Hong Kong Business (April - June 2022) by Charlton Media Group

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Issue No. 66

TIME FOR A COMEBACK Hong Kong’s Best Selling Business Magazine

HONG KONG’S TOP 50 INSURERS SHOW A SURGE IN ASSETS, WITH HEALTH AND WELLNESS AS A PRIORITY FOR THE INDUSTRY.

YAS MICROINSURANCE PUTS A PRICE ON NFTS COMPETING FOR THE BEST TALENT IN HONG KONG’S SHRINKING TALENT POOL PREPARE TO GO CASHLESS OR PAY THE PRICE RENT CONTROL BILL TO BURY ABUSIVE ‘COFFIN HOME’ LANDLORDS

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HONG KONG BUSINESS | Q2 2022

HONG KONG

FROM THE EDITOR

BUSINESS

Established 1982 Editorial Enquiries: Charlton Media Group Hong Kong Ltd Room 1006, 10th Floor, 299 QRC, 287-299 Queen’s Road Central, Hong Kong. +852 3972 7166

n this issue, we highlight the state of Hong Kong’s workforce, property, and retail sectors amidst the fifth wave of the pandemic. The region is seeing a shrinking talent pool that calls for new strategies to reel in potential candidates. In the residential property sector, the rent control bill aims to bury abusive ‘coffin home’ landlords. The retail industry is also given an ultimatum to go cashless or ‘pay the price’.

PUBLISHER & EDITOR-IN-CHIEF Tim Charlton ASSOCIATE PUBLISHER Louis Shek PRINT PRODUCTION EDITOR Jeline Acabo COMMERCIAL EDITOR Janine Ballesteros COPY EDITOR Tessa Distor PRODUCTION TEAM Charmaine Tadalan Djan Magbanua Lucia De Guzman Frances Gagua Vann Villegas Noreen Jazul GRAPHIC ARTIST Simon Engracial ADVERTISING CONTACTS Louis Shek +852 6099 9768 louis@hongkongbusiness.hk Karisse Coderes karisse@charltonmediamail.com

We also feature YAS MicroInsurance, one of the first insurtech firms in Hong Kong to insure NFTs. See the full story on page 16. On page 20, see the full list of the latest rankings of Hong Kong’s esteemed insurance firms. In this issue, we are proud to honour Hong Kong’s exceptional enterprises at the High Flyers Awards 2021 (page 22), the top teams, executives, and innovations at the Management Excellence Awards 2021 (page 24), the outstanding organisations in the HKB Greater Bay Area Enterprise Awards (page 30), the top companies in Made in Hong Kong and Designed in Hong Kong Awards 2021 (page 36), and the winners of the 4th Asian Export Awards (page 42). Congratulations to all! Read on and enjoy!

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Editorial Enquiries: If you have a story idea or press release, please email our news editor at editorial@hongkongbusiness.hk. To send a personal message to the editor, include the word “Tim” in the subject line. Media Partnerships: Please email editorial@hongkongbusiness.hk with “Partnership” in the subject line. Subscriptions email: subscriptions@charltonmedia.com Hong Kong Business is published by Charlton Media Group. All editorial is copyright and may not be reproduced without consent. Contributions are invited but copies of all work should be kept as Hong Kong Business can accept no responsibility for loss. We will however take the gains. Sold on newstands in Hong Kong, Macau, Singapore, London, and New York. *If you’re reading the small print you may be missing the big picture    

HONG KONG BUSINESS | Q2 2022

CONTENTS

INSURTECH YAS MICROINSURANCE PUTS A PRICE ON NFTS

FIRST 06 Here’s how you build a successful BNPL: study

07 HK CEOs’ confidence in economic growth wanes

08 HKPC develops service robots to address manpower shortage

BRIEFINGS 10 Competing for the best talent in

Hong Kong’s shrinking talent pool

12 Rent control bill aims to bury

abusive ‘coffin home’ landlords

14 Prepare to go cashless or pay the price

RANKINGS TIME FOR A COMEBACK? HONG KONG’S TOP 50 INSURERS SHOW A 9.75% SURGE IN ASSETS

HR BRIEFING SINK OR SWIM: COMPETING FOR THE BEST TALENT IN HONG KONG’S SHRINKING TALENT POOL

OPINION

RANKINGS 20 Time for a comeback? Hong Kong’s top 50 insurers show a 9.75% surge in assets

EVENT COVERAGE

46 Cryptocurrency in Hong Kong – why regulation and enforcement are needed

48 The top architectural trends to watch out for in Asia in 2022

22 Hong Kong Business lauds

exceptional enterprises at the High Flyers Awards 2021

24 HKB lauds top teams, executives, and innovations at Management Excellence Awards 2021

30 Outstanding organisations lauded

in the HKB Greater Bay Area Enterprise Awards

36 HKB lauds top companies in Made in Hong Kong and Designed in Hong Kong Awards 2021

Published Bi-monthly on the Second week of the Month by Charlton Media Group Pte Ltd, 19th Floor, Yat Chau Building 2 HONG KONG BUSINESS | JANUARY Q2 2022 2019 262 Des Voeux Road Central

For the latest business news from Hong Kong visit the website

www.hongkongbusiness.hk

HONG KONG BUSINESS | Q2 2022

News from hongkongbusiness.hk Daily news from Hong Kong MOST READ

OVERFLOW: 40 WORDS RETAIL

ENERGY & OFFSHORE

Here’s why 2022 is going to be a ‘slightly’ worse year for retail in HK

Hongkong Land offers $15m for unprivileged people, rent relief

Where is Hong Kong now in its carbon neutrality target?

This year will be “slightly worse” for the retail industry as the economy remains to be clouded with uncertainties, experts from PwC said. The firm said the retail industry will be affected by wealth impact on consumption, employee’s disposal income and reopening of borders.

Hongkong Land donated $15m into Hongkong Land Home Fund to support underprivileged communities and offered rent relief measures for retail tenants amidst the fifth wave of COVID-19. Hongkong Land said that $5m was allocated to support 30 NGOs to distribute food and essentials.

Hong Kong has been introduced measures to stabilise its carbon emissions, tying its economic activities into its environmental goals of achieving net-zero before 2050. The government has implemented several new strategies on waste management, energy supply, and green building.

BUILDING & ENGINEERING

RESIDENTIAL PROPERTY

INFORMATION TECHNOLOGY

FOOD & BEVERAGE

Israel and Hong Kong forge fertile business bonds

HR Briefing: Will machines take over Hong Kongers’ jobs?

7 of 10 Hong Kongers think food affects mental health: Deliveroo

HK is soon to be a safer place for health workers due to closed system transfer devices that minimise their exposure to hazardous drugs when administering medication. This technology was developed by Simplivia, an Israeli company keen on entering HK market.

Around 56% say they are threatened by the rising dependence on automation by local business, and the pandemic may have magnified this fear as businesses across all sectors have automated their operations, but analysts say there will also be opportunities.

Deliveroo’s first Share of Stomach report showed 55% growth in food delivery during the pandemic. Mental and physical health are at the top of the list of concerns for Hong Kongers, leading to an increased appetite for food delivery among consumers.

HONG KONG BUSINESS | JANUARY Q2 2022 2019

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FIRST 5 KEY TRENDS THAT WILL SHAPE THE LABOUR MARKET

nternational Workplace Group (IWG), a global workspace provider, highlighted five trends arising from the hybrid work model. ”One of the lasting legacies of the pandemic is the accelerated uptake of hybrid working. As the workforce in Hong Kong is now spending more time working across different locations, company leadership and HR managers are making pivotal shifts in policies as they adapt to the new hybrid reality,” said Paul Macandrew, Country Manager for Hong Kong & Greater Bay Area, IWG. From ‘Human Resources’ to ‘Human Relations’ Human resources were identified as one of the first sectors to reorient themselves. According to the research, more focus would be put on mental health and happier employees. Backing this up was survey data from the City Mental Health Alliance Hong Kong, which has shown a rising trend in employees who recognise investments in both resources and cultural aspects of mental health and wellbeing. A better way to measure productivity Better ways of measuring productivity were also highlighted, as the research pointed to a cloud-based workflow to help evaluate an employee’s work effectiveness. Hyper flexibility is no longer just ‘nice to have’ Data from a survey conducted by IWG highlighted over 70% of job seekers looking for flexible work policies, with another survey also showing that 72% of all office workers would choose hybrid working over a 10% pay raise. A broadening talent pool Meanwhile, a widening talent pool was also expected to take place due to the same hybrid model. Hiring managers would be able to cast a wider net in their search. This would help spur efforts to build a more inclusive and diverse workforce. Reimagining the workplace The workplace is also expected to be redesigned, as companies will need to re-assess the role of the physical office. 6

HONG KONG BUSINESS | Q2 2022

The global BNPL market is projected to be worth $3.98t by 2030

Here’s how you build a successful BNPL: study

etting the right specialised talent and building a good technology stack with the right partners are amongst the core building blocks needed in order for businesses to launch a buy now, pay later (BNPL) solution successfully, according to a joint study published by publishing services firm Deloitte and cloud banking platform Mambu. “BNPL is now a key sales and conversion driver for retailers and e-commerce providers. Merchants, if they have not done so already, are looking around for an embedded finance solution that can help them design BNPL experiences at speed and at low-cost,” said João Caldeira, partner at Deloitte. He added that BNPL is now seen as a new revenue driver. Caldeira notes that the ability to quickly add seamless installment-based digital payments at the point of decision has the potential to change a business.

BNPL is now a key sales and conversion driver for retailers and e-commerce providers

Deloitte and Mambu have teamed up to list five core building blocks for businesses looking to develop BNPL solution. First is the value proposition: that is defining and understanding what merchants and customers need and developing a model to solve their key pain points. Technology and data are another core block. “Developing a technology stack with best-of-breed partners to enable real-time decisioning as well as the creation of next-generation solutions that deliver distinctive customer experiences,” they wrote in the report. Risk and compliance is also key to BNPL. Service providers are tasked with designing a risk framework that provides a competitive edge, from in-built fraud detection and management to defining the risk appetite, model, and strategy Businesses are also called to invest in specialised talent in critical areas to complement businesses’ existing teams, as well as build their brand and differentiate their products and services in the market. The final core building block, “go-to-market”, would see businesses bundling the offering within their portfolio and bringing the minimum viable product to life. Deloitte and Mambu were inspired to make the report amidst booming demand for BNPL services. The global market is projected to be worth $3.98t by 2030, growing at a compound annual growth rate (CAGR) of 45.7%. In Hong Kong, livi is the first bank to introduce BNPL. The livi app offers a range of mobile payment solutions through UnionPay QR Payment, and livi Debit MasterCard. The innovative BNPL product is called ‘livi PayLater’.

