China Takes a Tentative Step Toward Employee Ownership

Over the past several years, China has frequently taken steps toward encouraging equity compensation plans, especially among state-owned enterprises. In 2013, the Communist Party's Central Committee passed a guideline on the reform of subsidiaries of state-owned enterprises that includes employee ownership, and on August 18 the State Council fleshed out that guideline. A potential impact would be equity compensation programs for managers at 200 state-owned enterprises by the end of 2018, when the program will have a progress review.