This paper seeks to examine the impact of the gūanxi phenomenon (which is carefully defined) on the management of corporate reputation in China, with particular reference to large‐scale social and economic change there since the turn of the century, and to the role of government in the business sector in modern China.
Conclusions and interpretations are based on an extensive review of published research studies and authoritative commentaries. Selective use is made of case examples featuring familiar multinational companies, to illustrate the key issues.
China remains a hierarchical, gūanxi‐based society despite its rapid transition to a market‐led economy. Today's decentralised business environment is in fact more complicated in various ways than that in the pre‐reform era. Since reputation is relationship‐based, gūanxi networks are an important element of “reputation capital”. The most important stakeholder is still the government, specifically the ruling Communist Party. Multinational marketers need to adopt a strategy that takes due account of national and local culture.
Although the gūanxi phenomenon has been studied extensively, its role in reputation building and promotion has yet to be fully understood.
This paper establishes the link between the two concepts, and provides a departure point for further study of the core concepts or the development of new toolkits for marketing planners.
The findings have added substantially to understanding of interplay between gūanxi and the management of corporate reputation, in China but also by extension elsewhere.
