Cheng denies need for council shake-up in wake of Chen case
The stock exchange's ruling council does not need to be restructured following the bribery trial of former exchange vice-chairman and council member Chen Po-sum, exchange chairman Edgar Cheng Wai-kin says.
On May 19, Ms Chen was acquitted of eight charges relating to the sale of exchange seats, for which she received two commissions totalling $1.6 million.
Despite the acquittal, there are concerns that she breached the declaration of interest guidelines that govern members of the council, by not informing members of the commissions.
Mr Cheng said the exchange would consider whether Ms Chen breached guidelines at a meeting next Wednesday. It would also consider whether the guidelines needed to be improved.
Exchange sources indicated that the council would set up a committee to study the issue. It is understood Ms Chen will not attend the meeting.
Mr Cheng said the declaration of interests guidelines set up in 1992 worked well but there might be room for improvement.
'The guidelines may need to be improved in some areas, such as the clarification of what kinds of benefits the council members need to disclose,' he said.
Mr Cheng insisted the council had run extremely smoothly in recent years and said it should not be changed just because one member might have breached its guidelines.
He said the council was an essential element of the exchange's self-regulatory system.
'I do believe the exchange needs to re-examine its structure in line with trends in other global markets, but the reason for any future changes is not the failure of the self-regulatory system,' he said.
Self regulation meant brokers would have to be included in the ruling council.
'Brokers like to regulate themselves effectively in order to maintain the confidence of investors,' he said.
