The party¡¯s expanding presence in business

[Randy W]

in the NY Times

 

China’s Communists Rewrite the Rules for Foreign Businesses

The party is strengthening its influence — often gaining direct decision-making power — over the international firms doing business in China.

 

 

Honda, the Japanese automaker, changed its legal documents to give the party a say in how its Chinese factories are run. A Chinese state oil giant vowed to put the party front and center in its joint ventures with foreign partners.

And Cummins, the engine maker from Indiana, felt the party’s reach, too, when it tried to appoint a new manager for one of its China businesses. The party said no.

“In the past the American general manager did not understand why the party was involved in decision making,” said Hu Hongwei, the party’s representative to Cummins’s China joint venture, according to The People’s Daily, the party’s official newspaper.

But Cummins’s Chinese partner then rewrote the business’s articles of association to give the party more power, Ms. Hu said. The American manager “has begun to understand it,” she added.

. . .

The Communist Party has long been part of doing business in China. While party committees are a fixture in many foreign-managed workplaces, they were seen by foreign executives for years as more like social clubs. They would meet to read party announcements, recruit new members, make sure dues were collected and generally keep an eye on operations.

But on at least three occasions in recent months, foreign executives have been approached by their Chinese joint venture partners demanding that they involve internal party committees in strategic decisions, say lawyers and business executives.