Business Etiquette in China

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of the Government of Canada.

Introduction
Chinas culture and business practices differ from Canadas. As you start or
expand your business in China, having an understanding of Chinese business
etiquette is important to your success. Knowing and practicing common
customs will also help you relax, avoid embarrassment, and focus on the
matters at hand on critical occasions. This document provides a brief set of
guidelines on Chinese business customs and practices based on queries that
have been received by Trade Commissioners at our Embassy and Consulates in
Greater China. For further information, there are reference links at the end of
the document. While nothing can beat your own personal experience, we hope
that this information will be of assistance in sensitively guiding your activities.
In your business dealings in China, you will make many friends, both Chinese
and foreign, who can help you learn the ropes. Follow their advice and
example! The toughest business people you encounter will often also prove to
be genuinely warm and accommodating hosts, and will overlook simple errors
of table manners or business etiquette as we would in Canada if your
purposes are serious and your conduct respectful.

Background
Before beginning, recognize that the following qualities are valued by the
Chinese and therefore relevant to your Chinese business interactions today:

Saving and giving face

Respect for elders and rankings (note that the latter is particularly
important when dealing with government officials)

Patience

Politeness

Modesty

Approaching Business in China

Top tip: Business in China relies heavily on personal relationships: make sure
you have some!
Doing research on the market is important in China, but personal relationships
are equally essential to business success here. It is crucial to establish and

maintain good relationships with key business contacts and relevant

government officials. Attending industry networking events, contacting
industry associations and municipal or provincial investment promotion bodies,
and following up on personal introductions are all good ways to start the
relationship-building process.
While many Canadian firms have done business successfully with credible firms
in China, it is important to remain aware of potential scams that you may
encounter as you approach business in China.[1]
For further information on scams that can affect your business, please see
our report on the Trade Commissioner Service website regarding frauds and
scams.

Attending and Conducting Meetings

Top tip: Dont be late, and know whos boss!
In general, meetings in China follow the same format as those in Canada,
albeit with a bit more ritual. The Chinese value punctuality, so arrive on time
or even slightly early for meetings or other occasions. The following points
should be kept in mind:

Dates: Check the Chinese calendar. If you are scheduling a meeting,

avoid all national holidays, especially Chinese New Year, when the entire
country effectively shuts down and it can be very difficult to organize
meetings with key individuals. The May 1 and October 1 holidays also
affect businesses: be forewarned.

Preparation: Be well prepared in advance of your meetings. Your

Chinese hosts will most likely know you and your business quite well.
Have a detailed proposition of the value of your company and product;
your counterparts will have one for you (see section below on
Materials). Chinese businesses often meet with numerous foreign
businesses seeking to establish relationships; if you are unable to
capture their attention at the first meeting, you may not be able to
secure follow-up.

Language of the meeting: Make sure you know the language

capabilities of your hosts before the meeting. It is more convenient and
reliable for you to have your own interpretation if your hosts don't speak
English or have little English capability.

Meeting room set-up: If you have specific requirements for a meeting

room set-up (e.g. projector and screen), be sure to communicate this to
your hosts in advance of the meeting. They are usually happy to
accommodate, but often do not have the in-house capacity to set up the
technology on the spot.

Materials: Have Chinese-language materials (e.g. brochures,

presentations) about your company to share with your hosts. While your
contact in the organization may speak perfect English, the decision
makers in the company may not. It will be challenging for your
interlocutor to convince others of your company or product's value if they
are not equipped with Chinese materials.

Dress Code: Government officials and top management dress formally

for meetings, while business people at working levels may adopt a more
casual style. If youre not sure, go formal it will convey respect and
seriousness. In the summertime, there can be a suggestion for men to
go casual. This means polo shirts or button-down short sleeve shirts, as
opposed to suits and ties (or shorts which are definitely not
appropriate).

