The decision casts a shadow over one of the most important executives at China’s largest corporation, a former Google software engineer once regarded as a frontrunner to succeed CEO Daniel Zhang.

(Bloomberg)—Alibaba Group Holding Ltd. demoted ecommerce chief Jiang Fan and took away a year’s worth of financial incentives, disciplining the top executive after concluding an investigation into allegations of improper behavior, a person familiar with the matter said.

Alibaba removed Jiang, who oversees its main online shopping services, from a so-called partnership of 38 people who influence the board’s make-up. It also demoted him to vice president from senior vice president, the person said, asking not to be identified discussing internal matters. Alibaba declined to comment in an emailed statement.

The decision casts a shadow over one of the most important executives at China’s largest corporation, a former Google software engineer once regarded as a frontrunner to succeed CEO Daniel Zhang. This month, Jiang’s wife took to microblogging site Weibo to publicly warn a prominent social media influencer not to “mess with” her husband, igniting a frenzy of social media speculation even after the post was removed.

Much of the discussion revolved around Jiang’s relationship with the online personality, and whether it had influenced certain business decisions or investments by Alibaba. The company concluded however that there had been no transfer of interests between Jiang and the influencer or her company after an internal investigation, according to a post on the company’s internal website seen by the person.

While unsubstantiated, the ensuing outcry online threatened to tarnish Alibaba — a company that’s branded itself as women- and family-friendly en route to becoming the country’s most valuable corporation. Charismatic billionaire founder Jack Ma, a fixture on the international speech circuit, enjoys a folksy image back home and likes to portray Alibaba as a champion of small business and corporate ethics.

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The online brouhaha also emerged at a time much of the company is scrambling to fix logistics snarls and expand certain services to cushion itself against the economic shocks of the Covid-19 pandemic. Alibaba’s shares, which touched a 2020 trough in March, are down about 4% for the year.

The Beijing News reported earlier Jiang had apologized to staff internally and urged an investigation into the matter. Bloomberg hasn’t independently verified the allegations.

A key lieutenant to Zhang and co-founder Ma, Jiang will continue to oversee Taobao and Tmall, Alibaba’s twin e-commerce flagships. He was only recently added to Alibaba’s core leadership, the 38-person partnership that nominates the majority of the company’s board. The executive, who set a goal last April of doubling Tmall’s transaction volume within three years, last year helped Alibaba’s signature Singles’ Day shopping spree to a record $38 billion worth of sales.

Alibaba owns and operates Taobao and Tmall, which hold the No. 1 and No. 2 spots in the ranking for Digital Commerce 360 Online Marketplaces.

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