Taking Stock

An Essay by Georges Enderle

Why Ethics in China

“An ideal person is not a tool.”Confucius in Analects 2:12


When I began to teach business ethics at the China Europe International Business School (CEIBS) in September 1996, I was excited and eager to dive into a new world and a pioneering job. Compared to my European background and my recent experiences in the United States, it was really new and challenging to teach Chinese MBA students in China and familiarize them with a way of thinking that takes ethics and values in business seriously. On the one hand, I didn’t want to impose my western view of ethics like a kind of modern management technique, but tried to make the students reflect on their own sense of ethics and responsibility. On the other hand, I wanted to share with them experiences and insights we made in western countries with regard to business ethics.

While life on campus was amazingly peaceful, the way to and from campus was adventurous and fraught with surprises for those who had to travel to downtown Shanghai. Heavy traffic jams and seemingly endless road construction projects made it very hard to arrive at the destination on time. However, while riding in taxis I could contemplate traffic in China, which, for me, has become a telling symbol of how Chinese people are able to get through a big mess without too many accidents. Chinese exist in a kind of chaos where progress is needed on so many fronts at the same time: establishing the rule of law; improving education; setting environmental standards; enhancing economic productivity; the list goes on. Sitting amidst a traffic jam, the inexperienced foreigner fears to immediately clash with any vehicle, bike, or pedestrian because they are moving in all directions. Yet, a seasoned driver keeps his car under control, moves step-by-step, and finally gets out of the “Gordian knot” without cutting it into parts.

Of course, this doesn’t mean for business ethics that, when facing ethical dilemmas, one should just let the traffic go. Here too, a seasoned driver is necessary, and to become one, one needs training. I wanted to expose my students to real life ethical dilemmas and cases. But, unfortunately, there were practically no Chinese business ethics cases published in English. I asked my students every year to prepare, in groups, mini-cases and present them in class. They had to pick ethical issues in business based on their own experience or taken from the media, and clearly identify the real ethical problems involved in these cases. The exercise aimed primarily at raising their ethical awareness without jumping to quick fix solutions. To give a flavor of these problems, I mention a few examples from the long list of mini-cases:

• Ethical challenges during the internship: Should a MBA student tell the truth to the general manager about a real operational situation that was discovered during the internship program?

• Guanxi in hiring employees: Should we act according to the company’s principles of recruiting, or maintain guanxi (network of relationships) with an authoritative official by hiring his relative who is unqualified for the job?

• Environmental responsibility: Should we keep the project of renovating the plant within the budget and postpone the set-up of the waste water treatment?

• Bribery: Should the new employee inform the general manager that his superior take bribes?

• Respecting the law: If the government levies higher import tariffs and thus sales decline, should the auto company sell cars to unauthorized dealers while knowing the dealers will smuggle cars into China?

In addition to raising ethical awareness, I tried to familiarize my students with some important ethical theories. A selection of sentences from the Analects of Confucius served as a basis for discussion. Here are a few sentences that caught our particular attention: the Golden Rule, which we can find in all major ethical traditions, “What I don’t want others to do to me, I do not want to do to others” (Analects 5:12). A reminder for each teacher and student of ethics: “I can do nothing for those who do not ask themselves what to do” (Analects 15:16). A challenging comparison between Confucius and Kant: “An ideal person is not a tool” (Analects 2:12). Does this mean that “an ideal person” is not only a means but an end in himself or herself who should be treated, as Kant stated in his Categorical Imperative, “never simply as a means, but always at the same time as an end” (Groundwork of the Metaphysics of Morals, chapter 2)?

A third objective of business ethics as I understand it consists of improving moral skills and the ethical quality of decisions and actions. As Confucius stated, ethics is about the question as to what I and we should do. Elaborating various options is insufficient from the ethical perspective because, at the end of the day, one has to choose one of those options and should be able to give good reasons for one’s choice.

I was teaching in Shanghai during the SARS crisis in spring 2003, which provided a backdrop for exploring the issue of transparency and honest disclosure in business. Because the Chinese government withheld information about the crisis, there was widespread fear and hysteria among the people. People worried that you could catch SARS by simply looking someone directly in the eye. I have vivid memories of standing in crowded elevators where everyone was wearing a surgical mask and avoiding eye contact. One consequence of the government response to the crisis is that my students came to understand and articulate the value of transparency in business.

Students grappled with the difficult issues related to the transition from a communist system to a more open economy. One half of my students were employed by state-owned industries. While they came to recognize the need to increase productivity, they were very reluctant to recommend that workers be fired. They were keenly aware of the potential for economic change to hurt people, particularly when lay-offs would impact older female workers who would find it difficult to find other employment.

Another vexing issue for students was that of plagiarism. One semester, there was a scandal involving a large number of students (both Chinese and European) who downloaded answers to an economics exam from the Internet. My students saw nothing wrong with the practice and were surprised when the school took serious measures against the offending students. In China, information is thought of as a public good, not a private good, so it will take some time before the culture develops a respect for private property rights.

Like traffic in China, attitudes will not change overnight. But, fortunately, religious and cultural differences are often less dramatic than they seem to be at first glance.

—Georges Enderle is the Arthur and Mary O’Neil Professor of International Business Ethics.


Copyright © 2005 University of Notre Dame All Rights Reserved Last Updated on: May 27, 2005