Global Top 500 Chinese Enterprises: Is it “pseudo-large”?

The latest list of the world's top 500 is released, Chinese companies have no suspense and is a thriving scene - 100 Chinese companies are on the list, second only to the United States; Sinopec replaced Exxon Mobil, broke into the top 3, changed For the past three years, Wal-Mart, Shell, and Exxon Mobil have taken the top three positions.

Sorting out the news related to the top 500 list, it is not difficult to find that many companies or local governments where the company is located have regarded the top 500 global brands as a gold sign. However, in the field of research, more and more domestic scholars have reminded that they should not be superstitious in the top 500 rankings. This list with annual operating income as a benchmark does not really reflect the real problems of Chinese enterprises.

Liu Qiao, a professor at Guanghua School of Management at Peking University, bluntly pointed out that entering the global top 500 can only say that the company's operating income is high and its scale is large, but "big" is not equal to greatness. If only the operating income is considerable, but other indicators for measuring the health of the enterprise such as profit and investment capital return rate are not ideal, the “big” is only “pseudo-large”.

Liu Qiao said that although Chinese companies already account for one-fifth of the global top 500, if they want to rank by profit, only seven companies in China can enter the top 50 of the world's most profitable companies, and almost all It is a financial enterprise.

In other words, it is the Chinese companies that have entered the Fortune 500. The most profitable companies are financial companies. The magic weapon for these companies to make money is not based on business innovation, but on the institutional dividend of the financial industry.

Liu Qiao said that among the top 500 Chinese companies, except for the financial performance of seven financial institutions, the performance of a considerable number of companies is not optimistic. For example, Sinopec, which ranks the world's top 500, has a profit of only 8.9 billion US dollars, while its Wal-Mart and Shell, which are in the first camp, have profits of more than 16 billion US dollars.

Some experts have made a calculation. The average profit of 95 companies in mainland China that entered the global top 500 list (the other five from Hong Kong and Taiwan) was 3.22 billion US dollars, lower than the total average of the top 500 companies in the world by 3.91 billion US dollars.

In the 2013 list, the average profit of listed companies in mainland China reached the average of the top 500 companies in the world. Such changes reflect the significant decline in the profitability of Chinese companies in the past year.

Among the top 500 Chinese companies in the world, the most profitable is the Industrial and Commercial Bank of China, whose profits even exceed that of American Apple. However, in Liu Qiao's view, the Industrial and Commercial Bank of China is much more appreciated and respected by people than Apple. He said that when Fortune magazine publishes the top 500 list every year, it will also publish a list of the 50 most admired companies in the world. Apple has ranked first for seven consecutive years.

In addition, it is worth noting that among the 50 most admired companies, American companies still have an absolute advantage. A total of 42 companies are on the list, in addition to the top three Apple, Amazon, Google, and Nike, Microsoft. , Intel, etc. In Asia, one company in Singapore, South Korea and Japan is on the list. So far, no company in China has been selected as the “World's Most Admired Company All-Star List”.

Let's take a look at the top 50 most profitable companies in the Global 500. China has 16 companies, mostly energy-type companies. Enterprises with losses are relatively concentrated in the steel, coal, chemical, and shipping industries that state-owned enterprises gather. Among them, China Railway Materials Co., Ltd., China Aluminum Corporation, and Angang Group Corporation are the top three companies in China.

Other studies have found that the average income of mainland Chinese companies entering the global top 500 list is slightly lower than the total average of the world's top 500 companies, and the average assets are slightly higher than the total average. It is worth noting that the average number of employees in mainland China has reached 190,000, far higher than the total number of employees of 130,000.

Other dimensions such as profit indicators and appreciation are sufficient to show that large-scale enterprises are not necessarily good companies. In recent years, Liu Qiao is still using the indicators of investment capital yield to study the health of enterprises. His research data is that in the past 10 years, the investment of Chinese listed companies per dollar can only bring in after-tax profits of 0.03 yuan, far lower than the investment capital return rate of US listed companies in the past 100 years.

Liu Qiao repeatedly said that multi-dimensional data should be used to judge whether a company is truly powerful, and the ranking of the global top 500 should be treated rationally. He said that according to the ranking of operating income, at most, it is ranked in the top 500. The true global top 500 should be the comprehensive ranking of sales revenue, net profit, influence, brand and core technology. Although Chinese companies are growing rapidly in scale, there are still many issues worth worrying about.

In Liu Qiao's view, on the other hand, Chinese companies entering the list can also see that the development structure of Chinese companies is not reasonable. The enterprises on the list have two characteristics, one is that there are many state-owned enterprises, and one is an energy resource enterprise. Such corporate structure characteristics also correspond to China's current economic structure.

In 1996, only two companies in China were able to enter the Global 500, and in 18 years, 100 companies in China entered the Global 500. Liu Qiao said that these big companies can benefit from the high-speed forward Chinese economy express. Looking at the Chinese economy in the past 18 years, investment, exports, and consumption of the three carriages that drive economic growth have contributed the most. The investment-driven economy, energy, basic raw materials, capital and other production factors are extremely strong, which has given birth to the global top 500 enterprises, Chinese enterprises in the energy sector, steel sector, building materials sector, banking sector, a sudden rise, and mostly " The enterprise of the word "country".

Liu Qiao said that among the top 500 Chinese companies, state-owned enterprises and resource-energy-based enterprises account for nearly 90% of the total. It also shows that state-owned enterprises have absolute dominance in the upstream sector of China's economy, and on the other hand, they also reflect investment. The Chinese economic growth model makes the upstream sector more prone to large-scale enterprises.

At present, China's economy is facing transformation and structural adjustment. Liu Qiao said that only when Chinese enterprises complete the transformation can they really drive the transformation of China's economy. In the 30 years and 40 years since the reform and opening up, Chinese enterprises have already achieved the "big" creation. In the future, the second long march from "big" to "great" is needed. From the past, we simply focus on the scale of the enterprise, and pay attention to corporate profits and investment. Capital yields, etc., on the one hand, require companies to find innovative modes of experience, and on the other hand, changes in social support systems.

Liu Qiao believes that the social support system includes the government's transformation of functions, the realization of the role of decision-makers from economic life to the role of public service providers; financial reforms are further enhanced to more support the development of dynamic SMEs.

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