Society
Playboys finally start to grow up
By Yu Tianyu (China Daily)
Updated: 2010-03-01 08:12
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Majoring in business and communications in the UK, Peng wanted to be a freelance journalist after graduating, but his father asked him to inherit the family business.
After many arguments, Peng reluctantly became a vice-chairman of his father's company, an unachievable dream for many other Chinese young people of the same age.
"I will try my best to build up my career either in journalism or business," Peng said, "However, my father has never allowed me to make any decision for the company or adopted any of my suggestions. He just forces me to comply with his decisions, although sometimes they are totally wrong.
Unfortunately, his conservative father always thinks his son's ideas are childish, a fact that depresses the young man. "I have sacrificed my ambition and also ideal life for the family corporate good," Peng said. "It is unfair for me to be his puppet and also it is not helpful for my career."
Another problem upsetting Peng concerns his uncles and aunts, who are executives of the company. "It is really strange to work with relatives," he said. "They also regard me as a little baby. They sometimes don't even listen to me but I still have to respect them and hardly dare raise my own ideas."
Difficulties communicating
He also encountered difficulties communicating with his business partners. "I had been living in a western society for 15 years and all my way of working was very British," he said.
"I hate some of the rules and also ways of socializing which are regarded as very significant in China," he said.
China has 825,000 individuals worth more than 10 million yuan and 51,000 individuals with more than 100 million yuan, according to the Hurun Report on China's wealthiest people.
There will be an incredible number of young people like Li and Peng emerging in Chinese business circles. The report said it would be the peak season for wealth transfer from the first to the second generation in the future 10 to 20 years when inheritance will have a big impact on the long-term development of China's economy.
According to a Mckinsey management consultatnts' survey, only 15 percent of Chinese family enterprises will survive into their third generation.
The transfer of businesses has become a major challenge for Chinese family enterprises, which account for more than 90 percent of China's private companies.
Rupert Hoogewerf, founder and publisher of the Hurun Report, said one of the major advantages enjoyed by the children of China's rich is their education background compared with their fathers.
Last year, Shanghai Youth Homeland Civil Society Organization Service Center and the "Relay China" Youth Elite Association launched a survey of the rich second generation. It discovered 17 percent have a master's degree or above and 78 percent have a bachelor's degree. In addition, more than 52 percent have studied overseas.
Experts in family enterprises said Chinese entrepreneurs should seriously think about what their children study overseas and help them to combine what they learn with business conditions in China.
Teng Binsheng, a professor from Cheung Kong Graduate School of Business, has written that rich second generations totally lack work experience. Despite their overseas education background, very few of them are used to working in top multinational enterprises.
Teng also wrote that there was a big risk in transferring the business. Appropriate timing, personal will and natural ability were major elements, which should be considered by rich fathers.
According to the rich child survey, 49 percent of the interviewees disagreed with their father's management ideas, but they still could effectively communicate with them. A total of 44 percent agreed with their father's management ideas.
Teng also pointed out that the second generation shouldered responsibility for the transition of the family company's management mode and structure.
Experts said that rich fathers should open their minds and keep negotiating with their offspring.
The survey also showed that most of the respondents were recent graduates and that 46 percent of them had worked for between one and three years.
Hoogewerf said the power of the Chinese rich second generation was still emerging and it was too early to have a final word on its impact.
