BUSINESS AND CULTURE IN

CHINA

SUBMITTED BY
ANKITA CHANDEL
ANKITA SINGH
BHUMIKA SINGH
NIDHI RAWAT
RITIKA JAISWAL

DEPARTMENT OF FASHION MANAGEMENT, SEMESTER-I

NATIONAL INSTITUTE OF GFASHION TECHNOLOGY, NEW DELHI

ankita chandel

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Contents
1. INTRODUCTION ............................................................................................................................... 2
2. ETIQUETTES IN CHINA ..................................................................................................................... 4
2.1 Meeting and greeting.................................................................................................................... 4
2.2 Names and Titles ..................................................................................................................... 4
2.3 Body language ......................................................................................................................... 5
2.4 Dining ...................................................................................................................................... 5
2.5 The Seating Arrangements...................................................................................................... 6
2.6 Giving and receiving gifts ........................................................................................................ 6
2.8 Non-Verbal Communication ......................................................................................................... 7
2.9 General Do’s and Don’ts ............................................................................................................... 7
3. CHINESE CULTURE: CUSTOMS AND TRADITIONS ........................................................................... 8
3.1 Religions & Beliefs in China ........................................................................................................... 8
Buddhism ........................................................................................................................................ 8
Confucianism .................................................................................................................................. 9
Taoism........................................................................................................................................... 10
3.2 Chinese Kung Fu (Martial Arts) ................................................................................................... 11
3.3 Chinese Art and Craft .................................................................................................................. 11
3.4 China: holidays and festivals ....................................................................................................... 15
3.5 Traditional Sports & Activities..................................................................................................... 17
4. BUSINESS IN CHINA ....................................................................................................................... 19
4.1 China and the Western World .............................................................................................. 19
4.2 Doing Business with Guanxi .................................................................................................. 20
4.3 Cultural Dimensions and Its Effect on Business .......................................................................... 20
4.4 Evolution of Business in China .............................................................................................. 22
5 CONCLUSION ................................................................................................................................. 26
6 REFERENCES .................................................................................................................................. 28
Culture Crossing ............................................................................................................................ 28
Chinese Culture: Ancient China Traditions and Customs, History, Religion ................................. 28
Doing business in China: Overview of ethical aspects .................................................................. 28

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List of figures
Figure 1: Buddha Statues in Yun gang Grottoes, Datong .......................................................... 9
Figure 2:L Statue of Confucius ................................................................................................. 10
Figure 3: The Immortals Worshipped by Taoism ..................................................................... 10
Figure 4: Chinese calligraphy ................................................................................................... 12
Figure 5: Chinese Cloisonne ..................................................................................................... 12
Figure 6: Embroidery................................................................................................................ 13
Figure 7: Folk toys .................................................................................................................... 13
Figure 8 .................................................................................................................................... 14
Figure 9 .................................................................................................................................... 14
Figure 10 .................................................................................................................................. 14
Figure 11 .................................................................................................................................. 14
Figure 12 .................................................................................................................................. 14
Figure 13 .................................................................................................................................. 15
Figure 14 .................................................................................................................................. 15
Figure 15 .................................................................................................................................. 17
Figure 16: Cultural dimensions ................................................................................................ 21

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 1. INTRODUCTION

The People’s Republic of China (PRC) is the second biggest economy in the world behind the
United States of America and has the largest population of any country at 1.3 billion people.
3 Although still officially a Communist country, China’s economy has changed during the last
quarter of a century from a centrally planned system that was largely closed to international
trade, to a more market-oriented economy that has a rapidly growing private sector and is a
major player in the global economy. Some of the biggest companies in the world are found in
China. Their names largely unknown in the West, some operating in over 50 countries, they
control extraction, manufacturing, supply and distribution networks in many different
industries.

China emerged as one of the world's earliest civilizations in the fertile basin of the Yellow
River in the North China Plain. For millennia, China's political system was based on hereditary
monarchies, or dynasties, beginning with the semi-legendary Xia dynasty. Since then, China
has expanded, fractured, and re-unified numerous times.

Since the introduction of economic reforms in 1978, China's economy has been one of the
world's fastest growing. As of 2016, it is the world's second-largest economy by nominal
GDP and largest by purchasing power parity (PPP). China is also the world's largest exporter
and second-largest importer of goods. China is a recognized nuclear weapons state and has
the world's largest standing army and second-largest defence budget. The PRC is a member
of the United Nations, as it replaced the ROC as a permanent member of the U.N. Security
Council in 1971. China is a great power and a major regional power within Asia, and has been
characterized as a potential superpower.

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 2. ETIQUETTES IN CHINA

2.1 Meeting and greeting

Greetings are formal and the oldest person is always greeted first.

Handshakes are the most common form of greeting when they meet someone. Chinese may
nod or bow instead of shaking hands, although shaking hands has become increasingly
common.
The oldest person is always greeted first as a sign of respect.

During group introductions, line up according to seniority with the senior person at the head
of the line.
 Being introduced
If someone is making the introductions, to introduce your self is considered
disrespectful.
So when it is your turn to be introduced, stand up, smile and look at the people also
being introduced with ease.
After being introduced, you can shake hands with each other and give mutual
greetings, sometimes with an exchange of calling cards.
 Introduce to others
In China, there are many strict conventional rules on introduction to others:
a. The junior should be introduced to the senior first;
b. The male should be introduced to the female first;
c. The inferior should be introduced to the superior first;
d. The host should be introduced to the guest first.
These ways of introduction is to show high respect to the senior, the female, the
superior and the guest.

Man greeting man- Men generally shake hands when greeting and departing, sometimes
accompanied by a nod of the head.

Woman greeting Woman- Most women will shake hands when greeting and departing,
sometimes accompanied or limited to a nod of the head. Good friends and family may engage
in a light hug.
Man greeting Woman - At a first meeting a handshake or nod of acknowledgment will do.

