In the West, Saturday’s election in Taiwan is being analyzed primarily due to future relations with China and the accompanying risk of war. This issue has recently hardly played a role in the election campaign on the ground, writes David Demes from Taipei. But of course, all candidates have long developed a detailed agenda on how they plan to shape relations with their big neighbor should they win the election.
One thing is clear: Be it Lai, Hou or Ko – all candidates align themselves with public opinion in Taiwan. They may have different approaches, but when it comes to rapprochement with Beijing, none want to push the envelope too far. Instead of a radical change in relations, all of them more or less want to continue maintaining the status quo.
The fact that autocracies and totalitarian regimes are on the rise around the world puts many company executives in a bind: How to make a profit and sleep peacefully at the same time? Caspar Dohmen interviewed business economist Markus Scholz from the Technical University of Dresden, who explains that there can be no more “business as usual” with countries like China.
Companies should no longer pass on their individual responsibility to global institutions. After all, they are often too weak, too slow and simply incompetent when it comes to issues such as AI monitoring. Looking the other way can cause enormous costs, Scholz says. Ethical issues should be part of risk management.
International reporting on Taiwan is mainly dominated by China and cross-strait relations. In the domestic discourse, however, Beijing and the danger of a possible military conflict have hardly been mentioned recently. Instead, the Taiwanese press and the various political camps focussed on real estate scandals aimed at questioning the credibility of the candidates.
During the official TV debates between William Lai (DPP), Hou Yu-ih (KMT) and Ko Wen-je (TPP) on December 30, candidates were confronted with an unusually high number of questions about their strategy concerning future relations with China. In the official election notifications, which were delivered to mailboxes across the island in early January, the issues of national security and cross-strait relations were also at the top of the list of the various election programs.
China.Table has taken a closer look at the election programs and past statements of the candidates regarding their positions on China and a global risk assessment.
Tsai Ing-wen’s former rival, William Lai, has become one of the president’s biggest supporters during his time as vice president over the past four years. His stance on Taiwan’s status and relations with China has also now adapted to the social mainstream.
During his time as mayor of Tainan, Lai described himself as a “pragmatic worker for Taiwanese independence.” During the election campaign, he reinterpreted this term, following the political legacy of his boss, Tsai Ing-wen: Taiwan is already an independent state called the “Republic of China,” Lai said. Therefore, a separate declaration of independence was not necessary. This reinterpretation of his statement preserves its essence and simultaneously defuses it.
During a TV appearance where the candidates were to present their election programs, Lai rejected the criticism of his position and pointed out that, in China’s eyes, all candidates for the presidency stand for Taiwanese independence. “Or are you running for the office of Chief Executive?” he asked his opponents, referring to the title of the head of government of the Chinese Special Administrative Region of Hong Kong.
During the TV debate, Lai also declared that China posed the greatest threat to Taiwan’s survival. Nevertheless, the 64-year-old has repeatedly emphasized that his door will be open for talks with Beijing if he is elected – the only condition: Equal rights and dignity, in other words, a dialogue at eye level.
Whether Xi Jinping’s government will accept Lai’s offer is doubtful. In the run-up to the elections, the Chinese side repeatedly labeled Lai a “troublemaker” and a “destroyer of peace.” During the election campaign, the Chinese Taiwan Affairs Office echoed the KMT’s rhetoric and publicly declared that the people of Taiwan had a choice between peace and war, prosperity and decline.
Lai plans to strengthen the defense capabilities of the Taiwanese military further and continue Tsai’s submarine, ship, and aircraft projects. The plan is to strengthen Taiwan’s economic resilience, secure supply chains, and further reduce its economic dependence on China. Lai accuses the opposition KMT of wanting to return to the path of economic dependence on China.
Former police officer Hou Yu-ih from the KMT likes to present himself as a law-and-order candidate who fights for the security of the Republic of China without a bulletproof vest in a hail of bullets. However, when asked during the debate who the biggest threat to Taiwan’s sovereignty was, he avoided mentioning Beijing by name. Hou favors a renewed rapprochement with the People’s Republic and further economic integration.
