IBM Investigates Allegations of Executive Misconduct in China

1 month ago

(Bloomberg) -- International Business Machines Corp. is looking into allegations against its China head after a letter circulating online accused the executive of misconduct, including accepting gifts from business partners, the latest upheaval in the US firm’s operations in the Asian country.

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A former employee said in a letter to the US company that Chairman Chen Xudong of IBM’s Greater China Group received gift vouchers and cash equivalents from external partners, leaked classified company information to others and violated the company’s expense policies by taking his staff to karaoke bars, several Chinese outlets including the influential business publication Jiemian reported on Monday.

A IBM spokesperson confirmed the existence of the letter and said the company is looking into it.

“IBM takes seriously and thoroughly investigates any alleged behavior that might have violated our business conduct guidelines. We do not discuss individual employee circumstances and remain focused on serving our clients across greater China,” the spokesperson said.

When contacted by a Bloomberg News reporter via WeChat, China’s equivalent of Whatsapp, Chen declined to comment and referred questions to IBM’s communications team.

In August, Bloomberg News reported that IBM was shutting down a hardware research team in China in part due to geopolitical tensions between Washington and Beijing.

--With assistance from Jessica Sui.