HONG KONG, Dec 28 – Huawei Technologies, a Chinese manufacturer of telecommunications equipment with a market capitalization of 30 billion dollars this year adopted a system that will allow their top executives take turns for periods of several months in the position of chief executive.
The system of rotating presidency, announced Wednesday by founder and CEO Ren Zhengfei in their end of year message, apparently aims to prepare a smooth transition when Ren, 67, stood down, although it is not known when he intends to retire, according to analysts.
“Huawei is entering the post-Ren,” said Ji Yongqing, author of “The World of Huawei.” “The company expects to realize a smooth transfer of power and firm leadership of its founder and first generation to second generation.”
Huawei, founded by Ren, a media-shy businessman in 1987, became the second largest manufacturer of telecommunications equipment, but had never published his succession plan. Employees of private company are its shareholders.
“The rotation system is better than relying on one person to the company’s success,” Ren wrote in his message to the end of year 130 000 company employees, played by Chinese news sites.
The new structure requires that several senior executives of Huawei, among them the vice-chairman Guo Ping and other members of the council, for six months as acting chief executive, according to the letter of Ren and a source close to Huawei .
Ren, who revealed in the letter have gone through two surgeries to fight cancer, years ago, hopes the new system will help to strengthen corporate governance, while Huawei seeks to expand worldwide, and analysts said the source.
“The company is preparing to continue its expansion. In these circumstances, governance has become extremely important,” the source said. “So Ren adopted this system of command.”
Incoming search terms:
- huawei market cap