The Securities and Futures Commission (SFC) has launched a three-month consultation period commencing on 2 March 2015 on the proposed Principles of Responsible Ownership (Principles). The principles are proposed to operate on a non-binding and voluntary basis and investors in Hong Kong listed companies will be encouraged to comply, or to explain why some, or all, of the Principles do not apply to them.

The Principles aim to guide investors in fulfilling their share ownership responsibilities with regard to their investment in a Hong Kong listed company, whether ownership is direct or through intermediaries. The Principles provide key guidance points with which investors should comply whilst owning shares. Investors are encouraged to:

  • establish policies for discharging ownership responsibilities
  • report to their stakeholders on how and when they have discharged such responsibilities
  • establish policies on when to escalate their engagement activities
  • monitor and engage with their investee companies
  • act collectively with other investors when necessary
  • establish policies on voting and conflict of interest management.

The consultation period closes on 2 June 2015.