China’s Outrage Culture Packs a Mean Punch
UBS is the latest company to cave to irrational but politically powerful demands.
Chinese social media was aflame with controversy last week. But it wasn’t about Hong Kong, where millions of people were protesting. It wasn’t even about the trade war or Huawei (for once).
No, it was about pigs. Actual farmyard, pork-producing pigs. But which the Chinese internet mistook for something substantially more personal. Last week, the Swiss financial services firm UBS released a report commenting on rising consumer prices in China, featuring a particularly dry turn of phrase from Paul Donovan, the chief economist at the company:
Chinese consumer prices rose. This was mainly due to sick pigs. Does this matter? It matters if you are a Chinese pig. It matters if you like eating pork in China. It does not really matter to the rest of the world.
But Donovan’s comment about “Chinese pigs” was soon causing a whirlwind of controversy in China, where a community of netizens ever on the lookout for slights from foreigners decided that “Chinese pig” must be a reference to the Chinese people themselves. Their argument was that “pig” is supposedly a common slur in Chinese, so that also must have been Donovan’s intent when writing in English. This is despite the fact that Donovan is an economist who has built his career in the U.K., does not seem to have ever lived in China, and has never claimed to speak Chinese.
A chorus of influential figures also joined the pile-on. Hao Hong, a professor at the Tsinghua Zijing-Kelley School of Business, remarked in a since-deleted tweet that “research should not be used as a racist propaganda instrument.” The nationalistic government-controlled newspaper Global Times also wrote that the UBS report “used distasteful and racist language to analyze China’s inflation.” The Chinese brokerage firm Haitong International Securities announced that it was cutting ties with UBS over the incident, and the Chinese Securities Association of Hong Kong demanded that Donovan be sacked. The fact that Donovan was clearly talking about the country’s pork industry—actual, porcine, spiral-tailed Chinese pigs—on an economics podcast was no impediment to his critics. (It should be noted that some Weibo commenters did also come to Donovan’s defense.)
In response to the furor, UBS published an apology and announced that it was placing Donovan on a leave of absence pending further review. Many of his colleagues—if comments left under a recent Financial Times article are anything to go by—were not happy with this decision. But it was all too typical of the way that firms have started to treat politically ferocious demands from the Chinese public—and government.
Outrage is a common currency on the modern internet, but these howls of anger from netizens have a distinctive and particularly Chinese quality. Much of this quickness to anger is a product of modern mainland culture. For decades, through education, propaganda, and an endless parade of dreary TV dramas, the (very real) wounds inflicted on China by foreign powers in the 19th and 20th centuries have been recast into the narrative of a “century of humiliation.”
This story of China’s decline and eventual rebirth is used by the Chinese Communist Party to burnish its own authority as the only power that can make China stand up against foreigners, who are always seeking to keep the nation down. As a result, it can be difficult to tell where online outrage is choreographed by the state and where it has sprung organically from genuine and strongly held feelings of grievance. Often it is both.
UBS’s apology and its unsentimental sidelining of Donovan might seem surprisingly craven to some, but the pattern will be familiar to anyone who has followed the reputational roller coaster of multinational companies accused of “hurting the feelings of the Chinese people” that has become particularly common in recent years. Whether directed from above or springing from below, the language and tone of the outrage is often strikingly similar.
In January 2018, China demanded apologies from a number of international companies, including Zara, Marriott, Qantas, and Delta Air Lines, for listing Taiwan and Hong Kong as “countries” on their websites. All companies quickly apologized to China and removed any offending references. Marriott’s apology affirmed that the company “respects the sovereignty and territorial integrity of China. We don’t support separatist groups that subvert the sovereignty and territorial integrity of China.” That broadened into a wider demand directed at airlines over Taiwan later that year—a demand that was almost universally complied with.
