A Basic Analysis of Confucianism and Its Impact on Traditional Chinese Business

Confucian ethics, the most quintessential and fundamental thought system governing Chinese culture for thousands of years, posed great impact on the economy, politics and culture of China. Without doubt, Confucianism has formed a strong bond with traditional Chinese business culture since a long time ago.

The idea of profits in Confucianism is a double-edge sword. On the one hand, the disciplines of Confucius have clearly stated that it was immoral for those of senior positions to indulge on profits for their own. On the other hand, the risk-taking commercial activities of the merchants should meet people’s various needs.

In a nutshell, Confucian ethics were fully incorporated into traditional Chinese business activities. According to Confucianism, merchants’ business activities should be subjected to ethical principles with righteousness rather than profits as their core principles. Collective benefits should outweigh individual benefits, and the same also applies to spiritual values against materials values.

The ethical principles have set up a series of practical guidelines and rules for business men to adhere to. Ren, the core value of Confucianism, which includes benevolence, humanity, kindness and goodness, play a significant role when it comes to pursuing profits and balancing ethics. The ethics of Confucianism aim to weed out some evil practices in carrying out business activities such as cheating, manipulating supply and demand so as to increase rates, corruptions of civil servants, etc.

According to Confucianism, another term, Li, a set of ethical principles governing people to behave politely and ethically, also posed deep impact on traditional business activities. Mutual respect, politeness, quality service and good interpersonal relationship in a hierarchical society are also considered as priorities in doing business, outweighing the pursuit of profits.

Xin, another Confucianism virtue meaning faithfulness, trustworthiness and honesty, is also a vital principle guiding business activities. Only when honesty and trustworthiness are thoroughly practiced could harmony and mutual benefits be achieved in the business activities.

Yi, which means righteousness, the responsibilities of doing good for the human being. In traditional Chinese business activities, Yi guides the flow of business as people should have the ability to know what is the right thing to in spite of losing great profits.

The above virtues of Confucianism have guided traditional Chinese business for a long time in a right way. Even today, its influence on modern business activities is profound. Gaining some knowledge of Confucianism and its impact on traditional Chinese business practice can help you set foot in the door when it comes to doing business in China.

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