Fears over China’s push to extend Communist Party’s reach inside foreign firms
Some companies under more pressure to rewrite rules to make party officials involved in business operations, executive says
Late last month, executives from more than a dozen top European companies in China met in Beijing to discuss their concerns about the growing role of the ruling Communist Party in the local operations of foreign firms, according to three people with knowledge of the discussions.
President Xi Jinping’s efforts to strengthen the party’s role throughout Chinese society have reached the China operations of foreign companies, and executives at some of those entities don’t like the resulting demands they are facing.
The presence of party units has long been a fact of doing business in China, where party organisations exist in nearly 70 per cent of some 1.86 million privately owned companies, the official China Daily reported last month.
Companies in China, including foreign firms, are required by law to establish a party organisation, a rule that had long been regarded by many executives as more symbolic than anything to worry about.
One senior executive whose company was represented at the meeting said some companies were under “political pressure” to revise the terms of their joint ventures with state-owned partners to allow the party final say over business operations and investment decisions.
