Getting Down to Business: Deepening Environmental Transparency in China

Ker, M. (2014). Getting Down to Business: Deepening Environmental Transparency in China. Solutions 5(4): 40-50. https://thesolutionsjournal.com/article/getting-down-to-business-deepening-environmental-transparency-in-china/

Feature

Getting Down to Business: Deepening Environmental Transparency in China

by Michelle Ker Lei Han / CC BY-NC-ND 2.0

Tiananmen Square in Beijing cloaked in smog.

In Brief Large-scale reductions in emissions must be realized in order to address China’s formidable pollution problems. To that end, in addition to strengthening enforcement, the government needs to incentivize companies to reduce their emissions, and decision-makers need to be able to identify key sources of emissions and encourage public monitoring of pollution sources by opening access to environmental information. The establishment of a national Pollutant Release and Transfer Register system—an environmental database to collect and disseminate information on environmental releases and transfers of conventional and toxic pollutants from industrial facilities—could help improve the implementation of China’s environmental policies, and would be a meaningful step to encourage companies to reduce their emissions.

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series of high-profile environmental disasters in 2013, including northern China’s winter “airpocalypse” and the discovery of thousands of dead pigs littering Shanghai’s main water source, have indelibly illustrated the stakes of not enacting stronger environmental policies. In recent years, the Chinese government’s policies have started to reflect the need to balance economic growth with environmental sustainability. As part of this policy shift, in 2008, China’s Ministry of Environmental Protection (MEP) issued a set of measures that require government agencies to disclose a wide range of environmental information, in response to the State Council’s Open Government Information Regulations.

Despite the gradual progress made in government disclosure, environmental information from Chinese companies has, until very recently, remained in a black box. Over the last year, developments in Chinese laws and regulations, including pathbreaking amendments to China’s bedrock Environmental Protection Law, support for environmental transparency in policy statements from China’s new leaders, unprecedented public awareness of environmental issues, and best practices already underway in various Chinese cities, have enlarged the space for deepening environmental transparency in China. The establishment of a national Pollutant Release and Transfer Register (PRTR) system, building upon a pilot PRTR project currently underway in Tianjin, could help improve the implementation of China’s environmental policies, and would be a meaningful step to encourage companies to reduce their emissions.

Historical Context In the mid-1980s, informal disclosure of information related to public affairs emerged first at the village and then at the enterprise level as a consequence of economic reforms. Guangzhou became the first city to come out

with official provisions on open government information in 2003, and several major cities soon followed suit.

These rules and regulations served as the main legal basis for disclosure of government information by local governments until 2008, when the central government enacted China’s first national regulations on open government information.1 The State Council’s Open Government Information Regulations, enacted in 2007, require state administrative agencies to proactively release information related to their work and allow citizens to request information.

Key Concepts • New laws and regulations with potentially game-changing provisions for environmental information disclosure present significant opportunities for deepening environmental transparency.

• In contrast with the gradual progress made in government disclosure of environmental information, corporate environmental information disclosure has been extremely limited.

• China’s next step should be to formalize corporate disclosure of pollutant releases and transfers through establishing a national Pollutant Release and Transfer Register system.

The regulations—a milestone for a country not known for a tradition of transparency—were motivated by a growing recognition that transparency can benefit economic development and improve government performance.

Since 2003, China has passed a series of environmental laws and regulations that incorporate a variety of environmental information disclosure requirements. One of the earliest was the 2003 Cleaner Production Promotion Law, which requires heavily polluting enterprises to disclose information about emissions and other environmental data. The 2003 Environmental

Impact Assessment (EIA) Law and the related 2006 Measures on Public Participation in EIA required partial public disclosure of EIA documents.

