Accelerating change

We see a lot of change everywhere. In this context, people are becoming quite rightly much more aware of what is sustainable and what that means to us.

In 2016, we achieved important sustainability milestones, which will allow us to accelerate our performance in the years ahead.

In a changing world, we need to be agile, focused and innovative. We are prepared to meet the challenges that lie ahead, but we are also confident that we can lead our industry into this exciting new era.

Performance highlights

HKD 92,751million

in revenue was generated by passengers that travelled with us in 2016, attributable loss of HKD 575 million.

78,830flights

were undertaken by Cathay Pacific and Cathay Dragon in 2016.

202aircraft

Including 10 new A350-900s that were delivered to us in 2016.

Biofuels

In 2016, our first Biofuel flight was the
world’s longest

Bringing our A350-900s home using a 10% blend of Biofuel.

Greenhouse gas emissions

In 2016, Cathay Pacific and Cathay Dragon emitted
17.2million tonnes

of CO2, an increase of 0.8% from 2015.

Our total fuel efficiency increased by
24.9%

in traffic carried* and by 16.8% in capacity** since 1998.

* Available tonne kilometre, ATK
** Revenue tonne kilometre, RTK

Inflight waste recycling

In 2016, we recycled
22,066kg

aluminium cans.

10,799kg

plastic cups.

20,242kg

plastic bottles.

517,048kg

wine bottles.

Our People

35,990people

employed around the world.

47% male
53% female

Communities

Over
1,400 hours

were donated by our volunteers in 2016.

HKD165million

raised by Change for Good for UNICEF in the past 25 years, helping children in more than 150 developing countries around the world. Around 18 tonnes of coins were received in 2016.

Safety

Recognition as a
Leader

in the 2016 Jet Airliner Crash Data Evaluation Centre (JACDEC) airline safety ranking.

Sustainable development recognition

A constituent of the FTSE4Good Index Series for the 6th consecutive year.

A constituent of the Hang Seng Corporate Sustainability Index since index inauguration.

Cathay Pacific and Cathay Dragon have been recognised as Caring Company for 15+ years and 10+ years respectively.

5 ways we accelerated change in 2016

2016 provided a challenging operating environment, but it was also a year of great opportunities, expansion and progress. Dragonair made the transition to Cathay Dragon, we introduced new and exciting destinations to our ever-growing global network, we said goodbye to the iconic Boeing 747 (from the passenger fleet), and we welcomed in the Airbus A350-900 to our ultra-modern fleet. All of this played a part in allowing us to push ahead with significant sustainability efforts, which has laid the foundation for accelerated growth going forward.

New Airbus A350s will accelerate carbon efficiency

We began receiving our new next-generation aircraft – the Airbus A350-900 – in 2016. The A350 is an important aircraft. Not only does it provide superior inflight products – including Wi-Fi connectivity, upgraded seats in all classes and a better entertainment system – for our passengers, it delivers significantly enhanced environmental performance. Our A350s, combined with the retirement of some of our older aircraft, will allow us to accelerate our airline’s fuel efficiency and reduce emissions going forward.

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First ever CX flights on biofuels

By partnering with TOTAL, Amyris and Airbus, we were able to fly all of our brand-new A350s from Toulouse to Hong Kong using a blend of biofuel and regular fuel. We are happy to report that these flights – all ten during 2016 – were the world’s longest recorded flights using biofuel to date.

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Supported landmark global aviation deal on carbon offset

2016 was a historic year for the global aviation industry, with 191 states passing a resolution at the International Civil Aviation Organization (ICAO) for carbon neutral growth from 2020 – something Cathay Pacific has been closely involved with since the discussions for a coordinated global scheme commenced in 2008.

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Signed the United for Wildlife Transport Taskforce Buckingham Palace Declaration

We were among 20 airlines from around the world that signed the United for Wildlife Declaration, a collaboration between seven of the largest international conservation organisations whose focus is to end illegal wildlife trade together.

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Continued to improve inflight sustainability with sustainable products

If you have flown with us during 2016, you would have likely been in direct contact with some of our new sustainable products already. These included our comfortable inflight blankets (provided in all classes) – which are thoughtfully made from recycled plastic materials - and the napkins you are provided with at every meal. These are made from 70% sugarcane material.

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5 Ways We Accelerated Change in 2016

New A350s introduced with step change efficiency and environmental improvements

In 2016, we took delivery of 10 Airbus A350-900XWB aircraft, which are equipped with our latest cabins, seat entertainment systems and inflight connectivity. The combination of advanced aerodynamics, lightweight composite materials and the latest Rolls-Royce Trent XWB engines resulted in a 25% reduction in fuel burn compared to existing wide-body aircraft. As well as reducing operating costs, the highly efficient A350 also benefits the environment, with a corresponding cut in CO2 emissions, reduced NOx emissions and a smaller external noise footprint.

5 Ways We Accelerated Change in 2016

First ever CX flights on biofuels

The first Cathay Pacific flight powered by biofuels arrived at HKIA in May. This flight was operated on a newly delivered Airbus A350-900 and was the world’s longest biofuel flight to date. The following 21 delivery flights from Toulouse will also use a 10% blend of biofuel. This biofuel is made from sustainable sugars, using a process of fermentation whereby modified yeast produces hydrocarbons that can be processed into jet fuel. Not only does this fuel have a lower life cycle CO2 than fossil fuel, but biofuel also burns cleaner. The intent of using biofuel on these flights is for Cathay to become accustomed to flying on renewable fuel as we move closer to larger volumes becoming available over the next three to five years.

