VINAMILK’S EQUITIZATION
Fundamentals of equitization
In Vietnam, the process of transferring ownership of state-owned enterprises (SOEs) to private individuals and entities is referred to as equitization, while it is known as privatization in other countries This concept retains the state's involvement, as the government often maintains a significant stake in these equitized companies, ensuring that state-owned capital remains in play and that the government's investment role continues.
After over a decade of implementing pilot programs and expanding large-scale equitization, the concept has been refined to accurately reflect practices in Vietnam The recent review by the Central Party in its 3rd Resolution of the IXth Session highlights these developments.
SOE equitization transforms state-owned enterprises into multi-shareholder businesses, primarily involving employees and private individuals as the majority stakeholders This definition effectively captures the essence and evolution of the SOE equitization process in recent times.
1.1.2 The necessity and indispensability of equitization
In the 1980s, Vietnam's focus on building a socialist economy through state-owned and cooperative ownership led to the establishment of over 12,300 small and technologically outdated state-owned enterprises (SOEs), many of which struggled with inadequate capital This scenario prompted the Party and State to seek solutions for restructuring the SOE system, enhancing their competitiveness, and reinforcing the public sector's role in the economy Consequently, the policy of SOE equitization was introduced and implemented in Vietnam.
1.1.3 Role of equitization in the economic integration
Equitization of state-owned enterprises (SOEs) promotes a multi-sector economy and socializes production by reducing state capital subsidies and allowing the government to focus on key sectors This process not only increases the number of taxpayers, enhancing state budget income, but also streamlines administration, minimizes wasteful investments, and fosters transparency in ownership Ultimately, equitization balances benefits and drives social development.
Equitization addresses capital challenges for companies, enhancing their financial strength to facilitate production and business expansion Additionally, it fosters multi-ownership structures that incorporate the state, employees, and external individuals and institutions.
Thirdly, the equitized companies are more dynamic and easily adapted to the market economy, so that their production and business effectiveness are improved
Fourthly, equitization will bring more products to the securities market.
Vinamilk’s Equitization
1.2.1 Vietnam Government’s policy of SOE equitization
Based on the result of pilot program of equitization between 1992 and
In 1996, the Government issued Decree No 28/CP on May 7, initiating the transformation of certain State-Owned Enterprises (SOEs) into equitized companies This was succeeded by Decree No 44/CP on June 29, 1998, which provided enhanced benefits for equitized businesses and their employees Despite these efforts, the pace of equitization remained slow, prompting the Prime Minister to implement Decree No 64/ND-CP on June 19 to expedite the equitization process of SOEs.
2002 on transferring the SOE into the joint stock company which replaced the Decree 44/CP
The most recent regulations on equitization are outlined in Decree 187/2004/NĐ-CP, issued on November 16, 2004, which facilitates the transformation of state-owned enterprises (SOEs) into joint stock companies Accompanying this decree is Circular 126/2004/TT-BTC, also dated November 16, 2004, which provides further guidance These documents effectively address the shortcomings identified in Decree 64.
Legal basis for Vinamilk’s equitization are included as follows:
- Government’s Decree 64/2002/Nẹ-CP dated on 19 June, 2002 on transferring the SOEs into joint stock companies
- Circular 79/2002/TT-BTC dated on 12 September, 2002 by the Ministry of Finance on guiding the revaluation of business when transferring from SOEs into the joint stock company
- Government’s Decree 187/2004/Nẹ-CP dated on 16 November, 2004 on transferring the SOEs into the joint stock company
- Circular 126/2004/TT-BTC by the Ministry of Finance on guiding the Decree 187/2004/Nẹ-CP
The establishment and development (before equitization)
Founded in 1976 as Southern Coffee-Dairy Company, a subsidiary of General Food Directorate, Vinamilk was renamed in 1992 Prior to its equitization, the company operated under the Ministry of Industry, focusing on the processing of dairy and dairy products.