Hou’s campaign is led by King Pu-tsung, the closest confidant of former President Ma Ying-jeou, who was in office until 2016. It is, therefore, no surprise that Hou’s China strategy is based on Ma’s principle of “no unification, no independence, no armed conflict.” In his election campaign appearances, however, the focus was often more on his rejection of Taiwanese independence than on rejecting a possible unification with China.
KMT member and Sun Yat-Sen School Director Chang Ya-chung believes that Hou’s political program lacks concrete solutions and is trying to avoid the issue of cross-strait relations. “Ma just kept putting off the issue. The longer it could be put off, the better. Hou is trying to avoid the issue altogether,” says Chang.
Despite the planned rapprochement with China, Hou promises to continue investment in national defense if he wins the election and to increase defense spending to three percent of gross domestic product (currently around 2.4 percent).
Ko rose to prominence during the 2014 Sunflower Movement and was later elected mayor of the capital, Taipei, with the support of many activists and the DPP. There, he had the opportunity to gain experience in dealing with China. At the annual Shanghai-Taipei City Forum, Ko repeatedly declared that Taiwan and China were “part of the same family.”
Kos’ pro-China statements caused the DPP to gradually distance itself from him and finally nominate its own candidate for mayor in 2018. During the election campaign, he also announced his plan to relaunch the trade-in-services agreement with China. A demand that Hou Yu-ih also supports.
Furthermore, he believes Taiwan is not yet ready to join the CPTPP free trade agreement and should instead join the China-dominated RCEP. However, many former activists of the Sunflower Movement, which was founded ten years ago as a reaction to the agreement, see Kos’ plan as a sell-out of their values.
Ko presents himself as willing to compromise and prepared to show goodwill towards China. He has devised the “four mutual” principles for relations with Beijing: mutual recognition, mutual understanding, mutual respect, and mutual cooperation.
Borrowing from US Secretary of State Antony Blinken, he favors working with China where possible and confronting China where necessary. Ko believes the so-called “1992 Consensus” is outdated and says that the Hong Kong version of “one country, two systems” has no supporters in Taiwan. “It is China’s responsibility to develop a new concept,” says Ko.
Although the candidates differ in their rhetoric on China, Taiwan’s future president is unlikely to deviate much from Tsai Ing-wen’s approach to relations with China. Most Taiwanese will not accept a radical change in their government’s China policy.
Should a president Hou or Ko attempt to sign a far-reaching trade agreement with China and, in return, sacrifice some of Taiwan’s sovereignty, the island’s civil society is likely to resist, as it did ten years ago.
What does it mean for responsible corporate behavior when global democracies are in retreat and autocracies are on the rise?
If I want to do business in autocracies and sleep peacefully at the same time, I have to do a lot. Unfortunately, the existing global institutions are too weak, slow and increasingly incompetent to adequately tackle certain issues, such as AI. That’s why we need to talk about the individual responsibility of companies and executives. In my opinion, the old adage “the only social responsibility of business is to increase its profits” is no longer valid in an economically globalized world in which autocracies and totalitarian regimes are on the rise.
Should companies withdraw from autocracies so they can sleep peacefully at night?
This depends on the configuration of the respective autocracy and the issues involved. As a manager of a company, I should think about withdrawing if there are intensive and widespread human rights violations and I have little or no influence on what is happening on the ground and, in the worst case, cannot even protect my own employees or am even forced to collaborate with the regime.
What can companies do?
Some support human rights NGOs in autocracies financially, or by providing information; others sponsor the training of lawyers and judges. Sometimes large companies can influence regimes and improve the human rights situation. This is not necessarily the case in China, but sometimes in countries such as Qatar or in some African states. In principle, large oil and gas companies, in particular, have a lot of influence here. It is problematic when companies behave passively, even though they have the opportunity to fight human rights violations. In such cases, it is, to a certain extent, silent complicity.
Do companies sometimes downplay their influence abroad?
