Pampered 2d generation of China's entrepreneurs packs a course in values

Luo Yu, 31, who has taken the Jiaye Changqing class, said that in his youth he didn't appreciate the importance of a family business. Now, he is general manager of the machinery company. (Maureen Fan/Washington Post)

CIXI, China - In a borrowed classroom of the provincial Communist Party School, a newly busy philosophy professor addressed 15 well-groomed adult students. His message: Try to have a soul.

"In China, if you are only rich, people will not respect you," said Zhang Yinghang of Zhejiang University, a professor increasingly in demand on the lecture circuit. "You also need good manners, an outgoing personality, and good morals. This is what rich children in China lack."

It was opening day of Jiaye Changqing, or Family Enterprise Lasts Forever, a weeklong course for the sons and daughters of rich entrepreneurs - especially those sons and daughters who are about to inherit the family business. While the course included standard lessons on management strategy, it was also intended to instill traditional Chinese values in a younger generation schooled in Western, capitalist ways.

In other words, there's more to life than making money.

"The school exists partly because of the only-child syndrome, where little emperors and princes were brought up with everything within their sights," said Luo Yu, 31, a graduate of the class in Cixi who runs his father's factory, which makes $50 million a year selling valves, pumps, and gear boxes to the United States. "They've never shared anything with anyone else."

Once ridiculed and looked down on, entrepreneurs are now among China's elite. Along the way to wealth, however, many have neglected to show their children what they consider the proper way to behave. Now that they want to make sure their offspring are fit to take charge, courses such as Jiaye Changqing are growing popular.

Like many newly rich Chinese, the parents of the students at Jiaye Changqing have worked hard and relied on friends and relatives as business contacts. They have also ridden a wave of economic policy change that over the past 20 years has transformed China.

Their children are better educated but unaccustomed to hardship. They spend money freely and return home from studying abroad with strange ideas such as networking with outsiders. Half the students in the course have studied abroad, including one woman who has jetted back and forth to China since age 7 and understood only part of Zhang's lecture.

"Entrepreneurs are leading where society is going, and if this group doesn't understand Chinese culture, it will be very bad for society," Zhang said. "People will be less and less happy, even though they have more and more money."

The founder of Jiaye Changqing, an entrepreneur himself, saw this firsthand.

In crisscrossing China to tell his own success story, Mao Lixiang frequently met tearful parents who didn't know what to do with their children. One son from Anhui Province didn't want to study. The scion of a family in Zhejiang province wanted only the best clothes and the fastest cars. Other children simply weren't interested in inheriting their parents' businesses, even though most Chinese who work in the private sector do so for family-controlled companies.

"The badly behaved children don't make up a huge number, but their influence is great and it gives rich people a bad image," said Mao, 67, who began his career as an impoverished, "barefoot" teacher with a high school education. He is now board chairman of Ningbo Fotile Kitchenware, a $178 million appliance company.

Mao made his fortune selling lighters and gave his first company to his daughter. He handed off his appliance company to his son. Now his focus is the school, which he hopes to expand to teach parents and their children.

"Blood is thicker than water. Most Chinese hope their legacy will live on through their children's lives and careers. Every entrepreneur dreams this," said Chen Ling, an economics professor at Zhejiang University, which offers a training course for family-run businesses.

Luo Yu, for one, didn't share the family dream. His father started the Cixi Huili Machinery & Electric Co. in Zhejiang province with 30 people in 1988. The $50 million company now has 1,100 employees.

"When I graduated from university, I had plenty of my own very good ideas," said Luo, 31 and general manager of the company. "I was very farsighted. In 1996, I noticed Cixi didn't have a good florist shop. In 1997, no Internet cafe. In 1999, no coffee bar. All of these things had potential, but my father did not agree."

Gradually, Luo said, he saw his father's sacrifices and understood the importance of a family business.