Push and pull raise sustainability on China Inc agenda

December 09, 2011
China going green

New research shows that Chinese companies are becoming more interested in sustainability issues. Pressure from government and a recognition of how brands gain value from sustainability policies are two factors contributing to the growing interest.

The Conference Board, a US-based research and business membership group, surveyed 476 firms for its Business and Sustainability in China: Company Responses to a National Priority report, which discovered that government directives, at both local and central levels, are often a decisive factor in defining corporate sustainability strategies.

The report says an encouraging development is that Chinese companies are looking at sustainability in the broadest way, also encompassing corporate governance and welfare issues. On the downside, companies still say cost issues remain the biggest barrier to sustainability programs.

Last month, accountancy firm KPMG released a report looking at corporate governance globally and while Asia was found to be lagging the rest of the world, China was fast-catching up.

“[China] seems to be in a full-out sprint to catch up to the traditional leaders in this field. Almost 60 percent of China’s largest companies already report on corporate responsibility metrics, bringing the country on par with where Spain, Italy and the Netherlands were just three years ago,” the KMPG survey reported.

While the uptake of sustainability issues is taking hold, The Conference Board's new report says that a shortage of experience in implementing programs and helping companies identify costs and benefits.

David Vidal, director of The Conference Board Center for Sustainability and one of the co-authors of the report, said: “How China continues to grow its economy in a more environmentally and socially responsible way is an issue of concern wherever China has an economic impact and, today, that is almost everywhere. It is a touchstone for further discussion, debate, and collaboration.”