Chinese e-commerce giant Alibaba Group Holdings has fired a male manager and accepted the resignations of two other executives in response to allegations by a female employee that she was raped by the manager during a business trip last month.
The charges surfaced last weekend after the woman posted an 11-page document detailing the assault on Alibaba’s internal communications platform. In the document, the woman alleges that on July 27, during a business trip to Jinan in Shandong province, a senior Alibaba colleague, Wang Chenwen, took her to a dinner with clients, where he forced her to drink until she was intoxicated. The woman says she was groped by a male client then, after she lost consciousness, was sexually assaulted by Wang in her hotel room. (Wang has not publicly commented.)
She claims that when she reported the incident to Alibaba leaders, she was ignored—even when she took to the Hangzhou-based company’s dining hall last Friday with a bullhorn, to air her allegations. The 11-page document was reposted on social media Saturday, where it drew immediate public outrage and triggered an intense debate about sexual assault, alcohol, and China’s toxic work culture.
In a company-wide memo released Monday, Alibaba’s chief executive Daniel Zhang said Wang, the male manager accused of the assault, had been fired for having “overly intimate relations” with a colleague. Two of the manager’s superiors have resigned, while the company’s chief human resources officer has been given a demerit. Zhang also announced a company-wide training program to prevent sexual harassment.
Zhang said Alibaba would leave the question of whether the manager had “committed rape or indecency that violates the law” to law enforcement authorities. Police in Jinan have launched an investigation.
On social media, many Internet users faulted China’s workplace drinking culture in the incident. The practice is an entrenched feature of Chinese corporate life. Typically, forced drinking sessions involve copious quantities of baijiu, a clear Chinese liquor distilled from fermented sorghum that has head-spinning alcohol content of up to 60%. The custom played a role in 2018 rape allegations against Richard Liu, the founder of Alibaba rival JD.com. In that case, a young Chinese woman studying in Minnesota claimed that Liu plied her with liquor then raped her in her apartment. (He said the sex was consensual and wasn’t charged.)
A few years back, Quartz writer Siyi Chen argued in this essay that China’s drinking culture—where those who lack power are pressured to consume more alcohol to ingratiate themselves to those who have it—was falling out of fashion among those employed in China’s tech sector, where skill and knowledge matters more than status, hierarchy, and personal connections.
But Zhang’s response was a tacit admission that the practice is still a problem. He specifically condemned what he called a culture of “forced drinking” at Alibaba. “We are staunchly opposed to the ugly forced drinking culture,” he wrote in the memo. “Regardless of gender, whether it is a request made by a customer or a supervisor, our employees are empowered to reject it.”
That’s a worthy goal. But there were no details on what steps Alibaba will take to put a stop to forced drinking culture or to make sure its employees really are empowered to just say no.
As Fortune’s Yvonne Lau notes, Alibaba didn’t have an anti-sexual harassment policy in place before this allegation emerged, which is a shortcoming experts call “unsurprising…given the lax enforcement of workplace laws, coupled with the widespread acceptance of sexist practices” in China’s corporate scene.
More Eastworld news below.
Clay Chandler
– clay.chandler@fortune.com
This edition of Eastworld was curated and produced by Eamon Barrett. Reach him at eamon.barrett@fortune.com.
EASTWORLD NEWS
Suga’s Olympic loss
The Tokyo 2020 Olympics concluded on Sunday with the U.S. edging into first place on the gold medal table, with 39, followed by 38 for China and 27 for Japan. Tokyo held the games despite widespread public opposition, as people feared the Olympics would turn into a super-spreader event. That hasn’t happened, but Prime Minister Suga hasn’t been rewarded for the successful games. Polling by three local media outlets showed Suga’s approval had fallen to its lowest level post-Olympics, as the government heads towards a general election in November. Bloomberg
Samsung on parole
Lee Jae-yong, chairman of South Korea’s Samsung, will be released from prison on parole Friday. Lee has served eight months of a 30-month sentence for bribery. The third generation Samsung heir paid former South Korea President Park Geun-hye to approve a merger between two Samsung affiliates. The merger solidified Lee’s control of the giant tech conglomerate. Lee could still be returned to prison, however, on separate charges of fraud. WSJ
Vaccine island
Singapore, a city-state of some 5 million people, has fully-vaccinated 70% of its population, with an additional 9% having received just one dose of a vaccine so far. The small financial hub now has one of the world’s highest vaccination rates and, in order to encourage even higher uptake, the government has said residents no longer need to make an appointment to receive the vaccine. Singapore is targeting an 80% vaccination rate by September, when officials will ease some of the island’s harshest social-distance restrictions. Fortune
Home schooling
China online tutoring leader VIPKid announced it would stop hiring overseas English tutors, following Beijing’s crackdown on education firms. The government banned education firms from hiring foreign tutors based outside of China in sweeping new regulations last month. Education firms hoped hiring overseas tutors as “contractors” would be a loophole for regular operations to continue, but VIPKid’s announcement shows that is not the case. Reuters
MARKETS AND MOVERS
Philippines — The Philippines economy grew 11.8% in the second quarter, compared to the same period last year, officially pulling the country out of a 15-month recession. The recovery, from a baseline of -17% in Q2 2020, was driven by increased household spending. But the country’s performance in H2 this year is precarious, as the Philippines endures new lockdowns as it battles the spread of the Delta variant.
PUBG — Shares in South Korea game maker Krafton plunged 20% after the company’s IPO in Seoul on Tuesday, before closing down 13.5%. Krafton, which is known for creating the battle royale game PlayerUnknown’s Battle Grounds (PUBG), raised $3.8 billion in its debut listing, but is struggling to convince investors that it is more than a one-hit wonder.
Bytedance — The FT reports China’s Bytedance has revived plans for an IPO in Hong Kong as early as Q4 this year, despite Beijing’s current crackdown on Big Tech platform. Bytedance is the parent company of short video app TikTok and numerous other content platforms in China. A private fundraising in December earned the group a roughly $180 billion valuation.
Nope — NetEase’s music streaming service Cloud Village—the second-largest music platform in China—scrapped a $1 billion public offering in Hong Kong amid China’s crackdown on tech firms. Cloud Village was due to go public, but the offering appears to have faltered as investors, wary the company might be targeted by regulators in the near future, refused to “lock up” their shares.
Crypto unicorn — CoinDCX has become India’s first cryptocurrency unicorn after raising $90 million in a round led by Facebook. CoinDCX is a cryptocurrency exchange based in India but registered in Singapore.
FINAL FIGURE
China’s 12 wealthiest tech tycoons have lost $87 billion of wealth since the start of July as Beijing continued its clampdown on the nation’s tech companies. The latest stage of China’s crackdown began at the end of June, when regulator’s ordered ride-hailing service Didi to stop registering new customers days after the company went public in New York. Didi’s shares are down 33% to date. Of the 12 tycoons tracked by Bloomberg, Colin Huang—founder of social e-commerce site Pinduoduo—has lost the most. His net worth is down $15.6 billon, or one-third of what it was in June. Tencent founder Pony Ma has lost 22% of his net worth, or $12 billion.
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