Morgan Stanley's strategy in China is a subject of perennial interest to its rivals. Harvard Business School might even consider it as a case study for its MBA course.
The conservative American investment bank has easily the boldest strategy in China. Its 35%-owned joint venture with China Construction Bank, the China International Capital Corporation (CICC), is entering its second year of operation and has about 80 staff in Beijing, around 10% of whom are expatriates. The idea is simple. Morgan Stanley contributes its world-class investment banking skill. Major shareholder Construction Bank provides its connections and political clout. Voilà, China's first capable investment bank.
CICC's HQ is on the 23rd floor of the Everbright Building, and, to those familiar with the style, it's like entering a Morgan Stanley office. There is the creamy, rippled wallpaper and the rosewood doors and furniture that characterize Morgan Stanley's offices around the world. On a desk there's a Morgan Stanley glossary book. "Yes, I agree," says Fang Fenglei, CICC deputy chief executive. "But I hope to be like Morgan Stanley in our systems and internal controls and management as well as in furniture."