David Webb, an investor activist, has strongly criticised the corporate governance practices of exchange operator Hong Kong Exchanges and Clearing (HKEx) following his resignation as a non-executive director of the firm’s board on 15 May. He was on the firm’s board for five years.
In his resignation letter, published by HKEx, Webb listed six reasons for his departure from the board, in which he attacks the exchange operator’s governance and transparency. Among his allegations are that the firm’s management refused to provide certain information he had requested under the Code of Corporate Governance to facilitate his duties as a director. Webb further alleged that certain meetings were held between HKEx and third parties on the condition that the board was not informed of the content of the meetings unless the third parties consented. He also accused the firm of making U-turns led by government-appointed directors on political grounds.
“It is clear to me as a director that, while on the face of it, HKEx has won corporate governance awards, policy is increasingly being driven through the back door by inexperienced and inexpert officials rather than by an independent board in the best interests of the market,” he wrote in the letter.
Although it published the letter, HKEx’s board said it does not agree with the criticisms directed at the government-appointed directors other board members and management of the company. It said it revealed the contents of the letter in the interests of transparency.
Webb is a former investment banker who now divides his time between non-profit governance advocacy and researching the Hong Kong market, particularly smaller companies.