Chinese web and gaming giant Tencent has admitted it fired more than 100 people in 2022 for various forms of corruption – some so serious it reported them to local police.
In a post to the corporate WeChat account, Tencent’s internal corruption-fighters released the conglomerate’s annual anti-corruption report and detailed one employee in the film production unit who accepted bribes and was jailed for three years.
Another was sentenced to two years for the same offence.
Other employees embezzled corporate funds, arranged sham contracts, or solicited goods for personal use from Tencent suppliers.
In all, 23 outside entities were named as having been involved with corrupt dealings at Tencent.
Tencent has over 100,000 employees, so finding around 100 of them were crooked does not suggest widespread corruption.
But CEO Pony Ma reportedly did make such a suggestion in December 2022, when he bemoaned “shocking” levels of corruption across the business, and ill-discipline that led to tolerance of loss-making ventures.
The latter issue appears to have been addressed. Last week Tencent reported that its video and news divisions managed to record profits – a pleasing turnaround. And overnight Tencent video appears to have scored a hit with a live-action adaption of seminal Chinese sci-fi novel The Three-Body Problem.
Tencent’s share price has also done very well in recent months, rising from a November 2022 low of HK$190 to reach HK$370 in recent trading.
Beijing’s easing of restrictions on tech firms may have restored investor confidence, with Ma’s insistence that the many-tentacled corporation shed unprofitable businesses also the sort of thing shareholders generally like to hear.
Challenges remain for Tencent. Growth has foundered in its gaming division, and Beijing hasn’t helped by slowing approval of new titles. TikTok threatens the group’s social media and e-commerce businesses, creating a need to monetize its diverse video offerings more aggressively.
The tech giant has also admitted, in its most recent earnings call, that macroeconomic conditions don’t look brilliant.
But at least it has rid itself of more than 100 staff who abused their positions for personal gain. That action alone has the potential to improve financial and business performance, and will earn it the approval of China’s government – which abhors corruption. ®