——The distance relationship between Zijin and the government
Enterprises must operate according to the market mechanism - govern by doing nothing and regulate the government's behavior - from absolute holding to relative holding, The best way to solve the separation of government and enterprises - doing nothing but doing something, a win-win situation for enterprises and the government
In the Zijin showroom on the first floor of Zijin Building, No. 277 Beihuan Road, Shanghang County, Fujian Province, people can see Go to the majestic model of Zijin Mountain, see Zijin Mining’s beautiful long-term plan, and see the various honorary certificates and patent certificates Zijin Mining has obtained through its own efforts. But what also left a deep impression were the photos hanging on the wall of leaders from relevant departments of the country, Fujian Province, Longyan City, and Shanghang County inspecting Zijin Mining, photos of them taking photos with Zijin leaders, and their messages to Zijin Mining. inscription.
There is no doubt that these photos and inscriptions reflect the concern and support of leaders at all levels for the development of Zijin Mining and their full recognition of Zijin’s achievements. However, Zijin people hang these photos and inscriptions in their own showrooms. , but it makes people think about another serious question - in the development of Zijin, how do they deal with the relationship between enterprises and the government?
Due to historical reasons, the relationship between Chinese enterprises, especially state-owned enterprises, and the government has always been an important factor restricting the normal development of enterprises. In many places, the phenomenon of governments eating large enterprises occurs from time to time; in other places, the government treats enterprises as its own pocketbooks, cash cows, and small treasury. As a result, enterprises bloom and fall, just like a flash in the pan, and it is difficult to achieve everlasting benefits. Tree.
As a special industry, what is the relationship between gold mining companies and the government?
Gold is a specific mineral that is listed as protected mining by our country. The state implements planned mining. No unit or individual is allowed to mine without the approval of the national gold management department. Under the planned economic system, the state ensures the supply of the main allocated materials needed for gold production, and imported materials are exempt from import taxes. These regulations make the gold industry a relatively independent and closed production system.
From the perspective of product operation and sales, as mentioned above, gold products are not market-oriented competitive products at this stage. Products are managed uniformly by the state, with unified purchasing and distribution. Although my country's gold price has been basically in line with the international gold price since 1993, its mechanism is still non-market-oriented, and the price setting and floating methods have strong administrative aspects.
The planned and monopolistic nature of production and management of China’s gold industry determines the particularity of the management model of the gold industry. The state has always set up special management agencies to directly supervise and manage the operation of the gold industry. However, the state's adjustment of gold management agencies has never reached a stable state: from 1949, the Ministry of Heavy Industry of the Central People's Government was responsible, and in 1956, the Metallurgical Industry The Ministry of Metallurgical Industry took over, and the Gold Professional Company of the Ministry of Metallurgical Industry was established in 1965. The Gold Administration Bureau of the Ministry of Metallurgical Industry was established in 1976. China Gold Corporation was established in 1979. The National Gold Administration Bureau was established in 1988. In 1993, it was changed to the Gold Administration Bureau of the Ministry of Metallurgical Industry. In 1998 In 2006, it was renamed the Economic and Trade Commission Gold Management Bureau.
From a macro perspective, my country's gold companies have many problems such as multi-party management, departmental management and serious loss of state-owned assets. In our country, gold resources are managed by the Ministry of Land and Resources, gold production is managed by the Gold Administration Bureau of the State Economic and Trade Commission, and product circulation is managed by the Currency and Gold and Silver Bureau of the People's Bank of China, resulting in a disconnect between gold resource management, production management and product management. This kind of multi-headed management makes it difficult to fully implement the unified management functions of exploration, development, production and construction of gold production by the gold authorities clearly defined by the state in practice. The increasingly complex social environment of the gold industry has greatly increased the management of the gold industry. difficulty. In addition, the gold industry still implements departmental management based on administrative means, rather than industry management based on economic and legal means, which makes the marketization process of the gold industry lag far behind other industries.
When Chen Jinghe, a former geological captain, made up his mind to develop Zijin Mountain, he may not have had time to think carefully about the main problems facing the management of China's gold industry. However, when Chen Jinghe took charge of Zijin Shuaiyin , he used his actual actions to give a clear relationship between the government and enterprises, although he may not have been fully aware of it at the time.
