CFA Society Hong Kong and CFA Institute support targeted reforms to strengthen Hong Kong’s listing competitiveness, while calling for proportionate safeguards to protect investors and uphold the one-share-one-vote principle.
CFA Society Hong Kong and CFA Institute welcome HKEX’s objective of strengthening Hong Kong’s competitiveness as a listing venue, provided that greater flexibility is matched by proportionate investor protections and credible governance safeguards.
Our starting point remains that one share, one vote is the stronger governance standard. Aligning voting power with economic ownership protects minority shareholders, supports management accountability, and strengthens confidence in the market. Where the listing framework departs from this principle, the additional flexibility should be carefully calibrated and accompanied by appropriate safeguards.
Key positions in our response include:
- Weighted voting rights (WVR): We recognise the case for lowering the WVR financial eligibility thresholds to address Hong Kong’s competitive position, but do not support eliminating them. We also urge caution where changes could further separate voting control from economic ownership. Greater flexibility should be accompanied by strong disclosure, independent oversight and protections for minority shareholders.
- Innovative companies: We support the introduction of separate Route A and Route B pathways for technology-driven and business model-driven companies. The distinction provides greater clarity for applicants and investors, while recognising that the two types of innovation can present different commercial and governance risks. Business model-driven applicants should demonstrate an appropriate level of commercial maturity and financial sustainability.
- Confidential filing: We support allowing listing applicants to keep their initial application documents confidential. This would protect commercially sensitive information and bring Hong Kong more closely into line with other major listing venues. However, investors should still have adequate time to assess the relevant information before pricing and make informed investment decisions.
- Professional accountability: We strongly support greater transparency regarding the professional advisers responsible for listing applications that are returned by HKEX. Extending accountability beyond sponsors and applicants can strengthen quality control across the listing process. Any disclosure should clearly explain the reason for the return and the role performed by each adviser.
The response also supports selected changes that would reduce unnecessary compliance burdens, clarify existing requirements, and make the listing process more predictable. Overall, Hong Kong’s long-term competitiveness will depend on achieving the right balance between market access and flexibility, on the one hand, and strong governance, investor protection and market integrity, on the other.