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Cailianshe News, July 22 (Reporter Lin Jian)Seller sentiment was once again ignited by internal disputes.

On the afternoon of July 22, a chat record from the work group of Western Securities Research Institute spread like wildfire, involving two main parties, Zheng Hongda, deputy director of business and chief analyst of the technology industry of Western Securities, and Shan Huiwei, chief analyst of electronics at Western Securities. The two had a verbal dispute around 10 o'clock in the evening of July 21, and were tit-for-tat.

According to the chat records, near late at night, the sales staff of Western Securities Research Institute asked Shan Huiwei, chief analyst of Western Securities Electronics, to contact the listed company. Shan Huiwei said that he was in a conference call and would contact later.

At this time, Zheng Hongda, deputy director of business at Western Securities and chief analyst of the technology industry, @Shan Huiwei in the group and said, "She (sales) called you about this at noon and asked about the company's time. Is it difficult?" Subsequently, Shan Huiwei responded that he was incompetent and could not complete the task.

The emotions of both parties were obviously "ignited". Zheng Hongda said, "That's a good opportunity to make room. You should quit your job as Chief Electronics Officer." Shan Huiwei also refused to give in and said, "I haven't wanted to do this job for a long time." Zheng Hongda immediately said, "Human Resources will come to handle this matter tomorrow."

The "plot" did not end there. Not long after, Shan Huiwei announced that all roadshows next week would be cancelled, "I'm going to look for a job," and emphasized that "it was the boss who wanted to fire me, not that I didn't want to go to the roadshow." The chat record ended with Shan Huiwei @ing everyone.

"Dear sales teachers, I have been working in my first job since graduation for more than four years. I have deep feelings for the Western platform, including many sales teachers and many customers. I can definitely say that I have a clear conscience at work. Since 2021, I have basically reserved all my time for work, including most of the weekday evenings and weekends. This matter is a problem between me and Mr. Zheng, and has nothing to do with others. I will bear the consequences myself. I wish you all good work."

The picture shows Shan Huiwei's professional information. Western Securities is Shan Huiwei's only sell-side professional experience.

Reporters learned from multiple sources that the above dispute is true and Western Securities is currently trying to understand the actual situation and handle the matter.

It was a very obvious, angry work dispute that had obviously become a hot topic and out of control. It also caused a lot of controversy, with many voices expressing regret and believing that emotions should not be magnified in the group. There were also many opinions expressing objections to the deputy director's unilateral dismissal of employees in the WeChat group; of course, there was also controversy about the chief's attitude, which directly stated that he would not accept the roadshow and unilaterally decided not to work, which was obviously contrary to professionalism.

Many people on the sell side said they understand this emotionality, but they also believe that being rational is a basic professional requirement, and there is no need to elevate it to an industry level. "All parties involved are emotional, but it is undeniable that there must be some problems with internal management. Both managers and general practitioners should have a more rational attitude when dealing with cyclical changes."

The director and deputy director of the institute have just changed

The reporter noticed that the dispute mainly occurred after personnel changes in the two research institutes.

First, Zheng Hongda was the chief analyst of the technology industry at Haitong Securities. He joined West Securities in mid-to-late February this year, just four months ago. From his resume, Zheng Hongda has been shortlisted as the best analyst in the computer industry by New Fortune for seven consecutive years, and has won the Crystal Ball Best Analyst award many times. Zheng Hongda also worked at Guojin Securities and worked at Haitong Securities for eight years.

Pictured is Zheng Hongda, deputy director of business at Western Securities and chief analyst of the technology industry

It is worth mentioning that Zheng Hongda also went viral in 2023. At that time, Wang Huiwen, the former co-founder of Meituan, stated on the social media "AI Heroes List" that he would form a team to embrace the new era and build China's OpenAI. Immediately afterwards, Zheng Hongda, who is still the head of the technology industry chain of Haitong Securities Research Institute, questioned Wang Huiwen's entry with funds and the "hero post", and posted a message saying, "What can 50 million US dollars do? It costs 5 million US dollars to train a large model once, and train it 10 times? People in the Internet industry don't know anything, they only know marketing, and they are not practical at all."

Second, in April this year, after Zhao Yinghua, general manager of the company's asset management branch, was promoted to assistant to the company's president, the company later appointed him to be in charge of asset management and research institute business. At present, Zhao Yinghua is in charge of the research institute, and Mu Qiguo is still the director of the research institute.

