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Corporate Governance

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Corporate Governance
We are committed to sound corporate governance and our systems and procedures are outlined in the Cathay Pacific Code of Conduct on Corporate Governance. We devote considerable time to identifying risks and ensuring that we put in place best practice to mitigate those risks

"At Cathay Pacific we have taken steps to lead on many sustainability challenges, our involvement in the Aviation Global Deal on environmental targets being a key example of this. Leading in this way will help to deliver success for our business and all its stakeholders. My Sustainable Development Steering Committee understands the important role it plays as it works carefully and seriously on the priority areas for action."

John Slosar, Chief Executive

The highest governance body is the Board of Directors led by the Chairman and comprises the Chief Executive and five other Executive Directors. There are also 12 non-Executive Directors, four of whom are independent. As well as having responsibility for our economic performance, the Board oversees the environmental and social initiatives undertaken in the company. More information can be found in our 2010 Annual Report, under the Corporate Governance Section (p.42-46).

Key issues raised by stakeholders on Governance
Role of the highest levels of management to take a leadership position on sustainability issues in the company and within the industry.
Governance of Sustainability

The Chief Executive is accountable for Cathay Pacific's Sustainable Development Strategy. This Strategy is in place to help create long-term value by embedding sustainable development principles and practices into the way we govern the company, manage risk and seize opportunity. Our Sustainable Development Steering Committee, chaired by the Director Corporate Affairs, comprises General Managers and Heads of Department representing safety and security, finance, corporate risk, sustainability management, purchasing, marketing, customer services, property and services, engineering, cargo, ground services and personnel, and reports directly to the Management Committee. Our governance structures are linked to the Swire Group's Environment and Risk Management Committees for internal audit purposes.

In 2010, the Committee convened to resolve actions on strengthening the Sustainable Development Strategy and cascading it through the company, revising the Supply Chain Code of Conduct, discussing our carbon offset programme, responsible food sourcing and working with Swire at a strategic level.

A Long Term Action Group on Climate Change, chaired by the Director Corporate Development, considers the long-term implications of climate change and the development of long-term action plans. This is linked to the Fleet Steering Group, which is also guided from the Director level. Each working group in Cathay Pacific must show how sustainable development relates to commercial value, how it contributes to our overall Vision and demonstrate ways to embed sustainability in each part of the business using short, medium and long-term targets, stakeholder engagement and risk assessment.

These arrangements push forward the tenets of our Sustainable Development Strategy and new, smaller and more agile sub-groups are being formed to work on particular issues.

The company has also put in place corporate governance practices to meet the recommended best practices in the Code on Corporate Governance Practices in the Listing Rules for the HK Stock Exchange.

We regularly review our remuneration policies in considering local legislation, industry practice, market conditions and the performance of individuals and the company. In 2010, external advisors confirmed that the remuneration of the company's Executive Directors was in line with its peer group companies.

Cathay Pacific/Swire committees related to the Environmental Affairs Department

Cathay Pacific/Swire committees related to the Environmental Affairs Department