On Sunday the Communist Party of China (CPC) General Office published an official circular, co-issued by the Department of Organization of the CPC and the Party Committee of the State Council Commission for Supervision and Management of State-owned Properties.

It called for strengthening CPC organization within state-owned enterprises (SOEs), particularly those owned and administered directly by central government.

The document urged SOEs to reinforce the role of Party organizations and push forward managerial reforms.

It described them as the pillar of the economy and central government-owned enterprises in particular as playing a leading role in the state economy.

"To bring the role of state-owned companies, especially central government-controlled ones, into full play is a must for adhering to and improving the fundamental socialist economic system, developing advanced productivity, increasing integrated national strength, and consolidating the Party's ruling status," the circular said.

It puts forward a guiding ideology, general goal and major tasks for strengthening the Party within SOEs so as to push forward reforms in organization, technology and management.

There are now 186 centrally controlled enterprises. They constitute a significant part of the state economy, and their management is closely monitored and controlled by central authorities.

Greater correspondence between SOE and Party officials is being encouraged: Party committee members may hold positions on the board of directors, board of supervisors or managerial board, while board members who are already Party members can join Party committees.

If qualified, the chairperson of the board of directors and the secretary of the Party committee in a state company could be the same person. But in principle, the chairperson of the board and the general manager should be two different people.

The role of Party committees in SOEs is to set criteria for selecting managerial personnel, strictly checking candidates, improving assessment mechanisms, and strengthening supervision.

The circular said that Party organizations should be made more efficient and the fight against corruption enhanced.

It also said that staff should be encouraged to play an active role in the democratic management of enterprises, and their legal rights should be safeguarded.

(China Daily January 24, 2005)