Chinese Character

Hunan’s green entrepreneur

The tycoon who ditched his private jets to save the world

Hunan’s green entrepreneur

Is Zhang Yue a George Cadbury with Chinese characteristics?

In 1997, Zhang Yue caused a stir by becoming the first person in China to own a private jet. Later he was one of the first to acquire a private licence to fly a helicopter.

These days Zhang, who still admits to enjoying various forms of luxury, says he prioritises environmental protection above wealth and profit growth. Much of what he says and does, as well as the utopian Broad Town village where his company is headquartered, oozes this new-found idealism.

“My goal is to achieve the most important objectives I set for myself through the business of Broad [his company], and to carry out things that are important yet overlooked by others,” Zhang proclaims.

A short list of what this means in terms of deliverables is available for all to see in one of Zhang’s corporate booklets: “To extend human life expectancy by 30 years with simple air quality technologies; to reduce global greenhouse emissions by 15% with practical energy-saving technologies; and to ensure a healthy life for our children on this planet.”

Born in 1960 in Changsha, Zhang studied fine art at a teacher’s college. He left teaching at 24, and spent the next three years trying his luck in various businesses including painting, advertising, interior design, as well as selling motorcycles and air conditioners.

In 1988, the Hunanese entrepreneur founded Broad (the translation of its Chinese name is yuanda, which means ‘expansive and large’) with capital of just Rmb30,000. His brother Jian, who trained as an engineer in Manchuria, had patented a technology that allowed them to start selling pressure-free boilers to factories.

In 1992, the brothers decided to concentrate on producing large scale non-electric air conditioning chillers. The business prospered thanks to shortages of electricity in the country. Unlike conventional air conditioners that use electric power to compress a refrigerant, non-electric coolers use natural gas or other sources of heat to boil up a more environmentally friendly liquid, lithium bromide solution. When the vapours condense the surrounding area becomes cool. The technology is said to be twice as efficient as electrical models. Pushing the new product hard, Broad’s turnover grew from Rmb2 million in 1992 to Rmb1.9 billion ($277 million) in 1996.

Growth has slowed since 1997, with turnover currently standing at several billion yuan, according to 21CN Business Herald.

However, the company has been debt free since 1995, and Zhang insists on maintaining that ‘freedom.’ He also refuses to take the company public, or bring in any new shareholders, vowing to stick to the current business model of providing environmentally-friendly products and services.

“Why must one blindly seek more money and to become bigger? People think the bigger the better, but I believe in quite the contrary,” he confided in Manager’s Daily.

Zhang’s eco-conversion gained pace between 1999 and 2001, when he started reading widely on environmental topics. He says he suddenly grasped that the future “spelled the doom of the earth if humankind continues with the existing rate of energy consumption and carbon emissions.”

He started out by selling three of his private jets and choosing to take commercial flights instead.

He also tries to hold his company to higher standards, enforcing good governance guidelines and encouraging sustainable and environmentally friendly practices.

In an attempt to discourage its sales force resorting to bribery to win business, the company gives sales representatives bonuses of no more than 2% of their salary.

“Now with Broad’s operations, I hope to marry conservation and commercialism… In everything I do now, my ideals and my products are all in one,” Zhang wrote in a journal published in the Economic Observer.

In Broad Town itself, Zhang’s influence is striking. Located in Changsha, the company compound is home to more than a thousand workers and features buildings bearing resemblance to the Pyramids, Versailles and Buckingham Palace (with red flag hoisted aloft, admittedly). There are statues of figures like Winston Churchill and Chinese poet Li Bai.

Like chocolatier George Cadbury – who built a model village for his workers in 1893 at Bourneville – Zhang says that inspiring buildings and a pleasant environment make his employees happy, and in turn improve their work ethic and professionalism.

He is also obsessed with in-door air quality – he has 14 air purifiers in his office alone.

New recruits go through an initial 10 day session of training, wearing military-style outfits and living in barracks on the grounds.

After joining the regular workforce, most employees eat, work, and sleep at the compound, as does Zhang and his family.

Workers are woken each day at six for physical training before the workday begins. They often gather for musical events in one of the Broad Town artistic venues. But employment brings unwritten rules too. If an employee becomes romantically involved with a co-worker, one of them will be ‘advised to leave’. Not too much room for love in this particular idyll, it seems.

In August last year, Broad Town saw the construction of what the company has called the world’s first ‘sustainable building,’ with a design focus on earthquake resistance and energy efficiency. A case of clever commercial promotion perhaps? A model of the building will be showcased at the Shanghai World Expo in May, at which Broad will be the exclusive supplier of air conditioning, ventilation and air purification for the exhibition complex.

And although Zhang may be seeking to serve the greater good, he clearly sees the opportunities for personal profit in doing the right thing too.

Broad’s air conditioning and cleaning products are sold in 60 countries around the world, and have won much recognition over the years.

Still, Zhang prefers to focus on nobler aims than his personal bottom line.

“If my actions could have some impact on building energy efficiency, then I would have impacted the lives of many people,” he observes. He talks of cutting global emissions by more than a quarter if he can come up with a building design that is 70% more energy efficient.

And then he might allow himself a litle more luxury again? “Perhaps if I could achieve that one day, I’ll be comfortable with resuming the use of my planes. For me, nothing beats the satisfaction of star gazing and listening to music, while lying comfortably in my own plane.”

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