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Case Study

Hong Kong Stock Exchange: The mainland challenge

By Michael R. Wade, Fei Li and Yulin Fang

11 pages

January 2012

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Reference: IMD-3-2288

The case is written from the perspective of Charles Li, the chief executive designate of the Hong Kong Stock Exchange (HKEx). Li is faced with a number of challenges relating to the strategic direction of the HKEx. In particular, he needs to develop a plan to address the growing power of mainland exchanges, most notably the Shanghai Stock Exchange (SSE). The cases presents a number of options available to Li, including whether or not to accept mainland accounting standards for companies listed on the HKEx. This is a polarizing issue within the Hong Kong financial community. On the one hand, the change would make listing on the HKEx much more attractive for mainland firms; on the other hand, it could challenge the reputation and integrity of the HKEx in the minds of Hong Kong and foreign members and investors.

Learning Objective

Learn about the financial and political and regulatory environments in China. Address the tension between strategic growth and corporate reputation.

Keywords

Regulation, Strategic Growth, Corporate Reputation, Financial Services

Settings

2010-2012

Type

Published Sources

Available Languages

English

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