Livi is the first bank in Hong Kong to introduce BNPL

FIRST

Thomas Leung

Executives’ confidence in their revenue growth also declined

HK CEOs’ confidence in economic growth wanes

nly 62% of executives in Mainland, China and 68% in Hong Kong expressed optimism on near-term economic prospects, making them less confident than their global counterparts (77%), a study by PwC found. There was also low optimism toward their revenue growth prospects amongst both HK and Mainland CEOs, the study said. Confidence in revenue growth amongst Hong Kong CEOs declined by 2%, and only 48% of Mainland China CEOs expressed

high confidence. Mainland Chinese CEOs cited health risks (42%) as the top threat to their respective company’s growth in the next 12 months, followed by macroeconomic volatility (41%), geopolitical uncertainties (32%), and climate change (31%). Since the study was conducted in October and November 2021, it has yet to reflect the spread of Omicron in China, as well as the geopolitical tensions between Russia and Ukraine. Meanwhile, Mainland China was

CEOs will need to rethink their strategic roadmap for sustainable growth

named the top market for growth amongst HK CEOs (78%) and ranked second amongst global CEOs (27%). Mainland Chinese CEOs, for their part, are considering the US (29%), Australia (24%), Germany, and Japan (23%) as their most important overseas markets for revenue growth over the next 12 months. In terms of priority markets for outbound investment, Mainland Chinese CEOs are targeting Asia Pacific (66%), Belt and Road countries and regions (50%), and the EU (48%) in the next 12 months, while Hong Kong CEOs plan to invest in the Asia Pacific (69%) and ASEAN markets (46%). “In the past year, China’s economy has maintained a steady recovery trend even in the complex and severe domestic and foreign context, facing many risks and challenges. Looking into 2022, businesses can expect to face additional challenges posed by macroeconomic volatility, geopolitical tensions, cyber risks, and the increasingly urgent need to transition to a net-zero economy,” Thomas Leung, Managing Partner - Markets, PwC China said. “Looking ahead, CEOs in Mainland China and Hong Kong will need to rethink their strategic roadmap for sustainable growth and identify longterm growth opportunities by going beyond short-term financial metrics to navigate these turbulent times and ensure sustained outcomes,” he added.

HK, CHINA AVIATION ‘FLY INTO ANOTHER YEAR OF LOSS’: JEFFERIES

n an equity research report, financial services company, Jefferies, said Hong Kong and Chinese airlines have suffered their third year of loss, with international travel delayed to the end-2022 and domestic ticket prices only marginally higher on slower economic growth. Domestic passengers will be the main revenue driver with domestic passenger flight capacity quickly rebounding close to pre-pandemic levels once the local COVID infection outbreaks subside. However, Jefferies expects pre-fuel surcharge domestic ticket prices to increase to only 2%, given price-conscious travellers on slower economic growth. The JEF Global strategy team noted China’s 5.5% GDP growth target seems ‘ambitious’. It is estimated that in 2022 and 2023 to return to 94% and 100% of prepandemic levels.

Jefferies also expected international travel to be delayed until the latter part of this year, at the earliest, and more likely 2023, as China is unlikely to relax its zero-tolerance COVID policy especially given the current local COVID-19 infection outlook. The international passenger capacity has been predicted at only 20% of pre-pandemic levels in 2022 and 60% in 2023. Meanwhile, cargo remains a tailwind with global air cargo sector imbalance driven by the lack of belly space from passenger planes. Lastly, Jefferies forecasted the key driver for customers will be the relaxation of the current HK-crew strict quarantine policy, imposed since December 2021 and the reason for the year-to-date losses. The key date could be 21 April, when the first phase of HK social distancing measures are relaxed. Similar to the return to the second half of 2021 profit, cargo will be the driver.

Hong Kong and Chinese airlines have suffered their third year of loss

HONG KONG BUSINESS | Q2 2022

FIRST The medical service robots have provided service at Haven of Hope Hospital and Kowloon Hospital

Medial service robots reduce direct contact between people and solve the challenges of manpower shortage due to staff infection

HKPC develops service robots to address manpower shortage

he Hong Kong Productivity Council used advanced technologies such as artificial intelligence (AI) and robotics to develop intelligent service robots that fit into different scenarios. Necessitated by the COVID-19 pandemic, they were aimed to not only reduce direct contact between people but also solve the challenges of manpower shortage due to staff infection. Customer service robots The customer service robots share employees’ duties as receptionists and patrollers. It helps answer customers’ questions, broadcast public announcements and crowd control

messages, making it become a new generation of “safety ambassadors”. This robot can naturally chat with guests in Cantonese, English and Mandarin, and has an object recognition function based on AI-trained models to avoid obstacles at work. Frontline medical service robots In view of the manpower shortage in Hong Kong’s healthcare system, HKPC has developed a frontline medical service robot to help frontline medical staff reduce their workload and avoid direct contact between visitors, patients and medical staff. On top of its basic customer serviceability, this robot can also assist in directing and

guiding visitors to the destination of various hospital facilities, checking the temperature of visitors and whether visitors are wearing masks, and broadcasting relevant warnings. This robot has natural language processing and obstacle avoidance functions. These medical service robots have provided service at Haven of Hope Hospital and Kowloon Hospital. HKPC is exploring cooperation opportunities with the Hospital Authority on the application of this frontline medical service robot. Document delivery robots The document delivery robot assists employees in passing documents or materials to colleagues, thus reducing direct contact between employees. The robot can move freely around the office with simultaneous localisation and mapping navigation. Employees can assign tasks to the robot through a mobile App conveniently and put the documents into the electronic locker to prevent them from being lost or exposed in transit. This robot is currently operating at HKPC Building. Disinfection robots The disinfection robot uses its existing robotics platform and cooperated with other professional disinfection robot companies, providing users with an automated all-round disinfection solution to help improve the enterprise’s work efficiency, save manpower, as well as disinfect different premises.

Over half of Hong Kong SMEs expects to overcome 5th COVID-19 wave

espite the fifth COVID-19 surge in Hong Kong, 55% of small and medium-sized enterprises (SMEs) in Hong Kong are confident that they will survive the worsening health crisis, according to a poll conducted by CPA Australia, a global professional accounting body. CPA Australia’s 13th Asia-Pacific Small Business Survey also found that 57% of SMEs project that their revenue will stay normal or increase in the next three months. On the negative effects of the fifth wave, 35% of SME owners said business operations will most likely be hit by the pandemic, followed by 26% of respondents who said cash flow will be bruised during the surge. Also, survey results showed that 42% of respondents said relaxed social distancing measures will positively affect their business in the next three months, whilst 18% of respondents said employment support schemes will have a positive impact on their business. This was followed by 12% of respondents who believed consumption vouchers will have the most positive effect on their operations. It can be recalled that in March 2022, the Hong Kong government declared it will relax most of social 8

HONG KONG BUSINESS | Q2 2022

distancing measures from 21 April in three phases as long as the pandemic situation shows no signs of rebound and the number of COVID-19 infections continues to decline. Janssen Chan, the chairperson of CPA Australia’s SME Committee in Greater China, said Hong Kong businesses are already resilient and adaptable amidst the impact of the fifth wave because of online and digital payments options. “The pandemic is a major catalyst for transforming business models and consumer spending patterns. In Hong Kong, more consumers are purchasing online and using digital payments,” he said in a statement. “With social distancing restrictions set to relax from mid-April and the roll-out of stimulus measures such as the e-consumption vouchers, small businesses should continue innovating, digitalising and updating their business plans to ensure they are best placed to rebound in the second half of 2022,” added Chan. Nearly 300 Hong Kong-based accounting and finance professionals working for SMEs were respondents in the survey, which was conducted from November to December 2021.

RETAIL

General Mills China bags Retail award at the China International Business Awards Häagen-Dazs and Musée du Louvre’s partnership combines gustatory delight with fine art.

eneral Mills Holding Inc., a global leader in the manufacturing and marketing of branded consumer food, was recognised at the China International Business Awards 2021 in the Retail category. This is thanks to the successful launch of its mooncake ice cream project in partnership with the world-famous art museum, Musée du Louvre. The awards body acknowledged the company’s effort for its high-end cooperation

cultural exchanges. That’s the very reason why the company chose to launch at the residence of the Consul General of France. “Häagen-Dazs mooncakes have been deeply rooted in the hearts of local consumers, but we have not stopped our pace, every year we make something extraordinary in our brand theme and innovations,” said James Chiu, Vice President and Managing Director of General Mills China. For Chinese people, the Mid-Autumn

HÄAGEN-DAZS ACTIVELY ADAPTS TO NEW AUDIENCES AND DIGITAL CHANNELS IN DEVELOPING CREATIVE PRODUCTS TO INSPIRE CONSUMERS’ LIFESTYLES with the art industry, for creating a brand new “net celebrity” taste to fit the traditional festival atmosphere and cater to consumers’ tastes; and for its multi-channel integrated marketing and PR strategy. Through the partnership, the company’s premium ice cream, Häagen-Dazs, was branded taking inspiration from the classic collections of Musée du Louvre in terms of both taste and packaging design. Being the first ice cream brand to partner with Musée du Louvre, Häagen-Dazs is not just a brand that makes the most extraordinary ice cream the world has ever tasted but is a cultural icon that shoulders more responsibilities for promoting cross-

festival is the time to express miss and care to their families. The fine art packaging of Häagen-Dazs mooncake ice cream gets just in time for the celebration of the traditional Chinese festival. The innovative collaboration between the two esteemed figures endows more artistic value to moon cake, the traditional Chinese food. The premium ice cream collection has fully upgraded seven series of products that were inspired by the “glass palace” at the entrance of the Louvre. It aims to address the highend luxury gift needs of different groups of consumers during the Mid-Autumn Festival. “Häagen-Dazs has made great innovations in taste, rolled out a variety of innovative

mooncakes that cater to the tastes of Chinese consumers and fit the traditional festival atmosphere,” James noted. The new packaging of the mooncake ice cream was inspired by eternal masterpiece sculptures including Dianna, Athena, Cupid, Venus, and Nike, as well as the famed Mona Lisa painting of Italian artist Leonardo da Vinci. Each box matches the symbolism of the aforementioned art pieces and is labelled in accordance with their representation. The package also included a moon-shaped night lamp, plus a miniature glass palace of the Louvre, and beautiful paper coupons designed like tickets to the museum. As a pioneer brand embracing “New Retail”, Häagen-Dazs actively adapts to new audiences and digital channels in developing creative products to inspire consumers’ lifestyles. Its unique marketing and PR strategy not only let the company benefit from the significance of the festivities, but it paved the way to bridge an exchange of culture through tradition, culture, and art by providing a unique artistic experience. “We would like to take this opportunity to invite Mr. Benoît Guidée, Consul General of the Republic of France in Shanghai, Mr. James Robert Heller, Consul General of the United States in Shanghai, and leaders of Shanghai People Foreign Friendly Association to join us, experiencing this China-meets-France cultural charm, and together endorse the sweet celebration with an iconic product series that represents a cultural fusion,” said James. With over 20 years of market dominance in their respective field, the company follows through with its mission and determination to move with consumer-centred strategies that constantly respond to market changes and demand.

CONTACT General Mills China Address: 12F, Gubei International Fortune Center, No.1438 Hongqiao Road, Changning District, Shanghai Contact Number: +86-021-22237777 Website: www.generalmills.cn

HONG KONG BUSINESS | Q2 2022

HR BRIEFING

Competing for the best talent in Hong Kong’s shrinking talent pool

About 85% of employers are concerned about the talent shortage.

“The new normal has highlighted the importance of physical and mental wellness and I believe that employers who truly get behind this will see big gains in terms of culture and employee retention... and output,” Tibbatts added.

