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LCQ10: Appointment of the Chief Executive of the Hong Kong Monetary Authority

     Following is the question by the Hon Emily Lau and a written reply by the Financial Secretary, Mr John C Tsang, in the Legislative Council today (November 18):


     The Financial Secretary (FS) announced the appointment of Mr Norman Chan as the Chief Executive (CE) of the Hong Kong Monetary Authority (HKMA) in mid-July this year.  FS stated that he had invited three persons in August 2008 to recommend to him suitable candidates for the post.  FS had also invited a retired human resource specialist to assist them in their work.  The group completed their work towards the end of 2008.  They had altogether considered 39 persons, including persons from HKMA, regulatory agencies, banks and the academia as well as government officials.  The group shortlisted eight people for recommendation to FS in order of priority, among whom Mr Norman Chan was the first choice.  The Government ultimately appointed Mr Chan as the CE of HKMA.  In this connection, will the Government inform this Council:

(a) of the number of meetings convened by the aforesaid selection group between August and December 2008; whether meetings were convened to discuss the 39-person list; whether interviews were conducted with those on the eight-person list; and how the decision to recommend Mr Norman Chan was made;

(b) given that the remuneration for Mr Chan is lower than that for the former CE and there was no prescribed term of office for the former CE, whereas the term for Mr Chan is five years, of the criteria adopted by the authorities for determining his remuneration, conditions of service and the five-year term; and

(c)  given that Mr Chan was appointed Director of the Chief Executive Office of the Hong Kong Government in July 2007, and FS reached consensus with the former CE one month later on the decision that his term would end at the end of September 2009, whether Mr Chan was aware of this arrangement?


     Section 5A(1) of the Exchange Fund Ordinance provides the Financial Secretary (FS) with the flexibility in deciding the person to be appointed as the Monetary Authority and the related terms of appointment.  When announcing the appointment of Mr Norman Chan as the Monetary Authority at the press conference held on July 17, 2009, FS gave a full account of the appointment procedures, selection criteria, term of office and remuneration arrangements.

(a)  In August 2008, FS invited Dr Victor Fung, Dr Marvin Cheung and Sir John Bond to advise him on candidates for the new Monetary Authority.  FS also invited Mr Martin Tang, a retired human resources specialist, to assist in the work.

     From August 2008 to the end of the year, the group held three meetings and considered 39 candidates.  An eight-person shortlist in order of priority, with Mr Norman Chan being the first priority, was recommended to FS.  The tasks undertaken by the group were then considered accomplished.

     FS accepted the recommendation of the group.  As the candidates considered by the group are leaders of the financial sector and persons holding important positions in the community, FS is familiar with their professional achievements and personal qualities.  Since Mr Chan was the first choice and he accepted the appointment, there was no need to contact anyone else.

(b)  FS also asked the Governance Sub-Committee (GSC) to advise him on the remuneration and conditions of service of the new Monetary Authority.  The GSC submitted its views to FS having regard to the remuneration and conditions of service of the Chief Executive and Deputy Chief Executive of the Hong Kong Monetary Authority at that time.  FS had considered the views of the GSC before deciding on the remuneration and conditions of service of the incumbent Monetary Authority.

     As regards the term of office, FS made reference to practises in other countries and considered the views of the GSC and other factors.  He considered it appropriate to fix the term of office of the Monetary Authority at five years.

(c)  Appointing the Monetary Authority is the job of the FS.  Mr Norman Chan had no knowledge of the entire process.

Ends/Wednesday, November 18, 2009
Issued at HKT 12:25


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