Comments on: China Foreign Investment Advice: When In Doubt, Use Common Sense http://www.chinahearsay.com/china-foreign-investment-advice-when-in-doubt-use-common-sense/ China law, business and economics commentary Thu, 09 Feb 2012 05:55:56 +0000 hourly 1 http://wordpress.org/?v=3.1.3 By: Hang http://www.chinahearsay.com/china-foreign-investment-advice-when-in-doubt-use-common-sense/comment-page-1/#comment-75023 Hang Mon, 03 Aug 2009 14:38:30 +0000 http://www.chinahearsay.com/?p=3332#comment-75023 Trust people, but don't trust only one or two senior executives. Don't let the one/two cut your communication with the 'less important people' who have been working for your company. Trust people, but don’t trust only one or two senior executives. Don’t let the one/two cut your communication with the ‘less important people’ who have been working for your company.

]]> By: Stan http://www.chinahearsay.com/china-foreign-investment-advice-when-in-doubt-use-common-sense/comment-page-1/#comment-75020 Stan Mon, 03 Aug 2009 12:01:47 +0000 http://www.chinahearsay.com/?p=3332#comment-75020 Trust but verify. These are sad stories, because for every one of these guys, there is an asshole manager who doesn't trust anyone. Both situations are disasters. Trust but verify.

These are sad stories, because for every one of these guys, there is an asshole manager who doesn’t trust anyone. Both situations are disasters.

]]> By: allroads http://www.chinahearsay.com/china-foreign-investment-advice-when-in-doubt-use-common-sense/comment-page-1/#comment-75019 allroads Mon, 03 Aug 2009 11:49:53 +0000 http://www.chinahearsay.com/?p=3332#comment-75019 Stan. What pains me about this story is that all the accountants in the world would not have been able to save him because his belief in people was so strong. I had a friend go through nearly this exact same story. He built a China platform, entrusted a single up and coming guy, and that guy went out and set up parallel business within the business. He believed in his people wholly, even when EVERYONE around him was telling him otherwise, and in the end he lost everything. From my view, I don't see a reason to stop believing in people, nor trusting them, however there must be barriers. It is simply unrealistic to think that you can hand over a 50 million USD firm to a 28 year old after a few years and they NOT find a way to better their position in some manner... and that is true no matter where you are. FYI - one of the best guides on due diligence in China is coming out from the UK Chamber. 35 pages of information (<a href="www.jfpholdings.com/assets/pdf/ChamberEye-Summer2008.pdf" rel="nofollow">download here</a>) R Stan.

What pains me about this story is that all the accountants in the world would not have been able to save him because his belief in people was so strong.

I had a friend go through nearly this exact same story. He built a China platform, entrusted a single up and coming guy, and that guy went out and set up parallel business within the business. He believed in his people wholly, even when EVERYONE around him was telling him otherwise, and in the end he lost everything.

From my view, I don’t see a reason to stop believing in people, nor trusting them, however there must be barriers. It is simply unrealistic to think that you can hand over a 50 million USD firm to a 28 year old after a few years and they NOT find a way to better their position in some manner… and that is true no matter where you are.

FYI – one of the best guides on due diligence in China is coming out from the UK Chamber. 35 pages of information (download here)

R

]]> By: Stan http://www.chinahearsay.com/china-foreign-investment-advice-when-in-doubt-use-common-sense/comment-page-1/#comment-75016 Stan Mon, 03 Aug 2009 05:44:25 +0000 http://www.chinahearsay.com/?p=3332#comment-75016 The CB piece was mostly on auditing, and it kind of approaches what happens when a company has suspicions that something weird is going on. Some good points on how to track down and deal with this kind of problem. This is slightly different, however, than what I was talking about. While the CB piece focuses on existing problems, I was basically saying that companies/managers could avoid all this in the first place by using common sense. This is indeed not really a legal issue. It's a management problem, and a simple one (at the outset). If you do not apply common sense to your management, then later on you will definitely need the help of accountants and lawyers! The CB piece was mostly on auditing, and it kind of approaches what happens when a company has suspicions that something weird is going on. Some good points on how to track down and deal with this kind of problem. This is slightly different, however, than what I was talking about.

While the CB piece focuses on existing problems, I was basically saying that companies/managers could avoid all this in the first place by using common sense.

This is indeed not really a legal issue. It’s a management problem, and a simple one (at the outset). If you do not apply common sense to your management, then later on you will definitely need the help of accountants and lawyers!

]]> By: HKGweilo http://www.chinahearsay.com/china-foreign-investment-advice-when-in-doubt-use-common-sense/comment-page-1/#comment-75015 HKGweilo Mon, 03 Aug 2009 05:35:28 +0000 http://www.chinahearsay.com/?p=3332#comment-75015 China Briefing also ran the story Stan, and additionally provided intelligent advice from Dezan Shira on specifically how to avoid getting into those sorts of problems. "Keeping Your China Partner Honest" - it's here: http://www.china-briefing.com/news/2009/07/31/keeping-your-chinese-partners-honest.html. It seems more an accounting management issue than a legal one to be honest. China Briefing also ran the story Stan, and additionally provided intelligent advice from Dezan Shira on specifically how to avoid getting into those sorts of problems. “Keeping Your China Partner Honest” – it’s here: http://www.china-briefing.com/news/2009/07/31/keeping-your-chinese-partners-honest.html. It seems more an accounting management issue than a legal one to be honest.

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