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Guanxi, a two-edged sword! How Australian accounting professionals view the process within a moral framework

Ying Han Fan (School of Accounting, Curtin University, Perth, Australia)
Gordon Woodbine (School of Accounting, Curtin University, Perth, Australia)
Glennda Scully (School of Accounting, Curtin University, Perth, Australia)

Managerial Auditing Journal

ISSN: 0268-6902

Article publication date: 26 August 2014

Abstract

Purpose

The purpose of this study is to determine how Western business practitioners, specifically Australian accounting professionals, identify with the Chinese value concept of guanxi and the impact of their perceptions of guanxi on their ethical decision-making. This objective is predicated by a belief that aspects of guanxi are similar to the Western concepts of social networking and would be identified by practitioners as an organizational process providing positive benefits to those associated with its application. Further, it is anticipated that concepts of guanxi influence the way Australian accountants form ethical judgements and intentions, precursors to acceptable moral behaviour.

Design/methodology/approach

A cross-sectional questionnaire based on a survey of 111 usable Australian accounting professionals was completed during 2012. A confirmatory factor analysis was used to validate each construct of guanxi before a path analysis was performed.

Findings

Australian accounting professionals associate well with the favour-seeking aspects of guanxi, suggesting an affiliation with Western concepts of social networking. Both groups (i.e. public accountants and private accountants) reject rent-seeking guanxi as clearly unethical. Rent-seeking guanxi is seen to directly influence ethical judgement and intention; however, their favour-seeking guanxi attitudes do not influence ethical judgement or intention, regardless of employment type. Public and private accountants apply guanxi in a differential manner when determining moral intention. Public accountants are viewed as acting spontaneously without adequately considering the consequences (via the judgement phase), which appears to be a function of the nature of their personal association with the case study applied in this research.

Originality/value

The research provides evidence that Australian accounting professionals relate to favour-seeking guanxi as representative of a broader notion of social networking. In this context, the guanxi instrument appears to be amenable to cross-cultural evaluations of group behaviour. Significant differences of opinion exist compared to the prior Chinese studies when unethical practices are considered. The guanxi instrument proves to be a useful tool when examining the group interactions involving Western professionals and also helps establish differences in moral constructions based on employment types.

Keywords

Citation

Han Fan, Y., Woodbine, G. and Scully, G. (2014), " Guanxi, a two-edged sword! How Australian accounting professionals view the process within a moral framework", Managerial Auditing Journal, Vol. 29 No. 8, pp. 695-716. https://doi.org/10.1108/MAJ-11-2013-0957

Publisher

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Emerald Group Publishing Limited

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