Generally speaking, disputes, quarrels, and even inappropriate words and deeds between analysts often trigger public opinion, and after being noticed by regulators, deductions are inevitable. Therefore, each research institute has also been paying attention to strengthening internal management.

This is not the first time that Western Securities has been caught up in a whirlpool of public opinion in recent years. On the evening of June 30, 2022, Fu Mingfei, a probationary employee of Western Securities, posted false information about Nanjing Bank that he fabricated in the WeChat group of community owners. The information content was some judgments and risk warnings about Nanjing Bank. In the afternoon of July 1, the content of Fu Mingfei's group chat involving Nanjing Bank quickly fermented in various WeChat groups, and Nanjing Bank and Fu Mingfei were both caught in a whirlpool of public opinion. Subsequently, Fu Mingfei urgently apologized in a circle of friends, stating that the relevant group chat records were not disseminated without his consent, and the content was not within the scope of his professional research, nor had it been verified, which was very different from the facts. In addition, Fu Mingfei also expressed regret and apology to Nanjing Bank, which was affected by this.

In response to the employee's violations, Western Securities quickly took corresponding measures. In the early morning of July 2, Western Securities held Fu Mingfei accountable for compliance regarding his inappropriate remarks about Nanjing Bank, and the company has terminated the labor contract signed between him and the company on February 18, 2022.

In response to this wave of public opinion and rumors, Fu Mingfei also received a ticket from the Shaanxi Securities Regulatory Bureau on July 8. The regulatory announcement mentioned that after investigation, Fu Mingfei, as a securities company practitioner, posted false information about Nanjing Bank in the community owner WeChat group at around 18:00 on June 30, 2022, which was forwarded and spread. The WeChat name "Fu Mingfei@Western Communications Chief" was displayed, causing adverse effects and violating relevant regulations. The Shaanxi Securities Regulatory Bureau requires Fu Mingfei to strengthen the study of securities laws and regulations, effectively regulate his own professional behavior, and submit a written rectification report.

The China Securities Association has repeatedly imposed restrictions on matters related to strengthening the management of securities analysts, aiming to regulate the professional behavior of analysts, with a focus on the management of analysts' activities and speech. In terms of reputation risk management, the China Securities Association emphasizes that securities analysts, as public figures, are subject to widespread attention from society and the media for their words and deeds, and that the inappropriate words and deeds of individual securities analysts may trigger a credibility crisis for their institutions or even the entire industry.

Talent loss and fines for compliance

Zheng Hongda once explained the reason for joining Western Securities. He said that Western Securities is still increasing its investment in sell-side business and vigorously attracting talents. Its goal is to become one of the top ten research institutes in market research within three years, so he chose to join Western Securities. "I am very grateful to the leaders of Western Securities and Mr. Mu, general manager of the R&D center, for their recognition of me. I hope to focus on the most cutting-edge development of science and technology, have a global vision and industrial chain thinking, and create the top TMT research in the industry."

However, the reporter found that the Western Securities Research Institute has also had frequent personnel changes in recent years, which is in line with the industry trend. Currently, there are only 58 registered analysts on duty. Zhang Jingjing, formerly the macro researcher at GF Securities, joined Western Securities in August 2021 as the chief of macro at Western Securities, but left in May of the following year. Since Luo Zuanhui left the position of non-bank chief at Western Securities in September 2023, the position of non-bank chief at Western Securities has been vacant for 10 months.

In the past two years, Western Securities has also received fines in the field of compliance. On June 25, 2023, Western Securities received a warning letter from the Shaanxi Regulatory Bureau due to reasons such as an imperfect internal control mechanism for securities research report business. The Shaanxi Regulatory Bureau found that Western Securities’ internal control mechanism for issuing securities research reports was not sound, individual surveys did not comply with the prior approval procedures, sales personnel participated in the assessment of research report analysts, and compliance management did not cover the main business links of expert consulting services; the quality control review of research reports was not strict, and some research reports had unreasonable valuation forecasts and imprudent conclusions. Western Securities and Liu Qinghai, Zhao Cong, and Mu Qiguo, who were then Western Securities’ chief strategy and human resources officer, head of the human resources department, and head of the research and development center, received a warning letter.

In June 2023, a securities research report signed by Western Securities researchers Xu Guanghui, Luo Yamei and Yang Jingmei had problems such as imprudent research methods, lack of reasonable justification for some assumptions, and insufficient basis for some conclusions. The Shaanxi Securities Regulatory Bureau decided to take administrative supervision measures against the three people by issuing a warning letter and recording it in the securities and futures market integrity file.