When Chen Jinghe moved to Shanghang in 1993, the then Shanghang County Party Committee Secretary was afraid of wronging him, so he said to him: "You are the talent we introduced. You will serve as the deputy director of the Economic Committee and be in charge of Mining!" But Chen Jinghe replied almost without thinking: "I came here to develop Zijin Mountain. If it is not useful, I will directly participate." So, he took office, and the scale was small and the efficiency was not good. Manager of Shanghang County Mining Company.
At that time, Chen Jinghe may have had a subconscious idea in his mind - the government is the manager and service provider; enterprises are the actual participants, and the two should perform their respective duties and maintain a certain distance.
Five years later, in 1998, Chen Jinghe accepted an interview with reporters. When talking about the relationship between the government and enterprises, Chen Jinghe gave a clear answer: “The development of enterprises cannot be separated from the support of the government. The rapid development of Zijin Group is inseparable from the support of the Shanghang County Party Committee and the county government. Shanghang County is a poor county with relatively difficult finances. However, the county adopts a policy of letting the company go and never interferes with the company's operations. It provides strong support to the introduced talents in terms of settlement, employment of their families, and education of their children. It has created a good environment for the development of Zijin Group.”
From all senior managers of Zijin, one can feel the importance they attach to the development of the enterprise from the main leaders of the Shanghang County People’s Government and government departments at all levels. Full recognition and gratitude for the role played.
Indeed, the Zijinshan Gold Mine, located in a poor mountainous county, has been able to develop rapidly under market economy conditions, and a good external environment has played an important role.
If there is no separation between government and enterprises, there will be no way out for enterprises. In the process of establishing a socialist market economy, it is essential to abandon the outdated model of managing enterprises under the planned economic system and truly implement the "separation of government and enterprise". At this point, the leaders of Shanghang County Party Committee, County Government and Zijin Mining formed a consensus. "The Gutian Conference will always shine brightly." The Shanghang County Party Committee and County Government did not let the surrounding mountains block their ideas. Instead, they insisted that "development is the last word", sought truth from facts, kept pace with the times, and effectively implemented the "planning, "Coordination, supervision and service" government functions, and strive to create a relaxed development environment for Zijin Mining.
In response to the "distance relationship" between the government and enterprises proposed by Zijin Mining, Shanghang County leaders made it clear that the government should do government affairs and enterprises should do enterprise affairs. The government should create loose conditions for the development of enterprises. environment, actively provide services, and do not interfere in the internal affairs of the company.
The government’s recognition of the distance relationship between Zijin and the government has given Zijin Mining Group a great deal of autonomy. Except for the company’s chairman and general manager, who are managed by Shanghang County, other people, finances and materials Basically, all power has been delegated to enterprises, which allows enterprises to do big things with free hands and greatly stimulates the enthusiasm of enterprises for development. In order to ensure that Zijinshan Gold Mine develops into the largest gold mine in China with world-class standards and to solve the company's power supply problem, Zijin Mining invested more than 30 million yuan to build the Bashang Hydropower Station in Shanghang County with an installed capacity of 4,800 kilowatts. This project was developed by Zijin The mining industry itself organized experts to conduct scientific demonstrations before implementing it, but the Shanghang County People's Government did not intervene.
The leaders of Shanghang County are also enthusiastic about creating conditions and providing services for the development of Zijinshan Gold Mine. In order to ensure the development needs of the Zijinshan Gold Mine, the local government of Shanghang County and relevant departments have given the mine strong support in terms of land acquisition, forests, funds, environmental protection, and the creation of a stable surrounding environment. Zijinshan Gold Mine is a new type of mine developed in recent years. It is short of talents and is in urgent need of senior professional and technical talents in various specialties. To this end, Zijin Mining opens its doors, implements marketization of employment, and recruits talents from all over the country. Under the circumstances of great employment pressure in the county, Shanghang County leaders started from the actual needs of the development of Zijinshan Gold Mine and provided policy support to Zijinshan Gold Mine. The remarkable results achieved by Zijin Mining's talent strategy in 1992 and 1993 were inseparable from the strong support of the Shanghang County Party Committee and County Government. A senior engineer who resigned from the northwest region and brought his family to the Zijinshan Gold Mine was given the green light by the county to settle down in Shanghang. It is precisely with the strong support of leaders and departments at all levels in Shanghang County that Zijin Mining Group Corporation has introduced more than ten famous mining, processing, metallurgy experts and a group of professional and technical talents from all over the country. The joining of these talents is of great significance to Zijin The sustainable and healthy development of the mining industry has played an important role.
