Jurisdiction - Hong Kong
News
Hong Kong – Consultation Conclusions On Risk Management And Internal Controls.

16 March, 2015

 


The HKEx published a consultation paper in June 2014 to seek comments on its proposed amendments to the Corporate Governance Code and Corporate Governance Report (the code) relating to internal controls. The HKEx received 57 submissions that were mostly in favor of the proposals. The main changes include:

  • incorporating risk management into the Corporate Governance Report. This includes that an assurance be given by the management to the board on the effectiveness of risk management systems;
  • defining the roles and responsibilities of the board and management (with the term “management” to be determined by companies themselves);
  • clarifying that the board has an ongoing responsibility to oversee a company’s risk management and internal control systems;
  • upgrading certain risk management disclosures to mandatory status, including the annual review of the effectiveness of the company’s risk management and internal control systems, and disclosures in the Corporate Governance Report; and
  • upgrading to a mandatory provision the requirement that companies should have an internal audit function, and those without such function to review the need for one on an annual basis.

The amendments will take effect to accounting periods beginning on or after 1 January 2016.

Skadden

For further information, please contact:

 

Christopher Betts, Partner, Skadden
christopher.betts@skadden.com


Edward Lam, Partner, Skadden
edward.lam@skadden.com


Alec Tracy, Partner, Skadden
alec.tracy@skadden.com


Will Cai, Partner, Skadden
will.cai@skadden.com

 

Comments are closed.