Companies are riding the environment-friendly wave.
Pressure from the national government and tightening regulations in overseas markets are compelling a growing number of suppliers to modify their business strategies and incorporate ecologically safe processes. The transition is neither extreme nor desperate, but the impact could be widespread as many midsize and small companies are also taking “green” initiatives. Due to the sheer number of these suppliers, they account for a large portion of the pollution and wasteful practices in the country.

Irrespective of size, companies are introducing long-term strategies anchored on recycling, waste reduction and sustainable energy adoption.

Recycling is the most common practice among factories, one that is carried out internally or through third parties. This, however, goes beyond reusing offcuts and scrap materials. Highly polluting industries such as leather tanning have always been required to invest in wastewater cleaning systems, but very few actually do. Now, many are investing large sums in such facilities not only to comply with local ordinances but also as a marketing tool. This comes as an increasing number of buyers are including social responsibility as a criterion in supplier selection.

Fujian Guanxing Leather Co. Ltd in Shishi, a city under the municipality of Quanzhou in Fujian province, has invested $3 million in a 6,000-ton capacity wastewater processing station. Once operational, the facility is expected to save the company $1.4 million annually.

In fact, waste recycling is becoming the norm in the city, one of the major garment and textile hubs in the province. More than 20 manufacturers have now installed treatment systems such as those from Carrousel. The majority of Fujian factories that dye fabrics in-house have similar facilities for their sewerage as well. Moreover, several local governments have set up complementary wastewater recycling services to help ensure a continuous supply of fresh water.

When it comes to material refuse, many large enterprises contract professional disposal services. Small and midsize businesses often transact with recyclers and junkyard operators.

Guangdong Weiermei Underwear Co. Ltd, for instance, sells fabric cutoffs to waste collectors. Watch exporter Shenzhen Full Success Gift Mfg Ltd and lock specialist Make Locks Manufacturer Ltd vend metal scraps to recyclers.

Some companies involve customers in their green efforts. On request, Shenzhen FJY Electronic Co. Ltd uses recycled materials during production. Doing so has the additional benefit of lowering unit costs.

Adopting degradable materials, however, does not always bring a similar effect. In the beauty and cosmetics industry, bottles made from such substances are about 20 percent more expensive than conventional plastic.

While recycling and reusing are gaining more adherents, only a handful of operations are tapping sustainable energy sources such as wind or solar power. Cynthia Garments Making (Dalian) Co. Ltd has taken steps to do so by using solar water heating at its workers’ dormitories.

Management disciplines strengthen sustainable practices
In an effort to cement their commitment to environment-friendly manufacturing, many suppliers are acquiring ISO 14001:2004 certification and implementing ERP, 5S, 8S and 3R systems. Doing so lessens raw material wastage, management costs and delivery time. It smoothens production processes as well. “We calculate the exact unit consumption of fabrics and accessories,” Cynthia business manager Tony Tong said. “We purchase strictly in proportion with the orders to reduce wastage.”

Other production and purchasing decisions are also influenced by green principles.

Video phone manufacturer Xiamen Leelen Technology Co. Ltd cooperates with the environmental services group ABB, a global engineering enterprise that promotes sustainable industrial productivity.

Mindful of energy conservation, car amplifier exporter Shenzhen Actiway Electronics Co. Ltd included power saving as a criterion in selecting SMT machines.

Fujian Golden Vision LCD Science & Technology Co. Ltd has designated one of its engineers to be responsible specifically for developing ways to reduce power, water and raw material consumption during production.

Some factories outsource processes that are potentially hazardous to the environment. Lock companies in Zhejiang and Shandong provinces subcontract electroplating and paint coating to local specialists who are not only more capable but also use professional equipment that produces less pollution.

In some industries, higher productivity is correlated directly to waste reduction. Makers are emphasizing worker training to upgrade efficiency, trim down defects and reduce wastage.

But green manufacturing still has its obstacles.

Often suppliers are not motivated enough to adopt sustainable practices in production. Unless required by buyers, any effort to introduce ecologically safe processes is only deemed as an unwarranted cost. For such businesses, compliance with RoHS, WEEE and other regulations is sufficient in showing their environmental commitment.

