Sinopec oils the wheels of overseas growth

On the other hand, partnerships and alliances, while still offering significant expansion opportunities, offer a far less risky and far easier integration of corporate cultures and styles.

At a time when overseas expansion by Chinese companies is increasing, Sinopec's approach should not only be appreciated but also copied. Chinese companies, and not just Sinopec's fellow energy industry players, can learn important lessons from Sinopec's success over recent years.

Above all, growth via partnership leads to a far more sober, rational and, therefore, feasible and sustainable method of expansion. Growth by acquisition often leads to failure not just because of the complexities associated with the quantification of intangible brand value and cultural integration, but also because of the development of an overly ambitious and egotistical senior management. Emotion often trumps logic when a company's leaders eye ever enticing and increasing short-term financial gain via aggressive takeover action.

The likelihood of success through partnership, rather than takeover, will always be higher given the less hostile and often complementary nature of this approach.

More than a few Chinese companies now find themselves with the financial muscle necessary to barge their way into more lucrative European and American markets via the acquisition of a well-known, respected foreign brand. Sinopec's measured, gradual approach to expansion via partnerships, therefore, represents an extremely important route from which these companies can begin to plot a similar, sustainable strategy for overseas expansion.

Sinopec's long-term, cautious approach is a model of overseas expansion that many Chinese companies would be foolhardy not to replicate.

The author is a visiting professor at the University of International Business and Economics in Beijing and a researcher at Nottingham University's School of Contemporary Chinese Studies.