2.2 Names and Titles

Address the person by an honorific title and their surname.

Use family names and appropriate titles until specifically invited by your Chinese host or
colleagues to use their given names.

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Chinese are often addressed by their government or professional titles. For example, address
Li Pang using his title: Mayor Li or Director Li.
Chinese generally introduce their guests using their full titles and company names. Example:
Doctor John Smith, CEO of American Data Corporation.

2.3 Body language

 Body posture should always be formal and attentive as it demonstrates self-control

and respectfulness.
 Snapping fingers or whistling is considered very rude.
 Beckoning or pointing with the index finger is considered bad form. Using your whole
hand, palm flat, is the way to go.
 People beckon one another by extending an arm and making a scratching motion with
their fingers.
 Using your feet to move something or putting one’s feet on the furniture is considered
extremely rude.
 Sucking air in quickly and loudly through lips and teeth expresses distress or surprise
at a proposed request.

2.4 Dining

Business is generally not discussed during meals. Meals are a vehicle for indirect business
references.
The Chinese are superb hosts. Twelve-course banquets with frequent toasts are a Chinese
trademark.
The Chinese sponsoring organization generally hosts a welcoming banquet.

At a banquet or on formal occasions, it’s polite to sample all the dishes, and at the end of the
meal you should leave a little on the plate to demonstrate the generosity of the host. It is bad
manners for a Chinese host not to keep refilling guests' plates or teacups.

It is advised to always arrive exactly on time for a banquet. Never arrive early for dinner. This
implies that you are hungry and might cause you to lose face.
Be prepared to make a small toast for all occasions.
The first toast normally occurs during or after the first course, not before. After the next
course, the guest should reciprocate.
When drinking a toast – tap the table twice, and stand up if it's more formal.

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Chopsticks are used for all meals. Tapping your chopsticks on the table is considered very
rude. Chopsticks should be returned to the chopstick rest after every few bites, when you
drink or stop to speak or when you are finished eating.

A Chinese person making slurping or belching sounds merely indicates that they are enjoying
their food.
The host pays the bill for everyone.
If you are the guest of honour at a dinner, leave shortly after the meal is finished, as no one
will leave before the guest of honour.

2.5 The Seating Arrangements

The place of honour is always to the host’s right on the sofa or in chairs that are opposite the
room’s doors, and this is where the most senior person should be seated.
If the meeting is held around a large conference table, then the guest of honour sits directly
opposite the host. This is particularly common if the meeting is between Chinese and
foreigners, with the Chinese on one side and foreigners on the other.

2.6 Giving and receiving gifts

Present and receive things with both hands.

Chinese people usually do not unwrap gifts when receiving them. It is considered polite in
Chinese culture to open the gifts after you leave.
Older Chinese usually refuse a gift at first to be polite. Offer a second time.

When wrapping gifts, avoid using white or black wrapping paper, and avoid wrapping
elaborately. Consider red or other festive colours.
Do not give flowers, as many Chinese associate these with funerals.
Never give a gift of great value until a clear relationship is established. This would cause
embarrassment and may not be accepted.
Even numbers are considered good luck, with number four being the exception. It is
appropriate to send one gift or send them in pairs.
It is inappropriate to send a clock or things to do with four as a gift, because they associate
with funeral and death. Scissors or sharp things are not proper either, since they symbolize
severing relations.
Small items like books, music CDs, perfumes, cigarettes and candies from your country are
always well received.

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When invited to someone's home, always bring a small gift for the hostess, such as brandy,
chocolates or cakes.
Always give gifts to each member of the Chinese delegation that meets you in the order in
which they were introduced.
Suggested gifts: cigarettes (especially Marlboro and Kent), French brandy, whiskey, pens,
lighters, desk attire, cognac, books, and framed paintings. Give more valuable gifts — like
cellular phones or small CD players — to senior level people.
Give a group gift from your company to the host company. Present this gift to the leader of
the delegation.

2.8 Non-Verbal Communication

Chinese non-verbal communication speaks volumes.

Since the Chinese strive for harmony and are group dependent, they rely on facial expression,
tone of voice and posture to tell them what someone feels.
Frowning while someone is speaking is interpreted as a sign of disagreement. Therefore, most
Chinese maintain an impassive expression when speaking.
It is considered disrespectful to stare into another person's eyes. In crowded situations the
Chinese avoid eye contact to give themselves privacy.

2.9 General Do’s and Don’ts

Do not overreact when asked personal questions regarding marital status, family, age, job or
income, because this is done to seek common ground.

Keep calm when dealing with government officials if tense situations arise. Raising your voice
or getting angry will help with nothing but creating a losing-face situation for all.
Never write things in red ink. It symbolizes protest or severe criticism.
Punctuality is considered a virtue in China (though on average Chinese are 10 minutes late for
engagements). Being on time shows respect for others. Chinese people show up a bit earlier
to show their earnestness. Being on time for your tour or at any other time shows respect for
the guide, and for fellow travellers.
Public displays of affection are frowned upon. Do not back slap, hug or put your arm around
someone’s shoulder, which will make a Chinese feel uncomfortable, since they do not like to
be touched by strangers. Of course you can do so if you are familiar with each other.

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 3. CHINESE CULTURE: CUSTOMS AND TRADITIONS

More than 1 billion people live in China, according to the Asia Society, representing 56 ethnic
minority groups. The largest group is the Han Chinese, with about 900 million people. Other
groups include the Tibetans, the Mongols, the Manchus, the Naxi, and the Hezhen, which is
smallest group, with fewer than 2,000 people.

Culture includes religion, food, style, language, marriage, music, morals and many other
things that make up how a group acts and interacts.

