Giant bike sharing firm Ofo is letting the Chinese Communist Party have a say in the company's 'major decisions'

Ofo share bikes China

Bike sharing giant Ofo will include the role of the Chinese Communist Party (CCP) within its corporate charter.
Ofo will also allow its CCP committee to provide input on personnel issues and "major decisions."
The purpose of these committees, which are sometimes legally required, is to "promote and implement the Party’s line, principles and policies."
Ofo's decision came a week after rule was proposed that would require all firms to have a Party committee before being listed on the stock exchange.

Bike sharing giant Ofo will be changing its corporate charter to highlight the role of the Chinese Communist Party (CCP) in its operations.

The company's CCP committee will also now be able to provide input on Ofo's personnel and "other major decisions" before they're executed, according to state-run Global Times.

All five founders of Ofo reportedly became CCP members while at university, and last year the company established its own CCP committee for its 167 Party members.

"What Ofo has achieved so far is based on the CCP and the government's policy guidance and support of Internet companies and entrepreneurship," the company said at the time.

Dozens of large Chinese internet companies and other startups, including Alibaba, Baidu, and Tencent, have Party committees with thousands of members. Foreign firms, including Walt Disney, have also established their own Party committees which are intended to "promote and implement the Party’s line, principles and policies" and, by one interpretation, act as "the Party’s battle fortresses inside enterprises.”

Committees are present in around 70% of all China's private companies — essentially a legal requirement — and have continued to expand under President Xi Jinping who has put an increased emphasis on strengthening the Party's leadership in society.

The State Council Information Office (SCIO), which also acts as the Party spokesman’s office, told Reuters last year that "company party organizations generally carry out activities that revolve around operations management, can help companies promptly understand relevant national guiding principles and policies, coordinate all parties’ interests, resolve internal disputes, introduce and develop talent, guide the corporate culture, and build harmonious labor relations.”

But Ofo providing CCP members are large amount of input for "major decisions" could signal a new era of influence for these committees, with the potential to affect a company's global market.

Ofo's decision came a week after the China Securities Regulatory Commission reportedly proposed a requirement for all of China's publicly-listed companies to have their own Party committees before they'd be allowed to go public.

The close relationship between businesses and the CCP has also been a cause for concern between Western countries and telecommunications companies ZTE and Huawei, which have faced pushback from politicians, military, and intelligence officials.

Concerns exist around the ease with which Beijing, under the 2017 National Intelligence Law, can order Chinese companies to participate in "national intelligence work."

Business Insider has contacted Ofo and will update this story once it receives a response.

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