Guloien: Time to Get Real About China

| About: Manulife Financial (MFC)
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By Tara Perkins

In the wake of Google Inc.'s (NASDAQ:GOOG) decision to shut its search engine in mainland China and move its service to Hong Kong, and a Chinese court's ruling that imposed jail terms on four employees of Rio Tinto (RTP) who were charged with bribery, there has been much talk about whether China is becoming a harsher place for foreign corporations.

“I think a lot of companies go into China with unrealistic expectations, and frankly very little knowledge about how business is conducted in China or Asia more broadly,” Manulife (NYSE:MFC) chief executive Don Guloien says. (He wasn't commenting on Google or Rio Tinto specifically.)

Businesses that play by the rules and establish a reputation for avoiding bribery and other tactics may find it easier to navigate Asia’s business climate, he suggested.

In 2002, an Indonesian court declared an Indonesian operation of Manulife’s bankrupt, even though it wasn’t (the Supreme Court later overturned the decision).

“You can imagine that problem could be solved multiple ways,” Mr. Guloien said. “Manulife did not ever get involved in anything like bribery to resolve the issue; we dealt with it through the Supreme Court.”