Home Business Ex-Arm chief resigns from board of China’s largest chipmaker

Ex-Arm chief resigns from board of China’s largest chipmaker

by Atlanta Business Journal

The former president of tech group Arm has made a “bitter sweet” resignation from the board of China’s biggest chipmaker as rising tensions between Washington and Beijing puts pressure on the country’s technology sector.

Tudor Brown, who worked at Arm for 22 years and was an independent director at Semiconductor Manufacturing International Corp, announced his resignation in a LinkedIn post on Thursday.

“Bitter sweet day today. After 9 years I resigned from SMIC board,” he wrote. “The international divide has further widened.”

He later changed the post to remove any allusion to an “international divide” and wrote that he was “sad to leave” but had “opportunities to do other things”.

His resignation comes as growing tensions between China and the west, as well as Beijing’s strict zero-Covid policies, threaten to accelerate economic decoupling between the two superpowers.

Brown said he had not fallen out with the company and that “the only thing that’s frustrated me is the lack of travel”. “It’s hard to engage when that goes on and on,” he said in an interview with the Financial Times, adding that SMIC has been a “great company” to work with.

Washington’s expanding sanctions and export restrictions have forced SMIC to abandon plans to manufacture some types of advanced chips and stalled its global growth, with the company’s shares dropping more than 30 per cent in value over the past year.

The US Department of Commerce added SMIC to its “entity list”, an export blacklist that requires US companies to obtain licences to sell technology to businesses on it, in December 2020.

That followed months of US regulatory scrutiny of the chipmaker, with the commerce department saying that sales to SMIC carried an “unacceptable risk” of being diverted to “military end use” earlier that year.

“I’m the last westerner on the board . . . which is inevitable, it’s the way it is,” Brown said. “US people aren’t allowed to be on it because of the entity list. I am because I’m British and I’m freer.”

“Part of my value is that I’m different and I have a different perspective. It’s good to have differences of opinion,” he added.

Officials in the US and allied countries have also been pressuring international chip groups to disentangle themselves from China.

The Financial Times reported this week that Taiwan security officials wanted Foxconn, the Taiwanese electronic component manufacturer, to drop its stake in Chinese chipmaking conglomerate Tsinghua Unigroup, as the country seeks to align itself more closely with the US.

US officials have also urged the Netherlands to ban ASML, the world’s premier manufacturer of the vital lithography equipment required to produce chips, from exporting even lower-end technology to China, according to a Bloomberg report. The country already prohibits exports of ASML’s highest-tech systems to China.

China’s chip sector is reeling from a wide-reaching anti-graft campaign, which has seen at least five executives linked to its largest chip investment campaign put under investigation in the past two months. The probe follows the collapse of Tsinghua Unigroup, which began a court-ordered restructuring last year.

Brown, who co-founded UK chipmaker Arm in 1990 and has been a feature of the British tech scene since, remains an independent director at Chinese electronics group Lenovo, the world’s biggest maker of personal computers, according to his LinkedIn entry.

SMIC did not respond to requests for comment.

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