Advancing the Sustainability Practices of China’s Transnational Corporations

The document argues that for China to transition into a major global economic player, its businesses must move beyond legal compliance to embrace voluntary sustainability standards. It identifies a current trend of avoidance among CTNCs due to unfamiliarity and perceived Western bias, which risks damaging 'Brand China'. The authors propose a strategic framework—normalization, exceptionalism, and transformation—to help CTNCs and the Chinese government decide whether to ignore, mitigate, leverage, or promote specific standards to move up the global value chain.

• Chinese transnational corporations (CTNCs) often avoid voluntary sustainability standards due to a lack of familiarity with the rules, weak networks with relevant organizations, and insufficient guidance from the Chinese government, particularly for state-owned enterprises.
• The authors propose three strategic pathways for China's response to sustainability standards: Normalization (compliance with existing standards), Exceptionalism (opting out to use tailored domestic standards), and Transformation (actively reshaping international standards).
• China ranks 87th in the Responsible Competitiveness Index, lagging behind other BRICS nations (Brazil, Russia, India, and South Africa), specifically scoring poorly on 'social enablers' which hinders CTNCs' ability to engage with civil society in international markets.
• Sustainability standards can act as non-technical barriers to trade because they are largely dominated by Western businesses and civil society organizations from Europe and North America.
• In the forestry sector, China has adopted a 'join and promote' approach, with the Forest Stewardship Council (FSC) becoming the fastest-growing forestry certification scheme in the country as of September 2008.
• The textile sector has developed the CSC9000T, a voluntary management system for CSR, which is the first of its kind in China to be recognized by international buyers and standards groups.
• CTNCs face significant 'soft competitiveness' challenges, including discrimination in the U.S. market and skepticism regarding whether state-owned enterprises are driven by economic profit or political objectives.
• The document recommends that the Chinese government incentivize sustainability by offering preferential income tax arrangements, public funding through investment funds, and access to foreign-exchange reserves for companies embedding sustainability strategies.

APA

Guoqiang, L., Zadek, S., & Wickerham, J. (2010). Advancing the Sustainability Practices of China’s Transnational Corporations. International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/advancing_sustainability_corp.pdf

Chicago

Guoqiang, Long, Simon Zadek, and Joshua Wickerham. Advancing the Sustainability Practices of China’s Transnational Corporations. International Institute for Sustainable Development, 2010. https://www.iisd.org/system/files/publications/advancing_sustainability_corp.pdf.

Wikipedia

{{cite report |last1=Guoqiang |first1=Long |last2=Zadek |first2=Simon |last3=Wickerham |first3=Joshua |title=Advancing the Sustainability Practices of China’s Transnational Corporations |publisher=International Institute for Sustainable Development |date=March 2010 |url=https://www.iisd.org/system/files/publications/advancing_sustainability_corp.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{guoqiang2010advancing, author = {Guoqiang, Long and Zadek, Simon and Wickerham, Joshua}, title = {{Advancing the Sustainability Practices of China’s Transnational Corporations}}, institution = {International Institute for Sustainable Development}, year = {2010}, month = mar, url = {https://www.iisd.org/system/files/publications/advancing_sustainability_corp.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }