Markets working to support sustainable development

Green Watch

The Green Watch program entails the collection of information regarding the environmental performance of companies which are then graded using a colour coding system. This information is then publicly distributed to remove information asymmetries between polluters and groups such as consumers and citizens, hopefully resulting in polluters changing their behaviour.

Businesses are assessed against benchmarks set by the Chinese government in regards to emission and discharge standards that specify effluent concentration limits. Secondary benchmarks are China’s load-based emission and discharge standards. The program incorporates six dimensions of environmental pollution: water, air, noise, solid waste, electromagnetic radiation, and radioactive contamination. Other performance indicators include hazardous waste disposal practices, solid waste recycling, pollution accidents, public complaints, internal management requirements, China cleaner production certificates, ISO 14000 certificates, administrative penalties, and other citations for illegal activity.

Background information: 

The pilot project was developed by China’s State Environmental Protection Administration, with technical assistance, ideas and advice from the World Bank’s Development Research Group. After pilot projects proved successful in 22 Chinese municipalities, the Chinese national government decided in November (2005) to extend GreenWatch to every city in the country by 2010.A 2010 investigation by the World Bank on the performance of the scheme found that Green Watch improved the performance of businesses covered by Green Watch, but that the incentives for producers at different levels of compliance are different and the abatement costs of achieving different levels are different for different firms. 

Funding source: 

China’s State Environmental Protection Administration, The World Bank - by way of Technical Assistance.

Notable information: 

Inspiration for this program comes from Indonesia’s PROPER (Program for Pollution Control Evaluation and Rating).