3.1 Religions & Beliefs in China

China has been a multi-religion country since the ancient times. It is well known that
Confucianism is an indigenous religion and is the soul of Chinese culture, which enjoyed
popular support among people and even became the guiding ideology for feudalism society,
but it did not develop into a national belief. It makes the culture more tolerant to others, thus,
many other religions have been brought into the country in different dynasties, but none of
them developed powerful enough in the history and they only provide diverse people more
spiritual support.

According to a latest survey, 85% of Chinese people have religious beliefs or had some
religious practices and only 15% of them are real atheists. The real atheists here refer to those
who lack belief in the existence of deities and do not join in any religious activities. 185 million
people believe in Buddhism and 33 million have faith in Christianity and believes in the
existence of God. Only 12 million people are Taoists, although more than one hundred million
have taken part in Taoism activities before. Thus, it is obvious that the Buddhism has the
widest influence. The other major religions are Taoism, Confucianism, Islam and Christianity.

Buddhism
Being brought into China 2,000 years ago, it was gradually widely accepted by most Chinese
people and developed into three sections, namely the Han, Tibetan and Southern Buddhism.
Buddhism not only brought a different religion, but also brought a different culture. It
influences the local culture on three main aspects: literature, art and ideology.

Many famous poems have ideas from Buddhism and many Buddhist stone statues can be
found, which show its huge influence. It also promotes the countries’ intercultural
communications with foreign countries.

Han Buddhism: With 8,400 temples and 50 thousand monks, it is the largest branch on the
mainland.

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Tibetan Buddhism: As the second large sect, it has 3,000 temples and 120 thousand monks.

Southern Buddhism: Having 8,000 monks and 1,600 temples, this sect has the smallest scale.

Figure 1: Buddha Statues in Yun gang Grottoes, Datong

Confucianism

Confucianism, not a real religion, is just an ethical and philosophical system, which developed
from Confucius’ (great educationalist, ideologist and the founder of Confucianism and private
schools in China) thoughts and later was treated as a kind of belief to educate common
people. It obtained its stable position under the reign of Emperor Wu of Han Dynasty (202BC-
220AD), and became the ideology of the society in the feudal system since then. Based on the
Four Books and Five Classics, the traditions and principles in the Confucianism played an
important role in the formation of Chinese people’s thinking patterns and teaching methods.
For instance, Doctrine of the Mean can be seen on communications among people.

Confucianism has worldwide influence. In many countries and regions of world such the UK,
USA, branches of Confucius Institutes are established in recent years to spread Chinese
culture and expand the language. In China, you can find many Confucius temples, which is an
important place for the candidates for important exams. In Beijing, They hang some red
wooden plates with lucky words in the Confucius Temple in the hope of gaining high marks
and a good future.

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 Figure 2:L Statue of Confucius

Taoism

Taoism, with more than 1,800 years’ history originated in the Warring Period and came into
being in Eastern Han Dynasty (25 - 220). Now about 300 Taoist Temples are scattered around
China, in which about 30 thousand Taoists lived in. Around 5 Taoist schools exist in the country
and two main sections are included in Taoism. In the 1,800 years, Taoism influenced the local
culture deeply, especially on traditional medicine and literature. Based on some theories of
alchemists such as Wei Boyang in Eastern Han Dynasty, different kinds of medicine
prescriptions were created by Sun Simiao and many other doctors. In literature, many
fictional characters are closely related with Taoism, such as the Jade Emperor. Apart from
Mainland China, many Taoists live in Hong Kong, Macau and some foreign countries.

Figure 3: The Immortals Worshipped by Taoism

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3.2 Chinese Kung Fu (Martial Arts)

Chinese Kung Fu (Martial Arts or as popularly referred to as Gongfu or Wushu) is a series of

fighting styles which has developed over a long historical period in China. Nowadays, it is
regarded as a traditional sport gaining more and more popularity and even stands as a
representative for Chinese culture. Styles including Shaolin, Tai Chi and Qigong have many
followers worldwide.

In order to survive in an extremely hostile environment, our primitive Chinese ancestors

developed primary means of defense and attack that included leaping, tumbling and kicking.
Although they knew how to fight with rudimentary weapons made from stones and wood,
fighting with bare hands and fists became essential skills.

The most outstanding and influential schools are listed as follows:

1. Shaolin Martial Arts: Originated in the Shaolin Temple in Henan, this is considered the
premier style in China and is widely spread all over the world. Both of its physical
exercise and mental training are based upon Buddhist philosophy. The Shaolin Boxing,
Southern Fist (Nanquan), Northern Legs (Beitui) and Wing Chun are the
representatives of this school.

2. Wudang Martial Arts: This sect has almost the same fame as the Shaolin. Based at the
Mt. Wudang in Hubei Province, it is developed under the guidance of Taoist theories.

3. Tai Chi: This is a comparatively slow and elegant style originated from the combination
of Taoism, dialectic ideology, traditional medicine and physical exercise. It features
attack by accumulating the strength, conquering the rigidity with the flexility, and
beating action by inaction.

4. Qigong: It is not only a school of martial arts but also a physical and mental exercise
method, which is beneficial to health and body-building. There are mainly two types -
Dynamic Qigong practiced by specific body movements, and Static Qigong practiced
by adjusting the breath and mind.

3.3 Chinese Art and Craft

It is common knowledge that China has a long history and glorious history in both arts and
traditional crafts. These are just two of the many jewels in China's over five thousand-year
culture. The arts and crafts are not only the embodiment of the people's longing for aesthetic
beauty for themselves and as gifts for others, but also great treasures for China and the rest
of the world.
Of all the Chinese arts and crafts, the most representative are Bronze Vessels, Folk Toys,
Embroidery, Calligraphy, Music, Opera, Painting, Cloisonne, Jade, Kites, Lacquer Ware, Paper-

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Cuttings, Porcelain, Pottery, Seals, and Silk. They are not only a vivid reflection of the culture
of China but also the embodiment of both the local people, and of the nation itself.

