The Rule of Culture

Corporate and State Governance in China and East Asia

Hong Hai

• Publisher: Routledge
• Year: 2019
• ISBN:
  9780429655210
• Edition: 1
• Topic: Business
• Subtopic: Business General
• Index: Business

Culture has an abiding influence on the way countries and business corporations are governed. This book introduces the reader to the deep philosophies that drive corporations and governments in East Asia, from China through Japan and South Korea to Singapore. With sparkling clarity and spiced with anecdotes and case studies, it depicts how respect for cultures can lead to spectacular success, or the lack of it to failure. Confucian practices such as guanxi in Chinese society, the benevolent culture of entity firms in Japan, and patriarchal chaebols in South Korea are analyzed with examples like Esquel, Nissan, and Samsung. A delightful chapter on Daoism shows how it drives Jack Ma's Alibaba.com.

In the governance of nations, the author reinforces Burke's dictum that systems of government must be consonant with traditional cultures, and he calls out misguided attempts by the West to foist liberal democracies on civilizations in the East where respect for authority and communitarian values come before individual interest. The author advances the novel concept of the meritocratic democracy in which leaders are chosen not by electoral popularity but by proven ability. In a thought-provoking concluding chapter, he evaluates prospective constitutional changes in China that would enshrine meritocratic democracy as an alternative to liberal democracies that have turned dysfunctional in many Western nations.

1
FROM HUANGDI TO XI JINPING

A brief cultural history of China

When Voltaire declared that the organization of the Chinese empire was “in truth the best that the world has ever seen,” the merits of Chinese governance were little known in the West. Even in the early twentieth century, German intellectuals were only starting to appreciate the sophistication of Chinese civilization; the philosopher Hermann von Keyserling considered China “the highest universal culture of being hitherto known.”¹

Although the Summer Palace was admired by some European intellectuals, rampaging British and French troops had little idea of the sacrilege they were committing when they burned it down in 1890. They destroyed most of the priceless art treasures from three millennia, and stole much of the rest to sell for puny gains. As a senseless act, it was worse than the destruction of ancient Roman ruins in Palmyra by the Islamic State militants in 2017, which drew international condemnation.²

China had been one of the richest and most enduring cultures in human history for three millennia. The hundred years of humiliation she endured from the start of the Opium Wars in 1839–1860 was a bitter pill to swallow. Throughout those dark days of Western imperialist oppression, the Chinese never lost confidence in the superiority of their culture. They continued to refer to Western invaders as “barbarians.” In so doing, they placed these Westerners invaders in the same category as Mongol horsemen from the north who had conquered China only to be overthrown by mandarins armed with centuries-old wisdom.

In this chapter, we will take the reader through a selective review of highlights of Chinese cultural history, so as to provide the necessary background for assessing how culture continues to influence governance and management in contemporary China and East Asia.

China in antiquity

Chinese history is usually thought to have begun five thousand years ago with the legendary “Three Sovereigns and Five Emperors” (sanhuang wudi 三皇五帝). Of these, emperors Yao and Shun have been revered as wise and benevolent rulers. The emperor Huangdi or the “Yellow Emperor”³ is credited with developing medical practices to improve health, longevity, and harmony with nature. These practices were compiled two millennia later in the classic The Yellow Emperor’s Canon of Medicine (Huangdi Neijing 黄帝内经).

The first dynasty, the Xia (夏) (circa 2100–1600 BC), is regarded as largely mythological, as there are few reliable written records of the period. However, archaeological findings show the existence of an agrarian civilization centred in northern China around present-day Shanxi, Shaanxi, and Henan provinces.

The Xia was followed by the Shang Dynasty (商) (circa 1600–1122 BC). Under the Shang, complex urban settlements and social stratification emerged. Bronze castings and oracle inscriptions on tortoise shells (sometimes called oracle bone inscriptions in English) represent some of the earliest Chinese art and literary forms. Because words were laboriously carved on tortoise shells (jia gu wen), economy of expression was needed. Hence, written texts were terse and concise. Extensive use was made of anecdotes and narratives to convey complex ideas in a few words. This is not unlike the Western idiomatic use of shorthand devices such as “Trojan horse,” meaning a ruse used to gain entry into enemy ground. Because of the difficulty in producing such concise language, only those who had studied history and the classics could read and write with confidence. Literacy became the preserve of an elite few, which ensured a high degree of social stratification up until the May Fourth Movement of 1919 when plain language (baihua) was adopted. This simplification put reading and writing within reach of the masses.

The resultant explosion in literacy had far-reaching social implications. It allowed the common people to read political literature and posters, and gave them access to the wisdom of the ancients through classics written in spoken language. In the late twentieth century, mass literacy played a crucial role in the country’s economic development.