Absolutely. Of course, small and medium-sized companies have no influence in China, but I do see a certain amount of power at larger companies, whether car manufacturers or suppliers. This is all the more true when companies jointly coordinate their behavior, for example via chambers of industry and commerce, and also actively cooperate with the governments at home.
How do you generally rate VW’s activities in China?
The company is obviously trying to become even more Chinese, turning even more strongly to the Chinese sales and production market and ignoring the human rights situation there to a certain extent. From VW’s perspective, I understand that they need this market, especially for the upcoming transformation. But staying in China has political and moral costs.
Several large German companies are heavily dependent on business in China. Can you imagine these companies moving their headquarters to autocratic China at some point and thus switching camps?
No, simply because this step would also be too costly. After all, there are other important markets, such as the American and European markets. Conversely, despite all the decoupling fantasies, I don’t yet see how it would be possible to withdraw completely from China. However, “business as usual” will no longer work there in the medium term. China is becoming increasingly totalitarian under Xi Jinping’s leadership and the human rights situation is becoming more and more dire.
Are there any historical comparisons?
South Africa was also an interesting market for German companies during Apartheid. Back then, they used the same arguments to stay in the market. It was called “constructive engagement” at the time. “We protect our employees. We help constructively in the country.” Change through trade was the maxim. But the Apartheid regime remained in place and only ended once there was a strong political and economic boycott, which was also strongly supported by the business community.
Some German companies are also still active in Russia, such as Metro and Rittersport.
But many others left early. Some were more hesitant and wanted to wait and see. Now many want to leave, but now it’s also a bit too late because the regime has reacted and passed corresponding laws. That makes it more difficult for companies. If they leave, they risk a total loss. That is interesting. It shows that ethical issues should actually be part of risk management. If you disregard the moral dimension, you may have to bear considerable financial consequences later down the line.
Do supply chain laws foster the individual responsibility of companies?
It obviously doesn’t work voluntarily. Naturally, legislators should normally also define the ground rules for the economy. This is exactly what has recently happened with the European Supply Chain Act. Nevertheless, acting responsibly beyond legal compliance remains an important issue for companies. All laws have loopholes. What is crucial is that companies do not exploit these loopholes to circumvent the laws.
Does the capital market allow companies to behave this responsibly?
Companies act very differently. During the pandemic, for example, vaccine manufacturer Pfizer tried to get what it could out of the situation by initiating, or at least not preventing, a bidding war between countries. I don’t consider this to be particularly responsible behavior in a situation where millions of lives had to be saved. Pfizer has a relatively large number of strong, active investors, hedge funds, and so on, who want to force top management to achieve high returns.
On the other hand, there are also listed companies in which owner families still have a strong position and tend to pursue long-term interests. Executives may have greater leeway in such constellations.
So, do investors act differently?
Exactly – we cannot generally say that shareholders do not allow any ethical responsibility on the part of management. There is also a trend towards ESG, i.e., investors focus on social and ecological criteria. But we shouldn’t assume that the segment has excessive influence. There is still a lot of room for improvement.
What will happen if more democracies collapse and authoritarian governments establish themselves in even more countries?
Then, the individual responsibility of companies will be even more important. The situation can tip globally – even in Europe. This happened in Germany in 1933, and things are not looking good in Hungary and Italy either, although the situation is, of course, not comparable to that in Germany in 1933. In the US, Donald Trump may be heading for a second term in office. In such cases, the importance of individual corporate responsibility increases. It is not about mindless activism and certainly not about partisan political engagement on the part of companies. It is about protecting liberal democracy and respecting and protecting human rights.
Markus Scholz has been Professor of Business Administration, in particular Responsible Management, at the Technical University of Dresden since October 2022. His research focuses on strategic sustainability management, sustainable change and innovation, business and human rights, as well as political engagement and corporate political responsibility.
The mascots for the 9th Winter Asian Games in China in 2025 were revealed to the public yesterday. Binbin and Nini are inspired by two little tigers that were born in September 2023 in the Northeast Tiger Forest Park in the host city of Harbin. The official slogan of the games, freely translated by the Xinhua news agency, is: “Dream of Winter, Love among Asia” (冰雪同梦，亚洲同心).