Bronze Vessels- invented some 5,000 years ago led the

ancestors of modern China from the Stone Age into a new era
- the Bronze Age. The bronzes produced being delicately
decorated with a diverse range of designs and motifs and were
widely used in many aspects of life, such as musical
instruments, ceremonial offerings and weapons of war being
of great significance in the history of China.

China Calligraphy - a highly stylized form of writing - has been developed by many eminent
calligraphers of many different dynasties. Referred to as the 'four treasures of study' (writing
brush, ink stick, paper, and ink slab) are regarded as the indispensable tools when writing.

Figure 4: Chinese calligraphy

Chinese Cloisonne- It is an enamel artwork with the primary colour being blue. It is renowned
for its use of high-quality material, complex manufacturing process and its use of bright vivid
colours.

Figure 5: Chinese Cloisonne

Chinese Jade- has a history of four thousand years. Jade symbolizes merit, grace and dignity
and occupies a special position in people's consciousness. It is used both to decorate rooms,
and as jewelry by people hoping for a blessing.

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Chinese Embroidery- Embroidery is a brilliant pearl in Chinese art. From the magnificent
Dragon Robe worn by Emperors to the popular embroidery seen in today's fashions, it adds
so much pleasure to our life and our culture. The oldest embroidered product in China on
record dates from the Shang Dynasty. Embroidery in this period symbolized social status. It
was not until later on, as the national economy developed, that embroidered products
entered the lives of the common people.

Figure 6: Embroidery

Folk Toys- are items that have a long history and a combination of artistic appreciation and
playful enjoyment, and endowed with numerous meanings that express the people's wish for
a happy and contented life.

Figure 7: Folk toys

Chinese Kites- being delicately made of paper and bamboo have numerous shapes such as
swallow, centipede, butterfly etc. Regarded as an artistic marvel, the kite makers' skill in both
painting and in the design of the kites' flexible flying movement are well renowned.

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Chinese Lanterns- are to some extent the symbol of the country's
extensive festival culture. With long history and interesting traditions,
lanterns now have abundant variations, decorating many festive
occasions.

Figure 8

Chinese Music- dates back to between 7,000 and 8,000 years ago.
Featured with unique melodies within different dynasties and
accompanied with traditional musical instruments.

Figure 9

Chinese Opera- is recognized as one of the three oldest dramatic art

forms in the world. It is a combination of music, art and literature and
is characterized by the unique facial make-up, excellent acrobatics and
has many different regional variations.

Figure 10

Chinese Painting- is divided into three genres - figures, landscapes,

and birds-and-flowers and each type has its distinctive
characteristics. In addition, difficult skills are required to the painters.

Figure 11

Paper-Cuttings- is diversified patterns cut into red paper with scissors.

Different patterns such as monkey, flowers and figures can be cut vividly and
perfectly by some female artisans in rural areas. People paste paper-cuttings
onto their windows and other places to express their hopes and wishes.

Figure 12

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Shadow Puppetry- is the general name for shadow play and the
theatrical property used in the play. All of the vivid shadow puppets,
including the figures and the scenes, are plane and made from leather.
The shadows of these puppets are projected on to a white screen;
meanwhile artists operate the puppets behind the screen to finish this
traditional form of play. As a bright pearl of the Chinese Silk Chinese
folk art, shadow puppetry has a history of more than 2,000 years. Now
it is still very popular. The delicate puppets are favored by tourists as Figure 13
souvenirs.

China Silk- A silkworm produces 1000 meters (3280 feet) of silk

thread in its lifespan of just 28 days and is of great value. Major local
silk products in China are Shu, Yun, Song Brocade and brocades by
ethnic minorities such as the Zhuang and the Dong peoples are well
renowned.

Figure 14
3.4 China: holidays and festivals

China has seven legal holidays in a year, including New Year's Day, Chinese New Year (Spring
Festival), Qingming Festival, May Day, Dragon Boat Festival, Mid-Autumn Day and National
Day.

Chinese New Year- The largest festival, also called the Spring Festival — marks the beginning
of the Lunar New Year. It falls between mid-January and mid-February and is a time to honour
ancestors. During the 15-day celebration, the Chinese do something every day to welcome
the New Year, such as eat rice congee and mustard greens to cleanse the body. They have
family reunions. The holiday is marked with fireworks and parades featuring dancers dressed
as dragons.

Lantern Festival- Falling on the 15th day of the first lunar month, Lantern Festival is the first
significant feast after Chinese New Year, so called because the most important activity during
the night of the event is watching various wonderful Chinese lanterns. And because every
household eats yuanxiao (a rice ball stuffed with different fillings) on that day, it is called Yuan
Xiao Festival. For its rich and colourful activities, it is regarded as the most recreational among
all the Chinese festivals and a day for appreciating the bright full moon, and family reunion.

Qingming Festival (Tomb-sweeping Day)- Qingming Festival (also known as Pure Brightness
Festival or Tomb-sweeping Day), which falls on either April 4th or 5th of the Gregorian
calendar, is one of the Chinese Twenty-four Solar Terms. From that date temperatures begin
to rise and rainfall increases, indicating that it is the crucial time for ploughing and sowing in

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the spring. The festival therefore has a close relationship with agriculture. However, it is not
only a seasonal symbol; it is also a day of paying respect to the dead, a spring outing, and
other activities.

