Dahua CEO Is Communist Party Secretary, Declares "Always Follow The Party"
Dahua CEO Fu Liquan, the Secretary of Dahua's Communist Party Committee, declared "always follow the Party" in a 2018 speech that effusively praised the Party and credited its "correct leadership" for Dahua's success.
Dahua has been keen to emphasize it is "not a government-owned entity" (unlike competitor Hikvision) but these remarks show Dahua's close relationship to the PRC's governing party. This also undermines Dahua's efforts to distance itself from the government after a state-owned firm bought a ~10% Dahua stake earlier this year.
Dahua defended Fu's comments to IPVM as "standard" practice in China saying this was no different than US CEOs praising a US President, attributing any difference to "cultural norms", despite the vast difference between the PRC's single party-led state and the US.
Party Secretary Fu Joins "Red Power" Meeting
In December 2018, Zhejiang University's business school posted about a meeting co-organized by Dahua's Party Committee (Fu, circled below, is a graduate of Zhejiang University's executive MBA program). The meeting, titled "Red Power, Strong Companion" was about private sector "cooperation" with the Party:
The post (along with Dahua itself in 2016) stated that Fu is the Secretary of Dahua's Communist Party Committee. This is common in PRC companies, for example, Hikvision's chairman is also its Party Secretary. Australian think tank ASPI was the first to find the Zhejiang University post in its Dahua company profile.
"Always Follow The Party"
During the meeting, Fu Liquan "emphasized the correctness" of "always follow the Party" ( "永远跟党走", a Party slogan):
Chairman Fu Liquan was excited in his speech and brought a wonderful Party lesson to the participants. First of all, from the perspective of personal destiny, the fate of private enterprises, and the fate of the country, he emphasized the correctness and determination of the orientation of "always follow the Party" [emphasis added]
Fu credited Dahua's success to the Party's "correct leadership", boasting that Dahua "never slacked on Party building":
Over the years, we never slacked on Party building work. That's exactly why Dahua can maintain a high growth rate and always practiced the dream of "serving the country through industry" in the context of increasingly fierce international competition and rapid change; it is precisely because of the correct leadership of the Party that [Dahua] jumped out of the "farm's gate" [i.e. contributed to China's industrialization] and built this business from scratch. [emphasis added]
Dahua's CEO even compared the Party and Xi Jinping Thought the Buddhist 'Great self' (大我) concept, one of the last stages on the path to enlightenment (Nirvana):
Fu Liquan said he has felt more and more of the power and greatness of the Party's "Great self" ever since Xi's Thought and proposition of "A community of shared future for mankind" and what Xi spoke highly of in the November 11 seminar about the contributions made by private companies over the past 4 decades of China's reformation. This has built up his confidence by multiple times, he said. He expressed the firm path on sticking to the party's leadership, sticking to the spirit of innovation, focusing on the smart IoT industry with video surveillance as the core, realizing the firm's mission actively and contributing to the fight for China dream fulfilling the great rejuvenation of the Chinese nation [emphasis added]
Most of the Party slogans and concepts Dahua's CEO cited are directly from Xi Jinping, such as "China dream" (中国梦;), the "Great Rejuvenation of the Chinese Nation" (中华民族伟大复兴), and "Always Follow The Party" (永远跟党走),
"Political Work" A "Top Priority"
Fu was pictured in front of a Dahua slideshow that listed the "The Key Implication Of Private Companies' Party Building Work", including:
- Put the political work at the top priority of private companies' Party building work
- Arm our minds with Xi Jinping's 'Thought on Socialism with Chinese Characteristics for a New Era'
- Enhance private companies' Party building organizational work
The rest of the text was too blurry for IPVM to interpret. The pin Fu is wearing in the photo above is a Communist Party pin, as Dahua employees wore in a 2019 video.
Dahua Touts "Smart Party Building Solution"
In a separate July 2019 post on Dahua's own website, Dahua touted it had built an integrated "Smart Party Building Solution" for companies' Party building activities, including "propaganda", "supervision", "learning", etc:
The scheme integrates video surveillance, face recognition, big data, cloud computing, Internet of Things and other technologies, with its powerful, excellent quality of the complete product system, to create a set of Party affairs management, Party building supervision, Party building propaganda, Party group services, Party members work and learning as one of the integrated Party building work collaborative management system. The system can build smart party building projects for Party organization organs all over the country, build a smart party building platform in the era of mobile Internet, and let Party building work move with the trend and upgrade wisdom in the flood of scientific and technological development. [emphasis added]
This post was also first found by ASPI. At the Zhejiang University meeting, Fu inaugurated the launch of the "Smart Party Building" solution for the University's Party Committee, but IPVM could not find more public information about it. Dahua told IPVM this was a "standard commercial solution" and compared it to US tech embedding staff on presidential campaigns:
As for the solutions Dahua sold to Communist party customers, here too, there is nothing remarkable. This was a standard commercial solution which is available for various customers and is in line with the company’s code of business conduct. For comparison, U.S. businesses of course routinely provide goods and services not only to government buyers, but to political parties as well. Famously, Google, Facebook and Twitter went so far as to embed their own employees in President Trump’s campaign offices to support their efforts to use those platforms. [emphasis added]
The difference is that, unlike in the PRC, US big tech companies do not explicitly pledge fealty to one Party or another and provide services for all political campaigns that follow their terms of agreement. The PRC is explicitly "under the leadership" of the Communist Party of China, PRC state media says, and PRC companies must "Always Follow The Party" as Fu stated.
