HSBC Holdings plc Notice of Annual General Meeting at 11.00am on Friday, 22 April 2016 Queen Elizabeth II Conference Centre Broad Sanctuary, London SW1P 3EE THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to any aspect of the proposals referred to in this document or as to the action you should take, you should consult a stockbroker, solicitor, accountant or other appropriate independent professional adviser. If you have sold or transferred all your shares in HSBC Holdings plc (the “Company”) you should at once forward this document and all accompanying documents to the stockbroker, bank or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee. Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this document, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this document. The ordinary shares of the Company trade under stock code 5 on The Stock Exchange of Hong Kong Limited. A Chinese translation of this Notice of Annual General Meeting is available at www.hsbc.com. Alternatively, the Chinese translation of this and future documents may be obtained by contacting the Company’s registrar (see page 25). 2016 4 22 Queen Elizabeth II Conference Centre Broad Sanctuary, London SW1P 3EE www.hsbc.com Computershare Investor Services PLC The Pavilions, Bridgwater Road, Bristol, BS99 6ZZ, United Kingdom www.investorcentre.co.uk/contactus 183 17 1712–1716 [email protected] Investor Relations Team, HSBC Bank Bermuda Limited, 6 Front Street, Hamilton HM 11, Bermuda [email protected] 25 +1 800 555 2470 Proxy Services, 200 A Executive Dr., Edgewood, New York 11717, USA Job No: 24853 Proof Event: 18 Park Communications Ltd Alpine Way London E6 6LA Customer: HSBC Project Title: Notice of AGM T: 0207 055 6500 F: 020 7055 6600 Contents 1. Chairman’s letter ����������������������������������������������������������������������������������������������������������������������������1 2. Notice of Annual General Meeting �������������������������������������������������������������������������������������������������6 3. Explanatory notes �������������������������������������������������������������������������������������������������������������������������10 4. Information about the 2016 Annual General Meeting �����������������������������������������������������������������21 5. General information ���������������������������������������������������������������������������������������������������������������������25 6. Appendices ����������������������������������������������������������������������������������������������������������������������������������� 26 7. How to send us a question you would like to have addressed at the Annual General Meeting ��������������������������������������������������������������������������������������������������������������� 31 Job No: 24853 Proof Event: 18 Park Communications Ltd Alpine Way London E6 6LA Customer: HSBC Project Title: Notice of AGM T: 0207 055 6500 F: 020 7055 6600 18 March 2016 Dear Shareholder I am pleased to invite you to the HSBC Holdings plc 2016 Annual General Meeting (“AGM”) starting at 11.00am on Friday, 22 April. Our AGM will again be held at the Queen Elizabeth II Conference Centre in central London. This is a venue which can be easily reached by public transport. We would like to welcome you in person at the meeting but if you are unable to attend, you may choose to watch the meeting via a webcast which you will be able to access through www.hsbc.com/agmwebcast. Notice of the AGM and particulars of the business to be considered are enclosed with this letter. We look forward to updating you on the Group’s progress over the past year and on our priorities for the next 12 months, as well as commenting on recent events. There are a number of important items of business at this year’s AGM and I recommend that you read the notice together with the attached explanatory notes. I would like to highlight the following items for you: Annual Report and Accounts The first items of business concern our Annual Report & Accounts for the year ended 31 December 2015 (“Annual Report & Accounts”) and the 2015 Directors’ Remuneration Report. You will see that the Strategic Report and Annual Report & Accounts look different from previous years. Our aim is to provide you with a clear and accessible overview of our performance in 2015 and how we aim to create long term, sustainable value for our shareholders. We hope that you like the changes we have made and would welcome your feedback. Remuneration policy In 2014, we were grateful for your endorsement of our remuneration policy, which was designed to be in force through to the AGM of 2017. The 2015 Directors’ Remuneration Report, which you will be invited to approve, comprises a report by the Group Remuneration Committee on its implementation of that remuneration policy during 2015, showing how much we paid our Directors and why. As we foreshadowed last year, new regulatory requirements now necessitate revisions