In 2005, a key State Council document setting forth guiding principles on environmental protection stressed the importance of information disclosure, public supervisory mechanisms, and the disclosure of enterprise violations of environmental standards.2 As the most active agency in pushing for greater disclosures, MEP was the first and only ministry to operationalize the Open Government Information Regulations, enacting the Measures on Open Environmental Information on May 2008. Yeling Tan, a global governance scholar at the Harvard Kennedy School, argues that these open environmental information measures are unique in several ways. First, the burden of disclosure in China lies with government rather than industry. Only enterprises that have exceeded pollution standards are required to disclose their emissions. Second, the measures hold less weight than law. Under China’s legal framework, the State Secrets Law and Archives Law both have higher status, causing uncertainty on the official level as to whether the disclosure of certain information might be in violation of the State Secrets Law or Archives Law. In practice, this confusion has allowed officials some degree of discretion on disclosure. Third, “the measures are technocratically designed to improve governance outcomes rather than to support a ‘right to know’, such as the U.S.’s Toxics Release Inventory, which is based on Freedom of Information Act.”3

How We Got To Where We Are Today As China’s increasingly prosperous and middle-class society has become more aware of environmental issues, it has demanded stronger government action on environmental protection, and has called for greater participation and government transparency. In a 2013 survey

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conducted by Shanghai Jiao Tong University, 80 percent of respondents stated that the government should prioritize environmental protection over economic development, and over 60 percent said that government information about environmental protection is not transparent.4 Lacking an effective institutional mechanism through which they can participate in the environmental policy-making process or, until recently, seek redress through the legal system, citizens have turned to protest—online, and increasingly, offline—to make their grievances heard.5 A flurry of environmental incidents in recent years have pushed up public engagement in environmental issues.

The greatest headway has been made with public mobilization over urban air pollution. Since 2011, haze and smog have cloaked wide swaths of China for long periods of time, negatively affecting the health and quality of life of millions of residents. A particularly toxic few weeks during the winter of 2011–2012 spurred millions of city-dwellers to take to the internet to express outrage at the environmental conditions of their cities. But much of the outrage came from the lack of government transparency about the pollution—government statistics not only excluded data on key pollutants, but also claimed that air quality was continuously improving, which was easily belied by observation and experience. Alternative data streams, most notably from the U.S. Embassy, contributed to growing public distrust.

In response to widespread public criticism, the government reversed course.

By the end of January 2012, Beijing began to track and publicly report ambient levels of PM 2.5, fine airborne particles believed to pose the greatest health risks, and decreed that some 30 major cities would begin monitoring PM 2.5, followed by 80 more in 2013, and most other cities by 2015. By March 2012, the State Council announced revised national air quality rules—along

1010global.org / CC BY-NC-SA 2.0

Recent years have seen increased public engagement in environmental issues across China. Here, an event organized by the China Youth Climate Action Network.

with mandatory PM2.5 data and ozone measurements, standards would be tightened to be more in line with the World Health Organization’s recommended levels.6 It was a milestone of sorts: public mobilization online had reached the highest levels of government and triggered concrete changes in national policy. But success with public mobilization on air pollution has not translated into success with less visible but no less damaging types of pollution, such as soil pollution.

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While some environmental concerns have been channeled online, in many cases, it is not enough. Environmental protests—generally stemming from citizens’ concerns over the potential for adverse health impacts and depreciation of property value that environmental degradation and environmentally risky projects pose7—are fast becoming one of the biggest forms of social unrest in China, growing, by one estimate, an average of 29 percent annually from 1996 to 2011, and by 120 percent from

2010 to 2011.8 Last summer saw the eruption of large-scale environmental protests: in Kunming, over plans to build a China National Petroleum Corporation (CNPC) oil refinery and paraxylene (PX) project; in Shanghai, against plans for a lithium battery factory; and in Ningbo over work on an oil and petrochemical complex. Just this May, a similar large-scale protest took place in Hangzhou against a planned waste incinerator. Such protests, particularly when there is potential for the protest to turn violent or to spread from one city to another, pose a significant threat to social stability.

