Big Take Asia
Why China’s Investment Bankers Are Breaking Up With Capitalism
Jul 2, 2024
Bloomberg's Cathy Chan discusses how China's top investment bank, CICC, is shifting towards socialist ideals and prioritizing loyalty to the Communist Party over Western influence. The podcast explores the impact of President Xi's common prosperity initiative on the investment banking industry, including decreased deal activity and reductions in bonuses. It also dives into the cultural changes at CICC under a state-owned background chairman, affecting talent retention and the decline of the bank. Additionally, the podcast highlights China's concerns about foreign companies being associated with the Communist Party and the benefits of aligning with China's norms for business dealings.
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Quick takeaways
- CICC bankers prioritize Communist Party loyalty over capitalism, reflecting China's shifting financial landscape.
- Under Xi Jinping, CICC aligns with party interests, causing talent exodus and concerns over business environment.
Deep dives
CICC's Transformation under New Leadership
The China International Capital Corporation (CICC) underwent significant changes in priorities and ambitions under new leadership, shifting from a Western-oriented approach to aligning more closely with the Chinese Communist Party. With 30% of staff becoming Communist Party members, the internal culture shifted, emphasizing party loyalty and patriotism. This shift towards party alignment raised concerns among global investors about China's business environment.
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