Fosun and its "key man risk"

When the reported disappearance of Guo Guangchang, chairman of China’s biggest privately owned conglomerate Fosun Group, rippled through markets and tumbled Fosun-related stocks late last week, it also exposed the so-called “key man” risk for investing in Chinese companies.

Guo, the billionaire co-founder and chairman of Fosun Group, which runs businesses from insurance to pharmaceuticals, was reported to have gone missing, according to a report by Chinese financial publication Caixin, citing unidentified sources late on Thursday.

The group immediately suspended trading of six of its listed companies in mainland China and Hong Kong, including Fosun International, Shanghai Fosun Pharmaceutical, Nanjing Iron and Steel and Hainan...