The severity of ongoing environmental degradation in China and its impact on social stability has led the central government, which has traditionally placed limited value on transparency, to view environmental transparency as a necessary policy tool for improving environmental outcomes through: (i) strengthening its capacity to monitor local governments and polluting enterprises; (ii) enabling non-state actors to monitor and exert pressure on local governments and polluting enterprises, and (iii) and improving channels for citizen participation.9 This shift can be seen in public calls by Premier Li Keqiang for the proactive disclosure of environmental pollution information in a “transparent” and “timely” manner and a recent circular from the State Council asking government officials to release information in an “active, timely, comprehensive, and accurate manner.”10 Moreover, the central government and increasingly, some local governments, view the disclosure of environmental information as being key to improving public trust in government information and as one environmental protection official put it, “reconciling differences between the public, enterprises and the state.”11 This mentality shift, however, will take time to take root and spread.

Local environmental protection officials have traditionally viewed

information disclosure as thankless work that only adds on to their already full plates, and have limited disclosure for a variety of reasons (e.g., for fear of undermining social stability, negatively affecting economic development, or generating bad press).

But with the increasing frequency of environmental protests, where grievances are often as much about the lack of transparency as the pollution itself, environmental officials have learned that the timely disclosure of information can help mitigate citizen concerns at an early stage.12

environmental protection bureau (EPB) enforcement campaigns, clean production audit information, enterprise environmental performance ratings, disposition of petitions and complaints, environmental impact assessment reports and project completion approvals, discharge fee data, and responses to public information request. Out of a possible 100 points, basic compliance with the regulations earns 60 points.13 The 2009 assessment, made one year after China’s national open government information regulations

Last year, Ningbo began requiring companies to disclose their own pollution data—a first in China.

What the Data Tell Us How has implementation of China’s open environmental information regulations played out?

The Pollution Information and Transparency Index (PITI), a ranking of open environmental information amongst 113 Chinese cities, offers perhaps the most comprehensive independent assessment to date. Since 2009, the Natural Resources Defense Council and the Institute of Public & Environmental Affairs (IPE) have produced the PITI on an annual basis. The PITI assesses government disclosure of environmental information at the municipal level. It does not cover disclosure at the provincial and national level nor does it cover corporate information disclosure. Another limitation is that the PITI, along with other existing studies, covers the availability and access, but not the quality of the environmental information disclosed.

The PITI assesses cities’ performance implementing open environmental information regulations across eight categories: records of enterprise violations, results of

came into effect, found that overall implementation of environmental information disclosure was relatively low. Only four cities received more than the minimum compliance level of 60 points. Thirty-two received fewer than 20 points, and the average score of all 113 cities was just over 31 points.13 The 2012 assessment found that the average PITI score continued to rise, reaching 42.73 points, with 20 cities scoring above 60 points.

However, the assessment also saw the largest number of cities (35 percent) with decreasing PITI scores over of the previous three years.14 Overall, PITI scores since 2009 show a very uneven performance across the country, as well as significant fluctuations in city scores, highlighting the challenges of policy implementation in China.

Uneven Performance of Chinese Cities The main challenge to implementing policies in China stems from its decentralized governance system.

National environmental policies are

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Jonathan Kos-Read / CC BY-ND 2.0

View of the city of Anchang in Sichuan province, a region with some of the highest levels of pollution in China.

