Some officials of State-owned enterprises (SOEs) squander outlandish amounts of public money on lavish dinners, exotic liquor and other highly expensive commodities. This abuse of power is another form of corruption.

In the latest scandal, Sinopec Group's Guangdong branch spent more than 3 million yuan ($459,160) on hundreds of bottles of the choicest variety of liquor in just one month last year. The purchase invoices have been posted online and Sinopec has admitted that they are real. And though the company tried to explain that the liquor bottles were for sale, insiders have exposed that they were meant for the company's top officials, who could offer them to guests.

Sinopec is one of the largest SOEs. Its top official is appointed by the government to run it on behalf of the State and the people. Hence, there is no reason for the official to consider himself the boss with the power to spend as much money as he likes.

Two years ago, Sinopec bought a million-yuan chandelier for its refurbished office building, an act that the public and media lambasted it for.

Now that governments at all levels are under heavy pressure to disclose their detailed budgets, it is more than necessary for SOEs to be open about their non-production expenses.

True, the SOEs make money for the State. But they could not have become what they are today without the State's support and without the government-granted monopoly.

However great a job they do, they should know that they have no right to squander public money. It is ludicrous for SOEs' top executives to think that they are the monarchs of all they survey.

Most SOEs, especially the ones listed on the stock market, are supposed to have a board of directors. The money they earn belongs not just to the State and the people in the broader sense, but also to whoever buys their shares. In fact, the shareholders have a greater say in listed SOEs' affairs.

In this sense, the squandering of company money on liquor by the top official of Sinopec's Guangdong branch is not just a violation of the rules, but an infringement upon shareholders' interests as well.

Sinopec has sent investigators to probe the case. But no matter what the result is, the lavish expense is a reminder that a mechanism is needed to keep SOEs' top executives in check.

(China Daily 04/16/2011 page5)