Revitalizing Development Momentum Through Bold Reform and Pioneering Transformation in China Chemical Geology And Mining Bureau — A Review of Eight Years of Deepening Reform and Evolution at the China Chemical Geology And Mining Bureau

　　Reform is both the theme of our times and a pressing issue for the industry. As one of the earliest chemical geology and mining survey teams established in the early days of the People’s Republic of China, the China Chemical Geology And Mining Bureau has consistently taken the lead and proactively sought change as the institutional reform of state-owned geological survey institutions has deepened. It established the China Chem Mingda Holding Group as a platform for enterprise reform and actively embraced the market tide. Following the issuance in 2015 of the Central Committee’s “Guiding Opinions on Deepening State-Owned Enterprise Reform,” which outlined a clear “1+N” policy framework and top-level design, China Chem Mingda focused on strengthening the foundations of a modern enterprise system with Chinese characteristics, continuously optimizing its industrial structure, improving market-oriented operating mechanisms, and advancing pilot projects for mixed-ownership reform—demonstrating a vigorous spirit of proactive change and embracing reform. The results of these reforms were highly commended in the 2022 special assessment of the China National Coal Geological Bureau’s “Three-Year Reform Action.”

Leading by example and setting a precedent: The government has taken the first decisive step in institutional reform.

　　In 2015, the China Chemical Geology And Mining Bureau formulated an overall plan for enterprise‑based reform, comprehensively laid out the reform tasks, and vigorously advanced the process of enterprise‑oriented transformation. In this round of reform, the headquarters took the lead in breaking new ground, dismantling the traditional “big pot rice” system and the mindset of relying on handouts that had long prevailed in public institutions. Grounded in the Bureau’s actual business needs and development requirements, it restructured its organizational framework by moving beyond the old “division” and “section” models, strengthening the headquarters’ strategic support and oversight functions. This resulted in a five‑pillar management structure encompassing strategic guidance, operational support, comprehensive assurance, risk control, and Party building as a safeguard, with clear lines of authority and responsibility across seven departments and one office. In terms of the remuneration mechanism, the reform broke away from the conventional public‑institution salary system for the first time, introducing a position‑based performance‑pay system. It emphasized adherence to the overarching principles of distribution according to work, efficiency, equity, and sustainable development, and followed the general guidelines of “classified management, scientific job design, clearly defined responsibilities, rigorous performance appraisal, and fair compensation.” The aim was to standardize income distribution, motivate all employees, foster professional growth and enhance overall competence, and build harmonious labor relations—thereby ensuring the smooth functioning of the organizational system. The bureau-wide competitive recruitment and appointment process not only invigorated talent but also attracted top‑tier professionals from society and the industry. As a result, the headquarters’ overall management level was comprehensively elevated, marking the beginning of a broader systemic reform agenda.

　　In the same year, the reform was extended to 18 directly affiliated geological exploration institutes located across 17 provinces nationwide, fully rolling out the “one institute, one enterprise” reform model for these directly affiliated units. Subsequently, four entities within the system successively initiated the establishment of specialized subsidiaries, gradually giving rise to a corporate‑style operating framework.

Success stems from substance; under coordinated planning, a top-level strategic move is made.

　　In 2018, the China Chemical Geology And Mining Bureau played a strategic leading role, deepened reform through top-level design, and, under the guidance and support of the China National Coal Geological Bureau, officially established the bureau-level platform company of China Huada Holding Group. This marked the completion of the group’s physical operational platform. At the group level, the board of directors was effectively advanced in its standardized operation; four specialized committees—Strategy and Investment, Compensation and Assessment, Nomination, and Risk and Audit—were set up, with their rules of procedure refined. Efforts were focused on strengthening the board’s personnel, achieving a majority of independent directors, comprehensively optimizing the board’s working systems, detailing the board’s authorization mechanisms, deepening board assessment and evaluation, reinforcing the board’s oversight responsibilities, and fully promoting the establishment of boards of directors in all key subsidiaries where required. A comprehensive mechanism and institutional framework for the standardized operation of boards of directors were thus established. In addition, the “Interim Measures for the Administration of Dispatched Directors and Supervisors (Trial)” were issued, further improving the modern corporate governance structure.

