Corruption Report
Title: Business Corruption and Cracking Down
By: Jeff Rocero
China has a complex business system and corruption is widely seen within this sector. China’s
politically connected tycoons have cashed in on China’s real estate boom;
nearly half of Forbes’ list of the 100 richest individuals in China in 2004
were real estate developers.[1] More significantly, Chinese societal rules
change depending on one’s position. Nepotism, corruption, bribery and
blatant favoritism are all included with the corruption that is being seen within China. The main way to become successful in
business is to know people that are higher up. There is corruption because people are
getting picked based on ties and not on how well or how skilled they are at a
job.[2] Corruption in Business is mostly seen through those who receive high
ranking positions in the business sector due to the familial ties instead of
based on merit. Business corruption is prevalent within China and with Chinese
officials. The corruption in China business is a serious concern and needs to
be dealt with, especially in terms bribery.
Almost
every day the Chinese government arrests someone. A few years ago, it was the
Communist Party secretary of Shanghai, Chen Liangyu. Recently the mayor of
Shenzhen was sacked. The country's richest man, Huang Guangyu, founder of the
electronics retailer Guomei, was arrested. [3] All of these leaders have
been charged with taking bribes and many more continue to be arrested and chargedn for bribery. First, many employees
are not loyal to the companies they work for. They think of themselves as
free-agent entrepreneurs who use their employers as a way to make money, for
themselves and for their guanxi social-circle network.[4]
Guanxi, which is what most of what China business follows aids in the corrupt
that is seen within business. The practice of guanxi plays a role in the way
that business corruption is being
Guanxi
is a cultural tie with china, it is the concept representing the
conduct and the process of conduct of soliciting, receiving, offering or
delivering a service by one party to another.The receiving or deliver a
service usually comes in the form of money, as a way of giving thanks to their
guanxi network. Guanxi can also be used to describe a network
of contacts, which an individual can call upon when something needs to be done,
and through which he or she can exert influence on behalf of another. Guanxi
practice bolsters up that person ties with another, and there family receives
the advancements as well. This connection relies on social connections
made between two parties. Guanxi often leads to corruption in that it is
hard to distinguish boundaries between business and social lives, and often time
those working in business hire those closest to them, rather based on their
merits or how experienced they are in that field. There
have been examples of corruption within business and is getting cleaned up. The newer generation is focused
more on keeping it as less corrupt as possible. The good news is that
commercial corruption is decreasing. Executives are starting to see that they
can make more money conducting business honestly. Younger executives,
especially ones who have studied abroad, know about Western business practices and will implement what they have learned abroad into the business of China, this will make the country more transparent and less corrupt.
Endnotes:
[1] Minxin Pei, "Dark side of china’s
rise," Foreign Policy 153 (2006): 32
[2] "The way of Chinese
business," Manufacturing Engineer 86 no. 5 (2006):20
[4] Ibid.
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