ecns [expanded by feedex.net]: SOE reform to center on employee stock ownership

ecns [expanded by feedex.net]

ecns

SOE reform to center on employee stock ownership
http://www.ecns.cn/cns-wire/2015/01-22/151921.shtml
Jan 22nd 2015, 07:56



2015-01-22 16:56 Web Editor: Mo Hong'e


(ECNS) -- The State-owned Assets Supervision and Administration Commission (SASAC), China's top state-owned assets regulatory body, held a conference to promote reform of state-owned enterprises (SOEs), with employee stock ownership plans in development, the Ministry of Finance said on its website.


As a significant form of income distribution, employee stock ownership could prove to be a strong incentive for employees, an insider commented.


However, the policy should not be introduced all at once, as effective management, supervision and operation of employee stock ownership plans would be needed to prevent the loss of state assets, it was added.


Employee stock ownership plans are more suited to highly technical enterprises such as academic institutions and high-tech companies, and not to monopolistic businesses and government policy units, according to authorities.


Employee and Management Buy-outs (EMBO) are not recommended. Strict regulations regarding proportions of employee share holdings should also be formulated.


"Employee stock ownership is one form of mixed ownership, with plans to be drawn up soon, and hopefully more enterprises taking part in the pilot project," said Li Jin, vice chairman of China Enterprises Reform & Development Society.





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