In the West, Saturday’s election in Taiwan is being analyzed primarily due to future relations with China and the accompanying risk of war. This issue has recently hardly played a role in the election campaign on the ground, writes David Demes from Taipei. But of course, all candidates have long developed a detailed agenda on how they plan to shape relations with their big neighbor should they win the election.
One thing is clear: Be it Lai, Hou or Ko – all candidates align themselves with public opinion in Taiwan. They may have different approaches, but when it comes to rapprochement with Beijing, none want to push the envelope too far. Instead of a radical change in relations, all of them more or less want to continue maintaining the status quo.
The fact that autocracies and totalitarian regimes are on the rise around the world puts many company executives in a bind: How to make a profit and sleep peacefully at the same time? Caspar Dohmen interviewed business economist Markus Scholz from the Technical University of Dresden, who explains that there can be no more “business as usual” with countries like China.
Companies should no longer pass on their individual responsibility to global institutions. After all, they are often too weak, too slow and simply incompetent when it comes to issues such as AI monitoring. Looking the other way can cause enormous costs, Scholz says. Ethical issues should be part of risk management.
International reporting on Taiwan is mainly dominated by China and cross-strait relations. In the domestic discourse, however, Beijing and the danger of a possible military conflict have hardly been mentioned recently. Instead, the Taiwanese press and the various political camps focussed on real estate scandals aimed at questioning the credibility of the candidates.
During the official TV debates between William Lai (DPP), Hou Yu-ih (KMT) and Ko Wen-je (TPP) on December 30, candidates were confronted with an unusually high number of questions about their strategy concerning future relations with China. In the official election notifications, which were delivered to mailboxes across the island in early January, the issues of national security and cross-strait relations were also at the top of the list of the various election programs.
China.Table has taken a closer look at the election programs and past statements of the candidates regarding their positions on China and a global risk assessment.
Tsai Ing-wen’s former rival, William Lai, has become one of the president’s biggest supporters during his time as vice president over the past four years. His stance on Taiwan’s status and relations with China has also now adapted to the social mainstream.
During his time as mayor of Tainan, Lai described himself as a “pragmatic worker for Taiwanese independence.” During the election campaign, he reinterpreted this term, following the political legacy of his boss, Tsai Ing-wen: Taiwan is already an independent state called the “Republic of China,” Lai said. Therefore, a separate declaration of independence was not necessary. This reinterpretation of his statement preserves its essence and simultaneously defuses it.
During a TV appearance where the candidates were to present their election programs, Lai rejected the criticism of his position and pointed out that, in China’s eyes, all candidates for the presidency stand for Taiwanese independence. “Or are you running for the office of Chief Executive?” he asked his opponents, referring to the title of the head of government of the Chinese Special Administrative Region of Hong Kong.
During the TV debate, Lai also declared that China posed the greatest threat to Taiwan’s survival. Nevertheless, the 64-year-old has repeatedly emphasized that his door will be open for talks with Beijing if he is elected – the only condition: Equal rights and dignity, in other words, a dialogue at eye level.
Whether Xi Jinping’s government will accept Lai’s offer is doubtful. In the run-up to the elections, the Chinese side repeatedly labeled Lai a “troublemaker” and a “destroyer of peace.” During the election campaign, the Chinese Taiwan Affairs Office echoed the KMT’s rhetoric and publicly declared that the people of Taiwan had a choice between peace and war, prosperity and decline.
Lai plans to strengthen the defense capabilities of the Taiwanese military further and continue Tsai’s submarine, ship, and aircraft projects. The plan is to strengthen Taiwan’s economic resilience, secure supply chains, and further reduce its economic dependence on China. Lai accuses the opposition KMT of wanting to return to the path of economic dependence on China.
Former police officer Hou Yu-ih from the KMT likes to present himself as a law-and-order candidate who fights for the security of the Republic of China without a bulletproof vest in a hail of bullets. However, when asked during the debate who the biggest threat to Taiwan’s sovereignty was, he avoided mentioning Beijing by name. Hou favors a renewed rapprochement with the People’s Republic and further economic integration.