drafted in Beijing and implemented by subnational governments that may have competing goals, such as economic growth. The main burden of implementing the open environmental information measures falls on the EPB within each local government. EPBs receive their policy directives from the MEP, but local governments control EPB resources as well as personnel promotion decisions. The open environmental information measures require that EPBs disclose information on enterprises that have violated pollution standards. However, economic growth remains an overriding priority for most localities, leading local government incentives to be closely aligned with those of industry. This close relationship translates into poorer bargaining power for EPBs in relation to enterprises. 15 Thus, local government objectives—specifically, the degree to

which the local government values maximizing growth vs. balancing growth with environmental sustainability—as well as state-enterprise relations strongly affect the implementation of the open environmental information measures. Based on PITI data, scholars Lorentzen, Landrey, and Yasuda and Tan both find that “Chinese cities dominated by large industrial firms are less transparent than those with a less-concentrated industrial base,” and “the negative effect on environmental transparency is stronger when the city’s largest firm is in a highly polluting industry.”16 PITI scores have shown gradual improvement among municipal governments in economically advanced regions, such as the Pearl River Delta and the Yangtze basin. Ningbo, a city in Zhejiang Province, has led the PITI rankings for all four years, receiving high marks for disclosing enterprise

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violation records (a rarity among its peers), for the disposition of verified petitions and complaints, and for being responsive to public information requests. Last year, Ningbo began requiring companies to disclose their own pollution data—a first in China. Best practices by other high performing cities include publishing real-time online monitoring data, publishing emissions violation data, citizen petitions, and complaints information; and regularly publishing data on enterprise emissions.17 However, the open environmental information measures have failed to improve transparency in the most polluted cities, which is precisely where they are most needed. Indeed, cities in provinces with high levels of pollution, such as Shandong, Inner Mongolia, Sichuan, Henan, and Hunan, have made little progress or even regressed.18

Uneven Disclosure with Different Types of Information Beyond the large variation in performance changes across cities, changes in government disclosure have also depended on the types of information being released. The Measures on Open Environmental Information distinguishes between “government environmental information” and “enterprise environmental information,” with the former defined as “information made or obtained by environmental protection departments in the course of exercising their environmental responsibilities” and the latter as “information recorded or stored by enterprises relating to environmental impact arising from enterprise operational activities and enterprise environmental behavior” As a general rule of thumb, EPBs maintain relatively adequate information on policy documents, basic environmental quality, environmental news and announcements, and the environmental agency itself, but are less forthcoming with complex and sensitive information, such as environmental supervision, emissions data, EIA outcomes, accidents and emergency responses.19 In 2010, the types of environmental information with the largest percentage increase in average scores relate both to public appeals (disposition of verified petitions and complaints [8.63%] and responses to public information requests [14.01%]).

In 2011, the information types with the largest score increases relate to government performance (fees imposed and collected on pollution discharge [11.55%] and clean production audit [8.58%]).20 Unfortunately, the types of information with which environmental authorities have been least forthcoming happen to include the most critical kinds of environmental information: disclosure of enterprise emissions data, enterprise supervision records, and EIA information.

In industrialized countries, it is

common practice to make mandatory the disclosure of the categories and amounts of hazardous substances discharged to the environment on a regular basis. Routine enterprise supervision information—including enterprises’ violations of emission standards, violation of total emission control targets, and records of administrative penalties—are crucial for determining whether an enterprise has been in compliance with environmental regulations. EIAs, which identify potential environmental impacts from proposed development actions, are important for facilitating informed decision-making and sound environmental management. In these three areas, most cities have made no substantive progress since 2008.

Particularly troubling is the finding from the 2012 PITI assessment that “none of the cities surveyed made entire EIA reports public, nor were there any EIA hearings that invited the public to participate.”21

China’s Next Step: Formalizing Corporate Disclosure of Pollutant Releases

Measures on Open Environmental Information (2008) •• Lays out the scope of governmental environmental information disclosure, listing seventeen items of environmental information EPBs must disclose to the public “on [their] own initiative.”

•• These items can be clustered into four major categories: environmental laws and regulations; environmental quality; environmental management and supervision; and environmental accidents and emergency responses.

•• In addition, companies that discharge above emission standards must publish information on four categories: the company’s name and address and the name of its legal representatives, the concentration and volume of each pollutant and its discharge mode, the environmental facilities in operation, and the company’s emergency response plan.

•• Disclosure for companies who comply with emission standards is voluntary.