Dragon Boat Festival- Dragon Boat Festival, also called Duanwu or Tuen Ng Festival, is a
traditional holiday observed annually over 2,000 years in China to commemorate Qu Yuan
(340-278 BC), an ancient Chinese patriotic poet. Originated from south China, Dragon Boat
Festival enjoys higher popularity in southern areas, such as Jiangsu, Zhejiang, Guangdong and
Fujian Provinces.
Double Seventh Festival- Falling on the seventh day of seventh lunar month, the Double
Seventh Festival in China, also known as Qixi Festival, is what Valentine's Day to the western
countries. As it is a day of great importance to girls, the event is also called Young Girls'
Festival. Because of the beautiful legend about Niu Lang and Zhi Nu, the festival has been
endowed with the meaning of great romance.
Mid-Autumn Festival- Falling on the 15th day of the 8th month according to the Chinese lunar
calendar, the Mid-Autumn Festival is the second grandest festival in China after the Chinese
New Year. It takes its name from the fact that it is always celebrated in the middle of the
autumn season. The day is also known as the Moon Festival, as at that time of the year the
moon is at its roundest and brightest. People in mainland China enjoy one day off on the
festival which is usually connected with the weekend. In Hong Kong and Macau, people also
enjoy one day off. However, it is not scheduled on the festival day, but the following day and
it is usually not connected with the weekend. In Taiwan, the one day holiday falls on the
festival day.

Chinese National Day- Chinese National Day is celebrated on October 1st every year to
commemorate the founding of People’s Republic of China. On that day, lots of large-scaled
activities are held nationwide. Besides, the 7-day holiday from Oct. 1st to 7th is called "Golden
Week”, during which more and more Chinese people go traveling around the country.
Chongyang Festival (Double Ninth Festival) - Held on the 9th day of the 9th lunar month,
Chongyang Festival is also called Double Ninth Festival. In Chinese, nine is regarded as the
number of Yang (which means masculine as opposed to Yin which is feminine). The ninth day
of the ninth month is the day that has two Yang numbers, and 'chong' in Chinese means
double which is how the name Chongyang was created. It is a day for people to eat Chongyang
cake, drink chrysanthemum wine, climb mountains, and pay homage to chrysanthemums.
Winter Solstice- Winter Solstice (also Winter Festival), one of the 24 Solar Terms, is a
traditional Chinese festival. It usually falls on December 21st, 22nd or 23rd instead of on a
fixed day. On that day, the northern hemisphere has the shortest daytime and longest night-
time. After that, areas in this hemisphere have longer days and shorter nights. During the
Spring and Autumn Period (770 – 476 BC), Chinese people identified the day with an ancient
tool named an Earth Sundial. Throughout Chinese ancient times, it played an important part
as an influential festival, as the proverb goes “Winter Solstice is as important as Chinese New
Year”.

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3.5 Traditional Sports & Activities

It is inevitable that with such a long history China should have developed several unique and
traditional sports and pastimes. While some are practiced widely by the Han minority as well
as the minority groups who make up these groups and reflect their own cultures. As the
country is so large and the various minorities are separated by vast distances it is not
surprising that they have their own special ways in which to express their vigour and
enthusiasm.
Almost all the traditional sports were derived from productive activity. The Mongolians,
Tibetans and Kazaks inhabit vast natural grasslands and horsemanship is vital to their
existence. Consequently their gift for riding and shooting has given rise to their forms of sport.
The people who live in agricultural communities or who rely on hunting for their livelihood
are good at climbing, wrestling, jumping, shooting and so on.

Figure 15

Many of these activities are accompanied by singing, dancing, and instrumental performances
that are art forms in their own right. They are mostly held as part of the festivals like Spring
Festival and other days of significance. The Bamboo Pole Dance of the Li ethnic group is an
example. The participants squat or kneel in pairs opposite each other and hold the end of a
bamboo poles in each hand. The couples bring the poles together and apart in time with the
rhythm of musical accompaniment. Graceful dancers perform between the moving poles,
ensuring that they maintain a rhythm that is in time with the poles so as to avoid being
trapped between them. This is a very skilful and entertaining sight.

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Land Based Sports- Tug-of-War, Ancient Football, Top-Spinning, Stepping on High, Silk Balls,
Firework-Catching, Crossbow-Firing, Wrestling, Shuttlecock, Horse Racing, Bamboo Pole
Dance, Skipping Ropes, Lion Dance, Martial Arts.

Aerial Sports- This will involve the use of swings, ropes and the springboard, etc.

Dragon Boat Racing (Sai Longzhou) - Many ethnic groups in the southern China and Han
People have continued the custom of the Dragon Boat Race for the Dragon Boat Festival. The
Zhuang, Miao, Dai, Bai, and Tujia people decorate the boats to resemble a dragon and shout
their support with drums and gongs. Craftsmen exercise their skills to the full with their
carving and painting to decorate each boat. In competitions the dragon boat race often
appears as a group item. Nowadays the boat is usually around 20 meters (66 feet) long and 1
meter (3.3 feet) wide. A participating team will have oarsmen or oarswomen, a coxswain, a
gong beater and a drummer. The oarsmen will row and keep stroke, following the rhythmical
drumbeats.

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 4. BUSINESS IN CHINA
Chinese society is heavily influenced by the traditional values associated with Confucianism
which promotes a strict system of norms and propriety. This determines how a person should
act within a community, with hierarchy a central theme. In addition, there is little separation
between business and private life in China. These traditional values can have a significant
influence on employees’ behaviour in a corporate setting. The Mandarin term for business
ethics is ‘shang de’. Those committed to ethical business practice are known as ‘Ru Shang’ or
‘Confucianism Trader’, and being so is traditionally thought to be a route to success. The
concepts of ‘guanxi’ and ‘mianzi’ are central to Chinese society and thus heavily influence
business life. The concepts of ‘guanxi’ and ‘mianzi’ are central to Chinese society and thus
heavily influence business life. Guanxi is a deeply embedded system of relationships, personal
connections, contacts and networks. The cultivation of guanxi can be thought of as a form of
significant ‘social capital’ and is not something casually acquired by exchanging business cards
or having a single meal together. Rather, relationships are formed over time and are based
on trust and reciprocity. It is common in China for an employee to take contacts with them
when switching jobs as the guanxi is with the individual, not the company. Trading
competitive information among one’s guanxi network may, in some cases, also be considered
an acceptable practice. Mianzi refers to the concept of ‘face’ – broadly defined as pride or
self-respect, and its corollary – preservation of the self-respect of others. Mianzi is related to
prestige and one’s position in a hierarchy. Direct disagreement or confrontation with
someone – such as a colleague or a person in a position of authority – may cause them to lose
mianzi and is usually avoided. Thus, opinions can be difficult, but not impossible, to gather
from employees because any proposal for improvement could cause their superior to ‘lose
face’ by suggesting that they are in some way deficient

