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The nuances of cross-cultural dealings

October 29, 2012
The Lawyers Weekly
Richard Skinulis

Doing business in another country is fraught with danger — even something as simple as the colour of a hat.

Take, for example, the Canadians who knew a business trip to China had gone wrong, but weren’t sure why. For one thing, they had brought knitted hats in a nice shade of environmental green as gifts for their Chinese counterparts. But the recipients looked very uncomfortable and seemed reluctant to put them on. They had committed some kind of cultural faux pas — but what was it?

“Wearing a green hat in China means your spouse is cheating on you,” explained Kathy Keyi Jia-Jones, founder and owner of Cross-Cultural Biz, a Richmond Hill, Ont.-based consulting and training company.

After the firm hired her, she found more colour-related fiascos, she says. “They had their business cards redone in Chinese with their names in red because, hey, the Chinese like the color red, right? Translating the cards was
a good idea but, in China, the color red is reserved for the names of those who have been condemned to death.”

Overcoming cultural and language barriers is becoming increasingly important as more Canadian companies invest in emerging markets. According to a 2012 global survey of 572 executives (Competing Across Borders: How Cultural and Communication Barriers Affect Business — the Economist Intelligence Unit), almost 90 per cent thought their company’s overseas client base will increase over the next three years, while 43 per cent said communication problems have stood in the way of a major cross-border transaction. Firms in Brazil (74 per cent) and China (61 per cent) reported the most financial losses from these misunderstandings.

One of the biggest stumbling blocks is negotiations.

“A lot of Canadian firms are not familiar with Chinese communication style,” says Zhenyi Li, associate professor at Victoria’s Royal Roads University, which offers a master’s degree in intercultural communication.

One such issue is how to interpret the yes or no answer for the simple question: “Do we have a deal?”

“In China, it’s considered impolite to reject a suggestion or opinion,” Li explains, “so when Chinese people say ‘yes’, it means ‘maybe’, and when they say ‘maybe’ it means ‘no.’ When they say: ‘Let me think about that,’ Canadians complain ‘they never got back to us’ and I have to tell them, ‘that’s because they really said no.’”

Just to make it harder, no can also mean yes, Li says. “If you ask them if they want another cup of coffee, or offer to do them a favour, they say no but they’re just being polite — it really means yes.”

Li says it’s important to know how “international” are the Chinese you are dealing with. If they have spent time in the West and done business with western firms, they’ll use direct answers. “But if they are typical Chinese Communist Party members without too much experience with western business people,” he says, “they’ll probably use the traditional, indirect form of communication.”

In some cultures, physical signs and cues are more important than what is said. “One of our clients had a customer in India who wouldn’t look him in the eye,” Jia-Jones recalls. “We explained that in ‘high contact’ cultures — like India, China and Mexico — it’s considered rude to make prolonged eye contact, whereas Canadian lawyers are taught that it makes a solid connection.”

Not surprisingly, Li says a lot of Royal Roads graduates are hired by law firms, often to tackle mining and environmental issues in emerging markets. Li, who has a PhD in Intercultural Communication from the University of Jyvaskyla in Finland, was himself engaged recently by two Vancouver law firms (Bull, Housser & Tupper, and Fasken Martineau) to submit affidavits in trademark registration disputes (one settled out of court, the other faces litigation). One was a company registered in Hong Kong that was now expanding into Canada and had similar trademark and business names as a Canadian company.

“That was very tricky,” Li says,” [because] they needed a precise description of exactly what those Chinese trademarks mean in a Chinese cultural context.”

Deals in China are made over the won tons. That means details count, starting with the seating plan.

“In Canada, you often just take a seat at the table,” Jia-Jones says. “But China is more formal. You have specific places for the heads of the delegation and then for others. After the first formal banquet [in Canada], you can loosen up and let them seat themselves western style because you have already shown them respect.”

As for table etiquette, you can put your elbows on the table and slurp your soup to show you enjoy it, but never, ever stick your chopsticks upright in the rice bowl, which is disrespectful. “Over here pretty much anyone can pour the tea,” she adds, “but in China, the host serves the tea. When it’s half full you must fill it up.”

To cement the relationship, Jia-Jones recommends gifts such as Inuit paintings and soapstone carvings, as well as other Canadian things like stamps, coins, maple syrup — and definitely ice wine.