On April 18, 2024, the Standardization Administration of China (SAC) unveiled a significant initiative with the establishment of the ESG Standardization Project Research Group, henceforth referred to as “the ESG Group.” This development arises from the recognition of ESG (Environmental, Social, and Governance) as a pivotal global framework for sustainable development information disclosure and an essential criterion for enterprises committed to high-quality development.

Comprising diverse stakeholders including research institutions (like the Chinese Academy of Environmental Planning), academic institutions (such as the Capital University of Economics and Business and Tsinghua University), organizational bodies (like the Beijing office of the International Sustainability Standards Board), and corporations (such as the People’s Insurance Company of China), the ESG Group is structured to drive comprehensive engagement. Oversight of its day-to-day operations will be spearheaded by the Capital University of Economics, with support from a convener and deputy convener from the same university and the China National Institute of Standardization (CNIS), respectively.

The primary aim of the ESG Group is to expedite the standardization of ESG practices in China. By doing so, it aims to steer enterprises towards greener, low-carbon trajectories, aligning with the nation’s goals of achieving carbon peak and neutrality. Additionally, the initiative seeks to bolster the integration of Chinese businesses into the global economic framework, thereby enhancing China’s influence in global economic governance.

Key responsibilities of the ESG Group include:

  • Analyzing current domestic and global trends in ESG standardization.
  • Assessing existing ESG standards and anticipating future requirements.
  • Charting a roadmap for ESG standardization, proposing both international and domestic policies, systems, and strategies.
  • Identifying short-term priorities and proposing new initiatives.
  • Offering recommendations for the establishment or refinement of ESG Standard Development Organizations (SDOs).
  • Curating a list of international ESG standards for adoption recommendations.

The ESG Group’s operational timeline spans 18 months, during which it aims to conduct comparative research, develop strategic frameworks, and lay the groundwork for an ESG standardization system in China. This concerted effort is poised to streamline integration into the international arena, facilitating smoother engagement for foreign stakeholders.