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Following is the speech made by the Chief Executive, Mr Tung Chee Hwa, at the opening ceremony of the Leadership Forum 2002 at the Hong Kong Convention and Exhibition Centre this (December 12) morning :
Honourable colleagues, distinguished guests, ladies and gentlemen,
It is a great pleasure to join you today for a forum that deals with a topic of utmost importance to any world city - ethical leadership.
Two years ago, the Civil Service Bureau and the ICAC jointly organised their first 'Ethical Leadership Forum'. The Forum was very well received, and reinforced the commitment of business and government leaders in Hong Kong to adhere to the highest standards of personal and professional integrity.
Today's forum is a sequel to that event. It is yet another example to the local and international communities that business and public sector leaders share a common commitment : that is, to uphold Hong Kong's reputation as a world city with a level playing field for business and a clean administration.
In a report issued last year, the Economist Intelligence Unit noted that corruption was not perceived to be a problem in Hong Kong. The Corruption Perceptions Index, released by the Transparency International in August 2002, ranked Hong Kong in the top 15 least corrupt countries or economies in the world. At 14th place, we ranked just behind Switzerland, Norway, Australia and the UK. But we ranked ahead of countries such as Austria, the US, Germany, Japan, France and Ireland. Such a ranking reflects years of constant effort by the ICAC, the Government and the public to keep Hong Kong clean. In another survey by the same organisation, Hong Kong was also ranked at the bottom of economies whose governments are likely to be associated with practices to gain unfair advantage in international trade and investment.
Despite these achievements, and the world-class reputation of our ICAC, there is no room for complacency. At the moment, we are facing tremendous challenges as our economy grapples with restructuring.
It is at times like these, when margins are thin or turnover lackluster, that the temptation to take short-cuts or seek illicit advantage rears its ugly head. It is therefore all the more important to be as vigilant as ever against the threat of corruption. The best way to prevent this is to foster a culture of honesty and integrity in the workplace. As leaders of the business and public sectors, we shoulder a heavy responsibility to ensure that Hong Kong remains a beacon of clean administration in the region, and indeed around the world.
We are fortunate that we have a strong institutional framework to buttress our efforts, and provide us with a healthy business environment. These are well known to you all : a tried and trusted legal system upheld by an independent judiciary, the free flow of information, a robust and critical media that operates in an unfettered environment, a highly-trained and professional police force and a top-notch anti-corruption agency that has been used as a model by governments around the world.
Since the Asian financial crisis in 1997, good corporate governance has also been a major focus of discussions, and has never been more important. Recent corporate scandals in the United States understandably shocked the investing public, as well as exposing weaknesses in the auditing and regulatory regimes. Here in Hong Kong we have been working hard over the past few years to bolster the efficacy of our corporate governance regimes.
In fact, corporate governance was identified as a priority area in Hong Kong well before Enron. Good corporate governance is essential if we are to maintain our position as a leading and quality international financial centre. Over the past few years, we have been working hard to bring our corporate governance standards up to global standards. Our Standing Committee on Company Law Reform has already issued its Phase I recommendations on corporate governance, which I am pleased to say match considerably with the work being undertaken by the UK Company Law Review Steering Group.
The Hong Kong Exchanges and Clearing Ltd and the Securities and Futures Commission have been busy modernising the Listing Rules and consulting the market on Corporate Governance proposals for amending Listing Rules. There will be improved disclosure requirements, increased protection of shareholders' rights, better directors and board practices, and strengthened enforcement of the law against false and misleading disclosure of corporate information.
And in March this year our legislature passed the Securities and Futures Ordinance that put our regulatory regime on a par with the best international standards. The Ordinance includes a number of key initiatives to enhance the market quality, including new disciplinary sanctions to combat market misconduct; new measures to protect the interests of investors by criminalising market misconduct and providing a civil route for action; and a tighter regime for disclosure of listed companies.
We are also fortunate to have both good accounting and good auditing standards, and one of the reasons is because we have one of the highest concentrations of accountants here in Hong Kong.
Yes, we have done a great deal, a great deal to protect the rights of our citizens and investors for a clean, corruption-free business environment. But we cannot be complacent. Experience elsewhere has shown that the best rules and regulations may fail us. The best enforcement may also fail us. Therefore I look to you all , as the leaders of our society, to continue to provide not only the anchor, but also the driving force for instilling and upholding an ethical culture in our workplace.
I hope that, as leaders of the public and private sectors, you will play a prominent role in communicating our shared commitment to a 'zero tolerance' of corruption here in Hong Kong. And also, provide those working for you with a personal example of ethical and professional behaviour by always acting with honesty and integrity.
We should also remember that our young people will look to us for guidance, direction and example. The way we behave at work will invariably have an impact on how they themselves approach their lives and careers. Shakespeare once wrote : "No legacy is so rich as honesty." It is sensible advice that still carries tremendous weight today.
If we all work together, we can maintain our proud record as one of the least corrupt societies in the world. I know this will be the case.
Finally, I wish the forum great success. I am confident that, when the day is over, you will have a deeper understanding of the ethical challenges we face as well as a renewed vigour to face those challenges.
Thank you very much.
End/Thursday, December 12, 2002
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