Greenpeace keeping a scorecard
In October 2009, a report by Greenpeace highlighted the elevated pollution levels in the Pearl River in southern China. As the main source of drinking water for about 4.7 million residents, the estuary is where thousands of factories dump their waste as well. A high-level cocktail of beryllium, copper, manganese, BPA, alkylphenols and other hazardous chemicals were discovered in analyzed samples from eight cities around the river.

The report also enumerated the noncompliance of at least 18 major private locally owned and multinational companies in the Fortune Global 500 or the China 100 list with pollution disclosure rules implemented by the Ministry of Environmental Protection in May 2008. Samsung, Nestle, LG, Motorola and Sinopec were among the companies cited for exceeding emissions standards and failing to publish their pollution data within 30 days after being blacklisted as the rule required.

Greenpeace has been active in helping monitor and expose environmentally destructive practices in China. Its media reports have helped pressure manufacturers to adopt more eco-friendly systems and for local governments and enforcement agencies to implement laws and tighten standards.

The group, however, admitted its own limitations as it failed to include hundreds of thousands of small operations that are also heavy polluters.

This article was originally published by Global Sources, a leading business-to-business media company and a primary facilitator of trade with China manufacturers and India suppliers, providing essential sourcing information to volume buyers through our e-magazines, trade shows and industry research.

China generated more than 150 million tons of household trash last year, as well as 1.9 billion tons of industrial waste, said the Ministry of Environment Protection in its 2008 China Environment Report.

Experts estimate that, due to rapid economic growth, the nation’s volume of trash is rising more than 8 percent annually and, in less than five years, the total amount will be 50 percent more than today.

An issue that Beijing is already having to grapple with:

With space running out in its 13 landfills, Beijing should build new waste treatment facilities and find ways to reduce garbage discharge or the city may run out of space to dump refuse within 4 years, a municipal management official warned yesterday.

Beijing generates 6.57 million tons of garbage every year (18,000 tons a day). These figures are increasing at an annual rate of 8 percent, according to figures provided by Wei Panming, deputy chief of the Environmental Sanitation Facilities Division under the municipal management committee.

Yikes.

A trip to foreign markets like B&Q, METRO, and TESCO and it was a complete ban, and contrary to some skeptics, even the local markets appeared to be changing their ways. Of course, that is based on my time in a major city (Shanghai) , and right after the ban.

One year on though, there have abeen a number of reports though that have shown the results were a mixed bag.  Results that were highlighted through a recent Global village of Beijing online forum to mark the anniversary (h/t China Dialogue) where members of the NDRC, Int’l Food Packaing, and others came together.

The questions, and the answers, were interesting.. and honest:

Host: And over this last year, have we seen the hoped-for results?

Li Jing: Personally, I think the results have been clear and, in the main, positive. In particular, environmental awareness has increased. Shops and supermarkets have implemented the rules well. Things aren’t ideal at some markets, particularly as time passes and the policy gets forgotten. I pretended to be buying vegetables once and asked a few of the stallholders. They felt that nobody was enforcing it any more.

Li Jiajian: Markets and some more remote areas haven’t done so well, and there are variations in implementation. But there’s a process from setting rules and seeing them fully implemented.

From the perspective of a consumer (see a recent report on the awareness of Chinese consumers and willingness to be green):

Host: Wang Jie, you’re a full-time housewife. What changes have you seen?

Wang Jie: It’s definitely made a difference. Now when I go out to buy something I have to check I’ve remembered to bring a bag. It’s a little inconvenient. But I think it’s worth it. Some of my neighbours and friends think it was just for the Olympics, and that the ban should end now. But I think we should stick with it, make it a good habit.

To see the full report out, go to the Green Sohu site that has been set up, but in general, what I am finding is not just that the bags are coming back it is that the line is not being held on a wider level. That the education campaigns are beginning to slow down as the recession has kicked in, and once passionate tree huggers who were being given the megaphone are now silent.

Where this troubles me is simply that it(in the long run) will only serve to reinforce the misconceptions that the envionmental concerns are not really all that important, or are only important when the problems bloom unexpectedly.  It is an attitude that I believe is dangerous as (1) programs for sustainable change will only continue to be put off (2) consumers, who were once catalyzed before, will be harder to activate next time and (3) that it will make the political support for future movements like this one all the more difficult.. after all, who is going to be responsible for putting a major manufacturer out of business when then know in 6 months it will be business as usual again.