In contrast with the steady progress made in government disclosure of environmental information, the environmental information disclosure from Chinese enterprises has been extremely limited. Until the promulgation of new corporate environmental information reporting requirements over the last year, regulations only mandated disclosure for enterprises known to have exceeded national or local pollution standards, and even this requirement was often flouted. A 2009 Greenpeace study on the implementation of mandatory corporate information disclosure found that none of the 500 Fortune Global and the 100 Fortune China companies found to be in violation of pollutant discharge standards disclosed environmental information within the required period of 30 days.22

Large scale reduction in emissions must be realized to address China’s formidable pollution problems. In addition to strengthening enforcement, the government needs to incentivize companies to reduce their emissions, and decision-makers need to be able to identify key sources of emissions and encourage public monitoring of pollution sources by opening access to information.

International experience has demonstrated that well-designed environmental disclosure policy tools can help drive pollution reduction.

China’s next step should be to formalize enterprise disclosure of pollutant releases and transfers through the establishment of a national Pollutant Release and Transfer Registers (PRTR) system (see page 46).

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International Experience with Environmental Information Disclosure Policy Tools Over the past two decades, an increasing number of countries around the world have adopted national or large-scale environmental disclosure programs, motivated by goals spanning the public’s right to know to encouraging pollution reduction. Such programs are widely considered to be the “third wave” of environmental management, complementing “command and control” approaches and market-based tools. Two main types of programs have emerged: pollutant release and transfer registers, and performance rating and disclosure systems.

Why China Needs a National PRTR System Now Just a few years ago, talk of a PRTR for China might have seemed a bit abstract, yet that is precisely the direction China is headed today. The foundation for a PRTR-like system in China has existed for some time.

Under the 2003 Cleaner Production Promotion Law, the MEP and other agencies are required to disclose factory-level emissions for heavily polluting enterprises. However, as a “promotion law” with no regulatory teeth, it effectively relies on voluntary disclosure by enterprises.

New laws and regulations with potentially game-changing provisions for environmental information disclosure present significant opportunities for deepening environmental transparency. At a macro level, the passage of long-awaited amendments to China’s Environmental Protection Law this April provides environmental protection officials with greater enforcement authority.

Significantly, the law now has an entire chapter devoted to environmental information disclosure and public participation, including provisions locking in recent regulations on real-time emissions data disclosure for key state-controlled enterprises (see

Pollutant Release and Transfer Registers The Pollutant Release and Transfer Register (PRTR) system—an environmental database to collect and disseminate information on environmental release and transfers of toxic chemicals from industrial facilities—was first pioneered in the U.S. in the 1980s with the Toxics Release Inventory (TRI), created in the wake of the devastating Union Carbide chemical accident that killed over 3,700 people in Bhopal, India. In less than a decade, chemicals on the TRI list decreased by over 45 percent. To get a sense of the scale of reductions, 1.3 billion pounds fewer toxic chemicals were emitted to the air, water, and land in the U.S.23 The key to the success of the TRI—at its crux, a simple pollution accounting program—was in how it was used by a diverse range of environmental stakeholders for follow-up actions.

Individual citizens and environmental and community groups use TRI data to pressure polluting companies to clean up and to promote legislative action for environmental protection.

Government agencies can compare the emissions of similar facilities across the country, identify needs and opportunities for source reductions, and evaluate existing environmental programs. Companies have used the data for internal identification of source reduction opportunities as well as to support negotiations with community groups.24 Since 2000, when the EU established the PRTR, pollutant discharge databases have become a convention in modern industrialized countries. To date, PRTRs are in place in over 50 countries and regions around the world. Most tend to be mandatory, specified in legislation, and focused on toxic pollutants not covered by conventional regulations.

