Cathay Pacific 2004 Annual Report Download - page 31

Corporate Governance
Cathay Pacific Airways is committed to maintaining
a high standard of corporate governance and
devotes considerable effort to identifying and
formalising best practices of corporate governance.
The Company has complied throughout the year
with the Code of Best Practice as set out in the
Listing Rules.
The Stock Exchange has promulgated a new Code
on Corporate Governance Practices (“Code”) which
came into effect in January 2005. The Company has
put in place corporate governance practices to meet
all the provisions and most of the recommended
best practices in the Code.
THE BOARD OF DIRECTORS
The Board is chaired by David Turnbull (“the
Chairman”), who took over this role from James
Hughes-Hallett on 1st January 2005. There are four
executive Directors and 13 non-executive Directors,
four of whom are independent. Names and other
details of the Directors are given on pages 20 and
21 of this report. All Directors are able to take
independent professional advice in furtherance
of their duties if necessary. The independent
non-executive Directors are high calibre executives
with diversified industry expertise and serve the
important function of providing adequate checks
and balances for safeguarding the interests of
shareholders and the Company as a whole.
To ensure a balance of power and authority, the
role of the Chairman is separate from that of the
Chief Executive (“CE”). The current CE is Philip
Chen who took over from David Turnbull in January
2005. The Board regularly reviews its structure,
size and composition to ensure its expertise and
independence are maintained. It also identifies and
nominates qualified individuals, who are expected
to have such expertise to make a positive contribution
to the performance of the Board, to be additional
Directors or fill Board vacancies as and when they
arise. A Director appointed by the Board to fill a
casual vacancy is subject to election of shareholders
at the first general meeting after his appointment
and all Directors have to retire at the third annual
general meeting following their election by ordinary
resolution, but are eligible for re-election.
All Directors disclose to the Board on their first
appointment their interests as director or otherwise
in other companies or organisations and such
declarations of interests are updated annually.
When the Board considers any proposal or
transaction in which a Director has a conflict of
interest, he declares his interest and is required
to abstain from voting.
The Board is accountable to the shareholders for
leading the Company in a responsible and effective
manner. It determines the overall strategies,
monitors and controls operating and financial
performance and sets appropriate policies to
manage risks in pursuit of the Company’s strategic
objectives. It is also responsible for presenting a
balanced, clear and understandable assessment of
the financial and other information contained in the
Company’s accounts, announcements and other
disclosures required under the Listing Rules or other
statutory requirements. Day to day management of
the Company’s business is delegated to the CE.
Matters reserved for the Board are those affecting
the Company’s overall strategic policies, finances
and shareholders. These include: financial
statements, dividend policy, significant changes in
accounting policy, the annual operating budgets,
material contracts, major financing arrangements,
major investments, risk management strategy
and treasury policies. The functions of the Board
and the powers delegated to the CE are reviewed
periodically to ensure that they remain appropriate.
The Board meets six times a year. The average
attendance rate of the Directors for the year was
86%. The Board has established the following
Cathay Pacific Airways Limited 2004 Annual Report 27