Environmental protection is one of the most important pillars for a company to achieve sustainable growth in the future. It is not merely a trend to promote a “Green Image” and “Save the Planet” slogans, but in fact, it is an issue that needs to be considered seriously. If not, there will be no place to settle down our businesses no matter how much money we invest, what fancy-catchy image we promote and what great product or service we provide.
It is well known that China faces some critical issues regarding pollution and environmental protection. As the driver of the highest economic growth in the world, China will face higher immigration rates, large-scale urbanization, and a possibility that the country’s air, water and soil will become “heavy.” Beijing’s negligent vision towards the environment in the past has contributed to the present situation. The country also has the highest death rate due to pollution. Twenty of the 30 most polluted cities of the world in 2007 were from China. The list goes on.
All these facts support the reality that China is desperately in need of environmental services. As measures to salvage the current situation, the government has started making efforts now. According to the Eleventh Year Plan issued in 2005, $175 billion is estimated to be spent on environment protection. Since the1970s, China has registered a high growth rate of 25 percent annually. However, it still seems like a long way to go.
Environmental services account for approximately only 10 percent of the entire environmental industry, compared to the average international standard, which is 50 percent. The sector faces other issues such as:
• Foreign players have limited possibilities to act due to the legislation.
• Official data regarding pollution has limited disclosure and is often intentionally modified, but efforts are being made to improve. For example, in February 2010, the government issued an Environmental Report showing that water pollution in 2007 was twice as higher than the official data that had been reported on that date. A clearer disclosure helps admitting the problem and this is the first step in resolving it.
Therefore, environmental services in China have a bright perspective of development and innovation. The long distance runners within this sector can easily position themselves in the marathon of economic growth towards “clearer” perspectives.
Simona Spahiu is a Sustainability Analyst with Solaron Sustainability Services. Solaron (www.solaron.in) is a niche Sustainability / ESG research firm with a global team of 60+ Analysts present across several Emerging markets like India, Brazil, China, UAE, Mexico, Russia, Eastern Europe and Africa.
