Fri, Oct 17, 2008 page2

• BUSINESS COMMUNITY: Remembering the ‘God of Business’

  • By Joyce Huang / STAFF REPORTER
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  He may have left billions of dollars, but what the business community will remember most about Wang Yung-ching (王永慶) was his business vision, pragmatism and the virtues of hard work and thrift.

  “His contribution to the local economy is beyond words,” chairman of the Chinese National Association of Industry and Commerce (工商協進會) Theodore Huang (黃茂雄) said by phone yesterday.

  “He was a very down-to-earth businessman and few in the local business community can live up to his achievements,” chairman of the General Chamber of Commerce (全國商業總會) Chang Ping-chao (張平沼) said.

  

  Wang Yung-ching participates in a run at a Formosa Plastics sports event in March 1994. Wang passed away in New Jersey during a business trip on Wednesday.

  PHOTO: CNA

  Wang was surely the most successful businessman in Taiwan with only an elementary school diploma.

  He was sent by his father to work as an apprentice at a rice shop in Chiayi at age 15, just after he had graduated from elementary school in 1932. He borrowed NT$200 from his father a year later and started his own rice shop. In 1954, he began a plastics business, which quickly expanded in the 1960s before becoming the world’s largest plastic manufacturer in 1980.

  Huang had worked for Wang and highly admired his clear-cut style of management, while Chang was friends with the business tycoon despite their 23-year age difference.

  Huang said that Wang would not hesitate to cut losses and close any subsidiaries if he found the businesses were not worth operating or unprofitable. On the contrary, Wang would dare to pump big money into investments he believed had good long-term prospects.

  “He was a rationalist, who rejected waste of resources or money,” Huang said.

  Chang said that Wang was “a man of words,” who would not break any promises to his business partners.

  “What’s more, he was also a man of action,” Chang said, adding that Wang would address any urgent matters efficiently.

  Wang’s success and management philosophy earned him the nickname “God of Business.”

  His Formosa Plastics Group (台塑集團) has been ranked as the nation’s most profitable conglomerate since 2004, and made NT$219 billion (US$6.7 billion) in net profits last year, up from NT$161 billion in 2006, China Credit Information Service Ltd’s (CCIS, 中華徵信所) annual rankings showed.

  The group was also the nation’s second-largest conglomerate by asset value and the only non-bank that made it into the top 10 list, with NT$2.46 trillion in total assets last year, an increase of NT$330 billion from the previous year, when it was ranked sixth, the credit agency’s report showed.

  Formosa Plastic had also led in annual revenues in 2006, although its No. 1 spot was taken by Hon Hai Precision Industry Co (鴻海精密) last year.

  Formosa Plastics was the only conglomerate that boosts its asset value through its earnings rather than by raising funds from shareholders in the open market, CCIS editor-in-chief Liu Jen (劉任) said.

  Although he delegated his day-to-day management role at the firm to a decision-making team in 2005, Wang retained a final say in the group’s management, Liu said.

  “Without Wang working as the arbiter, his seven-member team will now be facing a new challenge,” Liu said.

  Liu said that he believed Wang’s death would have a limited impact on the business, since the team has been in charge of daily operations for almost four years. There may still be challenges ahead though, depending on how Wang’s family decide to divide up his fortune and businesses.

  The group was also one of the agency’s top 10 “defensive”picks because of its outstanding liquidity, net worth and profitability that will give it an edge during the current financial crisis.

  Wang was ranked on this year’s Forbes’ annual list as the nation’s second richest business tycoon with a fortune of US$6.8

  billion, up almost 40 percent from last year’s US$4.9 billion.

  His daughter, Cher Wang (王雪紅), and her husband, Chen Wen-chi (陳文琦), came in fifth, with combined assets of US$3.5 billion.

  In spite of his wealth, what made Wang stand out was his thrift, he rarely spent money on luxury items and lived a simple life.

  Chang said Wang was on a mission to help society and his employees and wasn’t that interested in making money.

  Wang once told Chang: “I already have all the money I could possibly spend, but I have a responsibility and what I am working for is other people’s happiness.”

  For your information

  WANG YUNG-CHING CHRONOLOGY

  Jan. 18, 1917 — Born the son of a tea farmer in Sindian City (新店市), Taipei County 1932 — At the age of 15, having just finished elementary school, Wang was sent by his father to a rice store in Chiayi (嘉義) to work as an apprentice. A year later, Wang borrowed NT$200 from his father to establish his own business 1942 — Wang closed his rice business and used 10 years of savings to purchase a 20 hectare piece of land in Sindian 1943 — Wang invested in a timber business. During the post World War II economic recovery it made Wang NT$50 million 1954 — Wang established Formosa Plastics Corp (福懋塑膠), which specialized in manufacturing polyvinyl chloride (PVC) resins 1957 — Formosa Plastics began operations with a daily production volume of 4 tonnes of PVC. The company changed its Chinese name to (台灣塑膠), abbreviated as (台塑), but the English name remained unchanged 1958 — Wang established Nan Ya Plastics Corp (南亞塑膠) to serve as Formosa Plastics’ downstream processor and sales business 1978 — Wang opened Chang Gung Memorial Hospital (長庚醫院) in Linkou, the largest hospital in Asia 1983 — Wang set up a printed circuit board (PCB) project at Nan Ya Plastics, marking his first step into the electronics industry 1989 — Wang signed a US$7 billion memorandum of understating with the authorities in China’s Fujian Province, for the creation of a petrochemical and plastics special industrial zone in Haicang, Xiamen. The Fujian provincial government agreed to provide Wang with a 10,100 hectares of land 1992 — Because the Taiwanese government wanted Wang to be based in Taiwan, Wang was forced to give up the Haicang Project (海滄計劃). Wang attributed the abandonment of the project to “misunderstanding and dissatisfaction” between the two governments across the Taiwan Strait 1993 — Formosa Plastics became the world’s largest manufacturer of PVC resins, while Nan Ya Plastics became the world’s largest processor of PVC 1994 — Wang invested NT$9 billion to establish a petrochemical special zone in southern Taiwan, the inauguration of which occurred at the beginning of the year 2006 — Wang retired as chairman of Formosa Plastics Oct. 15, 2008 — Wang dies in New Jersey
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