Zhou dynasty

The Zhou dynasty (周) (1122–221 BC), which lasted for over nine hundred years, was a period of significant cultural progress. It saw the rise of philosophical thought, the emergence of a state bureaucracy, and the study of military strategies as the art of war.

The “Hundred Schools of Thought” phenomenon that flourished from the sixth century BC to 221 BC was an era during which there was vigorous contention among scholars.⁴ Owing to the immense cultural and intellectual energy of this period, an unusually broad range of ideas was freely debated, some of which would influence societies in East Asia. The most influential of these schools of thought were Confucianism, Daoism, Legalism, and Mohism. Of these, Confucianism and Daoism would eventually expand and gain dominance in Chinese society up to modern times.

The Legalists saw human nature as inherently selfish. They advocated that the only means of preserving social order was strict discipline and the enforcement of law, with severe punishments for the recalcitrant. It exalted the state as coming before all else, and maintained social order by empowering the state through wealth and military strength. Legalist philosophy retains some influence among a number of present-day East Asian authoritarian regimes.

Proponents of Mohism, named after founding father Mozi (470–391 BC), saw everyone as equal under heaven and preached universal love. The Mohists disapproved of partiality towards one’s own family members, and wanted officials to be appointed on the basis of ability and compassion for common folk. It was a gentle philosophy that did not survive the tyrannical Qin emperor who ended the Zhou dynasty.

It was the pragmatic social ethics of Confucian thought and the wisdom of Daoist harmony with nature that survived despotic rulers and dynastic upheavals. The teachings of Confucius (Figure 1.1) and his disciple Mencius, and the thoughts of Daoism founder Laozi (Figure 1.2) and disciple Zhuangzi, have remained the staple of students of Chinese philosophy. They continue to be enduring influences over the spiritual consciousness of Chinese civilization and underlie its resilience.

FIGURE 1.1 Confucius, the teacher and moral philosopher⁵

FIGURE 1.2 Laozi, gentle founder of Daoism⁶

Sunzi and the Art of War and the brilliant strategies of the later Zhou period (known as the Warring States) were distillations of the musings of fertile minds that considered all political and military situations to determine where strategic genius could be applied to gain victory. A thousand years later, these strategies were edited and rewritten as the classic manual on intrigue, The Thirty-Six Strategies (sometimes translated into English as The Thirty-Six Stratagems).

United under one emperor

The chaos of the Warring States period ended when the first emperor defeated rival states and unified them under the Qin dynasty. It was a creative if short and violent dynasty. The Qin emperor established standards of measure and currency for exchange, and started building the Great Wall to keep out northern barbarians.

Attempts to attain immortality finally resulted in his death, when he was poisoned by one of the elixirs of life he imbibed. The dynasty collapsed during the reign of an incompetent son who was weighed down by a creaky, hapless administrative structure unfit for a vast nation. Qinshi Huangdi, the first emperor of a united China, left behind an immense mausoleum with thousands of terracotta soldiers guarding his final resting place.

A principal reason for the quick fall of Qin was the first emperor’s rejection of Confucian thought. Confucian scholars had exhorted him to show benevolence to his subjects and observe the rules of propriety laid down by the great sage. In response to their earnest representations in court, Qinshi Huangdi buried them alive and burned all the Confucian texts he could find.

Without the scholars and their administrative skills, the dynasty crumbled, making way for one of the greatest Chinese dynasties.

From Han to Ming

The Han dynasty (汉) (202 BC–AD 220) saw the development of a formal structure of civil service, a central government, and provincial governments. Education in the ancient classics flourished. The invention of paper allowed careful records to be made of administrative decisions and enabled the propagation of government experience to the far reaches of the empire. Advances in farming during this period ensured that even though droughts and pestilence continued to plague Chinese life, starvation was reduced to periods of bad harvests.

The medical classic Huangdi Neijing, compiled during this period, rejected the ancient mythology of spirits and demons as causes of disease. Drawing on Daoist holistic philosophy, illness was attributed to natural climatic forces, human emotions, and poor lifestyles. Healing methods were developed according to the physicians’ clinical experience. The Neijing is the authoritative text on the tenets of Chinese medicine even today. Its emphasis on diet and living habits for the prevention of disease continues to be the basis of Chinese health cultivation. Its insight into internal imbalances of the body as the basic cause of illness stands in contrast to the importance of aetiology in Western medicine, which emphasizes microorganisms and cellular malfunction.

The concept of balance and harmony within the body, where yin and yang check and balance each other, ...