Jardine Fleming has been forced to grow up. This may be a matter of regret to those who enjoyed themselves, and grew rich, during its less buttoned-down past. But, once the way the firm was run had hit the headlines last month, a restructuring on the lines of that announced yesterday became inevitable.
The extent of the changes was the main surprise. Above and beyond the personalities involved, the firm is clearly admitting that radical alterations were needed in the whole way it looks at controlling its business. This involves a major internal power shift, with Robert Fleming and Jardine Matheson exerting a much greater grip on their subsidiary.
There will be those who see this as a victory of corporate bureaucracy over the more free-wheeling style of the past; to which the response must be that the free-wheelers brought it on themselves by the way they acted. The task for the new committee running Jardine Fleming will be to retain the essence of what made it so successful in the past while ensuring that world-standard controls are in place, are effective, and are clearly seen to be so by the investing public.
Given the position of Jardine Fleming among Hong Kong funds, and the amount of money invested in it by institutions and ordinary people here, the restructuring has to be good news for the territory.
It may be that investors do not care too much about the inner workings of a fund company so long as they go on making capital gains. But the reputation of Hong Kong as a place where money is handled soundly and honestly is of prime importance to the territory's position and future as a major international financial services centre.
If only for that reason, the changes announced yesterday are more than welcome. They are a good sign that the firm's owners recognise the extent of the dangers which had grown up over the years, both for themselves and for Hong Kong's standing.
