In the risky, uncertain and highly competitive environment of the Chinese market, and when faced with the traditional Chinese tendency to mistrust anything unknown, your ability to inspire your future partner’s trust will be a decisive factor for the positive development of your business.

To approach China with a good chance of success, you must start from the following premise: as a general rule, Chinese people do not trust anyone… except people they know.

There are a few good reasons for this:
• Buried deep in the Chinese mindset, an atavistic caution and a reluctance to take risks.
• An eventful collective history that has led a great many Chinese people, over the generations, to rely only on their relatives.
• The traditional “clan” structure of society, which establishes strong links between members of the group while maintaining a suspicious, even hostile, attitude towards everyone outside the clan, whether they are Chinese or not, and with a particular mistrust of foreigners.
• An unreliable legal system in which the law provides little protection, compared to the way things are run in a country like France.

In this traditionally collective/collectivist society, Chinese people prefer to begin future-facing business ventures with people who are known to them, either through being part of the family, close friends or in the clan (guanxi), or because they have been recommended by trustworthy people.
Unlike in the West, where commercial contracts and the “rule of law” legal framework are in place to protect us against possible risks, in China, private law and commercial law are relatively new and not yet very mature, and Chinese people tend to be wary of the courts.

Therefore, the relationship forged between individuals will be the only valid guarantee that everything will go well in the future.

Another additional factor of mistrust is the lack of data transparency and reliability. In the West, we have a proven system of information on companies and we can easily access many documents. In China, on the other hand, information is scarce, questionable, often truncated, and one can place very little trust in figures presented. Therefore, in the absence of a reliable documentary base, evaluation of the individual provides a way to gage how trustworthy they are.
While Westerners are more inclined to rely primarily on the company concerned, for Chinese people it is the relationship established with a particular person that will spur them to work with that organization. In other words, trust in China is interpersonal rather than institutional.

Trust and Confucianism
In the Sayings or Analects of Confucius, Xin or XinYong appears as one of the five cardinal virtues.
• The term Xin is often translated as “trust”.
• It also encompasses the idea of “reliability, credibility”. The ideogram Xin 信 is composed of the root 人 “man” + 言 “word”, in other words “man faithful to his word”. • However, Xin has another dimension as well as the simple notion of trust as we perceive it in the West.
Most Westerners are predisposed to trust other people immediately; in other words, we spontaneously trust a stranger until they prove untrustworthy.
This trust is “legalistic”. It has a contractual basis and is guaranteed by the institutional and legal framework.
Conversely, among Chinese people the predisposition is to mistrust.
Trust is reserved for group members, in a context where everyone knows each other.
Chinese people rely on family members, “guanxi“, and long-time friends.
This trust is “moralistic” (based on the individual’s moral values and the interpersonal relationship).
This is why it is so important to build a relationship, in order to establish trust and dispel mistrust.

To learn more about “How to build trust with Chinese people”, sign up for our workshop “How to work with China”,  by our China expert, or contact us!

Article written by our China expert, Maurice Herschtal.