Roland Bosch, Federated Hermes’ lead engager for financial services, said in a statement that the firm is engaging with HSBC to “understand their position” on the policy through its stewardship service.
“With the Chinese national security law for Hong Kong now passed, we remain concerned about the HSBC’s previous statements of support for it amid concerns that the new law may have an adverse impact on human rights in Hong Kong,” Bosch said in a statement. “We expect companies to support improvements in protections for citizens and not back their removal.”
HSBC, which is based in London and derives the bulk of its profit from China, has come under fire in recent weeks for taking a public stance in support of the policy. Facing mounting pressure from Chinese state-run media to make its view on the security law clear, the bank declared its support earlier this month. Standard Chartered, another British-based, Asia-focused bank, followed suit.
The law was unanimously passed Tuesday by the National People’s Congress, bypassing Hong Kong’s legislature, and will go into effect immediately, according to state-run media. While the law officially bans secession, subversion and colluding with foreign countries, it gives China broad new powers in the special administrative region and is considered by some a violation of Beijing’s agreement with the U.K. to grant the former British colony a level of autonomy.
Since coming out in favor of the measure, HSBC has been rebuked by a long list of Western officials and pro-Democracy activists in Hong Kong, as well as some shareholders. U.S. Secretary of State Mike Pompeo likened the move to a “political kowtow” and Aviva Investors, one of HSBC’s top shareholders, said it was made “uneasy” by the decision.
“If companies make political statements, they must accept the corporate responsibilities that follow. Consequently, we expect both companies to confirm that they will also speak out publicly if there are any future abuses of democratic freedoms connected to this law,” David Cumming, Aviva Investors’ chief information officer for equities, said in a statement earlier this month.