Introductions:
o

Addressing others: Seniority is valued in China. It is important

to address your counterparts by their title (Chairman, Director,
etc.). Find out who the most senior person in the room is, and
address them first.

Introducing yourself: Say your name clearly, and remember

to state both the company you work for and your position. As a
point of reference, know that Chinese will refer to their company
first, then their title, and then their name when introducing
themselves to others.

Handshakes: As in Canada, meetings often start with

handshakes. Ensure that you are not too aggressive with your
handshake. Dont be surprised if you are at the receiving end of
a decidedly non-aggressive handshake. If things go well, you
may also be on the receiving end of a prolonged handshake:
anything goes. In western business contexts, you have probably
found yourself in squeezing contests (among men): who has
the stronger grip? In China, the question will be who lets go
first? Dont be shy about holding on if your counterpart is
enjoying the contact it is meant well.

Giving/Receiving business cards: Similar to introductions,

hand out business cards to the most senior official first. Chinese
use both hands when giving and receiving anything of value,
including gifts and particularly business cards; you should do the
same as this is one of the first points at which you will make an
impression. Take a moment to look at and acknowledge the
individuals card. Have your own cards translated into Chinese
on one side. Your title is important; this is how your hosts will

determine who should be invited to meetings, what weight your

words carry, and where you will be seated.
o

Your name: Having a Chinese name, ideally one with meaning

rather than a transliteration of your English or French name will
be taken as a sign of respect as well. The best approach is to
have a local contact or native speaker help create one for you. A
link to an online Chinese name creator is provided at the end of
the document under Useful Links.

Seating Arrangements: The host will take the lead, and you will likely
have a name card or designated seat based on your role in the
organization.

Meeting structure: Particularly in government circles, meetings may

follow a fairly formal structure, with the senior member of the hosting
party introducing himself/herself and colleagues, and then proceeding to
state his or her views and position on the matter in question. Following
this, the leading member of your party should do the same. Subordinate
members of the Chinese party will not usually speak unless asked to do
so by the most senior person; your observance of the same protocol
(even if your management style permits a more fluid approach) will have
the advantage of conveying who is in authority and who, within your own
team, may have special expertise or authority in a given area.

Dining
Top tip: Follow the leader!
Business often gets conducted during meals. As with business meetings, food
and seating are determined by the hosts. The following points should be kept
in mind when dining formally with the Chinese:

Beginning to eat: Follow cues from your hosts and start eating when
the hosts begin. There will be cold dishes placed on the table when you
are seated; wait to be invited before you dig in.

Keeping pace: At formal banquets and high-end restaurants, serving

staff may keep up an almost constant rotation of dishes. They will also
change your plate frequently with a clean one, so as not to mix dishes
and flavours. While at first this may be distracting, accept the rhythm
and you will soon cease to notice it. In order to have a sense of what is
coming next, know that the meal will proceed with meats of various
varieties and peak with a fish course, followed by a staple (rice,
dumplings, noodles) and wind down with a sweet or dessert.

Refusing food: The Chinese tend to offer a lot of food, and it is

acceptable to refuse food if you have dietary restrictions or allergies.
However, it is a sign of politeness to accept some of everything, and

sample (even a little of) all dishes served. But dont eat or drink all of
something you dont like, since this may be taken as a sign that you
want more! This is where the rotation of plates can serve to your
advantage: a nod to the wait staff to remove a plate will allow for your
preferences to be accommodated unobtrusively.

Drinking: While local wine can be preferred at banquets, the Chinese

more frequently offer strong distilled alcohol called baijiu or maotai (a
very special type of baijiu) for toasts and there may be many toasts
during a meal. Never drink from the toasting glass except during a toast
and dont let the size of the glass fool you as to the power of the
contents! The Chinese know that their alcohol is considered strong for
foreigners, and under normal circumstances, they will not push you to
drink. Some hosts will provide drinking yogurt to help protect your
stomach, which can be helpful to allay the effects of the alcohol. Try to
avoid drinking baijiu on an empty stomach as you will feel the effects of
the alcohol quickly its a good idea to eat something before the toasts
begin. If you cannot or do not drink for medical or personal reasons, this
is respected but you should advise your host or your working level
contact of this at the beginning of the banquet, or even beforehand. It
will be noted carefully by your hosts and arrangements will be made to
avoid embarrassing you.