- Producing and trading canned milk, milk powder, cereal, pastries, fresh milk, Soya milk, soft drinks and other dairy products,
- Trading food processing equipment, parts and accessories, materials, chemicals and raw materials,
- Real estate trading, lease brokerage; trading in warehouses and yards; products delivering and transporting by trucks, products handling,
- Producing, buying and selling alcohols, beers, beverages, processed foods, teas, coffee (roasted, ground, filtered and instant),
- Producing, trading packs/bags; pack printing,
- Producing, buying and selling plastic products,
Vinamilk produces more than 200 kind of products of milk and from milk
Vinamilk holds a leading market share in the domestic dairy sector, ranging from 35% to 75% depending on the product category Notably, 90% of its revenue is generated from exports, primarily to the Middle East, with additional markets in Cambodia, America, and Australia The company's annual export revenue is approximately $100 to $140 million.
- Transferring the business from single ownership into multi-ownership;
- Collecting money (budget) for the government;
- Creating opportunity to companies to mobilize the fund as well as driven for them to do effective business;
- Lessening the company’s dependence on government
- Creating opportunity to employees to own the company’s shares, increasing their income and duties;
- Attracting intelligence and technology from strategic shareholders;
- Creates the goods for stock market
Vinamilk has chosen to equitize and divest a portion of its state capital to investors, in accordance with Article 3 of Decree No 64/2002/NĐ-CP, dated June 19, 2002, which outlines the process for transforming a state-owned enterprise into a joint-stock company.
Beneficiary and buying share conditions
With the approval of the Ministry of Industry, the company has sold 20 percent of its shares to employees, milk cow farmers (suppliers), and external investors during the equitization process, adhering to the prices set by relevant legal regulations The capital structure post-equitization is as follows:
Chart 1: Chartered Capital Structure (At equitization)
The company used assets valuation method for tangilbe and intangible assets (the trade mark)
Following the completion of the equitization process, the company transitioned into a joint stock company as per Decision No 155/2003 Qẹ-BCN, dated October 1, 2003, which facilitated the transfer of the state-owned enterprise into a joint stock structure.
In response to the practical demands of economic renovation, the equitization policy has been widely implemented for over a decade Vinamilk, as a leading production enterprise, proactively embraced equitization to align with government policies, enhance its self-management, and boost its production capacity and competitiveness amidst economic integration The results of Vinamilk's equitization have received high praise from the State and the Government, marking it as the first equitized state-owned enterprise with capital exceeding 1,000 billion VND This significant milestone has accelerated the pace of equitization in subsequent years.
VINAMILK’S LISTING IN THE SECURITIES MARKET
Vietnam Securities Market’s Overview
Launched on July 28, 2000, the Hochiminh City Securities Trading Center (HOSTC) started with just two listed companies By the end of 2005, it had expanded to include 35 types of shares and one unit trust, achieving a total par value of nearly 2,000 billion VND and a market value of 7,500 billion VND Despite a decline in market value in 2003, the overall market capitalization experienced a robust growth of 60 percent year-on-year.
The bond market experienced a prolonged period of stagnation until significant changes were made to the trading mechanism and securities businesses initiated bond repurchase transactions (repos) These developments revitalized bond trading activities, leading to substantial growth in trading value In 2004 and 2005, the bond trading value at the HOSTC reached 41.7 trillion VND, averaging over 80 billion VND per session.
The establishment of the securities market in 2005 led to the development of financial intermediary institutions, including 18 custodians, 13 brokerage houses, and a designated settlement bank Investor accounts surged to 31,300, a significant increase from nearly 3,000 in the market's inaugural year Foreign trading emerged as a vital factor in expanding market activity, with foreign ownership limits raised from 20% to 30%, and further to 49% for industrial companies, while the financial sector remains capped at 30% Despite this growth, the equity market capitalization was relatively low, accounting for less than 1% of the GDP in 2005.
Table 1: Securities market highlights for period of 2000 - 2005
Market cap./Listing value (times)
In 2006, the securities market saw significant growth, marked by the listing of major companies such as Vinamilk, Vinh Son – Song Hinh Hydropower Joint Stock Company, and Sai Gon Thuong Tin Commercial Joint Stock Bank, along with corporate bonds issued by Vietcombank and BIDV.
