{"id":6870,"date":"2023-03-29T05:53:33","date_gmt":"2023-03-29T05:53:33","guid":{"rendered":"https:\/\/www.boardroomlimited.com\/hk\/?p=6870"},"modified":"2024-10-09T14:09:17","modified_gmt":"2024-10-09T06:09:17","slug":"great-corporate-governance-starts-with-a-skilled-company-secretary","status":"publish","type":"post","link":"https:\/\/stg.boardroomlimited.com\/hk\/great-corporate-governance-starts-with-a-skilled-company-secretary\/","title":{"rendered":"Great corporate governance starts with a skilled company secretary"},"content":{"rendered":"

[vc_row full_width=”stretch_row” css_animation=”fadeInLeft” el_class=”business-insights-content”][vc_column][vc_row_inner][vc_column_inner][vc_column_text el_class=”m-b-30″]The COVID-19 pandemic altered the business landscape of marketplaces worldwide. Adapting to continual uncertainty and change has been necessary for survival. However, as we enter a new age of economic promise, Asia-Pacific enterprises are taking a proactive approach to corporate governance in order to assure a bright future for themselves and the larger economy.<\/p>\n

In this article, Samantha Tai, Regional Managing Director for Corporate Secretarial, outlines the significance of corporate governance in Hong Kong. She further discusses how leaders may build values-based governance procedures in order to achieve outstanding results. In addition, we look at how the company secretary may advise and execute best-practice corporate governance measures to full effect.[\/vc_column_text][vc_custom_heading text=”What is corporate governance?” use_theme_fonts=”yes” el_class=”m-b-20″][vc_separator color=”custom” align=”align_left” border_width=”3″ el_width=”10″ accent_color=”#4f9e45″ el_class=”m-b-20″][vc_column_text el_class=”m-t-20″]The meaning of corporate governance at the organisational level is to achieve superior performance, behave with integrity and maximise value to stakeholders. Companies that adhere to corporate governance norms are more likely to satisfy company goals, attract investment and outperform their rivals.<\/p>\n

Significantly, the adoption of group-wide good corporate governance reduces the possibility of wrongdoing and consequent punishment.<\/p>\n

In Hong Kong, the Prevention of Bribery Ordinance (POBO) sets out provisions for the prevention of bribery and for purposes thereto and connected therewith. Through the introduction of new code provisions under the Corporate Governance Code as set out in Appendix 14 to the Main Board Listing Rules and Appendix 15 to the GEM Listing Rules, that came into effect on 1 January 2022, all issuers have to establish an anti-corruption policy. For this reason, \u201ccompanies need to make sure they have adequate procedures in place\u201d, Samantha says.<\/p>\n

Corporate governance is not a legal necessity for all Hong Kong enterprises, but Samantha believes that its link with fiduciary obligation makes it a crucial investment for every leader.<\/p>\n

“We open BoardRoom training sessions in Malaysia by discussing a director’s fiduciary obligation to the Commonwealth to always prioritise the best interests of the firm, minimise conflicts of interest and act in good faith,” she explains.[\/vc_column_text][\/vc_column_inner][\/vc_row_inner][vc_row_inner el_class=”m-t-20″][vc_column_inner width=”1\/2″][vc_column_text el_class=”m-b-50″]”In Hong Kong, fiduciary obligation is taken very seriously, with authorities taking action against directors who fail to fulfil their responsibilities \u2013 including independent directors.”<\/p>\n

Successful corporate governance frameworks include the creation of customised policies and their subsequent execution.<\/p>\n

The corporate secretary is normally in charge of this duty.[\/vc_column_text][\/vc_column_inner][vc_column_inner width=”1\/2″][vc_single_image image=”6918″ img_size=”full” alignment=”center” alt=”AGM Logistics” css=”.vc_custom_1679905863129{padding-right: 30px !important;padding-bottom: 30px !important;padding-left: 0px !important;}”][\/vc_column_inner][\/vc_row_inner][vc_custom_heading text=”The role of company secretaries in promoting corporate governance” use_theme_fonts=”yes” el_class=”m-b-20″][vc_separator color=”custom” align=”align_left” border_width=”3″ el_width=”10″ accent_color=”#4f9e45″ el_class=”m-b-20″][vc_row_inner][vc_column_inner][vc_column_text el_class=”m-b-30″]Historically, the corporate secretary was a primarily administrative role and held minimal influence with the board. Today however, as a member of senior management and a statutory officer, the company secretary now handles various critical obligations for the organisation.<\/p>\n