　　In the same year, all 19 state-owned enterprises under the bureau completed their transformation into corporate entities, laying the groundwork for establishing an effective corporate governance structure with checks and balances and a flexible, efficient market-oriented operating mechanism.

With decisive moves and clear responsibilities and powers, we ensure the Party’s leadership is firmly secured.

　　Following the establishment of a corporate‑style operational platform, the Group Party Committee was concurrently set up, with the requirements of Party building enshrined in the company’s articles of association. This has clearly defined the Party organization’s statutory status within the corporate governance structure, specifying its duties and powers, organizational setup, operating mechanisms, and supporting safeguards. The enterprise leadership system has been comprehensively refined, gradually achieving the “dual role” of Party Committee (Party Leadership Group) Secretary and Chairman (President) in affiliated enterprises, while ensuring that all eligible entities are brought under Party leadership. By establishing and improving decision‑making checklists and institutional frameworks, major decision‑making matters have been systematically reviewed and cataloged. A “Headquarters Decision‑Making Checklist” and a “Party Committee Pre‑Review List for Major Business and Management Issues” have been formulated, and the “Meeting System” and the “Three‑Major‑One‑Important Decision‑Making System” have been revised and enhanced. In this way, Party leadership has been integrated into every stage of corporate governance, with Party organizations embedded within the corporate governance structure. The relationship between the Party Committee and other governance bodies has been properly managed, and the boundaries of governance authority and responsibility have been clarified. Efforts are being made to achieve an organic unity among the Group (Bureau) Party Committee—“setting direction, overseeing the big picture, and ensuring implementation”—the Board of Directors—“defining strategy, making decisions, and managing risks”—and the management team—“strategizing operations, driving execution, and strengthening management”—thereby better translating institutional strengths into enhanced corporate governance effectiveness.

　　During this phase, the reform agenda centers on upholding the overarching principle of “two consistent approaches” and leveraging the “four roles,” while rigorously defining and clarifying the boundaries of authority and responsibility among governance entities. By integrating Party leadership into every stage of corporate governance, we are steering the ship with steady resolve and unwavering determination, ensuring that the political course of the reform remains firmly on track.

A strategic, long-term plan for development amid industrial restructuring.

　　As reform deepens, Sinochem Mingda remains committed to its mission of safeguarding the nation’s strategic mineral resources and food security. It has gained a profound understanding of the characteristics of the new stage of development, focused on its core responsibilities and primary businesses, and vigorously advanced the optimization and restructuring of its industrial portfolio to drive industrial transformation and upgrading. The company has vigorously developed “Geology Plus” initiatives, achieved new breakthroughs in mining development, witnessed exponential growth in its ecology and environmental sectors, and ensured steady progress in underground engineering. It is now working to establish an industrial development framework characterized by “one foundation, three pillars, and two integrations”: with geological exploration as its cornerstone, mining development, ecology and environmental services, and underground engineering as its key pillars, and digital technologies and financial services seamlessly integrated with its traditional core businesses.

　　In 2018, Sinochem Mingda set its sights on the blue‑ocean market of integrated development, steadily intensifying its efforts to expand into investment and financing. It pursued strategic initiatives in both industry‑finance integration and digital convergence. Mingda Fund focused on the Group’s core business while broadening its external partnerships, establishing strategic collaborations with major state‑owned enterprises such as CCCC Shanghai Navigation Bureau and MCC Construction Engineering. By building platforms, mobilizing resources, and fostering horizontal and vertical integration, it leveraged diverse social assets to vigorously advance a series of industry‑finance‑integrated projects, including the comprehensive land‑space remediation project in the South Taihu region. Meanwhile, leveraging its capabilities in digital technology R&D and information‑technology infrastructure, Mingda Technology successfully secured approval and inclusion in the Ministry of Industry and Information Technology’s project database for its “R&D and Application of a New‑Energy Big Data Platform Based on Digital Earth” initiative. The company also forged multiple cross‑industry partnerships in areas such as new‑energy big data, geological and mining cloud‑platform development, and office automation.

