The growth of China into an economic world power has been both exciting and concerning to the rest of the developed world for a number of reasons.  All of this growth can come at a high price in a number of areas from labor rights to infrastructure development.  However, one of the most visible and widely recognized byproducts of the explosive growth that China has experienced over the last few decades has been its toll on the environment of the country.   Approximately half of the country’s rivers are too polluted to use for drinking water, and 20% are so toxic they can’t be used for any purpose, including industry and farming. More than 300 million people lack access to safe water in China as well. Less than 60% of sewage is treated before being dumped into waterways.

Ma Tianjie, the director of the Greenpeace campaign against toxic waste states that Chinese environmental health and safety (EHS) laws have come a long way and are presently fine.  The issue is with enforcement.  Having the right laws in place is an important step, as they didn't even exist or were ineffective at one point in time.  The 10% year over year economic growth China has enjoyed for decades owes a large part to the "pollute first, ask questions later" laws that had been in place.  Chinese leaders are beginning to understand now, however, that this can't continue on its current path.  China doesn't have the luxury that the US did during the industrial revolution.

In the past few years, China has taken huge steps towards improving the environment.   Green practices have been touted as part of the Communist Party’s aim to build a “harmonious society”. The Government aims to have China generating 20% of its electricity from renewable sources by 2020, up from 7% in 2005. The country already has more renewable-energy capacity than any other.  China is even targeting a 40-45% reduction in greenhouse-gas emissions as a proportion of its GDP by 2020.

According to Green Biz, companies themselves are also beginning to take matters into their own hands in areas where the laws or enforcement of the laws haven't caught up yet.   By implementing EHS practices commonly seen in the US at their Chinese facilities, supply chain and manufacturing operations stay ahead of the curve.  This provides a number of benefits for the company.  First, it facilitates commonalities and synergy between Chinese business practices and other Western country business practices.  Second, it ensures long term sustainability of the company's presence in China.  It also provides great public relations, and helps the local wildlife and human populations in the area.  

Green supply chain and business practices in China have come a long way towards catching up with the power of the Chinese economy.  Once they do, it will ensure that China's unrivaled growth can continue for decades.

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Scott Decker

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