Chinese Checkers!

A couple of days ago, a student of mine asked me, as to what I considered, the most important aspects of International HRM. After mulling over the question, I said, training of expatriates and setting up policies to deal with crises that your employees faces when working abroad, would top my list.

I think I was bang on, with the Rio Tinto brouhaha in China. Rio Tinto, a London based metals major, follows a Geo Centric approach to staffing, and in doing so, placed Stern Hu, an Australian, as its rep in China.The issue is further confused because Hu was Chinese prior to turning Australian!

Hu, Rio Tinto's executive in charge of iron ore negotiations in China before his arrest last July, was sentenced in a Shanghai court yesterday to a total 10 years in prison on charges of corruption & bribery. Three Chinese colleagues were imprisoned for between seven and 14 years.

The case was closely watched by foreign companies operating in China. The rulings suggest Chinese authorities are taking a sterner stance toward foreign companies caught violating the country's often selectively enforced corruption code.

It is clear that the Chinese are playing hardball here, obviously miffed by the reluctance that the western world shows in signing extradition treaties with China. The lack of a treaty precludes China from getting its citizens back home to face trial, for offences committed against China.

The Australian's are obviously not pleased. Australia's leader Kevin Rudd said today that secrecy surrounding China's trial of four Rio Tinto workers for commercial espionage leaves room for doubt about the convictions.

Canberra says the jail sentence handed to Australian citizen Stern Hu on bribery charges was harsh, and has criticized the decision to keep media and diplomats out of the court while it considered the other charges of stealing commercial secrets.

I have that that bad feeling that seems to suggest that, this international fracas, is fast spiralling out of control.Rio Tinto said if would fire Hu and his colleagues.

"I am determined that the unacceptable conduct of these four employees will not prevent Rio Tinto from continuing to build its important relationship with China," CEO Tom Albanese said in a statement. The company is increasingly dependent on its business with China.

However corporations would be disappointed at the secrecy of the commercial secrets elements of the trial and chronic corruption that plagues industrial China.China continues to be opaque in many areas.Much of the foreign interest in the case stems from the commercial secrets portion of the charges, because government information controls add a layer of uncertainty and risk to operating in China.

Some of the information the Rio execs are thought to be accused of obtaining illegally -- including detailed mine production and operation rates -- is considered vital market intelligence in China, where official statistics are unreliable.This episode has also placed China, as a business destination,under the scanner, following closely on the heels of Google exiting China, in the recent past, over a spat with the Govt. of China & intense pressure on its business practice, back in the USA.

This is IHRM at its best!It has got all elements of a wonderful drama- International Politics, Business wheeling & dealing, industrial espionage and of course the human touch. A wonderful case study, except that poor Hu, would definitely not be downing 'Fosters' beer & watching Kangaroos, skip across the great Aussie outback, for a while, while politicians across the world indulge themselves in a war of words!