Industrial And Commercial Bank of China: The Governance Model Harvard Case Solution & Analysis

IMD-1-0335 © 2012
Cossin, Didier; Lu, Abraham Hongze

(This is a brief version of case IMD-1-0327 Industrial and Commercial Bank of China: Governing Lessons from East to West. For more information, please refer to the full length instance.) But, thanks to the combined efforts of the management team the government and its particular workers, the bank rose from the ashes through a transformation in its governance structure. This case describes the government model, including the inner workings of the investors, the board of directors, the board of the communist party committee, the senior management team, managers, outside monitoring and discipline of ICBC.

The discussions are applicable to Western firms when it comes to understanding the corporate governance structure adopted by big Chinese enterprises. The success of its unique governance structure and the bank bring much inspiration from East to West. Learning objectives: At board and executive level, participants can concentrate on the banking governing arrangement and also the pros and cons of the ICBC system. By the end of the course conversation, participants ought to be able to comprehend the problems arising from conflicts of interest among regulators, managers, supervisors, the management team, the communist party and investors. They should also understand the inner workings of these stakeholders, in particular the incentives of each and every stakeholder group which differ significantly from those in the West. The discussions borrow elements that may be useful and offer participants the opportunity to reflect on governance practices that are Western.

Subjects: Governance; China; Banking; Banking reform; Emerging markets; Corporate governance; Chinese governance; Board structure; Communist party; State owned enterprise
Settings: China ; Banking ; ICBC operating income in 2011 RMB 470.6 billion (US$70.7 billion) ; 2011

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