GE China interview: Compliance, big data and projects

Nearly 23,000 employees spread out over 100 cities in Greater China, including the mainland, Hong Kong, Macau, Taiwan and Mongolia. We span a broad spectrum of operations, from R&D, manufacturing, to sales; from wholly-owned entities to joint ventures, as well as marketing, sourcing, and all other support functions. GE is also a multifaceted company that covers the aviation, energy, healthcare, transportation, lighting, and digital industries. Each business group has its own legal and compliance team.

Which industry has been the most exciting to keep up with?

That's a big one. China has been the country that has experienced the most regulatory changes within every sector, and they all directly impact legal and compliance work across the board, so it's hard to single one out. Enforcement efforts such as the anti-corruption drive create unique challenges as well as opportunities for each industry. But if I had to pick one in terms of market-moving trends, it would probably be healthcare.

I was the general counsel for GE Healthcare at the time of the GSK case, and already two-thirds of my work was dedicated to compliance matters. With GE's compliance culture, our stringent policies, and our operationalized processes, I was confident that GE would not have a problem of the same nature at the same scale [as GSK China]. A solid compliance culture and a comprehensive compliance infrastructure keep a company safe, and help to ensure sustainable growth.

How's GE Digital doing in China?

Great! Today, the industrial internet is profoundly transforming the global industry and how industrial companies operate. At GE, with our unique combination of deep industrial domain expertise and software capabilities, we are leading the way in creating a new digital industrial future by connecting machines, software and data analytics to unlock industrial productivity. GE established its digital business last year and aspires to be one of the 10 largest software companies by 2020. It has invested $1 billion in this space.

GE Predix is the world's first and only cloud-based platform designed specifically for industrial data and analytics, providing our Chinese customers and partners with the tools to rapidly create, deploy, and manage breakthrough innovations. Here in China, data privacy and security are developing issues. This entails interesting regulatory challenges with respect to the storing, sharing and transfer of information. It's important to be mindful of the government's priorities regarding national and cyber security.

How do you ensure all compliance standards are met, and that a culture of proper conduct is enforced?

Culture is the key to compliance. We emphasize tone from the top, and top management “walk the talk”. We also value a firm tone in the middle, i.e. the role mid-level managers play in promoting a culture of compliance and integrity. We have regular communications and training that ensure employees are aware of potential issues and conduct business with integrity. We have a solid compliance infrastructure in place, with regular auditing and a strong reporting mechanism that allows employees to raise questions and concerns through a number of channels, such as HR, legal, compliance, finance, ombudsmen, or direct supervisors. We also have a compliance hotline.

We carry out annual trainings for our distributors as well, and of course conduct thorough due diligence before working with any new business partners. When I was at GE Healthcare, we would do performance and compliance reviews on all our partners on a quarterly basis. We have rationalized the number of distributors over the years. As for suppliers, we have larger and fewer suppliers nowadays, and they themselves have very strong internal control systems. And, as a general rule, we do not use consultants.

It's exciting to be a part of China's evolving compliance environment. I have been requested by top state-owned enterprises (SOEs) to provide training and participate in roundtables to talk about GE's corporate governance and compliance program. It is encouraging to see more and more Chinese companies implement global standards of control, and I am glad to be of support to these companies in the process.

Charlene Zhu, chief compliance officer & executive counsel, GE China

The SOE reform and anti-corruption campaign have had an impact on project approvals. How has this affected your work?

SOE reform is a critical component of the Chinese economy. The government is realizing the need to privatize and diversify while understanding that state sectors are the backbone of the country.

SOEs will continue to play a big role in China's economy, and in order for multinational companies like GE to succeed in China, they must cooperate and partner with SOEs more than ever. The “One Belt, One Road” policy presents many opportunities for these SOEs, which means just as many opportunities for MNCs to support them in going global.

The risk profile changes in these EPC [engineering, procurement and construction] projects. Contractual obligations, international trade compliance issues, compliance with other countries' laws and regulations (where the projects take place), etc., all represent interesting legal challenges. We will work with SOEs to tackle these issues, so as to help them and to help ourselves.

Global investors say that PRC market reforms have taken a toll on economic growth, making business challenging in the short term. How can you ensure that, from a legal and compliance standpoint, the China business is healthy and sustainable?

