In search of common ground for dialogue on image

At the start of 2009, doom and gloom shrouded China as the ripple effect of global economic downturn began to be felt on its economy. So there was lot of doubt over China's ability to keep the economic engine running and running well.

The odds were high against China, because of the unprecedented economic and financial calamity across the globe and the mounting task at home to incentivize consumption. But it still managed to pull off an economic miracle.

At the end of the year, its economy registered an annual growth of close to 9 percent, and moved closer to surpassing Japan as the world's second-largest economy.

China's economic growth last year outpaced the world's major economies. The Chinese government is now fine-tuning its policies to better manage the economy. This is important because China (and the rest of the world) faces a number of risks this year and in the years to come. Faced with a number of potential risks in these turbulent economic times, the government and business leaders realized the importance of making the country's economic success sustainable. How China manages risks to build on last year's success is crucial to the continued growth not only of China's economy, but also of the world economy as a whole.

China's exports in December rose, resuming its growth path after months of decline. It was a hopeful sign and the latest indication that global trade is improving. The change of direction came a year after the Chinese government announced a 4-trillion-yuan ($586 billion) stimulus package. It focused on massive bank lending and public investments in infrastructure to overcome the global economic slowdown and offset the erosion in global demand for its exports, which has been a key driver of China's economic growth.

Although China overtook Germany as the largest exporter last year, its exports sector has been plagued by a number of product quality problems. This has the potential to create a systemic problem for products of any variety sourced in China, not to mention the impact on its export-sensitive economy if product quality and safety problems persist.

Starting from late last year, four Chinese trade groups, with the endorsement of the Ministry of Commerce, launched a TV commercial on CNN Asia, which is now spreading to other media outlets around the world. Through this ad campaign, the Chinese government appears to be acknowledging the need to prevent further damage to its economy because of product quality and safety problems and to protect the China brand from further erosion because of the rising trend of trade protectionism around the globe.

The TV commercial's "Made in China, Made with the World" tagline resonates the importance of popular opinion well. It reflects the awareness among senior decision-makers that China must have its voice heard and should heed to and work to influence consumers' perceptions on its products. Studies suggest that a country's image is a halo for its brands.

If China's image can be enhanced, the China brand nurtured over the past two decades and strengthened over the last few years will have a strong halo effect on Chinese brands and businesses aspiring to compete in the international market.

While helping Chinese brands or businesses to go global, the government should redefine its role by seeking a common ground of dialogue, addressing adequately issues of common interests and working to lead all businesses toward a more balanced, eco-friendly and sustainable growth.

The world has seen that the Chinese government's priorities are strengthening legislation to ensure product quality and safety, establishing a better workplace environment, and trying to change the country's image on the global stage as a peace-keeping force.

As is often the case in China, once the government takes the lead, industries will soon follow. More and more Chinese businesses are examining and enhancing their corporate governance practices to build credibility and create a positive reputation in the marketplace, both domestic and overseas, so that they can use the positive reputation to capitalize on opportunities.

In a major Fleishman-Hillard survey in September 2009, almost three quarters of the respondents said a China-dominated Asia will be the most influential region in the commercial world by 2020. About 130 high-ranking business executives, government officials and regulators, think-tank leaders and academics were polled for the study.

The study shows Chinese/Asian multinationals have to overcome a number of challenges in order to capitalize on opportunities beyond their home markets. Lack of profile and branding is their single biggest weakness.

No business or branding strategy in the 21st century can claim success if it fails to build a strong product, cultural and international and corporate social responsibility strategy.

It is vital to safeguard the reputation of a company and strengthening a company's values among other attributes surrounding the overall brand equity.

Corporate social responsibility (CSR) and sustainability are becoming part of the fabric of the relationship between brands and consumers, according to Alex He, Fleishman-Hillard Shanghai general manager who spent six years at McKinsey & Company counseling multinationals and Chinese companies on branding and overseas expansion. It is very important that CSR is not an isolated component of corporate footprint. Instead, it should be an inherent part of a company/brand DNA.

Individuals recognize the magnitude of changes taking place in the economy, society and environment and they are holding companies accountable for their products. They understand the positive or negative impact companies/brands can have.

The rapid proliferation of social media channels has given consumers unprecedented voice in shaping the perception of a company/brand's reputation.

On the flip side, social media is a boon for communications professionals because it helps them educate the public about a company's efforts.

The author is senior partner and president of Fleishman-Hillard China, an international communications company.

(China Daily 02/09/2010 page9)