4.1 China and the Western World

Right now, the Chinese economy has characteristics of tight political control and market
orientation, which has created continued development and steady growth. However, deeply
affected by Chinese history, the way o f thinking and doing business is different from the
Western world. The Western culture can be described as individualistic, egalitarian,
information-oriented, reductionist, sequential, “seeking the truth,” and a culture o f
argument. The Chinese orientation is collectivist, hierarchical, relationship oriented, holistic,
circular, “ seeking the way,” and a haggling culture (Hofer, 2007). The contacts play an
important role in America society, but in China, the relationship (Guanxi) is more important
in Chinese culture. China is a relationship oriented society and business success is based on
who you know and what kind of relationships you have.

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4.2 Doing Business with Guanxi

In China, the law does not always provide legal protection, and so Chinese people needed to
develop another way to deal with things that happened in their personal life or business. In
China, under the relationship, people seek information, jobs and favours, and usually they can
get benefits from Guanxi. It is also important for foreign companies to develop Guanxi with
Chinese companies and government organizations. This Guanxi w ill help foreign companies
when they run into problems doing business in China. In addition, Chinese companies w ill
feel more comfortable doing business with foreign companies if they have strong Guanxi
either because they have built a strong relationship with them or they were introduced to
them by someone in their network. Therefore, for Western people who want to do business
in China, building a Chinese network is crucial for success. A good relationship in China would
help ensure foreign business is much smoother, which also comes with all kinds o f other
advantages.

The view of Intellectual property is different in China compared to Western countries. Most
Chinese believe that intellectual property belongs to society, not individuals. Chinese officials
in charge of enforcement do not understand and support intellectual property rights. It is well
known that intellectual property right is the largest legal minefield in commercial
international relations with China, and is probably the most difficult legal issue to solve. One
reason for that is there is no history of patents or copyrights in China. Another reason is that
the Chinese have not developed enough intellectual property for the public to understand
how intellectual property rights protect people and encourage people to create. Some foreign
companies have lost money to counterfeiters in China and they wonder why China does not
protect the logos of foreign firms.

4.3 Cultural Dimensions and Its Effect on Business

China has a high power distance index, i.e. members of Chinese society believe that significant
inequalities amongst people are acceptable. In a corporate setting, the subordinate-superior
relationships tend to be polarised and there is no defence against power abuse by superiors
other than the social expectation, grounded in Confucianism, that superiors are supposed to
exercise their power with ‘ren’ or humanity, and with due regard to the importance of
reciprocity of obligation, even within a hierarchical structure. Individuals in this hierarchical
society tend to accept formal authority and are less likely to challenge their superiors in the
workplace in comparison with cultures where power distance is low (e.g. the UK). That being
said, the recent rise in grassroots Christianity is beginning to challenge inertia about
inequality.

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 Figure 16: Cultural dimensions

The issue addressed by the individualism dimension is whether people’s self-image is defined
in terms of ‘I’ or ‘We’. In individualist societies, people are likely to look after themselves and
their direct family only. In collectivist societies, people belong to ‘in-groups’ that take care of
them in exchange for loyalty. China is a highly collectivist culture where people act in the
interests of the group and not necessarily of themselves. In-group considerations can affect
hiring and promotions in the workplace with closer in-groups (such as family or indeed anyone
to whom one has a guanxi-related obligation) getting preferential treatment. In this cultural
environment, it is not surprising that nepotism and cronyism are common.

China exhibits a high score on the masculinity/femininity dimension indicating that the society
is driven by ‘masculine’ values such as competition, achievement and success, with success
being defined by the winner/best in field. The need to ensure success (often, for the group
and not oneself) is exemplified by the fact that many Chinese will sacrifice family and leisure
priorities to work, and little importance is placed on leisure time. A low score on this
dimension would indicate a ‘feminine’ society – one in which the dominant values in society
are caring for others and quality of life.

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China has a low score on uncertainty avoidance, indicating that the Chinese are comfortable
with ambiguity. This is reflected in Chinese language in which there is space for much
ambiguity and indeed, it is sometimes preferred. In a corporate setting this can be reflected
in the lack of adherence to rules and regulations, and a preference for contracts which are
somewhat imprecise and thus which may be interpreted flexibly to suit the actual situation;
the emphasis is on facilitating the relationship while laws and contracts are of secondary
importance.

China is a highly long term oriented society in which future rewards are sought through
persistence and perseverance. Relationships are ordered by status and the order is observed.
Investment tends to be focused on long term projects as opposed to short term which may
bring quick returns. In a corporate setting, Chinese employees are likely to work hard in
pursuit of rewards in the long run. However, as China has opened up its markets to foreign
investors, there are an increasing number of examples of short termism with regard to
investment horizons of Chinese businesses.

4.4 Evolution of Business in China

The Chinese have been required to deal with the conflict between Marxism and capitalism as
well as pressures to accelerate the pace of change through liberalization. We identify five
distinct stages in this evolution, which we benchmark to China's history. We show not only
how notions of business ethics have changed over the years with the evolution of the Chinese
business infrastructure but also how the concept has grown in importance, as reflected in the
rising attention to Chinese business ethics in academia.

