New Economy Forum
Jack Ma Cedes Alibaba Licenses. Investors Won’t Get Control
- Co-founder will give up control over Alibaba legal entities
- Restructuring brings more stability, but no long term solution
This article is for subscribers only.
Jack Ma is quietly giving up control over the legal entities that control Alibaba Group Holding Ltd. in a move aimed at reassuring shareholders of their rights in China’s most valuable company. It’s also a reminder of weaknesses in corporate governance at the country’s biggest companies.
Ma, who said he plans to retire from Alibaba next year, is surrendering control over the variable-interest entities, or VIEs, that hold the company’s business licenses. Those licenses will be distributed among the company’s top executives, spreading authority more broadly and decreasing the risks that one or two people would have undue influence over the business.