Many things are taken for granted in Central’s business world.
For example, most listed companies hold news conferences after announcing their interim and annual results. It’s become a well-established tradition.
Until this week, Henderson Land Development Co. Ltd. (00012.HK), one of the city’s top four property developers, had never held a post-results news conference in its 43 years of history.
On Monday, it held an annual results news conference for the first time.
Lee Shau-kee, the firm’s 88-year-old founder, discussed various topics with the media, including company earnings, Hong Kong’s housing prices, the candidates for chief executive, and so on.
It was quite an unusual move for the firm.
Most listed companies treat post-results news conferences as routine.
While Henderson used to be an exception, that has not hampered its business expansion at all in the past.
Lee has been very generous in paying dividends to shareholders. He is quite popular among minority shareholders.
In the past, the company would invite shareholders to have dim sum in a closed-door meeting.
Everyone was happy.
However, things have changed dramatically.
The shareholder base has expanded, and Henderson has also ventured into different sectors.
Shareholders are no longer satisfied with dim sum in an era when news can be sent around the world immediately.
Henderson’s public relations manager said many shareholders are concerned about falling property prices and share prices, and some even called Lee to make enquiries.
So, Lee decided to answer all their questions in public, and the company intends to hold routine news conferences in the future.
Lee, as the founder of Henderson, has the influence and power to kickstart the new tradition.
It would pave the way for him to pass the torch to his two sons in the future.
As we saw in the news conference Monday, he will pass the easier questions to his sons.
Several local tycoons are preparing to pass their business to the next generation.
It’s easy enough to make arrangements for succession when it comes to one’s wealth. All that is needed is to sign some legal documents.
It’s much more difficult to transfer one’s intangible legacy, such as political and social influence.
This can’t be passed on simply by signing documents.
So, the annual live news conference is the perfect opportunity to build a company’s brand and enhance its influence among the public.
Holding post-results news conferences generates a lot of benefits for listed companies.
The company only needs to deploy limited capital and human resources, and it could make shareholders aware of the latest company developments.
Li Ka-shing, chairman of CK Hutchison Holdings Ltd. (00001.HK), has used his twice-yearly news conference to build the company’s image.
He has done a perfect job of building its image among the public and calling for those who have different political opinions not to harm Hong Kong.
Interestingly, post-results news conference are not a universal phenomenon.
There is no such tradition in the United States or mainland China, since both markets use a quarterly reporting system.
And there are far too many listed companies in the US and the mainland for reporters to attend all their news conferences.
Institutional investors dominate the US market, and listed companies convene conference calls with analysts to communicate with investors.
In the mainland, limited press freedom is not conducive to post-results news conferences.
This article appeared in the Hong Kong Economic Journal on March 23.
Translation by Julie Zhu
[Chinese version 中文版]
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