Hong Kongers report higher productivity and less stress when working remotely

ompanies racing to fill roles—this has been the state of Hong Kong’s job market as its talent pool continues to shrink year by year. In 2022, the struggle to reel in employees remains to be felt by 85% of companies, according to the Digital Salary Survey 2022 by Robert Walters and Walter People. The shrinking talent pool, however, can be broadened, and employers can even net the best in the workforce if they dive into different strategies, according to analysts. Capitalising on the new normal Based on the Digital Salary Survey, 78% of professionals would likely join a prospective employer if they offer a hybrid working arrangement. “In Hong Kong’s extensive corporate and financial services sector, firms with hybrid working and modern agile workplaces combined with the most cutting edge and mobile suite of technologies will get ahead of other employers that have been slower to invest,” Michael Page Hong Kong’s Managing Director Mark Tibbatts told Hong Kong Business. The flexible working arrangement also allows employees and employers to “cut out waste” be it “wasted workspace, resources, time or money,” Tibbatts explained. “The big opportunity is in harnessing greater productivity across a whole suite of areas, which is helping companies be leaner, greener, and better performing employers, whilst enabling people to balance work and family/personal life better making for happier employees,” Tibbatts said. Last year, Randstad found that two in five Hong Konger reported higher productivity by working remotely, whilst three in 10 felt less stress under such a work setup. In another survey by Microsoft, it was found that 66% of Hong Kong employees want to retain flexible working arrangements and about 65% of business leaders in the city are already planning to redesign offices for hybrid work. 10

HONG KONG BUSINESS | Q2 2022

Mark Tibbatts

Carly Adams

Firms with hybrid working will get ahead of other employers that have been slower to invest

Reviewing hiring process As the world moves under the new normal, 89% of organisations globally have already moved to virtual interviewing for recruitment, a 2020 research by Gartner revealed. Tibbats suggested that companies should also take advantage of this and maximise the use of video technology in terms of their hiring process. “Employers who adopt this will open themselves up to greater applicant traffic as there is less of a burden or commitment or risk to job-seeking where virtual meetings are part of a process,” he said. “Face to face interviews require longer planning and time commitments that may deter some qualified candidates,” the analyst added. Kate Kwan, Team Lewis’ General Manager for Hong Kong, echoed the suggestion, saying companies should simplify and shorten their hiring processes. A PwC survey said 49% of employees would turn down job offers because of poor recruitment experience, including a long hiring process which was experienced by at least 67% of job seekers. Carly Adams, director of Walters People Hong Kong, warned that time delays between interview rounds or nonessential interview participants will very often mean that companies “will miss outon their preferred candidate.” Growth opportunities Kwan said Hong Kong candidates are leaning towards companies that emphasise learning and development and growth opportunities. This was echoed by Tibbatts, saying that “investing in training and development, plus providing clarity and scope for appealing career progression is also still important.” According to Mercer’s 2021 Global Talent trends, 53% of employees in Hong Kong are actively identifying new skills and capabilities needed for post-COVID operations, whilst 39% are expanding their talent and learning eco-system. Purposeful work Candidates now have the desire to be part of a bigger purpose, according to Kwan. “We know that candidates are paying more attention to company values and culture, making it a big part of their decision-making process,” Kwan said. “With Gen Z entering the labour market, we must be more creative and innovative in terms of talent acquisition.”

HONG KONG BUSINESS | Q2 2022

LEGAL BRIEFING

Rent control bill aims to bury abusive ‘coffin home’ landlords

A ban on rent hikes in the first 2 years and caps on increases in subsequent years has landlords worried.

t has been over two decades since rent controls have been implemented in Hong Kong, a city that has usually been laissez-faire with price controls; which is why for low-income families dwelling in subdivided units (SDUs) who have been grappling with high rents, plans under the Landlord and Tenant (Consolidation) (Amendment) Ordinance 2021 to prohibit any increase in the rent for the first term of tenancy, which is equivalent to two years, should be welcomed. On renewal, which is another two years, landlords of the so-called “cage houses” or “coffin homes” may only increase rent up to a 10% cap, but they may be restricted to an even lower rent rise. The rent hike for the second term tenancy is determined by the percentage change of the citywide rental index published by the Rating and Valuation Department, which means that landlords cannot always increase the second term rent by 10%. “If the percentage change of the relevant rental index published by the Rating and Valuation Department is lower than 10 percent, the landlord can only increase the rent to such percentage at most. If such percentage is negative, then the rent must be reduced at least by such percentage,” Lilian Chiang, a senior partner at Deacons, explained to Hong Kong Business. In general, what the bill aims to do is safeguard tenants’ security of tenure and protect them from arbitrary rent increases. Some legal experts have cast doubts on whether the bill will actually work as intended. Chiang expressed doubt as to whether the bill can effectively protect tenants because it does not regulate initial rent fees. “Since there is no restriction on the starting rent fee of the first-term tenancy… the landlords may charge a higher starting rent to offset the cap on increase of rent fee,” she said. This view was shared by Janice Yau Garton, a partner at Stephenson Harwood LLP, who told Hong Kong Business that “without regulation on initial rents and rents of future renewals after the protected 2+2-year terms, the problem of excessive rental hikes does not go away permanently.”

A loss for landlords? Since the measure was only implemented on 22 January, Garton said tenancy agreements entered before its implementation could have high rent, unfair terms and/ or a longer rental term, circumventing the purpose of the amendment ordinance. Another provision of the bill that would push landlords to greatly increase rent fees for existing and new tenancies alike is the forbiddance of overcharging tenants for utility bills, Doreen Kong, a partner at ReedSmith LLP, told Hong Kong Business. Under the bill, “if the utilities of the SDUs are 12

HONG KONG BUSINESS | Q2 2022

On renewal, landlords of so-called “cage houses” or “coffin homes” may only increase rent up to a 10% cap

Lilian Chiang

Janice Yau Garton

Doreen Kong

On renewal, landlords of so-called “cage houses” or “coffin homes” may only increase rent up to a 10% cap

not separately billed, the landlords can only seek reimbursement from the tenants if copies of bills and accounts showing how the amounts are apportioned to different parts are provided to the tenants, and the aggregate of the apportioned amounts do not exceed the billed amounts,” Chiang also explained. If landlords will not impose increased initial rents, they will likely put the quality of their substandard flats at stake to counteract the rental hike cap, reducing the cost of repair and maintenance during the first two terms when they need to shoulder it, Chiang said. One of the biggest disadvantages that the bill brings upon landlords is their inability to terminate a regulated tenancy to sell their property with vacant possession, Garton said. Such tenancy restrictions impair a landlord’s “property rights through restricting their rights to the use and disposal of property guaranteed by Articles 6 and 105 of the Basic Law,” Kong further explained. “It remains doubtful whether an appropriate balance has really been struck between the protection of tenants and interests of the landlords,” Kong added. A band-aid solution Looking at the bill’s effect on a larger scale, particularly on Hong Kong’s housing crisis, Kong said the measure is at most a “band-aid on a bullet wound.” Kong added that there’s a need for a “comprehensive and integrated plan on tackling housing problems.” Garton agreed, saying that HK needs longer-term housing policies like building transitional housing, increasing housing supply in a faster and more efficient manner, and tighter regulations overbuilding and fire safety since its housing problem is a multi-layered issue that cannot be solved overnight. “The rental control policy is a short-term, perhaps temporary, measure that does not resolve underlying issues in the Hong Kong market,” Garton said.

HONG KONG BUSINESS | Q2 2022

MARKETING BRIEFING

Prepare to go cashless or pay the price One in three consumers will abandon a purchase if they cannot pay for it digitally.

ith more consumers planning to drop cash and go fully digital with their payments in 2022 and in years to come, and with one in three abandoning a purchase when not given a digital payment option, small businesses really have no other way to go than shift to cashless. Fortunately, a majority (95%) of small and medium enterprises (SMEs) are planning to accept contactless payment or some form of digital payment option in 2022, according to Visa. For the remaining 5%, they might have no choice but to hop on to the cashless movement. “It is a matter of time for the cashless payment transaction to further penetrate into SMEs and independent retailers,” Herbert Yum, research manager at Euromonitor International, told Hong Kong Business. According to Yum, SMEs can “either develop their platforms for their product and services to list out for consumers to choose and proceed to checkout or simply list their product and services on other e-commerce platforms,” depending on the missing pieces of their online capabilities. “The former choice would require small and medium enterprises to invest in payment solutions or use thirdparty payment services, where the latter would reduce SMEs initial investment on such solution and result in higher cost of sales,” Yum added. Will cash bid adieu? Amongst the digital platforms, mobile apps are the most commonly used by Hong Kong shoppers (50%), followed by a web browser on a computer (23%), and a web browser on mobile (16%), according to Visa. As for businesses that focus on offline channels, Yum said they could invest in point of sale (POS) systems, either through a POS device or using a mobile device as a POS terminal to receive payment. Yum cited HSBC’s mobile payment service, PayMe, as an example. “Either way, the point of sale terminal for them to receive digital payment would be a must for them to

95% of SMEs plan to accept contactless or digital payment option in 2022

HONG KONG BUSINESS | Q2 2022

Herbert Yum

Gary Ng

It is a matter of time for the cashless transaction to further penetrate into SMEs and independent retailers

adapt to the ongoing shift towards a cashless society. Followed by product and services listing platforms, as well as logistic capabilities for them to deliver their goods to customers,” Yum added. PwC Risk Assurance Partner, Gary Ng, for his part, said small retailers can tap a number of Store Value Facilities (SVF) service providers in Hong Kong which offer low-cost cashless payment services. The list of these SVFs can be found on HKMA’s website: https://www. hkma.gov.hk/eng/regulatory-resources/registers/registerof-svf-licensees/. With the growing demand for new modes of payment, will Hong Kong finally bid adieu to cash? Ng said it depends on what is being looked at. In terms of infrastructure and customer demand, Ng said Hongkong is ready to shift to a fully cashless society. However, that is not the case on the merchant side because, according to Ng, cash will still be used in several transactions in Hongkong, particularly amongst smaller merchants. This is backed by Visa’s Back to Business Study, which found that 16% of small businesses said they will never make the shift to digital payments only. One of the reasons why smaller merchants are not inclined towards shifting to cashless transactions is probably because of the fees that come along with implementing electronic payments, Ng said. “They need to pay some fees 1-5% depending on the type of payment vehicles that they’re using,” he said. Ng said financial services could most likely play a part in easing the burden smaller of merchants by offering cheaper payment acquiring services, which in turn, would benefit them since they will be able to acquire a larger pool of customers. Checklist for going cashless For those planning to change to cashless, Euromonitor International’s Yum left a checklist of what businesses should consider before adopting new payment methods. According to Yum, businesses should first have a good understanding of consumers’ preferences; their distribution model; and the additional solutions that accompany the payment solutions they will adopt. As for consumer preference, Yum said buy now pay later (BNPL) scheme is the latest type of cashless payment solution to gain ground in Hong Kong—an example of this is Atome. The payment intermediary helps retailers increase their conversation rate and checkout basket size without any additional interest fee, according to Yum. Apart from BNPL, Ng said other popular cashless payment tools in Hong Kong include QR code payments, mobile e-wallets, and faster payment systems (FPS). The government is also exploring different options to strengthen the city’s cross-border payment systems leveraging the success of these platforms, added Ng.

HONG KONG BUSINESS | Q2 2022

INSURTECH

YAS MicroInsurance puts a price on NFTs

The insurtech firm is one of the first in the industry to insure non-fungible tokens.

artists, exhibitions, and galleries. As the rapid growth in asset value of NFT grew, YAS believed that NFTs are the same as classic cars, therefore they needed an insurance solution. With that, YAS pioneered NFTY, an NFT insurance that protects these digital assets from capital loss such as theft or malicious attacks on digital wallets and the marketplace. Unlike current insurance products that protect physical assets, YAS dedicated its policies to “digital collectables only” that are uniquely registered on the blockchain. As all the NFT data is stored on a public blockchain representing digital property rights, YAS MicroInsurance’s contract insurance policies define the NFT values and fully insure at their market value.

