China is quietly investigating and detaining executives in the country as part of a ballooning corruption crackdown, The Economist wrote.
Authorities have gone after dozens of bosses at publicly listed companies — and likely more at private firms — this year through the liuzhi system, in which detainees’ rights are restricted and targets can be held for months without court approval. While global attention has focused on foreign business sentiment toward operating in China, the detentions are contributing to a worsening corporate atmosphere among Chinese companies.
Fear of being added to a credit blacklist “is real,” The Economist wrote, “and may lead companies to take fewer risks.”