According to the OECD Council, the core elements of a PRTR system are: ••A listing of chemicals, groups of chemicals, and other relevant pollutants that are released to the environment or transferred off-site; ••Integrated multi-media reporting of release and transfers (to air, water and land); ••Self-reporting by covered industry or business categories; ••Periodic reporting (preferably annually); and ••Making data available to the public.

International experience demonstrates that PRTRs can improve environmental protection by enhancing the government’s ability to prioritize and target enforcement efforts, fostering competition among enterprises to reduce emissions, and strengthening public monitoring of polluters.25 PRTRs tend to operate in countries with well-developed regulatory systems and a strong, well-organized environmental civil society sector capable of using PRTR data to mobilize public pressure on offending firms.

page 48), and provisions forbidding and creating potentially substantial penalties for the falsification of data.

Furthermore, MEP’s “Measures for the Registration of Hazardous Chemicals for Environmental Management,” which went into effect in March 2013, and “Measures on Self-Monitoring and Information Disclosure of Key State-Controlled Enterprises”, which went into effect in January 2014, provide for a PRTR framework. The former makes it mandatory for companies using or producing hazardous chemicals to

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disclose release and transfer information of priority hazardous chemicals and pollutants, as well as the emission monitoring results.30 Under the latter, key state-controlled enterprises—the biggest polluting companies that together account for 65 percent of China’s industrial emissions as identified on an annual government authored list—are now required to monitor and disclose their air emissions and wastewater discharges continuously to the public on a platform established by the provincial or city-level environmental department.31

USCG Press / CC BY 2.0

The city of Ningbo, in Zhejiang Province, has led the PITI rankings for four years.

Under these regulations, ad hoc provisions for a prototype PRTR now exist in practice, even if not in name.

The next step is formally establishing a PRTR system. Rather than a constellation of city and provincial disclosure platforms as proposed under the new measures, having a centralized national database of emissions data using common identifiers for chemicals, facilities, and locations would facilitate comparison and aggregation of data and allow for tracking of emissions trends over time, which would be a boon for environmental officials.

In the past, China’s capacity (or lack of it) to implement such a system was cited as the main barrier to implementing a PRTR system.

Under its 12th Five Year Plan, however, China has invested significantly in

expanding monitoring networks— spending USD $6.6 billion between 2011 and 2015 to boost its real-time monitoring capacity—and has committed to environmental investment and the development of environmental protection industries.32 Finally, a national PRTR has some domestic precedent to build upon. A pilot PRTR project, funded under the EU-China Environmental Governance Program, is currently underway in the Tianjin-Economic Technological Development Area (TEDA).33 The project began in January 2013 and will run until December 2014.34 The political commitment, funding, and human resources for better enterprise environmental information disclosure are now all in place for the establishment of a national PRTR system in China.

Recommendations for Implementing a PRTR System in China In the short-term, TEDA Eco Center should conduct monitoring and evaluation of the TEDA PRTR pilot.

MEP should develop additional municipal-level PRTR pilot projects, building upon TEDA PRTR evaluation results, as a proof of concept.

Successful municipal-level pilots could be expanded into provinciallevel programs.

Implementing a PRTR in several stages can help identify potential problems and issues before implementation on a national scale. It would also provide industry and government opportunities for learning. Ideally, candidates for municipal-level PRTR pilots would be cities that have performed well in implementing the open

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environmental disclosure measures, and that are also industry-heavy. Each pilot should consider partnerships with research institutions, international environmental NGOs, and international organizations, which can provide technical assistance and policy support.35 Based on the early experiences of the TEDA PRTR pilot, where a major obstacle for project implementation has been companies’ lack of understanding of PRTRs, it would be crucial to provide adequate training and guidance for companies. This is particularly important considering the corporate sector’s generally low levels of awareness of environmental information disclosure.36 This could include training workshops introducing PRTRs to companies to increase their understanding of what is required of them, as well as more sector-specific trainings.

Finally, to ensure stakeholder buy-in and cooperation, the MEP should regularly engage a wide range of affected and interested stakeholders, including representatives from government, industry, and environmental organizations, in consultations throughout the PRTR’s design and development.