YAS pioneered NFTY, an NFT insurance that protects digital assets from capital loss

nsurtech firm YAS MicroInsurance has done what many thought was impossible: putting a price on NFTs or nonfungible tokens—a digital asset that a person cannot use or consume in a physical sense. As one of the first insurtechs to give NFT insurance in 2021, Andy Ann, co-founder and CEO of YAS MicroInsurance revealed to Hong Kong Business that pricing for NFT can be derived in a few ways, such as past transaction values. “First of all, NFT is a tangible asset, it is a smart contract, and we are insuring the smart contract on both theft and loss coverage. The pricing principle is similar to collectable insurance, which is priced in terms of premium and coverage. The premium pricing is based on risk levels calculations, and the coverage 16

HONG KONG BUSINESS | Q2 2022

Andy Ann

We have started to compute premiums at 20% of the NFT price and cover 90% of the purchasing price

amounts up to x% of the asset is also standard practice. We target to lower the premium when we scale up to a specific mass volume in the long run,” Andy explained. According to Andy, all the NFTs that they have insured so far are on average 2-5 Ethereum (ETH) with the bigger sizes ranging anywhere from 12-22 ETH. “As it’s a very new product, we have started to compute premiums at 20% of the NFT price and cover 90% of the purchasing price,” Andy added. The NFT market is currently growing at an accelerating rate. In 2020, the market was worth around $350m which ballooned to around $24b at the end of 2021. According to Andy, the initial idea of launching an insurance product for NFTs came from their partnership with several musicians,

Need for protection Andy explained that this is the perfect time to launch this product because as the market for NFTs grows, so do attacks and thefts. “We see a handful of hacks such as the Banksy scam with fake banksy NFT was listed on Open Sea and sold for $350,000; hacks on Nifty Gateway; Evolved Apes; Bored Monkey Yacht Club phishing scam stole $2.2m; and most recently we see Monkey Kingdom had a phishing link that over $1.3m worth of cryptos were stolen,” Andy said. With NFTY, 90% of the purchase price of the NFT is covered. However, theft coverage can only be activated if it is reported to local authorities within 24 hours of its theft or if the insured item is not stored in a secure location with at least two-factor authentication. Future outlook Andy believes that the NFT market would grow a hundred fold in the next few years representing the beginning for the insurance business of the market as artists, photographers, gamers, musicians, collectors, brands, and all kinds of curators come together.

HONG KONG BUSINESS | Q2 2022

DIGITAL - TECHNOLOGY

The customer (experience) is always right: a business case for personalisation By Rajen Sanggaran, Head of the Asia Pacific and Japan at Pegasystems

For example, the Commonwealth Bank of Australia successfully used personalisation to deliver industry-leading customer service ratings. Using Pega’s Customer Decision Hub, the bank created an AI-powered engine capable of connecting conversations across 18 channels, delivering 50 million next-best conversations. In addition to personalisation, organisations are also using process automation and case management to drive business performance. Businesses should provide customers with a unique experience customised for their needs This creates a powerful, single solution that not only elevates the customer experience but the employee experience too. By they enter their favourite stores, restaurants, s humans, we want to be treated consolidating all internal processes within or cocktail bars. If another patron is lucky as individuals, and not the “next a single system, organisations can reduce enough to win big, they will receive an offer customer”. For many sectors, from the time it takes to process requests for to stay at the presidential suite, including a banking, insurance, to gaming and air travel, customers and staff alike. discount for an extended stay. personalisation has always been key to the A centralised solution can deliver multiple An office worker is embarking on a New customer experience. 30 years ago, it meant benefits. Recently, Pega worked with a major Year’s resolution to get fit and begins tracking flight attendants greeting you by name on your airline to implement a unified cloud platform their daily runs and eating habits. Using the flights. It meant bank managers building lifethat brought staff together across multiple health data from a smartwatch and associated long relationships with customers. Or it meant channels. With new user portals, chatbots, apps, the office worker’s insurance company the hotel concierge asking about your family dashboards, knowledge management, and AIcan provide customised wellness offers before checking you into your favourite room. powered self-services, the airline significantly as they demonstrate their commitment to Thanks to modern technology, the nature of improved service request turnaround times. healthier living. personalisation have evolved, and it’s opening The cloud solution reduced costs by allowing A business traveller boards their weekly new avenues for innovation in customer the airline to retire legacy systems and flight to another city for work. Upon entering experience. improved customer satisfaction through fast the plane, they are surprised to see the usual The next stage of personalisation – realservice delivery. flight crew have been replaced with a new time, AI-driven, with low-code development For developers, Pega’s low-code capability team. However, without skipping a beat, the The goal of personalisation remains the drastically improves productivity helping flight attendant leads them to their seat and same – to provide each person with a unique major enterprises like experience customised THE BEST WAY TO FUTUREPROOF A BUSINESS IS TO USE OCBC and Sun Life for their needs. It is TECHNOLOGY THAT CREATES THE KIND OF EXPERIENCES “Build for Change” and moving quickly, from including names in CUSTOMERS ACTUALLY WANT AND EMPOWERS EMPLOYEES adapt quickly to shifting customer needs and emails to using AI to TO SUCCEED business priorities. For tailor interactions HSBC, Pega’s approach hands them their usual glass of champagne. In with customers in real-time. Personalisation has delivered solid business outcomes, such this scenario, low-cost airline Transavia used solutions can now make decisions in under as growing revenue per contact by 265% and Pega’s CRM solution to build a personalisation 200 milliseconds, analysing a customer’s increasing email open rates by 200%. platform that provided staff with a holistic digital and physical exchanges to deliver the Moving forwards, business success will profile of each customer, detailing their best interactions for each individual, on their depend on an organisation’s ability to attract personal preferences. channel of choice. and retain its customers and employees. So, how does personalisation drive business In practice, it means that businesses can The best way to futureproof a business is performance? communicate with customers when they to use technology that creates the kind of Using data, AI and automation and low-code are at their most receptive, with messages processes, businesses can personalise at experiences customers actually want and crafted for context and relevance. Here are a scale to improve the experience of hundreds few examples: empowers employees to succeed. of thousands of customers. This lays the When a casino patron flies into Macau, For more information on how your foundation for strong customer acquisition data on their personal preferences and past organisation can improve its personalisation and retention, key drivers of sustainable purchases are used to create customised and business performance, please get in touch business growth. offers. These are sent to the patron as soon as via Pega’s Contact Us page.

HONG KONG BUSINESS | Q2 2022

RANKINGS: INSURANCE INDUSTRY

Time for a comeback? Hong Kong’s top 50 insurers show a 9.75% surge in assets Health and wellness products and services still remain a priority for the industry.

ith the skies clearing, Hong Kong consumers will still make sure they have an umbrella handy—something Hong Kong insurers took note of as they ready health and wellness products and services for 2022. Hong Kong Business 2022 Insurance Rankings has revealed that the industry’s top 50 insurers total assets surged by 9.75% to HK$709b in 2020 from HK$646b. AIA International continued to retain its number one spot in the rankings despite its total assets declining to HK$126b in 2020 from HK$141b in 2019. This was also the case for Prudential (HK) Life. With its total assets dropping from HK$111b to HK$92b, it still managed to retain the second spot in 2021’s rankings. China Life took the third spot with HK$67b in assets with Manulife following close behind at fourth with HK$63b. Completing the top five is HSBC Life at $54b. Going by the numbers More Hong Kongers are starting to act upon their future, instead of just passively worrying about it. This has been evident in Hong Kong’s Insurance Authority’s (IA) annual report with the Individual Life business remaining to be the dominant line in the business, making up HK$458.5b or around 87.9% of total long-term business. The report also showed a modest rise in total office premiums for in-force long-term business by 2% to HK$521.4b in 2020. What probably slowed down the long-term business is the 20.9% decrease in office premiums for new individual life business to HK$119.6b in 2020, including HK$106.8b from Individual Life (NonLinked) business and HK$12.7b from Linked business, which recorded a decrease of 23.4% and an increase of 8.8%, respectively. The total number of new policies decreased by 20.8% to 1 million in

HONG KONG BUSINESS | Q2 2022

More Hong Kongers are starting to act upon their future

Today around 30% of total healthcare expenditure is ‘out of pocket’

2020. Office premiums for the new Individual Annuity business decreased by 36.3% to HK$13.3b. Meanwhile, the general insurance market performed admirably despite the considerable pandemic-related challenges in the past two years. Total gross written premiums recorded a growth rate of 8% to HK$59.8b in 2020. Overall underwriting profit hit HK$2.3b, a major increase from HK$869m in 2019. The IA said that the biggest contributor to the general insurance market’s growth was property damage, general liability, and pecuniary loss business. Rate increase and new business continued to fuel property damage and general liability business which both showed double-digit growth of 17.6% and 10.4% each. Upward adjustment of the maximum property values for the Mortgage Insurance Programme propelled forward mortgage insurance business, driving an upsurge of 57% in the Pecuniary Loss business. The pandemic, however, took its toll on direct sales of medical and travel insurance and had dampened the accident and health business, which saw a decline of 3.5% in 2022.

Health and wellness Despite challenges in sales of medical insurance, however, HSBC Life Hong Kong CEO Edward Moncreiffe said that health and wellness will continue to be a trending focus in 2022. Moncreiffe said that customers see health across three dimensions, namely physical, mental, and financial health. He added that this was supported by a global study they conducted last year which saw eight out of 10 believe that they need to be both physically and mentally healthy to enjoy their financial wealth. This was seconded by Damien Green, CEO of Manulife Hong Kong and Macau, adding that retirement funding needs in Hong Kong remain huge, as well. “Today around 30% of total health care expenditure in Hong Kong is ‘out of pocket’ which represents the big job on our hands to properly insure our community,” Green said. For Green and Manulife, they are also preparing for an influx in demand from mainland Chinese residents for health and retirement insurance solutions.