There are two perspectives to this. First, in the long-term and broader sense, these reforms will benefit companies, particularly those companies like GE, and promote a cleaner business climate. Secondly, legal and compliance efforts must move towards simplification. Too many processes and procedures can lead to confusion—simplifying and operationalizing processes and putting customers first are key to business success.

In the short run, we continue to ensure an effective compliance infrastructure, which includes adequate resources, frequent communication and training, due diligence and auditing, open reporting and investigations. This compliance infrastructure and culture of integrity protect our company, and help ensure sustainable growth.

可以介绍一下您在GE的职务和您的职业发展历程吗？

我在2008年8月作为总法律顾问加入GE医疗中国; 2014年晋升为GE中国首席合规官兼执行法律顾问。在加入GE前，我担任爱立信中国的总法律顾问。在这两家公司我都负责从公司治理，合规到业务运营的所有法律事务。

GE公司在技术，产品和合作规范文化方面享有良好声誉。相信您也知道，近年来执法力度有所加强，我从2014年头起担任GE公司层面的首席合规官一职，向GE中国首席执行官汇报。

GE中国有多少员工？分布在多少城市？

大中华区约有近2.3万名员工，分布在100多座城市，包括中国大陆，香港，澳门，台湾和蒙古。我们的运营类型范围广泛，从研发，制造到销售;从全资实体到合资企业，还有市场营销，采购及所有其他支持职能部门.GE也是一家多元化的企业，涵盖航空，能源，医疗，交通运输，照明和数字行业。每个业务集团都有自身的法务和合团队。

在配合行业发展变化方面，哪个行业带来最大的回响？

这个问题范围很广。相比其他国家，中国的各行各业都经历了巨大的监管变革，全都直接影响法律和合作规范工作的所有方面，所以很难单独列举某一个行业。反腐败推动等执法领域的努力使我们面对独特的挑战，也为各行业带来机遇。但是，如果要从市场前进趋势的角度以一个行业为例，我想可能是医疗行业。

在葛兰素史克案件期间，我担任GE医疗的总法律顾问，我工作的三分之二都与合规事务有关。凭借GE的合规文化，我们严格的政策以及操作程序，我自信会出现[与葛兰素史克]相同性质和规模的问题。稳固的合规文化和全面的合规制度保证公司安全，并有助于确保可持续增长。

GE数字部门在中国表现如何？

非常好！如今，工业互联网正在极大地转变全球工业和工业企业运营的方式.GE将工业领域的丰富专长与软件实力独特地结合在一起，通过连接机械，软件和数据分析，释放工业生产力，引领着创造崭新数字化工业未来的方式.GE在去年建立了数字业务部门，并立在2020年前跻身全球十大软件公司之列。公司在这一领域已投资十亿美元。

GE Predix是全球第一个，也是唯一专门为工业数据和分析，而设计的云平台，为我们的中国客户和合作伙伴提供迅速创建，部署和管理突破性创新的工具。在中国，数据隐私和安全问题在不断发展。这就涉及有关信息存储，共享和转让的监管挑战，非常引人关注。我们有必要留意政府有关国家和网络安全的首要任务。

您如何确保符合所有合规标准，并确保执行适当行为的文化？

文化是合规的关键。我们从公司上层强调这一点，而上层管理人员要“言行一致”。我们也很重视中层人员对合规严谨，即中层管理人员在促进合规及行为正直文化方角色。我们定期进行沟通和培训，确保员工意识到潜在的问题，并正直地开开业务。我们还有健全的合规制度，进行常规监察并设立强大的举报机制，允许员工通过多种渠道来提出问题和疑问，例如人力资源，法务，合规，财务，申请专员或直属上司。我们还开通了合规热线。

我们每年为经销商举办培训，并当然会在与任何新的业务合作方工作前开放彻底的尽职调查。当我任职GE医疗期间，我们每季度对所有合作方进行业绩和合规审查。近年来我们将经销商的数量调整至合理的水平。就供应商而言，如今我们拥有更大，更少的供应商，而且他们自己拥有非常健全的内部控制体系。此外，一般而言，我们不使用顾问。

