Masters thesis says Dong Mingzhu is too narcissistic. Netizens: young people, dont talk about martial arts

category:Finance
 Masters thesis says Dong Mingzhu is too narcissistic. Netizens: young people, dont talk about martial arts


Zhejiang Business University Masters thesis

On Dong Mingzhus narcissism and its economic consequences

The excerpts are as follows:

This paper selects Gree Electric Appliance as the research object, on the basis of measuring its CEO Dong Mingzhus narcissistic degree, summarizes the three main behaviors of Dong Mingzhus narcissism: 1) eager for dominant power; 2) taking risky decisions; 3) sticking to ones own opinions.

At the same time, it explores the formation process and environment of Dong Mingzhus narcissistic personality, including his own work experience and corporate governance environment. In the specific corporate governance environment, CEO narcissism is easier to play its role on the enterprise: 1) the nature of equity in state-owned enterprises; 2) the ownership is more dispersed; 3) there is CEO duality. Furthermore, based on Dong Mingzhus desire for dominating power, this paper expounds the relationship between narcissistic CEO and insider control: Dong Mingzhus narcissistic personality leads to internal control of Gree Electric appliances, which is mainly manifested as follows: 1) power imbalance of the board of directors; 2) delivery of benefits to related parties.

Finally, this paper analyzes the influence of Dong Mingzhus narcissistic personality on Grees performance. Out of the pursuit of her own success and the concern of the outside world, Dong Mingzhu enhanced Grees earnings per share through real earnings management behavior. At the same time, through the analysis of the current business development in different sectors, this paper believes that in the early stage of Grees development, Dong Mingzhu led Gree Electric Appliance to stand out from the fierce competition in the air conditioning market with its excellent sales ability and bold innovation decision-making ability. However, Dong Mingzhu tends to take risky decisions and stubborn narcissistic personality, which leads to the failure of Grees diversification and makes Gree still not find a new growth point.

Through the in-depth analysis of the above cases, this paper draws the following two research conclusions: 1) narcissistic CEO in order to meet their own desire for power, in the process of seizing power is likely to lead to insider control; 2) narcissistic CEO usually uses the method of real surplus management to improve company performance in order to show his achievements. Moreover, the influence of CEO narcissism is quite different according to the development stage of the enterprise. CEO narcissism may have more advantages than disadvantages for the enterprises in the introduction stage or growth stage, while for the enterprises in the mature or declining period, the disadvantages of CEO narcissism may outweigh the advantages.

Finally, in view of the impact of CEO narcissism on enterprises, this paper puts forward the following three suggestions: 1) considering the personality characteristics of CEOs when selecting CEOs; 2) selecting CEOs according to the enterprise life cycle; 3) reducing the impact of CEO narcissism through incentive mechanism.

Dong Mingzhus media exposure rate is very high. According to statistics, the number of her personal reports accounts for 33.22% of the total number of news published on Grees official website; the frequency of using the first person in interviews and giving speeches is as high as 70.31%; the proportion of her own image photos posted on microblog accounts for 32.33%; when it comes to photos, you may still vaguely remember the photos of Miss Dong on Grees mobile phone boot screen and her beautiful beauty on the bus shell Shadow.

Acquisition of Yinlong. In this case, the author showed his strong financial analysis ability of the accounting profession. Through the full study of Yinlongs statements and evaluation reports, Shu Xin concluded that Yinlongs financial affairs were suspected of profit fraud, and the evaluation value was uncertain. At that time, it was quite risky to purchase Yinlong and enter the field of military electric vehicles.

The author only mentioned two cases to show that Dong Mingzhu likes to make risky decisions. Her narcissism is also manifested in her stubborn opinions which are hard to reach by ordinary people. For example, in an interview with the financial times, Dong Mingzhu once said, I have never lost my hand, I never admit that I am wrong, and I will always be right.

When she failed to make a mobile phone, she said:

The vacancy of Director Secretary of Gree Electric appliances has been in March

The 66 year old Dong Mingzhu acted as his agent

On the evening of November 16, Zhuhai Gree Electric Appliance Co., Ltd. (000651) announced that since November 17 this year, Dong Mingzhu, chairman of the board of directors, will perform the duties of secretary of the board of directors on behalf of the company until the company formally employs the Secretary of the board of directors.

The last director of Gree Electric appliances was Wang Jingdong. On the evening of August 17, three months ago, Gree Electric Appliances issued an announcement. On the same day, the company received a written resignation report from Wang Jingdong, director, vice president and Secretary of the board of directors. Wang Jingdong applied to resign from the position of director, vice president and Secretary of the board of directors for personal reasons. After resignation, he would not hold any position of Gree. After that, the board of directors appointed Zhang Wei to act as the Secretary of the board.

Wang Jingdong, who has been working in Gree for 18 years and served as a Director Secretary for 11 years, suddenly resigned and attracted attention from the outside world. Wang Jingdong, 50 years old and born in 1970, is not only a senior old secretary of household appliance enterprises, but also the right-hand assistant of 66 year old Dong Mingzhu. But Dong Mingzhu made it clear in a media interview a month ago that Wang Jingdong was not his successor.

The latest news that brought Wang Jingdong to the forefront of the storm is a letter of administrative punishment on insider trading disclosed by Guangdong Securities Regulatory Bureau on November 2. The bureau investigated and tried Yu Yuns insider trading in Haili shares, and decided to confiscate 921700 yuan of illegal income and impose a fine of 276500 yuan. This administrative punishment letter shows that Wang Jingdong, as the former Secretary of Gree, is suspected to be involved.

According to the Guangdong securities regulatory bureau, Wang Jingdong is the insider of Gree Electrics increase in holding Haili shares, while Yu Yun has a close relationship with Wang Jingdong. During the sensitive period of insider information, the two people had four telephone contacts. According to the Bureau, the possibility of Wang Jingdong transmitting inside information to Yu Yun cannot be ruled out. However, the punishment decision does not mention the punishment of Wang Jingdong.

Beauty is widening the gap with Gree

As rivals, the competition between Gree and Midea is an open secret. However, with the arrival of the epidemic, Midea is opening a gap with Gree.

According to the financial data of Midea in the first three quarters, with the promotion of diversified business and online retail business, Midea achieved a total revenue of 217.8 billion yuan, a year-on-year decrease of 1.88%, and a net profit of 22.018 billion yuan, a year-on-year increase of 3.29%.

In the third quarter, Midea achieved 78 billion yuan of revenue, a year-on-year increase of 15.7%, and a net profit of 8.09 billion yuan, a year-on-year increase of 32%.

On the other hand, Grees total revenue in the first three quarters was 127.589 billion yuan, a year-on-year decrease of 18.8%, and net profit of 13.699 billion yuan, a year-on-year decrease of 38.06%.

Among them, the revenue in the third quarter was 56.866 billion yuan, a year-on-year decrease of 2.52%, and the net profit was 7.337 billion yuan, a year-on-year decrease of 12.32%.

In terms of overall performance, Gree is a little behind. In terms of stock price, Mideas market value exceeds Grees 200 billion yuan.

Netizens hot discussion

Source: Zhong Qiming, editor in charge of China fund daily_ NF5619