RANKINGS: INSURANCE INDUSTRY INSURANCE COMPANY

Classification

2020 TOTAL ASSETS*

2020 RANKING

2019 TOTAL ASSETS

AIA International

LIFE

$126b

141b

Prudential (HK) Life

LIFE

$92b

111b

China Life

LIFE

$67b

76b

Manulife (Int'l)

LIFE

$63b

59b

HSBC Life

LIFE

$54b

59b

BOC LIFE

LIFE

$39b

38b

Sun Life Hong Kong

LIFE

$32b

16b

AXA China (Bermuda)

LIFE

$30b

30b

2021 RANKING

FWD Life (Bermuda)

LIFE

$28b

TPLHK

LIFE

$20b

16b

Hang Seng Insurance

LIFE

$18b

21b

FTLife

LIFE

$13b

12b

YF LIFE

LIFE

$10b

11b

Bupa

GENERAL

$10b

AXA General

GENERAL

$9b

4b 7b

BEA Life

LIFE

$8b

CTPI(HK)

GENERAL

$6b

FWD Life (HK)

LIFE

$4b

21b

Hong Kong Life

LIFE

$4b

Chubb Life

LIFE

$4b

AIA International

GENERAL

$4b

AXA China (HK)

LIFE

$4b

BOC Group Insurance

GENERAL

$4b

Generali

GENERAL

$3b

Swiss Re (Asia)

GENERAL

$3b

QBE HKSI

GENERAL

$3b

1b 4b

Zurich Insurance

GENERAL

$3b

TLIC

LIFE

$3b

AIG Insurance HK

GENERAL

$3b

Blue Cross

GENERAL

$3b

Fubon Life Hong Kong

LIFE

$3b

HKMC Annuity

LIFE

$3b

CIGNA Worldwide General

GENERAL

$3b

Liberty Int'

GENERAL

$3b

AXA China (HK)

GENERAL

$2b

Asia Insurance

GENERAL

$2b

Prudential (HK) General

GENERAL

$2b

TPRe

GENERAL

$2b

Target

GENERAL

$2b

879m

Blue

LIFE

$2b

Chubb Insurance

GENERAL

$2b

Allied World

GENERAL

$2b

Utmost Worldwide

LIFE

$2b

Zurich International

LIFE

$2b

2b 1b

MSIG Insurance

GENERAL

$2b

Lloyd's

GENERAL

$1b

Sun Hung Kai

GENERAL

$1b

AGCS SE

GENERAL

$1b

929m

AIA (HK)

LIFE

$1b

Aetna

GENERAL

$1b

TOTAL

709B

*Derived from Hong Kong Insurance Authority’s audited statistics for 2019

HONG KONG BUSINESS | Q2 2022

EVENT: HIGH FLYERS AWARDS

Hong Kong Business lauds exceptional enterprises at the High Flyers Awards 2021

midst the challenging economic backdrop, the annual High Flyers Awards continued to recognise organisations that showed remarkable resilience and shone through the challenges of these times. In its 18th year, the awards programme continues to honour enterprises and companies that exemplify innovation, quality of service and a strong commitment to social progress. “As we move along in the new normal, companies that were able to have an innovative spirit, outstanding service, and relentless effort to contribute to social progress stood out and were able to

show that despite the current situation Hong Kong companies can pull through and shine,” says Tim Charlton, publisher of Hong Kong Business. Presented by Hong Kong Business, the High Flyers Awards 2021 recognised businesses spanning a wide range of industries, including health, banking and finance, marketing insurance, legal services, interior design, food and beverage, and ICT services, amongst others.As a health and safety precaution, the winners will be announced through visual presentations and will be featured in the publication with interviews from their top executives.

High Flyers Awards 2021 Archikris Design Group - Interior Designer Elite Concepts Ltd - Innovative F&B Concepts FEED HK - Integrated Marketing Curator Fidelity International - Financial Services Hang Seng Bank - Commercial Bank Mayer & Associés - Law Firm PrimeCredit Ltd - Outstanding Finance Company Soteria Trusts - Trust and Fiduciary Services Standard Chartered Bank - Bank of the Year UMP Healthcare Holdings Ltd - Health Products & Services

FEED HK

Elite Concepts Ltd

Fidelity International

HONG KONG BUSINESS | Q2 2022

Hang Seng Bank

Mayer & Associés

PrimeCredit Ltd

Soteria Trusts

Standard Chartered Bank

UMP Healthcare Holdings Ltd HONG KONG BUSINESS | Q2 2022

EVENT: MANAGEMENT EXCELLENCE AWARDS

HKB lauds top teams, executives, and innovations at Management Excellence

s industries start to recover, it is high time for companies to start working on new strategies to ensure the success of the business in the long run. To do this, it is important to have a leader who is decisive and a team that is goal-oriented for the business to thrive amidst the challenging economic backdrop. With this, the Hong Kong Business Management Excellence Awards 2021 recognised outstanding individuals, innovators, and teams whose initiatives have brought tangible business gains for the success of their companies. The winners were announced via digital presentations on November 24ᵗʰ and 25ᵗʰ. Companies also

had the opportunity to share their thoughts on winning in the prestigious awards programme through virtual interviews. This year’s nominations were evaluated by an elite panel of judges consisting of Ivan Chan, Audit & Financial Advisory Services Partner at Mazars in Hong Kong; Edward Au, Managing Partner, Southern Region at Deloitte China; Jacky Lai, Assurance Partner at Ernst & Young; Samson Lee, Audit Partner at SHINEWING (HK) CPA Limited; and Eugene Liu, Managing Partner at RSM Hong Kong.

HKB Management Excellence Awards 2021 Executive of the Year • • •

Data Privacy - Crypto.com, Jason W. K. Lau Banking - Fusion Bank Ltd, Patrick Liu Healthcare - Insta Specialist Company Limited, Hole Hau and Hei Ng

Innovator of the Year • •

Healthcare - Insta Specialist Company Limited, Hole Hau and Hei Ng General Insurance - QBE Hong Kong

Team of the Year • • • •

Banking - Fusion Bank Ltd Logistics - DCH Auriga HK Ltd, Operations Team General Insurance - QBE Hong Kong Materials & Construction - Traxon Technologies Limited, Product Portfolio Management Team

Employee Engagement of the Year • •

Apparel - Lacoste Executive Search - Phaidon International

DCH Auriga HK Ltd, Operations Team

Crypto.com, Jason W. K. Lau 24

HONG KONG BUSINESS | Q2 2022

Fusion Bank Ltd

Lacoste

QBE Hong Kong

Phaidon International

Traxon Technologies Limited, Product Portfolio Management Team HONG KONG BUSINESS | Q2 2022

EMPLOYEE ENGAGEMENT OF THE YEAR - APPAREL

Lacoste wins top award for new strategic employee engagement programme The global Values Ambassador Program took off in its headquarters in Hong Kong.

Lacoste Foundation

acked by its years of successful business in the apparel sector, Montaigne Hong Kong Limited (Lacoste) set out to strengthen its identity in both the market and in the industry by redefining its core values. To do this, the company identified that it had to redefine its values and communicate this message in all its global branches. Spearheaded by Lacoste’s headquarters in Hong Kong, it launched the Values Ambassador Program in 2021. The monthly programme focused on shaping the human resources policies of the company and streamlining the managerial practices of its officers. The main goal was to create an impact in the way every employee shall carry out their job. The Values Ambassador Program boasts four core values: play as one team, play with elegance, play by daring, and play with tenacity. To properly disseminate these values, each regional office organised communication sessions to provide a briefer and to talk about how this may be embodied in every Lacoste employee’s daily work. To vote for a Values Ambassador, employees may send a “Values Card” as a form of appreciation to another and describe in it how the receiver embodies a specific value. A copy of the same will be sent to the HR team, which will then consolidate all the cards received by an employee. Apart from this, the company also tracked the interactions among employees and noted who exhibited ideal values for the company. As a reward, recognised employees were announced company-wide and each received a special gift in return.

HONG KONG BUSINESS | Q2 2022

These activities continued even during the period when a work-from-home arrangement was set in place during the pandemic. The Values Cards were sent among colleagues in the form of e-cards and daily interactions among employees were continually monitored by the HR team. It aimed to improve the relations between employees not just in the Headquarters branch, but also in all its other branches found across the globe. The holistic approach was set to reflect its new set of core values that were centred on being able to perform well at work without forgetting the main essence of the play in all employees’ everyday work. For this effort, Lacoste won the Employee Engagement of the Year – Apparel award during the recently concluded Hong Kong Business Management Excellence Awards. The annual awards programme celebrates the city’s most outstanding business leaders. It recognises trailblazers, innovators, and teams whose initiatives have brought momentous success to their companies. The award was given to Lacoste by the judges primarily based on the Values Ambassador Program. It noted how the programme was effectively launched by the Hong Kong branch of Lacoste, which led to the continuing implementation of the same in the other branches of the company found in several countries. For receiving this recognition, the company said that they are honoured to get this award for the first time. Having received this following the launch of its new

core values, Lacoste’s HR felt delighted that its efforts are being celebrated as it continues to bring these new core values globally to its regional branches. Whilst the company only runs the employee engagement survey every three years, it shared that the general observation was that happiness and positive energy among employees improved. It noted the significant changes introduced throughout all their global branches. It also continues to have to catch up sessions with its employees to collect feedback about their various programs and to provide support when needed. The socially responsible company is also doing a project on sustainability called Durable Elegance. It was launched as a series of programmes to protect human rights, contribute to local communities, and help preserve the environment. Apart from those aforementioned, the company also launched other notable programmes such as Mini-Team Building, Values Film Competition, Values Polo Design Competition, and Olympics Day. These were designed to improve employee interaction and support in all Lacoste branches.

Values Ambassador Program

LACOSTE IDENTIFIED THAT IT HAD TO REDEFINE ITS VALUES AND COMMUNICATE AND STRENGTHEN ITS IDENTITY IN ALL ITS GLOBAL BRANCHES BY LAUNCHING THE VALUES AMBASSADOR PROGRAM IN 2021

HONG KONG BUSINESS | Q2 2022

We create insurance solutions

So you can worry less about the risk and focus on the opportunity. QBE has a presence in Asia for more than 100 years with representation in Singapore, Hong Kong, Malaysia and Vietnam. We can combine in-depth local knowledge and expertise developed in each individual market and draw on the collective global resources of the entire Group to provide commercial, personal and specialty products and risk management solutions to our customers. Our success is built on the strength of our partnerships with professional insurance brokers, agents and financial advisors. QBE Asia is part of the International Division of QBE Insurance Group Limited, a general insurance and reinsurance company, headquartered in Sydney and listed on the Australia Securities Exchange (ASX). To learn more about QBE Hong Kong, please visit www.qbe.com/hk 28

HONG KONG BUSINESS | Q2 2022

Talent Drives Growth Sourcing talent can be a slow and costly process, but working with a talent partner can act as a catalyst to securing business-critical talent. Phaidon International is the parent company of 6 leading specialist recruitment agencies. For more than 15 years, we have provided clients and candidates the peace of mind that their recruitment process is in expert hands.

Scan to learn more about the services we oﬀer, the industries we cover and let us know of your hiring challenges.

HONG KONG BUSINESS | Q2 2022

EVENT: GREATER BAY AREA ENTERPRISE AWARDS

Outstanding organisations lauded in the HKB Greater Bay Area Enterprise Awards

he Guangdong-Hong Kong-Macao Greater Bay Area (GBA), expected to be a global technology hub in the next five years, is the perfect place for companies that want to expand and grow their businesses. Its strong positioning makes it the best business location for startups and even established businesses. The development of the area is expected to boost Hong Kong’s status as a global financial and aviation hub. Companies who demonstrated deeper integration or coordinated economic development and initiatives that have shown successful economic impact for the development of the Greater Bay Area

were recognised at the recently concluded The Greater Bay Area Enterprise Awards, presented by Hong Kong Business. The Greater Bay Area Enterprise Awards lauds award-winning initiatives that have been done in the Greater Bay Area to foster mutual cooperation, investment, and development. The awards were presented to the winning organisations via digital ceremonies in the second week of December 2021. Companies also had the opportunity to share their thoughts on winning in the prestigious awards programme through virtual interviews.

