Jack Ma, the pioneer of China's internet industry, announced on his 54th birthday Monday that he would step down as Alibaba's executive chairman in one year to make way for the next generation of leaders at the USD 420 billion e-commerce giant.
While naming his trusted aide and CEO Daniel Zhang as his successor, Ma, one of China's richest men with a net worth of USD 36.6 billion, in a letter to customers, employees and shareholders said that "No company can rely solely on its founders."
Ma will remain Alibaba's executive chairman during the year-long period to ensure a "smooth and successful" transition, and stay on as an Alibaba director until a shareholder' meeting in 2020, the company said.
He will hand over the keys of his company to 46-year-old Zhang in an unprecedented succession plan that will slowly take the focus off one of China's most recognizable corporate names over the next 12 months, Hong Kong's South China Morning Post, also owned by Alibaba, reported.
Zhang developed the company's popular Singles' Day promotion, which is the world's biggest one-day online retail event.
He will be promoted to the executive chairman on September 10, 2019, while Ma will remain a director on Alibaba's board and a permanent member of the Alibaba Partnership, according to a letter written by Ma to all staff including to the Post.
"This transition demonstrates that Alibaba has stepped into the next level of corporate governance from a company that relies on individuals, to one built on systems of organisational excellence and a culture of consistent talent development," Ma said in his letter.
The New York Times, which interviewed him, reported on Saturday that Ma planned to use his 54h birthday to announce his retirement to devote his time to philanthropy focused on education.
The report of his retirement came as a surprise, especially in the Chinese government circles as the NYT report said Ma was relinquishing as China's business environment had soured, with the government and state-owned enterprises increasingly playing more interventionist roles with companies.
The NYT report was quickly denied by Alibaba whose spokesman told the Post on Saturday that Ma remains the company's executive chairman and will provide transition plans over a significant period of time.
"The Times story was taken out of context and factually wrong," the daily quoted the spokesman as saying.
He took care not to project himself bigger than the CPC leadership though he has emerged as modern China's most revered corporate icon.
He maintains a high profile, speaking at conferences around the globe and rubbing shoulders with world leaders.
Ma's succession plan took 10 years to put together. It owed its inception to Alibaba's formative years, long before the online marketplace forayed into cloud computing, cashless payments, artificial intelligence, and Hollywood movies, the Post report said.
"This is merely the beginning of a successful strategy of creating a step ladder to groom the next generation of managers," Joseph PH Fan, co-director of the Institute of Economics and Finance at the Chinese University of Hong Kong said.
"Jack Ma's halo is too bright, and outshines whoever's under him, so he needs to fade out. But for a company of Alibaba's size, it's a process that will take 10 years to complete," he said.
Since Zhang, known as Zhang Yong in mainland China, was named chief executive in May 2015, "Alibaba has seen consistent and sustainable growth for 13 consecutive quarters.
"His analytical mind is unparalleled, he holds dear "our mission and vision, he embraces responsibility with passion, and he has the guts to innovate and test creative business models," Ma said.
"Alibaba was never about Jack Ma, but Jack Ma will forever belong to Alibaba," he said.
Ma started Alibaba.com in 1999 as a business-to-business marketplace with 17 co-founders in his Hangzhou apartment turning the company into a global e-commerce giant with burgeoning cloud computing and package delivery businesses.
Alibaba's sprawling businesses also include brick-and-mortar stores, online video, movies, and other enterprises, and it has sought to expand in promising new markets like Southeast Asia and India.
Ma gave up the CEO role in 2013 and in recent years has found time to work on other projects, including philanthropy and performing in a kung fu movie.
He said on Monday that he wants to return to education, adding that he is still young and has "lots of dreams to pursue."
(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)