The United States government and many other governments across the globe see the importance in protecting international environmental concerns. When US companies expand abroad, incentives and regulations attempt to prevent environmental abuse. Corporate social responsibility is a priority for companies hoping to please investors and customers.
An issue companies face when trying to improve environmental corporate governance is that many times environmental integrity is not profitable. Chinese companies specifically have had a reputation for setting aside environmental concerns in the pursuit of profits. The smog that plagues China is not a secret. Chinese Communist Party leaders are finally reacting to public pressure to rebalance priorities and reduce air pollution however.
The Chinese State Council issued an Action Plan on Prevention and Control of Air Pollution in 2013. The Plan, “serves as the guidance for national efforts to prevent and control air pollution for the present and the near future.” Many provinces have followed in the National Plan’s footsteps. The most polluted province in China is Hebei and this past 2013 year, thirty five factories were closed in Pingshan County, Hebei. The closure of these cement factories lead to 3,780 layoffs and subsequently a hit to the economy.
In order for a plan like this to work, it is important to adjust incentives. The Chinese Cabinet seems to recognize this and is offering 1.6 billion dollars in funding to incentivize the prevention and control of air pollution.
Will China’s new focus on environmental recovery provide a positive effect on the country? How will thousands of job losses be recovered? Is it too little too late? Should countries continue to have sovereignty over the environmental hazards in their own territories? Don’t air and water pollutants effect the globe as a whole and not just the country in which it originates?
The National People’s Congress of the People’s Republic of China http://www.npc.gov.cn/englishnpc/news/
Ministry of Environmental Protection: People’s Republic of China http://english.mep.gov.cn/News_service/infocus/201309/t20130924_260707.htm