Company secretaries act as a connection between the board of directors, senior management and the company’s stakeholders (including regulatory bodies). This is in addition to their role in administrating crucial undertakings such as minutes taking, secretarial compliance and also company incorporation<\/a>. Other duties include utilising digital technology, such as board management and ESG software, to strengthen board and shareholder procedures and improve corporate governance. Furthermore, because they are well-versed in local laws, they can guarantee that corporate governance standards are established, followed and evaluated on a regular basis.<\/p>\n

The present responsibilities of the company secretary, according to Samantha, are clearly defined in the Corporate Governance Guide for Boards and Directors<\/a>.<\/p>\n

“In Hong Kong, the company secretary’s views on corporate governance are sought since they attend all board meetings, are familiar with relevant regulations and understand compliance needs,” she explains. “They advise the board on corporate governance practices that must be implemented. This might be related to the board’s structure or the company’s rules and code of ethics.”<\/p>\n

They also assist publicly traded corporations in demonstrating corporate governance in their annual reports, including any alternative means utilised to attain the same goals.<\/p>\n

Company secretarial responsibilities have become so synonymous with corporate governance that the Institute of Company Secretaries in the United Kingdom and the Institute of Chartered Secretaries and Administrators in Australia have both rebranded to the ‘Chartered Governance Institute’, with other regions expected to follow suit.[\/vc_column_text][\/vc_column_inner][\/vc_row_inner][vc_row_inner][vc_column_inner width=”1\/2″][vc_column_text el_class=”m-b-50″]In Hong Kong, The Hong Kong Chartered Governance Institute unveiled its new brand identity in Jan 2022. Aiming to reflect its unique position and critical role as highly qualified experts in corporate governance in Hong Kong and the Mainland China, and as the China Division of the Chartered Governance Institute, an international organisation with nine Divisions globally.[\/vc_column_text][\/vc_column_inner][vc_column_inner width=”1\/2″][vc_single_image image=”6916″ img_size=”full” alignment=”center” alt=”AGM Logistics” css=”.vc_custom_1679905873047{padding-right: 30px !important;padding-bottom: 30px !important;padding-left: 0px !important;}” el_class=”m-h-330″][\/vc_column_inner][\/vc_row_inner][vc_custom_heading text=”How to elevate your corporate governance” use_theme_fonts=”yes” el_class=”m-b-20″][vc_separator color=”custom” align=”align_left” border_width=”3″ el_width=”10″ accent_color=”#4f9e45″ el_class=”m-b-20″][vc_row_inner][vc_column_inner][vc_column_text]Good corporate governance will become increasingly crucial in the coming years, with regulators anticipated to issue new guidelines for both public and private companies. Organisations that maintain best-practice standards as they develop will be well positioned to seize new opportunities and fulfil market needs.<\/p>\n

You may lead your organisation to better corporate governance by implementing the actions outlined below.[\/vc_column_text][vc_custom_heading text=”1. Obtain the services of a qualified company secretary in Hong Kong” font_container=”tag:h3|text_align:left” use_theme_fonts=”yes” el_class=”m-t-30 m-b-20″][vc_column_text]The first step toward better corporate governance is ensuring that your company follows existing standards and best practices, notably those outlined in the Hong Kong Stock Exchange Limited\u2019s Corporate Governance Code<\/a>. This includes assisting companies to adopt the new standards when they come into effect.<\/p>\n

“Because they must report to the stock exchange, publicly traded firms already require corporate governance,” Samantha says. “However, they must now guarantee that corporate governance is practised in all of their subsidiaries as well \u2013 regardless of whether the subsidiaries are also listed firms or headquartered in Hong Kong or elsewhere.”<\/p>\n

To meet this criterion, an experienced company secretary would assist in the development of a group-wide corporate governance structure. A code of conduct would be included, as well as rules and processes for corporate governance issues such as whistleblowing, anti-corruption, board diversity and sustainability.<\/p>\n

Company secretarial service<\/a> providers are a popular choice for executives who want to know that they will receive expert advice that is specific to their organisation.<\/p>\n