Reform Corporate Governance Structures and Build a Comprehensive Budget Management System for State-Owned Enterprises_News_北京智达方通科技有限公司

As China’s market economy continues to develop, state-owned enterprises (SOEs) have entered a critical phase of reform. Enterprises should strengthen cost control and enhance management efficiency based on their actual conditions to ensure steady growth. In recent years, the concept of comprehensive budget management has been widely adopted in SOEs, and strengthening its system has become an important measure to improve corporate governance. As an efficient management tool, comprehensive budget management requires a suitable environment. Therefore, reforming corporate governance and establishing a comprehensive budget management system will vigorously promote sustained socio-economic development.

Current Status of Comprehensive Budget Management in SOEs

Unlike other economic entities, SOEs function as administrative economic units with单一 (single) ownership structures, leading to loose connections between state-owned asset supervision departments and operational activities. Additionally, the unique goals of SOEs often include social responsibilities that may conflict with profit motives. Compared to non-state enterprises, SOEs place greater emphasis on political achievements and stability, making it challenging to implement effective performance-linked incentives and constraints. Moreover, multi-level and multi-department governance structures often result in imperfect management systems. These internal factors collectively affect the efficiency of comprehensive budget management.

Although SOEs have achieved certain results in promoting comprehensive budget management, the lack of long-term planning often leads to neglect of risk avoidance and strategic development. Budget execution remains weak, and process control lacks refinement. Currently, SOEs still face multiple challenges in advancing comprehensive budget management:

1. Incomplete Budget Management Content:

SOEs often lack clear control points and specific indicators, hindering timely adjustments and reducing flexibility in response to changing conditions.

2. Lack of Close Interdepartmental Coordination:

Budget management is often handled solely by finance departments, without effective integration with production, operations, or innovation. Information related to budgeting, execution, and feedback is not timely shared, impeding orderly progress.

3. Absence of Refined Control:

SOEs have yet to fully incorporate modern budget management concepts into strategic planning. Without considering market conditions and capital reserves, systematic analysis is lacking, and refinement in control processes remains low.

4. Low Level of Management Informatization:

As SOEs expand, data volume grows, yet many fail to prioritize informatization. Inadequate hardware and software optimization hinders timely data processing and analysis.

Strengthening the Foundation for SOE Reform and Development

To effectively address these issues, SOEs should adopt long-term development perspectives, establish scientific budget plans, and improve execution mechanisms. Starting with corporate governance reform, budgeting should be treated as a comprehensive management tool integrated with advanced technologies like Intcube Planning to fully implement comprehensive budget management.

1. Ensure Sound Budget Management Content:

Regularly analyze budget execution based on market conditions and internal characteristics. Integrate budget management into development strategies, set clear policies and principles, and define key indicators for efficient implementation.

2. Strengthen Organizational Coordination:

Improve modern corporate governance, establish fair budget management platforms, and promote employee engagement. Develop diversified control mechanisms that enhance interdepartment collaboration, leveraging professional expertise across all stages of budgeting.

3. Enhance Refined Control:

Strictly follow strategic deployments and budget systems to oversee all stages of budget management. Ensure data authenticity during budgeting, improve execution procedures, strengthen supervision, and maintain detailed management records.

4. Advance Budget Management Informatization:

Strengthen IT infrastructure for budget management, ensure timely data collection, and improve databases and sharing mechanisms. Utilize modern IT to optimize system configuration and resource allocation. Integrate financial and operational data to enhance dynamic linkage, fostering competitive advantages and innovation capabilities.

In summary, given their unique attributes, SOEs must balance market conditions and internal development needs, reform governance structures, and build modern comprehensive budget management systems. By enhancing organizational coordination, refined control, and informatization, SOEs can solidify their reform foundations. With the ongoing deepening of China’s socialist market economy, the Intcube team supports SOEs in maximizing their potential and elevating management standards, injecting sustained vitality into economic growth.