　　In 2019, Sinochem Mingda signed a strategic cooperation agreement with the People’s Government of Tiemenguan City, Xinjiang. In 2020, capitalizing on policy opportunities presented by the state‑owned enterprise reform in the Xinjiang Production and Construction Corps, it joined forces with Kailuan Group to successfully acquire a 49% stake in Xinjiang Jinchuan Group Co., Ltd., thereby strategically positioning itself in high‑quality coal‑producing enterprises in southern Xinjiang. Following the acquisition, through national‑level standardization initiatives and the development of green, environmentally friendly, and intelligent mines, Jinchuan Coal Mine’s production capacity and profit contribution improved markedly, yielding strong returns on investment.

　　In 2019, Guangxi Litang Far East Fertilizer Co., Ltd. partnered with Nanjing Changci Technology Development Co., Ltd., a company with strong financial and technological capabilities, to upgrade and modernize its production line. The resulting products are highly adaptable, energy-efficient, safe, and environmentally friendly, making Far East the only large-scale state‑owned compound (mixed) fertilizer production base in Guangxi.

　　In September 2020, in collaboration with the Guangdong Coal Geological Bureau and the Jiangsu Coal Geological Bureau, the Second Project Department of the Integrated Remediation Project for Puhugeng Pits No. 3 and No. 4 and the Tailings Hill at the Muli Mining Area in Qinghai Province commenced on-site construction. Through two phases of work, and employing a restoration and remediation approach that combines “stepwise slope stabilization, partial leveling and revegetation of the pit floor, and water diversion to replace fill material in order to create a plateau lake,” both the degraded slopes and the tailings piles resulting from mining activities were effectively ecologically restored. The project achieved objectives including water conservation, permafrost protection, ecological recovery, resource reserve management, zoned control, and environmental protection, successfully integrating natural regeneration with resource conservation and establishing a model for ecological restoration of mines in high-altitude, cold‑climate regions. During preparations for the Beijing Winter Olympics, Mingda Marine Engineering Co., Ltd. leveraged its technical expertise and brand reputation in geotechnical engineering to undertake numerous infrastructure projects and geological hazard mitigation initiatives, participating in the construction of several key Olympic venues, including the “Snow Ruyi” ski jumping venue and the “Snow Dragon” bobsleigh track.

Simultaneous demolition and construction, with structural optimization skillfully executed through a masterful interplay of addition, subtraction, advance, and retreat.

　　Faced with the challenging task of balancing dismantling and building in the course of reform, Sinochem Mingda has remained firmly guided by both objectives and problems, adding value through strategic realignment while shedding non‑core assets through divestiture. It has successively formulated and implemented 72 reform measures, elevating capacity reduction to a dedicated reform initiative and positioning it as a key lever for optimizing industrial layout and restructuring. The company is committed to seamlessly integrating capacity‑reduction efforts with all aspects of its reform and development, ensuring their coordinated advancement.

　　Adhering to strategic guidance and aligning it with the implementation of the 14th Five-Year Plan, we have accelerated the divestiture of enterprises lacking competitive advantages and development potential, as well as inefficient and non‑performing assets. We have resolutely exited equity‑participated enterprises characterized by being “small, scattered, and disorganized,” while strictly controlling the number of newly established entities to prevent a rebound in overall scale. In tandem with innovative reform measures and the enterprise‑based restructuring that separates public‑sector functions from business operations, 16 of our 18 affiliated geological exploration institutes have already established enterprise‑style platforms based on their respective operating entities, thereby essentially establishing a management and operational framework across the entire system that features “large enterprises supporting small undertakings.” Upholding the principle of streamlining and strengthening, and integrating this with the separation and transfer of “three utilities and one service” functions, we have advanced the handover of such socially‑related functions—such as the provision of water, electricity, heating, and community services—from the enterprise level to external providers. To date, the comprehensive completion rate for these separations and transfers has reached 99%.

Huolieshengtun boldly confronts the market, skillfully deploying a strategic marketing offensive.