Hou’s campaign is led by King Pu-tsung, the closest confidant of former President Ma Ying-jeou, who was in office until 2016. It is, therefore, no surprise that Hou’s China strategy is based on Ma’s principle of “no unification, no independence, no armed conflict.” In his election campaign appearances, however, the focus was often more on his rejection of Taiwanese independence than on rejecting a possible unification with China.
KMT member and Sun Yat-Sen School Director Chang Ya-chung believes that Hou’s political program lacks concrete solutions and is trying to avoid the issue of cross-strait relations. “Ma just kept putting off the issue. The longer it could be put off, the better. Hou is trying to avoid the issue altogether,” says Chang.
Despite the planned rapprochement with China, Hou promises to continue investment in national defense if he wins the election and to increase defense spending to three percent of gross domestic product (currently around 2.4 percent).
Ko rose to prominence during the 2014 Sunflower Movement and was later elected mayor of the capital, Taipei, with the support of many activists and the DPP. There, he had the opportunity to gain experience in dealing with China. At the annual Shanghai-Taipei City Forum, Ko repeatedly declared that Taiwan and China were “part of the same family.”
Kos’ pro-China statements caused the DPP to gradually distance itself from him and finally nominate its own candidate for mayor in 2018. During the election campaign, he also announced his plan to relaunch the trade-in-services agreement with China. A demand that Hou Yu-ih also supports.
Furthermore, he believes Taiwan is not yet ready to join the CPTPP free trade agreement and should instead join the China-dominated RCEP. However, many former activists of the Sunflower Movement, which was founded ten years ago as a reaction to the agreement, see Kos’ plan as a sell-out of their values.
Ko presents himself as willing to compromise and prepared to show goodwill towards China. He has devised the “four mutual” principles for relations with Beijing: mutual recognition, mutual understanding, mutual respect, and mutual cooperation.
Borrowing from US Secretary of State Antony Blinken, he favors working with China where possible and confronting China where necessary. Ko believes the so-called “1992 Consensus” is outdated and says that the Hong Kong version of “one country, two systems” has no supporters in Taiwan. “It is China’s responsibility to develop a new concept,” says Ko.
Although the candidates differ in their rhetoric on China, Taiwan’s future president is unlikely to deviate much from Tsai Ing-wen’s approach to relations with China. Most Taiwanese will not accept a radical change in their government’s China policy.
Should a president Hou or Ko attempt to sign a far-reaching trade agreement with China and, in return, sacrifice some of Taiwan’s sovereignty, the island’s civil society is likely to resist, as it did ten years ago.
What does it mean for responsible corporate behavior when global democracies are in retreat and autocracies are on the rise?
If I want to do business in autocracies and sleep peacefully at the same time, I have to do a lot. Unfortunately, the existing global institutions are too weak, slow and increasingly incompetent to adequately tackle certain issues, such as AI. That’s why we need to talk about the individual responsibility of companies and executives. In my opinion, the old adage “the only social responsibility of business is to increase its profits” is no longer valid in an economically globalized world in which autocracies and totalitarian regimes are on the rise.
Should companies withdraw from autocracies so they can sleep peacefully at night?
This depends on the configuration of the respective autocracy and the issues involved. As a manager of a company, I should think about withdrawing if there are intensive and widespread human rights violations and I have little or no influence on what is happening on the ground and, in the worst case, cannot even protect my own employees or am even forced to collaborate with the regime.
What can companies do?
Some support human rights NGOs in autocracies financially, or by providing information; others sponsor the training of lawyers and judges. Sometimes large companies can influence regimes and improve the human rights situation. This is not necessarily the case in China, but sometimes in countries such as Qatar or in some African states. In principle, large oil and gas companies, in particular, have a lot of influence here. It is problematic when companies behave passively, even though they have the opportunity to fight human rights violations. In such cases, it is, to a certain extent, silent complicity.
Do companies sometimes downplay their influence abroad?
