Mainland update
Part of the remit of this journal is to keep us up to date with governance and compliance developments in the Chinese mainland. In addition to regular updates throughout the year, our journal also annually dedicates a special edition to this essential task and this month’s CGj is just such an edition.
Our two cover stories share the insights and guidance of senior governance professionals with expertise in this area. The first looks at ways to align market value management strategies with the broader perspective of investors in their assessment of enterprise value. In determining market value, for example, there has been a growing recognition of the importance of factors such as sustainability, intangible assets, innovation and social impact – some of which may not be captured by traditional financial metrics.
Our second cover story this month offers practical advice for mainland companies pursuing a listing in Hong Kong. Given the recent surge in the number of such companies applying for listings here, this advice is very timely. Governance professionals, in particular board and company secretaries, continue to play a critical role in helping companies get up to speed with the challenges involved in preparing for an IPO in Hong Kong, and the article makes it clear that an understanding of the differences between the regulatory regimes in Hong Kong and the Chinese mainland is only the first step. The discussion of the less-well understood ‘process’ issues – such as what regulators are looking for when assessing companies seeking a Hong Kong listing – will therefore be particularly useful.
A key focus for anyone trying to get to grips with Hong Kong’s current regulatory regime should be the recent amendments to the Corporate Governance Code (Code) and related Listing Rules. In this regard, I would also like to highlight this month’s two In Focus articles. Board effectiveness is at the core of the latest round of Code and Listing Rule changes and the first article promotes the adoption of frameworks designed to improve the functioning of boards as cohesive decision-making bodies.
Another key characteristic of the Code and Listing Rules is the focus on integrity and culture. Our second In Focus article this month reviews an Institute seminar on 20 March 2025, titled Corporate Culture: Practical Sharing and Challenges, and sheds light on why integrity and culture are increasingly recognised as cornerstones of good governance.
I leave you then to our special mainland update edition. The issues addressed in the following pages will be high on the agenda for our members, affiliates and stakeholders working in the Chinese mainland, and/ or working for mainland companies, but they also have relevance for those working for a wide range of organisations here in Hong Kong and regionally. Many of the challenges faced by governance professionals today are inherently global in nature. Issues such as climate change and technological transformation do not respect national borders. As the landscape of governance continues to evolve, a more expansive perspective that takes in insights from other regulatory frameworks and best practices will empower governance professionals to better address the complex challenges of our interconnected world.