中国的监管环境在不断变化，能参与其中是令人兴奋的经历。一些大型国企曾请我做培训并参加圆桌对话，讨论GE的公司治理和合规定项目。能看到越来越多的中国公司执行全球化管控标准是令人鼓舞的，我也很高兴在此过程中为这些企业提供支持。

国家改革和反腐败政策对项审审产生生影响。这对您的工作有何影响？

国家改革是中国经济的重要组成部分。政府明白国有行业是国家经济的支柱，同时也意识到私有化和多样化的必要性。

国有企业将继续在中国经济演艺重要角色，GE等跨国公司要在中国取得成功，比以前任何时候都需要与国有企业合作。“一带一路”政策为这些国有企业带来了许多机遇，为了支持国有企业走出去，这对跨国公司而言也意味着同样多的机会。

这些EPC（设计，采购和建设）项目的风险情况也发生变化。合同责任，国际贸易合规问题，遵守其他国家（即项目发生地）的法律法规等，所有这些都带来引人关注的法律挑战。我们将与国有企业合作解决这些问题，在协助这些企业的同时也有助于自身成长。

全球投资者表示中国市场改革对经济增长带来负面影响，营商在短期内面临挑战。您怎样从法律和合规定的角度确保中国业务是健康且可持续的？

这个问题可以从两方面来看。首先，从长期，更广泛的角度来看，这些改革将有助于企业，尤其是像GE这样的企业发展，并促进形成更加净化的商业气候。法律和合作规范方面的努力必须朝向已有的方向发展。过多的程序和步骤会引起混乱，流程的简化和实施，以及将客户放在首位才是商业成功的关键。

短期内，我们将继续确保有效的合规制度，包括充足的资源，经常性的沟通和培训，尽职调查和检查，公开举报和调查。这一合规规范和正直行为的文化将保护我们公司，并有助于确保可持续增长。

Can you describe your role at GE? How did you get there?

I joined GE Healthcare China as its general counsel in August 2008; in 2014 I moved to my current role as chief compliance officer and executive counsel of GE China. Prior to GE, I was the general counsel of Ericsson China. At both companies I was responsible for all legal matters, from corporate governance, compliance, to business operations.

GE is a very reputable company both in terms of its technology, products, as well as its compliance culture. As you are aware, there has been an increase in enforcement in recent years, and I was asked to take up the chief compliance role at the GE corporate level from the beginning of 2014. I report to the GE China CEO.

How many employees does GE China have? And in how many cities?

Nearly 23,000 employees spread out over 100 cities in Greater China, including the mainland, Hong Kong, Macau, Taiwan and Mongolia. We span a broad spectrum of operations, from R&D, manufacturing, to sales; from wholly-owned entities to joint ventures, as well as marketing, sourcing, and all other support functions. GE is also a multifaceted company that covers the aviation, energy, healthcare, transportation, lighting, and digital industries. Each business group has its own legal and compliance team.

Which industry has been the most exciting to keep up with?

That's a big one. China has been the country that has experienced the most regulatory changes within every sector, and they all directly impact legal and compliance work across the board, so it's hard to single one out. Enforcement efforts such as the anti-corruption drive create unique challenges as well as opportunities for each industry. But if I had to pick one in terms of market-moving trends, it would probably be healthcare.

I was the general counsel for GE Healthcare at the time of the GSK case, and already two-thirds of my work was dedicated to compliance matters. With GE's compliance culture, our stringent policies, and our operationalized processes, I was confident that GE would not have a problem of the same nature at the same scale [as GSK China]. A solid compliance culture and a comprehensive compliance infrastructure keep a company safe, and help to ensure sustainable growth.

How's GE Digital doing in China?

Great! Today, the industrial internet is profoundly transforming the global industry and how industrial companies operate. At GE, with our unique combination of deep industrial domain expertise and software capabilities, we are leading the way in creating a new digital industrial future by connecting machines, software and data analytics to unlock industrial productivity. GE established its digital business last year and aspires to be one of the 10 largest software companies by 2020. It has invested $1 billion in this space.

GE Predix is the world's first and only cloud-based platform designed specifically for industrial data and analytics, providing our Chinese customers and partners with the tools to rapidly create, deploy, and manage breakthrough innovations. Here in China, data privacy and security are developing issues. This entails interesting regulatory challenges with respect to the storing, sharing and transfer of information. It's important to be mindful of the government's priorities regarding national and cyber security.