　　In early 2020, the Group (Bureau) established a Market Development Division, placing the construction of a marketing system at the forefront of its market‑development efforts. It subsequently formulated and issued a series of guiding documents, including the “Guiding Opinions of the Group on Accelerating the Construction of the Marketing System,” which clearly defined the fundamental principles and implementation pathways for market development. The Group also piloted a performance‑evaluation mechanism in certain market‑related units—featuring a base salary combined with performance‑based pay without caps—to maximize the motivation and engagement of market‑development personnel. By regularly convening market‑operation coordination meetings, the Group incorporated each unit’s marketing needs and progress in developing major projects into the agenda, thereby establishing a well‑connected, vertically and horizontally integrated marketing‑coordination framework. Adhering to a marketing strategy of “Group leadership, regional guidance, and local follow‑up,” the Group proactively pursued resource integration, aligning it with initiatives to promote coordinated regional development. In light of the system‑wide reality of numerous small, fragmented subsidiaries engaged in overlapping business lines, the Group gradually advanced the establishment of large regional hubs, setting up four major regional marketing centers—East China, Central China, Southwest China, and North China—and coordinating its directly affiliated units to adopt region‑specific market‑development models. Simultaneously, it established branch entities such as the Shanxi Business Unit, the Tianjin Branch, and the Guangxi Marine Geology Branch, strategically positioning itself in emerging and potential market segments. Overall, the Group’s (Bureau’s) top‑level design of the marketing system is demonstrating a robust trajectory of scientific and orderly development.

Using the jade ruler to assess talent, a system of dedicated research and direct incentives drives the game.

　　Driven by its marketing framework, Sinochem Mingda has taken the deepening of three‑system reforms as a key lever to streamline its internal organizational structure, refine its internal rules and regulations, and establish a robust market‑oriented operating mechanism, thereby continuously energizing all cadres and employees to pursue innovation and entrepreneurship. Adhering to a problem‑oriented approach, the company has implemented “targeted remedies,” focusing on pressing issues such as managerial personnel being able to be promoted but not demoted, employees being able to be hired but not laid off, and incomes being able to rise but not fall. It is committed to perfecting the “three‑capability mechanism”: strengthening appointment criteria and performance appraisal to dismantle the “iron chair” and enable managerial staff to both enter and exit; enhancing contractual labor management to break the “iron rice bowl” and allow employees to both join and leave; and advancing market‑based reform of income distribution to abolish the “iron wage” and ensure that earnings can both increase and decrease. At the same time, the company has formulated evaluation measures for the three‑system reforms, conducting timely inspections and assessments of the progress and outcomes across the entire system, and promptly deploying corrective actions based on the assessment findings.

　　Vigorously establish and improve medium- to long-term incentive mechanisms to fully mobilize employees’ enthusiasm, initiative, and creativity in pursuing innovation and achieving results. Adhering to five core principles—compliance with laws and regulations and transparency; strengthening incentives while maintaining rigorous constraints; adopting differentiated management tailored to individual enterprises; implementing tiered governance coupled with enhanced oversight; and advancing step by step while prioritizing excellence—we target key personnel in research, technology, management, and operations. We ensure that incentive measures are aligned with medium- to long-term development strategies and linked to medium- to long-term business performance, employing three types of incentive schemes: cash‑based incentives, equity‑based incentives, and project‑transformation‑oriented incentives. By putting these medium- to long-term incentive mechanisms into practice, we place particular emphasis on implementing equity‑based incentives and employee stock ownership programs in light of each unit’s specific circumstances, thereby deeply integrating corporate growth with employee rewards and fully unleashing the dynamism of our workforce in driving innovation and delivering value.

