| HUMAN RESOURCE/ MANAGEMENT |
June 2006 |
REFORMS
MORE CFOS REQUIRED
By Jennifer Lee
Efforts at reforming China’s state-owned enterprises (SOEs) continued apace this month, with the State-owned Assets Supervision and Administration Commission (SASAC) stepping up pressure on China’s 168 central-government-administered SOEs to appoint a CFO. And just to be sure the CFO isn’t hired to meet the requirement, and then marginalized, the order also outlines the CFO’s duties and rights. The CFO should, for example, be actively involved in major decision-making, assist in hiring the finance team, and oversee major expenditures.
The mandate comes almost immediately on the back of another notice, which stated that central-administered SOEs need to use international standards to appraise their financial performance, a clear effort at getting them to step up their game to get on a par with their multinational counterparts. Prospective CFOs will, no doubt, need to be well versed in international accounting.
Some of the positions, though, may end up being short term. SASAC’s goal for the 168 enterprises directly linked to the central government, according to the People’s Daily, was outlined by SASAC vice chairman Wang Ruixiang at the annual 2006 Boao Forum for Asia, held in April in Hainan province. By 2010, the number of enterprises will be reduced to around half the current number, he said. But for the CFO who chooses wisely, of the remaining enterprises, around 50 are planned to make the Fortune Global 500 list. Currently, 18 are on the list, including such names as China Life and Bank of China. Certainly these SOEs already have CFOs, but many of the others do not. Hence the renewed push, a continuation at efforts to upgrade the SOEs’ finance function that began three years ago.
In one of its more unusual moves towards SOE reform, in March SASAC announced a trial program under which SOEs must appoint an employee representative to their board. The program is aimed at improving SOEs’ efficiency and transparency. Baoshan Iron and Steel and coal producer China Shenhua Energy are part of the trial program.  |
CFOs on the Move
The president and CFO of Sina, Cao Guowei, has been with the Chinese internet and wireless media company since 1999 in various positions including vice president of finance, co-chief operating officer, president, and CFO. Now he takes on the role of CEO, replacing Wang Yan, who was one of the founders of the company and who becomes vice chairman of the board of directors. Cao retains his role as president, but relinquishes his CFO duties. Temporarily taking on that role is Herman Yu, the corporate controller ... Fashion apparel retail marketer IT Limited has hired Dr William Lo as its vice chairman, managing director, and CFO. Lo has been an executive director of China Unicom, CEO of Citibank’s Global Consumer Banking for Hong Kong and Macau, founding managing director of Hongkong Telecom IMS ... Automotive supplier Asimco Technologies in Beijing has brought Kern Lim over from Eastman Kodak in Shanghai to be its CFO. Lim had been CFO of Kodak’s Greater Asia region. He replaces Michael Cronin, who resigned to set up a human resources consultancy practice … Daniel Zhang becomes the new CFO at Shanda Interactive Entertainment on June 30. He was the online games operator’s financial controller until current CFO and director Shujun Li resigned. Before joining Shanda under a year ago, in September 2005, he was senior manager of PricewaterhouseCoopers’ audit and business advisory division based in Shanghai. Li will remain a director of the company. He joined in 2002 as director of investment and overseas business, then became CFO in 2003, leading the company to its IPO in May 2004. – Jennifer Lee |