By the end of 2006, the HOSTC had 106 listed companies with a combined par value exceeding 14 trillion VND and a market capitalization of 145.5 trillion VND Additionally, two securities investment funds were listed, totaling a par value of 1 trillion VND The bond market, including both government and corporate bonds, reached a listed value of 57.51 trillion VND Fund mobilization in 2006 amounted to 1.361 trillion VND, tripling the figure from 2005 During this period, share prices experienced positive movement, with the index closing at 751.77 points, an increase of over 444 points, or 2.5 times higher than the previous year.
In 2006, the total trading volume reached 643.3 million shares and unit trusts, equivalent to 38,175 trillion VND, marking a fivefold increase in volume and a twelvefold rise in value compared to the previous year Daily trading averaged 2.57 million shares, resulting in a trading value of 152.7 billion VND Including bonds, the daily turnover increased to 4.4 million securities worth 340 billion VND The number of trading accounts at brokerage houses surged to approximately 107,000, a threefold increase from the prior year, with 98% being individual accounts and over 1,300 foreign accounts, which quadrupled since 2005.
2.1.2 Assessments of the securities market
- This is the establishment period: The key elements were being set up and put into operation The market was still small and the growth rate was very low
Many joint stock companies remain hesitant to list their shares on the stock market because of the complex disclosure requirements Additionally, the potential of the market to mobilize funds for business growth has not been fully realized or leveraged.
- The demand was limited due to the lack of awareness of the securities market by the investors
- The SOE equitization was not strongly progressed and did not go in parallel with the listing in the stock market, which resulted in the shortage in the
The market capitalization in 2006 was equivalent to 22 per cent of the GDP This strong growth might be subject to the following reasons:
- The strong determination by the government to to push forward the equitization in big SOEs in order to create the supply to the stock market
- The world leading financial groups such as MerryLynch, Citigroup, HSBC… have continuously issued good reports on Vietnam’s good investment environment and economic development potential
The government plans to decrease its stake in equitized state-owned enterprises (SOEs) while maintaining ownership in key sectors This strategy aims to enhance self-management within these businesses and reduce the financial burden on the state budget.
- The Securities Law would become effective in 2007 that drew much attention from the investors
- Most of the listing companies were doing their business quite well and profitable
The Ministry of Finance announced that businesses listed after December 31, 2006, would no longer qualify for the income tax holiday, prompting a surge in new listings throughout the year.
Listing targets
Value added for the company and for the shareholders
The increase in the company's market value leads to a rise in the ownership value for each shareholder Additionally, the company's brand receives free advertising across various mass media platforms, allowing it to significantly reduce its advertising budget.
Shares can be exchanged easily through stock market
Vinamilk itself is setting up strategies to make full use of the opportunities of raising fund from the market
Providing products for Vietnam’s stock market
Vinamilk, with 159 million shares, is projected to double its listing volume by the end of 2005 If the anticipated price reaches 50,000 dong, the company's market value is expected to also increase twofold.
Benefits from listing
Since Vinamilk's equitization, the company has achieved a chartered capital of 1.590 billion VND, resulting in the State recovering a total of 1,920.3 billion VND, while still retaining a 50.01% stake in the business post-listing.
Table 2: State’s income from Vinamilk equitization
2.3.2 Benefits of employees and shareholders
The company's workforce has expanded due to new recruitments following its successful restructuring and growth Additionally, many employees are shareholders, which means that as the business becomes more profitable, the value of their shares and assets increases.
Process of equitization and listing in the securities market
- On 1 st October, 2003, the Ministry of Industry issued the Decision No 155/2003/Qẹ-BCN on transferring Vinamilk into a joint stock company
On October 18, 2003, Vinamilk conducted its initial public offering (IPO), retaining 80% state ownership post-IPO The average offering price during this event was 15,450 VND per share, generating a revenue of 292 billion VND for the state budget.