The leaders of the Fujian Provincial Metallurgical Department and the Provincial Gold Company as well as Longyan City have also devoted a lot of effort to the development of the Zijinshan Gold Mine. In May 1997, Fujian Gold Company hosted a province-wide gold work conference in Shanghang County. The conference organized delegates to conduct an on-site inspection at Zijinshan Gold Mine, establishing Zijin as a model for metallurgy in the province and greatly enhancing the visibility of Zijin Mining. Leaders from the Fujian Provincial Metallurgical Department, Fujian Gold Company and Longyan City have also visited the Zijinshan Gold Mine many times to inspect and guide the work and help solve various problems. Director Chen Daming of the Fujian Provincial Department of Metallurgy came to the Zijinshan Gold Mine to understand the situation and guide the work. He pointed out that the current new situation of the socialist market economy cannot be viewed from the "mountain people's perspective". In the process of enterprise production and development, there must be The confidence and courage to forge ahead, only in this way can an enterprise truly embark on the path of healthy development. When Longyan Municipal Party Committee Secretary Zhao Juerong and his delegation visited the Zijinshan Gold Mine to inspect and guide the work, they pointed out that the construction of the Zijinshan Gold Mine and the development of Zijin Mining Group have created a unique path for the reform of state-owned enterprises in the old areas of western Fujian, and asked relevant departments to carry out inspections on Zijin Mining. The group company provides strong support in terms of policies, funds and spiritual civilization construction to create a good environment for accelerating the development of Zijinshan Gold Mine and promote faster development of the enterprise. At present, Zijin Mining's gold output accounts for 80% of the entire province of Fujian.
In 2000, Fujian Zijin Mining Co., Ltd. proposed to rebuild ten Zijins in ten years. But rebuilding ten Zijins cannot be achieved by relying solely on rolling development. To rebuild ten Zijins in ten years, we must establish a big development idea and fundamentally solve the corporate system and mechanism problems.
As early as 1997, Zijin people were thinking about how to make the company bigger and stronger, how to solve the problem of the lack of separation between government and enterprises, and how to solve the problem in the minds of managers that "the company belongs to grandpa". When they were engaged in the third phase of technological reform, they clearly stated that they wanted to build a world-class mining company and determined the "three-step" reform and development strategy (i.e., the "old three-step" strategy in the history of Zijin's development, or "Zijin restructuring"). three-step strategy).
The first step is to absorb employees as shareholders and transform the wholly state-owned enterprise into an employee-owned limited liability enterprise, with the state-owned shares reduced to 87%.
This step was completed at the end of 1998. From then on, the fate of employees and the fate of the company were closely linked.
The main reason for this step of corporate restructuring is that employee stock ownership will better supervise the words and deeds of the leadership team. Chen Jinghe said: "If I lose the company's money, the employees will not agree and will come to settle accounts with me." Although the shares held by employees are small, they are of great significance.
The second step is to absorb private elements and establish a joint-stock company. Zijin Mining has introduced Xinhuadu, the largest private department store group in Fujian. Xinhuadu Department Store Group and other private enterprises invested 48 million yuan in cash, accounting for 33% of the shares, becoming Zijin's second largest shareholder.
In the implementation of the second step of the restructuring strategy, Zijin Mining’s state-owned shares were reduced to 48%, retreating from absolute control to relative control; the other two companies accounted for 19%.
After reducing its state-owned shares, Zijin Mining also openly recruited general managers from the public. On July 26, 2000, Luo Yingnan (director level), a government official and manager of Longyan Metallurgical Company, applied for a job and signed a contract to become a senior "part-time worker" of Zijin. Zijin's second restructuring has fundamentally solved the institutional problems that hindered the development of the company.
