Green agency to score and rank listed companies
In an effort to rein in corporate polluters, the mainland's environmental protection agency disclosed yesterday it will subject listed companies to annual performance assessments, complete with a score and ranking system.
The announcement follows a decision last summer in which the watchdog said it would ban companies from raising funds in the capital market if they failed to meet certain environmental standards.
The assessments, which will be made public, are an attempt to use transparent and market-oriented measures to hold companies accountable for environmental degradation. The mainland has come under increasing domestic and international pressure to combat pollution.
The State Environment Protection Administration (SEPA) has named 10 companies for 'severe failings in environmental impact assessments' procedures.
Their applications to issue new shares or execute initial public offerings have been blocked by SEPA until their failings are rectified.
They include China Coal Energy, which completed its Shanghai listing last month, and Zijin Mining Group, which received China Securities Regulatory Commission approval to list in Shanghai in December last year.
In a circular issued yesterday, SEPA said all companies in the power generation, steel, cement and aluminium sectors must include a consent document from the environment agency in their listing application.
Those engaged in 13 pollution-prone and energy-intensive sectors with cross-province operations must also do the same. Provisionally, the sectors are metal smelting, chemical, petrochemical, coal mining, coal-fired power generation, construction materials, paper making, pharmaceuticals, tanning, textiles, metals mining, fermentation and brewing.
SEPA said it and the CSRC would work to better monitor listed companies' environmental protection conduct. However, an insider said the fact that the circular was only released in SEPA's name instead of jointly with the CSRC reflected mixed opinions on the policy.
In the past two weeks, SEPA introduced the 'green credit' policy jointly with the China Banking Regulatory Commission to curb lending to polluters and the 'green insurance' policy with the China Insurance Regulatory Commission to force polluters to pay for damage.
'It is obvious that there was some disagreement between [SEPA and CSRC],' a source said.
Asked whether CSRC was involved in policy making on the new rule, a CSRC spokesman would only say: 'The policy was co-ordinated by the State Council and the CSRC shall implement it accordingly under the central authority's directives.'
Analysts said government bodies lacked a sense of team work and tended to give priority to their own benefits when mapping out new policies and initiatives.
'It is rare for SEPA to hope that it can overrule the CSRC,' a source close to the CSRC said. 'The environmental protection authority appears to be terribly arrogant.'