China will establish a system of accountability for illegal operations and investments by State-owned enterprises (SOEs), the State Council, the country's cabinet, announced on Tuesday.
The system aims to improve the operational quality of SOEs, strengthen their economic efficiency and maintain and increase the value of State-owned assets, according to a guideline published on the State Council's website on Tuesday.
Senior managers who violate relevant regulations or fail to perform their duties in areas like group administration, sales, and merger and acquisition deals, will be held accountable, the statement noted.
The guidelines also specify the penalties that could be involved, including demotion, limits on serving as SOE's key members and referral of cases to the judicial authorities, said the statement.
The accountability system is expected to be basically formed by the end of 2017 and finalized by the end of 2020, said the statement.
SOEs' profit tumbled 8.5 percent year-on-year in the first half year of 2016, according to official data published on the website of the Ministry of Finance.