Business Ethics, Corporate Social Responsibility and Taxation – Chinese Policy and Practice

Abstract

International organisations, corporations and governments, including the Chinese government, have come to support both the concepts of the responsibility of business enterprises to adopt and implement codes of corporate social responsibility (‘CSR’), and of the need for businesses to act in an ethical fashion. Thus, in China, the government and its agencies, including the Chinese stock exchanges, actively encourage the adoption by Chinese corporations of codes of social responsibility and the conduct of business in compliance with standards of social and business ethics. Chinese regulatory requirements in relation to ethical conduct and the implementation of principles of social responsibility for enterprise and corporations are specifically extended to the operations of Chinese companies, both state-owned and private, outside China. The content and substance of ethical conduct in the business context and the relationship of ethics to concepts of corporate or enterprise social responsibility is, however, difficult to define. One aspect which is of increasing interest is the relationship between corporate ethical responsibilities, CSR and taxation. The purpose of this article is to look at the international and Chinese concepts of ethics and CSR, primarily as manifested in Chinese legislation and regulation, with a focus on the role of tax and tax policy in requirements relating to business ethics and social responsibility.

Keywords: Business Ethics, Taxation, Chinese Policy, Corporate Social Responsibility

JEL Classification: K34