HONG KONG -- Jack Ma Yun will step down as executive chairman of Alibaba Group Holding in one year and be succeeded by Chief Executive Officer Daniel Zhang, marking a watershed moment for the Chinese technology powerhouse as it shifts to a new generation of leadership.
Alibaba, China’s most valuable company as measured by market capitalization, said on Monday that Ma would remain in his current position as executive chairman until Sept. 10, 2019, "to ensure a smooth transition of the chairmanship."
"While remaining as executive chairman in the next 12 months, I will work closely with Daniel to ensure a smooth and successful transition," Ma said in a letter to employees and shareholders on Monday, his 54th birthday. "Thereafter, I will stay on the Alibaba board of directors until our annual shareholders meeting in 2020."
"This transition demonstrates that Alibaba has stepped up to the next level of corporate governance from a company that relies on individuals, to one built on systems of organizational excellence and a culture of talent development," said Ma,one of Asia's most high-profile business leaders .
Alibaba has been a linchpin in China’s corporate develop since it was founded nearly two decades ago, becoming one of the world's largest technology companies with a sprawling business empire that includes retail, financial services, media and entertainment, and cloud computing.
The company employees about 87,000 workers, and its influence on the Chinese economy extends further to suppliers and other companies with which it does business.
Shaun Rein, managing director at China Market Research Group in Shanghai, said the announcement shows that Ma "is empowering Zhang and giving an orderly transition." Rein called the move "very smart" because it "reduces uncertainty over who is in charge to make decisions" at the company. "Ma won't loom over Zhang for years," he said.
"This is the way to inform business partners and government officials that Daniel Zhang and other leaders are the right people to talk to because, right now, everybody wants to talk to Jack Ma," Rein said.
"By doing this, he is empowering his successors, which is important because Alibaba has a really strong team and it's time for them to take on more power as Alibaba has moved into other countries, like India, and moved into new divisions, like cloud computing and finance," Rein said.
In his letter, Ma said he wants to return to education, "which excites me with so much blessing because this is what I love to do." Ma graduated from Hangzhou Normal University in 1988 and continued to teach English there for several years.