CGC 2014: join the debate
CSj previews the Institute’s ninth biennial corporate governance conference which gets underway next month in Hong Kong.
The Institute’s biennial corporate government conferences (CGCs), first launched in 1998, have established a reputation for their very practical approach to emerging corporate governance issues. Next month the ninth conference in this series gets underway in Hong Kong. True to form, the CGC 2014 has set itself some hard questions to answer. Peter Greenwood FCS FCIS, who will be the Conference Chair, worked closely with Mohan Datwani FCS FCIS, the Institute’s Director of Technical and Research, to devise a theme which is topical, relevant to the work of practitioners, but also forward-looking.
‘Over the years we have always tried to have an orientation for the conference which is forward-looking; preparing our members and attendees for things that are likely to come up in the years to come, rather than things that they have already had to deal with,’ Greenwood says. He adds that the Institute’s conferences like to take aim at a theme with broad relevance to corporate governance and corporate secretarial professionals.
‘We have the advantage of a very wide range of speakers, giving us a wide perspective both in terms of profession and in terms of their local and international outlook. So what we have tried to do with the conferences is to bring together broad perspectives to look at things that are coming in and that are likely to impact the way our profession moves and upgrades.’
At a time of intensive, ongoing legal, regulatory and market change, the rules or practices which impact corporate governance professionals are developing rapidly, and with that the roles of those professionals are similarly evolving and expanding. The theme this year – ‘Changing rules, changing roles, managing it all’ – will address this rapidly changing environment.
‘It is no longer a matter of performing our duties in new ways,’ says Greenwood, ‘the nature of those duties and the scope of our responsibilities is changing, especially for company secretaries, but also for all engaged governance professionals.’
Keep it relevant
Covering the changing regulatory environment and the changing roles of governance professionals in a single day – the second day of the conference will be devoted to site visits (see the conference programme on pages 20-21) – will be no small undertaking, but the four sessions of the conference have been designed tofocus on specific aspects of this overall theme as outlined below.
Session one: the long arm of the law
Corporate governance codes started life as guidance to directors on best practice – today many areas of corporate governance are subject to mandatory regulation or legislation – is this the right approach? The first session of the conference will consider the extent to which the law now applies to areas of governance which hitherto might have been left to regulation, market practice or even individual choice. ‘The law is reaching into the governance of companies, deeper and further than it previously has,’ says Greenwood.
Session two: competing to win
The second session will look at the potential impact of Hong Kong’s new competition law, bearing in mind that this is an area where many companies will have little or no practical experience. ‘Companies in Hong Kong are going to have to be highly sensitive about the competition implications of what they do,’ says Greenwood, ‘and the company secretary is probably as well placed as anyone to bring in a degree of awareness to the board about the potential implications of what the board is discussing in terms of anti-competitive behaviour.’ No one expects the company secretary to be an instant expert anti-trust lawyer, he adds, but the company secretary needs to have ‘red flag sensitivity – a finely tuned nervous system that twitches when the board is moving into areas that might be delicate or problematic’.
Session three: board shoulders, broad shoulders
We have seen in recent years increasing expectations being placed on directors via both regulation and legislation. The third session of the conference will consider how the duties and responsibilities of company directors, together with those of the corporate governance professionals who serve as their ‘minders’, are evolving and expanding. In Hong Kong directors are often appointed by, and are often associates of, the majority shareholder, but the duties now being placed on them by law and by the regulators require them to act on behalf of all the shareholders, and in many cases the minority shareholders in particular.
Session four: winds of reporting changes
The fourth and final session of the day will consider the trend towards wider disclosure of corporate information beyond the traditional scope of accounting and financial data as companies are called upon to explain the social and environmental aspects of their activities, not just to shareholders, but to a wider, less definable, stakeholder group. A Hong Kong listed company needs to be just as committed to, and expert at, reporting on its environmental and social performance as it is on its financial performance, Greenwood points out. That demands new skills and it requires the company secretary to ensure that the board is discussing the environmental and social aspects of the business.
Keep it lively
The theme is not, of course, the only thing a successful corporate governance forum needs to get right. Over the years, the Institute’s CGCs have learned that approaching a serious subject with a degree of humour and with a healthy dose of iconoclasm results in a livelier and much more successful exchange of views. Peter Greenwood is determined to keep that tradition very much alive.
‘Although corporate governance can be a dry and dusty subject, we don’t let that deter us from spending an enjoyable and fast-moving day. The necessary seriousness and discipline of our discussions is usually tempered by a fair degree of good humour and occasional anarchy,’ he says.
The liveliness of the debate also depends on the extent of the direct interaction between attendees, speakers and panellists. The Institute’s CGCs have therefore adopted a format of relatively short speaker presentations followed by extended panel discussions and Q&A sessions. Another very successful innovation which will continue this year is the use of an electronic voting system enabling every member of the audience to express his or her view on the topics under discussion. The ‘topics’ to be put to a vote in this way usually include some ‘curve balls’ thrown in to liven up the proceedings. ‘We use this feature in a largely spontaneous fashion and find it often takes our discussions in quite unexpected directions,’ says Greenwood.
Join the debate
The Institute’s latest corporate governance conference comes at a particularly interesting time for corporate governance professionals – how is the regulatory environment changing and how will these changes affect your job and your profession? The forum represents a rare and valuable opportunity for attendees to participate in this frontier debate. With barely a month left before the conference gets underway, book now to avoid disappointment.
The Institute’s ninth biennial corporate governance conference will be held 19-20 September in the JW Marriott Hotel, Hong Kong. More information and the conference booking form can be found via the CGC link on the HKICS website: www.hkics.org.hk.