watch subsequent Form 4s and RSU vesting calendars once disclosed to assess potential sale windows .
- Governance execution: Legal stewardship of Elliott Cooperation Agreement amendments, bylaws updates, and capital markets documentation suggests strong governance continuity—supportive for execution of revenue/cost initiatives and capital allocation (repurchases) underway .