Absolutely. Of course, small and medium-sized companies have no influence in China, but I do see a certain amount of power at larger companies, whether car manufacturers or suppliers. This is all the more true when companies jointly coordinate their behavior, for example via chambers of industry and commerce, and also actively cooperate with the governments at home.
How do you generally rate VW’s activities in China?
The company is obviously trying to become even more Chinese, turning even more strongly to the Chinese sales and production market and ignoring the human rights situation there to a certain extent. From VW’s perspective, I understand that they need this market, especially for the upcoming transformation. But staying in China has political and moral costs.
Several large German companies are heavily dependent on business in China. Can you imagine these companies moving their headquarters to autocratic China at some point and thus switching camps?
No, simply because this step would also be too costly. After all, there are other important markets, such as the American and European markets. Conversely, despite all the decoupling fantasies, I don’t yet see how it would be possible to withdraw completely from China. However, “business as usual” will no longer work there in the medium term. China is becoming increasingly totalitarian under Xi Jinping’s leadership and the human rights situation is becoming more and more dire.
Are there any historical comparisons?
South Africa was also an interesting market for German companies during Apartheid. Back then, they used the same arguments to stay in the market. It was called “constructive engagement” at the time. “We protect our employees. We help constructively in the country.” Change through trade was the maxim. But the Apartheid regime remained in place and only ended once there was a strong political and economic boycott, which was also strongly supported by the business community.
Some German companies are also still active in Russia, such as Metro and Rittersport.
But many others left early. Some were more hesitant and wanted to wait and see. Now many want to leave, but now it’s also a bit too late because the regime has reacted and passed corresponding laws. That makes it more difficult for companies. If they leave, they risk a total loss. That is interesting. It shows that ethical issues should actually be part of risk management. If you disregard the moral dimension, you may have to bear considerable financial consequences later down the line.
Do supply chain laws foster the individual responsibility of companies?
It obviously doesn’t work voluntarily. Naturally, legislators should normally also define the ground rules for the economy. This is exactly what has recently happened with the European Supply Chain Act. Nevertheless, acting responsibly beyond legal compliance remains an important issue for companies. All laws have loopholes. What is crucial is that companies do not exploit these loopholes to circumvent the laws.
Does the capital market allow companies to behave this responsibly?
Companies act very differently. During the pandemic, for example, vaccine manufacturer Pfizer tried to get what it could out of the situation by initiating, or at least not preventing, a bidding war between countries. I don’t consider this to be particularly responsible behavior in a situation where millions of lives had to be saved. Pfizer has a relatively large number of strong, active investors, hedge funds, and so on, who want to force top management to achieve high returns.
On the other hand, there are also listed companies in which owner families still have a strong position and tend to pursue long-term interests. Executives may have greater leeway in such constellations.
So, do investors act differently?
Exactly – we cannot generally say that shareholders do not allow any ethical responsibility on the part of management. There is also a trend towards ESG, i.e., investors focus on social and ecological criteria. But we shouldn’t assume that the segment has excessive influence. There is still a lot of room for improvement.
What will happen if more democracies collapse and authoritarian governments establish themselves in even more countries?
Then, the individual responsibility of companies will be even more important. The situation can tip globally – even in Europe. This happened in Germany in 1933, and things are not looking good in Hungary and Italy either, although the situation is, of course, not comparable to that in Germany in 1933. In the US, Donald Trump may be heading for a second term in office. In such cases, the importance of individual corporate responsibility increases. It is not about mindless activism and certainly not about partisan political engagement on the part of companies. It is about protecting liberal democracy and respecting and protecting human rights.
Markus Scholz has been Professor of Business Administration, in particular Responsible Management, at the Technical University of Dresden since October 2022. His research focuses on strategic sustainability management, sustainable change and innovation, business and human rights, as well as political engagement and corporate political responsibility.
The mascots for the 9th Winter Asian Games in China in 2025 were revealed to the public yesterday. Binbin and Nini are inspired by two little tigers that were born in September 2023 in the Northeast Tiger Forest Park in the host city of Harbin. The official slogan of the games, freely translated by the Xinhua news agency, is: “Dream of Winter, Love among Asia” (冰雪同梦，亚洲同心).
