Aarhus Convention Working Group: Promoting Transparency and Sustainable Finance

BEIJING (Oct. 15, 2016) – A modern Chinese tale has it that only the true lovers will meet on a heavily polluted day.

On October 15, the AQI in Beijing topped out at 240. While love and PM2.5 was in the air, GEI and the International Institute for Sustainable Development (IISD), along with representatives from public interest groups, researchers, and consultants, gathered to discuss how to promote sustainable finance and investment. Specific topics covered were environmental information disclosure and how to increase the transparency of businesses and financial institutions.

Setting up an Environmental Database to Promote Green Decision Making WANG Mingxuan from the Center for Public Environmental Studied (IPE), explained IPE’s continuous efforts since 2006 to establish a corporate environmental information disclosure database and its goal to promote environmental information disclosure and public participation.

After ten years of development, IPE’s environmental database now includes more than 280,000 corporate environmental regulatory records and 50 large international and domestic brands, which continue to utilize IPE’s databases to manage their suppliers in China. For example, Apple regularly refers to the database to promote the suppliers, such as upstream electronics and screw factory to rectify their inappropriate management of wastewater discharge; these actions just led the company to be IPE’s number one Green Choice in the IT Industry.

In 2013, IPE also launched the Green Securities Project, which focuses on the heavily polluting industries to analyze the listed companies as well as their investors and affiliates. Through disclosing the emissions violations of listed companies and related firms on the online database, IPE instructed for 30 companies to make complete rectifications of their emissions.

Mingxuan pointed out that on August 31 seven ministries jointly issued the Guidance on Building a Green Financial System, and stressed that the “green financial system needs to solve the information asymmetry problem facing green investment and finance along with other issues.” While the systematical disclosure of environmental information is the key to solve this problem, which can be widely used in key areas throughout of green finance:

To further play the role of environmental information disclosure in the development of green finance, IPE Blue Map App database will add a new interface for users to look at financial institutions. This is certainly an exciting extension of the APP!

“The Aarhus Convention”: Cornerstone of international law on the disclosure of environmental information

The Aarhus Convention, the full name of which is the Convention for the Access to Information, Public Participation in Decision-Making, and Access to Justice in Environmental Matters, was established by the United Nations Economic Commission for Europe (UNECE). GEI Program Officer, ZHU Rong, traveled to Geneva, Switzerland to attend to the Aarhus Convention Working Group meeting and was able to share her first-hand experience of the Aarhus mechanism at this symposium.

The Aarhus Convention went into force on October 30, 2001 and currently has 47 parties, all of which are UNECE members, including 46 countries and the European Union. The three main pillars of the Convention ensure that the public has three rights over environmental issues:

The Convention outlines responsibilities that the Parties must fulfill regarding these three areas and provides corresponding guidance for implementation:

• Adopting the legislative and other measures necessary to establish and maintain a clear, transparent and coherent framework for the implementation of the provisions of the Convention.
• Ensure that officials and departments at all levels assist and guide public access to information on environmental issues, facilitate participation in decision-making and access to justice and promote environmental education in the general public.
• Promote the application of principles both within the international environmental decision-making process and within the framework of an international organization dealing with the environment; ensure that the person exercising their rights under the Convention are not subjected to any form of punishment, persecution or harassment.
• Give appropriate recognition and support to associations or groups advocating environmental protection and ensure that the national legal systems are in compliance with this obligation.
• In the context of the relevant provisions of the Convention, the public shall be able to obtain information, participate in decision-making and access to the law on the environment without any discrimination based on citizenship, nationality or residence.

The Aarhus Convention provides an important reference for the development of sustainable finance and investment. Multilateral financial institutions, including the World Bank, the European Investment Bank and the European Bank for Reconstruction and Development, have developed their environmental policies with reference to the Convention. The Convention also provides the principles and tools for environmental monitoring for multi-stakeholder groups including NGOs.

With the promotion of the “One Belt, One Road” initiative, a growing number of Chinese enterprises, financial institutions, and NGOs will travel to Central Asian and European countries. As such, the Aarhus Convention and relevant national frameworks will provide a reference for their environmental work.

GEI’s Point of View: The promotion of sustainable finance and investment is inseparable from environmental information disclosure and transparency. At present, China’s environmental information disclosure system mainly adopts voluntary disclosure, and the quantity and quality of important information are still relatively low compared with the international level.

We hope that in the future, China could look toward the international advanced practices in terms of policies and tools to strengthen environmental disclosure and transparency of financial institutions and enterprises at home and abroad. In this way, China can make its financial and investment activities greener and more sustainable.

Tips for Environmental Information Database

Scan the QR codes below to check-out the 173 well-known enterprises’, such as Apple, environmental performance ranking, and search the world’s fresh water, forests, carbon emissions, protected areas and other environmental information. Information on the UNEP environmental information database can also be downloaded in the form of maps, charts, data sheets, etc.

About the “Sustainable Finance and Investment Symposium”

At the beginning of this year, eleven non-governmental organizations, such as the Global Environmental Institute (GEI), and the International Institute for Sustainable Development (IISD), formed the Sustainable Finance and Investment Working Group. The Working Group is committed to pooling the concerns and knowledge of the agencies and promoting the sustainable finance and investment agenda in international dialogue platforms like the Group of Twenty (G20) and BRICS.

As of September, the Group’s G20 advocacy work achieved initial results when the group’s Recommendations for Sustainable Finance and Investment were successfully incorporated into the G20 Civil Society (C20) Communique. Building off this success, GEI and IISD will hold three “Sustainable Finance and Investment Symposiums.” Each symposium will invite the working group partners, enterprises, and academic friends together to discuss policy promotion, system innovation, tools to promote sustainable finance, investment philosophy and practice.

Two more sessions will be carried out soon, so please stay tuned.