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Foreign firms unprepared for China's 'life-or-death' rating system: chamber

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5 years ago

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Foreign businesses in China are ill-prepared for the tough sanctions and constant surveillance demanded by a social credit system to be rolled out this year, a European business group warned Wednesday.
Under this new system for ranking businesses, both foreign and domestic companies will be required to install surveillance cameras in their premises and share the data with the government.
They will also be rated on their tax record and compliance with a range of existing laws, including customs or environmental regulations.
Those who violate rules will be placed in “blacklists” and subjected to “immediate and severe punishments”, the EU Chamber of Commerce in China said in a report published Wednesday.
The sanctions are not limited to penalties but also include more frequent inspections, customs delays, not getting subsidies or tax rebates and public shaming, the report added.
“The corporate social credit system could mean life or death for individual companies,” said Jorg Wuttke, president of the EU chamber.
“The overwhelming absence of preparation by the European business community is deeply concerning.”
Each company operating in China is already being assessed against at least 300 different “specific rules” ranging from emissions levels to workplace safety and complaints against their products on e-commerce platforms, government documents showed.
“Beijing plans to combine all these different ratings into a single database by the end of the year,” said Bjorn Conrad, head of the Berlin-based consultancy Sinolytics that co-authored the report.
A single score could mean that a company is penalised across China for a slip by one of its regional branches.
Companies will also be rapped for working with suppliers or partners with bad social credit.
The system will also involve the unprecedented demand that all businesses have to install surveillance cameras in their premises and transfer huge amounts of data and footage to government officials.
“Dozens of companies have raised concerns about the sheer volume and depth of data that needs to be shared with the government,” said Conrad.
“They are worried about how this data will be handled and whether business secrets will be leaked.”
Rewards for being a good corporate citizen include easier access to loans and faster government approvals — although they are very few in comparison to the penalties.
Foreign companies in China often complain about the lack of a level playing field, especially when local officials turn a blind eye to rule violations by domestic rivals.
But European companies, which often have better compliance in areas such as pollution and workplace safety, can actually benefit from the system where scores and ratings are calculated automatically, the EU chamber said.
The term “social credit” has made foreign firms jittery because it is also associated with another sprawling Chinese system that aims to rate individuals based on a set of government-defined criteria.
– AFP

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Asia

Up to 200 athletes tested for doping so far at Asian Games

Between 150 and 200 Asian Games athletes tested for doping, yielding no positive results. Anti-doping efforts emphasized for a clean event, focusing on record-breakers.

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1 year ago

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25 September 2023

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HANGZHOU, CHINA — Between 150 and 200 Asian Games athletes have already been tested for doping, the Olympic Council of Asia said on Monday, with no positive results so far.

Speaking at an anti-doping press conference on the second full day of the Games in the Chinese city of Hangzhou, the OCA said dope-testing was “gaining momentum” at the event.

Mani Jegathesan, an adviser to the OCA anti-doping committee, warned that drug cheats would be rooted out.

Up to 200 athletes have been tested so far, he said, but any positive results will take several days to come through.

“Every athlete participating in these Games must understand that they could be picked at any time,” Jegathesan warned.

“That is the best step to ensuring we have a clean event.”

There are about 12,000 athletes at the 19th Asian Games, more competitors than the Olympics, and Jegathesan admitted it would be impossible to test them all.

Instead, they will prioritise, including picking out those who break world or Asian records.

— AFP

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Foodpanda’s restructuring amid sale speculations

Food delivery giant Foodpanda, a subsidiary of Delivery Hero, announces staff layoffs in the Asia-Pacific region, aiming for increased efficiency. This move coincides with ongoing talks about potentially selling parts of its 11-year-old business.

Published

1 year ago

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24 September 2023

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Foodpanda, a subsidiary of Delivery Hero, is initiating undisclosed staff reductions in the Asia-Pacific region, as discussions continue regarding the potential sale of a portion of its 11-year-old food delivery business.

In a memorandum circulated to employees on 21 September, Foodpanda CEO Jakob Angele conveyed the company’s intent to become more streamlined, efficient, and agile.

Although the exact number of affected employees was not disclosed, the emphasis was on enhancing operational efficiency for the future.

No mention was made in the memo regarding the reports of Foodpanda’s potential sale in Singapore and six other Southeast Asian markets, possibly to Grab or other interested buyers.

Foodpanda had previously conducted staff layoffs in February and September 2022. These actions come as the company faces mounting pressure to achieve profitability, particularly in challenging economic conditions.

The regulatory filings of Foodpanda’s Singapore entity for the fiscal year 2022, ending on 31 Dec, indicated a loss of S$42.7 million despite generating revenue of S$256.7 million.

Angele further explained that Foodpanda intends to review its organizational structure, including both regional and country teams, with some reporting lines being reassigned to different leaders. Additionally, certain functions will be consolidated into regional teams.

Expressing regret over the challenging decisions, Angele assured affected employees of a severance package, paid gardening leave, and extended medical insurance coverage where feasible.

Foodpanda will also forego the usual waiting period for long-term incentive plan grants, and vesting will continue until the last employment date. Employees will retain all vested shares as of their last day of employment.

Foodpanda, established in 2012 and headquartered in Singapore, became a part of Delivery Hero in 2016. The company operates in 11 markets across the Asia-Pacific region, excluding its exit from the Japanese market last year.

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