2Sustain

Without question, greenwashing is a problem in the U.S. But, in China, companies seem to be taking it to a whole new level. Rebecca Kanthor’s recent article  for CHaINA Magazine offers nothing but straight-talk about what “green” means in corporate China, and the details she uncovers are eye-opening, to say the least.  According to Kanthor, “greenwashing, outright lies, and fake documents” are part and parcel of so-called “green” supply chain management there.

The article, “Green or Green Washed? 7 Lessons in Green Supply Chain Management,” outlines seven “dirty secrets,” of green supply chain management in China, and Kanthor includes several key insights from Ma Jun, one of China’s most prominent environmentalists and director of the Institute of Public and Environmental Affairs. Here’s a particularly relevant excerpt from “Lesson 5: The system of accountability doesn’t work:”

Speaking from years of experience dealing with suppliers and client companies, the director maintains that most companies pressure their suppliers for the cheapest price and then expect compliance on environmental standards. Suppliers are struggling to survive and don’t want to lose money either, so they satisfy their client companies with fake documents. When scandal breaks, companies blame their suppliers for lying to them. As it did in 2007 with a rash of tainted product scares and more recently with reports of tainted drywall, the blame goes to Made in China, and not Poorly Managed Supply Chain.

Even if a company does put pressure on its suppliers to adhere to environmental standards, oftentimes lack of follow-through on these standards leads to a chain of fakes and lies.

According to Pierig Vezin, CEO of Wethica, which conducts long-term social responsibility audits forclient companies, it’s absolutely unrealistic to expect suppliers to measure up to client company’s standards. “If you ask a factory to be 100% compliant,” he says, “you ask it to kill itself.”

“There is really a faking business,” he says.“You have some buyers who want to buy in fully compliant factories. You have some factories that have become experts in making fake documents, in teaching the workers how to answer the auditors. And you have some auditing companies that have become expert at the way to say things that leads [to] ‘ok this factory is compliant,’ even if they haven’t said it really.”

Even so, Kanthor is careful to mix in a few glimmers of optimism, as well. Transparency, for instance, is developing, thanks in large part to air and water pollution data collected by Ma Jun’s Institute of Public and Environmental Affairs. In addition, she says more and more companies are realizing that green is a smart long-term solution, and many are showing a willingness to improve.

“I think that in the end customers that are prioritizing are very savvy, because it does eliminate costs but it also helps them with their brand,” says Paul McCann, Director and China General Manager of Smurfit-Stone, a US company providing packaging solutions for companies manufacturing in China. “As you talk about positioning a brand to a next generation of consumers, it’s very smart.”