China Center Research Brief: Working Successfully with Party Organizations

Since 2012, the Communist Party of China (CCP) has instituted a sweeping campaign to arrest and reverse the perceived organizational atrophy incurred over the past few decades, especially to its hierarchical network of party organizations, the most basic unit of the party’s Leninist control structure.

The campaign to extend the party’s reach into society is now striking a nerve with the foreign business community vis-à-vis its push to install party organizations in foreign invested enterprises (FIEs) and Sino-foreign JVs, and more worryingly, to grant these units certain corporate governance rights.

While the official, external narrative holds that party organizations are wholly positive for FIEs and legally circumscribed in their activities, the internal narrative is markedly different. Party organizations are described as the primary “battle fort” of the CCP’s political governance activities and tasked with an expansive role for exerting influence within companies.