Volume 2: The Path to Prominence Chapter 51: Corporate Restructuring (Part 3)

The next day, upon arriving at the factory, I immediately reported the results of my discussion with my father-in-law (Director Shu Zhongquan) to Director Shi. Naturally, my report was confined strictly to the matter of securing policy support; I kept silent about the issues concerning the general manager and myself.

After listening to my report, Director Shi felt it was a bit of a pity to learn that there were only two possibilities and no actual cash involved. However, he naturally understood that my father-in-law must have told me the truth and offered constructive guidance. Perhaps realizing this, he said to me:

"Please convey my gratitude to Director Shu. Regarding the pursuit of policy support, we will generally draft our report in accordance with Director Shu's suggestions. However, I believe we should still retain a request for a portion of the registered capital to be contributed in cash, with the amount adjusted to 30 million RMB. Even if we ultimately fail to secure it, we must reserve some room for maneuver. Every level in the hierarchy takes a cut. As for Director Shu, he naturally supports us—of that I am well aware—but I am afraid that someone else might jump out and want to take a cut as well. Please relay this thought of mine to Director Shu; he should be able to understand. I am deeply grateful for his guidance, especially his brilliant move regarding the 'transfer-out' strategy. Please express my sincere thanks to him."

I readily agreed, saying, "I think Director Shi makes complete sense. This approach provides a greater margin of safety. Rest assured, I will handle the rest of the work."

I did not ask Director Shi about the corporate governance structure. The number of members for the board of directors, the board of supervisors, and the executive team was being planned by my father-in-law's reform division. As for the specific candidates, that fell under the jurisdiction of the human resources division. Director Shi communicated directly with them on these matters, and he was also personally in communication with Director Zheng, so it was naturally inappropriate for me to inquire.

Even regarding my own candidacy as a board member, my father-in-law had assured me that he would find a way.

Accordingly, I instructed the Party-Masses Work Division to draft the restructuring petition and plan in accordance with the established principles and basic framework. As for matters involving policy applications, I assigned primary responsibility to the Financial and Capital Division.

Regarding the employee placement plan, it stipulated that all employees would sign new labor contracts with the newly restructured company, with their years of service calculated continuously, ensuring their interests would not be affected. Presumably, the employees would have no objections, and passing the plan through the employee representative congress according to procedures should present no problems either.

Just when I thought the overall situation regarding the restructuring plan had been settled, the calm surface was stirred up by new ripples.

A few days later, Zhang Zhengliang came to my office to report that some cadres and employees, having heard about the restructuring, hoped to implement employee stock ownership. I was somewhat startled upon hearing this. The State-owned Assets Supervision and Administration Commission had already set a firm direction for this restructuring: a simple rebranding from an enterprise owned by the whole people to a wholly state-owned company. How could someone suddenly pop up to play this tune?

"Didn't you explain the spirit of our restructuring clearly to the employees?" I asked Zhang Zhengliang.

"We explained it, but they said that some other restructured enterprises have implemented employee stock ownership, and without it, restructuring loses its meaning. Some even went so far as to say that if employee stock ownership is not adopted, they will cast opposing votes at the employee representative congress."

"Opposing votes?!" Regulations required only that the restructuring plan be communicated to the employee representative congress, not voted on by them!" I sneered.

"But Secretary Wang, the employee placement plan does require their vote. I am worried they might make trouble on that front."

"The employee placement plan is simply the overall transfer of labor contracts with continuous calculation of service years, and it does not affect their interests in the least. On what grounds would they object? Any opposition must have a reason."

Although I said this, I knew in my heart that Zhang Zhengliang was right, and that he was sincerely looking out for me and offering advice. I therefore softened my tone and asked instead:

"Who are the people behind this?"

"The ordinary rank-and-file employees are actually a minority. Most of them are factory cadres—workshop directors, section chiefs, and even a few division directors and deputy division directors. They've probably seen management and employees reap the benefits of stock ownership during restructurings in other provinces, so they want to seize this opportunity to hold some shares themselves."

"However, the policies from above are fixed. We can't just implement stock ownership simply because we want to. You must continue to do a good job with policy publicity."

"Understood. We will continue with the publicity and explanatory work. My only worry is that if this sentiment spreads and involves more and more people, it will become difficult to manage."

