Korean business culture and etiquette

The 2015 Australian International Business Survey (AIBS) identified that local language, culture, and business practicalities as the largest single barrier to conducting business in Korea for Australian businesses. For this reason, it is crucial to understand some fundamental Korean cultural practices within the business context. Korean culture is steeped in Confucianism, which emphasises respect for education, authority, and age. Although modern Koreans may not adhere to Confucian principles as rigidly as previous generations, these principles continue to underpin many customs and business practices.

Age and status

Respect for age and status are very important in Korean culture, with hierarchy affecting all aspects of social interactions. Everyone has a role in society as a result of hierarchy - therefore it is vital to respect it. Koreans are most comfortable interacting with someone they consider their equal. Status is largely determined by someone’s role in an organisation, which organisation they work for, which university they went to and their marital status.

Business cards

The exchange of business cards is an essential part of initial meetings. It allows Koreans to quickly determine their counterpart’s all-important position, title and rank. While still standing, you should politely hand
 a business card over with two hands, and receive one in return. Do not simply drop the card into a pocket; instead take a few seconds to review names and titles. If you are sitting down, place it on the table in front of you for the duration of the meeting.

Gift giving

In Korea, the importance of a relationship can be expressed through gift giving which is always welcomed. Note though, it is inconsiderate to give someone an expensive gift if you know that they cannot afford to reciprocate accordingly. Gifts should always be wrapped nicely in red or yellow paper, as these are royal colours. Alternatively, you can use colours that represent happiness: yellow or pink. Never sign a card in red ink or use green, white or black wrapping paper. If you’re invited to a Korean’s home then you should take gifts such as fruit, good quality chocolates or flowers and present the gift with two hands. Gifts are not opened when received and will be done so later.

Korean names

Korean family names are mostly of one syllable, while given names tend to have two. The family name comes first (Kim Tae-Woo, for example). Until you are on very good terms with a Korean counterpart, it is best to use the family name preceded by an honorific (such as Mr), whether speaking directly to them or about them to another Korean. In settings that call for great respect or formality, you should use your counterpart’s formal title and surname (Chairman Lee, for example). Some Koreans who have lived overseas may have adopted a Western first name, and prefer that it is used over their family name. Some also view their name as a very personal thing, so a suggestion to work on a first-name basis may be slow to be offered.

Bowing and handshakes

Koreans bow to those senior
 to them both as a greeting and a show of respect. The junior person initiates the bow, bending from the waist
 to an angle of between 30 and 45 degrees from vertical. A less accentuated bow is returned as acknowledgment from the more senior person. Bowing in Korea is not as pronounced as in other countries, such as Japan. Greet the highest status individual first, followed by the oldest when meeting a group of Koreans. The individual with the highest status usually enters a room first. For Australian business people, extending a simple handshake when greeting and taking leave is fine; just don’t be surprised by a two-handed handshake and a bow during the course of an initial meeting.

Building relationships

Building relationships is an essential part of doing business in Korea. Relationships are developed through informal social gatherings and generally involve a considerable amount of eating and drinking. Such gatherings also present the opportunity for both sides to discuss business in more relaxed and friendly surroundings, including over dinner.

Dress code

Appearance is very important, and Koreans tend to dress more formally than Australians. Business attire is conservative, with an emphasis on conformity rather than individual expression. Men should wear dark-coloured business suits with ties and white shirts. Jewelry for men should be kept to a minimum – a watch and a wedding ring would be fine. Women should also dress conservatively and in subdued colours.

Gender equality

Although gender equality is increasing, men still dominate the Korean workplace. It is expected businesswomen act in a manner that is considered refined and ‘feminine’.

Don’t be too pushy

Korean business people are good negotiators so be patient and gentle, but firm. Also ensure you are as dignified as possible and don’t push too hard. Expect a ‘price war’ but don’t give in easily, as Koreans are persistent and admire this quality in others.

Geopolitical sensitivities

Korea and Japan dispute the territorial sovereignty of several islands in the sea between the two countries. These include the small islets called Dokdo in Korea and are known as Takeshima in Japan. 
As discussed earlier, the two countries refer differently 
to the sea surrounding these islands. To maintain good business relationships with Korean stakeholders, it is 
wise to respect local cultures and preferences, including by ensuring you use local and appropriately referenced versions of any geographical materials (such as maps that might be used in a presentation to a Korean audience). Not observing such delicate affairs can cause insult and may lead to business relationships ceasing.

Maintaining face

As in other Asian societies, maintaining face is central to the way business and social relationships work. Through their social etiquette and behaviour, Koreans aim to preserve a harmonious environment in which a person’s kibun (their mood or inner feelings) can remain balanced. The best way to handle kibun is not to demand yes or no answers and to accept the need for slow consensual decision-making. Contradicting someone openly, criticising them in front of someone else or patronising them are sure ways to lose business. It is more advisable to give sincere compliments, show respect or do something that raises self-esteem.

Dining

A great deal of relationship building takes place in bars and restaurants. Always accept dinner invitations as this is the Korean’s opportunity to assess your trustworthiness and whether they wish to conduct business with you.

Dinner is the largest meal of the day and normally occurs between 7pm and 9pm. While it is common in other countries to extend dinner invitations to spouses, this is not the case in Korea; business entertaining tends to be reserved for the people directly involved. It is customary for the host to order the food, which all arrives at the same time. Korean food can be extremely spicy but milder dishes are also available. Wait until the host invites you to start. Do not leave chopsticks sticking into the rice bowl - place them by the side of your place setting on the chopstick rests when not in use. Use only the right hand when passing food around the table. The host is expected to pay for the meal; nevertheless, a good-natured argument over who will pay is to be expected. It is also polite for the foreigner to offer a reciprocal dinner invitation.

Some other aspects of dinner etiquette to note:

• Koreans generally prefer to concentrate on their food while eating, and to talk after the meal is finished over coffee or tea
• Unless your hosts raises it first, avoid discussing business during a meal
• Ensure you don’t serve yourself or eat before the host initiates it
• Always put food taken from a serving dish onto your plate or bowl before eating it
• Although chopsticks are the most predominantly used utensils (as well as spoons for soups and noodles), you may ask for forks or knives when dining in larger cities
• Never pick up any food with your fingers. Fruit is eaten in slices with forks.

Want to learn more? Explore our other South Korea information categories or download the Korea Country Starter Pack.