Asia Business Channel

Cathay Pacific Airways CEO resigns

 

Rupert Hogg, the CEO of Hong Kong airline Cathay Pacific, has resigned as the company’s leader “in view of recent events.”

Cathay Pacific had found itself to be under intense political pressure from Beijing after one of its pilots was found to have taken part in the ongoing protests in Hong Kong, another pilot was said to have misused company information related to the protests and other staff were photographed in uniforms supporting the protestors at the airport. In response, both pilots and two other staff have now been fired by the airline.

Cathay Pacific’s board confirmed in a statement to the Hong Kong Stock Exchange on Friday that Hogg would step down as CEO despite there not being any matter that shareholders needed to be made aware of.

The statement said in part, “He (Hogg) has also confirmed that he has resigned to take responsibility as a leader of the Company in view of recent events and that he is not aware of any disagreement with the Board.” The airline also confirmed that Paul Loo has resigned as an Executive Director and Chief Customer and Commercial Officer.

August Tang will replace Hogg, and Ronald Lam will replace Loo, with both executives starting their new positions on Monday.

In a separate statement Hogg said: “These have been challenging weeks for the airline and it is right that Paul and I take responsibility as leaders of the company.”

Last week, the Civil Aviation Authority (CAA) of China issued a warning to Cathay Pacific, related to the pilot actions, describing them as a “major aviation safety risk” and said that the airline must provide lists of staff on flights flying into China or across Chinese airspace and that the government would refuse flights that had staff onboard that had participated in or supported the protests.

The company has drawn the ire of Chinese state media, notably the English language Global Times, which has repeatedly criticized the airline and the hashtag #boycottcathaypacific has been shared more than 10 million times on Weibo.

John Slosar, Chairman of Cathay Pacific, said in a statement that, “recent events have called into question Cathay Pacific’s commitment to flight safety and security and put our reputation and brand under pressure. We therefore think it is time to put a new management team in place who can reset confidence and lead the airline to new heights.”

Slosar added: “Cathay Pacific is fully committed to Hong Kong under the principle of ‘One Country Two Systems’ as enshrined in the Basic Law. We are confident that Hong Kong will have a great future.”

Business and financial analysts note that Cathay Pacific’s stock is down almost 25% since April and that the airline is facing the worst crisis in its history. Simply put, the airline derives over 70% of its revenue by flights into or over China and simply can’t fight the mainland government.

 

 

 

Read 35