How China outsources regulatory function to Walmart – An example of a lucrative emerging market niche in China


If you’ve not already seen it, I highly recommend Orville Schell’s recent article on Walmart and China.

This is quite an interesting story about Walmart, but an even more interesting one about China.


Leaving aside the fascinating observations on Walmart’s “green realignment”, the story for me here is that:

(1) The Chinese government seems to be happily outsourcing some of the attainment of its policy objectives to a foreign-owned multinational corporation (one cooperating with NGOs, no less)

(2) Barriers are being tacitly removed, and the foreign MNC is achieving success and making money

(3) Human rights and brand negativity issues for the foreign MNC seem largely avoided – indeed, to an extent, the opposite.

Doing (2) and (3) at the same time is a big win for foreign companies in China. At the same time, outsourcing or amplifying the attainment of certain policy goals outside the intra-polity web of relationships can sometimes be more effective for the Chinese central government than using/enforcing a direct regulatory approach. Read the account of Lee Scott’s “Get Green Religion” meeting to Walmart’s suppliers in Beijing

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