Caught in a whirlpool of public opinion, Lenovo released a brief statement on its intranet on 10 December, stressing that its equity transfer in 2009 did not result in the loss of state-owned assets but instead achieved the preservation and appreciation of state-owned assets.
This is the first time that Lenovo has made a public response following Chinese internet personality Sima Nan’s repeated accusations against Lenovo last month which caused widespread public concern.
But Lenovo’s response has not quelled netizens’ doubts. This is not surprising, given that two camps have formed on the Chinese internet over Lenovo’s controversy. One side is made up of Sima and numerous other internet “Big Vs” (大V) and their followers who refuse to stop attacking Lenovo; the other consists of people who defend Lenovo from time to time — albeit without a leadership figure — and point out that the other camp lacks evidence and are grasping at straws to increase web traffic.
...some personalities who had previously tried to play mediator were either forced to change their stand or have become wary of entering the fray.
It is clear that the camp attacking and questioning Lenovo possesses a stronger online public opinion base. In the comments section of posts related to Lenovo, most netizens show a dislike of Lenovo and demand a thorough investigation of the issues raised by Sima and the rest. On the other hand, the comments section of media personalities who have attempted to defend Lenovo became the target of attacks and the personalities were even repeatedly “cyberbullied”.
Amid the wave of attacks against Lenovo, some personalities who had previously tried to play mediator were either forced to change their stand or have become wary of entering the fray. Even Global Times editor Hu Xijin, who is known for being unafraid to speak up, stopped commenting about the Lenovo issue recently.
Shortly after Sima attacked Lenovo, Hu spoke up on two occasions. He expressed that Sima’s behaviour was reasonable but also tried to make light of Lenovo and founder Liu Chuanzhi’s past scandals. In the main, he urged everyone to come together and look forward. But Hu’s stance angered netizens, who proceeded to bombard his comments section with all kinds of sarcastic remarks and attacks. Over the next few days, no matter what Hu said, many netizens registered their support for Sima in the comments section. Some netizens even posted screenshots and claimed that Hu lost a few million followers within a few days.
Some other Big Vs suffered the same plight as Hu. One of them is communications expert Xiang Ligang, who is also known for being bold in his speech. Xiang claimed that there was nothing wrong with Lenovo’s sky-high salaries and that Lenovo did not cause the loss of state-owned assets but instead created huge benefits for the country. As a result, netizens also targeted and attacked Xiang’s comments section, with some netizens alleging that he was colluding with Lenovo.
On 1 December, Hu changed his position when commenting on the Lenovo incident once again. He said that the high salaries — ranging in the tens to hundreds of millions of dollars — of Lenovo’s senior executives were unreasonable and should be adjusted. He noted that the public’s questioning of Lenovo’s loss of state-owned assets was simple and straightforward and in line with the trend of public opinion which Lenovo must face up to. Hu also pointed out that an authoritative pronouncement on the Lenovo incident must be given by state-owned institution Chinese Academy of Sciences (CAS) or even a higher-level department in charge of the supervision and administration of state-owned assets, which points to Lenovo’s lack of credibility in its own response.
Lenovo may be in deeper trouble
Some feel that Hu’s shift in attitude towards Lenovo is not just to placate fans; it also means that Lenovo has indeed landed itself in deeper trouble. Lenovo’s former agency in charge — the CAS — and the relevant government agencies might step in to resolve the Lenovo incident.
In its statement on 10 December, Lenovo said it had confirmed with the CAS that the CAS’s divestment in 2009 of its 29% equity stake in Lenovo via the Beijing Equity Exchange was legal and in line with regulations on state-owned asset property right transactions with rigorous auditing, appraisal and bookkeeping. And no objections were raised following audits and checks by China’s disciplinary watchdog and state auditors.
Lenovo’s transaction was the epitome of reforming state-owned enterprises and assets. Without these reforms, it would have been difficult for China to achieve the progress it has today.
Lenovo brought up the CAS and state auditing and regulatory agencies in its statement in response to accusations that it was selling off state-owned assets cheaply. However, the statement did not address issues such as the details of the transfer of shares, the high salaries of senior management, and a disproportionate number of foreigners among the senior management.
Perhaps this short statement was the best response that Lenovo could think of to address the public concern that it was selling off state-owned assets cheaply. To be fair, amid the online brickbats, Lenovo would be in an awkward position whether it stayed silent or explained itself; if it said nothing it would be thought of as guilty, but it if said too much it would attract more questions and possibly make things worse, and get itself stuck in an endless debate.
One among many in the process of reforming state-owned enterprises and assets
Many people are calling for the authorities to intervene in the Lenovo case. However, Lenovo’s transaction was the epitome of reforming state-owned enterprises and assets. Without these reforms, it would have been difficult for China to achieve the progress it has today. At the same time, constrained by factors such as the system, market, laws and people of the time, by today’s standards, many companies that were involved in reforming the framework of stocks and shares were all problematic in various ways. Many entrepreneurs were also tainted with some “original sin”, and Lenovo and Liu Chuanzhi are no exception. Besides, despite the steady stream of negative press, Lenovo is still China’s biggest and most successful computer manufacturer.
Lenovo’s plight and helplessness reflects netizens’ frustration over the outflow of state-owned assets, and especially the growing rich-poor gap.
On the other hand, some doubts circulating online about Liu Chuanzhi have escalated to personal attacks, even tagging him as a “traitor”, with some people citing questionable “historical records” to say that Liu’s ancestors were already doing nasty things in the late Qing dynasty. However, Liu Chuanzhi is one of the 100 people identified by the authorities as having made outstanding contributions to reform and opening up. Unless there is solid evidence that Lenovo and Liu have broken the law, it would be difficult for the authorities to investigate them just based on online rumours.
Fundamentally, Lenovo’s plight and helplessness reflects netizens’ frustration over the outflow of state-owned assets, and especially the growing rich-poor gap. This frustration can be seen as necessary regulation of assets, but it may also go out of control and evolve into “involution” that affects social stability.
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