Lying in Chinese
Bill Dodson @ This is China! has a great series on the specific characteristics of lying in China. This has got to be one of the most frustrating aspects of working in China. It sometimes feels like everyone is lying to you - either out of sympathy, protection or deliberately with malicious intent - and it's not always easy to sort out which is which.
Working with suppliers this can be of particular annoyance because you're not quite sure what to believe - especially when goods aren't being produced on time or attempt to pass a large price increase down to you. Suppliers can come up with the most fantastical stories - but fortunately as Dodson notes, most of them aren't particularly clever about their lies that are easily resolved with better information. Of course, once you have that information and you know someone is lying, it's another issue altogether as "face" is truly a big thing and you don't want to antagonize anyone to the breaking point because you really don't know what might happen especially depending on who you're dealing with (seriously).
An employee of mine told a big lie. He did it in the attempt of hiding something that was no fault of his own but that he hoped to correct quickly and easily on his own (sorry about being vague). I can't say that I was particularly proud of myself afterwards, but I entirely blew up and publicly berated him over what I saw as a betrayal (apparently a standard western response as Dodson later points out. On the other hand, if culture is the result of both what is said, and what is not said, while I think what I did was directionally correct, the execution could have used some work. In that respect, I guess I'm somewhat fortunate in that we're a fairly young company and are able to correct some bad habits.
The implications of lying however, are somewhat far reaching - and I would argue, extend to such things as corruption (here, some are absolutely brazen in the lies they tell to coverup self dealings) and more likely than not, to financial reporting. This, I think, does not bode well for the stability of the securities industry that hasn't gone in many directions other than up in recent years.
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