Articles: Corporate governance - general

Sound Global (0967) accidentally loses financial documents
Company announcement, 19-Jun-2017
How unfortunate. The company says an accident occurred when the documents were being transported to a new file storage facility. The company has been under investigation and suspended by the SFC since Apr-2016. A similar thing happened to China Animal Healthcare (0940) on 4-Dec-2015, while it was suspended and under forensic investigation. A truck loaded with 4 years of financial documents was stolen while the driver was on his lunch break.
MMT sanctions Yorkey Optical (2788), its CEO and Financial Controller for late disclosure of Inside InformationSFO s307Z
SFC, 28-Feb-2017
The CEO and company are each fined HK$1m. Ironically then, shareholders are paying for not being told about Inside Information. The HK Treasury gets HK$2m, but 115 investors who overpaid by HK$1.53m during a 13-week period get nothing. The SFC could claim for them under SFO s213, but has not. It appears investors in small-caps are on their own, and must make their own claims under SFO s307Z.
Facebook's investors criticize Marc Andreessen for conflict of interest
Bloomberg, 8-Dec-2016
Awful corporate governance at Facebook. Zuckerberg pushed through a scheme to create and distribute non-voting Class-C shares so that he can further reduce his investment without losing voting control. A so-called "independent committee" of 3 directors was established, including Andreessen, who secretly coached Zuckerberg on how to deal with them. Then he gets to vote it through at the shareholder meeting anyway.
C.P. Lotus (0121): Li Wen Hai is our Executive Chairman but not Chairman
Company announcement, 19-Sep-2016
This follows a complaint by Webb-site that the Articles of Association only allow for one Chairman. The "One Company, Two Chairmen" formula does not work.
Zall (2098): we have two Co-chairmen but our articles don't allow it
Company announcement, 14-Sep-2016
Zall clarifies that only one of them is responsible for the legal duties of Chairman, but they will try to amend the Articles. This follows a complaint from Webb-site that appointing two Chairman was ultra vires. It's the least of their problems though - the stock is in a bubble, in our view.
HKEx cuts hit corporate governance of whole market
A circular slipped out by an HKEx subsidiary, HKSCC, will slash the effective voting window for general meetings, reducing the participation of institutional investors in important decisions such as acquisitions, connected transactions and dilutive share issues. We urge HKEx to rethink this deeply damaging move. (18-Apr-2016)
Seeking the wisdom of crowds
Webb-site is proud to launch the World's first crowd-sourced governance ratings system. Now, with a single click, any logged-in user can anonymously contribute to the average rating of an organisation, including listed companies, governments and others. Also we are launching Webb-site Trust Ratings, where users can rate their trust in company directors, politicians, financial advisers or anyone they can find in Webb-site Who's Who. The system will only be as useful as users make it, so let's get started! (1-Feb-2016)
Principles of Responsible Regulation
Webb-site calls on the SFC, Government and HKEx to get serious about facilitating investor stewardship. Principles of Responsible Ownership are only useful if regulators address the deficiencies in Hong Kong's governance framework for listed companies. We call on readers to make a submission and support our proposed Principles of Responsible Regulation. (26-May-2015)
Government cites Webb-site board stats without attribution
The Government has cited statistics from Webb-site Who's Who without attribution, instead attributing them to SEHK. You're welcome. (25-Mar-2015)
What do investors want? Views from an activist investor
These are the slides from a presentation by David Webb to investor relations professionals in HK today at the National Investor Relations Institute (NIRI, USA) "Wisdom Roadshow" hosted by IPREO. (26-Sep-2014)
Citibank's response on vote-stuffing
Citibank has responded in a most disappointing way to yesterday's article, in essence shrugging its corporate shoulders and claiming to be just following instructions. That is not an excuse in the money-laundering arena, and it won't wash in the corporate governance arena either. (19-Jun-2014)
Webb on CNBC re Citibank, Yorkey and vote-stuffing
CNBC, 19-Jun-2014
Citibank vote-stuffing in HK AGMs
Webb-site has discovered that Citibank has been tilting the outcome of shareholder meetings in HK by giving blank proxies to management-nominated voters on behalf of Taiwan Depositary Receipts for which it has no voting instructions. We call on Citibank to stop this outrageous practice and on the HKMA and SFC to ensure that the HK branch does so. (18-Jun-2014)
Videos from SFC regulatory conference published
SFC, 1-Apr-2014
Webb-site editor David Webb appears in Panel 3, Market Integrity and Investor Protection, with David Graham, Head of Regulation at HKEx, Andrew Procter, Group Head of Compliance at Deutsche Bank, William Strong, Co-CEO of Morgan Stanley Asia-Pacific, and Keith Yeung, Director of Public Prosecutions, HK Government. The moderator is Mark Steward, Head of Enforcement at the SFC. The conference was held on 24-Jan-2014.