GREATER BAY AREA ENTERPRISE AWARDS Hang Seng Bank Limited Payments Banking Standard Chartered Hong Kong Wealth Banking The Hongkong and Shanghai Banking Corporation Limited SME Banking Business Banking Hong Kong Asset Management Ltd Asset Management Huobi Technology Holdings Limited Blockchain EC Healthcare Health & Wellness Mead Johnson Nutrition (Hong Kong) Limited Infant and Child Nutrition Tencent’s Lightspeed & Quantum Studios Media & Entertainment

Hang Seng Bank Limited 30

HONG KONG BUSINESS | Q2 2022

The Hongkong and Shanghai Banking Corporation Limited

Mead Johnson Nutrition (Hong Kong) Limited

Standard Chartered Hong Kong

Tencent’s Lightspeed & Quantum Studios HONG KONG BUSINESS | Q2 2022

WEALTH BANKING

Innovation brings home the bacon on Stanchart’s cross-border service Standard Chartered Bank was recognised in the Wealth Banking category at the HKB Greater Bay Area Enterprise Awards.

tandard Chartered is in a privileged and unique position to help the booming affluent clients in the lucrative Greater Bay Area (GBA) to grow and protect their wealth. With nearly 90 outlets in the GBA, the bank with over 160 years of history in both Mainland China and Hong Kong markets has accumulated a deep wealth of business foundation, cross-boundary advantages and market insights with to serve the growing demand for world-class financial service. As one of the first banks to operate the Cross-Boundary Wealth Management Connect Scheme, Standard Chartered fortifies its status as the “go-to Bank” in the southern economic powerhouse by scooping another award in the Wealth Banking category in Hong Kong Business’ Greater Bay Area Enterprise Awards, which aims to recognise outstanding companies for their excellent performance and commitment to drive collaborative and economic development between Hong Kong and its neighbouring Mainland cities. Standard Chartered reckons individual clients in China and Hong Kong will tangibly benefit from the more convenient crossboundary financial services, thanks to the inauguration of the Wealth Management Connect Scheme last October. To capture this once-in-a-lifetime opportunity in the southern economic powerhouse, Standard Chartered Hong Kong, which became one of the first international banks to sell investment products with more than 100 options for its clients, is well-positioned to provide further diversity of wealth management solutions for its GBA mainland clients to seize the offshore investment opportunities. Leveraging on its global vision and capabilities, the Bank offers a versatile fund strategy that provides a variety of investment choices, covering multiple asset classes such as money market, stocks and bonds, facilitating its clients to stay invested in all weathers. At the same time, thanks to an exclusive partnership with mainland-based asset managers, Standard Chartered China also offers a range of differentiated funds to Hong Kong investors with distinctive mainland features such as China’s new economy and new energy. Being one of the largest wealth managers in Asia, Standard Chartered understands

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GBA Centre

clients are more discerning and demanding better service from their banks. Therefore, the Bank trained up a highly competent and experienced GBA Relationship Manager Team, most of whom are hired from the GBA cities with the same language and culture. With the inauguration of the Standard Chartered-INSEAD Wealth Academy with INSEAD, one of the world’s leading and largest graduate business schools, the bank plans to upskill the Bank’s relationship teams and nurture them to become future-ready advisors, providing timely, personalised and high-quality differentiated wealth advice to clients. The world-class programme, which commenced with its first cohorts of Relationship Managers and Wealth Specialists in Hong Kong last December, further demonstrates the bank’s commitment to the holistic development of the relationship teams and delivering topquality advice to clients. All these investments are aimed to provide seamless services to meet the cross-border needs of the clients. Despite

the pandemic, the Bank offers a crossborder witnessing service to allow the clients to enjoy the convenience of opening accounts without the hassle of travelling and provide a client-friendly remittance service is available for addressing their international needs. To go the extra mile, the bank also creates a dedicated and centralised Wealth Management Connect service team to enhance the client experience on account opening. Standard Chartered committed a total investment of US$40m to set up its GBA centre. Over 500 employees across different departments have moved into the Centre, and it has been in full operation since Q1 2022. The Standard Chartered GBA Centre, which plans to increase its headcount to 1,600 by 2023, acts as a centre of excellence in deploying new technologies, transforming processes and expanding product capabilities in eCommerce, Wealth Management and Financial Markets that will best meet the needs of the next wealthy generation in the GBA. About Standard Chartered GBA Centre Standard Chartered GBA Centre, as one of the key actions of Standard Chartered group’s strategy of investing and developing GBA, was a project invested by Standard Chartered Bank and Standard Chartered Bank (Hongkong) Limited in August 2020. The project is to rent and build up 7 floors offices at Guangzhou International Commercial Centre (ICC), which will be an office location to host multiple legal entities, branches of the Standard Chartered Group. At present, Standard Chartered Global Business Services (Guangzhou) Co., Ltd and Standard Chartered (Guangzhou) Business Management Co., Ltd have operated at ICC. These two legal entities will provide global back-office operation services, technology solutions and innovation services to Standard Chartered group and hold ICC property usage and provide property services respectively. In the future, other Standard Chartered legal entities and branches’ move-in is under plan and preparation.

STANDARD CHARTERED HONG KONG IS WELL-POSITIONED TO PROVIDE FURTHER DIVERSITY OF WEALTH MANAGEMENT SOLUTIONS FOR ITS GBA MAINLAND CLIENTS TO SEIZE THE OFFSHORE INVESTMENT OPPORTUNITIES

HONG KONG BUSINESS | Q2 2022

INFANT AND CHILD NUTRITION

Turning Challenges into Opportunities with a Cross-Border Omnichannel Strategy Mead Johnson Nutrition Hong Kong wins consumer trust and fuels sales performance in the Greater Bay Area amidst the pandemic.

Mr Pankaj Agarwal, General Manager, Hong Kong, Taiwan & Cross Border, Mead Johnson Nutrition (Hong Kong) Limited

he onset of coronavirus has brought unprecedented challenges to businesses around the world. It has disrupted not just traditional ways of working and doing business, but also tested the resilience, flexibility and responsiveness of companies, large and small alike. Acknowledging that consumers are changing the way they interact with brands in the pandemic era, Mead Johnson Nutrition Hong Kong (MJNHK) quickly adopted a new omnichannel strategy for the launch of its Enfa A+ NeuroPro upgraded formula in the Greater Bay Area (GBA). This cross-border consumer engagement campaign not only earned MJNHK an industry award but also helped the company enhance product awareness, foster consumer trust and drive product sales. “The infant and child nutrition industry has been heavily impacted by the outbreak of COVID-19, especially for companies operating a cross-border business like us,” said Mr Pankaj Agarwal, General Manager, Hong Kong, Taiwan & Cross Border, Mead Johnson Nutrition (Hong Kong) Limited. “But the massive disruption has also inspired us to rethink how we run our business, manage our operations and engage consumers. Ironically, it has provided us with a perfect opportunity to do things in a more innovative way, which has actually benefited our consumers.” Winning strategy in the Greater Bay Area With a mission of nourishing children’s best start in life, MJNHK is committed to providing safe, high quality and innovative products that help meet the nutritional needs of infants and children. The recently launched upgraded Enfa A+ NeuroPro is the very first infant 34

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formula in the market to combine MFGM (Milk Fat Globule Membrane) and Human Milk Oligosaccharides (HMO) to support children’s brain development and foster their golden immunity. Addressing the shift in consumers’ access to information and buying behaviour, the MJNHK team deployed an integrated online and offline strategy to promote its upgraded product line in the GBA. Key to the success of the campaign was establishing close partnerships with leading e-commerce platforms including Tmall, JD, Kaola, VIP, Yunji and O’Mall, as well as popular offline consumer touchpoints, especially brickand-mortar mother and baby stores operating in various free-trade zones in southern China. The effective use of omnichannel made it easier for consumers in the region to access product information and make purchases. In addition, the product was featured in the Children Baby Maternity Expo China, the world’s largest trade fair for child, baby, maternity products and services, creating a highly visible and effective platform for MJNHK to connect with consumers.

sense of emotional intimacy with them. By partnering with healthcare experts, MJNHK empowered parents with essential nutrition and parenting knowledge spanning across child development, prenatal and postnatal nutrition, physical wellness of newborns, and even the mental wellness of parents. The company’s modified communications efforts also helped deepen consumer confidence and drive positive word-of-mouth endorsements for the upgraded formula on key social media channels such as WeChat, Xiaohungshu, Tik-Tok, and many more vertical portals. The Enfa A+ NeuroPro upgraded formula launch campaign was recognised at the recent Hong Kong Business Greater Bay Area Enterprise Awards where MJNHK was the only company awarded in the Infant and Child Nutrition category. “We are proud to receive this award as it showcases our team’s agility and responsiveness in difficult and uncertain business situations. Grounded in a century of nutritional science, we will continue to provide best-in-class nutrition products and drive the development of this product category across the GBA cities,” Mr Agarwal concluded.

Create emotional bonding with parents Dedicated to supporting parents in every stage of their childcare journey, the launch of the Enfa A+ NeuroPro upgraded formula went far beyond traditional product sales practices, by directly engaging 410,000 consumers through different touchpoints and communication channels to create a greater

GROUNDED IN A CENTURY OF NUTRITIONAL SCIENCE, WE WILL CONTINUE TO PROVIDE BEST-IN-CLASS NUTRITION PRODUCTS AND DRIVE THE DEVELOPMENT OF THIS PRODUCT CATEGORY ACROSS THE GBA CITIES

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EVENT: MADE IN & DESIGNED IN HK

HKB lauds top companies in Made in Hong Kong and Designed in Hong Kong Awards As customers need change, demand for more innovative products and solutions also increased. Manufacturers that had previously laid out plans were driven to expedite production to keep serving consumers and stay competitive. Hong Kong Business is proud to recognise these remarkable organisations that proved to be an industry game-changer with their trailblazing products at the Made and Designed in Hong Kong Awards. The Made in Hong Kong Awards is an initiative hailing innovative products across industries that are manufactured in Hong Kong whilst the Designed in Hong Kong Awards lauds products that are conceptualised by a Hong Kong-based office but manufactured outside the territory.

The trophies were presented to the winning organisations via digital ceremonies from the first to the second week of December 2021. Companies also had the opportunity to share their thoughts on winning in the prestigious awards programme through virtual interviews. Industry leaders were invited to judge the entries and select winners. The judges’ panel was comprised of Falcon Chan, Partner, Strategy, Analytics & M&A at Deloitte China; Michael Cheng, Asia Pacific, Mainland China and Hong Kong Consumer Markets Leader at PwC; Ryan Swann, Director, Audit & Assurance at Baker Tilly; and David Chu, Senior Advisor at ShineWing Hong Kong.

Made in Hong Kong Awards Construction Technology Infotronic Technology Limited Housewares Cathay Pacific Airways Limited Medical 10A Limited

Designed in Hong Kong Awards Beverage Cathay Pacific Airways Limited Electrical CGA (H.K.) Limited Electronics iH&S Technology Limited

10A Limited

Plastics & Rubber PAK NGAI CHEUNG INDUSTRY CO., LIMITED Textile Zamira Fashion Limited Toys and Novelties Shift Innovations Ltd

Zamira Fashion Limited 36

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10A Limited’s surgical respirator wins at Made in Hong Kong Awards These respirators harness the power of in-house nano-ﬁber fabric material with superb antiviral properties.

midst the severe outbreak of Omicron cases in Hong Kong, the government and infectious disease experts are encouraging medical workers to wear N95 due to its protective properties. N95 can filter >95% of airborne biological particles such as bacteria and viruses. N95 respirators reduce the wearer’s exposure to airborne particulate hazards. However, standard N95 respirators are intended for industrial use only. There is a special subtype of N95 respirators that provide additional protection against hazards present during medical procedure, such as blood splatter. This is the Surgical N95 Respirator. The key difference between a Standard N95 Respirator and a Surgical N95 Respirator is fluid resistance. Standard N95 is not for hospital or clinic use by medical practitioners. Surgical N95 is the proper respirator for healthcare workers who need respiratory protection while in surgery, while working in a sterile environment or who may be exposed to high velocity streams of bodily fluids. Surgical N95 or its equivalent is dual certified – EN14683 Type IIR + EN 149 FFP2. This same type of masks is recommended by WHO (World Health Organization) as one of the approved respirators/masks against Covid-19. - EN 14683 is a standard that medical face masks in Europe are required to comply with. The testing requirements for this standard include bacterial filtration efficiency, differential pressure (breathability), splash resistance and microbial cleanliness. Type IIR means the bacterial filtering effectiveness (BFE) is >98% and the mask is splash resistant.