Introducing private enterprises as strategic investors of Zijin, Zijin leaders believe that finding high-level partners is crucial. Take the shareholder Xinhuadu as an example. Although their main business is department stores, they know Zijin relatively well and are familiar with both parties - Huadu Engineering Company, which contracted the Zijinshan mining project, is a subsidiary of Xinhuadu Group. This company has invested more than 100 million yuan in equipment for mining, and most of the large-scale mining equipment in Zijin Mountain belongs to them.
After private equity participation, the shares of several private enterprise shareholders merged and exceeded the state-owned controlling shareholders. However, they did not send a single person to the management team. They only sent a vice chairman, a supervisor, and a director. They did not participate in the management team, truly realizing the separation of ownership and management rights.
The success of Zijin’s second step of restructuring can be said to be the best result of Zijin’s relationship with the government and is a typical example. Since this restructuring, the characteristics of the Zijin Mechanism have begun to take shape, and the advantages of the Zijin Mechanism have been fully demonstrated.
So what are the characteristics of purple gold?
Chen Jinghe believes that the characteristic of Zijin is that it is neither a completely state-owned enterprise, does not have the shortcomings of state-owned enterprises, and is more dynamic than state-owned enterprises; nor is it a completely private enterprise.
Zijin people believe that the success of this restructuring is inseparable from the support of the local government. For an enterprise like Zijin that is in a period of high growth and a "pillar" of county finance, it is really commendable that the government can allow private capital to come in and withdraw itself.
The third step is to prepare for listing and accumulate funds for corporate expansion. After the second step of Zijin's restructuring was successful, they made clear the goal of listing the company. After careful analysis of domestic gold companies, careful study of modern corporate systems, and combined with the company's own economic strength, Zijin Mining, which never follows the rules, is "whimsical" again this time - they want to be listed in Hong Kong and become one of the strong players such as Lin's high-tech market! Zijin has a series of technological achievements that have reached the domestic advanced level, and some projects have even reached the international advanced level; Zijin has been listed as a "Key High-tech Enterprise of the National Torch Plan" by the Ministry of Science and Technology. All this is in preparation for Zijin’s listing.
One year after the establishment of Fujian Zijin Mining Co., Ltd., Zijin leaders and Shanghang County leaders fully affirmed the huge role of the reduction of state-owned shares in promoting Zijin’s development and believed that the state-owned shares would be reduced from absolute control to relative control. , is the fundamental way to solve the separation of government and enterprises, and is also the most important guarantee for whether an enterprise can truly operate in accordance with the modern enterprise system.
Li Da, deputy general manager, chief economist and doctor of economics of Zijin Mining, commented that wholly state-owned enterprises are appendages of the government. If there is no separation between government and enterprises, the enterprise will have no future. After the restructuring, enterprises kept a certain distance from the government, and then came the issue of financing. The current capital structure of Fujian Zijin Mining Co., Ltd. is a balanced mechanism, and mutual constraints are conducive to the reliability of investment decisions. It is this mutual restraint between Zijin's major shareholders that lays a solid foundation for the company to improve its corporate governance structure and achieve long-term rapid growth.
Zijin Mining’s government relations have enabled the company to obtain an external environment for healthy development, and the company’s rapid development has also attracted the attention of more senior leaders. Since the beginning of the 21st century, the main leaders of the Fujian Provincial Government and the National Gold Bureau have conducted detailed and in-depth inspections of the work of Zijin Mining, solved some practical problems faced by the company, and provided useful guidance for the development of the company. .
When we collected information about Zijin Mining, we discovered an interesting phenomenon. Perhaps in order to brainstorm ideas, promote the development of the company, demonstrate the company's scientific research level, and promote the company's scientific and technological progress, Zijin Mining regularly compiles "Enterprise Development Papers." In 1997, in order to commemorate the third anniversary of the establishment of Fujian Minxi Zijin Mining Group Co., Ltd., Zijin held the "Zijin Mining Reform and Development Seminar" and compiled the papers after the meeting. In this episode, we found that the authors of the most important articles were almost all leaders of Shanghang County’s main functional departments, or leaders of associated companies. But after that, there were almost no government officials among the authors of Zijin's collection of papers.
People may be able to discover something from it.