Dahua Previously Distances Itself From Government
This is notable since Dahua's main competitor Hikvision is directly state-controlled, which Dahua explicitly pointed out in reaction to the NDAA ban by saying it was "not a government owned entity" (Dahua Ban Response: NOT Chinese Government Owned).
Dahua also defended state-owned firm China Mobile acquiring 10% of its shares earlier this year by saying "we are a private sector business" and "we serve our shareholders, customers and employees - not the interests of any government".
Dahua Response: "Common Practice"
IPVM asked Dahua whether the above information raises questions about Dahua's independence from the PRC government. In response, Dahua sent the below statement that while the PRC has its own "unique legal and cultural norms", CEOs praising governments is "common practice":
IPVM’s questions consistently reveal a profound lack of awareness of the norms of Chinese business practices, and serious deficiencies in understanding the realities of normal business practices in the U.S.
The practices described by IPVM are standard activities for private enterprises in China. These practices differ somewhat in form, but very little in substance from those routinely exhibited in the U.S.
Firms operating in China, regardless of their nationality, must abide by Chinese company law. Microsoft China, Ford Motors China, Nokia Shanghai, and Bosch Power Tools, among countless others, have party representatives in senior management positions in accordance with law.
To be specific, Dahua’s CEO has in fact praised the Government of China, the ruling party and its leadership. Of course, business leaders praising government, the party in power, and its leadership is common practice – not just in China, but worldwide. Since his inauguration, President Biden has received effusive praise from CEOs. Many, if not most of those CEOs lead companies that sell goods and services to the U.S. government, and to state and local law enforcement. That does not change the fact that these companies are private enterprises.
It is also worth noting that many American CEOs have had words of praise for the Chinese government. Just recently Elon Musk called the government of China, “very responsible”. Musk’s personal views do not make Tesla or SpaceX an apparatus of the PRC.
Dahua does not hide the fact that our CEO is a member of the Communist Party. Again, this is normal in China. Our CEO’s position is unexceptional among China’s leading companies. Indeed, multinationals like Ford, Microsoft and countless others with operations in China also have senior executives who are Communist Party officials. While this is different from normal practices in the U.S., the fact is that some of this nation’s most important business leaders are registered members of political parties, donate personal funds to those parties and leverage their enterprises to support those parties.
As for the solutions Dahua sold to Communist party customers, here too, there is nothing remarkable. This was a standard commercial solution which is available for various customers and is in line with the company’s code of business conduct. For comparison, U.S. businesses of course routinely provide goods and services not only to government buyers, but to political parties as well. Famously, Google, Facebook and Twitter went so far as to embed their own employees in President Trump’s campaign offices to support their efforts to use those platforms.
The bottom line is that the relationship between governments, parties and private business is always and everywhere complex and symbiotic. China has its own unique legal and cultural norms that shape business practices, as does the U.S. Rather than falsely alleging that China’s norms somehow mean virtually every company there is state-directed, we should try to understand each other better, and acknowledge that private businesses can operate in different ways in different places yet still serve the same purpose of creating value for shareholders, employees and other stakeholders.
Citing the CEOs of Goya Foods and Oracle supporting President Trump, Dahua said "expressing these views does not mean these businesses are somehow state-directed":
It once again appears that you are simply refusing to acknowledge normal cultural differences between societies.
Certainly, the words used by our CEO and countless other CEOs and business executives in China - including those employed by US-based multinationals - would be unusual or even inappropriate in other national contexts.
The same is absolutely the case for US norms. In just the past few years, Goya Foods CEO Robert Unanue said “We’re all truly blessed at the same time to have a leader like President Trump who is a builder…we pray for our leadership, our president.” Before he was even inaugurated, Oracle CEO Safra Catz said she planned to tell Trump at an upcoming meeting, “[W]e are with him and are here to help in any way we can.”
Again, we offer no criticism of these words. These are just normal forms of praise routinely offered by CEOs around the world for their host nations’ governments and parties. Expressing these views does not mean these businesses are somehow state-directed. Rather, they reflect the nuanced relationship between business, government and parties that exist everywhere.
Misleading To Compare US & PRC
It is misleading to compare US CEOs praising a President to Fu Liquan's comments because the governments of the PRC and the USA are vastly different. The PRC's political parties are all "under the leadership" of the Communist Party of China, PRC state media says.
The few China CEOs who criticize the CPC are generally subject to punishment. Ren Zhiqiang, a real estate billionaire who criticized China's COVID response, was jailed for 18 years. Alibaba founder Jack Ma criticized PRC banking regulators and wasn't seen in public for months, with his plans for a huge IPO nixed.
In the US, by contrast, many CEOs criticize the Party in charge, and CEOs who criticize a previous administration are not arrested or otherwise punished.
The difference is not "cultural norms" but actual PRC policy which fundamentally undermines PRC companies from being independent of the party. 'Always Follow The Party' reflects the way the CPC views all spheres of activity in China, with General Secretary Xi Jinping himself stating, "Party, government, military, civilian, and academic, north, south, east, west, and center, the Party leads everything" [emphasis added]. In the US, CEOs and others are widely free to support or oppose political parties.
IPVM sent the above response to Dahua, if they respond, we will update.
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