- On 1 st December, 2003, Vinamilk was licensed with the Business Register Certificate
On February 28, 2005, a second auction was held, offering an additional 15 percent of the state's ownership in Vinamilk Conducted through the HOSTC, the auction achieved an average price of 31,300 VND per share, generating 710.4 billion VND for the state budget The unexpected success of this auction marked a significant milestone, paving the way for public offerings of equitized state-owned enterprises through securities trading centers.
On November 29, 2005, Vinamilk conducted its third auction, selling an additional 10.49% of state ownership in the company The average offering price was 48,874 VND per share, generating 812.5 billion VND for the state budget.
- On 28 th December, 2005, the State Securities Commission issued listing license to Vinamilk;
- On 19 th January, 2006, Vinamilk’s shares coded as VNM was officially traded on Vietnam’s securities market.
Company’s achievements after equitization and listing
Following its equitization, Vinamilk transformed from a fully state-owned enterprise to a multi-ownership business, experiencing impressive revenue growth rates of 12.2% to 49.4% annually Between 2004 and 2006, domestic revenue alone increased by an average of 17.2% to 32.8% per year Notably, during the challenges faced in the export market from 2003 to 2004, the company strategically focused on expanding its domestic market share, leading to significant revenue increases.
Chart 3: Total Dom estic Sales
The company has focused on management accounting, leading to systematic control of input costs and a consistent year-on-year increase in after-tax profits It maintains a net profit margin of 10% to 12% and a return on equity ranging from 25% to 34%, while also providing dividends of 15% to 18% per year on par value.
2.5.2 Vinamilk’s shares in the secur7market
Vinamilk shares (VNM) experienced significant growth since their listing, doubling both the volume and market capitalization on the first day By the end of 2006, VNM was valued at 125,000 dong, representing a 2.5-fold increase from its initial trading price and 7.72 times its book value, contributing to a market capitalization of 19,875 billion dong (approximately 1.24 billion USD), which accounted for about 14% of total equity capitalization Additionally, foreign ownership in VNM rose to 39.4% by the end of 2006, up from 28.7% at the time of listing, coinciding with a market boom in share volume and trading turnover.
VNM came to the game VNIndex constantly went up and closed the year
2006 at 751,77 points which was 2.5 times higher than the year beginning
Chart 5: VNIndex and trading volume for 18 months (Jul 05 - Dec 06)
Vinamilk’s impacts to the securities market
Vinamilk's successful equitization has garnered significant interest from both local and foreign investors, positively influencing the business community This achievement serves as strong evidence of Vietnam's economic reform and open policies aimed at global integration, as well as the effectiveness of the state-owned enterprise (SOE) restructuring program For domestic businesses, Vinamilk stands as a prime example to emulate in the processes of equitization and listing.
2.6.2 Pioneer in share auction through the securities market
Vinamilk pioneered the share auction process through the HOSTC, achieving remarkable success by selling state-owned shares at prices five times higher than their par value This groundbreaking approach set a standard for other businesses, transforming the auction process at securities trading centers and eliminating negative practices associated with internal auctions As a result, numerous initial public offerings and additional stock market issues have been successfully executed, yielding significant benefits for the state.
Vinamilk's entry into the stock market significantly doubled both its total listed volume and market value, marking a pivotal breakthrough This surge in shareholder numbers not only transformed many Vinamilk investors into active market participants but also contributed to an increase in trading accounts, effectively drawing more newcomers into the investment landscape.
Vinamilk became the first state-owned enterprise with a capital exceeding 1 trillion dong to be listed on the securities market, paving the way for other large companies to follow suit This milestone is anticipated to positively influence the VNIndex's upward trajectory in the coming months.
2.6.4 Positive impact on equitization process and listing of other businesses
Vinamilk's success has sparked a wave of equitization among other state-owned enterprises (SOEs), leading to an increase in companies participating in open auctions at securities trading centers By the end of 2006, the number of listed companies had tripled compared to the previous year, highlighting the growing trend of privatization in the market.
