Talking Cultural Diversity

a discussion board for cultural and diversity issues by Thomas Kochman and Jean Mavrelis

Implications of China’s Urbanization on Corporations

By Adrian Chan - 03.13.2014

February 25-26, 2014, Washington, D.C.
The Chief Diversity Officer & Thought Leadership
An in-depth conversation  about the global impacts of identity, labels and colorism on societies, communities and businesses.

Implications of Global Immigration and Migration Panel Discussion
Statement made by panel member, Dr. Adrian Chan (,VP & Head of Asian Pacific Operations for Kochman Mavrelis Associates on February 25, 2014 at the German Marshall Fund, Washington, D.C.:

Nobel laureate and economics professor Joseph Stiglitz recently said that the two most important trends or forces that will shape the world’s development in the 21st century are: 1) the technological developments in the USA, and 2) the urbanization in China.

It is easy see how dramatically and quickly USA technological innovations and their applications have transformed us personally, politically, and societally, here and throughout the world.  But the rural to urban transformation in China is slower to realize, a bit like watching grass grow.

Under Mao Zedong in 1949, China’s population was 90% rural and 10% urban.  Under the 1980 leadership of Deng Xiaoping, it was 80% rural and 20% urban.  But during the next thirty plus years China’s modernization program was such that by 2013 the urban population, for the first time in China’s history, surpassed its rural population, 51% to 49%.  Approximately 700 million Chinese now live in urban cities, while 650+ million still reside in the countryside (total population around 1.3+ billion people)  This is the largest migration in the history of humankind in such a short period of time (and still going on).  Given the same timeframe, India’s population went from 90% rural 10% urban to its current 70% rural, 30% urban (total population around 1 billion+ people).

But such massive migrations within a short time span are always complex and not without consequences.  Central to population movement is China’s hukou (household registration) system where people born in cities are considered residents of these urban areas and enjoy the privileges/benefits of the housing, health, education & welfare systems.  Not so for the rural people (residents of their rural origins) who come to the urban areas to help build and modernize China, as they are considered non-residents and therefore not privy to the same benefits as city residents.  These rural migrants (nongmingong) who work in urban areas can only afford to live in low-income housing, work at lower wages (the urban worker makes 2-3 times the amount in wages than the rural worker), are denied educational access for their children (or cannot afford a higher “non-resident” cost education for their children), nor have their health and welfare needs met.

Out of China’s rapid modernization program has emerged an affluent middle class (mostly from urban settings) whose children are wooed by USA universities because they can now afford to pay the high foreign student tuition and other costs while studying at USA higher education institutions.  The number of foreign students from China has jumped from approximately 50,000+ five years ago to over 200,000+ students currently (Indian students jumped from 50,000+ five years ago to over 100,000+ students currently). Also, Chinese students are actively recruited by USA and European universities as the PISA 2012 results show that Shanghai high schoolers scored the highest in the world in reading, math and science (students from Singapore, Hong Kong, Japan and South Korea are also among the top ten in the world).

As USA companies do business in/with China and vie for Chinese talent to work there and here, we tend to recruit those top-notch Chinese who have graduated from their 985 or 211 (Ivy League or elite) universities or from our prestigious USA universities. In so doing, USA companies ignore the also talented and educated Chinese from the rural migrant groups who (cannot afford to go to China’s elite universities, but) graduated China’s less prestigious universities.

The 3Ps of People, Planet and Profit/Performance is common theme for many USA corporations.  Actualizing these principles as part of corporate social responsibility via doing business in China means acknowledging their rural-urban complexities/dilemmas and collaborating to help alleviate their rural-urban gap. This is analogous to USA universities and businesses recruiting not only our mainstream top-notch talent but talented people who come from low-income, first generation educated, and/or underrepresented groups.


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