Alibaba’s Chairman Jack Ma has reportedly delivered some disappointing news to staffers this week as the Chinese Lunar New Year approaches: don’t expect a traditional red envelope.
Known as “hongbao,” red envelopes filled with cash are traditional gifts handed out by most Chinese companies to their employees on the eve of the important Lunar New Year holiday, which falls on Thursday of next week.
It’s a longstanding custom and a gesture of good luck for the year ahead from the giver to a typically more-junior recipient. This happens both within the home — where married couples give red envelopes to their children, or unmarried young adults — and in the business world.
But in a statement posted online Ma said that Alibaba’s financial performance in 2014 wasn’t good enough to warrant handing out the benefit to staff (despite a $25 billion initial public offering in September, the largest of any company ever).
“The reason for not distributing red envelopes is that in the past year, Alibaba Group has not had exceptional results and not had any special surprises,” Ma wrote in a post on his personal blog. “The success of becoming listed should not be a surprise as it was the result of all of Alibaba’s employees’ work over 15 years. But aside from going public, objectively speaking, we haven’t been that satisfied with our results in 2014 that we should distribute red envelopes.”
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Alibaba (BABA) has faced mounting pressure after its public debut. The company announced disappointing fourth-quarter growth last month, and it is also dealing with Chinese regulators over accusations that it doesn’t actively fight counterfeit goods, bribery and other illegal activities on its sites.
In typical high-minded Ma fashion, Ma told workers “we must objectively and calmly see our own results, rationally regard external views and not let ourselves be lost in illusory fame.”
Red envelopes are not guaranteed; they are a discretionary part of a larger compensation package, according to the company. Alibaba workers will still get a year-end bonus this month, which is usually equivalent to one month’s salary.
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