China’s “Harmonious Society” Challenges Corporate Japan: Towards a Dual Vision of Profitability and Social Responsibility

Abstract

Anti-Japanese sentiment in China since the Second World War has been exacerbated by recent territorial disputes involving the Senkaku Islands and the natural resources of the East China Sea. The widespread dissemination of anti-Japanese propaganda by the Chinese media has further contributed to this negative image of Japanese corporations. This pervasive climate of anti-Japanese sentiment has forced Japanese companies seeking to expand their businesses abroad to grapple with the unique challenges of navigating the highly politicized environment of Chinese harmonious society. Still, the success of any foreign companies in China fundamentally depends on whether China’s market economy continues to develop in the face of harsh political conditions and growing social unrest. To date, only a handful of studies have addressed the effects of Chinese harmonious society on the performance of Japanese corporations operating in China. This study is an attempt to fill that gap.