Limiting the General Manager's power at appointment,
and ensuring that his departure from the company is not paired with
unnecessary damages.
This article was written for, and first appeared on Business
Forum China
It is all too common that a foreign investor appoints a Chinese
or expatriate as the General Manager of its Chinese wholly-owned
subsidiary or joint venture (or respectively the Chief
Representative of its Representative Office), but at some point
concludes that this Manager or Chief Representative (GM) does not
meet expectations. More often than not, firing the GM is not easy.
In a typical case, the GM – who was also the
company's legal representative and a director of the Hong Kong
holding company – refused to leave. Instead she took the
company's stamps, licenses and accounting books home, and even
threatened to poison relations with Chinese customers if she was
not given a very high severance package.
