[SEOUL G20 BUSINESS SUMMIT/CEO STORY]For Telco Chief, Love of Country is Foremost

If Huawei Technologies Co. President Ren Zhengfei, 56, had been from a “good” family, the world might not know of the “Huawei Legend” that has catapulted the company into the position of the second-largest telecommunications network equipment company globally in just 22 years.

Ren’s father was an accounting employee in a factory that made weapons for the Chinese Nationalist Party’s army, and when the Communist Party seized power in China, his family was under constant suspicion for possible links with the exiled Nationalists.

Ren Junior joined the People’s Liberation Army and worked as a technology officer, but was still denied membership in the Communist Party. He finally joined the party in 1978, but was discharged from the army in 1982 as part of a large reduction of forces in the PLA.

Huawei, which started out as a distributor of private branch exchanges, was the company he launched as a civilian, but his love of country has not been moderated by his switch from army uniform to business suit: He emphasizes patriotism to the extent that the name Huawei means “Care for the Chinese nation.”

This attitude has become a burden to Huawei’s global ambitions as the U.S. and Indian governments harbor suspicions over its motives.

With Huawei’s main commodity being the telecommunications equipment that is essential in mobile phones, the two governments worry that the equipment may be used for spying if merged with phone-tapping technology. Ren’s PLA career, his Community Party activities and Huawei’s Sino-centric brand fuel these suspicions. India is drawing up a bill to force Huawei to open its source code - essentially, the blueprint for telecommunications networks - while the United States has blocked Huawei’s acquisition of 3Com for security reasons.

Another factor weig-hing upon Huawei is that Ren is a particularly reclusive chief executive; He tends to avoid interviews with both foreign and domestic media. Adding to Huawei’s mystery is that it is a privately held company, so there is no way to know its investment plans or cash flow, despite the fact that it is a huge telecommunications company with revenues of approximately US$21.8 billion last year.

However, Ren is known for sharing his success with his subordinates. He holds only a 1.42 percent share in Huawei; the remaining stock, over 98 percent, is in the hands of Huawei employees.

By Kim Sang-hoon
sanhkim@donga.com