Reforms needed to root out nepotism

A State-owned metal recycler in Huizhou, Guangdong Province, drew criticism from the public recently thanks to reports that eight employees hired since 2009 were related to leaders within the company.

Elsewhere, another State-owned enterprise (SOE), Daqing Oilfield Co Ltd, recently revamped its hiring practices to include a stringent performance review of prospective employees whose parents already work within the company. Previously, children of Daqing workers had been known to land coveted positions upon graduation.

Many are surprised that some SOEs still offer such favorable policies despite government calls to establish a more market-oriented economy.

Reformers should focus on installing modern corporate governance structures within SOEs. Such changes are necessary to curtail abuses of power.

Based on a report from the Southern Metropolis Daily.