Strictly speaking, Zijin Mining is not a state-owned enterprise. The government does not provide capital, only a brand, to support Zijin Mining in developing the Zijinshan Gold Mine. As the person in charge of Zijin, with the support of the government, the Zijin leadership headed by Chen Jinghe regards the company as their own, integrates it with the company, and operates it in accordance with the laws of market economy. Although it is an enterprise in a special industry, Zijin rarely reports its work to the government. This may be the specific operation process of Zijin's relationship with the government. The total investment of several hundred million yuan in the first, second, third and fourth phases of the Zijinshan Gold Mine's technical transformation were all decisions made by the company itself and funds raised by itself.
With the support of enlightened local governments, Zijin also made rich reports to society with its brilliant performance. In 2000 alone, Zijin Mining's contribution to local finance reached more than 50 million yuan; in 2003 year, more than 150 million yuan. From 1993 to 2003, the Zijinshan Gold Mine produced a total of 33,586 kilograms of gold, achieved sales revenue of 2.87 billion yuan, a total profit of 920 million yuan, and paid various taxes and state-owned share bonuses of 460 million yuan.
When it comes to the relationship with the government, both Chen Jinghe and Luo Yingnan believe that to become a listed company, a company must be standardized, maintain a certain distance from the government, and not rely on the government.
This is not only the objective demand for Zijin Mining to go public, but also a summary of Zijin’s long-term experience in relations with the government.
The Shanghang County Government has also adopted a "governing by doing nothing" policy for Zijin Mining, delegating power to enterprises and separating government and enterprises. The government does not interfere with the production and operation of enterprises, and only manages the personnel of enterprises. Responsible for managing the chairman and general manager, this makes Zijin Mining's personnel rights and distribution rights basically in place as an enterprise; for the company's financial rights, the Shanghang County Government has also given it to Zijin Mining, and the government only pays taxes to the company. Although Zijin people joke that the government hopes that Zijin will hand over as much as possible, "doing nothing" is actually "doing something". The Shanghang County Government's "governing by doing nothing" has undoubtedly created a good external environment for the development of Zijin Mining. In the end A "win-win" between the government and enterprises has been achieved.
Case studies are more illustrative. Let’s take a look at a typical case of the relationship between Zijin Mining and the government.
From October 12 to 22, 2002, the Shanghang County People’s Government organized a delegation headed by Lai Jiqiu, deputy secretary of the Shanghang County Party Committee and county magistrate, and Lin Xu, deputy head of the county government, as the deputy leader. The persons in charge of the Procuratorate, County Government Office, County Finance Bureau, Urban and Rural Development Administration, Bureau of Land and Resources, Industrial and Commercial Bank of China Shanghang County Branch, Bank of China Shanghang County Branch, Zijin Mining Co., Ltd., Huahui Company and other relevant units and enterprises are Study tour of members. The 12-member inspection team inspected the construction status of Zijin Mining Co., Ltd.'s external investment projects.
After more than ten days of inspection, the inspection team visited Xinjiang Ashele Copper Co., Ltd., Habahe County of Xinjiang Uygur Autonomous Region, and Guizhou Zijin Mining Co., Ltd. Shuiyindong Gold Mine. During the inspection, the inspection team paid condolences to the dispatched employees of Zijin Mining Co., Ltd. who were on the front line of the construction of the Ashele Copper Mine in Habahe County, Xinjiang and the Shuiyindong Gold Mine in Zhenfeng, Guizhou, and conveyed the greetings of the local governments and people He brought Zijin Wanderers who were fighting in a foreign land with concern, and formed a friendly county with Habahe County in Xinjiang, where the Ashele Copper Mine is located.
Located in Habahe County, at the southern foot of the Altai Mountains in the Altay region of Xinjiang, it borders Kazakhstan and Russia. The Aheitubek Port in the county is located on the western border of my country, adjacent to Kazakhstan, and is a national first-class port. The formal signing of the friendship agreement between Shanghang County and Habahe County is undoubtedly of great significance for enhancing the friendship between the two counties, strengthening east-west cooperation, and promoting the construction and development of the Ashele Copper Mine. The Shanghang County People's Government once again took practical actions to create a good environment for Zijin Mining's western development strategy.
