5 Sustainability Trends in China

5 min read.

In 2018, China was reported to be the largest emitter of carbon dioxide gas (CO2). With 10.06 billion metric tonnes, and a share of nearly 30 percent of the world’s total CO2 emissions that year, China contributed almost twice the amount of CO2 emissions of the second biggest emitter, the United States (US). Being the world’s greatest CO2 emitter, China has faced public scrutiny from several international communities, including the United Nations and the World Trade Organization, who have agreed that China must play a part in lowering its emissions in order for the global sustainability movement to move forward.

China emerged the top global emitter of CO2 in 2018.
Source: Investopedia

So, how has China taken action to salvage the environmental crisis and driven the global sustainability movement forward? In this article, we delve into five sustainability trends that have prevailed in China in recent years.

Sustainable Manufacturing

Sustainable manufacturing refers to the creation of products through economically sound practices. As a more environmentally-friendly, yet still economically viable alternative to commercial manufacturing, this practice has become increasingly popular among Chinese brands. It allows manufacturers to capitalize on the green economy, minimize the negative impacts of their operations on the environment, and reduce their consumption of energy and resources. 

A domestic leader to adopt sustainable manufacturing methods was the Chinese cashmere brand Erdos. In alignment with the national Made in China 2025 agenda to move up the value chain and automate the manufacturing industry, Erdos became one of the first Chinese manufacturers to leverage technology to greenify all its production processes like machine manufacturing, design, and supply chain. 

Additionally, more Chinese retail and fashion brands have also committed themselves to sustainable business models in recent years. Following a rising consumer demand for more eco-conscious products, companies have increasingly adopted sustainable business models or changed their existing business models to become more environmentally conscious. Reclothing Bank, a Shanghai-based designer brand, is one such company. The brand promotes sustainable fashion by upcycling old fabrics to create new, aesthetic and fashionable outfits. To further promote their cause, they have also promised to donate 1 percent of their sales revenue to public environmental protection programs in China.

Chinese companies have increasingly turned to sustainable manufacturing by automating manufacturing processes.
Source: ET2C

Renewable Energy

Under the National Renewable Energy Law passed in 2005, China set a national target of producing just 16 percent of its primary energy from renewable sources by 2020. In order to enhance the feasibility of such a regulation, the government has also offered financial incentives such as discounted taxes for renewable energy projects, and even a national fund to foster renewable energy in tandem with the passage of this law.

As a result, China has surged ahead in its wind, solar, and hydropower capacities in recent years. According to Fortune, it is currently the world’s largest producer of solar panels and wind turbines, contributing to approximately 70 percent of the global market for the former, and about 13.6 percent for the latter. In addition, China is also set to surpass the US as the world’s largest producer of power from nuclear energy by 2030, up two positions from its current standing as the third largest producer in the world.

A solar power plant in Huainan, Eastern China.
Source: Getty Images

Sustainability Reporting

According to China Briefing, sustainability reporting is a way for companies to measure their impact and performance on various environmental, social, and governance (ESG) issues ranging from climate change to data security.

In recent years, Chinese corporations have increasingly engaged in sustainability reporting, as part of an ongoing trend to promote accountability and commitment to ESG causes. The Global Reporting Initiative (GRI) Sustainability Reporting Standard, the most commonly used and globally recognized reporting style, became increasingly popular. Prominent brands like China Mobile and BMW Brilliance Automotive Ltd. have all diligently practiced ESG disclosure under this guideline. These companies have also notably integrated ESG practices into their businesses, and deployed technologies such as artificial intelligence (AI) and big data to amplify their sustainable impact.

In support of increased sustainability reporting, banks, the primary source of credit in China, have also increasingly issued green bonds to companies pioneering green initiatives such as upgrading to coal-fired power stations and generating over 50 MW of hydropower electricity. Within just four years, China has become the world’s second-largest issuer of green bonds after the US, raising a total of US$31.34 billion in 2019. The cumulative impacts of these green bonds have reportedly led to a reduction of over 52.6 million tonnes of CO2 emissions, as well as the installation of at least 11.2 GW of clean energy capacity.

China became the second largest green bond issuer in the world in 2019.
Source: Climate Bonds Initiative

Waste Management

In the past year, waste sorting has become a trend in many Chinese cities. Shanghai took the lead to implement mandatory waste sorting back in 2019, which resulted in a ripple effect across the country. Within less than a year, more than forty cities have also implemented waste sorting, prompting members of the Standing Committee of the National People’s Congress to recommend waste sorting to be further standardized at a national level, in order to facilitate the process in a more organized and efficient manner.

Along the same vein, the Chinese government has also strongly advocated the construction of zero-waste cities. In April 2019, eleven cities were selected as zero-waste pilots in order to test systems enabling the reduction of trash production at the sources, the minimization of landfills, and an increase in recycling. If these pilots succeed, the government hopes to implement the systems across the country to create a zero-free environment nationwide.

Eleven cities were selected to be zero-waste pilots in 2019.
Source: Good360

Conscious Consumerism

Ultimately, the driving force behind these eco-conscious changes can be traced back to consumers. A report by Org Hive indicated a shift toward conscious consumerism by Chinese millennials and Generation Z consumers, who were more drawn towards purpose-driven brands that advocate for sustainability. This shift has been identified to be a result of health concerns, given China’s plethora of counterfeit scandals over the years, as well as an increasing awareness of environmental impacts on the quality of life.

This shift toward ethical and “green” consumerism has in turn spurred brands to become more value-driven and sustainable. According to Alizila, nearly 40 brands on Tmall — including L’Oréal and Giorgio Armani Beauty — used eco-friendly packaging materials during the 2019 Singles’ Day shopping festival. The shift toward a “green” consumerist mindset has therefore become crucial for brands, since they may lose a significant portion of their customer base if they fail to cater to consumers’ “greenified” tastes and preferences. 

The shift towards corporate sustainability is largely driven by conscious consumerism.
Source: Jing Daily

Apart from these five sustainability trends in China, the recent COVID-19 pandemic has further strengthened the belief that environmental sustainability is an imminent necessity. A post-COVID-19 McKinsey & Company survey on consumer attitudes in China found 64 percent of respondents to be more inclined to consider purchasing products that are more environmentally friendly. Moreover, the Chinese government has also recognized the importance of sustainable growth, as seen from their consistent emphasis on the importance of building an “ecological civilization with Chinese characteristics.” With cooperation from both public and private sectors, this plan could come to fruition in the near future.