More China Companies Are Going Green

By JASON DEAN
BEIJING -- Chinese entrepreneurs and private citizens are starting to become more active in trying to address concerns over global warming, a nascent trend that could have significant long-term impact on the ability of the world's largest greenhouse-gas emitter to curb its effects on the climate.
The shift is most pronounced among a small-but-growing group of private business executives, who are adjusting their business practices and helping to spread awareness more broadly among the public.
Wang Shi, the 58-year-old chairman of China Vanke Co., the country's largest housing developer, said he became concerned about global warming through mountain climbing, a hobby he took up in 1998. He had read the Ernest Hemingway story "The Snows of Kilimanjaro," and in 2002 went to Tanzania to scale the mountain in the title. He was surprised at what he found.
"I didn't see any snow," he says. "I did more research, and discovered that within 50 years...its glaciers could be entirely gone as well."
Mr. Wang is gradually replacing wood used in the interiors of Vanke's apartment buildings with recyclable materials. Vanke is using more solar and other renewable energy, and adopting prefabrication techniques, borrowed partly from Japan, that are less wasteful than standard Chinese construction.
Mr. Wang is building a new corporate headquarters in Shenzhen designed by Steven Holl, an American architect, that he aims to make the first building in China with a platinum ranking -- the highest available -- on the international Leadership in Energy and Environmental Design rating system for "green buildings."
"China is a big country," says Mr. Wang, who founded Vanke 25 years ago. "It should try to shoulder the responsibilities of a large country, and therefore China's companies need to shoulder their own responsibilities."
In 2004, Vanke's Mr. Wang and about 60 other businessmen founded the Society of Entrepreneurs and Ecology to promote awareness and action on climate change and other environmental issues. It now has 160 members, each of whom pays 100,000 yuan ($14,620) in annual dues. That means an annual budget of at least $2.3 million, not including other contributions like free rent -- a hefty sum for a Chinese NGO.
SEE uses the funds for reforestation programs in China and educational efforts, and to help support more than 150 smaller environmental groups around the country.
On Dec. 8, at the beginning of the Copenhagen climate summit, the group joined several other organizations representing 200 business members to issue a communiqué pledging to reduce their companies' emissions and calling on governments to reach a deal including binding legal benchmarks.
Yang Peng, SEE's secretary-general, says the growing green consciousness is a natural outgrowth of China's development.
"In the past, people just wanted to get enough to eat. Now, many people live in nicer homes, and they're more concerned about the environment," he says. "Low carbon is a new idea, but it's spreading very fast."
Most of the focus in assessing China's climate-related practices has been on the government. That is logical, since Beijing, in addition to setting policy, plays an enormous direct role in the economy. The government has pledged to reduce China's carbon emissions relative to the size of its economy, but has refused to commit to outright emissions cuts. Some foreign officials and scientists have criticized China's stance and said it contributed to the failure of the Copenhagen summit to reach a breakthrough. China says it played a constructive role at the summit, but can only agree to a deal that treats developing nations fairly.
But the participation of private businesses and regular citizens in the world's most populous nation will also be a major factor in China's climate impact.
Until recently, there was little of the sort of nongovernmental activity on climate change and other environmental issues that is common in more-developed places like Europe, Japan and the U.S. Now, climate experts take heart in the increasing activities of some executives, educators and others -- even if it is too early for them to have had major impact, and abundant examples remain of indifference and waste.
"We are starting to see a growing level of awareness of climate change among people" in China, says Barbara Finamore, China program director for the Natural Resources Defense Council, a New York-based environmental organization. Ms. Finamore points to educational efforts in schools and by the state media to make people aware of climate issues, as well as "forward-looking companies who recognize the importance of this issue and are taking a leading role in trying to encourage their government to do more."
Some executives are changing their personal, as well as corporate, behavior. Zhang Yue, chairman of Broad Air Conditioner Co., was one of China's first entrepreneurs to buy a private jet, back in 1997. About five years ago, he became aware of the huge volume of carbon dioxide produced by a single 1,900-mile trip on the jet. Since then, he has heavily restricted the jet's use, and he often takes commercial flights.
Mr. Zhang has also made emissions reduction a central mission of his company. Broad is a major producer of giant air conditioners used in buildings, and it specializes in chillers that don't use electricity, instead relying on other energy sources like natural gas and waste heat. Broad says its air conditioners have only 20% the carbon-dioxide emissions of electric models.
Still, Mr. Zhang, who considers himself a pioneer on climate-change issues in China, is pessimistic about the overall level of awareness in the country.
"Public understanding of energy conservation and emissions reduction is still woefully behind," he says, adding that more education and publicity of the issue by the government is needed.
Others see progress already. Huang Ming, the chairman of Himin Solar Energy Group Co., China's largest maker of rooftop solar water heaters, says the desire among some of his customers, particularly educated, urban residents, to use more-environmentally friendly devices is helping to boost Himin's sales.
If property companies like Vanke change their behavior, it could have an especially strong impact, since China has the largest building market in the world by floor space. Building operations create about one-sixth of China's total carbon emissions, according to the China Greentech Report 2009, published by a business consortium.
A separate report in October by the NRDC and Boston Consulting Group estimated that "moderate" energy conservation, affecting 5% of China's existing buildings and 60% of new buildings, would have an environmental impact equivalent to halting global air traffic for four months.
Write to Jason Dean at jason.dean@wsj.com