A US based client of ours recently had me conduct a talk on how its people should conduct their business in China, from a legal perspective. I am not going to go through most of what I talked about because it is too legalistic and too tailored for this particular client and we have covered much of the rest on this blog already.
But I do want to relay what I talked about in terms of the general attitude i advised this company to have towards the law in China and towards the government which enforces the laws.
I started off by talking about how Western companies often unwittingly find themselves under a spotlight in China and how the likelihood of that happening has seemed to increase. The Chinese media loves to be able to write about a Western company that is involved in a labor/wage issue or an environmental issue or a bribery issue or, best of all, a food safety issue. China’s vibrant blogging and micro-blogging communities love writing about these issues as well. Since the client before whom I was speaking has a fairly recognizable name, I talked of how this made it an even “juicier” target.
I was asked what the company might do to make itself a less “juicy” target and I said that I thought the best things it could do would be to try not to stick out for anything other than the quality of its products and to make sure that the local government knew it was there and providing China jobs and to do so now, rather than when it first needs government help.
I also talked about how this company needs to realize that abiding by Chinese standards is not going to be enough. Instead, wherever possible, it should strive to abide by the same standards in China as it does in the United States.
Way back in early 2006, I did a post where I talked about the need to avoid giving the Chinese press/public an opportunity to accuse you of lack of concern for China:
We are aware of a large Fortune 500 retail company that is opening units in China that meet or exceed the toughest United States environmental laws. I estimate this company’s environmental sensitivity will cost them at least an additional $25,000 per unit, yet I am firmly convinced this company is doing the right thing. This company’s actions make sense because the odds are good that China’s environmental laws and enforcement will get tougher over time, and building environmentally sound units now will almost certainly cost less than having to retrofit existing units a few years from now. On top of this, people often get very emotional about the environment and I can see Chinese citizens getting very angry at a foreign company whose units in China are less environmentally sound than their units in the United States or elsewhere. This is obviously even more likely to be the case if there were to be some sort of environmental disaster.
This is even more true today than then.
What do you think?
