State-owned enterprises are an important material and political foundation for socialism with Chinese characteristics, and an important pillar and strength for the Party to govern and rejuvenate the country. Since the 18th CPC National Congress, General Secretary Xi Jinping has made a series of important speeches and instructions on the reform and development of state-owned enterprises from the strategic perspective of the overall development of the cause of the Party and the country, emphasizing that "state-owned enterprises are an important force for strengthening the comprehensive strength of the country and safeguarding the common interests of the people. "We must unswervingly deepen SOE reform," which has charted the course for the reform and development of SOEs.

The 14th Five-Year Plan period is the first five-year period when China embarked on a new journey to build a modern socialist country in an all-round way. Based on the new stage of development, the new vision for development, and the new pattern of development, state-owned enterprises (SOEs) play an important role. We must be bold enough to shoulder heavy burdens, be bold enough to innovate, promote high-quality development through deepening reform, and stay committed to making state capital stronger, better and bigger. The three-year action plan for SOE reform (2020-2022), deliberated and adopted at the 14th meeting of the Commission for Deepening Overall Reform of the CPC Central Committee, sets out a timetable and roadmap for SOE reform. To implement the action plan, in perfect modern enterprise system and improve the market management mechanism with Chinese characteristics, deepen the reform of the mixed ownership power, and promote comprehensive reform, is the implementation of the party central committee with comrade xi for the core of the inevitable requirement of deepening the reform of state-owned enterprises decision deployment, but also the realistic need, which the further stimulate the endogenous dynamic of state-owned enterprises.

Accelerating the improvement of the modern enterprise system with Chinese characteristics is an important foundation for stimulating the vitality of state-owned enterprises. General Secretary Xi Jinping stressed: "We will focus on innovating systems and mechanisms, speed up the establishment of a modern enterprise system, give full play to the enthusiasm, initiative and creativity of all types of personnel in SOEs, and stimulate the vitality of various factors." This requires SOEs to improve their market-based operation mechanisms and deepen reform of the labor, personnel and distribution systems to stimulate vitality and improve efficiency. We will improve the governance structure of SOEs, continue to promote the building of the board of directors, and explore contractual management of the tenure system for managers. We will move faster to improve market-based operating mechanisms, and give priority to supporting commercial sub-enterprises in accelerating the implementation of a professional manager system. We will further improve the salary incentive mechanism, comprehensively promote market-oriented employment, promote market-oriented reform of the salary system and the distribution mechanism, optimize the control of total payroll, and explore the shareholding of employees and the sharing of excess profits to further stimulate the vitality of officers. We will further improve the mechanism for performance appraisal and the application of appraisal results, and provide medium - and long-term incentives of various forms flexibly. We will continue to improve systems and mechanisms conducive to market-oriented transformation, strike a balance between reform, development and stability, and ensure high-quality development of enterprises through efficient governance.

To improve the modern enterprise system with Chinese characteristics, we must adhere to the principle of "two, one, and the other". The Party's leadership over state-owned enterprises is a major political principle and must be followed consistently. The establishment of a modern enterprise system is the direction of the reform of state-owned enterprises, and we must continue to do so. We must unswervingly strengthen the overall leadership of the Party, give full play to the leading role of Party organizations in guiding the direction, managing the overall situation, and ensuring implementation, and give full play to the status and role of Party organizations in corporate governance structures, so as to ensure that reform moves forward in a steady and orderly manner under the leadership of the Party. To combine the reform of the three systems with the encouragement of accountability, we need Party organizations at all levels to take responsibility for those who take responsibility, support those who do work, and establish and improve a fault-tolerant mechanism for reform and innovation. We will step up efforts to identify and select officials through reform and innovation to provide a strong guarantee for upholding reform and encouraging innovation. To combine the three system reforms with the production and operation of enterprises, it is necessary to take targeted reform measures around the problems existing in the operation and management of enterprises, constantly improve the operation and management system of enterprises, and promote the high-quality development of enterprises.

Source: State-owned Assets and Administration Commission of the State Council