Chinese enterprises’ globalization ‘big in scale but weak’: Accenture

May 19, 2013 Leave a comment

Chinese enterprises’ globalization ‘big in scale but weak’: Accenture

Staff Reporter

2013-05-19

The globalization of Chinese enterprises has been “big in scale but weak,” Claire Yang, head of Accenture’s Greater China talent and organization service line, was quoted May 14 in a report on the caixin.com Chinese business news website.

In terms of business scale, direct overseas investments made by Chinese enterprises touched US$77.2 billion in 2012, posting a growth rate of more than 20 times the levels seen less than a decade ago, the report said.

However, the global percentage of Chinese foreign investments remained at a low level compared with other countries. An Accenture report indicated that in 2011, capital flow involving Chinese direct foreign investment accounted for 16% of that of the United States and 57% of Japan, and was ranked the world’s ninth largest.

The ratio of Chinese enterprises overseas revenue was low. Using Standard and Poor’s 500 index, the average overseas revenue recorded for an enterprise accounted for 27% of the total the enterprise generated in a year.Nevertheless, among the top 500 Chinese enterprises, the percentage of overseas revenue averaged 14.13%.

Chinese enterprises must still work to improve their brand exposure and influence in the international market. The degree of globalization in their top management is relatively low compared with their foreign counterparts.

Data showed that 22% of high-ranking managers at Chinese enterprises had a foreign educational background and 17% of such executives had worked overseas. In foreign enterprises, the percentage stood at 36% and 86%, respectively.

The overall globalization level of Chinese enterprises remains in a preliminary phase. The degree of maturity is still low, Yang said.

Filed under Macro Trends

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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