Bringing The Spirit of the Me Too Movement to Trans-Pacific Businesses

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Bringing The Spirit of the Me Too Movement to Trans-Pacific Businesses

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  • Category: Category: Business In China, Sexual Harassment

Women are rising up around the world, claiming a greater role in political and economic leadership. It’s happening everywhere and in the face of differing cultural values, history, and context that otherwise may have allowed for subjugation or discrimination. As difficult as this adjustment may be in the short-term, as women achieve positions of leadership and equal decision making in every level of society, they are bringing meaningful benefits to businesses, governments, and communities.

Of course, no single culture can lay claim to originating the ideals of gender equality. But the movement for gender equity in the West, as seen most significantly in the Me Too movement, offers helpful insight into how international businesses can move forward on this front. By integrating these new gender norms into their company cultures, trans-Pacific businesses and businesses with operations in China can both improve operations and reduce legal risk.

Gender Discrimination is a Global Problem

Despite global outcry in the wake of the Me Too movement, sexual harassment continues to be extremely common in both China and the United States. One study found that nearly 80% of Chinese women experienced sexual harassment in their lifetime. As terrible as this may seem, it’s not much better in the West. Another survey of U.S. women found that slightly more than 80% had experienced sexual harassment, including verbal harassment, during their lives.

Sexual harassment and discrimination have devastating impacts on the person who is harassed, both personally and professionally. But the problem is not limited to the impacts on the individual victims of gender bias. The many negative impacts that stem from sexual harassment, discrimination, and gender-biased behavior in the workplace also lead to negative business outcomes company-wide. Gender-based discrimination in the workplace often leads to a hostile work environment that causes otherwise skilled and qualified employees to leave their jobs, get passed over for promotions, and miss work time. Discrimination further erodes opportunity for other employees to develop professionally and succeed on the business’ behalf. These issues ripple across the economy, and an increasing number of jurisdictions are passing laws to prevent the damage that it does.

Savvy Businesses Adopt Progressive Policies for Protecting Women in the Workplace

Ethical considerations aside, there are objective risk-mitigation benefits associated with adopting the most protective policies for women in the workplace even when gender biased behavior is not expressly prohibited within your jurisdiction. Having a workplace culture that fosters or condones sexual harassment can quickly become a major risk. There are both financial and public relations risks that businesses need to consider. For U.S. corporations and trans-Pacific companies headquartered in China, there can be significant public relations damages associated with perceptions and allegations of workplace sexual harassment. In response, consumers may boycott your organization or product and future employees may steer away from working with you. Though corporations can’t be accountable for each individual employees’ actions, they can build an organizational focus that doesn’t tolerate workplace sexual harassment.

Promoting economy-wide opportunity begins by eliminating discrimination and gender-biased behavior in the workplace. Companies that are able to minimize sexual harassment in the workplace can hire and retain a more highly qualified workforce. This leads to the development of a more productive work environment. Furthermore, by developing a reputation for being proactive and supportive of the cause of gender liberation, these companies are better able to attract and sustain a dedicated customer base while also eliminating the negative impacts of gender inequality in the workplace.

Companies across the Western world have been improving workplace conditions for women with an aim towards equal treatment of the sexes. Still, the reason why movements like #MeToo have been so powerful is that they uncover subtle yet ongoing issues regarding harassment and gender discrimination lingering under the surface of otherwise progressive corporate cultures. The movement has been powered by women and their economic allies in the workplace, including consumers, managers, coworkers, and leaders. Their collective voices are demanding an end to historical practices that discriminate against women. Around the world, industries are hearing this demand and integrating it into their operations.

Before facing workplace disruption, Chinese businesses and Western business with trans-Pacific operations are wise to get ahead of the curve. This involves rethinking corporate policies and integrating a corporate culture that prioritizes gender equality in corporate practices. Often, these organizations work with liaisons who can help to bridge cultural gaps and ensure that company standards are at or above local and state level laws in the U.S., many of which set a high bar for the protection of women in the workplace. However, the trend towards greater gender equality is global, and international businesses will see meaningful benefits as they move toward gender equity at every level of their operations.

Responding to Evolving Global Gender Norms

Companies that provide opportunity and support for all employees regardless of gender can look forward to two key benefits. First, they will land themselves on the right side of history. Second, they will boost their bottom lines and streamline operations. Being an effective international businessperson requires intentionally practicing local norms in a way that harmonizes global values. Chinese businesses and multi-national businesses based in China alike can improve their operations by integrating a more global view of gender. In so doing, they will also decrease their potential for risk and controversy by integrating westernized gender norms into their business practices.

Multinational business norms are rapidly transforming. Some norms, like greetings or manners, should be learned and used as a way to show respect and courtesy to business partners. Differing cultural practices also make the world more interesting and dynamic, and the excitement of international business relations often attract top talent. Respect for local culture is critical in maintaining good relationships, but some norms, particularly those which reinforce gender discrimination and sexual harassment, can be downright destructive.

The most protective approach to workplace gender norms are embodied by the laws surrounding gender discrimination in local United States and European jurisdictions. Though far from perfect, these laws protect workers from discrimination based on sex. This includes protections against hostile work environments, non-discriminatory pay structures, and an ongoing effort toward stronger scrutiny of improper behavior in the workplace. As concern over workplace protections for women increase, prudent corporations and managers are providing preventive training and disciplinary structures to protect women in the workplace.

Strong Workplace Protection Policies Continue to Expand

International laws differ regarding gender-based discrimination. However, in the United States and other nations, an increasing number of rules and laws are prohibiting gender discrimination. As a result, this inappropriate behavior is growing more and more likely to trigger costly lawsuits and regulatory enforcement actions.

