By Hu Yuanyuan (China Daily)
Updated: 2007-12-08 10:06

Chinese companies dominate a top 100 list of firms that are growing fast, globalizing aggressively and reshaping world industries, the Boston Consulting Group (BCG) said on Friday.

A total of 41 Chinese firms appeared on the BCG New Global Challengers list, with combined revenue of $14.5 billion last year and a compound annual growth rate (CAGR) of 26 percent from 2004 to 2006 - much higher than the average 11 percent of the S&P 500.

"Never before have so many potential competitors and customers arisen so quickly on a global scale," said David Michael, managing director of BCG Greater China. "Yet it is essential for every executive to develop clear strategies to deal with this group of huge and ambitious companies."

As well as the 41 Chinese firms on BCG's list, 20 are from India, 13 from Brazil, and the rest from 11 other rapidly developing economies (RDEs).

Of the Chinese companies, 34 are publicly traded and their total shareholder return grew at a CAGR of 27.7 percent from January 2002 to June this year. In addition, the international sales of the 41 Chinese firms accounted for 17 percent of their total revenue last year, up slightly from 16 percent in 2005.

"Most Chinese firms on the list are State-controlled enterprises. We would like to see more family enterprises appearing on the next report," said Michael. "Meanwhile, due to Chinese banks' strengthened efforts in exploring the overseas market, financial institutions also made their debut on the list."

The report also outlines how these companies are succeeding: by using low costs to their advantage, by going beyond cost-based competition through investment in research and development (R&D) and branding; by actively engaging in mergers and acquisition; by attracting and retaining top talents; and by effectively managing risk.

"To maintain those advantages, companies should invest more in R&D and try to be more innovative and differentiated," said Michael.