Of course, while I am troubled by these issues, I am also encouraged by the fact that we are seeing more and more regular media reports on teh environment, and that large events like the Green Long March are growing in size.  these are encouraging as over the long term attitudes towards and appreciation for the environment will change and stakeholders wil be more likely to engage in an effective manner.

Host: What has the National Development and Reform Commission done towards the recycling of plastic bags?

Li Jing: We’re working on it. There are regulations for the recycling of reusable resources, including plastic bags, which set minimum standards for recycling firms. Those requirements are still low, or non-existent, and we’re working on that. We’re also setting up similar projects as part of circular economy trials, particularly after the release of the circular economy law.

Progress….

Over the last 6 months, the city of Guiyu and its industry of recycling eWaste has seen a lot of coverage.

First you had the report from 60 Minutes

then you had the denial from local officials

Regardless of which report is right though, Alex Hofford, has a new post showing readers that clearly the industry is alive and well, and that the effects of the industry are a true environmental catastrophe.

In the article Chinese Vice Premier says recycling can help boost economic growth, Vice Premier Li Keqiang says:

Promoting recycling would not only improve the use of resources and protect the environment, it would also help companies become more profitable, he said.

Enterprises should employ advanced technology and equipment and improve their management to achieve the most efficient use of resources with the lowest level of pollution and wastes

I conquer

Last year, you may remember the 60 minutes report 60 Minutes Covers eWaste in China where they followed a container of ewaste from the US to Guiyi China.

Interesting enough, according to the article Recycling Nation’s Recyclers , the 60 minutes crew may have got their facts a bit wrong:

The report was amazing to local officials because many of the practices it exposed had been outlawed since 2005.

Also, it wasn’t Guiyu.

“Guiyu has been dealing with the pollution problem since 2000. These efforts were re-doubled in 2005, when Guiyu was named a ‘pilot town’ for recycling by the National Development and Reform Commission,” Lian Wuming, head of the Guiyu township government, told China Business Weekly last week. “These effort have paid off,” he said.

Further:

No one denies that Guiyu, Puning, and many other villages involved in the recycling business are polluted. “The current pollution problem is caused by the treatment of e-waste in primitive household workshops, dating back to the 1980s,” Lian said.

He conceded that some such workshops “are still illegally extracting precious metals in a very simple and backward way,” but said that last year alone, the town shut down 80 workshops and prosecuted 400 cases of illegal burning.

So, what happened?  did the 60 minutes crew/ producers get the town wrong?  Are village officials trying to cover up, or “clear” up the facts?

IT is an interesting twist, and the rest of the article is itself quite interesting – and I urge you to read it.  I am particularly curious about the potential link between the falloff in the economy, and the current lack of activity in guiyi.

Consumers don’t upgrade their electronics are put off, the demand for metals is clearly off, and many of those shops which were running on fumes (literally and figuratively) have more than likely met their organizational demise.

So, what is the real story?  Who knows, but it is clear that whether or not the producers got the name right, the fact is that right now there is an opportunity to clean up the remaining mom and pop shops by investing in them and bringing them up so that when the flotilla of waste reaches them they are ready

I have written on the topic before in terms of how the value of scrap was driving people to rip wire out of houses, and football stadiums, and 60 minutes recently did a spot on eWaste in China.

Now, Adam over a Shanghai Scrap has a fantastic photo diary in The Atlantic Online entitled Where America Recycles of where all those scrapped items from the US and other countries is ending up.

If you are not following Adam’s site, I suggest you do as there is a lot of interesting behind the scenes on China’s scrap industry and I find it a great read.

Unlike, the ones that grace the runways of Paris, London, New York, or Shanghai, the clothing highlighted at this show was designed by elementary kids using recycled materials.

Fashion creations made of newspapers, packaging bags, plastic bottles and leaves designed by 280 students were displayed here on Thursday.

All jokes aside, I must give the organizers credit for taking this innitiative. As I have pointed out in several posts here and on Crossroads, it is important to get them while they are young before they develop bad habits.