Gaming and social media giant Tencent said in a statement on Friday that it had fired more than 60 employees for corruption and bribery during the first three quarters of 2019.

Why it matters: As China’s tech sector slows down amid a capital winter, companies within it have been heightening their anti-corruption measures to reduce internal losses.

  • While most Series B startups in the past few years didn’t have anti-corruption teams, many Series A tech companies have started to build teams (in Chinese) to oversee these matters.

Details: In a statement released on its official WeChat public account, Tencent said its anti-fraud investigation department had identified 40 cases involving misappropriation of company assets, corruption, and bribery.

  • More than 10 of the 60 offenders were arrested. At least two of them held director-level positions at the company.
  • The wrongdoing was found in several of the company’s six business groups, including Technology Engineering Group (TEG), Interactive Entertainment Group (IEG), and Cloud & Smart Industries Group (CISG).
  • While some of the offenses are illegal, others touched Tencent’s “high-voltage line.” This is a company standard that prohibits six major kinds of behaviors such as offering and taking bribes, working for the company’s competitors, as well as leaking sensitive information.
  • Tencent also blacklisted 16 companies involved in the 40 cases, adding that it would cut cooperation with all of them and would never accept any service or product from the companies.
  • Among the blacklisted businesses is a Henan-based company that deploys ads on WeChat and a Zhejiang-based one that provides support for Tencent’s smart campus services.

Context: The year 2019 has seen a rise in the number of revealed corruption cases from tech companies.

  • In July, the food delivery platform Meituan said three of its former employees, including a director from its marketing department, had been arrested by Beijing police for taking bribes.
  • Ride-hailing platform Didi also said in August that it fired 29 employees for misappropriation of company assets and taking bribes in the first half of the year, 10 of whom were arrested.
  • In an internal letter, online searching giant Baidu also revealed 12 corruption cases within the company.

Tony Xu

Tony Xu is Shanghai-based tech reporter. Connect with him via e-mail: tony.xu@technode.com

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