Vinamilk’s experiences on equitization and listing
2.7.1 Setting up overall and detail plans for equitization and listing
Vinamilk's success can be largely attributed to its strategic planning phase By establishing a comprehensive and detailed plan, the company's Board gains a clear overview of the project from the outset, enabling the project team to execute all necessary tasks with professionalism and efficiency.
2.7.2 Making presentation to employees and investors about the Company’s direction
Prior to equitization, it is essential for the company to organize a workshop or seminar to communicate its post-equitization plans and direction to employees and investors Ensuring that all stakeholders understand these plans will facilitate a smoother, more efficient, and effective implementation of the equitization and listing process.
Consultancy firms are crucial in the equitization and listing process, serving as intermediaries between issuers and investors Their professional services not only enhance the company's value but also significantly increase the likelihood of successful equitization and listing.
2.7.4 Deciding the timing for equitization and listing
Vinamilk seized the opportunity to enhance its brand image by becoming the first company to conduct a share auction on the stock market amidst a slow equitization process in Vietnam The government's efforts to accelerate this transition included amending legal documents related to State-Owned Enterprises (SOEs), notably through Decree No 187/CP, which facilitated the transformation of SOEs into joint stock companies.
Following the completion of its equitization, the company promptly prepared the necessary documentation and procedures for listing on the stock market Despite being in its fifth year of operation, the market faced a persistent shortage of trading products, presenting a significant challenge for regulators In light of the government's aim to expand the securities market and the economy's robust growth, Vinamilk made the strategic decision to officially list its shares in January.
In 2006, following the celebration of the Traditional New Year, Vietnam's stock market experienced a significant boost due to a united populace, favorable terrain, and clement weather This positive environment led to a successful listing of VNM, attracting enthusiastic support from both domestic and foreign investors, which in turn facilitated a sharp rise in the introduction of new products to the market.
Following the completion of its equitization, the Company's Board of Management identified stock market listing as a primary goal Strategic preparation and optimal timing were crucial to achieving this objective Vinamilk consistently ranks among the "blue-chip" stocks and holds a significant share of the market trading turnover.
Since its equitization and listing, the company has successfully maintained and enhanced its production and business activities Strategic initiatives have been implemented to demonstrate to investors and shareholders the company's commitment to profitability, which is vital for preserving its reputation Ultimately, Vinamilk's listing has not only played a role in advancing the stock market but has also provided tangible benefits for both the company and its shareholders.
VINAMILK’S DEVELOPMENT STRATEGIES AFTER
Government Strategies on SOE equitization and development of Vietnam
During the Central Party's 9th Conference, a strategy was outlined to accelerate the equitization process of state-owned enterprises (SOEs) and enhance their listing on the stock market Key points include expediting the equitization of major businesses and general corporations, integrating initial public offerings (IPOs) with the equitization process, ensuring that the valuation of SOEs, particularly those with land use, reflects market conditions, and maintaining transparency to prevent closed internal equitization practices.
On August 5, 2003, the Prime Minister approved Decision No 163/2003/QĐ-TTg, which ratified the Development Strategy for the Vietnam Securities Market, aiming to expand the central securities market by the year 2010.
Vinamilk’s development strategies
- Diversified products, targeting to become Vietnam’s leading foodstuff group
To penetrate high-grade markets, the company aims to collaborate with leading global groups for joint investments This strategy will attract both capital and expertise, facilitating the expansion of its presence in domestic and international markets.
Vinamilk has been investing for this strategy in order to maintain and strengthen its position in the market, including:
- Concentrating to professionalize every division, from marketing, trade name management to distributing strategy
- Consistent in trade name policy as well as closely cooperation among divisions such as designing, R&D, sale, production, marketing etc, to ensure the consistency in implementing the trade name policy
- Appointing staffs to manage every brand name
- Working with consultancy and PR companies
- Investing for knowledge training in trade name management
The company is always giving the priority to the product quality by:
- Focusing on investment for equipment and technology renovation
- Seeking for a modern and comprehensive solution, choosing the one that comes from the countries with developed milk industry equipment and technology
- Attaching much importance to the technology transfer By using adapted technology, the company has gradually controlled and improved the technology to make it suitable to the domestic conditions
The company has successfully implemented a comprehensive IT system across all its factories, ensuring adherence to quality management standards outlined in ISO 9001:2000, as well as food safety protocols including HACCP and GMP.
