Last updated on February 27th, 2020 at 01:23 pm
Milwaukee-based A.O. Smith has terminated the president of its business in China for violations of the company’s guiding principles and code of conduct.
Wei Ding was a senior vice president with the company and president of A.O. Smith China until he was terminated on Feb. 18.
Jack Qiu, vice president of A. O. Smith (China) Investment Co. and a 17-year veteran of the company, has been named acting leader of A. O. Smith China.
“Jack is a strong and knowledgeable leader. Under his watch and guidance, we will continue to deliver high-quality, innovative products – the products that our customers in China want and expect of us,” Tami Kou, director of corporate communication for A.O. Smith, said in an email.
China is an important market for A.O. Smith, accounting for around 28% of its nearly $3 billion in sales last year. In 2018, the country accounted for 34% of almost $3.2 billion in sales.
In a securities filing this week, the company said Ding’s firing was related to an internal investigation started in the fourth quarter of 2019 with the help of outside counsel and under the oversight of the A.O. Smith board.
Kou declined to provide additional details on Ding’s departure, describing it as “strictly a personnel matter.”
She did note that the issue came to light in the fourth quarter and was not related to allegations made in May last year by short-seller J. Capital Research, suggesting the company had obscured the growth of its business in China.
Ding was general manger of A.O. Smith’s China water business from 1999 to 2012. He was promoted to vice president with A.O. Smith Water Products in 2006 and a senior vice president with A.O. Smith in 2013. He held a number of top roles with the company’s Chinese subsidiaries from 2013 to 2017, when he was named president of A.O. Smith China
Also in 2017, A.O. Smith entered into a special retention agreement with Ding that made him eligible for a $500,000 bonus if he was with the company on June 1, 2022 and the company hit certain financial thresholds. He was also eligible for a $1 million bonus if he was with the company on June 1, 2017.
Ding had a base salary of $451,000 in 2018 and total compensation of $1.9 million, according to A.O. Smith’s most recent executive pay disclosures.