Cathay Pacific replaces CE as China ups pressure over protests

Cathay Pacific replaced its CE Friday after Beijing moved to pull Hong Kong businesses into line over anti-government protests that have plunged the territory into its worst political crisis in decades. The decision to replace chief executive Rupert Hogg followed an accusation from Beijing’s aviation regulator that Cathay was putting flight safety at risk after several of the airline’s employees allegedly participated in the protest movement. In an unprecedented development for a Hong Kong private sector company, the management change was first revealed by mainland Chinese state-run media rather than Cathay. “Recent events have called into question Cathay Pacific’s commitment to flight safety and security and put our reputation and brand under pressure,” John Slosar, the company’s chairman, said in a statement. “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.” Hong Kong’s flag carrier has become the most high-profile business in the international financial hub to be caught between Beijing and customers in mainland China, and its Hong Kong staff and protesters in the territory. The anti-government protests started as opposition to a proposed extradition law but have since expanded to include democratic reforms. This has drawn the ire of Beijing, which has massed paramilitary police on the border, sparking fears of military intervention. According to a stock exchange filing from Cathay, Hogg “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”. “This is my first time seeing something like this happen . . . over my career here in Hong Kong covering stocks,” said Ivan Su, an analyst at Morningstar. “We are talking about a Hong Kong company, not a Chinese company. This happens with Chinese companies.” The replacement of Mr Hogg represents a U-turn for Cathay, whose chairman, John Slosar, last week defended his employees' freedoms even as calls for a boycott of the airline circulated on Chinese social media.<br/>