Back to Global Corporate Governance Trends for 2026
In July 2025, the Hong Kong Stock Exchange (HKEX) implemented significant revisions to the Corporate Governance Code and associated Listing Rules aimed at strengthening board effectiveness, independence, and diversity. Central to these reforms are tighter expectations around independent director tenure and overboarding, which will have direct implications for board composition in a market where HKEX requires at least one-third of the board to comprise independent non-executive directors (INEDs).
Under the revised regime, directors who have served more than nine years will no longer be considered independent following a defined transition period. While listed companies have until 2032 to implement these changes, boards are already beginning to respond. As our 2024 analysis highlighted, a meaningful proportion of Hong Kong boards—particularly among Hang Seng Index constituents—currently rely on long-tenured INEDs to meet independence thresholds. As these directors age out of independence, boards will need to proactively refresh their INED pipeline to avoid falling below the one-third requirement, placing greater pressure on succession planning, skills mapping, and the timing of appointments.
In addition to the new independence requirements, INEDs will be limited to a maximum of six concurrent public board appointments. While the overboarding cap is expected to cause less immediate disruption, it reinforces rising expectations around director capacity and engagement. Paired with the introduction of other board effectiveness recommendations—including the best practice of appointing a Lead INED, mandatory continuous professional development, and enhanced disclosures on risk management, internal controls, and dividend policy—these reforms elevate governance quality by forcing boards to think more deliberately about independence, effectiveness, and long-term composition rather than relying on legacy structures.
Against this backdrop of governance reform, boards of Hong Kong–listed companies are taking a more structured and forward-looking approach to board succession planning. Processes include sequencing INED transitions over multiple cycles, reassessing the mix of skills and experience required for future strategy, and (where appropriate) reconfiguring roles to preserve institutional knowledge while refreshing independence. Regular board performance reviews are now embedded more firmly in governance practice as well. In turn, these insights inform more structured discussions around succession readiness.
At the same time, heightened governance expectations are prompting boards to place greater emphasis on CEO and executive succession planning. While regulatory changes do not prescribe specific succession outcomes, the increased scrutiny has encouraged companies to formalize succession processes for senior leadership, aligning talent pipelines with long-term strategy and risk oversight.
After a year of rapid change in global and China’s AI landscape, boards in Hong Kong elevated generative AI and digital oversight as priority agenda items through 2025 and into 2026. While there is no regulatory mandate for AI expertise at the board level, a clear market consensus is emerging that effective AI governance starts with the board. Our recent AI roundtable in Hong Kong points to a shift from ad-hoc discussions to more structured oversight, with boards forming AI committees and seeking greater end-to-end visibility into AI deployment. In some cases, this has driven leadership realignment, including CIOs and CTOs reporting directly to the CEO. Meanwhile, boards are prioritizing director education to build baseline AI literacy and better understand strategic opportunities alongside ethical, operational, and cybersecurity risks. Strong IPO activity in AI-linked sectors is reinforcing this focus, heightening investor scrutiny and accelerating board engagement.
Hong Kong’s IPO market reached historic highs in 2025, reclaiming its position as the world’s leading venue for IPO fundraising. A defining feature of this resurgence has been the strong influx of Mainland Chinese companies seeking capital, visibility, and international credibility through a Hong Kong listing. This wave of listings, both first-time IPOs and “A+H” dual listings and frequently involving founder-led enterprises, is creating a substantial and immediate need to elevate governance standards. Founder-centric ownership structures, concentrated decision-making, and limited exposure to independent oversight are now being tested against Hong Kong’s regulatory framework and the expectations of global institutional investors.
For many of these companies, listing in Hong Kong represents not only access to capital, but also a first step toward global markets. Boards are therefore under pressure to professionalize rapidly—strengthening independence, formalizing succession planning, upgrading risk and compliance frameworks, and preparing leaders to engage with international shareholders and regulators. This evolution often extends beyond statutory boards to the introduction of international advisory boards, designed to inject global perspective, sector expertise, and governance maturity as companies expand overseas. In this sense, Hong Kong’s IPO boom is acting as a powerful catalyst: accelerating the transition of mainland enterprises from founder-led businesses into globally credible, institutionally governed companies.
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