Alibaba says it will demote top executive

Alibaba is removing Taobao and Tmall President Jiang Fan from his partnership position. It said the decision, announced on Monday, followed a family situation that had a major impact on the company’s reputation.

Following an internal investigation, Jiang will be demoted to vice president from senior vice president, with management level down from M7 to M6, and he will be deprived of the last financial year's bonuses.

He is to be excluded from the partnership of 38 senior executives or founding members, including Founder Jack Ma, Chief Financial Officer Joe Tsai and Board Chairman Daniel Zhang, that has the final say over major business decisions and the appointment of board members.

"As an important executive, Jiang's failure to manage family relations has caused a public consensus crisis and damaged the company's business reputation," Alibaba said.

Last week, Jiang’s wife accused an online shopping and fashion influencer Zhang Dayi of "messing with" her husband.

Zhang was one of the earliest models-turned online personalities to promote clothing through Taobao stores.

She is a major shareholder and chief marketing officer of NASDAQ-listed Ruhnn Holdings, which specializes in connecting online celebrities with online vendors to promote sales.

Alibaba found there had been no business interest transfer between Jiang and Zhang Dayi or her company.

Jiang, who had been overseeing Alibaba’s mobile strategy, had not been favoring or transferring business benefits toward online stores managed or promoted by Ruhnn Holdings, the e-commerce giant said.

Alibaba said its decision to invest in Ruhnn Holdings in 2016 had nothing to do with Jiang.

Jiang joined Alibaba in 2013 after the company acquired his mobile app analytics startup Umeng.