What the UK should learn from Jardines
Jardine group is downgrading its UK Listing, lowering minority rights and governance standards. The controller can vote, sealing the deal for 4 companies, but minorities of Hongkong Land could save themselves from this fate. Once downgraded, full listing cancellation requires no vote. We make recommendations to London's FCA based on HK's successful 2002 reforms to avoid a Hobson's Choice of a low buyout offer or holding delisted shares. (27-Mar-2014)
Women on boards flatlineData
Community Business, 4-Mar-2014
The report shows that women held 9.6% of HSI board positions at 2-Jan-2014. Across all HK-listed boards, Webb-site Who's Who shows the figure at 10.9%. The report is sponsored by Standard Chartered plc (2888), which has 9.5% female directors (2/21). StanChart is also a big sponsor of HK's 30% Club run by the Women's Foundation. "Do as we say and not as we do..."
Community Business Ltd responds to Webb-site article on gender diversity
Company media release, 22-Jan-2014
We note that 15 of the 16 staff listed on their "About Us" page are women - a severe lack of gender diversity!
Does gender diversity add value to HK boards?
We present empirical evidence, using the Webb-site Total Returns series on all stocks and Webb-site Who's Who for all boards in HK over the last 10 years to 2013. (17-Jan-2014)
Women and the size of HK boards
Webb-site has completed a database on HK-listed boards since 1990. We begin a series of analyses on board composition, starting with the number and proportion of women on boards, and the size of boards in response to changing rules on the number and proportion of "independent" directors. (13-Sep-2013)
Webb interviewed on Malaysian radio
BFM radio (Malaysia), 9-Apr-2013
HKEx chief calls for muddier water in China
Company web site, 2-Apr-2013
Charles Li of HKEx (0388): in China, "there is very little flexibility, if any, for broker-dealers to move funds across client accounts, let alone embezzle funds or engage in other malpractice...there is no incentive for financial institutions to innovate". At Webb-site, we think that embezzlement of client funds and other malpractices are the kind of innovative broking we can do without. Does he also think that more listed company disclosure would reduce the potential for "innovative" insider dealing by making the water "too clean"?
Current issues in HK-listed corporate governance
A presentation by David Webb at a conference in HK. (27-May-2011)
Building a Value Proposition for HK
HK Chief Executive Donald Tsang recently convened an Economic Summit of 33 people, which spawned 4 focus groups, including one on financial services, which in turn produced 3 working groups, one of which, headed by HKEx government-appointed director and Chairman Ronald Arculli, has sought submissions on the markets. This is our submission. (4-Oct-2006)
Avoiding the Logjam
Hong Kong is gradually being submerged in a landslide of printed IPO prospectuses, some running to almost 1,000 pages in bilingual form. Webb-site.com proposes a solution which can be quickly implemented and avoids a long wait for enabling legislation. (26-Sep-2006)
Yes, there is a Governance Premium
Researchers studying the corporate governance of 168 of Hong Kong's largest listed companies have found a positive and significant correlation between corporate governance score and price-to-book ratio. We bring you their paper. (22-Jun-2005)
DHL/SCMP's Sell Signal
We've found it - the best contra-indicator of performance for HK stocks yet - the DHL/SCMP Business Awards. Sitting at the awards dinner on Thursday night during a particularly boring speech, we had time to read the track record of these awards, which looks like a corporate graveyard of Hong Kong, with a good measure of walking wounded. Remember names like Siu-Fung Ceramics, Peregrine Capital, Akai Holdings and PCCW? They're all there, and more... (12-Dec-2001)
CLSA's Pioneering Work
By kind permission of CLSA Emerging Markets, Webb-site.com makes available for our readers their ground-breaking report, "Saints & Sinners", which includes corporate governance ratings of 495 stocks in their core coverage of 25 emerging markets. And if you are a CLSA client, find out more about our work in a global series of presentations hosted by the firm next week. Read on... (10-Jul-2001)
HAMS - Representing Minority Shareholders
Webb-site.com outlines our proposal for filling the vacuum of shareholder activism in Hong Kong. Investor rights are only of value if shareholders exercise them, and we explain how HAMS - the Hongkong Association of Minority Shareholders, would lobby for those rights, exercise them on members' behalf in quasi-class actions, and through Corporate Governance Ratings, incentivise good governance and deter shareholder abuse. Hong Kong can only maintain its regional financial market status and economic competitiveness if this void is filled. We'll also tell you how you can help. (4-Mar-2001)

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