For fresh milk, the company is looking to (1) expanding the size of fresh milk raw material areas in a effort to gradually replace the imported materials,
Ensuring food hygiene throughout the entire process—from raising and milking to preservation, transportation, and production—is crucial Additionally, it is essential to guarantee that farmers can effectively sell their milk output, which will contribute to the growth of dairy herds in Ho Chi Minh City and across the nation, in line with the Agricultural and Rural Development Ministry's "Dairy Herd Development Orientation to the Year 2010."
The company is committed to supporting milk cow farmers through various initiatives, including providing loans for quality breeding cows and essential facilities, ensuring the purchase of all fresh milk products, and investing in model milk cow farmhouses Additionally, it collaborates with local communities to establish advanced technology milk cow areas, partners with foreign companies to enhance agricultural programs, and organizes seminars and training courses Furthermore, the company supplies mixed feed and necessary equipment to milk suppliers at preferential prices, reinforcing its dedication to the dairy farming sector.
Vinamilk has established over 60 fresh milk raw material agents, achieving a daily purchasing turnover exceeding 260 tons, which accounts for more than 80% of the country's fresh milk supply The company has also invested in a robust fresh milk quality control system, supported by a trained quality-checking team well-versed in food safety standards such as HACCP, enabling them to provide timely consultations to farmers regarding milk quality.
In its policy for employees, Vinamilk is striving to the following targets:
- Ensuring enough work for employees and their income getting improved
- Ensuring adequate rights and responsibilities for employees according to the law and regulations
- Timely awarding to persons and teams who have good contribution to the company
- Assisting and creating favorable conditions for employees to attend domestic and abroad training courses
- Training and restructuring the labour force suitable to the company development
Some of the training activities being undertaken are:
- Giving scholarship for qualified candidates who are children of company’s staffs to be educated and trained abroad
- Recruiting excellent students at Hochiminh City’s Colleges and sent them to study abroad
- Financially supporting to the staffs’ high training courses
The company has established financial policies on a quarterly, yearly, and 3-5 year basis to support its future development Additionally, an accounting management and financial investment team has been created to operate alongside the existing accounting team.
The company's financial performance has significantly improved thanks to effective policies and strategies that align with its business activities Year-on-year, key financial ratios have increased, notably maintaining an after-tax profit over equity ratio exceeding 30% annually and a dividend payout ratio of at least 17% of par value each year.
The State Securities Commission approved a plan for the company to issue additional shares, aiming to raise approximately 1.2 trillion dong for fund restructuring during the period from 2006 to 2008.
Policy proposals on equitization and business operation after listing
3.3.1 Solving the benefit conflicts between the Board and the shareholder
The benefit conflicts between the Board and the shareholders are solved by some following internal policies:
3.3.1.1 Share bonus to the Board and the key staffs
In today's equitizing companies, a contradiction arises regarding share ownership among the Board of Directors and employees Employees have the right to purchase preferred shares based on their years of service, which creates an imbalance in power, as both the Board and employees hold nearly equal rights This situation places increased pressure on the Board to deliver effective management and strong business results, a pressure that is absent in state-owned enterprises (SOEs) If these conflicts remain unresolved, it can lead to passive effects within the Board, undermining the equitization process.
In order to settle this contradiction, Vinamilk issues bonus shares equal to
1 per cent of the chartered capital to the staffs and those who have important contribution to the company
3.3.1.2 Wage and salary policy to the employees and staffs
In addition to offering share bonuses to employees, the company is committed to establishing and upholding a competitive salary and wage policy By providing attractive compensation, the organization not only retains experienced staff but also draws in talented individuals Furthermore, higher income encourages employees to contribute more to the company and reduces the likelihood of misconduct.
