If You Do Business in China, You Are Going to Be Spied On by Chinese Intelligence

Nina Xiang

July 9, 2014

Corporate Espionage Impacts Doing Business In China

A sex tape is always intriguing.

In this case, my curiosity was aroused by a secretly-filmed alleged sex tape of the former China head of British drug-maker GlaxoSmithKline (GSK) and his girlfriend, which was sent to senior executives at GSK as a teaser for whistler-blower documents.

So I talked with Steven Feldman, professor of business ethics at Case Western Reserve University in Cleveland, Ohio, about it.

He shared with me some anecdotes about hidden surveillance while doing business in China. For example, he say he knows one major American company that had an office in Shanghai. The board of directors of the company wanted to come over to Shanghai to have a board meeting. But the company’s China head was unable to get the electronic bugs out from his boardroom, because it’s illegal to own the equipment to search for electronic eavesdropping in China.

Another company said they had to be very careful when buying new buildings in China because a lot of the office buildings are filled with electronic eavesdropping bugs.

Finally, an executive of an American company sent a fax from his hotel in China to the U.S. to get advice on a business deal. Later, when he talked to his Chinese counterpart, surprisingly (or not), the Chinese already knew the content of the fax.

Prof. Feldman’s advice? Foreign companies need to be very careful guarding their information while doing business in China.

He also talked with me about his observation of China’s current anti-corruption campaign, and what kind of role “the middleman” plays in China’s complicated business environment.

Please click here to read or listen to all the interesting insights Prof. Feldman had to share.