- EN 149 is a European standard of testing and marking requirements for filtering half masks. EN 149 FFP2 masks have similar performance requirements to N95 masks in the United States. There has always been a compromise between protection and comfort/ breathability. It is difficult to breathe when you wear more protective masks precisely because there are 4 layers to help achieve the protection level needed. They must also fit snugly against the face and not have any gaps. The thick layers and the lack of air gaps make it very difficult to breathe when wearing N95 type masks. What if there is a mask that surpasses the N95 standard in terms of protection but gives is very comfortable to wear and you can breathe easier? There is indeed A NEW GENERATION OF SURGICAL RESPIRATORS that comply with the WHO Recommended Respirators against COVID-19. 10A achieved this balance of eXtreme protection and comfort using it’s very own filters powered by 10AGO’s eXtreme protective comfort technology. We boast of: - 10A Bacterial Filtration Efficiency - BFE >99.9% and PFE>99% o versus N95 - BFE >95% o versus Surgical N95 - BFE >98%) - 10A breathing resistance (Inhalation) <=1 mbar(@30L/min) & <=1.6 mbar(@95L/min) o versus N95 standard inhalation resistance <=3.43mbar (@85L/min) – Imagine this is more than twice (mbar) of pressure resistance on your lungs to inhale.

10A HAS SURPASSED THE STANDARD FOR EACH PARAMETER OF WHO-RECOMMENDED DUAL-CERTIFIED SURGICAL RESPIRATORS 38

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o versus EN 149 FFP2 standard <=0.7 mbar (@30L/min) ; <=2.4mbar (@95L/min) - 10A breathing resistance (Exhalation) <=2.1mbar (@160L/min) o versus N95 and Surgical N95 standard exhalation resistance <=245Pa (@85L/min) o versus EN 149 FFP2 standard <=3.0mbar (@160L/min) - 10A passed Fit Test with <5% total inward leakage and only 0.56% of CO2 inhalation o Fit test is required for EN149 FFP2 but not for N95 and Surgical N95 o versus EN 149 FFP2 standard total inward leak age <=8%; <=1% CO2 inhalation - 10A passed ISO 22609 synthetic blood penetration fluid resistant – surgical with 120mmHg/16Ka rating (32/32 masks passed) o Standard N95 and EN 149 FFP2 are not required to pass ISO 22609 o versus Surgical N95 and EN14683 Type IIR – 120mmHg/16KPa (29/32 masks passed) - 10A passed ISO 10993 Biocompatibility with only 6.4 – 20 cfu/g o Standard N95 and EN 149 FFP2 are not required to pass ISO 10993 with <=30cfu/g o Surgical N95 and EN 14683 passed ISO 10993 - Only the 10A filter layer is antiviral (ISO 18184) and antibacterial (ISO 20743) with over 99% antiviral and antibacterial efficiency 10A surpassed the standard for each parameter of WHO recommended dual-certified surgical respirators. It exceeds and outperforms all standard requirements of KN95, ASTM F2100, N95 and Surgical N95. 10A Lotus received the HKB Made in Hong Kong Awards 2021 - Award for Manufacturing Excellence for the Medical Category.

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IG N ED

HO NG KO NG 1

TEXTILE

A W

R D S

Caring for the Future of Fashion – Zamira leads in the supply chain of sustainable denim Promoting sustainability innovation and solutions under its Zamira Cares umbrella

stablished in 2007 as a fashion and product-led supplier, Zamira has more than 15 years of experience in the denim and jeanswear business. Over the years Zamira has progressed into a multicountry operation .with its headquarters in Hong Kong, its denim lab and smart development centre in Southern China and its main sourcing and production office in Bangladesh. Zamira’s vision is to bring about changes in the denim industry so as to pave the way forward for the most ethical, sustainable and eco-efficient supply chain. Its mission is to provide clients with outstanding services, innovative designs and ensure ethical, sustainable and transparent sourcing solutions for their denim products. Since 2016, Zamira has placed its core emphasis on sustainability, fuelled by a strong belief that the denim world needs to change has given them the courage to invest in new technology and people to manifest their vision. Zamira is an early member of The Jeans Redesign by the Ellen MacArthur Foundation and is considered one of the leading sustainable companies in the denim supply chain. Zamira’s commitment to the path of sustainability has truly enabled it to be at the forefront of sustainability innovations. Under Zamira Cares, the company constantly introduces sustainability initiatives in all facets of the denim supply chain: fabrics and materials, chemical management, safe-towear products, traceability, cutting-edge technology with eco-efficient finishing, longevity and circularity of products and lastly, carbon emissions and energy management of its facilities across the globe. Circularity and longevity are highly focused factors under the Zamira Cares’ umbrella initiatives. A big challenge for many clothing brands today is ensuring sustainability as they manufacture their products. For Zamira, sustainability is more than a trend or a marketing tool. Zamira is committed to continuously finding new ways to develop greener products. Their biodegradable jean is the greenest product Zamira has developed so far. Zamira developed and manufactured it in consideration of ‘made to last, built to

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Zamira’s award winning biodegradable jeans

disappear’ for its trims all the way to the finishing. Zamira’s design and fabric team have specially developed an organic cotton and hemp mixed fabric and sourced special and sustainable trims such as shell derived corozo buttons and Tencel threads for all its stitching. Ensuring zero polyester labelling on the inside, the biodegradable jean has its care label information marked with laser on the inner pocket lining made of 100% organic cotton. And finally, a plantable seed hangtag is attached, allowing consumers to plant it at home without needing it to be recycled or thrown away. As part of Zamira’s 2020 goals, the company is amongst the first to have successfully eliminated the use of conventional potassium permanganate spray from its entire development and production. The biodegradable jean is washed

sustainably with eco-efficient machinery, certified chemicals and no potassium permanganate. Going forward with their digitalisation journey, in mid 2019 Zamira had recognised that a big shift from traditional to digital product creation is inevitable and has embraced 3D technology to create a more sustainable and efficient workflow within the company. Zamira has put big efforts and resources to bolster its expertise of how to digitise, visualise and simulate denim which is one of the more complex product categories. Together with their customers, Zamira has already run several successful 3D pilot projects from design to fit and has gone into the adoption phase for bulk. Using 3D technology within their workflow throughout the design and fit process has allowed Zamira to reduce the amount of sampling and also reduce the lead time it can offer in production. This process took some time to build confidence from both the supplier and customer’s side and requires a lot of patience throughout. But this is key for any company wanting to stay relevant and be at the front with the latest technologies. Zamira is proud to be recognised as a world leader in sustainability. However, for Zamira there is no time to rest as its pursuit for new, greener and better solutions is a constant process.

Zamira’s successful 3D development pilot projects

A BIG CHALLENGE FOR MANY CLOTHING BRANDS TODAY IS ENSURING SUSTAINABILITY AS THEY MANUFACTURE THEIR PRODUCTS. FOR ZAMIRA, SUSTAINABILITY IS MORE THAN A TREND OR A MARKETING TOOL. ZAMIRA IS COMMITTED TO CONTINUOUSLY FINDING NEW WAYS TO DEVELOP GREENER PRODUCTS

HONG KONG BUSINESS | Q2 2022

EVENT: ASIAN EXPORT AWARDS

2021

Get to know the winners of the 4th Asian Export Awards

ith the supply chain disruptions and logistical problems due to the current crisis, companies who were able to keep trade flowing and make sure that their products would reach their consumers regardless of distance are the ones who thrive amidst the crisis. These companies that have provided excellent products or services were hailed at the recently concluded Asian Export Awards 2021. Now in its fourth year, the awards programme honoured products and services that have significantly enhanced business in the regional export scene. The event is divided into two categories, Large Corporate for companies with a group turnover of over US$300m and Local Champion for small and medium enterprises (SMEs) with a turnover

of less than US$300m. The awards were handed to the winners via digital presentations during the first and second week of December. Winning companies were also interviewed virtually to share their thoughts on winning in the prestigious event. This year’s nominations were judged by an elite panel of judges consisting of Asta Nie, Worldtrade Management Services Leader, China at PwC Asia Pacific Customs and Trade; Jeremy Huang, Director, Corporate Finance at Deloitte; Chong Cheng Yuan, Partner at RSM Singapore; Josephine Hong, Executive Director, Corporate Advisory at BDO Singapore; and Toh Kim Teck, Partner at Foo Kon Tan.

ASIAN EXPORT AWARDS Large Corporate Division C.P. Merchandising Co., Ltd • Export Initiative of the Year - Food • Product Exporter of the Year - Food CP Merchandising introduced a new packaging solution for its C.P. brand black bag range that reduces the use of paper and also has the same strength to hold the product. The new packaging is a good solution for its wholesale customers that need to be able to use the shelf display package. Its Meat Zero product line was also recognised in the awards programme for its quality, catering to those who love the taste of meat but want to minimise the environmental impact of the meat they consume. Meat Zero looks, cooks, and tastes like meat but is made from plants, and it is also claimed to be good for the health. Local Champion SOLEX INTERNATIONAL (THAILAND) CO., LTD.

C.P. Merchandising Co., Ltd

• Product Exporter of the Year - Security & Safety Solex International won the Product Exporter of the Year - Security & Safety award under the Local Champion division in the recently concluded Asian Export Awards 2021 for two of its latest offerings: the Key Alike and Master Key System, and its innovative Padlock Bar for Roller Shutters. The Key Alike and Master Key System introduce a mechanism that requires only one code to enable one key to open all locks. Each lock has a different code key that cannot open others, but the master key of the group can open all locks. Its second offering was created to minimise weak points they have identified in roller shutters. The weak point of the roller shutter is the thin padlock bar which can be easily cut by thieves. Jiangsu Konsung Bio-Medical Science & Technology Co., Ltd. • Product Exporter of the Year - Healthcare • Product Exporter of the Year - Medical Jiangsu Konsung Medical Information Technology Co., Ltd recently launched products, such as COVID-19 test kits, to help alleviate testing concerns during the pandemic. The company integrates R&D, manufacturing, sales and provides dozens of products that are also exported to various countries and regions such as Asia, America, Africa, and others. Konsung also takes pride in its In Vitro Diagnostic equipment and has also launched a wide range of Point-of-care Testing diagnostic products, a medical diagnostic test performed using a small amount of specimen which takes place at or near the site of patients. 42

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SOLEX INTERNATIONAL (THAILAND) CO., LTD.

