A telling moment came during a recent conference on environmental management in Shanghai. Company representatives sought to discuss lobbying platforms, but when they turned to the government official in attendance for answers, he had already left.
China's increasing levels of pollution may be a high-profile subject but multinational companies are finding their efforts to take concrete action thwarted by convoluted regulations, government inaction and a lack of communication.
More than that, the chasm between public and private sector may actually be widening. This is happening as the onus for change increasingly falls on business actively lobbying government rather than the other way around.
Du Qun, deputy director for the Research Institute of Environmental Law at Wuhan University, said companies should pressure government together.
"The government will listen if you go to them in large groups and show them your research and concerns for your industry, otherwise, they won't see what you see," Du said during the 2007 China Environmental Management Conference in Shanghai in March.
"It also is important for companies to be proactive in research and keeping up with the latest reforms."
But multinational companies are growing increasingly frustrated.
Beijing may be committed to controlling pollution, and has pledged US$250 million to develop better monitoring systems over the next 18 months, but the overall goal of improving China's environmental performance remains elusive.
In 2006, the country missed its targets for reduction of greenhouse gas emissions by 2% and China is now expected to overtake the US in terms of greenhouse-gas emissions in the next decade.
The growing environmental problems are exacerbated by a lack of industry-focused dialogue. While China is putting the laws in place to deal with pollution, they are often ambiguous and there is a clear lack of communication between government and business, said Wang Wen Jun, manager for environment, health, safety and security at Pfizer in Shanghai.
The regulatory environment is so convoluted that companies in China have come to accept confusion in interpreting environmental laws as normal practice.
One example is a new law banning six toxic chemicals from a range of consumer products. China adapted the law from a similar one developed by the EU but then failed to clarify what products or indeed what sectors fall under it. This lack of detail, said Wang, is typical.
"The lack of understanding has led regulators to sometimes implement regulations that do not fit with our current infrastructure."
Similar concerns arise over the lack of a mechanism to lobby government.
Chen Jian, an environmental advisor for Shell Chemicals, said it is difficult to know where to start a dialogue. Many companies have gone to researchers such as Du to act as intermediaries but this isn't necessarily a direct or effective channel.
Companies like Haier and IBM have seen effective results in the past by banding together, as they did in their feedback to a recent recycling law, but the government does not always listen to companies that have come forward.
Rebecca Su, a former environmental manager at Johnson & Johnson who now works with environmental compliance specialists CH2M, said companies have been pushing the government to take action on the growing problems with excess waste for years to no avail.
Without proper treatment, storage and disposal facilities (TSDF) available, Su said companies have to find their own solutions. Multinationals have the means to build their own but that leaves smaller local companies in a bind.
"Unfortunately, the government has not yet done anything to improve the number of qualified TSDFs and it's not rare to find toxic waste that has been sitting around for 10 years before it's disposed [of]," Su said.
This lack of waste treatment facilities creates a hurdle but also represents an opportunity for foreign companies with the right technologies – at least in theory.
Malaysia-based UEM Environment is looking specifically at China with a view to opening a TSDF plant in the country. In what is becoming a familiar comment, though, the company doesn't know where it stands with the regulators.
"We ran into some confusion when dealing with the government," said UEM development manager Bernard Liew. "We still have a long way to go in terms of how foreign waste management companies function in China."
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