CUHK
News Centre

Properly managing a financial portfolio is crucial to quality retirement life, especially in times of economic turmoil. Sun Hung Kai Properties (SHKP) and The Chinese University of Hong Kong (CUHK) presented a public lecture today (29 November) on Financing Retirement: Collective and Individual Approaches delivered by Professor William F. Sharpe, 1990 Nobel Laureate in Economic Sciences. The lecture attracted an audience of close to a thousand, including politicians, business people and CUHK staff, students and alumni.

SHKP Vice Chairman and Managing Director Raymond Kwok said, “Sun Hung Kai Properties strives to promote education and life-long learning in various ways, as part of our commitment to good corporate citizenship. We hope that these lectures will stimulate debate and intellectual enquiry, encouraging talented individuals to explore new innovations and building the human capital that Hong Kong needs to remain competitive in a globalized world. This is the second in a cluster of three lectures on economics that we are presenting this year, and this is certainly a timely subject given the financial turmoil and uncertainty sweeping the globe these days.”

CUHK Vice-Chancellor Professor Lawrence J. Lau thanked SHKP and Mr Kwok for their support over the last five years. He added, “Professor Sharpe is internationally known as one of the originators of the famous Capital Asset Pricing Model and creator of the Sharpe ratio for investment portfolio analysis. For his ground-breaking work in the theory of financial economics, he was awarded a Nobel Prize in 1990 with Professor Harry Markowitz and the late Professor Merton Miller. Professor Sharpe is a great theoretical innovator who has had tremendous success in translating economic theories into practical applications.”

As life expectancy increases around the world, it becomes more and more important to provide for retirees – those who no longer work full time. This requires procedures for transferring goods and services from workers, who produce more than they consume, to children and the elderly, who consume more than they produce. Typically this is accomplished with some combination of social contracts and financial contracts. In stable agrarian societies such transfers may be made within a family. In more industrialized societies with lifetime employment, governments and employers may both play major roles. But in many countries, urbanization and mobility have led to increased reliance on financial instruments and institutions, with each individual responsible in large part for financing a substantial portion of his or her retirement. To be effective, such systems require educated and responsible citizens as well as trusted and transparent financial instruments and institutions. Experience to date suggests that in most countries these requirements have been only partially met. During the lecture, Professor Sharpe addressed these issues and suggested ways in which societies might better allocate resources and risks among generations.

Professor Sharpe is the STANCO 25 Professor of Finance, Emeritus at Stanford University and past President of the American Finance Association. He is no stranger to Hong Kong; from 1999 to 2002, he was a Special Advisor to the Hong Kong Council of Advisors on Innovation and Technology.

The lecture was shown live at local universities and the Hong Kong Science & Technology Parks to reach a broader audience. It was also available on the Hong Kong Education City web site for online viewing, and there was a live feed to the Peking, Fudan, Shanghai Jiao Tong, Tsinghua, Zhejiang, Nanjing and Sun Yat-sen universities on the mainland.

SHKP and CUHK are marking the fifth year of the Nobel lectures by having three Economics Laureates address the current state of the global economy. The first was delivered by Professor Kenneth J. Arrow, 1972 Laureate entitled Economic Analysis and Social Obligation on 3 November. The last lecture The Dynamics of Societal Change: A New Approach will be delivered by Professor Douglass C. North, 1993 Laureate on 11 December, in the William MW Mong Engineering Building Lecture Theatre at CUHK. A limited number of free tickets will be set aside for the public and details of distribution will be announced soon.

The Sun Hung Kai Properties Nobel Laureates Distinguished Lectures were inaugurated in 2004 in conjunction with The Chinese University of Hong Kong. The series brings in Nobel Laureates to speak to a broad cross-section of the community and promote the discovery and the dissemination of knowledge, encouraging life-long learning and innovation. Including this, the fifteenth installment of the series, 22 Nobel Laureates or renowned scholars have lectured in Hong Kong.