China has issued revised regulations on honest and clean conduct of leaders of state-owned enterprises (SOEs), reinforcing stricter supervision to prevent corruption and protect state assets.
The rules, first approved by the Political Bureau of the Communist Party of China (CPC) Central Committee in 2009 and recently revised, were released by the general offices of the CPC Central Committee and the State Council on Feb. 28.
The rules apply to leaders at wholly state-owned and state-controlled enterprises, as well as enterprises effectively controlled by the state, including financial firms and their branches.
The enterprise leaders are required to stay loyal to the Party, act lawfully and transparently, avoid conflicts of interest, protect workers' rights and public interest, and practice frugality in line with central directives.
They are prohibited from abusing power, harming state assets, using their positions for private gains, engaging in unauthorized commercial activities or investments, nepotism or favoritism, pursuing short-term political achievements that endangers enterprise stability, as well as from formalism, bureaucratism, extravagance and misuse of corporate funds for personal or improper purposes, according to the regulations.
The document mandates annual reporting from such leaders and regular Party-led oversight, as well as targeted inspections and integration of Party supervision with audit, regulatory, shareholder and employee oversight.
The regulations highlight special anti-risk measures for overseas operations, and stricter exit controls for departing leaders.
For violators, the document states that disciplinary, administrative and criminal penalties will be imposed where applicable.
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