Gaunxi Corruption Summary

Topics: Business ethics, People's Republic of China, Political corruption Pages: 2 (312 words) Published: June 22, 2014
Guanxi Corruption Summary
The article, “Does the Chinese practice of Guanxi lead to corruption in business?“, claims that it is impossible to do business in China without corruption while making a fair profit. China’s business environments is full of corruptions and bribes. The communist party in China plays a huge and sometimes radical role in the Chinese business industry. It is advised for Multinational Companies (MNCs) to create relationships with the Chinese government. This is part of the guanxi concept China operates under. Guanxi is a personal network of connections or relationships. This can be a mutual relation for mutual benefits or a family bond not easily broken. Guanxi is your realm of influence in the Chinese world. From a western point of view, operating business under guanxi invites corruption but this concept is perfectly normal and ethical to the Chinese. Western norms alone do not thrive in the Chinese industry, so it’s important for western companies to incorporate guanxi to their business model. Guanxi and corruption aren’t as linked as most western cultures would believe. Gaunxi is not so unusal,, in fact it can be a very fair and useful tool to benefit your business. However China is notorious for its corruption in business affairs. Guanxi becomes corrupted when business exchanges or practices falls outside of the governing laws. So the Guanxi network doesn’t necessarily lead to corruption, but rather unethical business practices. To minimize corruption, this Article suggest for MNCs to be hands on in developing a systematic guanxi network. Management of this network should not be outsourced but rather managed and invested in by the company itself. By doing so you can lever your network and influences into a mutual benefit outcome. Works Cited

Lane, Scott. “Does the Chinese practice of Guanxi lead to corruption in business?.” n.d....

Cited: Lane, Scott. “Does the Chinese practice of Guanxi lead to corruption in business?.” n.d.
http://www.ethic-intelligence.com/experts/273-does-the-chinese-practice-of-guanxi-lead-to-corruption-in-business-practices/
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