The combination of a modern fuel-efficient aircraft and the use of biofuels will result in some of the lowest net CO2 emissions for commercial aircraft in service today.

Jeff Ovens

Bio Fuel Procurement Manager

5 Ways We Accelerated Change in 2016

Supported landmark global aviation deal on carbon offset

Since 2008, Cathay Pacific, along with other industry players, has been calling for the regulation of aviation emissions from a global sectoral scheme, under the United Nation’s International Civil Aviation Organization (ICAO). We believe a sectoral approach is more appropriate and effective for the global nature of the industry, rather than through regional schemes such as the EU ETS.

In 2014, ICAO began the development of a Global Market Based Measure (MBM) to address the growth of international aviation emissions.

In October 2016 at the ICAO 39th Assembly, global aviation industry reached a landmark climate agreement to put in place the world’s first mandatory carbon offsetting scheme covering an entire industry. This is an important regulation that will require all international airlines to offset industry’s growth in carbon emissions, which is set to commence in 2020. This will help towards achieving the industry target of carbon neutral growth (CNG) by 2020.

We are active members of several global groups, such as the Global Market-based Measure Technical Task Force (GMTF), which comprised representatives from ICAO member states, industry and NGOs. Cathay Pacific is continually and proactively engaging in dialogue revolving around the implementation of a global MBM for aviation emissions under ICAO. We are part of a small group of IATA carriers that are members of the expert groups looking at specific technical aspects of a global MBM through the ICAO Advisory Committee on Environmental Protection (CAEP), together with NGOs, states and academia. We are also part of IATA’s advisory group that supports the industry’s efforts in ICAO to develop a global MBM.

Significant progress was made in 2016 on the historic 39th Assembly Resolution and we will continue to involve ourselves closely in the process.

As an expanding and growing airline, we will likely need to offset a proportion of our emissions post 2020. However, our investment in biofuels and efficient aircraft such as the Airbus A350 and Boeing 777-9X will help reduce our emissions and offset obligations.

5 Ways We Accelerated Change in 2016

Signed the United for Wildlife Transport Taskforce Buckingham Palace Declaration

Recognising the devastating impact from illegal and inhumane wildlife trade, Cathay Pacific signed the United for Wildlife Transport Taskforce Buckingham Palace Declaration in June 2016.

This industry-led declaration, which initially targeted the illegal trade of African elephants, rhinos, some big cats, and pangolins that originated from and transited through East Africa, was developed by the transport sector, intergovernmental organisations and conservation groups in order to ultimately put an end to illegal wildlife trade. United for Wildlife (UFW) is a joint collaboration between seven of the largest international conservation organisations, namely Conservation International, Fauna & Flora International, the International Union for Conservation of Nature (IUCN), The Nature Conservancy, Wildlife Conservation Society (WCS), WWF and the Zoological Society of London (ZSL). UFW aims to implement a global action plan whereby organisations and government partners can work in unison to finally end all wildlife related crimes.

As a signatory to the declaration, Cathay Pacific is committed to not facilitating or tolerating the carriage of wildlife products, where the trade is contrary to CITES and as such, is illegal under international and national laws.

The declaration contains commitments which focus on information sharing, staff training, technological improvements and resource sharing across companies and organisations worldwide. Cathay Pacific will be working closely with IATA and the International Taskforce on the Transportation of Illegal Wildlife Product to identify the role that the industry plays in the illegal wildlife trade, and to find ways that help break the chain between its suppliers and consumers.

As a reputable commercial airline, we cannot tolerate transporting illegal wildlife product in our aircrafts. As such, we have the responsibility to increase the awareness of our staff, customers and associates on the magnitude and implications of illegal wildlife trade.

Paul Loo

Chief Customer and Commercial Officer

5 Ways We Accelerated Change in 2016

Continued to improve inflight sustainability with sustainable products

Blankets made from recycled plastic bottles

In 2016, Cathay Pacific introduced new blankets for our Economy Class passengers that are made entirely from recycled plastic bottles. Each year we use over 450,000 blankets, and therefore this initiative enables us to contribute significantly towards the reduction of plastic waste.

Napkins made from sugarcane

We introduced a new type of napkin that is more environmentally friendly, yet does not compromise on size, thickness and overall product quality. This new cocktail napkin, introduced to customers in November 2016, is made from 70% sugarcane and 30% wood pulp.

Sustainable inflight cocktail snacks and inflight catering

Our sustainability procedures extend to our inflight services, which is highlighted through our transition towards a new supplier of roasted peanuts. The new selected supplier follows the requirements to use sustainably produced palm oil as stated in our tender. Developed by the Roundtable for Sustainable Palm Oil, Certified Sustainable Palm Oil must meet a set of environmental and social criteria to help minimise any negative impacts such as deforestation whilst protecting the rights of indigenous people.

Our team also works with suppliers who assist us in expanding our inflight catering. They offer sustainably sourced seafood on a greater number of routes. In the long term, we aim to utilise alternatives with sustainability attributes. In addition, we aim to expand our support of products that adhere to the relevant sustainability credentials by organisations such as the Fairtrade Foundation, the Forest Stewardship Council (FSC) and the Marine Stewardship Council (MSC).