Topic 3: Professionals' Supporting Role to Company
Directors in Mastering Ethical Challenges
Mr Donald C. MEYER, Director, Synergy Asia Investments Limited represented the four English discussion groups to report back on the topic "Professionals' Supporting Role to Company Directors in Mastering Ethical Challenges". His sharings were as follows.
Role of Professionals
There were three thresholds for professionals to consider when facing ethical challenges: legal
standard, professional standard and ethical standard.
Manfold breached the Listing Rules since Fred was not truly an INED due to his close
relationship with the Chairman.
Fred should disclose rumours of On Yee to the audit committee, if not the full board, which may
turn out to be price sensitive information.
Ken crossed the line of affection and failed to perform his role properly as a professional
external auditor. He owed fiduciary duties to shareholders so he should look into potential
problems. Disproportionate audit fees compared with consultant fees were revealed. There
should be clear guidelines on hiring auditors for non-auditing jobs.
Francis prepared a favourable stock report of Manfold due to acceptance of a Thailand trip. He
should act fairly and honestly in the best interests of his clients and the integrity of the market.
Ethical Challenges Faced by Listed Companies
The recent incidents related to listed companies were a serious blow to the investors' confidence in the stock market. If that trust further broke down, we would not have a very
functioning share market. All listed companies must now take on the mantle of corporate
governance. Not only was it a right thing to do, but also because there was self interest to get
back to that level of trust that we had.
