China to pursue democracy in state-owned enterprises

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Last updated at: (Beijing Time) Wednesday, October 15, 2003

China to pursue democracy in state-owned enterprises

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China's major state-owned enterprises (SOEs) should make public their managerial affairs andmake this practice part of the management system, to ensure democracy and improve corporate governance, said an official Tuesday.

Wang Ruixiang, vice director of the State-owned Assets Supervision and Administration Commission under the State Council (SASAC), said at a SASAC conference promoting information disclosure in major SOEs, that the key is to clearly define the responsibilities of decision makers from other staff members and the labor union.

Major decisions concerning the company's operation should be decided by the shareholders' meeting and the directorate, and listen to the general workers' opinions through the information disclosure system, while important issues concerning the direct interests of the workers should be first discussed and approved bythe workers' congress and then decided by the directorate, Wang said.

SASAC declared its intention to transform its 191 SOEs into standard corporations, that is, to establish corporate governance based on the Corporate Law of the People's Republic of China, within three to five years.

"One of the most important premises to achieve the goal is to stress workers' status as the owners of the enterprises and to ensure their democratic rights," Wang said.

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