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About Chile

by: Almiro dos Reis Neto, Associate partner of Hofstede Insights

 

Currency: Chilean Peso (CH$)                                           
Capital: Santiago                                               
Time Zone: UTC – 5:00
 

 

Overview 

 

The Hofstede analysis for Chile is, in general, like its Latin American neighbors. Uncertainty avoidance ranks highest which indicates a high emotional concern for rules, regulations, controls and issues with career security – typically, a society that does not readily accept change and is risk adverse. Individualism ranks lowest which signifies a society of a more collectivist nature and strong relationships where everyone takes responsibility for fellow members of their group.

 


 Chile has a low Individualism (IDV) rank of 23, as do most Latin countries. The score indicates the society is Collectivist as compared to Individualist. This is manifest in a close long-term commitment to the member 'group' (family, extended family, or extended relationships). Loyalty in a collectivist culture over-rides most other societal rules and regulations.  

 

Some cornerstones of the Chilean culture

 

  • Chilean culture has mainly inherited indigenous and Spanish habits, besides other immigrants culture who came later, such as the German in the south;
  • Chilean culture is relational; thus, family and close acquaintances are valued and being introduced through someone is the most common way of getting a job or business opportunities;
  • As in many Latin American countries, people are warm and both greetings and conversations might come along with body touches;
  • The significant Catholic inheritance results on strong beliefs on an “absolute Truth” and the maintenance of traditions;
  • Chile is known for being less bureaucratic, corrupted and more efficiently managed than its neighbor countries;
  • In the business environment people behave and dress formally. Nevertheless, talking about family or unrelated issues are very common, specially to start the conversation.

 

When in Chile

 

  • Titles are important and should be included on business cards. Address a person directly by using his or her title only;
  • Confirming appointments is necessary.;
  • In business, punctuality is appreciated, although not always respected. Regardless, be on time;
  • Have business cards printed with English on one side and Spanish on the other. Present cards to everyone in a meeting except secretaries.
  • Business entertaining generally is done at major hotels and restaurants.
  • Light conversation is usual before business discussions.

 

Greeting

 

  • At the first introduction, a handshake is usual;
  • Handshakes are firms and require eye contact;
  • Hugs are usual greetings within handshakes, specially for closer acquaintances;
  • Opposite genders or women may greet themselves with kiss on their right cheek;
  • It is highly appreciated to speak the proper salutation in Spanish. For example, for good morning, say “Buenos dias”; for good afternoon, “Buenas tardes” and finally “Buenas noches” for good evening;
  • Call people by their title and their last name. Common titles: “Professor” for teachers; Doctor for physicians or Ph.D, “Ingeniero” for engineers, “Arquiteto” for architects and “Abogado” for lawyers;
  • Persons who do not have professional titles should be addressed as Mr., Mrs., or Miss, plus their surnames. In Spanish, these are “Señor” for Mr., “Señora” for Mrs. and “Señorita” for Miss.
  • It is polite to greet the most senior person first.

 

 
Good to know

 

  • Many Chilean executives speak English, but speaking Spanish is appreciated;
  • If you are invited to Chilean house, it is good to bring a gift such as chocolate, wine or flowers;
  • Gifts are not exchanged in a first meeting and they might come along only after a relationship if formed;
  • Lunch time is long, usually two hours;
  • Face to face meeting are preferred rather than phone calls or e-mails, specially concerning new business or important decisions;
  • As a way of expressing their interest, Chileans may interrupt and ask questions or add comments during presentations;
  • Avoid talking about politics, comparison between countries or polemic issues, unless your partner mentions the topic;
  • Chilean literacy level is high (95%) and Chilean culture is highly appreciated by them, specially music and literature (Pablo Neruda is Nobel Prize winner writer);
  • Position in the World Bank Ease of Doing Business Rank (2017): 57 (out of 190 countries); 

 

Body language

 

  • At a meal, keep your hands above the table always;
  • Maintaining eye contact is necessary to show interest and sincerity;
  • Yawns should be stifled or covered with the hand;
  • Slapping your right fist into your left open palm is considered obscene;

 

Dress code

 

  • Men customarily wear dark blue or gray suit, a light shirt, and a conservative tie. Bright colors and flashy fashions are not suitable, nor is wearing anything on the lapel.
  • Women should wear a suit with skirts or trousers and heels. They should also avoid flamboyant colors or excessive jewelry.