How do you ensure all compliance standards are met, and that a culture of proper conduct is enforced?

Culture is the key to compliance. We emphasize tone from the top, and top management “walk the talk”. We also value a firm tone in the middle, i.e. the role mid-level managers play in promoting a culture of compliance and integrity. We have regular communications and training that ensure employees are aware of potential issues and conduct business with integrity. We have a solid compliance infrastructure in place, with regular auditing and a strong reporting mechanism that allows employees to raise questions and concerns through a number of channels, such as HR, legal, compliance, finance, ombudsmen, or direct supervisors. We also have a compliance hotline.

We carry out annual trainings for our distributors as well, and of course conduct thorough due diligence before working with any new business partners. When I was at GE Healthcare, we would do performance and compliance reviews on all our partners on a quarterly basis. We have rationalized the number of distributors over the years. As for suppliers, we have larger and fewer suppliers nowadays, and they themselves have very strong internal control systems. And, as a general rule, we do not use consultants.

It's exciting to be a part of China's evolving compliance environment. I have been requested by top state-owned enterprises (SOEs) to provide training and participate in roundtables to talk about GE's corporate governance and compliance program. It is encouraging to see more and more Chinese companies implement global standards of control, and I am glad to be of support to these companies in the process.

Charlene Zhu, chief compliance officer & executive counsel, GE China

The SOE reform and anti-corruption campaign have had an impact on project approvals. How has this affected your work?

SOE reform is a critical component of the Chinese economy. The government is realizing the need to privatize and diversify while understanding that state sectors are the backbone of the country.

SOEs will continue to play a big role in China's economy, and in order for multinational companies like GE to succeed in China, they must cooperate and partner with SOEs more than ever. The “One Belt, One Road” policy presents many opportunities for these SOEs, which means just as many opportunities for MNCs to support them in going global.

The risk profile changes in these EPC [engineering, procurement and construction] projects. Contractual obligations, international trade compliance issues, compliance with other countries' laws and regulations (where the projects take place), etc., all represent interesting legal challenges. We will work with SOEs to tackle these issues, so as to help them and to help ourselves.

Global investors say that PRC market reforms have taken a toll on economic growth, making business challenging in the short term. How can you ensure that, from a legal and compliance standpoint, the China business is healthy and sustainable?

There are two perspectives to this. First, in the long-term and broader sense, these reforms will benefit companies, particularly those companies like GE, and promote a cleaner business climate. Secondly, legal and compliance efforts must move towards simplification. Too many processes and procedures can lead to confusion—simplifying and operationalizing processes and putting customers first are key to business success.

In the short run, we continue to ensure an effective compliance infrastructure, which includes adequate resources, frequent communication and training, due diligence and auditing, open reporting and investigations. This compliance infrastructure and culture of integrity protect our company, and help ensure sustainable growth.

可以介绍一下您在GE的职务和您的职业发展历程吗？

我在2008年8月作为总法律顾问加入GE医疗中国; 2014年晋升为GE中国首席合规官兼执行法律顾问。在加入GE前，我担任爱立信中国的总法律顾问。在这两家公司我都负责从公司治理，合规到业务运营的所有法律事务。

GE公司在技术，产品和合作规范文化方面享有良好声誉。相信您也知道，近年来执法力度有所加强，我从2014年头起担任GE公司层面的首席合规官一职，向GE中国首席执行官汇报。

GE中国有多少员工？分布在多少城市？

大中华区约有近2.3万名员工，分布在100多座城市，包括中国大陆，香港，澳门，台湾和蒙古。我们的运营类型范围广泛，从研发，制造到销售;从全资实体到合资企业，还有市场营销，采购及所有其他支持职能部门.GE也是一家多元化的企业，涵盖航空，能源，医疗，交通运输，照明和数字行业。每个业务集团都有自身的法务和合团队。

