Cathay Pacific 2014 Annual Report Download - page 47

ANNUAL REPORT 2014
45Corporate Governance Report
Executive Directors and Executive Officers, as disclosed in
note 27 to the financial statements, was comparable with
that paid to equivalent executives in peer group companies.
No Director takes part in any discussion about his or her
own remuneration.
The following fee levels have been approved by the Board:
2014
HK$
2015
HK$
Director’s Fee 575,000 575,000
Fee for Audit
Committee Chairman 260,000 260,000
Fee for Audit
Committee Member 180,000 180,000
Fee for Remuneration
Committee Chairman 80,000 80,000
Fee for Remuneration
Committee Member 58,000 58,000
Accountability and Audit
Financial Reporting
The Board acknowledges its responsibility for:
• the proper stewardship of the Company’s affairs, to
ensure the integrity of financial information
• preparing annual and interim financial statements and
other related information that give a true and fair view of
the Group’s affairs and of its results and cash flows for
the relevant periods, in accordance with Hong Kong
Financial Reporting Standards and the Hong Kong
Companies Ordinance
• selecting appropriate accounting policies and ensuring
that these are consistently applied
• making judgements and estimates that are prudent and
reasonable; and
• ensuring that the application of the going concern
assumption is appropriate.
Internal Controls
The Board acknowledges its responsibility to establish,
maintain and review the effectiveness of the Group’s system
of internal controls with a view to ensuring that shareholders’
investments and the Company’s assets are safeguarded.
This responsibility is primarily fulfilled on its behalf by the
Audit Committee as discussed on pages 46 and 47.
The foundation of a strong system of internal control is
dependent on the ethics and culture of the organisation,
the quality and competence of its personnel, the
direction provided by the Board, and the effectiveness
of management.
Since profits are, in part, the reward for successful risk
taking in business, the purpose of internal controls is to help
manage and control, rather than eliminate risk.
Consequently internal controls can only provide
reasonable, and not absolute, assurance against
misstatement or loss.
The key components of the Group’s control structure are
as follows:
Culture: The Board believes that good governance reflects
the culture of an organisation. This is more significant than
any written procedures.
The Company aims at all times to act ethically and with
integrity, and to instil this behaviour in all its employees by
example from the Board down. The Company has a Code of
Conduct, which is posted on its internal intranet site.
The Company is committed to developing and maintaining
high professional and ethical standards. These are reflected
in the rigorous selection process and career development
plans for all employees. The organisation prides itself on
being a long-term employer which instils in individuals, as
they progress through the Group, a thorough understanding
of the Company’s ways of thinking and acting.
Channels of communication are clearly established,
allowing employees a means of communicating their views
upwards with a willingness on the part of more senior
personnel to listen. Employees are aware that, whenever the
unexpected occurs, attention should be given not only to
the event itself, but also to determining the cause.
Through the Company’s Code of Conduct, employees are
encouraged (and instructed as to how) to report control
deficiencies or suspicions of impropriety to those who are
in a position to take necessary action.
Risk assessment: The Board of Directors and the
management each have a responsibility to identify and
analyse the risks underlying the achievement of business
objectives, and to determine how such risks should be
managed and mitigated.