Hong Kong stock exchange operator HKEX picks former securities watchdog head Carlson Tong as chairman
- Tong will work with CEO Bonnie Chan as the exchange grapples with low market turnover and a decline in new listings
- Tong is considered by a former colleague as an ‘open-minded, highly diligent chairman who is able to bring the board to focus on the big picture’
Hong Kong Exchanges and Clearing (HKEX), which operates Asia’s third-largest stock market, has named former Securities and Futures Commission (SFC) chairman Carlson Tong Ka-shing, a veteran accountant and market regulator, as its new chairman.
Tong was elected by the board on Wednesday to succeed Laura Cha Shih May-lung, who retires after a six-year term.
“I am committed to spearheading our collective efforts to continuously reinforce Hong Kong’s strategic role as a global financial hub,” Tong said in a statement after taking on the new role. “We recognise that we operate in a dynamic and evolving environment, presenting both challenges and opportunities.
“While certain external factors like geopolitics and interest rates remain beyond our direct control, we must be proactive in preparing ourselves to seize opportunities when the external environment improves.
“Simultaneously, we shall focus on diversifying our product ranges, enhancing our trading mechanisms and bolstering our competitiveness. By navigating the immediate challenges and positioning ourselves for long-term opportunities, we will fulfill HKEX’s obligations to the investing public while delivering value to its shareholders.”
Tong will receive a HK$4.55 million (US$583,333) director’s fee annually, according to a stock exchange filing. His term runs until the end of his directorship at HKEX’s annual general meeting in 2025, when he could be reappointed.
In her final media briefing with HKEX, which followed the bourse operator’s annual general meeting, Cha said the turnover and initial public offering applications have improved in recent months.
“I am positive on the outlook of HKEX, which will benefit from the improved economy,” she said. “The exchange will continue its internationalisation process to strengthen its connector role between the mainland [Chinese] capital markets and the world.”
Cha said she is proud of her involvement in opening overseas offices for HKEX in London and New York during her tenure, adding that she retires from the frontline role after working in the capital markets for more than 30 years.
The board appointed Cha as a senior adviser for one year.
Tong will work closely with recently appointed CEO Bonnie Chan Yiting to lead HKEX at a time when it is grappling with challenges like poor liquidity and falling new listings.
Hong Kong’s bourse fell to 10th place globally for new listings in the first quarter, with just 12 deals raising US$604.4 million, a 29 per cent year-on-year decline, according to data from the London Stock Exchange Group. It was the world’s top-ranked venue for seven times between 2009 and 2019.
Tong, 69, was the SFC’s chairman from 2012 to 2018. Before that, he was the chairman of KPMG China from 2007 to 2011 and also headed HKEX’s listing committee from 2006 to 2008.
During Tong’s tenure, the SFC tightened oversight of the market, handing out nearly HK$4 billion in fines and compensations in several high-profile cases of insider dealing, false disclosure, failure of internal controls, mis-selling and other wrongdoing.
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“[Tong’s] immense knowledge of and experience in the operation of the financial market and regulation of securities-related activities will contribute to HKEX in further enhancing its competitiveness and expanding its business,” Chan said when he appointed Tong to the HKEX board in February 2023.
HKEX has 13 directors, including CEO Bonnie Chan, six appointed by the government and the rest by shareholders.
Frederick Ma Si-hang, chairman of Hong Kong insurer FWD Group Holdings, said Tong was a good choice. Ma worked with Tong when he was listing committee chairman and Ma was secretary for financial services and the treasury.
“Carlson is the ideal person to serve as chairman of the HKEX because he has deep and valuable strategic insights across the capital markets,” Ma said. “His remarkable track record and exceptional leadership and excellent communication skills with all stakeholders will lead the HKEX to expand further in the coming years.”
Kelvin Wong Tin-yau, chairman of the Accounting and Financial Reporting Council, who was an independent director of the SFC from 2012 to 2018 when Tong was chairman of the market regulator, also chimed in with his approval.
“Carlson is a well respected chairman to work with as he always prepared well for the agenda and actively engaged with members to ensure different views are understood and discussed,” Wong said.
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“He is an open-minded, highly diligent chairman who is able to bring the board to focus on the big picture. He has showed his charismatic ability to build consensus among members with diverse views.”
Local brokerages said Tong’s leadership is much needed at a difficult time.
“It is great to have [Tong] who has a great experience in the local capital market to chair HKEX,” said Robert Lee Wai-wang, a lawmaker representing the local financial services sector.
“We would like to see the new chairman carry out more reforms to enhance the market turnover and to expand the global status of the exchange in coming years.”
