Cathay Pacific 2006 Annual Report Download - page 37

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Cathay Pacific 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 all the
code provisions set out in the Code on Corporate
Governance Practices (the “CG Code”) contained in
Appendix 14 of the Listing Rules. The Company has
also put in place corporate governance practices to
meet most of the recommended best practices in the
CG Code.
The Board of Directors
The Board is chaired by Christopher Pratt (the
“Chairman”). There are five executive Directors
and twelve non-executive Directors, four of whom
are independent. Names and other details of the
Directors are given on pages 26 and 27 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. 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 has established the following
committees: the Board Safety Review Committee, the
Executive Committee, the Finance Committee, the
Remuneration Committee and the Audit Committee,
the latter two with the participation of independent
non-executive Directors.
35
Cathay Pacific Airways Limited Annual Report 2006
Corporate Governance