The Study Of Mixed-Ownership In Chinese Stated-Owned Enterprises

The Third Plenary Session of 16th CPC Central Committee present clearly that we must vigorously develop a mixed ownership economy, the state capital, collective capital and private capital can exchange share with others. Furthermore The Third Plenary Session of 18th CPC Central Committee set the mixed ownership as the basic principle of reform of State-owned Enterprises. State-owned economies and other private entities are encouraged to develop into a mixed ownership economy. The government also encourages non-public enterprises to participate in State-owned enterprises' reform, encourages the development of mixed ownership of non-public-owned enterprises, and encourages qualified private enterprises to establish a modern enterprise system in mixed ownership reform. At the same time, the government also allows mixed ownership economy to implement ESOP in order to keep capital owners and workers as a community of interests.This paper mainly investigates the case of mixed ownership reform of WuMing PolyMining Co.,Ltd by applying game theory as the main method to analyze the reform in three different stages:the initial mix, mix reform process, and the future reform. Due to differences in the positions and interests of the various stages, the different stakeholders game sharply to find the optimal solution to achieve acceptable interests of all parties. And the paper also proposes appropriate corporate governance models according to the several possible shareholding structure and operating situations of the future mixed operations. Through this case study, we found that mixed ownership is playing a positive role in the reform of state-owned enterprises. All stakeholders need to intermingle with keeping their strengths and advantages, in order to make more interests, which is the aim of mixed reform, and the power to reform further. There will be a lot of problem nobody can predict during the process of reform, as long as all the parties can keep the reform in the right way even by giving up some benefits at the crucial moment, ultimately they will succeed in the reform of mixed ownership.