Tuesday, May 20, 2014

For FuCC's Sake

It's that time of year again - elections at the FCC, the time when an elite portion of the minority of the club's members cling onto power, just rotating the top position.

My mole at the FCC tells me that the board has got themselves into a right buggers' muddle, having failed to notice the single most important reform of company law in living memory in Hong Kong. Perhaps they haven't been reading the papers for the last two years. Or perhaps they are all telejournalists.

Anyway, when sending out the notices for the AGM (and for an EGM for a motion to restrict the tenure of board members), they omitted to say that proxy votes could be cast. This is a requirement - one of the changes under the new Companies Ordinance, the single most important reform of company law in living memory in Hong Kong. (Did I mention that?)

Although this makes the notice non-compliant, apparently the AGM and EGM themselves would not be invalidated by the omission. Nevertheless, it appears that the board has panicked somewhat and deferred the AGM to a date outside the permitted date range (so still not compliant) and cancelled the EGM. No self-interest operating there, then.

As a result, a correspondence has built up amongst disgruntled members, most of whom, as people who merely read the papers, are barred from full board membership. There is talk of holding the board to account. Shock! Horror! My mole has been kind (or indiscrete) enough to forward the e-mail chain to me.

Fortunately, cooler heads are starting to prevail. One David O'Lear, a former governor of the board and a current nominee for second vice president, says in the chain:

The new Companies Ordinance requires that we have proxy voting at AGMs and EGMs. We did not provide for that, partly because of change of secretaries but also because advice received did not identify proxies as an important issue.
So Mr. O'Rear has pointed his finger, firstly, at two company secretaries without saying which one (outgoing or incoming) was to blame (or explaining how a mere change in secretary could cause a problem) and, secondly, at the FCC's advisors (omitting to state whether advice was sought on the specific issue, on the wider question of the application of the new Ordinance (the single most important reform of company law in living memory in Hong Kong - did I mention that?), or indeed whether any advice was sought at all on anything. His careful wording would be consistent with no advice having been either received or sought. Not exactly a straw man, but something like it.

But then he goes on to say:

I support X's attitude, .... don't point fingers and let the Board work it out.
Yes, don't point fingers. That's the way to go, Mr. O' Rear.


  1. I think I may be able to claim a little credit for this since I wrote the the (new) secretary (who is a sub-editor at the sub-Standard, with, as far as I know, no experience of anything similar previously) immediately on receiving notice of the EGM asking about the mechanism for proxy voting. Although to be fair to him he seems to have followed up assiduously once he was aware of the issue.

    I guess that the "legal advice" that they sought was from one Mr Egan. No surprise then that the result is that they quietly forget the EGM that is the latest of many attempts to get the convicted crim (*) off our board!

    The way this is all done is really quite outrageous - as journalists reporting on some banana republic somewhere they would be condemning it in forthright tones. But when it's close to home it's all somehow OK.

    If a copy of that email chain happened to find its way to paul852 hkbn.net I would be very interested to see it.

    (*) Conviction overturned on appeal on a technicality.

  2. And so the results are pretty much what you'd expect:

    It does amaze me that the crim gets far more votes than anyone else! I note that his manifesto justifies his position thus:
    "Why vote for me? The answer is simple - "steady hand on the tiller!" I am a practising lawyer (and the only one running for election this year) and the Club frankly needs someone like me to ensure that the Club runs smoothly and stays within the rules.

    Many of you may not know this but as well as being a fine club the FCC is also a duly incorporated company. When you elect the Board of Governors each year you are in fact (and in law) electing a Board of Directors to run this company. That is why you need to choose your candidates carefully since company directors have statutory duties to perform and owe fiduciary duties to you, the members."

    I wonder if the result would have been the same if held now, after the board, with the crim as their only lawyer FuCCed up so spectacularly over the whole AGM shambles?

    If Egan were an honourable man he would surely do the decent thing and resign immediately over this fiasco having stood on that platform. But then, as we all know, that is hardly a description anyone else is every likely to apply to him...

  3. The FCC clearly needs a big hug.