Impact of Confucianism on Taiwan Business Ethics

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Taiwan is one of the most diverse countries in terms of culture that encompasses a Japanese, Chinese, Austronesian and Western blend (“Taiwan business: the portable encyclopedia for doing business with Taiwan”, 1995). Taipei the capital city of Taiwan is open to visitors and many business opportunities because many people are attracted to its rich multi-cultural diversity. In Taipei, the family unit is considered to be the center of all cultural activities just like in most Asian cultures. The society here is class-oriented or rather hierarchical dictated by the traditional social ladder from soldiers at the bottom, merchants, workers, peasants all the way to scholars at the top.

To efficiently open and run a subsidiary in Taipei, the most important cultural consideration is language. For any business to thrive there has to be a connection between it and its customers through communication. Mandarin is Taiwan’s official language just like it is in mainland China; commonly known as ‘Guoyu’ (Lau, 1994). Employing staff well versed to the language is key in setting up a subsidiary in Taipei to ensure that customer needs are met effectively and efficiently. Without language barriers at the work place, colleagues also tend to work harmoniously and team work becomes a norm.

As earlier stated, Taiwan is deep rooted in a hierarchical culture. For business to flourish in Taipei, one therefore has to consider the concept of Confucianism that entails relationship networking and embracing the values of modesty, loyalty, solidarity and courtesy. Despite the hierarchical system being lenient in Taipei than in South Korea and Japan, age and seniority play an integral role in addition of rank within work places. Therefore, for the subsidiary to be accepted into the business community and society at large, these considerations have to fall in place including ensuring inclusivity of staff in making decisions.

In Taipei, the locals value long-term business relationships and they therefore observe to see if their foreign counterparts could become part of their ‘guanxi’ (inner circle) (Lau, 1994). Therefore while opening a subsidiary, it is important to ensure deals are closed in a professional manner. The ‘guanxi’ is crucial in starting a business in Taipei in order to develop business opportunities, get help when in trouble and to access important information. To cement these relations, I would ensure that hierarchies are observed when sealing deals concerning the business subsidiary.

Another remarkable and interesting culture for the Taiwanese, is gift giving. For a business subsidiary to succeed in Taipei, one has to incorporate a gift policy within their business model (Lau, 1994). Gifts of value are a norm in many East Asian cultures. Gifts are especially given in first meetings and it is customary to reciprocate with gifts of equal value. Wrapping the gift is as important as the gift itself and in Taipei, denying a gift speaks volume. It is very important for foreign business contacts to insist that the gift is received to continue a cordial relationship.

Conclusively, it is worthwhile to appreciate that Taipei has seen many foreign traders and multinationals; meaning that the Taiwanese have gradually been accustomed to interacting with business expats in the world. Setting up a new subsidiary in Taipei would require having a cross-cultural human resource and embracing Confucian values at the work place in order to succeed. Therefore, it is important to understand the Taiwanese cultural diversity to stand out and have a competitive advantage above other foreign and local business competitors.


  • Lau, L. (1994). The Competitive Advantage of Taiwan. Asia Pacific Business Review, 1(1), 90-112. doi: 10.1080/13602389400000006
  • Taiwan business: the portable encyclopedia for doing business with Taiwan. (1995). Choice Reviews Online, 32(06), 32-3057e-32-3057e. doi: 10.5860/choice.32-3057e

Cite this paper

Impact of Confucianism on Taiwan Business Ethics. (2020, Sep 16). Retrieved from https://samploon.com/impact-of-confucianism-on-taiwan-business-ethics/

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