Toasting: Your host will start off the banquet with a toast to your
presence / friendship/ cooperation / getting to know each other /
clinching a deal. You may choose to reciprocate, toast for toast, or to
wait until the host, his or her colleague, and one other member of the
hosting party has toasted. Typically, the principal guest is expected to
toast a few courses after the host toasts. If you are toasting, your
comments should be warm and sincere, and your toast should not be any
longer than your hosts. When toasting, the Chinese normally say gan
bei, which translates to bottoms up. Note that drinking is sometimes
expected as proof of a close relationship where partners can reveal their
true selves, even in a business context. While this expectation is slowly
changing and may vary by region, it is something to be aware of. If the
group at the banquet is very comfortable with each other, it is also not
uncommon to go around the table toasting each member of the party.
Take your cue from your hosts and from your local contact or interpreter.
o

Note: There are great differences in dining and toasting

customs among different regions in China. When in doubt, ask
your host. He or she will be very happy to explain them to you
and will be impressed at your interest in and respect for local
customs.

Conversation: The banquet is generally a social event in a formal

context. Discussion will likely centre around pleasantries, background
information on the region or the company, but it is not a time for

negotiating or challenges. The focus may not be the food per se, but
there will be pride in the offerings provided.

Paying the bill: The host pays. If you are hosting a meal, do not show
money in front of your guests. Either have someone slip out and settle
the tab or wait until your guests have left before paying.

Hosting the banquet: It is not common business practice to be

expected to host a banquet at the conclusion of a deal. Certainly if you
would like to host a banquet this is your prerogative, but it would be
considered bad form in a business context for the Chinese company to
insist you do so or provide you with the bill at the end of the meal.

Concluding: There is little lingering at banquets. Formal dinners often

end suddenly, when the senior member of the hosting party stands up
(quickly followed by staff and subordinates), briefly thanks the guests for
attending, and proceeds to leave the room. This may appear abrupt the
first few times you witness it, but is simply a decisive and useful way to
bring the occasion to a close. If there is a dessert / fruit course, you can
expect this to follow fairly shortly before the senior member of the
hosting party departs. Gifts (see below) are usually offered at the
conclusion of the banquet, prior to departure.

Gift Giving
Top tip: Buy Canadian and make no allusion to the passing of time!
Gift giving is a common Chinese custom that business visitors to China should
prepare for and use to advantage. The advice of a Chinese friend or colleague
is invaluable in doing this properly, but here are some simple guidelines:

Who: Typically, a single large group gift is presented to the chief person
or leader of a Chinese organization. Gifts should be presented from the
lead of the Canadian delegation to the lead of the Chinese delegation and
vice versa.

What: Gifts should not be too expensive. The gifts you receive will often
have strong local associations that are a matter of real meaning (local
identity) and therefore pride to the giver. The best gifts to offer in return
will be items that are unique to Canada: small paintings, carvings, or
books (keep your hosts English capabilities in mind!) are appreciated
and reasonable as gifts. The Chinese are fond of dark red, gold or blue,
which are all appropriate colours for gift wrapping.

When: Gifts are usually given at the end of an introductory meeting or

at a banquet. Delegations visiting China are normally expected to offer
gifts to their hosts, and the opposite is true for Chinese travellers to
Canada. In both cases, this should be factored into preparations for
making a trip or receiving an incoming delegation in Canada.

How: Always give and receive gifts or anything of value with two hands.
Note that it is common in China for the recipient to refuse the offer of a
gift at first. The giver should persist, and the recipient will eventually
accept.