3.3.2 Reducing the State’s share ownership
The State retains controlling share ownership in equitized state-owned enterprises (SOEs) to maintain management stability To enhance self-motivation, competitiveness, and attract capital back to the state budget, the government should expedite the sale of its shares in non-core sectors and businesses that do not require direct control This approach will not only increase product offerings but also improve liquidity for individual business shares and the overall securities market.
3.3.3 Increasing the ownership of foreigners and strategic shareholders
The rise in foreign ownership and strategic shareholders aims to attract external expertise and technology while stabilizing share prices Currently, equitized companies can offer shares to strategic shareholders at a 30% discount on the average bidding price; however, this policy may be unnecessary since issuers actively seek financially strong, knowledgeable partners Instead, issuers could prioritize strategic shareholders by creating a shortlist for additional issues or selling state-owned shares through competitive bidding, selecting the highest bidder Engaging these shareholders allows the Board of Directors to enhance business planning and strategy development in a more professional manner Furthermore, strategic shareholders serve as effective monitors of the company's operations, applying pressure on the Board to continuously strive for further development.
3.3.4 Restructuring the company management model
The current management model in Vietnamese businesses often places excessive power in the hands of the General Director, while functional divisions receive limited recognition and investment To ensure business viability and growth, it is essential to restructure the management framework, emphasizing the importance of functional divisions.
- Decentralizing administration at different level, power, responsibility to every rank, creating a crossed checked and surveillance among divisions;
- Setting up functional divisions and giving them the decision power and responsibility to some extent without reporting to the higher level;
- Setting up internal control divisions to monitor the business activities of the company;
- Building business targets, plans monthly, quarterly and yearly
- Rotating staffs among divisions frequently;
- Having policies for human resource development and training for young managing generation
The company not only offers competitive salaries and bonuses but also implements an annual share bonus program for employees, reflecting their performance throughout the year The allocation of these bonus shares is decided by the company's board of directors To ensure accountability, the issuance of bonus shares is accompanied by policies that encourage employees to take responsibility within the business.
Vinamilk fosters a dynamic and professional working environment equipped with modern facilities that cater to employee needs, enabling them to maximize their contributions Employees have direct access to the board of directors, allowing for open discussions and the sharing of ideas The company has also invested in a robust IT system to efficiently manage business activities and facilitate communication through an internal mail system This effective and time-saving environment encourages collaboration and the free exchange of opinions among colleagues and leadership.
As people's incomes rise, it becomes essential for them to contribute to the state budget through tax payments However, rather than rushing into personal tax collection, the government should develop a detailed plan and roadmap, accompanied by a clear and consistent tax policy Implementing effective tax calculation and collection methods is crucial to prevent inequality in tax collection Additionally, establishing a comprehensive education program will help individuals understand the significance of their tax responsibilities, thereby minimizing potential negative impacts during implementation.
The restructuring and renovation of State-Owned Enterprises (SOEs) initiated by the Party and Government has entered a new phase, focusing on accelerated equitization and listing on the securities market Recent regulations, including Decree No 187 and updates to the Securities Law, have established a solid legal framework for this process Equitization and listing are now seen as an irreversible trend, providing significant benefits for businesses and the broader economy by enhancing competitiveness amid economic integration The Vietnamese securities market is operating steadily, and businesses are increasingly recognizing the advantages of listing, such as improved fundraising opportunities, cost reductions, tax incentives, and enhanced market reputation Furthermore, the equitization and listing policies are gaining popularity among employees, as they align closely with their rights and benefits.
Vinamilk's success in the stock market has sparked a wave of equitization among state-owned enterprises (SOEs) Following its listing, the company is actively pursuing production and business strategies to uphold its commitments to shareholders and investors, solidifying its status as a "blue chip" stock Vinamilk aims to lead by example in implementing government policies, positioning itself as a pioneer for other businesses Furthermore, the company is enhancing its reputation by targeting listings and fundraising in foreign stock markets.