China's SOE Executives: Drivers of or Obstacles to Reform?

Drawing on a database tracking the career of 1,250 top Chinese executives from 1,084 publicly-listed state-owned enterprises (SOEs), this article analyzes differences in career incentives for subsidiaries controlled by the central government compared to those controlled by local governments. It also considers the differences for executives in listed companies close to the parent group compared to those that are heads in distant subsidiaries. We find that in both SOEs and their publicly listed subsidiaries, administrative experience or political connections appear to increase the likelihood of promotion. However, in the case of central SOE subsidiaries, leaders are more likely to be promoted based on financial performance. For both central and local 'direct' SOE groups age is a significant negative factor for promotion, whereas tenure is a significant positive factor.