State Owned Enterprise

2217 Words9 Pages
1 CHAPTER 1 INTRODUCTION
1.1 BACKGROUND OF THE STUDY The term of ‘state-owned enterprise’ (SOE) refers to fully state-funded firms and the ‘state-holding enterprises’ (SHE) is such that they are those firms whose majority shares belong to the government (World Bank, 2013). In China, SOEs are wholly or majority-owned by the Chinese central, provincial, county or municipal government. This broad definition of SOEs reflects privatization reform since the 1990s. China has stunningly triumphant for its transition from a command economy to a market-oriented economy and for its transition from a rural agricultural society to an urban industrial one (Zhao, Ning and Yu, 2010). However, China’s economic transition has been negatively influenced by its underdeveloped National HRD and HR capabilities within enterprises. Therefore, reforming China’s SOEs has become a top priority after the Third Plenum of the Chinese Communist Party’s 18th Congress and the National People’s Congress. The state has been introducing a series of policies, regulations and initiatives that are intended for developing the national human capital. These measures include formal education programmes, state-sponsored skill development programmes at the national and enterprises’ levels, as well as organization training initiatives. China has moved steadily towards formulating a nationwide policy of developing HRD and adopting practical measures of implementation. As the competitive internal and external environment
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