"Give them a firm response and leave no room for ambiguity. If necessary, I will report this to Director Shi and specifically address the SASAC's spirit and requirements regarding restructuring at the next factory administrative meeting."

Although I was surprised to learn that cadres and workers harbored such thoughts, I believed that the higher-level policies were crystal clear; once these ideas were clarified to them, they would drop the notion. Therefore, I was not overly worried.

To my surprise, the very next day, Lin Ke also sought me out to report on the matter. After listening to his report, I watched him placidly for a moment before asking:

"And what is your view?"

"Personally, I think implementing employee stock ownership helps boost everyone's enthusiasm, and it is a tangible benefit for the cadres and employees. I think it's a good thing. Of course, I personally submit entirely to the decisions of the factory and you, Secretary Wang."

Hearing Lin Ke speak this way, I understood his stance. As it turned out, he was one of the individuals holding this mindset—and he might even be the instigator and spreader, though this could not yet be proven.

"This is not a matter of the factory's or my personal decision; the SASAC has clear policies and requirements. I'm sure you know that!" I said firmly.

"Although the policies from above are set that way, regarding matters involving the interests of the factory's cadres and employees, I believe we, Secretary Wang, can still actively lobby the higher authorities for them." Pausing for a second or two, he continued, "Figures like Director Shi and yourself, Secretary Wang, have made monumental contributions to the development of the factory. As for whether we should hold shares, in my view, not only should we hold shares, but we should hold more shares and larger stakes."

Good grief! He even brought up Director Shi's name and cloaked his words in the guise of looking out for my interests, when in reality he was merely trying to fulfill his own personal desires and ambitions, I sneered inwardly.

"If I were to hold a large stake, do you think I would have that kind of money to buy it?" I asked calmly. I thought to myself: If I actually had that kind of money, given my income, the question of where it came from would become a whole new problem.

"If purchased at the original price, Secretary Wang, you might not be able to afford it. But everyone's view is that the state contributed very little to the factory's current profitability and scale; it was built primarily through the hard work and struggle of the factory's cadres and employees. Therefore, a portion of the factory's assets should be directly quantified and allocated to the employees during the restructuring."

At this, my mind became even clearer. So they were trying to misappropriate state assets! Did such a thing exist under heaven? Driven by personal greed, they could dream up anything. Moreover, when Lin Ke claimed this was "everyone's view," didn't that precisely expose him as their representative, the ringleader pulling the strings? He was treating me like a fool.

"Do you think state assets can just be handed over to you because you ask? It's not that we don't acknowledge the role of cadres and employees in the factory's development, but didn't the factory pay your wages and bonuses? I see that you, Director Lin, receive quite a substantial bonus every year." I continued, neither fast nor slow.

"Personally, it doesn't matter much to me whether I hold shares or not. The crucial point is that you factory leaders and all these cadres and employees should hold shares. I feel it would be a pity to miss this opportunity. As I said before, in any case, I firmly obey the decisions of the factory and you, Secretary Wang."

Oh, please! You are the one who speaks most frequently of obedience on the surface, while pulling strings behind the scenes. As if I didn't know, I thought to myself.

"As I just stated, we will handle this in accordance with SASAC regulations and requirements."

"Very well, Secretary Wang. It is my duty to truthfully report the situation and offer my suggestions to you. Since you insist on handling things according to SASAC regulations and requirements, I personally will comply with them."

"Not just you personally. As the division director in charge of cadre and personnel work, you must also take responsibility for explaining SASAC policies and requirements clearly to those cadres and employees holding such ideas. This must not affect the overall situation and stability of the factory's restructuring," I added, emphasizing my tone.

Lin Ke agreed. Whether sincere or not, I figured that with the principles laid down by the SASAC and my explicit instructions, he at least wouldn't dare to blatantly push his agenda anymore. However, I understood that if their demands went unmet, the group of people Zhang Zhengliang mentioned might genuinely cast opposing votes at the employee representative congress, and I could not lower my guard. After much deliberation, I decided I still needed to report this to Director Shi and make SASAC's spirit regarding the restructuring public at a factory administrative meeting. Otherwise, some people would continue to harbor illusions, and if someone incited them to disrupt the employee representative congress's vote on the employee placement plan, it would turn into quite a formidable headache.