Chinese Outbound Investment: Environmental and Social Standards and Guidelines

Social and environmental safeguards are meant to protect people and ecosystems from the negative impacts of investment projects. Safeguards are policies, standards and systems that developers, investors and financiers implement to prevent and mitigate the negative impacts of their business activities. Safeguards should be implemented during the entire project cycle, from identification, design and preparation, through development and operation, to the closure of a project.

Chinese companies and financiers often lack strong institutional policies to deal with social and environmental issues. However, this is beginning to change. China’s policy banks have adopted internal social and environmental policies. Several Chinese companies have made commitments to operate in a responsible manner when operating overseas, and some have signed on to international principles and standards. Importantly, Chinese state institutions and industry groups have recognized the need for improved social and environmental standards in overseas investments and in recent years have issued several sector specific guidelines.

These guidelines are discussed in detail in Inclusive Development International’s publication Safeguarding People and the Environment in Chinese Investments: A Guide for Community Advocates. The policies, standards and guidelines covered in that publication are compiled here for reference. New documents will be posted here as and when they are adopted.

General Principles

State Council, Nine Principles on Encouraging and Standardizing Foreign Investment (2006) – EnglishChinese

State Council, Opinions of the State Council on Encouraging and Standardizing Enterprises’ Cooperation in Foreign Investment (2007) – EnglishChinese

Ministry of Commerce, Ministry of Foreign Affairs & State-owned Assets Supervision and Administration Commission, Circular to Regulate the Overseas Investment and Cooperation of Chinese Companies (2008) – English, Chinese

Approval and Monitoring of Overseas Investment

Central Committee of the Communist Party of China, The 13th Five Year Plan for Economic and Social Development of the People’s Republic of China (2016) – English (Note: Chapter 50, Section 2 focuses on regulation of outbound investment)

Ministry of Commerce, Provisions on Standardizing Competition in Foreign Investment and Cooperation (2013) – English, Chinese

Ministry of Commerce et al, Provisional Measures for Recording Bad Credit in the Fields of Outbound Investment and Cooperation and Foreign Trade (2013) – English, Chinese

Standards Applying to State-owned Enterprises

State-owned Assets Supervision and Administration Commission, Guidelines to the State-owned Enterprises Directly Under the Central Government on Fulfilling Corporate Social Responsibilities (2007) – English, Chinese

Standards Applying to Contractors

State Council, Administrative Regulation on Contracting Foreign Projects (2008) – English, Chinese

China International Contractors Association, Guide on Social Responsibility for Chinese International Contractors (2012) – Chinese & English (Note: scroll down for English)

Guidelines on Environmental Protection

Ministry of Commerce and Ministry of Environmental Protection, Guidelines for Environmental Protection in Foreign Investment and Cooperation (2013) – English, ChineseKhmerBurmese, FrenchSpanish

Sector Specific Guidelines

Mining

China Chamber of Commerce of Metals Minerals & Chemicals Importers & Exporters, Guidelines for Social Responsibility in Outbound Mining Investments (2014) – English & Chinese (Note: scroll down for English)SpanishFrench

China Chamber of Commerce of Metals Minerals & Chemicals Importers & Exporters, Chinese Due Diligence Guidelines for Responsible Mineral Supply Chains (2015) – English, ChineseSpanishFrench

Forestry

State Forestry Administration & Ministry of Commerce, Guide on Sustainable Overseas Silviculture by Chinese Enterprises (2007) – EnglishChinese

State Forestry Administration & Ministry of Commerce, Guide on Sustainable Overseas Forest Management and Utilization by Chinese Enterprises (2009) – EnglishChinese

Information Communication Technology

Committee on Social Responsibility of the China Electronics Standardization Association, Social Responsibility Guidelines for the Chinese Information Technology Industry (2012) – Chinese

Hydropower

Sinohydro, Occupational Health, Safety and Environmental Policy Statement (2013) – English

Sinohydro, Sustainable Development Policy (2014) – English

Sinohydro, Statement of Ethical Principles (2014) – English

Sinohydro, Compliance Program Announcement (2014) – English & Chinese

Sinohydro, Environmental protection policy statement (Undated) – English

Sinohydro, Good Governance Policy (Undated) – English

Sinohydro, Occupational Health and Safety Policy Statement (Undated) – English

China Datang Corporation, Regulation on Environmental Protection (Undated) – Chinese

China Datang Corporation, Handbook on Safety Risk Evaluation for Datang’s Hydropower Companies (2011) – Chinese

China Datang Corporation, Regulation on Project Safety, Health and Environment (2009) – Chinese

Standards and Guidelines Applying to the Finance Sector

China Banking Regulatory Commission, Green Credit Guidelines (2012) – English, ChineseSpanish

China Banking Regulatory Commission, General Office of the China Banking Regulatory Commission Opinions on Green Credit Implementation (2013) – EnglishChinese

China Banking Regulatory Commission, Notice of the China Banking Regulatory Commission on Key Performance Indicators of Green Credit Implementation (2014) – EnglishChinese

China Banking Regulatory Commission, Key Performance Indicators of Green Credit Implementation (2014) – EnglishChinese

People’s Bank of China et al, Guidelines on the Construction of Green Financial System (2016) – Chinese & English (Note: scroll down for English)

Export-Import Bank of China

China Eximbank, Guidelines for Environmental and Social Impact Assessments of the China Export and Import Bank’s Loan Projects (2007) – EnglishChinese

