Case Analysis Of Alibaba Partnership

Under the new situation of development, corporate governance has entered a new stage, starting from passive compliance towards active innovation. Under the precondition of abiding by the rules of the necessary mandatory governance, many companies begin to explore and innovate the corporate governance system that meet their development needs, in order to improve the efficiency of management and achieve the purpose of governance. Alibaba Group is a model that innovates corporate governance system. For the special purpose of the corporate governance, it innovates Alibaba Partnership according to its actual situation. Alibaba Partnership introduces the concept of "partner", and empowers them to nominate the majority of the board directors through the company’s articles of association and relevant agreements, so that they obtain the actual control of company in the case of holding a small amount of shares. Its biggest characteristic is that control and stake is irrelevant, namely ignoring equity.This paper analyzes Alibaba Partnership in the form of case comprehensively. Following the introduction of Alibaba Group overview, the paper carries on the detailed introduction of Alibaba Partnership from the concept, generation, conditions, powers and duties, quit, and the current constitution, and also compares it with the traditional partner system and Dual-Class shares structure respectively. After having a better understanding of the content of Alibaba Partnership, the paper analyzes its advantages and defects. The advantages of this system mainly include:ensuring the management control effectively in the long run; reducing the cost of senior management to get the control; conducive to play the role of human capital; avoiding the dictatorship of founder; conducive to the company’s stability and long-term development. And its defects mainly include:the conditions of the partners are not clear enough; nomination deadlock may occur; controller risks may happen; powers of ordinary shareholders are subject to greater restrictions, etc. This article also focus on the shareholder’s attitude towards the system, thus analyzes the reason why the ma insists the system and why Softbank, Yahoo, and American investors accept the system. Based on the above analysis, this paper proposes improvements for Alibaba Partnership, and analyzes the conditions that other companies learn and use the system. The last part of this paper discusses the inspiration of Alibaba Partnership for enterprises and regulatory authorities, and puts forward some policy suggestions, that is, to establish the board of classified equity timely, and establish and improve the related mechanisms.