Corporate Governance with Chinese Characteristics - a new article accepted for publication in The China Quarterly

Kasper Ingeman Beck and Kjeld Erik Brødsgaard have contributed an article to The China Quarterly analyzing the historical and recent development of Chinese Communist Party (CCP) organization in state-owned enterprises (SOE) as well as the implications for corporate governance.

Relying on official documents, secondary works, and interviews with enterprise managers, government officials, and academics, the article documents how the CCP has actively formalized its role in Chinese business by embedding itself into the corporate governance structure of state-owned enterprises. Through the application of Chinese indigenous administrative corporate governance concepts such as “bidirectional entry, cross appointment” and “three majors, one big”, the CCP has consolidated its dominance of enterprise decision-making procedures and personnel appointment by creating a hybrid Party-led model of corporate governance. While this hybrid model can secure enterprise compliance, communication with higher state and Party organs, as well as long-term development planning, it is unlikely to help solve SOE efficiency problems and might undermine other SOE reforms, such as efforts toward mixed ownership.

The article is a revised part of Kasper Ingeman Beck's PhD project on Chinese SOE reform and corporate governance.