Lai See

Unintended consequences of Charles Li's blog

PUBLISHED : Thursday, 10 April, 2014, 12:57am
UPDATED : Thursday, 10 April, 2014, 12:57am

The law of unintended consequences is a curious thing as HKEx chief executive Charles Li Xiaojia recently discovered to his cost. Li got himself into hot water with the government which, we understand, was deeply upset by one aspect of his recent blog. As a result, he has had to eat humble pie and issue a "clarification" in which he is reduced to blaming the press for "some confusion" about the purpose of the blog.

Readers will recall that we reported on Tuesday that Li had revived the issue of the Alibaba listing and the vast opportunities Hong Kong would lose if mainland technology and new economy companies were not allowed to adopt dual-class shares.

He argued that this had come about as a result of a mistaken view that one share, one vote was "a core principle of the Hong Kong market". To demonstrate this, he cited the example of HKEx. "HKEx itself is not subject to this principle, as the Hong Kong government gets to appoint six out of the 12 non-executive directors and name the chairman, regardless of how many HKEx shares it owns (currently 5.8 per cent)."

This, he says, can be justified on grounds of public interest, and "shareholders' interests are subordinate to public interest".

Li possibly didn't couch this in sufficiently reverential terms, but the government appears to have been annoyed with him for subjecting this example of shoddy corporate governance under the spotlight. As Li put it, "On further reflection, it may not have been the best of examples."

The upshot has been that the focus has shifted from the discussion of dual-class shares to his row with the government.


Not so transparent

Real estate broker Midland somewhat grudgingly held a press conference this week to discuss its lamentable results. But it was only after pressure from its second-largest shareholder Apex Benchmark, whose senior executives include a number of former Midland honchos. It would have been the first time in about 10 years that Midland would not have held a press conference to discuss its results.

Asked why the company had originally opted not to have a press conference, chairman Freddie Wong Kin-yip said there was no rule requiring a listed company to do so. "I am very shy and like to keep low-profile. In any case, we are a very transparent company, and you can see everything on our website."

One of the criticisms levelled at Wong was that Midland was leasing properties from him for its own use at, shall we say, rather full values.

Midland yesterday issued a stock exchange notice reporting lease renewals for two such connected transactions. One shop in Taikoo Shing was rented for HK$102,000 per month, a drop of 6.3 per cent from the previous rent. Another, in Tsim Sha Tsui, saw the rent increase 12 per cent to HK$162,000 per month.

The price per square foot was not given, which seems a pity given the "transparency" Wong was boasting about.


Whisky galore

Now for something that every self-proclaimed world city should have - a whisky festival. Hong Kong's first whisky festival - Malt Master HK - takes place this weekend at Crown Wine Cellars at Shouson Hill.

The event is being organised by Ian McKerrow, who comes from a family steeped in whisky, so to speak. His father Neil was chief executive of Glenmorangie and will be speaking at the preview dinner. His mother is a Mackinlay, whose family at one time made their own blended whiskies.

There is a four-course dinner tomorrow accompanied by seven whiskies not normally found in retail outlets in Hong Kong. The seven are Balbair 1983, Bowmore 23-year-old Port finish, Auchentoshan Virgin Oak, Peneryn Original - Madeira finish, Glenlossie 1992, Blue Hanger - malt blend, and The Last Drop, of which there are only 388 bottles and, according to Jim Murray's Whisky Bible, is among the world's top 20 whiskies. The dinner also includes talks from whisky experts. All this for HK$2,500.

There are two whisky tasting sessions on Saturday, from 12pm to 3pm and 3.30pm to 6.30pm, where for HK$800 there will be more than 50 malt whiskies from 18 major brands that are available for tasting. For an additional HK$200, one gets to attend a master class. For tickets and more details, go to Enjoy.


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