We will carry out more thematic reviews of financial advisory firms’ consequence management frameworks to assure us that investor complaints are investigated in a fair and timely manner. 13 The reality of course, is that no amount of regulations nor supervision can prevent wrongdoings. To try to do so would require a large volume of pre-emptive rules as well as unlimited supervisory resources. Both situations are neither possible nor desirable. 14 This is why MAS also places importance on our enforcement actions. We will not hesitate to investigate and take errant financial institutions or their representatives to task for breaches of our law and regulations. We have issued prohibition orders against individuals for a range of misconduct, from mis-selling to dishonesty and fraud. Our message is clear— improper or illegal conduct have no place in our financial sector. Importance of market discipline 15 This brings me to the second topic. Market discipline. 16 As with our enforcement actions, market discipline can play an important role in shaping behaviour. It creates a strong incentive for financial institutions to conduct their business in a fair, transparent and responsive manner. A firm or its representatives with a poor record will deter prospective clients and investors. Similarly, investors will avoid companies that have poor standards of governance and disclosures. In other words, investors will penalise those that have fallen short, and reward those that have fared well. 17 To allow market discipline to work, different participants in the eco-system must play their part.

There are two categories of awards, both of which are open to Shenzhen and Hong Kong-based regulated financial institutions. The first is for the use of fintech, while the second is for cross-border financial innovation. It is a prestigious award and I would encourage Hong Kong financial institutions to take part and showcase their achievements. The Director-General of OFDS will share with us more details about this exciting competition in the next session. Soft-landing scheme 11. The second initiative is a mutual referral system for fintech firms – this is sometimes called “soft-landing”. Under this programme, the OFDS will provide support to Hong Kong fintech firms that want to establish a presence in Shenzhen, perhaps with a view to using it as a springboard to tap into the enormous market of Mainland China. 12. To better utilise this valuable opportunity, we are working with our strategic partner, Cyberport, on the establishment of cross-border soft-landing facilities in Shenzhen. Such an arrangement would give qualified Hong Kong fintech firms access to the business support from OFDS, which would be helpful for these firms to expand their business to the Mainland. At the same time, Cyberport will leverage on this platform in Shenzhen to assist Mainland fintech companies to establish operations in Hong Kong. 13. Given the geographical proximity between Hong Kong and Shenzhen, I have no doubt that this collaboration will further enhance Hong Kong’s role as the springboard to help homegrown and overseas firms reaching out to the Mainland market. Talent development programme 14.