在配合行业发展变化方面，哪个行业带来最大的回响？

这个问题范围很广。相比其他国家，中国的各行各业都经历了巨大的监管变革，全都直接影响法律和合作规范工作的所有方面，所以很难单独列举某一个行业。反腐败推动等执法领域的努力使我们面对独特的挑战，也为各行业带来机遇。但是，如果要从市场前进趋势的角度以一个行业为例，我想可能是医疗行业。

在葛兰素史克案件期间，我担任GE医疗的总法律顾问，我工作的三分之二都与合规事务有关。凭借GE的合规文化，我们严格的政策以及操作程序，我自信会出现[与葛兰素史克]相同性质和规模的问题。稳固的合规文化和全面的合规制度保证公司安全，并有助于确保可持续增长。

GE数字部门在中国表现如何？

非常好！如今，工业互联网正在极大地转变全球工业和工业企业运营的方式.GE将工业领域的丰富专长与软件实力独特地结合在一起，通过连接机械，软件和数据分析，释放工业生产力，引领着创造崭新数字化工业未来的方式.GE在去年建立了数字业务部门，并立在2020年前跻身全球十大软件公司之列。公司在这一领域已投资十亿美元。

GE Predix是全球第一个，也是唯一专门为工业数据和分析，而设计的云平台，为我们的中国客户和合作伙伴提供迅速创建，部署和管理突破性创新的工具。在中国，数据隐私和安全问题在不断发展。这就涉及有关信息存储，共享和转让的监管挑战，非常引人关注。我们有必要留意政府有关国家和网络安全的首要任务。

您如何确保符合所有合规标准，并确保执行适当行为的文化？

文化是合规的关键。我们从公司上层强调这一点，而上层管理人员要“言行一致”。我们也很重视中层人员对合规严谨，即中层管理人员在促进合规及行为正直文化方角色。我们定期进行沟通和培训，确保员工意识到潜在的问题，并正直地开开业务。我们还有健全的合规制度，进行常规监察并设立强大的举报机制，允许员工通过多种渠道来提出问题和疑问，例如人力资源，法务，合规，财务，申请专员或直属上司。我们还开通了合规热线。

我们每年为经销商举办培训，并当然会在与任何新的业务合作方工作前开放彻底的尽职调查。当我任职GE医疗期间，我们每季度对所有合作方进行业绩和合规审查。近年来我们将经销商的数量调整至合理的水平。就供应商而言，如今我们拥有更大，更少的供应商，而且他们自己拥有非常健全的内部控制体系。此外，一般而言，我们不使用顾问。

中国的监管环境在不断变化，能参与其中是令人兴奋的经历。一些大型国企曾请我做培训并参加圆桌对话，讨论GE的公司治理和合规定项目。能看到越来越多的中国公司执行全球化管控标准是令人鼓舞的，我也很高兴在此过程中为这些企业提供支持。

国家改革和反腐败政策对项审审产生生影响。这对您的工作有何影响？

国家改革是中国经济的重要组成部分。政府明白国有行业是国家经济的支柱，同时也意识到私有化和多样化的必要性。

国有企业将继续在中国经济演艺重要角色，GE等跨国公司要在中国取得成功，比以前任何时候都需要与国有企业合作。“一带一路”政策为这些国有企业带来了许多机遇，为了支持国有企业走出去，这对跨国公司而言也意味着同样多的机会。

这些EPC（设计，采购和建设）项目的风险情况也发生变化。合同责任，国际贸易合规问题，遵守其他国家（即项目发生地）的法律法规等，所有这些都带来引人关注的法律挑战。我们将与国有企业合作解决这些问题，在协助这些企业的同时也有助于自身成长。

全球投资者表示中国市场改革对经济增长带来负面影响，营商在短期内面临挑战。您怎样从法律和合规定的角度确保中国业务是健康且可持续的？

这个问题可以从两方面来看。首先，从长期，更广泛的角度来看，这些改革将有助于企业，尤其是像GE这样的企业发展，并促进形成更加净化的商业气候。法律和合作规范方面的努力必须朝向已有的方向发展。过多的程序和步骤会引起混乱，流程的简化和实施，以及将客户放在首位才是商业成功的关键。

短期内，我们将继续确保有效的合规制度，包括充足的资源，经常性的沟通和培训，尽职调查和检查，公开举报和调查。这一合规规范和正直行为的文化将保护我们公司，并有助于确保可持续增长。