At Google, they are not feeling particularly lucky?with China. And, for some good reasons. Google launched its Chinese site, Google.cn, in 2006, riding on a wave of optimism about the Web?s power to spread information within closed or partly unfree societies. At that time, it left a lot of people uncomfortable with the decision to censor its search results to comply with the Chinese law. As was widely anticipated, high-minded expectations quickly began to sour. By March this year, the Internet behemoth had grown so uneasy with hackings, censorship and the overall business climate in China that it finally pulled its search servers out of mainland China. Using a loophole in the Chinese law, it now automatically redirects mainland users to its Hong Kong site, where ?sensitive? information will not be blocked by the filters that grind so ominously in the mainland. Even that strategy is in trouble, of late.
Perhaps, what was so surprising about Google?s decision in March was that it has been so long in coming. For a decade, Beijing has been making steadily stricter demands on producers of information security products such as encryption software, smart cards and secure routers. Compulsory certification and domestic technology standard requirements are too rigorous and non-discriminatory to force suppliers share their technology with the government. Foreign website companies that wanted a pie in the China?s Internet business had, in effect, little choice but to fall in line.
At one level, the China-Google tangle was a case that revealed the many strains within the one-party ruled, authoritarian state. The row can be understood in a simple way. If you typed ?Tiananmen Square massacre? into a Google search engine in mainland China, you were bound to receive this response: ?search unavailable?. But if you make the same search in Hong Kong, for instance, where freedom of speech is far less circumscribed, you will quickly be directed to sites describing the massacre of unarmed freedom protestors, mainly students, in 1989. The Chinese regime obviously wants to choke off its people?s inquisitive spirit. In the end, Google decided to duck the increasing censorship demands by rerouting traffic through its Hong Kong server to protect its credibility.
When its comes to practising cut-throat marketplace capitalism, China is not far behind the United States in any meaningful manner. Except that when Deng Xiaoping labelled it as ?socialism with Chinese characteristics?, he had made a very valid point. China remains exactly the land of capitalism with tight-fisted state controls.
Ask Google. At another, more fundamental level, the debate over restricted freedoms in China the issue sparked is a case study worthy of being taken up at B-schools, as it raises serious questions about how corporations from the free world deal with different cultures. But then, isn?t teaching morality a loopy idea? No longer. There used to be a time when it was a laughable proposition to raise ethical issues in a class of management theory and practice, but that?s not the case any more. Some reputed B-schools in the US have developed new courses that address the controversies that arise when businesspeople deal with ethically ambiguous situations, such as Google?s tackling of the Great Firewall of China. For, Google set shop in China with the full knowledge that it would run, sooner or later, against the controls the Chinese state demands and imposes on search engines. Yet, after four years of cutting corners on its own policy of ?don?t be evil?, it had to give up the game. And, in these years, the company could not make a major dent on the near-monopoly Baidu Inc enjoys in the Chinese search market.
In fact, Google faces a critical dilemma in China. All along, the Chinese government never wavered from its policy. But quitting China altogether means that Google will lose out badly on what is the world’s largest Web market by users. It makes no commercial sense. Also, if it allows itself to be thrown out of China, Google cannot claim to be in the business of ?organising the world?s information?. It makes no philosophical sense, either. It?s an evolving duel?how a super-smart company that stands for certain principles deals with a super-smart state that brooks no dissent.
From a B-school perspective, what guidance can be taught on dealing with such scenarios which are ethically unedifying? C Raj Kumar, vice chancellor of OP Jindal Global University, believes that there are many. In his opinion, management school students should be made aware of the risks that state-controlled economies where freedom of enterprise is non-existent pose to conducting transparent business.
?The values and principles of corporations and business entities are central to the creation of sustainable and ethically sound businesses. There is a greater need for B-schools around the world to play a more important role in addressing issues relating to ethics in business as well as ensuring corporate accountability,? Raj Kumar adds.
Jitin Chadha, director of the Indian School of Business & Finance, concurs. ?As more Indian companies go multinational, the case of a state-controlled economy in a general environment of free market system needs close attention by business schools even in India,? he notes.
The importance of teaching ethics was apparent during the economic crisis of 2007-09, as the fretting about Wall Street bankers turned into full-scale loathing in popular imagination in the US. The impression got strengthened that many business schools were taking bright, ambitious students, teaching them sophisticated techniques and, in a Western analyst?s words, ?turning them loose, armed and dangerous?. Just consider the way Wall Street banking wizards invented reckless ways of derivate trade, bridge equity and securitisation.
?A corporation has to often walk a thin line between value system and growth. This balancing act depends on the leaders of the corporation to define their area of concern. Some face ethical dilemmas, others don?t. It is a free world, and we can?t make safe surmises. The only option we have is to choose, but the crucial mental faculty that prompts us to do the choosing needs training,? according to Gaurav Mittal, CEO of DMC International, an education services company.
It?s a reality that businesses that believe in freedom and transparency have to operate in places the very survival of whose regimes depends on propaganda and mass mind control.
At Googleplex in California, they may be feeling neither lucky nor happy with China. But how deftly the company upholds its ?don?t be evil? philosophy there will be a fascinating story of historic significance.
??rajiv.jayaram@expressindia.com