China-ASEAN Investment Cooperation Fund

China-ASEAN Investment Cooperation Fund, Social Responsibility and Environmental Protection Guidelines for Investments in the ASEAN Region (2014) – English

Asian Infrastructure Investment Bank (AIIB)

Asian Infrastructure Investment Bank (2015), Articles of Agreement – EnglishChineseFrench

Asian Infrastructure Investment Bank (2016), Environmental and Social Framework – English

Asian Infrastructure Investment Bank (2016), Public Information Interim Policy – English

Policies, Plans and Guidelines Applying to Investment in “Belt and Road” Countries

Central Committee of the Communist Party of China, The 13th Five Year Plan for Economic and Social Development of the People’s Republic of China (2016) – English (Note: Chapter 51 focuses on the Belt and Road Initiative)

National Development and Reform Commission, Ministry of Foreign Affairs & Ministry of Commerce (2015), Vision and Actions on Jointly Building Silk Road Economic Belt and 21st-Century Maritime Silk Road – EnglishChinese

Office of the Leading Group for the Belt and Road Initiative (2015), Action Plan to Connect “One Belt, One Road” through Standardization (2015-2017)English, Chinese

Office of the Leading Group for the Belt and Road Initiative (2017), Building the Belt and Road: Concept, Practice and China’s ContributionEnglishChineseSpanishFrench, Russian, German, Arabic

National Development and Reform Commission & National Energy Administration (2017), Vision and Actions on Energy Cooperation in Jointly Building Silk Road Economic Belt and 21st-Century Maritime Silk RoadEnglish, Chinese

National Development and Reform Commission & Ministry of Agriculture (2017), Vision and Actions on Agriculture Cooperation in Jointly Building Silk Road Economic Belt and 21st-Century Maritime Silk RoadChinese, English

National Development and Reform Commission & State Oceanic Administration (2017), Vision for Maritime Cooperation Under the Belt and Road Initiative – EnglishChineseRussianArabicSpanishGermanFrench

Ministry of Environmental Protection, Ministry of Foreign Affairs, National Development and Reform Commission & Ministry of Commerce (2017), Guidance on Promoting Green Belt and RoadEnglishChinese

Ministry of Environmental Protection (2017), The Belt and Road Ecological and Environmental Cooperation PlanEnglish, Chinese

Finance Ministers of Argentina, Belarus, Cambodia, Chile, China, Czech, Ethiopia, Fiji, Georgia, Greece, Hungary, Indonesia, Iran, Kenya, Laos, Malaysia, Mongolia, Myanmar, Pakistan, Qatar, Russia, Serbia, Sudan, Switzerland, Thailand, Turkey & United Kingdom (2017), Guiding Principles on Financing the Development of the Belt and RoadEnglish, Chinese

Ministry of Culture (2017),  Belt and Road Cultural Development Action Plan (2016-2020) – Chinese

Guidelines Currently in Development

China Chamber of Commerce of Foodstuffs and Native Produce, Guide for Overseas Investment and Production of Sustainable Palm Oil by Chinese Enterprises (Consultation Draft) – EnglishChinese

State Forestry Administration & China Academy of Forestry, Guidelines for Overseas Sustainable Forest Products Trade and Investment by Chinese Enterprises (Consultation Draft) – English

China Chamber of Commerce of Metals Minerals & Chemicals Importers & Exporters, Guidelines for Sustainable Development of Natural Rubber (Consultation Draft) – EnglishChinese

China International Contractors Association, Sustainable Infrastructure Guidelines for Overseas Chinese Enterprises (Consultation Draft) – EnglishChinese

Voluntary Initiatives

Equator Principles

Extractive Industries Transparency Initiative (EITI)

Forest Stewardship Council (FSC)

OECD Guidelines for Multinational Enterprises

United Nations Environment Programme – Finance Initiative (UNEP FI)

United Nations Global Compact

Roundtable on Sustainable Palm Oil (RSPO)

Other Materials Focusing on Chinese Overseas Standards

Bernasconi-Osterwalder, Nathalie et al., Chinese Outward Investment: An Emerging Policy Framework, Intenrational Institute for Sustainable Development (2013) – EnglishChinese

Friends of the Earth US, Going Out, But Going Green? Assessing the Implementation of China’s Green Credit Guidelines Overseas (2015) – English

Friends of the Earth US, Emerging Sustainability Frameworks: China Development Bank and China Export-Import Bank (2016) – English

Garzón, P., Legal Manual on Chinese Environmental and Social Guidelines for Foreign Loans and Investments: A Guide for Local Communities (Second Edition), Centro de Derechos Económicos y Sociales, CDES (2015) – English, SpanishPortuguese

International Rivers, The New Great Walls: A Guide to China’s Overseas Hydropower Industry (Second Edition) (2012) – English, ChineseSpanish

International Rivers, Guide to Sinohydro International’s environment and social policies in hydropower development projects (2014) – English

International Rivers, Guide to PowerChina Resources’ environment and social policies in hydropower development projects (2014) – English

International Rivers, Benchmarking the Policies and Practices of International Hydropower Companies – Environmental and Social Policies and Practices of Chinese Overseas Hydropower Companies, Part A: Methodology and Analysis – English

International Rivers, Benchmarking the Policies and Practices of International Hydropower Companies – Environmental and Social Policies and Practices of Chinese Overseas Hydropower Companies, Part B: Benchmarking Findings Summary by Company – English

Mekong Watch and 3SPN, Community Guide on China’s Guidelines for Environmental Protection in Foreign Investment and Cooperation (2014) – English, KhmerLaos