Editor Departs China Magazine After High-Profile Tussle

November 10, 2009

Editor Departs China Magazine After High-Profile Tussle

By JONATHAN ANSFIELD

BEIJING — The pioneering editor of the top Chinese business magazine has left her post with plans to start anew, after a tussle for control involving much the same mix of political and financial intrigue that she made her mark uncovering.

Hu Shuli, 56, resigned Monday from Caijing, the magazine she built into a thriving print and Web outlet that specialized in investigating government corruption and corporate fraud, said a Caijing spokeswoman, Zhang Lihui. Senior editors and most of Caijing’s journalists either had already resigned or were preparing to as well, magazine employees said.

For months, Ms. Hu, the editor in chief, and the business managers of the magazine had been locked in a stalemate with the owners of Caijing over the breadth of the magazine’s coverage and the budgeting of its operations, said former employees and current staff members who asked not to be identified because they feared losing their jobs.

The owners of the magazine had come under pressure from Communist Party officials to rein in Caijing’s aggressive journalism, people at the magazine have said.

Managers at Caijing told staff members that they had been fighting to maintain the magazine’s editorial integrity.

The managers and editors had been seeking to create a more independent publication by changing the magazine’s shareholding structure, courting outside investors and pressing the owners to allow more employees to own a stake in the magazine.

In a well-publicized exodus earlier this autumn, nearly 70 business employees resigned. Ms. Hu held on until Monday.

She has now accepted a new post as the dean of the journalism school at Sun Yat-sen University in Guangzhou, a job she had been offered before it became clear that she would leave Caijing.

At the same time, she, along with a large contingent of editors and executives departing Caijing, was working to secure new licenses and open a new venture, said the employees, who had knowledge of the plans but were not authorized to speak publicly about them.

Caijing’s parent company, the Stock Exchange Executive Council, or S.E.E.C., had already recruited a new team of editors from another progressive publication, The Economic Observer in Beijing, they said.

In 11 years at Caijing, editorials by Ms. Hu pinpointed interest groups and bottlenecks that she said blocked economic overhauls. And exclusives by Caijing hastened the demise of some of the more notorious felons in China.

But the magazine’s own troubles have involved just the sort of topic that Ms. Hu and Caijing relished covering.

The political price of success grew in recent years. Ms. Hu found herself increasingly at odds with S.E.E.C. bosses and their Communist Party guardians, according to employees and other colleagues during interviews in recent months.

After a run-in with a Caijing reporter covering the ethnic riots in the western region of Xinjiang in July, officials leaned harder on Ms. Hu’s superiors to curb her coverage, the employees said.

At one point, the S.E.E.C. was ordered to fire Ms. Hu, they said. The pressures brought the infighting over editorial and financial control of Caijing to a boil.

Ms. Hu did not respond to requests for comment Monday.

Known for enforcing a rigid code of conduct, she has been characteristically guarded during the crisis.

“I am still working on a good result,” she wrote in an e-mail message to The New York Times late last month.

Under her current plan, her new publishing sponsor would be the province-level Zhejiang Daily Press, said the Caijing employees and a Zhejiang Daily editor.

She has been talking with well-known Chinese investors. Her proposed new publication’s title has a familiar ring: “Caixin,” short for “Caijing Newsweek.”

The split reflects the divergence of interests in a media market still governed by party cadres, said Zhan Jiang, a journalism professor at Beijing Foreign Languages University.

“Some people still stick to their ideals,” he said. “But management has become increasingly concerned with profits, and increasingly conservative.”

Moreover, as the central authorities lavish official Chinese media giants with support to grow and compete globally, they also have made moves to tighten their chain of command over muckrakers like Ms. Hu.

Not that Ms. Hu is like any other. She has become an unrivaled celebrity, and counts senior economic officials friends from her reporting days at state-owned newspapers.

At S.E.E.C., she was uniquely insulated. The chairman of the S.E.E.C., Wang Boming, a former New York Stock Exchange economist, is the son of a former deputy foreign minister.

When Mr. Wang and Ms. Hu started Caijing, in 1998, he met her demands to finance the newsroom and not interfere.

But their ambitions clashed as the influence of Caijing grew. Caijing now generates about half of the group’s revenue, but the S.E.E.C. has reinvested a considerably smaller percentage.

Mr. Wang has diversified into less daring titles, most of which have struggled.

Members of Ms. Hu’s team, in turn, went their own way, expanding Caijing online. They also tapped outside partners, like the Hong Kong tycoon Richard Li, with whom Ms. Hu has been developing a financial news service.

Behind the scenes, a conservative official named Quan Zhezhu had taken over Communist Party affairs at the organization that sponsors Caijing’s publishing license, the All-China Federation of Industry and Commerce, in 2007, replacing the son of a liberal ex-party leader. The Federation ramped up pressure on Mr. Wang to curb coverage by Ms. Hu.

“They say she’s ungrateful, that without them the magazine would have been closed a long time ago,” a friend of Mr. Wang’s said.

An S.E.E.C. executive did not answer requests for comment in recent days.

Ms. Hu was able to elude serious trouble through the spring. After Caijing revealed a corruption investigation into China Central Television earlier this year, government media officials demanded that the story be recalled, the employees said.

But within a couple days, Caijing reposted the piece online and handed out hundreds of undistributed magazines to delegates at the annual legislative sessions.

When the ethnic riots broke out in July, Ms. Hu promptly dispatched three journalists to Urumqi. But not all of them were able to obtain a permit to be there.

One day, at the official press center, a veteran reporter named Yang Binbin was caught carrying a credential borrowed from a former coworker. When an official tried to search his laptop, he resisted, and he and a guard scuffled. The police carted off the reporter for questioning, then sent him back to Beijing.

To make matters worse, the altercation unfolded in front of a division chief from the party’s central propaganda department.

“Our pressures and conflicts had accumulated over a long time, but this incident was the fuse,” said a Caijing colleague of Mr. Yang, who himself declined to comment.

By mid-July, journalists said, the party’s powerful Central Commission on Politics and Law discussed the need to “rectify” Caijing. Propaganda authorities have reprimanded the magazine for at least eight articles this year, including the China Central Television inquiry, and directed it to “return to positive reporting on finance and economics.”

Under orders from the All-China Federation, the S.E.E.C. demanded the right to prescreen the magazine before it went to print.

Ms. Hu resisted the order. But the magazine was still required to cut at least three investigative features, including one from Urumqi, and the Web site scrapped two new columns and left the “Politics and Law” section without new posts for three days in September, to avoid riling officials.

At a gathering with Mr. Wang in August, according to a friend of his in attendance, Mr. Wang said that officials had pressured him to fire Ms. Hu. Mr. Wang said that he would not go so far as to dismiss the acclaimed newswoman and that, he told friends, the move would cause an international scandal.

But his perceived failure to stand up to editorial pressures exacerbated the financial infighting about ownership shares and budgets, to the point that Ms. Hu and Mr. Wang, as another journalist put it, “couldn’t stand each other.”

In late September, Caijing’s general manager and other executives led a walkout of more than 60 business staff members. As of last month, dozens of those who resigned had already started working at what several said were Caixin’s new offices.

For weeks, many journalists have been planning to follow Ms. Hu to the new venture. But Ms. Hu could have to wait months for new publishing licenses, if the authorities approve them, the journalist and others said.

“She hopes that having this new academic position will make it easier for her to negotiate” to start the new outlet, said the journalist, who was among those preparing to rejoin Ms. Hu.

Copyright 2009