Even in the absence of specific legal prohibitions, many nations are embracing the UN’s seven principles of women’s empowerment to support their workplaces, marketplaces, and communities. These principles provide guidelines for specific corporate actions meant to take aim at gender biases, including ensuring all employees are treated fairly and establishing gender equality at the highest levels of corporate leadership. In addition to ensuring women’s safety, health, and well-being, the UN principles encourage corporate gender equity training and strides designed to improve towards women’s empowerment in marketing and the supply chain. These policies are meant to support community-driven efforts led by women for women and be evident in published metrics that can track the progress of ongoing efforts.

In the U.S., state laws are taking the lead in eliminating harmful sexism and discrimination in the post-Me Too era. In 2019, at least 11 states in the U.S. passed laws intended to close the gender pay gap and prevent wage discrimination based on gender. For businesses operating in the United States, workplace sexual harassment lawsuits can cost millions of dollars, and legal fees are almost always paid by the employer, not the individual who committed the workplace harassment. As a result of these risks, many companies are rushing to provide anti-harassment training to their organizations. The most prudent and forward-thinking corporations active in U.S. markets, will do the same by ensuring their own company policies are reflective of the most stringent state and local laws.

The Rising Tide of Sexual Harassment Law in China

In China, local and national sexual harassment legislation is still in the embryonic stage. Currently, there are only limited standards regarding the definition and express prohibition of sex harassment and few channels that victims can use to seek relief. Questions regarding exactly what constitutes sexual harassment, what liabilities the perpetrator or the employer shall bear, and the specifics of civil liability remain unanswered by current legislation. Even so, an increasing number of executives are being questioned, detained, and shamed following acts of sexual misconduct. This was the case of Li Yuanrong, the former Chief Operating Office of the Xinghe Chuangfu enterprise, who was sentenced to five days’ administrative detention and forced to resign from his position after sexually harassing a woman on an airplane. Wang Zhenhua, the former Chairman of New Town Holdings, was also criminally detained after being accused of child molestation. Civil litigation is also pending against Liu Qiangdong, Legal Representative for JD.com, who was accused of sexually assaulting a woman after a dinner party.

The Supreme People’s Court has yet to address exactly how employers and victims are to deal with cases regarding sexual harassment, and victims often face challenges in carrying the burden of proving allegations of workplace misconduct. [1] However, the lack of express legal protection for women in the workplace does not mean that perpetrators go unpunished for their misdeeds. New Town Holdings shares plummeted more than 26% after the news of its Chairman’s sexual misconduct came to light, which cost shareholders billions of dollars. Likewise, the share price of JD.com stock fell by 16% within just two days of the Liu Qiangdong scandal, reducing the market value of the company by a staggering $40 billion and sending the share price into an all-time low.

China has seen many cases of sexual harassment that are not reviewed by courts of law, but rather the court of public opinion. This type of public shaming affects both the perpetrator and the enterprise the individual represented. Regardless of whether the allegations give rise to civil or criminal penalties, employers bear the legal responsibility to prevent sexual harassment towards female employees and follow up on any allegations.[2] Sexual harassment is generally regarded as a serious violation of an enterprise’s bylaws, accordingly, the employer chooses to fire the employee who carries the sex harassment, that triggers the complain of the fired employee. Even when administrative or criminal punishments are not issued, many enterprises fall into a crisis of trust, causing share prices or revenues to drop steeply. As a result, companies are focusing on ensuring that their workplaces are safe, healthy, and supportive for all genders in China and around the world.

Local Legal Allies Help Maintain a Healthy and Supportive Workplace                                                                                                                 

Companies across the globe are being held to a higher level of expectations driven by a changing workforce and customer base. Best practices to prevent sexual harassment and gender-based discrimination are continually changing. Nevertheless, trans-Pacific companies that are willing and able to adapt their business cultures to be more accommodating and inclusive to all genders will both avoid risks and retain highly qualified employees who are free to do their jobs without fear and worry.

In order to integrate egalitarian gender norms as workplace priorities, Chinese companies will need the assistance of attorneys with experience in U.S. law to serve as a conduit for compliance with Western laws. Likewise, western companies operating in China will need attorneys with experience in both U.S. and Chinese law to guide them through an evolving corporate compliance landscape.

 

[1] The Supreme People’s Court in Notice of the Supreme People’s Court on Increasing Causes of Action in Civil Cases issued on December 12, 2018 just added a third-level cause of action named “sextual harassment” in the section “educational institutions liability disputes”. It must be noted that before the issuance of this notice, in the Circular of the Supreme People’s Court on Issuing the Regulations on Causes of Action in Civil Cases, the “sextual harassment” is not regarded as a cause of action in civil cases.

[2] Article 11 of the Special Provisions on Labor Protection of Female Employees stipulates: Employing units shall prevent and stop sexual harassment towards female employees at the working place.

Peter C. Pang* is Chairman and Managing Partner of IPO PANG XINGPU LAW FIRM., His expertise includes corporate law and formation, franchising – inbound and outbound, mergers and acquisitions, real estate acquisitions, private placement, technology transfer, joint venture formation and business alliances, and trade secrets and intellectual property protection. Mr. Pang’s over 35 years of law practice in the People’s Republic of China and the United States places him amongst a handful of US-China lawyers with Asian International Expertise and in-depth appreciation for both the Western and Asian cultural and business differences and sensitivities. Mr. Pang is an attorney who “not only knows, but knows how” to close a deal, litigate vigorously and represent clients zealously. We don’t sell time, we sell solutions ™.
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