Cathay Pacific Airways CEO resigns, the airline's board blames 'recent events'

Key Points
  • Cathay Pacific is to replace both its CEO and Chief Customer and Commercial officer.
  • The airline said CEO Rupert Hogg was stepping down "in view of recent events."
  • Cathay Pacific has been under pressure from Beijing after it was found that two of its pilots had become involved in the current protest in Hong Kong.
Rupert Hogg, chief executive officer of Cathay Pacific Airways Ltd., attends a news conference in Hong Kong, China, on Wednesday, Mar. 13, 2019. The airline announced Hogg's resignation on Mar.16.
Bloomberg | Bloomberg | Getty Images

The CEO of Hong Kong airline Cathay Pacific, Rupert Hogg, is to step down as the company's leader "in view of recent events."

The airline has been under huge 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 then said to have misused company information related to the protests. Both were subsequently sacked by the airline.

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

"He 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," added the statement.

From Monday, Hogg will be replaced by Augustus Tang. The airline also confirmed that Paul Loo has resigned as an Executive Director and Chief Customer and Commercial Officer and, on Monday, will be replaced by Ronald  Lam.

In a separate statement issued by the airline, outgoing CEO 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."

Cathay's chairman, John Slosar, added that it was time to put "a new management team in place who can reset confidence".

What Hong Kong's protests may mean for businesses

On Wednesday, the airline announced that it had fired two pilots it had previously suspended. One had been arrested and charged over clashes between police and anti-government protesters on July 28.

Meanwhile, it was revealed that another cockpit crew member was said to have been suspended for misusing company information by posting on social media details of Hong Kong police officers travelling on the airline.

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."

Protests in Hong Kong are now several weeks old and have morphed from concerns over an extradition bill into wider concerns about basic freedoms and the level of control coming from Beijing.

Hong Kong is a Chinese territory of 7.4 million people which was formerly part of the British Empire. It has been a specially administered region of China since July 1, 1997.

It has its own government, currency, police force and civil service but mainland China handles foreign affairs and defense.

At the conclusion of its statement Friday, the airline loosely referenced the tension that has crippled the financial hub for almost 3 months.

"Cathay Pacific is fully committed to Hong Kong under the principle of 'One Country Two Systems' as enshrined in the Basic Law. The Company is confident that Hong Kong will have a great future."

The board changes were announced after the close of Friday trade on Hong Kong's Hang Seng index.