HSBC is committed to high standards of corporate governance. HSBC Holdings has complied throughout the six months to 31 December 2010 with the applicable code provisions of the Combined Code on Corporate Governance issued by the Financial Reporting Council and the Code on Corporate Governance Practices in Appendix 14 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.
The Board of HSBC Holdings has adopted a code of conduct for transactions in HSBC Group securities by Directors that complies with The Model Code in the Listing Rules of the Financial Services Authority and with The Model Code for Securities Transactions by Directors of Listed Issuers ('Hong Kong Model Code') set out in the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, save that The Stock Exchange of Hong Kong has granted certain waivers from strict compliance with the Hong Kong Model Code, primarily to take into account accepted practices in the UK, particularly in respect of employee share plans. Following a specific enquiry, each Director has confirmed he or she has complied with the code of conduct for transactions in HSBC Group securities throughout the period.
Board committees
The Board has appointed a number of committees consisting of certain Directors, Group Managing Directors and, in the case of the Corporate Sustainability Committee, certain co-opted non-director members.
Internal control
The Directors are responsible for internal control in HSBC and for reviewing its effectiveness. Procedures have been designed for safeguarding assets against unauthorised use or disposition; for maintaining proper accounting records; and for the reliability of financial information used within the business or for publication.
Communication with shareholders
Communication with shareholders is given high priority. Extensive information about HSBC's activities is provided in the Annual Report and Accounts, Annual Review, and the Interim Report which are sent to shareholders and are available on www.hsbc.com. There is regular dialogue with institutional investors and enquiries from individuals on matters relating to their shareholdings and the business of HSBC are welcomed and are dealt with in an informative and timely manner. All shareholders are encouraged to attend the Annual General Meeting or the informal meeting of shareholders held in Hong Kong to discuss the progress of HSBC.
Differences in HSBC Holdings/New York Stock Exchange corporate governance practices
Under the New York Stock Exchange's ('NYSE') corporate governance rules for listed companies, as a NYSE-listed foreign private issuer, HSBC Holdings must disclose any significant ways in which its corporate governance practices differ from those followed by US companies subject to NYSE listing standards. HSBC Holdings believes the following to be the significant differences between its corporate governance practices and NYSE corporate governance rules applicable to US companies.
Reputational and operational risks
HSBC reviews constantly its policies and procedures for safeguarding its operations and reputation. This is an evolutionary process which combines the adoption of international high standards and leading best practice from a variety of codes and principles, with regular internal improvement in values and business principles, oversight and controls.
Health & safety
The maintenance of appropriate health and safety standards throughout HSBC remains a key responsibility of all managers and HSBC is committed to managing actively all health and safety risks associated with its business. HSBC's objectives are to identify, remove, reduce or control material risks of fires and of accidents or injuries to employees and visitors.
Obligations of Senior Financial Officers
Pursuant to requirements of the Sarbanes-Oxley Act, HSBC Holdings has adopted a Code of Ethics applicable to the Group Chairman and Group Chief Executive, as the principal executive officers, the Group Finance Director and Group Chief Accounting Officer.
The USA Patriot Act
The USA PATRIOT Act requires a U.S. bank or a U.S. broker-dealer in securities (a "Covered Financial Institution") to obtain certain information from any "Foreign Bank" that maintains a correspondent account with it. In order to comply with these requirements individual members of the HSBC Group have prepared Certification for use by any financial institution that believes it requires Patriot Act Certification from an HSBC Group company.
To access a HSBC Group entity's Patriot Act certification please follow this link.
Related links
Accounting and Auditing Complaints
Should you wish to make a complaint regarding accounting, internal accounting controls or auditing matters, please contact us at accountingdisclosures
@hsbc.com.
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