Stage 1: early attempts at modernization (prior to 1978)

Following the founding of the PRC in 1949, Mao Zedong implemented two successive Five-
Year Plans (1953-1958 and 1958-1961) aimed at ending China's dependence on agriculture.
Mao sought to propel China into modernity by collectivizing farms and industrializing much
of the countryside by forcing peasants to work in steel production, for example. These
programs were spectacular and costly failures. During the second of the two Five-Year plans,
known as the Great Leap Forward, tens of millions of people died and economic growth
actually regressed (Hou, 2011). Under Mao, and particularly during the Cultural Revolution
that followed the failure of the Great Leap Forward, the Chinese Communist Party enforced
the Marxist ideology of class struggle by targeting so-called capitalists, intellectuals and
"bourgeois elements". Traditional business goals such as profitability and productivity were
seen as antithetical to the interests of the people (Yiping, 2010), and class-based morality was
the closest thing the country had to a concept of business ethics.

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Stage 2: opening up (1978-1982)

Mao's death in 1976 was followed by a power struggle that ended with the ascension of Deng
Xiaoping. Deng repudiated the worst of Mao's policies and instituted the first in a series of
social and economic reforms aimed at de-collectivizing the countryside, reducing government
control over industry and diversifying the economy. Along with these reforms, China began
to open up to the world in both the diplomatic and economic spheres (Yiping, 2010). At this
time, Chinese consumers tended to purchase products that met Chinese cultural standards
(Wand and Lin, 2009).

Chinese values have formed and retained a clear and consistent system for generations.
Beginning in this period, Chinese businesses became receptive to the idea of a relationship
between business activity and business ethics, though public discussion on the subject was
limited to the academic sphere (Tam, 2002). This discourse focused on the relationship
between economic activity and morality and called for the establishment of moral norms
drawn from Confucian and Daoist theories with the aim of "setting wrong things right" (Fan,
2002). Academic work on Chinese business ethics during this period focused on issues ranging
from accounting standards and taxation to finance and government involvement and set the
study of business ethics in China on the right track (Li et al. , 2009). A typical model of thought
was based on harmony, respect for the past and tradition, modesty, proper order and took a
"being" rather than "doing" orientation.

Stage 3: the learning period (1982-1994)

In 1982, China revised its constitution and adopted a mixed-market economy, or as it is called
in China, "Socialism with Chinese characteristics" (Yiping, 2010; the 1982 constitution is still
in force today). At this stage, the economic reforms, which had focused first on the
countryside, expanded to include economic activity in cities and their environs. Discussions
of business ethics, thus, needed to address not only the commodity production industries
centered in rural areas but also commerce and other professions prevalent in cities. During
this period, the field of business ethics in China was examined comprehensively by Chinese
and foreign academics for the first time in fields including commerce, economics, sociology
and management (Tam, 2002). However, this discourse was still driven by the agenda of the
Communist Party, namely, "strengthening the construction of socialist spiritual civilization"
(Lu, 2009).

Stage 4: new reforms (1994-2001)

By 1993, it had become clear to central decision-makers in the Party that small incremental
modifications of the system would not lead to real economic progress (Li et al., 2009). To
achieve this goal, they needed an institutional overhaul. In 1994, the leadership initiated a
new wave of reforms aimed at establishing a socialist market economy (Yiping, 2010). These
reforms set in motion a period of rapid decentralization and privatization within a framework

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of strong central control (Fan, 2002). The government privatized many SOEs, making them
responsible for their business actions and performance. Other private firms appeared in great
numbers. In addition, the so-called Fenshuizhi reform replaced the old discretion-based
system of revenue sharing with a new rule-based system (Fenshuizhi translates as "tax
assignment system").

As Chinese firms faced market pressures for the first time, inefficient firms closed. Employees
could no longer rely on the "Iron Rice Bowl" system of a job for life; both workers and firms
had to change or perish. In this period of rapid change, ethical issues sparked interest from
foreign academics in various disciplines. The Chinese mass media also broached questions of
ethics for the first time, raising subjects like pollution, product quality and safety at work (Fan,
2002).

The theme of business ethics was most visible in relation to the privatized SOEs and other
large companies. Chinese firms faced a conceptual problem in that they saw each other as
competitors, yet China's collectivist culture and traditional Daoist teachings urged them to
build relationships. The result was a type of "co-opetition" - cooperative competition - that
needed to be managed (Hwang et al., 2009; Tam, 2002; Yang, 1994). Business ethics was seen
as a way to bridge this problem and lead the way to comprehensive prosperity. The 1994
Chinese Company Law did not explicitly refer to Corporate Social Responsibility and Business
ethics, but it echoed some of its components, especially regarding the rights of employees
(Chinese Company Law, 1994 arts. 45 and 68).

Stage 5: setting the stage for global economic leadership (2001-present)

China joined the World Trade Organization (WTO) on December 11, 2001, a move which
meant it had to incorporate Western-style legislation and ethics into its legal DNA. The
reforms of this period required reducing the role of government in the business arena,
strengthening (and implementing) business regulations and establishing procedures to
safeguard property rights. Various scandals involving faulty products, as well as reports of
human rights abuses prompted China to focus not only on technical but also on ethical
requirements for complying with WTO regulations. For the first time, ethics was seen as one
of the building blocks of a business structure for a competitive and diversified economy in
large and small firms alike.

