Bloomberg: Chinese bankers forced to study Xi’s thoughts as party tightens grip

According to an analysis by Bloomberg, Xi Jinping Thought is becoming inescapable for bankers and businesspeople across China. Caliber.Az reprints this article.

The Communist Party leader’s musings on everything from the economy to space missions have long been required reading within the party and China’s government. But with Xi Jinping now months into a precedent-breaking third term — and with no limits on how many more he can serve — study sessions on his ideology have also become mandatory for staff at many state-owned and private-sector companies.

Even employees at global firms including BlackRock Inc., the world’s biggest fund manager, have been called in to attend lectures on the topic by regulators.

The study sessions — viewed by some as time-consuming chores — underscore the growing role of ideology in China as Xi tries to increase the party’s influence over many aspects of local life, including a corporate sector that’s been chastened in recent years by a series of government crackdowns.

While few would dispute the importance of becoming familiar with the world view of the country’s most powerful leader since Mao Zedong, sceptics privately question the usefulness of spending hours each week poring over often-arcane sayings by the Chinese president.

At a time when economic growth is consistently trailing expectations, some also worry about the hit to productivity. Even if time spent studying Xi Jinping Thought is unlikely to appear in any formal economic models, it’s symptomatic of the government’s elevation of politics above everything else.

“Every hour workers spend doing something else is an hour they aren’t doing their jobs,” said Victor Shih, an associate professor at University of California San Diego who specializes in the politics of China’s banking policies.

China International Capital Corp., one of the nation’s top investment banks, had to step up efforts to study Xi Thought in recent months as authorities were unhappy with their learning outcome, according to a person familiar with the matter. State-owned Bank of Communications Co. has been holding monthly study sessions across all departments since late 2022, another person said, adding each attendee will be asked to share their understanding and assess how that might impact the finance industry.

At a late June event, representatives from onshore operations of foreign asset managers including BlackRock and employees of a minority owned venture by Franklin Templeton joined over 3,000 employees from more than 70 fund houses to hear a lecture on sticking to the party’s leadership in the industry, according to a release by the organizer Shanghai Asset Management Association.

Bank of Communications, CICC, BlackRock and Franklin Templeton weren’t available for comment.

Dragged In

At a Beijing-based state-owned energy company some employees said they were increasingly being dragged into impromptu training during working hours. Such sessions, often centred around Xi’s latest remarks, were held at an isolated facility with mobile phones confiscated sometimes, making it hard for coworkers to reach out to them in case of a work-related emergency, according to these employees, who asked not to be identified as the matter is private.

Some bank executives and business heads have to take around a third of working time to study Xi Thought, joining activities and courses, or reading four books from Xi every month, according to people familiar with the matter. Attendance is mandatory this year and they also need to submit papers on what they’ve learned.

At the same time, bankers have seen steep cuts in salaries and the rollback of many perks, such as business travel, all to comport with a key tenet of Xi Thought: “common prosperity.”

Xi has been worried about the growth of capitalism in China, among other issues, that could be a threat to the regime, according to Chenggang Xu, a senior research scholar at Stanford Center on China’s Economy and Institutions.

The number one issue is “to make sure that no one is going to threaten the regime and the Communist Party’s leadership,” said Xu, who will soon release a book on totalitarianism in China. “Only under that condition is economic growth important.”

There are now signs, however, that the state of the economy is starting to cause major concerns in Beijing. Officials are now easing up on their scrutiny of technology firms and have rolled out repeated pledges of support for private companies.

Fundamentals

Unveiled in late 2017, the main tenets of Xi Thought centre around eight fundamental issues and goals, including “common prosperity” for everyone, according to the official Xinhua News Agency. It also lays out 14 fundamental principles to guide China’s endeavours, with the topmost being ensuring the party’s leadership over all work.

Sticking to those mantras, Xi’s administration has cracked down on private enterprise such as technology and the education sectors, while combating corruption at bureaucracies and state-owned enterprises. An anti-graft drive focused on China’s $60 trillion finance industry, where high wages have sparked controversy, has brought down dozens of high-ranking officials and financial executives since late 2021.

To comply, many businesses have hired external experts and academics to give lectures for employees. The expectation among some firms is that actively participating in such study sessions and activities will help them showcase their allegiance and better navigate in an economy where the Communist Party has the ultimate say.

So far this year, firms including Industrial & Commercial Bank of China Ltd. and Bright Food Group Co. were among those that have sent employees to attend lectures at the memorial hall of the first national congress of the Communist Party in Shanghai, according to the venue operator. The lecture includes a part on the admission oath to the Communist Party and a ceremony for reoathing to the party flag.

The official website for Xi Thought education, managed by the People.cn, has a record of hundreds of seminars and lectures held by local governments and companies including China Petroleum & Chemical Corp., or Sinopec. The oil giant warned employees of the grave difficulties facing its anti-corruption work at a June meeting, asking employees to study Xi’s key remarks and vowing to strengthen the Party’s leadership in its corporate governance.

China National Pharmaceutical Group Corp., or Sinopharm, gave a list of 20 must-read items for its employees who are party members to learn the latest theoretical achievements, according to a release dated July 21. This will help prepare employees to “get a firm grip on the steering wheel” and cope with potential risks and challenges, the company said.

ICBC, the world’s largest bank by assets, set up book reading classes as part of its study campaign and utilized the party’s theories to guide its work to deepen reforms and prevent financial risks, according to a Xinhua report in late April. Bank of China Ltd. and Bank of Communications also had reading classes on ideology.

“Wall Street people always think every country should put their financial sector ahead of everything else,” said Zhiwu Chen, a professor of finance at the University of Hong Kong Business School. “They don’t realize that over the last 10 years the Chinese Communist Party has been saying politics should be first and foremost on everybody’s mind, not economic benefits, not economic profits.”