Jack Ma to step down as Alibaba head

2018-09-11 00:52:00 | From:GlobalTimes

  Alibaba Group Executive Chairman Ma Yun, or Jack Ma, announced on Monday that he will be stepping down as chairman at one of the largest e-commerce companies in the world to focus on teaching.

  In an open letter on Monday, Ma, who started his career as an English teacher and went on to establish one of China's as well as the world's biggest e-commerce companies, said that Alibaba CEO Daniel Zhang Yong will become the new executive chairman in September 2019 as part of a succession plan to maintain sustainable growth at Alibaba.

  "This transition shows that Alibaba has stepped up to the next level of corporate governance from a company that relies on individuals to one built on systems of organizational excellence and a culture of talent development," the Chinese billionaire wrote.

  Ma's decision won't have a negative effect on Alibaba's operations, Li Chao, an analyst at Beijing-based consultancy iResearch, told the Global Times on Monday.

  "The market would have concerns about Alibaba's future, as the company has been closely identified with Ma's values and business insights, and it remains uncertain whether Ma's successor will enjoy as much respect in and out of the company," Li said.

  However, Alibaba still has a year to adapt to the change, and for a company that has already established a mature management system, Ma's choice won't shock the company and the market, Li noted.

  On Wall Street, Alababa's share opened 2.3 percent lower on Monday to $158.50 on the news of Ma's retirement.

  The billionaire also noted he is not leaving Alibaba entirely, saying he would continue to be a business partner and contribute to the company's long-term growth.

  "The one thing I can promise everyone is this: Alibaba was never about Jack Ma, but Jack Ma will forever belong to Alibaba," Ma wrote.

  Setting the example

  "Ma made a landmark decision that many Chinese entrepreneurs, especially those who have become the face and voice of their company, still hesitate or fear to do," Zhu Wei, a professor at the China University of Political Science and Law, told the Global Times on Monday.

  The fear of losing power in a company still undergoing rapid development has prevented many Chinese entrepreneurs from retiring or reforming their companies, Zhu said.

  "No company can entirely rely on its founders. Of all people, I should know. Because of the physical limits on one's abilities and energy, no one can forever shoulder the responsibilities of chairman and CEO," Ma said in the open letter.

  A company should have a modern operation and management system, instead of paternalistic leadership, to drive its development, so that the leaders would have a "positive influence" instead of "control" over business decisions, Zhu said.

  In the letter, which was issued on the Teachers' Day in China, Ma said he would return to teaching without further elaborating.

  It will be a trend in China for more and more entrepreneurs to contribute to society even after retirement, Zhu said.

  Entrepreneurs also have a significant role in fulfilling their corporate social responsibility and their mission could be carried out after retiring, and Ma's decision has set a sound example of this, Zhu noted.

  Ma also co-founded Hupan University, a business school, to help train young entrepreneurs.

  The university got entangled in controversy after some students of the university showing support to their alumna Liu Qing, president of China's largest car-hailing platform Didi, which came under fire after two women were raped and murdered by Didi drivers.

  Many observers and commentators accused the university of being a "clique" of the social elite who care more about profits over the safety of its customers.

  Entrepreneurs have the responsibility to respond timely to issues of great public concern, and it's part of their responsibility to bring positive energy to society, Zhu said.

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