In the long-term, the MEP should develop a national PRTR system covering conventional and toxic pollutants in order to use the PRTR data to track pollutant emissions over time, evaluate progress in reducing emissions, and inform national pollution prevention and sustainability priorities.

The process of developing a national PRTR system provides a good opportunity for China to consolidate existing environmental reporting requirements. MEP should consider the potential to integrate current reporting on pollution information into a single national database covering releases and transfers across all environmental media. An integrated pollution information system could aid government officials in making national environment assessments and formulating national

Environmental Performance Rating and Disclosure Programs The challenges posed by PRTRs for developing countries—technical feasibility and the public’s ability to understand and use complex emission reports—have led to a preference for programs that condense complex information into publicly disclosed environmental performance ratings.

Such programs have been touted as a means of getting around perhaps the most daunting obstacle to pollution control in developing countries—weak regulatory institutions.

Motivated by its environmental enforcement agency’s limited capacity to tackle growing environmental challenges arising from industrial expansion, Indonesia established the developing world’s first environmental performance rating and disclosure program in 1995, with support from the World Bank and U.S., Canadian, and Australian development agencies.

Under the Program for Pollution Control, Evaluation and Rating (PROPER), companies selfreport their pollution levels, which are subsequently analyzed and checked by the government’s environmental enforcement agency, and are then assigned a rating according to a simple, five-color grading scale. Ratings are first shared with the companies and, following a retesting period, are then disclosed to the public. PROPER has been credited with improving the average environmental compliance rate of covered companies from 30 percent in 1995 to nearly 70 percent in 2011.26 China followed suit with its Green Watch program in 1999, establishing pilot programs in two municipalities, Zhenjiang (Jiangsu Province) and Hohhot (Inner Mongolia Autonomous Province). Modeled after Indonesia’s PROPER, Green Watch rated companies based on environmental performance and broadcast the results through media outlets. Several preliminary studies on the Green Watch pilots suggested they had positive impacts on regulatory compliance, with compliance rates among covered companies increasing 10 percent in Zhenjiang and 39 percent in Hohhot after the first year of the pilot programs.27 Based on its pilot, Jiangsu Province decided to promote province-wide implementation of Green Watch in 2001. The State Environmental Protection Administration, MEP’s predecessor, subsequently issued non-mandatory guidance in 2005 encouraging nationwide implementation of Green Watch, but the rating system was halted in Hohhot after the pilot phase and does not seem to have taken off beyond Jiangsu Province.28 However, a trial guideline on corporate environmental performance rating jointly released this January by MEP, the National Development and Reform Commission, and China’s banking regulators may revitalize this approach.29 Under this new initiative, targeted companies, which include both heavy polluters and those that have been sanctioned for environmental violations, will have their environmental performance considered by financial institutions when applying for loans.

environmental policies and strategies.

On a more practical level, it could reduce reporting burdens and administrative costs for both government and industry.

Finally, considering the nature of PRTRs as soft policy tools that require follow-up action to drive improvements in environmental quality, the importance of robust civil society engagement cannot be understated.

MEP can help facilitate public access and engagement through developing complementary tools to help users understand and utilize PRTR data.37

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Concluding Thoughts Going forward, an important consideration for China’s environmental transparency movement is what the impact of information disclosure has been. In other words, has greater disclosure of environmental information led to improved environmental outcomes, and has that improvement led to greater responsiveness and accountability? Environmental transparency is substantive to the extent that a society’s stakeholders—government, companies, civil society, and individual citizens—make use of the

information disclosed. Though beyond the scope of this paper, China’s vibrant environmental NGO sector has and will continue to play a critical role in its environmental transparency movement and, increasingly, in using the data obtained to assist the government in enforcing its environmental laws.

