Recently, the central bank agreed to the completion of Alipay (China) to complete the change to no actual controller, which means that Ma Yun officially let go of Alipay and no longer exercises control over it. As a wholly-owned subsidiary of Ant Group, Alipay has also completed the transformation from having an actual controller to not having an actual controller. This change is undoubtedly a milestone and indicates that China's Internet corporate governance has entered a new stage.
1. Alipay has no background of actual controller
At the end of 2020, in the context of the "selective confiscation" of the Internet platform by the regulatory authorities, Ant Group, controlled by Jack Ma, was required to rectify, and then the shareholding structure of Ant Group changed, and Jack Ma's control over Ant through concerted actors was broken, and Ant Group officially entered the era of no actual controller.
Alipay, a wholly-owned subsidiary of Ant Group, has also changed from the era controlled by Jack Ma to a new era with dispersed equity and no actual controller. It can be said that this is a milestone moment in the history of China's Internet companies, and it heralds a new chapter in the governance of China's Internet companies.
2. The meaning of no actual controller
What does it mean to have no actual controller?To put it simply, the company does not have a situation where the company holds more than 50% of the shares and actually controls the company, and no shareholder can decide the company's business policy and appoint and dismiss senior executives through an agreement.
Specifically, the conditions to be met by a company without an actual controller include:
1. The shareholding ratio of any shareholder is less than 50%.
2. The shareholding ratio of the company's largest shareholder is less than 1 3.
3. No shareholder of the company can decide the company's business policy and appoint and dismiss senior executives through an agreement.
4. The company has a sound corporate governance structure and rules.
In other words, a company without an actual controller has a dispersed shareholding, and any shareholder must vote according to its shareholding ratio, and no one can dominate the company's business decisions. This is actually more in line with the governance logic of modern enterprises.
3. Analysis of the impact on Alipay
Alipay's completion of the transformation to no actual controller, what impact will it have on itself?It is not difficult for us to find that the essence of this change is the change of control of Alipay from Ma Yun personally to the collective shareholder.
1) Shareholder power is decentralized, and corporate decision-making is more scientific.
In the past, although Alipay had multiple shareholders on the surface, the actual control was concentrated in the hands of Jack Ma. After this change, no one can dominate the company's decision-making, and shareholders must vote according to their shareholdings.
This is conducive to Alipay's development direction, personnel appointments, and major decision-making are more scientific. Because these decisions need to be discussed by various shareholders before they can be made, they will not be decided by Jack Ma as before. The decentralization of power of shareholders is also conducive to shareholders' supervision of the company.
2) The company's operation and management system remains unchanged.
Some people may worry that without Jack Ma as the controller, Alipay's operation will fall into chaos. This worry is unwarranted. We know that in order to complete the transition to no actual controller, the company must have established a sound corporate governance structure and system before it can obtain the consent of the regulatory authorities.
This means that Alipay's daily operation and management system will remain highly stable. There are mature mechanisms and systems for the appointment and removal of key positions, business adjustments, and risk control, and there will be no operational disruption or management chaos.
3) Regulatory policy dividends.
In the current environment of regulatory policy guidance to encourage standardized operation, Alipay has completed the transformation of no actual controller, which means that it is highly consistent with the regulatory direction. This may allow Alipay to increase regulatory certainty and gain more support for business applications or new initiatives.
The absence of an actual controller helps to reduce the concerns of the regulatory authorities and allows Alipay to enjoy policy dividends. This will also promote the more standardized and healthy development of Alipay.
IV. Concluding remarks
To sum up, Ma Yun let go of Alipay and let it officially enter the era of no actual controller, which is a new stage in the development of China's Internet enterprises. It actually makes Alipay's shareholder power more decentralized, corporate decision-making more scientific, and at the same time the operation and management system remains unchanged, and enjoys the dividends of regulatory policies.
The absence of an actual controller does not mean chaos and uncertainty, on the contrary, it may lead Alipay towards a more standardized and transparent operating model. We also look forward to seeing more outstanding Internet companies complete this important transformation and mature in the future.