App | 中文 |

China to set up accountability system for SOEs

Updated: Aug 23,2016 8:13 PM

The State Council on Aug 23 issued a guideline on setting up an accountability system for illegal operations or investments at State-owned enterprises (SOEs).

The guideline is aimed at preserving and increasing the value of State assets, strengthening the supervision and management of the assets and preventing their loss.

The guideline called for strengthened supervision over departments and positions in SOEs with centralized power, abundant funds, resources and assets in a bid to increase the quality and vigor of SOEs.

According to the guideline, an accountability system and responsibility tracing mechanism will be set up by 2017, and by 2020, an accountability work system covering investors and SOEs at all levels will be set up.

For asset losses caused by mismanagement of enterprise groups, purchase and sales, construction contracts, transfer of property rights, shares of listed companies and assets, investment in fixed assets, mergers and acquisitions, regrouping and system transformation, fund management and risk control, the people in charge will be held accountable.

According to the guideline, related management personnel at SOEs will be held responsible for loss of State assets or other serious consequences if they fail to or incorrectly perform their duties, and they will continue to be accountable even after they are transferred to other positions or retire.

Internal penalties, loss in wages, loss of future promotions, disciplinary punishment, and transfer to judicial organs for further action should be imposed according to the amount of losses or severity of problems.

The guideline urged institutions of State-owned properties and SOEs to clarify the responsibilities of those in charge, and guide them to establish risk awareness, standardize decision-making in business operation and investment, and safeguard State-owned assets.