As companies grow their presence in markets along the Belt and Road, it will be critical that they explain who they are, how they operate, and their commercial goals in order to build greater trust and credibility.

A strong reputation is critical to the success of Belt and Road projects. Reputation directly impacts the ability of companies to secure government support, recruit local employees, attract high quality partners, and earn community backing. A good reputation makes success more attainable, while a poor reputation can threaten a company’s social license to operate.

A recent survey of 4,200 adults in 14 Belt & Road countries across Asia by the Brunswick Group in 2019, the Middle East, Africa, and Eastern Europe sheds new light into how Chinese businesses need to communicate with new audiences as they expand internationally.

Chinese companies have a good reputation along Belt and Road markets. More than three in four (78 percent) members of the general public in these countries say they have a favorable opinion of Chinese businesses. Moreover, nearly three in five (58 percent) adults in Belt and Road countries view China as their top choice for cooperation on development and infrastructure projects in their countries. These findings indicate there is much openness to Chinese firms and the expertise and support they can bring.

But there are also important challenges in how Chinese businesses are perceived along the Belt and Road. Nearly two in five (39 percent) members of the general public in these countries believe that their government is allowing too much Chinese investment into their country. This sensitivity to Chinese investment is even higher in places like Kenya (71 percent believe there is too much Chinese investment), Kazakhstan (49 percent), Pakistan (45 percent), Indonesia (45 percent), and Malaysia (44 percent).

Concerns about the volume of investment flowing into Belt and Road countries appears to be underpinned in part by a view that Chinese businesses underperform in areas that are key expectations of local populations. The populations of Belt and Road countries believe that Chinese companies have a weak track record of performance in terms of environmental protection, employee treatment, transparency, and engagement with local communities. This is important because out of 17 business activities that were tested in the survey, these four ranked among the highest in terms of the impact they have on public trust in companies of any type. Chinese companies will need to communicate what they are doing to meet these important expectations in order to create deeper trust and stronger reputations.

The survey demonstrates the critical role trust plays in successful international expansion. People in Belt and Road countries say that it is as important for the leaders of Chinese companies operating in their communities to ensure they are trusted (69 percent) as it is to deliver high quality products and/or services (74 percent). And they say establishing trust is more important than growing profits (48 percent).

The research also uncovers a strong linkage between communicating with local communities and building trust. Respondents who have received more information about Chinese companies report substantially higher levels of trust and support for Chinese companies compared to respondents who have received little or no information. Local knowledge and exposure are the keys to a Chinese firm’s success abroad.

However, Chinese companies could be more effective at communicating with international audiences. Only 12 percent of populations in Belt and Road countries report having seen, read or heard information directly from Chinese companies. Local populations are receptive to this type of information. More than one in three (36 percent) say they trust information that comes directly from Chinese companies, ranking this above all other information sources except for media reports (54 percent). International audiences would welcome more active and direct communication from Chinese companies. Engaging with trusted media is also of critical importance.

While the research points to several concrete actions Chinese businesses can take to enhance their positions abroad, it is important for all companies involved in Belt and Road projects to ensure greater understanding of among international audiences to creating more positive perceptions. This cannot be done without more and better communication. Communications demonstrates transparency and plays a critical role in building trust for any company.

Companies that are operating internationally or planning on doing so should take the following steps to ensure their ambitions are achieved.

First, before moving into to a new market, companies need to take the right steps to prepare for expansion. Companies need to identify and understand the issues that impact a business in the local market. Opinion research can help to pinpoint expectations and concerns that need to be addressed. Anticipating concerns will allow companies to develop a mitigation plan in advance rather than waiting until problems occur.

Communications goals need to be aligned with the audiences that have the potential to impact business outcomes. Firms need to understand key stakeholders and influencers for their business, as well as their perceptions of the company. Mapping the goals and concerns of all who could have potential interests in a company’s operations can help prevent an issue from becoming politicized and problematic.

This information will allow businesses to develop a communications plan. Communications plans detail when and how to engage with stakeholders. Staying quiet will not keep a company out of the news, and unwillingness to engage and answer questions can be a reputational liability. Scenario planning and crisis preparedness help if a business encounters difficulty.

Second, during a company’s entry into Belt and Road countries, businesses need to communicate and engage local stakeholders. Businesses need to tell their corporate story, demonstrating their value and track record and tailored to resonate with key audiences. The value of a company’s expansion needs to go beyond the financial rationale and explain the benefits to the local economy, employees and society. Careful monitoring of sentiment enables businesses to carefully to strike the right tone and level of visibility.

Compelling communications materials and websites that are designed to appeal to local and global audiences are important for getting a company’s story to reach stakeholders. Companies need to create these types of communications materials. Collateral about business operations should be translated into the local language and be of the same quality as leading global businesses.

After a company has developed its story and supporting materials, it needs to prepare company spokespersons to understand nuances of the local media, political, and business landscape. This allows businesses to position themselves for successful engagement with key stakeholders. Regular engagement helps build support for business objectives in the local market. Companies should engage with relevant stakeholders – government, regulators, media, academics, etc. – who can influence perceptions of the company.

Third, throughout the life of a Belt and Road project, companies need to sustain engagement and communication with local stakeholders. Transparency builds trust. Engagement should include regular in-person meetings between senior company leaders and key influencers to help avoid misperceptions. In-person contact puts a face to the organization and deepens understanding.

Ensuring political decision makers have a proper understanding of a company’s business objectives is also of critical importance. Any delay to engage will increase risk that the communications vacuum is filled by other, more critical voices. Explaining how a company will help the local economy helps insulate the company from hostile rhetoric.

Evaluation of the effectiveness of communications and engagement programs will help a company adapt to changing context. Businesses should conduct regular perception audits to assess stakeholder opinion and evaluate progress of communications activities. The findings should contribute to future communications objectives.

Focused communication advances business goals and help companies achieve success along the Belt and Road.

The author is a director with the business advisory company Brunswick Group.

The author contributed this article to China Watch exclusively. The views expressed do not necessarily reflect those of China Watch.

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