Eldest Sons of the Republic: State-owned Enterprise Executive Management System with Chinese Characteristics

Abstract Some cadres receive promotions, whereas others do not. This study explores the Chinese Communist Party’s (CCP) personnel control over the central state-owned enterprise (SOE) leaders from the Hu era to the Xi era. An analysis of the résumés and careers of SOE leaders reveals that the CCP has established a dual-track system to manage enterprises with different functions. This system employs two types of incentives: promotion incentives for leaders of eldest-son enterprises associated with national security, and salary incentives for leaders of other enterprises. Through the dual-track system, the CCP aims to influence the career trajectories of SOE leaders and address conflicts of interest in the principal-agent relationship. This study also investigates the individual characteristics of SOE leaders, including their political qualifications, professional qualifications and ages. The results indicate a tendency towards specialization and institutionalization in central-enterprise leaders, even during the Xi era.