In February 2018, the car manufacturer Mercedes-Benz was also forced to apologize after a quotation from the Dalai Lama (a persona non grata in China for his advocacy of Tibetan independence) was posted on the brand’s English-language Instagram account (accompanied by the hashtag #MondayMotivation).
For multinationals battling a public relations crisis, the playbook in this situation appears straightforward—simply respond quickly, blame the problem on an isolated human error, and enthusiastically state agreement for the Chinese Communist Party’s version of reality. And as far as the short-term bottom line is concerned, this approach seems to work. Zara, Marriott, Qantas, Delta Air Lines, and Mercedes-Benz all remain in business in China, and senior executives probably believe the embarrassment of submitting to the party’s demands is a small price to pay for the bounties on offer in such a gargantuan consumer market.
Yet executives would be wise to consider alternative approaches for containing sporadic bursts of anger from Chinese internet users. The current strategy largely works because multinationals usually have to choose between offending China and either a much smaller consumer market (such as Taiwan) or an almost voiceless population unlikely to cause them many problems (such as the people of Tibet).
But the Chinese government increasingly seems to be on a collision course with far more powerful entities. Recent huge demonstrations in the small but influential territory of Hong Kong clearly have showcased a growing anti-mainland sentiment, which is likely to further politicize any demands that Hong Kong is not referred to as a “country.”
Across the Pacific, there appears to be an ever-growing willingness in Washington to confront the Chinese government head on, and the current Huawei-focused standoff may only be the start of a long period of tension with plenty of flash points. Ahead of Beijing’s hosting of the 2022 Winter Olympics, some activists are already discussing targeting major corporate sponsors, such as Coca-Cola, General Electric, and Procter & Gamble to draw attention to China’s imprisonment of Muslim Uighurs in Xinjiang. Similar calls for action are also being made by powerful figures in the U.S. government, such as Sen. Marco Rubio, and other sponsors of potential Magnitsky Act-like sanctions over Xinjiang. A Moscow Olympics-style boycott by the United States might be a stretch, but it’s no longer an impossibility.
For multinationals, therefore, it’s possible that they will be forced to choose between their Chinese business and the optics of endorsing detention camps. The nightmare scenario is that they have to choose (heaven forbid!) to operate in either China or North America. The current policy of acquiescing to every perceived slight only makes such scenarios more likely, as the Communist Party and an army of online commentators are taught their behavior is always rewarded with a swift and humiliating apology.
Unless multinationals find a better way of dealing with outrage from China, the scale of the problem is only likely to grow as small concessions empower both the Chinese government and online mobs to demand more.
For UBS, sidelining Donovan with a quick apology might seem the most painless solution. But this sends a message to the rest of the firm’s staff that they will have to think twice the next time they have to make public comment about China, knowing that UBS will not support them if their comments are twisted by third parties. And now that a precedent has been set, there’s nothing to stop patriotic Chinese netizens turning their fire on UBS the next time the company makes a less than bullish pronouncement about the Chinese economy.
Executives are no doubt worried that standing firm will cause negative consequences for their companies. But UBS’s response to the current furor seems not so much decisive as panicked. The company could have found a middle ground where it announced an investigation into the matter but also firmly stood by Donovan and made clear that this was a controversy caused by mistranslations from individuals with no relation to UBS.
Looking to the long term, industry groups and chambers of commerce need to think about how they can collaborate to confront this issue together. At the moment, crisis PR planning is undertaken at an individual company level. Yet a reputational assault on one company often has consequences for an entire industry. It would be easier for individual companies and executives to stand firm if they knew their competitors and other industry stakeholders had their backs. After all, kicking out one foreign airline would be easy for the Chinese Communist Party. Kicking them all out, however, is a lot harder.
Such collaboration is of course harder than it sounds and would require substantial international cooperation from both industry and governments. But the alternative is to continue playing the humiliating game of appeasing Chinese objections, however absurd they might seem, and to do nothing about the potentially enormous reputational storm gathering on the horizon.