 


Key words to describe Chilean culture: 

 

 Family / Friends / Loyalty/ National Culture / Catholic / Spanish colonization / Mapuche indigenous
 

 

 

 

Successful business

 

Doing business in Chile can be challenging because of: 

 

  • The need to develop relationships to enforce trust;
  • Wide range of laws and regulations that must be observed;
  • Communication is not always straightforward and emotional aspects may be mixed within the negotiation process;
  • Many small and medium companies are family run; thus, symbolic and affective aspects may be involved in negotiations;
  • Decisions are usually restricted to top-level managers.

 

Experts Recommendation 

 

  • As in other Latin American countries, look for being introduced to your partner through a third person who can provide you with legitimacy, e.g.: an embassy member, another entrepreneur, a common friend;
  • Look for legal advisory and always write down (e.g.: through e-mails) the agreements and decisions made during meetings;
  • Negotiations and important decisions usually take long. Be patient;
  • Be transparent with both your plans and information – this can lead you to a reliable image;
  • It may cause suspicion if you ask for confidential financial data in the first meeting, especially if it’s a family run business;
  • Aim for top-level managers, at least to start your negotiation, since they are the ones who have the final word.
     

 

 

The Chilean Culture According to the Hofstede Dimensions

 

There is a relevant Power Distance Index in Chile and it may be an inheritance from both the colonial period and specially from the recent dictatorship ruled by Augusto Pinochet from 1973 – 1990. It is worth noting though that this index may be more significant in Chile’s neighbor countries and that politically Chile is known as one of the most democratic and transparent country in Latin America.

 

The expressive importance of group added to the hierarchical trend may lead to paternalistic behaviors inside the family or companies. Especially due to the typical Latin “machismo”, women may still face slight more difficulties to achieve power positions, although once more Chile seems to be in advantage towards its neighbors.

 

Chile's highest Hofstede Dimension is Uncertainty Avoidance (UAI) at 86, indicating the society’s low level of tolerance for uncertainty. To minimize or reduce this level of uncertainty, strict rules, laws, policies, and regulations are adopted and implemented. The goal of this population is to control everything to eliminate or avoid the unexpected. Because of this high Uncertainty Avoidance characteristic, the society does not readily accept change and is very risk adverse.  This is in accordance with low Long Term Orientation that leads to short term controlled movements rather than long perspectives.

 

Finally, the low level of Masculinity assembles with the high level of Indulgence in the sense of pointing out a preference towards life quality, enjoyment, celebration and the role of work as a mean and not as an end for performance.

 

For a more detailed analysis on the Cultural Dimensions of Chile, and how it compares to other countries, visit the Country Comparison tool.
 

 

Interesting Links

 

  1.  PWC report on Doing Business at Chile concerning financial aspects, investor profile, ease of foreigner business and related issues: https://www.pwc.com/cl/es/publicaciones/assets/doingbusiness.pdf
  2. Great summarized article on Chilean Culture and History: http://www.kwintessential.co.uk/resources/guides/guide-chile-etiquette-c...
  3. Official government link about Chile’s Geography, cultural legacy, History, famous touristic landscapes and other facts: http://www.chileculture.org
  4. Video channel with several videos showing famous landscapes and cultural aspects: https://www.youtube.com/user/SantiagoAdventures1/videos
  5. Short video on Chile’s History specially concerning the colonial time: https://www.youtube.com/watch?v=Tjw6hlJEq5M
  6. Video on Chile vs. Peru conflicts: https://www.youtube.com/watch?v=xQpaUCm_3Ig
  7. Official government video for foreigners investors: https://www.youtube.com/watch?v=jRiCryAH9cI