　　As the three-year action plan for state-owned enterprise reform continues to advance, the Group has convened special meetings, issued implementation plans, and formulated supporting systems to roll out a tenure‑based, contract‑based management model across the entire system. It has organized members of the managerial team to sign “two letters and one agreement,” clearly stipulating assessment periods, performance targets, evaluation procedures, and the application of results, as well as terms of office, job responsibilities, remuneration packages, and exit conditions. By implementing a “one person, one form” approach, the Group has established differentiated performance objectives and conducted tailored assessments, ensuring that every manager has quantifiable targets. This has further broken down and strengthened the operational accountability of managerial personnel, laying a solid foundation for rigid adjustments in managerial positions and the consistent fulfillment of compensation commitments. To date, all 42 companies within the system have fully adopted tenure‑based, contract‑based management for their managerial teams.

Seize the momentum and guide development; pilot reforms in science and technology serve as a crucial strategic move.

　　In 2020, after six years of reform and restructuring, Mingda Marine Engineering Co., Ltd. was designated as a “demonstration enterprise for science-and‑technology‑driven reform” by the State-owned Assets Supervision and Administration Commission, taking the lead in advancing comprehensive reforms. Over three years of implementation, Mingda Marine has, centered on the core objective of improving quality and efficiency, established a modern corporate governance system characterized by clearly defined roles and responsibilities, separation of government and enterprise functions, and scientific management. Using the reform of the three major systems as a breakthrough, the company has refined its talent incentive and accountability mechanisms, streamlined departmental functions, and carefully designed job positions, adopting a “stand‑up, competitive recruitment” approach for all employees. It has also instituted a tenure‑based incentive system for managerial personnel, implemented profit‑sharing for excess earnings, and introduced medium- to long-term incentives for science‑and‑technology professionals, marketing specialists, and technical experts. By innovating its performance‑evaluation framework, breaking away from egalitarianism, and appropriately widening income disparities, the company has effectively mobilized the enthusiasm and initiative of its staff. Focusing on maximizing the impact of scientific and technological innovation to drive high‑quality enterprise development, Mingda established the “Mingda Marine Engineering Co., Ltd. Sub‑Center of the Ministry of Natural Resources’ Innovation Center for Ecological Restoration Engineering in Mining Areas,” vigorously promoting the application of new technologies and the commercialization of innovative成果. The company has successively recruited three recipients of the State Council Government Special Allowance and three provincial‑level high‑caliber talents, strengthened research investment support, formulated robust plans for scientific and technological innovation, optimized the management of research funds, and enhanced the coordinated deployment of scientific and technological resources.

　　After eight years of reform, the company has leapt from the depths to soar to new heights; after eight years of rebirth, it now ascends as a soaring dragon. Through bold innovation and transformation, Sinochem Mingda’s 2021 revenue grew by 21% compared with the end of the 12th Five-Year Plan period, total profits surged by 127%, and per‑employee wages increased by 40%. The remarkable results of the reform are vividly reflected in the enterprise’s vibrant vitality and in the growing sense of fulfillment and happiness among its workforce, making Sinochem Mingda an exemplary pioneer of vigorous reform within the China National Coal Geological Bureau system.

　　Throughout the Mingda reform, a long-term vision has been maintained, with a bold spirit of dismantling the old and building the new—undertaking radical reforms to fundamentally reshape both the substance and scope of corporate management and development. This approach has been the key to its success. It can be said that the comprehensive deepening of state‑owned enterprise reform has set new expectations for this national team in the field of chemical exploration, which boasts a 70‑year history, while simultaneously creating an enabling environment for Mingda’s remarkable transformation. In turn, Mingda has adapted to the times and evolving circumstances, responding to change with proactive measures, enriching the practice of reform through its own pioneering efforts, and thereby validating the correct direction of state‑owned enterprise reform.

　　2022 marks the concluding year of the three-year action plan for state‑owned enterprise reform, as well as the year in which Sinochem Mingda takes stock of its eight‑year reform journey. Looking back, Mingda’s reforms have yielded significant results; looking ahead, there remains great potential on the new path of high‑quality development. As it embarks on this new stage of progress in the new era, Sinochem Mingda will remain steadfast in its resolve to embrace change, striving to write a new chapter of high‑quality development for the “14th Five‑Year Plan” period in the chemical exploration sector, showcasing the “Mingda Value” through the deepening of state‑owned enterprise reform, and contributing to the successful convening of the 20th National Congress of the Communist Party of China.