U.S.-based asset manager Hermes is the latest major investor of HSBC to publicly voice concerns over the bank's support for the controversial national security law in Hong Kong.
«We are engaging with HSBC to fully understand its position on the Chinese national security law for Hong Kong,» said Roland Boschs, Hermes’ lead for corporate engagement with financial service providers, first reported over the weekend on «The Mail».
Federated Hermes has a long history of focus on environmental, social and governance (ESG) issues including active screening for allegations of human rights violations as part of its investment process. Hermes, which has over $1 trillion worldwide in assets under advice, acts on behalf of institutional investors regarding these issues through a stewardship service unit it calls «EOS».
Human Rights
According to Boschs, the main concern Hermes has with regards to HSBC’s support for new legislation is the potential for negative effects to human rights. Although details revealed indicate that the law will target acts of secession, subversion, terrorism or collusion with foreign forces, many have voiced concerns about how widely encompassing the definitions could be and the consequent impact.
«We have questions on the bank’s statement amid concerns that the new law may have an adverse impact on human rights in Hong Kong,» Bosch added. «We expect companies to support improvements in protections for citizens and not back their removal.»
Federated Hermes becomes the second major investor of HSBC to publicly comment on the British lender’s stance on the controversial law. Earlier this month, Aviva Investors’ equity chief investment officer David Cumming also said the firm was «uneasy» with HSBC and Standard Chartered’s public support for the law, adding that «if companies make political statements, they must accept the corporate responsibilities that follow».
