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Business / Economy

Officials urged to cut company ties

(Bloomberg) Updated: 2014-07-24 07:17

More than 200 senior Chinese officials were ordered to quit company jobs they held when they were working in the government, in a move meant to root out conflicts of interest and corruption.

The demand was made after the Communist Party's Organization Department passed a rule in October banning government and party officials from also holding outside jobs, the official Xinhua News Agency reported on Wednesday.

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A department task force found that 40,700 officials - including 229 at the provincial or ministerial levels - had extra jobs.

President Xi Jinping has been waging an anti-corruption campaign since he took office in 2012 with warnings that graft and conflicts risked the Communist Party's legitimacy.

The Organization Department said banning senior officials from businesses would help build "a sound market order," according to the Xinhua News Agency.

The Organization Department order triggered "an exodus" of independent directors from about 300 listed companies in Shanghai and Shenzhen, the Economic Observer newspaper reported on Wednesday.

Ba Shusong, deputy director of financial research institute at the Development Research Center, stepped down on July 22 as an independent non-executive director at China Minsheng Banking Corp, a post he had held since 2012,.

The center is a government think tank under the State Council, China's cabinet.

Ba resigned because the research center required its staff to quit corporate posts, according to a statement posted on Minsheng's website.

Under current regulations, retired officials can work for companies as long as they can prove that the new positions are not related to their previous ones.

 

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