Corporate universities feel heat of political pressure

An elite private business school has been forced by Chinese authorities to halt new enrolments this month as its founder, Jack Ma, one of China’s richest men, faces problems over his business empire after he criticised China’s financial regulations.

Hupan University, which runs a highly selective executive training programme, suspended its first-year intake due to begin classes at the end of March, seen as fallout from the crackdown on Ma’s vast empire which includes online retail and digital payment systems.

Hupan University, sometimes known as Lakeside University, was founded in 2015 in Hangzhou in Zhejiang province, the city which hosts the headquarters of Ma’s Alibaba group, Asia’s biggest company by market capitalisation. Its stated aim is to teach entrepreneurship and business management to “high achievers”.

The course normally lasts three years and has strict recruitment criteria – students must have founded a company, employ more than 30 people and generate at least CNY30 million (US$4.6 million) in annual revenue.

It quickly became one of the country’s most prestigious and selective business schools with Ma himself teaching there from time to time. Ma said at the university’s fifth anniversary celebrations on 22 October 2020 that over the past five years some 11,788 had applied to the university of which 251 enrolled, saying it was more selective than Harvard or Stanford universities in the United States.

According to the Financial Times newspaper, which first reported the enrolment freeze, the Chinese Communist Party viewed the institution as a place for top entrepreneurs to work towards goals set by Ma rather than the party.

But others have said halting the new intake while other classes are allowed to continue at the university was a warning to Ma, who reportedly irked the Chinese leadership for criticising the country’s financial regulations during a financial sector summit in Shanghai, known as the Bund Summit, in October 2020.

Ma, who was an English teacher early in his career before he founded Alibaba, has come under increasing pressure. His Alibaba group was investigated by the authorities in December 2020 over ‘monopolistic practices’ and incurred a record fine of US$2.5 billion earlier this month.

Ma himself has not been seen in public for months.

Bid to curb Ma’s influence

Experts said it is not just Ma’s businesses being targeted but his influence. Other reports said Beijing is pushing Ma to sell off his media assets, which include Hong Kong’s influential South China Morning Post newspaper, amid apparent worries that he is able to influence public opinion through such channels.

Academics note Ma’s cult following in China among young people who often refer to him as ‘Teacher Ma’, an indication of his influence, which has enabled him to speak out forcefully on a variety of issues, leading to aggressive personal attacks on Ma from the state-controlled internet.

Ma’s plans for Hupan University were already being targeted last year shortly after his Bund Speech.

Last August the university announced that a massive new campus would be built in Kunming in Yunnan province, close to China’s border with Vietnam.

Funding was to come from the local government in Kunming for the project on some 1,281 hectares of land.

However, bidding for the campus’ construction, which had opened in August, was shelved and on 10 December a public statement from the Xishan District office in Kunming where the intended site is located, said the plans were being terminated, citing “new controls”.

Hundreds of corporate universities

Hupan University is one of hundreds of corporate universities established in China since the late 1990s by business groups which provide the main financing for their operations. Many typically have the business head or founder as the university’s head or governing board chairman.

According to Futao Huang, professor of higher education at Hiroshima University, Japan, who has written about China’s corporate universities, such institutions “are not regulated by any educational laws or corporate laws because they are not registered as formal educational institutions offering academic degrees or diplomas and certificates”.

While they are not regulated by education authorities, the government is [still] able to close them,” Huang told University World News, adding: “They are easily founded and easily closed.”

Such universities may be coming under closer scrutiny as Xi Jinping’s government attempts to reel in anyone dissenting from the official line amid a general tightening of ideological control on colleges and universities.

Huang referred to “huge changes” in the relatively unregulated corporate university sector and agreed that such universities could be subject to the vagaries of whether their bosses are in or out with the Communist Party leadership.

Many were not accredited or approved by any government or local authority and are not considered part of formal education. “Many do not provide a systematic or coherent curriculum and are based solely on their founders’ philosophy or ideas,” Huang said.

Public-private universities also come under pressure

Hupan is officially registered as a private non-enterprise or social enterprise and cannot deliver officially recognised degrees.