In keeping with China's new role as an emerging global leader, academic interest in Chinese
business and business ethics has soared over the past 10 years (Table I). Academics set the
goal of developing a theory of business ethics which would be both practically relevant and
true to the Chinese cultural context (Lu, 2009). In short, developments in China's economy
from the 1970s to the present, and its acceptance of Western business norms, made its
economy boom and set the stage for China's rise as a global economic power. However, for
many years, developments in politics, business and culture lagged far behind. China's

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leadership understood the need to bridge this gap to maintain economic growth and political
stability. China needed to modernize while avoiding the mistakes of other developed
countries, while keeping its culture intact. Since 2004, corporate social responsibility through
ethical actions has become a prominent issue in Chinese academic and policy reforms. The
leading example is Article 5 of the 2006 Chinese Company Law, which requires companies to
"undertake social responsibility" in the course of business (Chinese Company Law, 2006, art
5). The Sixth General Meeting of the Sixteenth Central Commission of the Chinese Communist
made an important declaration that "building a harmonious society" is the long-term goal of
Chinese Socialism. Table I summarizes the evolution of the Chinese business ethics
infrastructure.

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 5 CONCLUSION

The global balance of economic power is shifting away from the USA and Europe toward Asia.
Attention today is being directed toward emerging countries, especially China, as one of the
major countries to bail out Europe from the current financial - institutional economic crisis.
The early 21st century has experienced two major economic, social and business events of
global magnitude. The first was the global financial crises of 2008 and 2009, which was
preceded by global corporate scandals such as Worldcom and Enron. The second was the
emergence of China as a major global economy, the world's second largest economy which is
slated to be the largest economy, eclipsing the USA within a decade. China, along with many
other countries in the world has begun to adopt a wide range of corporate governance and
ethical reforms (Perraton, 2009; Schrank, 2009; Chu, 2009), which have followed the pace of
globalization. In turn, these changes and the convergence of many business institutions are
behind China's new social market economy. The social market economy in China will take into
account the foundations of its complex institutions and business ethics, which is similar in
many ways to the Communitarian business system in countries in continental Europe and in
Asia, such as Japan and Korea, as well as Anglo-Saxon institutions, such as in the USA.

Country norms are often unique and are deeply influenced by history, institutions and culture.
The use of networks or social relationships has been found to be critical to business success
in many societies, including in Latin America, Asia and the USA. China is no exception, having
a deeply rooted cultural norm of reliance on personal networks. Social network theory
recognizes the social embeddedness of such economic actions, especially in uncertain
environments, which has long been the case in China. The practice of Guanxi as an ethical
business governance system is seen as an outcome of the period of economic reform (a period
of uncertainty) arising from the influence of the "bourgeois individualism" of the capitalist
West and "its ethic of self gain" (Yang, 1994). Given that Chinese firms have only been legally
separated from the government's total control since 1988 and Chinese corporate law has only
existed since 1993, it is no surprise that a native rather than a national mindset still prevails
and that division rather than excessive societal coordination of the business economy is
causing Chinese firms to follow exit opportunities. In China today, large firms often pay more
attention to laws, rules and regulations that are part of the emerging national legal system.
This legal system is slowly being constructed and implemented (Guthrie, 1998; Li et al. , 2009).
As the economic transition progresses, markets in China are becoming increasingly
competitive. There are very real economic incentives to meet the economic imperatives of
quality, price and feasibility of a given project.

The Chinese business system is based on Confucian ethics (Lin and Ho, 2009). Western
philosophy places a greater emphasis on extensional truth and is often defined as a type of
scientific truth grounded in mathematical, logical or empirical knowledge. Extensional truth
can be asserted and separated from subjective attitudes. Confucian - Chinese ethics is a form

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of intentional truth, which incorporates feelings and bounded rationality but is not
completely limited to scientific knowledge. Nevertheless, the evolution of Chinese business
ethics has shown that it has a great deal in common with Western thought. These elements
include loyalty, trust and a certain kind of justice. These elements are important for a healthy
business environment although they may take on a different form.

China's economic and business infrastructure have been transformed within a short span
from a planned economy to a socialist economy (Barbieri et al. , 2010). Like other economies
transitioning from a centrally planned system toward a market-based one, China needs a
healthy and growing private sector, as the government has long ceased to be the primary
source of subsidies or funding for companies. The global financial crisis has added to the
urgency of getting the country's business ethics infrastructure right. Far-reaching and
fundamental changes in China's economic infrastructure and business environment have
occurred in the past three decades (Gu et al. , 2008). China has replaced the centrally planned
market system with legally independent firms (market economy) without changing the
political Communist infrastructure. As the government continues to give firms and their
managers direct economic and legal responsibility for their businesses, increasingly more
business ethics dilemmas are emerging. To improve China's long-term economic performance
and the development of society, it should construct a strong ethical framework based on
educating its managers better. It must find a balance between managing a market economy
through Communist leadership and Chinese culture. It must take into account Chinese culture
and, hence, develop a new set of business ethics tools (Guthrie, 1998). Not enough is known
about the nature of the problems involved in operating and managing a business in China and
how to cope with fundamental managerial issues (Brand and Slater, 2003). Understanding the
impact of Chinese culture on Chinese managers' business ethics and the way to incorporate
it into Western managerial models has important practical implications for managerial
decision-making.

The particularities of modern Chinese culture and history suggest that though Chinese firms
are becoming more independent, Chinese managers' notions of business ethics lag far behind.
However, in an age of global competition, the ethical conduct of Chinese firms is coming
under ever-greater scrutiny by the West, which demands more transparency and Western
standards of ethical behavior (Brand and Slater, 2003). These standards take into account the
interaction between organizational members and situational components based on the stage
of moral development (Trevino, 1986). This determines how an individual thinks about ethical
dilemmas and makes decisions as to what is right and wrong. Traditional Chinese ethics hold
that one should strengthen the tendency to value yi over li . Yiroughly means "fairness",
including fairness in obtaining and distributing wealth. Li is a complex term, but it involves the
idea of "efficiency" and can be interpreted as incorporating benefits to oneself from the
accumulation of wealth (Chan et al. , 2002; Fan, 2002; Hwang et al. , 2009). In contrast,
traditional Chinese ethics is based on person-to-person relations and is not immediately
applicable to firms (Berger and Herstein, 2012; Gu et al. , 2008).

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