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EXPORT INITIATIVE OF THE YEAR - FOOD PRODUCT EXPORTER OF THE YEAR - FOOD

2021

C.P. Merchandising recognised with two wins at The Asian Export Awards Its Meat Zero product line was highlighted.

eading the way to sustainability is a key part of C.P. Merchandising Co., Ltd.’s business philosophy over the decade not only in the business operation, raw material, and ingredients but also in packaging aspects. The company received two major awards in the recently concluded Asian Export Awards, an annual awards programme that recognises top exporters in the region. The awards are Export Initiative of the Year – Food under the Large Corporate division and the Product Exporter of the Year – Food under the Large Corporate division for its Meat Zero product line. Mr Anat Jurintron, Managing Director of C.P.Merchandising said these recognitions are reflective of the company’s strong professional management as a responsible food producer focusing on food safety and environmentally friendly products that adhere to global standards. The first award that C.P. Merchandising received is the Export Initiative of the Year – Food under the Large Corporate division for its efforts in the C.P. Packing Innovation project. The company introduced a new packaging solution for its C.P. brand black bag range that reduces the use of paper44% and also has the better strength to hold the product. The new packaging is not only reducing paper waste but also a good solution for our wholesale customers and consumers. The new displayed carton design was found more convenient to tear off for the staff compared to the old style that is comprised of 2 pieces of paper which lead to efficiency at operation whereas the new design on side of the design is also attractive for consumers and distinctive on the shelf. The company started sustainable packaging in 2020 with the product Flamin’ chicken tenders as a trial. After the successful result, they roll out the new packaging across the range of four SKUs in 2021. The company expects to export more than 200,000 cartons this year and with this new innovative packaging, C.P. Merchandising proudly expects to save over 170 trees. Meanwhile, the second award received by the company is Product Exporter of the 44

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After around two years of developing the product, C.P. Merchandising successfully launched Meat Zero in Thailand in May 2021. The brand enjoys success in its home country. Over 4 million packs were sold in Thailand since its launch in May and is now rolling out its expansion plan, exporting to Asia, the USA, the UK, and the EU. The company is currently listing its Meat Zero products in key retailers, online channels and foodservice channels starting with Hong Kong and Singapore in November 2021. The company plans to export to Korea, Japan, China and other Asian countries this year. The brand aims to become the no.1 plant-based brand in Asia within 3 years. The C.P. brand aims to bring the most genuine regional Asian cuisines possible, with the convenience of frozen prepared meals.

Mr Anat Jurintron, Managing Director of C.P. Merchandising

Year – Food under the Large Corporate division for its Meat Zero product line. “Meat Zero is a new plant-based product catered to those who love the taste of meat but want to minimise the environmental impact of the meat they consume. Meat Zero plants and manufactured to feel, taste, and appear like real meat thanks to our ‘PLANT-TEC’ innovation, making it a healthy option with high protein and 0% cholesterol. The product ranges from chicken nuggets, patties, and various ready meal menus,” said Mr Anat.

Flamin’ Chicken Tenders

THE C.P. BRAND AIMS TO BRING THE MOST GENUINE REGIONAL ASIAN CUISINES POSSIBLE, WITH THE CONVENIENCE OF FROZEN PREPARED MEALS

Meat Zero

HONG KONG BUSINESS | Q2 2022

OPINION

PATRICK CHAN

Cryptocurrency in Hong Kong – why regulation and enforcement are needed

PATRICK CHAN Partner, Charles Russell Speechlys

Hong Kong is likely to continue to be a significant market for cryptocurrency, given its status as a global financial hub

ith the second-highest engagement after the United States, Hong Kong continues to be a significant market for cryptocurrency. Last month the financial services industry breathed a sigh of relief when the Hong Kong Securities and Futures Commission and the Hong Kong Monetary Authority issued a joint circular which gave them the green light to do crypto business. The new guidance essentially allows banks and brokers to offer digital-asset trading services to professional investors. However, it is important to note that the circular did not address the fate of retail customers. Up until now, cryptocurrency has largely been regulated by existing AML and KYC rules. The Legislative Council is expected to pass legislation later this year in relation to retail investors, but at present, there is no specific legislation relating to cryptocurrency in Hong Kong. Why is regulation and enforcement needed? The murky world of money laundering and cryptocurrency has recently made the headlines with the US Department of Justice charging a married couple for allegedly laundering US$4.5 billion worth of stolen Bitcoins. This represents the biggest theft in US history and the largest seizure by authorities. Money laundering has also made the headlines in Hong Kong, with the first reported money laundering case involving cryptocurrency in July last year. At the time, Hong Kong Customs arrested four individuals in relation to a suspected moneylaundering syndicate involving $2.2 billion through a virtual currency exchange trading platform. The need for regulation and enforcement is clear but given the constantly evolving nature of cryptoassets it is difficult to predict exactly how this will evolve in the short term. The United States Federal Bureau of Investigation (FBI) recently announced the establishment of a new unit to stop cybercriminals that abuse digital currencies. Many are now wondering to what extent Hong Kong

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will also develop its enforcement and regulation. How are the courts approaching cryptocurrency? In Yan Yu Ying v Leong Wing Hei [2021] HKCFI 3160 the court granted a temporary proprietary injunction over 999.9900261 Bitcoins worth $328,363,760. In this case the Plaintiff alleged that the Defendant had misappropriated the Bitcoin, an allegation denied by the Defendant. This case shows how the courts may apply their discretion when granting interim-interim injunctions in cryptocurrency disputes in Hong Kong and their willingness to treat Bitcoin as a form of property. Similarly, the English High Court has held that cryptoassets can be treated as property and as such the owner of cryptoassets can avail themselves of the proprietary remedies that a court is able to grant (AA v Persons Unknown [2019] EWHC 3556). However, it is important to exercise caution when considering judgements involving cryptocurrency disputes due to the highly factsensitive nature of judgements and the diverse and fast-evolving nature of cryptoassets. With more judgements related to cryptocurrency expected in the future, legal commentators and investors alike will be closely watching to see how the law develops in this area. Summary For some time, there has been a great deal of uncertainty in Hong Kong surrounding cryptocurrency and what regulation might be forthcoming. Whilst the recent circular by the Hong Kong Securities and Futures Commission and the Hong Kong Monetary Authority is welcome news by many, it still leaves questions unanswered, particularly in relation to retail investment. Hong Kong is likely to continue to be a significant market for cryptocurrency, particularly given its status as a global financial hub, but much will depend on future regulatory changes and what approach other jurisdictions take. For now, it’s a case of watching the cryptocurrency and cryptoassets space.

iPhone 13/ Pro/ Pro Max Protective Case

65W GaN USB Charger

UVC LED Sterilizer Box with Wireless Charging

Superlative Anti-Bacterial Cable

Elite Go 21T True Wireless Earphones

DIREACH_HK

DIREACH was founded in Hong Kong in 2020 with the core value of “Premium Product. Premium Brand.” The brand specialises in mobile digital product accessories, including audio accessories, power banks, chargers, charging cables and UV disinfection boxes. DIREACH has been awarded the “e-brand awards” by e-zone in 2020 and 2021; the “Most Innovative Enterprise Award 2020” by Business Innovator, the Asian business creative content platform; and “The Excellence Brand Award 2021” by PCCW and Yellow Pages.

HONG KONG BUSINESS | Q2 2022

OPINION

JACKY CHENG

The top architectural trends to watch out for in Asia in 2022

aving lived in the age of COVID-19, architecture and planning industry professionals need to become aware of how lockdown and quarantine conditions have changed the way society lives, works, and interacts. Here we look at the next top three trends within the Asia Pacific region that will shape the future of everyday living and examine how developing urban places like Hong Kong, Singapore, Seoul, Vietnam, and Malaysia have adopted these trends. 1. Better architecture and urban design are key to improving people’s well-being Placemaking is not a new urban design concept that arose from the pandemic, but rather a well-established architectural trend known to put the human experience first. The pandemic acted more as a catalyst for the concept’s usage. As pioneers in placemaking, we have seen the concept gain momentum in the industry over the past 44 years and noted its gradual development amongst Asian countries. Placemaking has only become more prominent in Asia after living with lockdowns, especially in densely populated cosmopolitan cities like Singapore and Hong Kong, where people are pursuing bigger changes in living and working environments. Spending long periods of confinement at home has no doubt put pressure on our mental health. In Singapore, 1 in 3 adults is experiencing psychological distress related to COVID-19, as a 2021 study from Duke and NUS found. However, the distress is heightened by the design of certain living spaces and their impact on public health, presenting a physical challenge in preventing the transmission of COVID-19 if residents desire to leave their houses. To tackle these challenges, cities must prioritise the need for ample public spaces in a contemporary urban environment whilst keeping green elements visible and accessible in all spaces, including homes. This will ensure a well-rounded urban development that is healthy, safe, and sustainable. As cities are catching up in sustainable development, companies are also expected to up their game in office environment options when returning to the workplace. The future of work has evolved as many people want to keep the level of flexibility they gained during the pandemic. To attract and retain talent, companies must remain adaptable to support people with different workplace preferences. Besides providing an agile workplace, companies should offer a dynamic work environment to gain a competitive advantage. 2. The rising redevelopment and reviving of local communities for human connection Whilst placemaking comes in as a dominant trend, cities, especially those with rich cultural history, must also strike a balance between revitalisation and conservation when redeveloping old towns. Urban regeneration is inevitable to every city, but of utmost importance is staying true to a city’s unique culture when reviving local communities. Taking Seoul as an example, the city underwent the Cheonggyecheon restoration project, revitalising the Cheonggyecheon Stream that had

HONG KONG BUSINESS | Q2 2022

JACKY CHENG VICE PRESIDENT/DIRECTOR OF PROJECT DEVELOPMENT, ASIA PACIFIC

previously been covered by a highway overpass and unleashing the potential for green public space. Located in the old downtown area of Seoul, the project was once seen as too ambitious and beyond the imagination or capacity of the local government. However, after seeing the project’s thoughtful preservation of the unique natural environment and the historic resources in the central business district of Seoul, the city now celebrates the project and how it symbolises gathering, harmony, peace, and unity. After the restoration of Cheonggyecheon, the downtown area has been given a new life with a variety of uses and increased land values by about 25-50%, whilst pedestrians now have a vibrant, green public space to enjoy. In places like Hong Kong, we are also seeing a rising trend in revitalising individual landmarks and sites for cultural preservation which the public has taken more interest in. Recent conservation projects include the former Central Police Station, now known as Tai Kwun – Centre for Heritage and Arts, and the Central Market, which are both presented as ‘new community spaces’ to support local arts and cultural engagement, and which emphasise the human and architectural link of the past and future. Together with the impact of the pandemic and the drive of placemaking, we definitely expect to see more ‘human-centric’ redevelopment projects in the future. 3. The growing prominence of green architecture As mentioned earlier, urban development is becoming increasingly guided by sustainable planning and designs, leading green architecture to be the next big trend to watch. As of end-2020, over 4,000 building projects in Singapore have been ‘greened’ (meaning they have met Singapore’s BCA Green Mark standards), covering 43% of the total gross floor area of Singapore’s building stock. As developers and investors recognise that robust ESG practices are a core performance consideration, we anticipate seeing further reinforcement of these practices as Environmental, Social, and Governance (ESG) investments gain global popularity. Developing APAC countries such as Malaysia and Vietnam are notably placing a stronger focus on green architecture to capture foreign investments when developing a sustainably built community. Green assessment tools such as Leadership in Energy and Environmental Design (LEED) and BCA Green Mark that evaluate buildings for their environmental impact and performance will become even more widely adopted. As of September 2020, Vietnam is already seeing 83 LEED-certified projects, and we expect the number to grow even larger according to our firsthand experience. The integration of green spaces into designs will take over architecture in the long run, from rooftops, terraces, and parks to indoor foliage. Whilst 2021 was largely understood as the year of the ‘new normal, these shifting trends have shaped an even newer environment for architecture and wellbeing, reminding industry leaders to be resilient and adaptable when redesigning the concept of living places of the future.

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Hong Kong Business (April - June 2022)

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