Despite the prevalent role of guanxi in conducting business in Chinese, it is unclear whether interpersonal guanxi fosters interfirm trust. Taking a contingency approach, this study examines how institutional (government–market relationship and Buddhism influence) and individual (relative role performance and the span of partner control) factors moderate the association between interpersonal guanxi and interfirm trust. Based on a paired survey between salespersons and sales managers and two secondary datasets, this study finds that interpersonal guanxi is positively associated with interfirm trust. (...) Moreover, this positive effect is stronger when firms operate in regions with strong government–market relationships and strong Buddhism influence. In addition, the positive relationship is weaker when guanxi resides in boundary spanners who have relatively high role performance, but becomes stronger when boundary spanners have a broad span of partner control. These findings highlight the situations in which guanxi at an interpersonal level is more or less likely to foster interfirm trust. (shrink)

This study examines the tensions between the western concept of professional independence and accountants’ commitment to significant others under the care perspective of guanxi. The principle of professional independence is founded on arm’s-length transactions to avoid undue influence on professional and ethical judgement. However, in the relational society of China, social interactions based on Confucianism elicit a duty of care and concern towards significant others in important relationships. For a professional accountant, the commitment to persons with whom they have guanxi (...) is potentially at odds with their commitment to professional independence. Data collected from interviews with Chinese accounting professionals, accounting academics and expatriate accountants working in China provide insight on how Chinese accounting professionals discharge their obligations under guanxi. Notions of guanxi and the rules of exchange identified in Hwang’s (Knowledge and action: A social psychological interpretation of Chinese cultural traditions, Sin-Li, Taipei, 1995) model of “Confucian ethics for ordinary people” provide the lens to explain the ethical dilemmas facing Chinese accountants. The findings suggest that accounting professionals prioritise the interests of their superiors and clients over the users of financial reports. Despite accountants’ moral obligation to protect the public interest, personal and professional obligations in China struggle to extend beyond client or employer interests mostly because of the absence of a formal relationship or connection with the public. This contrasts sharply with the notion of professional independence practised in western societies, where accounting professionals must be independent of their clients and superiors and commit to a duty to protect the public interest. The outcome of this study demonstrates the impediments to transplanting western concepts to different cultures. (shrink)

This study focuses on comparison of perceptions of ethical business cultures in large business organizations from four largest emerging economies, commonly referred to as the BRICs (Brazil, Russia, India, and China), and from the US. The data were collected from more than 13,000 managers and employees of business organizations in five countries. The study found significant differences among BRIC countries, with respondents from India and Brazil providing more favorable assessments of ethical cultures of their organizations than respondents from China and (...) Russia. Overall, highest mean scores were provided by respondents from India, the US, and Brazil. There were significant similarities in ratings between the US and Brazil. (shrink)

Social relations are predominantly influenced by an exchange paradigm whereby the logic of reciprocity shapes behaviour. If the notion of exchange instrumentalism is common across different business disciplines, this does not deny attempts – such as through gift exchange theory – to present different conceptions of traditional exchange-based relations. Gift exchange theory appears promising as it seeks to establish more meaning and significance to the nature and context of exchange relations between human actors or parties. The underlying processes may be (...) different for gift exchange and more traditional economic-based exchanges, but the general outcome remains the same – the obligation of reciprocity between actors. In this article, we develop an alternative conception of social and business experience that transcends the dominant logic of exchange: the existential gift. Firmly embedded in the idea of giving for its own sake, the existential gift suggests that for some individuals the expectations of reciprocity are neither sought nor established. Generosity that is expressed in both tangible and intangible ways need not depend on the response of intended receivers or recipients to precipitate future acts of giving. Based on the logic of unconditionality, the existential gift provides human actors with greater freedom in their choices and relationships. It may well be that this freedom, in turn, creates a new ‘ethic of generosity’ whereby significant progress can be made towards developing more human models and practices in business. (shrink)

Thomas W. Dunfee, in addition to his many other contributions to business ethics literature, has generated a stream of research that attempts to tackle the issue of corruption. Dunfee's research on corruption includes three primary contributions: the introduction of "Integrative Social Contract Theory" which provides a normative theoretical framework by which to judge the morality of global business activity including corruption; the "C2 Principles", which outline specific content and implementation measures that corporations can voluntarily adopt to combat corruption; and a (...) normative evaluation of "guanxi," a concept which can lead to questionable corruption practices in China. The article will highlight Dunfee's contribution to the literature and suggest future research directions based on his academic work. (shrink)

This paper explores expatriates’ ethical evaluations of and responses to guanxi in China through the lens of integrative social contracts theory. We conducted in-depth interviews with 14 expatriate managers who had spent, on average, 6.5 years working and living in China. Based on the content analysis of these interviews, we identified two different uses of guanxi: defensive and competitive. In general, the respondents found defensive guanxi moral in the Chinese context, while they considered competitive guanxi immoral. Based on our findings, (...) we identified fair competition as the substantive hypernorm that governed most respondents’ ethical evaluations of guanxi. The study has implications for all scholars who seek to utilize integrative social contracts theory to study the relationship between informal networks and corruption in developing countries. (shrink)

Guanxi, or social networks common in Confucian cultures, has long been recognized as one of the major factors for success when doing business in China. However, insider networks in business are certainly not confined to Asian cultures, nor is the attendant possibility for corruption. This study obtained original data to investigate current Taiwanese perceptions of (1) how guanxi is established and cultivated; (2) how guanxi actually is practiced now and people’s acceptance of it; and (3) the effects of guanxi on (...) business operations, employment/promotion, and social justice and fairness. The researchers also hope to (4) verify some arguments made by pioneering researchers. The authors speculate on how these attitudes may affect behavior in business transactions in hopes of making readers more aware of differing cultural values that may create unexpected ethical dilemmas. They suggest that professional ethical codes should provide guidance on the practice of guanxi in a Confucian society and that special emphasis or training in interpreting those codes may be required. (shrink)