What Not to Give: Gifts to avoid include clocks and scissors or other
sharp items such as knives or letter openers. Avoid wrapping gifts in
white or black, which are colours associated with funerals.

Elements of Chinese Business Etiquette

A common mistake business people make before going overseas is
not making an effort to understand the basics, such as how to make
a positive first impression. These first impressions are based on
etiquette and greeting rituals that vary for different countries. The
business etiquette associated with the wai in Thailand, the bow in
Korea and Japan, and the handshake in the West when done
properly create a good first impression. When done wrong, one
potentially botches the relationship in the first 30 to 60 seconds.
Unfortunately, creating a positive first impression is not enough.
One should also have an understanding of the following aspects of
Chinese business etiquette:

Gift
giving

Greeting
rituals

Business
relationship
development

When
to
display
emotions

Time
perceptions
Differences in decision making and problem solving

Guest-Host
relations

Negotiation
styles

How
to
use
intermediaries

Meeting
customs
and
conduct
Use of the names, titles and business card presentation
How to establish relationships with government officials
Finally, according to Mark Buchman, who teaches a class called
Doing Business in the Pacific Basin at UCLA, there are five
principles (The 5 Ps) that one must keep in mind to successfully deal
with different business etiquette in general. They are:
1. Plan. It doesnt have to be the 60-page bulletproof version one
would present to the venture capitalists, but there has to be
something written that all agree on. Its critical to define the
fundamental opportunity, your competitive and marketing strategy,
and its tactical components.
2. Persevere. Its not easy to do business there, so dont give up.
Many sound business concepts fail when the company loses heart
too early in the process.

3. Patience. If you are a financially driven company that sets high

hurdle rates with short-term payback periods, you will give up too
early and lose the investment or not have the guts to try.
4. Personal Relationships. Something generally considered *not too
important for most task oriented managers is extremely important
in Asia.
5. Perfection. We are bound to make many mistakes. Learn from
them and dont make them a second time.
To those five, I would add a six principle, Prevention. As Ben
Franklin once said, An ounce of prevention is worth a pound of
cure.

Understanding Eastern and Western Thinking Patterns

Its important to realize that one of the more subtle aspects of

culture and business etiquette has to do the way one thinks about
how the world. The following table presents some of the differences
between how the Chinese and the Western individuals think about
culture and values.

West
(America & most
European countries)

East
(The Chinese and Most
Asian cultures)

Type of Logic

Linear (More causal

relationships and
direct associations
between A and B)

Spiral (more roundabout

and subtle)

Expression of
Agreement and
Disagreement

More argumentative,
willing to express
disagreement verbally

More difficult to say no

even if one means no,
disagreement expressed
nonverbally

Communication of
Information

More meaning is in
the explicit, verbal
message.
Use of direct language

Meaning is often implied

or must be inferred
Use of indirect language
patterns

Expression of
Honesty

More overt, one is

more likely to ask the
person to speak their
mind or get it out on
the table

Subtle, nonverbal

Expression of Self

I-oriented
Sender-oriented

We-oriented
Receiver-sensitive

Cultural Values
Expressed

Thinking Orientation

More rule based or

based on application

Tends to take context

and the specific situation

of abstract principles
such as regulations or
laws

into account in rule

interpretation

The Individual

Has to have rights and

greater need for
autonomy and
individual
achievement

Group duty
preservation of harmony

Nature of the
Business
Relationship

Less important,
tend to substitute
relationship for
written agreement,
superficial, easy to
form, not long
lasting

Most important
business cannot
occur until
relationship if sound,
written agreement
secondary to quan xi,
hard to form, long
lasting

Conflict Resolution

Trial or confrontation,
use of lawyers and
courts

More mediation though

trusted third parties

Time Sense During

Meetings

Be on time and end

on time.

Appointments less
driven by exact start
and end times

Conflict results

Perception of two
states: win or lose

Win-Win
To lose is to win
Lose in order to win