Tea with the dragon: traditional Chinese ethics and contemporary Chinese business

The need for business executives and government officials to understand and communicate with their Chinese counterparts has become a matter of great urgency. Whether you believe China and the West are “destined for war,” allies, or “strategic competitors,” whether you believe the 21st century belongs to China or you think China is heading toward cataclysmic economic and social collapse, whether you believe new social media platforms like WeChat undermine the Communist Party’s grip over civil society or you think the government will use new technologies such as facial recognition to tighten authoritarian control, whether you are a human rights advocate or a business executive eager to do deals, whether you think China exacerbated the global death toll of COVID-19 by suppressing information about the virus or you believe it was the victim of xenophobia and racism, the need for mutual understanding and effective intercultural communication has never been greater.

The year 2020 marked perhaps the most perilous and contentious moment between China and the West since the 1989 Tiananmen Square massacre. China’s crackdown on democratic protests in Hong Kong raised global human rights concerns. News headlines offer a daily drumbeat of saber rattling, trade sanctions, and retaliations. Some of China’s most important global technology companies like Huawei and TikTok have prompted security concerns among a number of Western nations. Because of these rising tensions and the impact of the COVID-19 virus, the number of Chinese students studying in the West has plummeted and so has travel by Westerners to China for business, education, and tourism. In many respects, this book, emphasizing as it does the importance of understanding traditional Chinese culture, would seem to be coming out at the worst time, when China and the West are at loggerheads. While we are mindful that the conflicts between China and the West are real and unlikely to dissipate anytime soon, we are nonetheless hopeful that if Westerners absorb the ideas and lessons of this book, they will be in a much better position to manage those conflicts in a manner that will minimize the potential for human suffering and economic destruction on both sides, and perhaps even help illuminate a path to areas of common interests.

This book elucidates some central ideas in the most essential writings of traditional Chinese culture with the purpose of helping Westerners to communicate more effectively with their Chinese counterparts, in particular about difficult and contentious business ethics issues. It is specifically addressed to business executives, but it should also be of interest to government officials, educators, and students. It is a book about the continuing relevance of traditional approaches to ethics in contemporary China. We use the term “traditional” not as a euphemism for “pre-modern,” “primitive,” or simply “old," but rather to highlight traditions in thought and behavior that have been, and continue to be, enduring aspects of everyday thinking, behavior, and culture. We draw on classics of literature and philosophy written and transmitted steadfastly over the course of millennia. By focusing on the most essential ideas in traditional Chinese culture, we open a window for Westerners who want to understand Chinese approaches to ethical thinking and decision-making, and how they affect business behavior and other interactions with foreigners. We apply the principles set forth in the book to three business ethics topics of enduring interest to business executives, government officials, and academics, namely, the protection of intellectual property, assurance of product safety and quality in the pharmaceutical supply chain, and human rights.

A central theme of this book is that engaging with Chinese perspectives on ethical thought and behavior does not amount to a relativistic “going native" or, as the old adage goes, “when in Rome, do as the Romans do.” To the contrary, as we shall demonstrate, familiarity with the basic tenets of traditional Chinese culture is an essential component of effective advocacy for bedrock ethical, human rights, public policy, as well as business principles and interests.

As frustrating and unjust as it may be for human rights advocates and business ethicists to accept, the plain fact is that traditional Chinese culture does not emphasize the welcoming of foreign cultural perspectives, freedom of expression, being a cultural melting pot, resisting religious persecution, or correcting political injustice. For millennia, China has functioned through centralized authoritarian bureaucracy controlling the populace, politics, and the economy. Entry-level notions in Western approaches to ethics—such as equality, liberty, property rights, human rights, and maximizing happiness—are just that. They are not entry-level notions in Chinese approaches to ethics. This is crucial for understanding why, as many managers of Western multinational companies report from working in China, demands and justifications for ethical behavior that make sense to Westerners seem to fall on deaf ears in China.

What counts as ethics in the first place, and hence what counts as a justification for why some decision or act is ethical or not, are not even recognizably the same in many cases (Roetz, 2009). To take a general example, the claim that some act would be wrong because it does not treat others equally would be unrecognizable as a justification for ethical wrongness in a Chinese cultural-philosophical context. Whereas Western perspectives on what is just often hinge on notions of what is fair and equitable, Chinese perspectives on what is just hinge on the particular nature of the relationships between and among individuals and groups. Thus, from a Chinese perspective, what counts as just treatment of a business partner would depend, not on their status as a human being or on them (simply) being a partner, but on how long one has known them and how personal the relationship is.

Our motivation for writing about traditional Chinese culture is not to exalt cultural excuses to mistreat workers, take quality and safety shortcuts, or justify intellectual property theft. Rather, we believe it holds the key to achieving progress on these very contentious issues. It is a paradox to be sure, but one we embrace wholly. It is a fundamental premise of this book that to achieve progress on these bedrock Western and modern business practices and ethical precepts, one must learn to be agile with respect to traditional Chinese culture. Indeed, importance of developing a capacity for such cultural “agility” is one of the main takeaways of this book.