Of the myriad ways in which technology is reshaping legal systems across the globe, perhaps none is more focused or comprehensive than the Corporate Social Credit System (“CSCS”) now being built by the People’s Republic of China. The CSCS is a technology-based data collection tool that enables the Chinese government to amass a large amount of data in order to assign scores to corporations for governance purposes.  In theory, the CSCS will measure how well a company complies with the law in China and will provide for rewards (in the case of high social credit scores) and for sanctions (in the case of low social credit scores).  The significance of the CSCS’s emergence is underscored by China’s pivotal role in the global economy and its importance to numerous U.S. firms, especially as the CSCS extends its reach internationally via the Belt and Road Initiative. This qualitative study, grounded in interviews and a substantial review of a large number of Chinese-language primary sources, aims to achieve several objectives: first, to present a comprehensive analysis that reveals the CSCS’s structure to English-speaking audiences; second, to examine how the CSCS has altered the role of corporate counsel in guiding their clients; and third, to explore how the CSCS influences legal risk management and value creation for Western businesses operating in China.

(Declaration of Interests: This research is partly funded by the Law Library of Congress’s Daniel and Florence Guggenheim Scholars Program)

Carrie Shu Shang is an Assistant Professor of Business Law at California State Polytechnic University, Pomona. She received her J.D. from University of Southern California School of Law, and her B.A./B.S. (with High Honors) from University of California, Berkeley. She’s interested in how geopolitics is shaping and reshaping international law and global business compliance. Some of her recent works were placed in notable international law journals such as the Journal of International Economic Law, Journal of World Trade and Leiden Journal of International Law. Prior to joining the academia in the U.S., she was the Chief Representative of Hong Kong International Arbitration (HKIAC)’s PRC Office, and the director of the common law program at Shanghai University of Finance and Economics School of Law.  She has practiced litigation and arbitration with local and international firms. She’s currently an active neutral and a director of the Silicon Valley Arbitration and Mediation Center (SVAMC). She’s admitted to practice in California, New York and is qualified to practice law in the People’s Republic of China.

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