How do you approach managing legal aspects during periods of instability or crises, and how does your legal strategy align with the broader business strategy to ensure the organisation’s resilience?

The capital market climate in Hong Kong presents a significant challenge as China struggles to bolster its economy and restore foreign investor confidence. According to Refinitiv data released in December 2023, HKEX fell to eighth place last year on the ranking for top initial public offering (IPO) venues globally which marked our lowest point since 2001. In order to be the financial superconnector with China and a trusted capital raising venue of choice for global companies, HKEX and Legal Service Department must remain innovative and focus on initiatives and policies that must correspond with the market’s needs, nuances and cycles.

Taking achieving Environmental, Social, and Governance (ESG) excellence as an example, earlier this year HKEX introduced a new paperless regime earlier this year, abolishing paper filing requirements and mandating paperless shareholder communications. To achieve HKEX’s mandate around ESG and CSR principles, there are also implications for the vendors or firms that serve and wish to serve HKEX. In our supply chain management process, Legal Service Department has played an important role in reviewing contracts, engagement letters, and master service agreement that allow HKEX to ask our service providers to disclose their ESG metrics like climate disclosure and diversity policies.

In our daily activities, Legal Service Department has also strived to achieve organisational and operational resilience through ongoing review and advises on macro trend and geopolitical risks. In addition, HKEX and Legal Service Department constantly assess how new technologies, such as generative Artificial Intelligence (AI) and Copilot can be better leveraged on for both HKEX and our service providers to achieve better operational efficiency and effectiveness, which in return provides additional value to the ecosystem during periods of instability and crises.

What strategic priorities are guiding you and your team in 2024?

HKEX is home to Asia’s most dynamic and vibrant capital markets. Each day we connect capital, ideas, inspiration and innovation to create deeper, more diverse and liquid global capital markets and provide greater choice and opportunity for our customers. As one of the world’s largest and most respected exchange groups, HKEX also serves as a financial superconnector with China and a trusted capital raising venue of choice for global companies with a deep and diverse ecosystem. HKEX’s as well as Legal Service Department’s vision is to build the Marketplace of the Future by three strategic imperatives.

Firstly, connecting China and the world: Building on HKEX’s unique China Strength, Legal Service Department focuses on initiatives that bring the China growth story to international investors and help Chinese capital access global opportunities. This involves expanding and enhancing our Connect programmes (i.e. ETF connect 2.0), becoming China’s go-to offshore risk management centre, solidifying our roles as China’s preferred offshore fundraising centre, and growing our portfolio of China-related product offerings.

Secondly, connecting Capital with Opportunities: Legal Service Department focuses on initiatives that enhance the attractiveness, depth, vibrancy and diversity of our markets, and strengthen our position as a preferred capital raising, risk management and trading venue of choice by improving our primary market attractiveness, enhancing our market structure (i.e. Severe Weather Trading Arrangement), expanding our product ecosystem, and growing our client ecosystem.

Lastly, by connecting today with tomorrow, Legal Service Department focuses on initiatives that develop a platform business that leverages modern, agile and digitised infrastructure, and will allow us to connect today with tomorrow by modernising our infrastructure, evolving from an infrastructure-led model to a client led-model, developing digital capabilities, and leveraging our data.