With fresh reforms and rules, HKEX seeks to attract new listings
Changes to board representation and listing rules are aimed at making Hong Kong a more attractive listing destination, HKEX says
Hong Kong Exchanges and Clearing (HKEX), which runs the world’s fourth-largest stock market, unveiled a raft of listing reforms and governance rules, as it seeks to strike a balance between issuers and investors and boost market quality to reboot the city as a preferred venue for new listings.
Each independent non-executive director (INED) will now be allowed to sit on only six boards from July next year, the HKEX said on Thursday, pressing ahead with the controversial proposal made in June. Companies in breach of the limit will be given a three-year grace period to rectify the situation. Twenty-three INEDs sit on more than six boards at present, according to HKEX data.
The exchange, however, decided to delay the transition period for banning companies from hiring an INED who has been on a board of directors for nine years. The nine-year limit will now be implemented in 2032 instead of 2028, it added.
These changes were aimed at enhancing corporate governance, CEO Bonnie Chan Yiting said in June.
The new rules on INEDs “will bring new and more diverse perspectives to the boardroom, thereby strengthening overall board effectiveness, independence and diversity,” said Katherine Ng, head of listing. “These enhancements align with heightened global investor expectations on governance standards.”
