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China to Link Credit to Companies’ Environmental Records

From Clean Biz Asia, Published 06 January 2014

​Chinese companies are to be rated by the government on their environmental performance records which will, in turn, determine how they are treated under various social and financial aspects.

So called "environmental credits" under a trial guideline on corporate environmental credit evaluation, will be issued based on companies' performance in following environment-related rules and fulfilling their duties in environmental protection.

These credits will be used as references for public supervision and by financial institutions when considering loans.

The document was jointly released Thursday by the Ministry of Environmental Protection, the National Development and Reform Commission, the People's Bank of China and the China Banking Regulatory Commission.

Aimed at raising the cost for enterprises' environmental violations, the system will also guide related government departments, associations and unions to offer favorable treatment for companies with high environmental credit in administrative approval, procurement, financial support and certifications.

According to the document, targets for the trial credit evaluation include companies in heavily polluting industries and those that have been punished for environmental pollution previously.