Ending a seven-year legal battle, the Hong Kong Exchanges and Clearing listing committee yesterday finally publicly censured New World Development for selectively giving a profit warning to analysts in 2001.
Richard Williams, HKEx head of listing, conceded the lengthy legal tussle had reduced the regulatory impact of the penalty. A public reprimand is the maximum penalty the HKEx can apply.
'Selective disclosure damages the integrity of the market. This unfair practice is more corrosive when it is conducted methodically without any apparent attempt to properly inform all shareholders and the wider investing public,' Mr Williams said.
New World Development yesterday said it respected the decision of the listing committee, adding that it has been improving its corporate governance systems to ensure it made no more selective disclosures.
'The employee concerned left the company soon after the incident. Since then, the company has been continuously enhancing internal control systems and introducing measures to strengthen corporate governance,' New World said in a statement.
'These include the setting up of a corporate affairs department to centralise the release of information and to adopt a blackout period for analysts and investors one month before the results announcement.'
The company has also appointed an independent professional company to conduct a review of the procedures in releasing information, especially price-sensitive ones, 'with a view to further fine-tune the system'.