to our remuneration policy. Accordingly, at this year’s AGM, as set out in the Directors’ Remuneration Report on page 285 of the Annual Report & Accounts, the Group Remuneration Committee is recommending changes to this policy to reflect new regulatory developments regarding remuneration for Directors. Directors We have made further changes to the Board this year to take into account the retirement of some of your longest serving Directors and to add directors with complementary skills and experience. After nearly eight years on the Board, Safra Catz retired at the end of 2015. Your two longest serving non-executive Directors, Rona Fairhead and Sir Simon Robertson will retire at the conclusion of this AGM. Each of them made important contributions to the Group, not least during the global financial crisis, for which the Board is extremely grateful. Their aggregate expertise and experience have been invaluable to HSBC and they will be sorely missed. HSBC Holdings plc Incorporated in England with limited liability. Registered in England: number 617987 Registered Office and Group Head Office: 8 Canada Square, London E14 5HQ, United Kingdom 1 Job No: 24853 Proof Event: 18 Park Communications Ltd Alpine Way London E6 6LA Customer: HSBC Project Title: Notice of AGM T: 0207 055 6500 F: 020 7055 6600 Since last year’s AGM, the Board has welcomed Irene Lee, Pauline van der Meer Mohr, Paul Walsh and Henri de Castries as non-executive Directors on 1 July 2015, 1 September 2015, 1 January 2016 and 1 March 2016 respectively. They stand for election for the first time at this year’s AGM. Your Board believes that these appointments bring substantial relevant experience and expertise to the Board and we are grateful for the contributions that they are already making. As is our normal practice, all other Directors will stand for re-election. The biographical details of each of the Directors can be found on pages 12 to 17. On behalf of the Board, I wholeheartedly recommend the election and re-election of the Directors not retiring at this meeting. As at the conclusion of this year’s AGM, subject to the re-election recommended above, your Board will comprise a full time Chairman, three executive Directors and 14 independent non-executive Directors, 12 of whom have been appointed in the last five years. The Nomination Committee has now turned its attention to formulating a succession plan for my own role as Group Chairman so that the incoming Group Chairman can lead the process for selecting the next Group Chief Executive in due course. This search process has now commenced and will be led by the Chairman of the Nomination Committee together with the Senior Independent non-executive Director. The Board aims to nominate my successor during 2017 but the exact timing is clearly dependent upon identifying and securing the appropriate candidate. My own commitment is to remain as long as necessary to ensure a smooth transition. External auditor PricewaterhouseCoopers LLP (“PwC”) was appointed as external auditor for the financial year beginning 1 January 2015. They have made a positive contribution in their new role. We are asking you to approve their re-appointment as auditor of the Company and to authorise the Group Audit Committee to determine their remuneration. Authority to allot shares and contingent convertible securities As in 2015, we will be seeking a general authority from you for the Directors to allot shares both on a pre-emptive and non-pre-emptive basis. We are asking for our existing authority to offer a scrip dividend alternative to be renewed for a further three-year period until 2019, in line with UK guidance. We also seek a renewal of shareholder authority to make market purchases of up to 10 per cent of our own shares. All of these resolutions satisfy stock exchange listing rules and relevant guidelines in both the UK and Hong Kong. Although we have no immediate plans to purchase ordinary shares, as we execute our strategy, it makes sense to constantly review the capital we hold. The authority to make market purchases, if approved by shareholders, will give us the flexibility to take action if we feel it is in the interests of the Company and our shareholders to do so. We remain committed to maintaining a strong capital base. In addition to the general allotment authorities referred to above, we will again seek shareholder approval for the Directors to create and issue contingent convertible securities that automatically convert into, or are exchanged for, ordinary shares in HSBC in prescribed circumstances. Our ability to issue these securities enables HSBC to manage its capital requirements in the most efficient and economical way for shareholders. Further details are set out on pages 19 and 20 and in Appendix 1. General meetings As in previous years, we will seek authority for general meetings (other than the annual general meetings) to be called by giving a minimum of 14 clear days’ notice.