This inspection will also provide a huge boost to the relevant departments of the Shanghang County People’s Government. Through the inspection, the members of the inspection team generally felt that they had broadened their horizons and gained knowledge. They had an on-site understanding of the construction content, investment plans, progress speed, social benefits, etc. of Zijin Mining’s external investment projects. They also appreciated the hard work and entrepreneurial spirit of Zijin Mining employees and their Have a deeper understanding and comprehensive and perceptual understanding of the investment location, and master first-hand information.
Through the inspection, the government has a deeper understanding of the strategic significance of Zijin Mining’s foreign investment. They believe that as a resource-based enterprise, Zijin Mining implements a sustainable development strategy of resource possession and technological development. In accordance with the laws of market economy, external expansion and seizing the country's superior resources are inevitable trends. Zijin Mining's investment in the Xinjiang Ashele Copper Mine Project and The investment and construction of the Guizhou Shuiyindong gold mine project has important practical significance for further expanding the scale of Zijin Mining, improving economic benefits, enhancing the company's strength, extending the industrial chain, and achieving the sustainable development of Zijin Mining and even the development of the national gold industry. .
Through the inspection, the government has a deeper understanding of the enterprise. The Shanghang County People's Government spoke highly of the Zijin spirit embodied by the dispatched employees of Zijin Mining. The inspection report pointed out that these dispatched employees were thousands of miles away from their hometowns and stationed in foreign lands with difficult conditions. While they did a good job in project construction and successfully completed the important tasks assigned by the company and the people of Shanghang, they also had to overcome differences in living habits and language barriers. Despite all the inconveniences and difficulties caused by differences in local working methods and methods, they have long adhered to the most difficult front line of production and construction. Due to their dedication, hard work and outstanding work, they have made great contributions to the smooth progress of the company's project construction. It fully embodies the Zijin spirit and style of hard work, innovation, pioneering dedication, hard work, ability to fight hard battles, and Zijin style, and shows a good spiritual outlook for the people of Shanghang in the west.
The relationship between enterprises and the government has become closer, and the sense of identity between both parties has been strengthened.
First of all, regarding the issue of Zijin Mining’s foreign investment, the Shanghang County People’s Government believes that with the development of Shanghang County’s regional economy, the strength of some enterprises has increased, and it has set its sights on investment development in markets across the country and even in The international market is an inevitable trend for enterprises to become bigger and stronger under the conditions of market economy. However, any enterprise, including Zijin Mining, must adopt a positive and prudent attitude when it comes to foreign investment. Before making investment decisions, they should fully consider the policy environment, public security environment, public sentiment environment, market environment and natural environment where the project is located. Resources, etc., only on the basis of sufficient investigation and research can scientific decisions be made. Only foreign investment based on scientific decision-making can truly achieve the purpose of expanding the scale of enterprises, improving economic benefits and achieving sustainable development of enterprises.
Secondly, regarding the principles of corporate investment. The People's Government of Shanghang County believes that any enterprise's foreign investment should adhere to the goal of maximizing profits, and the decision-making of foreign investment must ensure that the enterprise can indeed develop and expand. Otherwise, it is better not to do it. On this basis, the Shanghang County People's Government recommends that Zijin Mining should adhere to the following seven principles when conducting foreign investments: first, the foreign investment projects should be close to the company's main business and industry; second, the investment projects should have resource advantages; third, the investment The project must pursue economies of scale; fourth, the investment environment (policy, natural environment, folk customs, etc.) where the project is located must be good; fifth, the return rate of investment projects should be higher than that of local projects, and the general return rate should be above 30%; sixth, the investment Project partners must be good, the system must be smooth, and the mechanism must be flexible; seventh, foreign investment should take into account the company's internal capital operation and talent training.
Third, the Shanghang County People’s Government has given many constructive and practical suggestions on Zijin Mining’s foreign investment from a macro perspective, such as increasing the intensity of foreign investment publicity and selecting publicity targets. , the adoption of publicity methods, the determination of publicity content, the selection of public relations strategies, etc.; in addition, for some issues related to the development security and overall situation of the enterprise, such as equity issues, the improvement of relevant legal procedures, etc., The governments have given some quite specific suggestions.
In Zijin, you can often feel the pride of Zijin people in their contributions to Shanghang County, and you can also feel the Shanghang County government’s concern and support for Zijin.
This may be the result of the distance relationship between Zijin and the government.