As the deadline for the corporate system reform of central enterprises approaches, central enterprises are speeding up in completing the reform. According to the plan on the corporate system reform of central enterprises released by the General Office of the State Council in July, central enterprises shall complete the corporate system reform by the end of the year. Based on the data disclosed by the State-owned Assets Supervision and Administration Commission (SASAC), 69 central enterprises, 8 trillion yuan of headquarters assets and 3,200 subsidiaries under ownership by the whole people are involved in the reform.
The purposes of this round of reform are to establish an effective and balanced corporate system and governance structure, an effective simulative and restrictive mechanism and an efficient market-based operation mechanism, indicated Wu Qi, director of the commercial bank research center at the research institute of Hengfeng Bank. Through the corporate system reform, it will promote central enterprises to be independent market participants meeting the requirements on the socialist market economy and modern enterprise system and fully stimulate enterprise vitality to lay foundations for the establishment of the modern state-owned enterprise system with Chinese characteristics and the establishment of the board of directors and the mixed ownership reform.
It is learnt that for the approval of the corporate system of central enterprises, the transformation of central enterprise groups into limited liability companies and joint-stock companies have to be approved by the SASAC and the State Council while the reform of subsidiaries of central enterprises has to go through internal procedures of enterprises.
Although the plan was released in July, it is learnt that the SASAC has held symposiums on reforms to arrange tasks in late June. China State Shipbuilding Corporation, State Power Investment Corporation and China Datang Corporation have released reform plans. 18 railway bureaus under China Railway have completed the registration of industrial and commercial changes.
Based on the latest information of Beijing Administration for Industry and Commerce, the applications of 53 Beijing-based Level-I central enterprises for the registration of names have been approved. Three Level-I central enterprises (China Guodian Corporation, China National Offshore Oil Corporation and SinoGrain) and 59 subsidiaries of central enterprises have obtained new business licenses after the completion of the reform.
In the opinion of Wu, the change of industrial and commercial registrations is just the first step in the corporate system reform of central enterprises. Subsequently, it has to pay attention to the following aspects. Firstly is whether central enterprises as independent market participants can fully enjoy autonomous operation and decision-making and participate in fair market competition. Secondly is supporting policies on management concept, business model and human resources as they may face problems on the arrangement of employees and the remuneration reform.
Translated by Star Zhang
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