But some corporate universities have expanded into multi-faculty professional training institutes with official approval, such as Beijing Geely University founded by Li Shufu, head of Geely automobile group, which also owns Volvo cars and the manufacturer of London’s taxi cab.

It was set up as a private higher vocational college in 2000 with the approval of Beijing education authorities and with Li Shufu as the university’s chairman. Unlike Hupan, it is authorised to issue state-recognised diplomas and now has 15,000 students and cooperation agreements with foreign universities.

The university offers extensive courses in engineering, manufacturing, business and design and other disciplines related to all areas of the automobile industry, including training female models for car shows.

Another public-private example is Shantou University in Guangdong province, co-founded by Hong Kong’s richest man Li Ka-shing, who made his fortune in Hong Kong in manufacturing, real estate and media, after moving to Hong Kong from Shantou, China, at the age of 12. He is regarded as Asia’s richest man.

The billionaire’s charity, Li Ka Shing Foundation, of which both Li Ka-shing and his son Richard Li are directors, has donated more than HK$10 billion (US$1.3 billion) to the university, which is jointly funded by China’s Ministry of Education and the Guangdong provincial government.

The university was considered unique, being publicly funded but with the substantial influence of a private foundation able to mould its curriculum and outlook, which strongly emphasised overseas exchanges.

However, Li, now 92, came under attack in 2019, accused of undermining confidence in China’s economy by liquidating assets on the mainland. He faced a barrage of criticism from official media during the year, including criticism that he failed to openly support police during the crackdown on protests in Hong Kong that year.

With Li falling foul of Beijing, the influence of his foundation on the workings of the university was first reined in and then terminated. Li was removed as honorary chairman of the university’s governing council and his son Richard Li was removed from the university council in 2019.

Academics in Guangdong province said: “After his 40 years of involvement and all that Li Ka-shing has given to the university, and not just financially, it appears he no longer has any say in the university.”

Since 2019 teachers, including foreigners, have been attending mandatory ideology classes and the university has been ordered to hire faculty on the basis of their party loyalty. Its international outlook has been undermined, with many exchanges ended.

Such changes can be damaging for students who signed up to something different, but the more vocationally oriented sectoral universities based on skills acquisition are less likely to see interference in their courses, according to experts.

Different types of corporate universities

Some academics are now scouring the ups and downs of corporate universities, particularly those which go beyond pure training for employees, for clues about their founders’ political fortunes.

“There are different types [of corporate universities in China]. Some indeed provide vocational training courses like Meituan, China’s largest food delivery platform, for their employees, while others such as Hupan University are called clubs of celebrities,” said Huang, adding: “They are primarily intended for their own employees as a sort of centre of educational training.”

Last year Ciweek, a publication under the Chinese Academy of Sciences, listed China’s leading corporate universities for 2019, with Hupan University at the top, followed by Huawei University in Shenzhen, Haier University set up by the domestic appliance company of the same name, Tencent University in Shenzhen, Ping An University set up by the insurance company in Shenzhen, JD College founded by the e-commerce company in Beijing, TCL University set up by the electronics company in Huizhou in Guangdong, ZTE University in Shenzhen, Hisense College set up by the electrical appliances company, and Ctrip University set up by the travel services company.

Other notable corporate universities were launched by ByteDance, parent company of TikTok, which set up its ‘Zhichun Class’ in 2019, open to founders of internet-related companies in areas such as 5G, the Internet of Things and artificial intelligence. It has been described by academics as a “glorified networking group”.

Another major Chinese company, Tencent, set up Qingteng University which described its mission as focusing on founders and entrepreneurs to “provide a lifelong learning platform for creators of cutting-edge industries”. It’s recruitment literature says applicants must be a founder, chairman or CEO of a successful start-up that has received significant financing. Participants undergo “multiple rounds of screening” before admission.

This week Tencent, China’s giant social media and video games company, pledged around CNY50 billion (US$7.7 billion) towards environmental and poverty-alleviation initiatives and education in line with Xi Jinping’s key priorities, as other huge companies come under increased scrutiny for their dominant market position in the wake of Alibaba’s fine.