HONG KONG (Reuters Breakingviews) - Jack Ma’s exit is a teachable moment for China tech. The charismatic former English instructor and co-founder of Alibaba has told the New York Times he plans to retire. But Ma will still wield huge influence at the $420 billion company. Investors will want clarity on who really holds the reins.
In an interview, the tycoon said he would step down on Monday, when he turns 54, to focus on philanthropic work in education. Even if his departure is not immediate, that will be a blow for the e-commerce group he set up with 17 others nearly two decades ago. At home, his rags-to-riches story has earned him loyal admirers. Abroad, he is the public face of a Chinese internet behemoth, overseeing a record $25 billion initial public offering in New York in 2014. His appearances at the World Economic Forum in Switzerland and elsewhere suggest an international statesman, rather than a corporate boss.
Unfortunately, what the exit means in practice is less clear. Ma is currently executive chairman, but will remain a director and will “mentor the company’s management”, according to the newspaper. He holds a roughly 6 percent stake too.
Certainly, the company looks prepared to carry on without Ma. A deep bench of seasoned managers - including Executive Vice Chairman Joe Tsai and Lucy Peng, another co-founder, now in charge of a push into Southeast Asia - is waiting in the wings. That’s a stark contrast to its closest competitor, JD.com, whose founder, Richard Liu, is being investigated over rape allegations. He denies wrongdoing, but the company has shed some $7 billion in market value since his U.S. arrest last week, on concerns over succession.
Still, some big questions remain: will he slowly remove himself, as Bill Gates did from Microsoft, or will he pull the strings from backstage? In addition to a board seat, Ma will probably keep his place on Alibaba’s Partnership Committee, in charge of nominating and appointing a majority of board members. Without an official title though, outsiders will have no way of gauging how much power he wields - or how to hold him accountable. Nor is it clear how the retirement will affect the company’s ties to its soon-to-be-listed financial affiliate, Ant Financial, which the billionaire controls. How he manages these issues will be his real parting legacy.
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