Despite the current economic pressure, many Chinese enterprises are seeking growth opportunities and spending efforts on expanding their influence overseas. However, there has been an alarming trend in the perception of Chinese enterprises among locals.
According to the report “Chinese Enterprises in International Perspective” released on May 18 by Brunswick, a Corporate strategic communications consulting firm, emerging market countries, especially those along the route of B&R (the Belt and Road Initiative)，have welcomed China’s investment and cooperation.
Compared to the previous year, the degree of trust among those emerging market countries of Chinese enterprises increased from 77% to 80%. However, the degree of trust among developed countries has been declined from 56% to 51% year-on-year.
In autumn 2019，9,700 public figures from 23 countries which Chinese enterprises chosen for investments, and 300 Chinese corporate executives who have or are plan to invest in international markets have been surveyed.
According to the report there are three reasons why there are some cognitive differences among the interviewees from developed countries and emerging markets:
Firstly, 82% of the respondents who has a better understanding of Chinese enterprises also has positive attitude towards Chinese enterprises. In contrast, 45% of respondents who needs more understandings of Chinese enterprises has a negative attitude. The more a respondent knows about Chinese enterprises, the more positive his attitude towards Chinese enterprises would be.
Secondly, most emerging markets view Chinese enterprises as independent business forms, rather than implementers of government policies.
Local respondents have a higher degree of trust for all types of enterprises in China, no matter they are listed, private or state-owned. But developed countries have different opinions. They believe that most of Chinese companies are cooperating closely with the Chinese government. They don’t trust Chinese enterprises and business because they think they are too politically relevant.
Thirdly, the expectations of Chinese enterprises overseas would influent the attitudes of others. Respondents in emerging market countries strongly believing that Chinese companies will have a positive impact on the economies of these countries over the next decade. Related business investments would make local markets more valuable Respondents from developed countries shared lower average score. The number of people who think Chinese companies would bring a positive and negative impact is split 50/50
Mei Yan, a senior partner and China chairman of Brunswick, said developed countries such as the United States will pay more attention to the scrutiny of China’s overseas listings, investments and mergers and acquisitions. However, many Chinese business leaders should pay more attentions to that. Only 12 percent has a better understanding of it, while 80 percent either knew little or nothing about it.”
“This situation is very dangerous, and it would make our overseas expansion plans hit the rock bottom and fail.” said Mei Yan. “The situation is dire, but that doesn’t mean that Chinese enterprises should abandon or delay their overseas expansion plans. It should remind us of having enough preparations.”
In addition, the report shows that Chinese business leaders believe that the United States is still the best option of expanding their business overseas.
But in fact, Americans’ perception of Chinese companies has become more negative, with the degree of trust in Chinese companies dropping to 51 percent from 57 percent in 2018.
Respondents worldwide believe that Chinese companies need to improve their managements in the fields of environmental, social and governance (ESG), especially in the treatment of local employees and activities of environmental protection.