Imagine
for a moment that you are on vacation at Club Med and the e-mail comes that the
Chairman of Club Med’s parent company has missed the Board meeting and will be
helping the police for an unspecified time.
There is
a good reminder in Gordon Crovitz's column today
in the Wall Street Journal [China Disappears Information] that China’s
companies are not like ours. He is more
concerned about the types of information that are normally used in business
acquisitions or stock trades being taken away to protect China’s market
position in world’s markets. I’m
thinking about this in a different way.
I saw a
few businesses raided for criminal behavior, since law enforcement in this
country occasionally arrests those responsible for it at their place of
business. It is a jarring experience for
those involved. People cry, yell, flush
things down the toilet, pound on a desk, hide papers, go out the back door, erase
information off their computers or do all kinds of things that we don’t
normally see professionals do. But, as
Crovitz noted in his column, “In all executives from 34 [Chinese] companies
have disappeared, with only some reappearing.
Among those was Guo Guangchang. Chairman of the Fosun Group, who is
known as China’s Warren Buffet. His
interests include Cirque du Soleil, Club Med, and the former Chase Manhattan
Plaza…”
In no
criminal business raid did I ever see a person taken away without telling the
people around him/her why the person was being removed. Lawyers in corporate offices would want to
know. Boards want to know that the
Chairman is not going to be there today.
Staff around the CEO would want to know that the Chairman was, in the
British term fitting a Hong Kong example, “helping the police”. That is a nice term that covers a lot of bad
situations without saying a person is guilty or innocent, presumed or not.
Some of
these people who disappeared never reappeared.
Where did the Chairman go we asked?
Perhaps has been replaced by someone appointed by the government to help
you while he is helping the police. In a
super-conglomerate, somebody else takes over while he is gone and the business
never misses a beat. That is the theory
anyway, but that is never quite true.
There are
a lot of beats missed when the Chairman misses his first Board meeting. How do we not notice that he/she is missing
and we have no idea why that is? The
Russians used to say that a person like that was “on vacation” or went to a
mental institution for rehab. That is a
nice approach and actually makes more sense than just plucking them off the
mahogany row and taking them out of circulation until they get the answers they
are looking for. In a country where
Party position means more than business position, this kind of thing can happen
and they don’t get too excited about it.
This is what passes for a managed economy. Managed may not be the most accurate term we
could apply when police can come and detain you without cause, round out your
business education with some new facts of life, then release you into the world
to carry on again. What does that sound
like to you?
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