Foreign Firms Face Scrutiny in Chinese Media

Foreign Firms Face Scrutiny in Chinese Media

by Wenxiong Zhang

Since it opened its first restaurant in China in 1990, the American chain KFC has blanketed the country with thousands of outlets that offer Western-style fried chicken, hamburgers, and fries. While in the U.S. KFC symbolizes speedy, inexpensive food, in China it’s a symbol of quality. “Being able to dine in KFC once a month was a pride of my childhood,” said Wanqing He, a New York University student from Xinjiang. “It is still some kind of high-end restaurant in my hometown to average income families.”

But the aura of quality has faded fast in recent months, ever since China Economic Net, a government-owned online publication, published a November story revealing that a Chinese KFC supplier used banned antibiotics and hormones to raise its chickens.

The report set off a huge wave of criticism of KFC on weibo, the Chinese version of Twitter. Then, in December, state-run China Central Television (CCTV) joined the critics, and the story accelerated.

In the CCTV story, reporter Yun Zhang reprimanded Yum Brands, KFC’s corporate owner. “Yum reaches a large group of consumers who trust in its food quality,” said Zhang, who challenged the company to “offer clear information about the number and consumption of these chickens. It has to give the public a satisfactory answer.”

The story was an unusual one – a relatively rare example of investigative journalism by CCTV, and even more attention-getting because the target was a foreign company. In fact, the KFC report may have signaled a shift in media rules in China: Foreign companies are now fair game for criticism and investigation. Apple learned that when it was compelled to apologize this month over criticism of its customer service policies.

The CCTV report on KFC, 15 minutes long, offered strong visuals. Tight video shots showed listless chickens, who spend 45 days from birth to slaughter, growing in overcrowded coops filled with waste. The CCTV reporter asked one farm worker if he would ever eat the meat he helped produce. No, came the answer. “Even the flies won’t come to this place, because it’s toxic.”

After that report, KFC, which earned 44 percent of its global revenues in China last year, saw sales in the country plummet by 24 percent in January and February. Bad feelings persist. One recent post on Weibo said, “I hope companies like KFC that sells these garbage foods will go bankrupt soon.”

But while foreign companies take a lashing, domestic enterprises are still far less likely to get investigative scrutiny in social or mainstream media.

According to an analysis by the Chinese news website, domestic food companies were not featured in any of the special Consumer Rights Day programs for the past three years in China, while McDonald’s and Carrefour were both criticized for food safety lapses. Another online site, China Food, reported that Chinese media exposed food scandals at 30 companies last year – nearly a third of them foreign firms, including KFC, McDonalds, Starbucks, Heinz, Nestle and Coca Cola. An editor at China Food, who declined to be identified, said Chinese media clearly feel freer to criticize foreign companies. “They have less concern when they deal with foreign companies because the companies are less connected with the government,” said the editor.

How CCTV reacted to another food safety scandal, this one involving domestic wine producer, Maotai, illustrates the different standard that appears to apply when media report on Chinese enterprises.

In December, a Weibo user posted a quality report, done by an independent company in Hong Kong, stating that toxic ingredients had been found in Maotai, a high-end wine often served at banquets for top officials. Mainstream domestic media largely ignored the independent assessment, but instead aired the accusations of a Maotai executive, who charged that the reports were a smear campaign instigated by competitors. The account of the Weibo user who posted the Hong Kong report was later suspended.

Jason Lee, a reporter from China Daily in Beijing, said that the mainstream media’s softer treatment for domestic firms was probably due to self-censorship, rather than any specific government order. But he said that the increasingly popular Weibo platform creates pressure on China’s state-owned media, particularly when it comes to reporting on foreign companies.

“People on social media would blame the problems of domestic companies on the lack of government regulations,” said Lee. “But they don’t make that kind of excuses for foreign companies.”

Wenxiong Zhang studied international affairs and English literature at China Foreign Affairs University in Beijing. He is currently a graduate student at Columbia Journalism School in New York, where he reports about China and Chinese immigrants in New York City. He contributed this article to CDT.

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