The forces that have triggered demand for public access to environmental information elsewhere around the world are in full force in China: environmental problems of indisputable gravity and scale, rising activism in civil society, and the development and spread of information technology and means of communication. On top of that, we are seeing an unprecedented commitment to environmental transparency at the national level. The overall form of China’s environmental transparency movement is lumbering forward—it is a trend that is unlikely to be reversed—but the momentum must be seized. The time for the establishment of a national PRTR system in China is now.

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designated 60 points as the “passing” score.”

15. Institute of Public & Environmental Affairs,

25. Institute of Public & Environmental Affairs,

establish a legal basis for public interest litigation

Natural Resources Defense Council. Bottlenecks

Natural Resources Defense Council. Breaking the

and extend standing to bring public interest cases

& Breakthroughs: The 2012 Pollution Information

Ice on Environmental Open Information: The 2008

to social organizations that are 1) registered with

Transparency Index (2013).

the civil affairs departments at the prefecture level

Pollution Information Transparency Index (2009).

16. Lorentzen, Landry & Yasuda. Impeding

26. Afsah, S et al. Environmental Regulation and Public

or above; and 2) have been continuously active in

Authoritarian Transparency: How China’s Industrial

Disclosure: The Case of PROPER in Indonesia (RFP

environmental public interest activities for at least

Giants Hold Back Institutional Reform (2010); Tan, Y.

Press, New York, 2013).

www.thesolutionsjournal.org | July-August 2014 | Solutions | 49

Gustavo Madico / CC BY 2.0

As of January 2014, state-controlled enterprises are required to monitor and disclose their air emissions continuously to the public on a platform established by the provincial or city-level environmental department

27. Dasgupta, N et al. Pollution and Capital Markets in Developing Countries. Journal of Environmental Economics and Management 42, 310–335 (2001); Wang, H et al. Environmental Performance Rating and Disclosure: China’s GreenWatch program.

Implementation). Ministry of Environmental Protection (2013).

32. Chen, K & Reklev, S. China’s big polluters exceed emission limits—report. Reuters (January 2014).

33. Tianjin-Economic Technological Development

Intergovernmental Forum on Chemical Safety.

36. Zhang, C. Examining Business Perceptions of a PRTR in China. MSc Thesis (2013).

37. For inspiration, MEP could look at the experiences of the U.S. Environmental Protection Agency (EPA),

Journal of Environmental Management 71, 123–33

Area (TEDA) is situated within the Tianjin Binhai

which has recently designed a suite of online

(2004).

New Area, a Special Economic Zone in Tianjin. The

tools for citizens to analyze TRI information. For

TEDA PRTR pilot is coordinated by the TEDA Eco

instance, the EPA’s My Right-To-Know is a user-

Environmental Behavior. No. 125 State Environmental

Center (a non-profit organization supported by the

friendly mobile application that helps users locate

Protection Administration (2005).

TEDA Administrative Commission and regulated by

nearby facilities for a given address, and provides

the TEDA Environmental Protection Bureau).

summary-level TRI information, including the

28. Opinion on Accelerating the Evaluation of Corporate

29. China links corporate credit with environmental efforts. Xinhua (January 2014).

30. Measures for the Registration of Hazardous Chemicals for Environmental Management (Provisional). Ministry of Environmental Protection (2012).

31. Measures on Self-Monitoring and Information Disclosure of Key State-Controlled Enterprises (Trial

34. EU-China Environmental Governance Programme.

facility’s toxic chemical releases and the associated

Policies and Practice of Corporate Environmental

potential health effects. For more experienced users,

Information Disclosure in China (May 2013).

the EPA developed the Toxics Release Inventory

35. Beyond the EU, other international organizations

Chemical Hazard Information Profiles (TRI-CHIP), a

that support national development of

searchable database containing toxicity information

PRTRs include the OECD, UNITAR, and the

for TRI chemicals.

50 | Solutions | July-August 2014 | www.thesolutionsjournal.org