[Author: Ruggero Giorgetti]
We recently had the privilege of interviewing Professor Perrini, Director of the Transformative Sustainability Program at Bocconi University. During our discussion, we delved into China’s stance on sustainability, its ambitious carbon neutrality objectives, and the pivotal role played by Chinese corporations in fostering sustainable development.
China, notorious as the world’s largest emitter of CO2, presents contradictory energy and industrial policies. Despite significant reliance on coal, the country has witnessed a remarkable surge in renewable energy production and storage. In 2023, China accounted for over half of all newly installed solar and wind power capacity worldwide, including 50% of solar, 60% of onshore wind, and 70% of offshore wind. Additionally, the country ranked first for new nuclear and hydroelectric capacity based on new photovoltaic installations during the year.
Professor Perrini explains that China is experimenting on a large scale with various technologies for storing renewable energy, including compressed-air batteries, flow batteries, hydrogen energy storage, and gravity systems. Thanks to this unparalleled effort, China has already surpassed its goal of generating less than half of its electric power from fossil fuels, achieving this milestone earlier than the initially targeted year of 2025.
Europe has played a pioneering role in the development of regulations and frameworks for sustainable investments. However, he notes that China is rapidly catching up. The Chinese green industry, aided by state subsidies and dumping practices harming foreign industries, has arisen from a more forward-thinking policy that sees great potential in certain sectors (e.g., electric vehicles) that are less controlled by the West. The government is heavily investing in the use of alternative energies while simultaneously encouraging people to adopt more sustainable lifestyles. The present circumstances instill confidence in China’s ambitious aim of attaining carbon neutrality by 2060.
The Chinese commitment presents significant opportunities for investors seeking to support companies and projects aligned with sustainability goals. Professor Perrini emphasizes the importance of social factors such as labor rights management, diversity and inclusion, and engagement with local communities in ensuring an ethical and sustainable approach to investments.
In terms of advice for Chinese companies looking to establish a strong foundation for sustainable growth and long-term success, Professor Perrini highlights the importance of adopting ESG criteria. The Shanghai and Shenzhen stock exchanges have implemented stricter rules on the disclosure of environmental, social, and governance information by listed companies, requiring transparency on environmental impact, engagement with local communities, risk management, and board composition.
He also cites successful examples of Chinese companies that have excelled in integrating sustainability into their business models, such as LONGi Green Energy, which was nominated in Forbes China’s “2022 Top 50 Sustainable Industrial Companies” list thanks to its performance in green production, sustainable development, and ESG. This recognition aims to identify green manufacturing enterprises with significant national influence and that can establish new benchmarks for the industry, ultimately assisting the country in approaching the goal of carbon neutrality.
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