Salary reforms at SOEs from next year ( 2003-11-19 09:28) (China Daily)
In conjunction with higher standards to test the
performance of State-owned enterprise executives, the Chinese authorities will
offer them better pay and benefits.
Like in many local State enterprises, managers at central SOEs will get
salaries that better reflect the market conditions starting from next year,
according to Shao Ning, deputy director of the State-owned Assets Supervision
and Administration Commission (SASAC).
The commission is also studying stock options, pension benefits and other
long-term incentives for top executives, he said at a forum in Beijing on
Monday.
Shao said the SOEs would also reform the personnel system and hire more
senior executives through open recruitment.
SASAC, the central State assets supervisory body, is now directly supervising
189 of the biggest and central SOEs as the representative of the State in these
enterprises, leaving the rest to the mandate of local State-asset watchdogs.
There has been a tide of restructuring in the economy over the past few years
through mergers and acquisitions of once State-monopolized sectors. Even the
biggest SOEs have been feeling the pressure to reform and boost efficiency.
Li Rongrong, director of SASAC, told reporters last week that the central
SOEs should try to be the pace-setters in their industries within two years, or
they would face more drastic reshuffle.
The commission is also working on a regulation on the performance evaluation
of SOE chiefs, which would be implemented next year. Those meeting the standards
will be able to get an average annual salary of 250,000 yuan (US$30,193), said
Li.
"SOEs are not the training schools for foreign companies," he said, "We
should try our best to retain the talents."
All these indicate that the government has realized that a precondition to
further the SOE reform is to get the right people to run these enterprises and
assure them of corresponding rewards.
In the past, many top executives of the central SOEs were directly appointed
by the central government, normally chosen from civil servants.
But there has been a growing call for more professional executives to make
the enterprises more profitable.
To inject fresh expertise to these enterprises, SASAC has organized a
large-scale global recruitment campaign to find people for seven senior
positions in six central SOEs, including the country's second biggest telecom
operator China United Telecommunications.
The campaign has attracted 463 applicants from home and abroad.
In some major cities, especially Shenzhen, local authorities have already
made moves in SOE executive recruitment and payment reform earlier than Beijing.
In Shenzhen, the general manager and the chairman of a local SOE, who are
normally appointed by local government, can draw a basic annual salary that
ranges from 96,000 yuan (US$11,594) to 120,000 yuan (US$14,492), based on the
size and performance of the enterprise, according to a document adopted by the
municipal government in May.
But if the results of the enterprises are good, they can get bonuses as high
as four times of the salary, which means that the highest gross pay of an SOE
chief can be 600,000 yuan (US$72,463) a year.
