After reports of sex-trading and corruption, China Unicom promises reforms

China’s three major telecom companies – China Mobile, China Telecom, and China Unicom – are all state-run. They are massive, powerful and not coincidentally also prone to corruption. That’s certainly the case at China Unicom, where a series of recent inspections by the Central Committee uncovered all kinds of disturbing behavior, from run-of-the-mill corruption to employee abuse of power for sex. The report specifies that “leaders and key employees” were found to be colluding with third-party contractors and abusing their positions to obtain money or sex.

Inspectors also found that some Unicom leaders were using their positions to give valuable contracts and opportunities to family members or friends from their hometown.

Evidence on some of the company’s management-level employees has already been passed to higher authorities, and criminal investigation is underway. But for its part, China Unicom has admitted wrongdoing. Earlier this week, the company announced a 45-step reform plan that includes harsh measures like passport controls (presumably to ensure employees aren’t abusing their position for international travel).

Meanwhile, China’s other major telecoms are likely gearing up to feel the squeeze. China’s anti-graft authorities have already announced that they’ll be looking hard at China Mobile and China Telecom once the Spring Festival holiday ends. And at all three companies, high-level heads are likely to roll if corruption is uncovered: Chinese officials fired more than 70 senior management level employees at state-run firms last year after similar investigations.

The move to clean up China’s telecom companies is a part of Chinese president Xi Jinping’s broader anti-corruption campaign. The campaign has already claimed high-level scalps, and there is no reason to think that executives at China’s telecom companies will be immune to the crackdown.

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