On November 26, 2024, the 3st Sino-European CSR Roundtable Forum, organized by amfori and China Sustainability Tribune, was held in Beijing.

Focusing on “the Influence and Trend 0f Green Policies on Supply Chains,” the forum invited sustainability experts, industry association representatives, Chinese and European enterprises and other ecological partners to discuss the impact of green policies, regulations and standards on the global supply chain, and share the latest policy interpretation on the recently concluded the 29th session of the Conference of the Parties (COP29).

Global Trade Sustainability

In her welcoming address, Linda Kromjong, President of amfori, cited relevant European green policies and pointed out the significant role of green supply chains in addressing the challenge of climate change. "Europe and China share a common understanding in promoting global green policies for more sustainable and transparent supply chains," she said. Green policies are not mandates or constraints -they are opportunities.They empower and encourage businesses for innovation, growth, and resilience, giving businesses a framework to operate responsibly.

For example, theEurope's Corporate Sustainability Reporting Directive (or CSRD), and the EU's Corporate Sustainability Due Diligence Directive, in short CSDDD, bothare anchored in the same principles of supply chain transparency, accountability and continuous improvement. They encourage companies to improve sustainability in their supply chains, operate in fairer market conditions and improve their resilience overtime, which is significant to jointly promoting global green supply chains.

“Green development is the prerequisite for high-quality development and the bedrock for new industrialization.” After witnessing the achievements the forum has accumulated over the years, Guo Xiuming,Executive Deputy Director of the CSR Committee of the China Electronics Standardization Association, said: “The Sino-European CSR Roundtable Forum, which has been held for 16 years, is indeed a miracle embodiment of sustainable development itself. The organizers of the forum are amfori (formerly known as Foreign Trade Association) and China Sustainability Tribune. Their names together happen to be ‘Global Trade Sustainability’. All of us here are the pacesetters who have tirelessly promoted corporate social responsibility over the years!”

The Impact of Latest Green Dynamics on Supply Chains

After experiencing the “sustainability feast” in Baku, Chai Qimin, Director of the Strategic Planning Department of the National Climate Strategy Center, shed light on the “COP29 and Green Transformation of Global Supply Chains”.

“COP29 has achieved incremental results, especially in terms of the New Collective Quantified Goal (NCQG) and carbon markets. Green and low-carbon development is unstoppable. Undoubtedly, net zero emissions will become an important new rule for global industrial investment in energy markets, capital flows, and international trade. It will have a significant impact on future development. In response, China is steadily and actively promoting energy transition investment, new energy investment, green finance, and the national carbon market which has been launched in recent years.”

The increasingly accelerating response to climate change has not only brought about new rules and policy changes in trade and investment but also driven more brands to engage in the green transformation of supply chains. Mr Chai said that carbon footprint is one of the critical systems in the supply chain. By looking at carbon emissions in the supply chain, we can often gain more insights. For example, we can optimize the whole process from supply to demand to reduce carbon emissions.

“Financial instruments are very important in today’s green competition. Finance is also a key part of market progress,” saidAndrew Harding, Chief Executive of Management Accounting at the Association of International Certified Professional Accountants (AICPA & CIMA). He briefly introduced the ISSB standards, CSRD, CSDDD, the EU’s Carbon Border Adjustment Mechanism (CBAM), as well as China’s Corporate Sustainability Disclosure Standards, including how to integrate ESG disclosure into corporate governance.

He also showed the prospect of applying artificial intelligence (AI) in ESG and how this will change future working patterns. He said: “ESG and AI are now the two buzzwords. AI will boost ESG and present a new ESG landscape.”

“The European Green Deal is a structured set of policies and regulations that we can’t interpret in isolation,” said Liu Yifang,Director of the Sustainability Standards Research Center at the Central University of Finance and Economics. She provided deep insights into the European Green Deal, including its ongoing extensions, rigorous requirements for corporate sustainability standards, and the importance of just transition and sustainability information disclosure.

She pointed out that Chinese companies entering EU markets need to pay attention to the EU’s strict legislation on sustainability information disclosure and take the initiative to address compliance costs and security risks.

“The power industry can provide vital support for carbon accounting with its unraveled capabilities to collect a wide range of data, and to perform and automate the process.” Zhou You, asenior engineer from the Science and Digitalization Department of State Grid Suzhou Power Supply Company (State Grid Suzhou), shared about carbon footprint management.

In response to the technical, platform, and business challenges concerning carbon footprint management, State Grid Suzhou has developed a new and holistic carbon business format by focusing on carbon footprint services. It has launched initiatives such as building a real-time carbon accounting platform across cloud and edge environments, amassing a carbon footprint database, and extending the four services (carbon verification and certification, carbon inclusive trading, carbon reduction, and carbon finance).

Through vivid cases, he demonstrated the positive role that carbon footprint management plays in boosting corporate energy efficiency and empowering the green development of supply chains.

Supply Chain Risk Management and Opportunities Under Green Policies

During the panel discussion, four panelists delved into how businesses should interpret green policies, foster more collaboration and synergies across supply chains, and develop a green supply chain management system.

Feng Xiangzhao, researcher of China Center for Information Industry Development, noted that electronic information companies should take green policies differently according to their scales and categories. The new energy businesses in particular, who are presented with policy changes when entering overseas markets, need to make adjustments in their supply chain management systems and address the challenges through technological transformation and digital empowerment.

He suggested that leading companies should take the lead in benchmarking with global best practices. They should wield their influence or communicate relevant requirements to drive small- and medium-sized enterprises (SMEs) to learn by doing, thereby enhancing the green capacity of the entire supply chain. Meanwhile, businesses should pay attention to carbon accounting and data management capability building.

Coco Liu, CSR and Sustainability Head for the Greater China region, Philips China, shared about Philips’ experience and reflections on green development. Philips has achieved full operational carbon neutrality and is the world’s first health-tech company to achieve an overall reduction in Scope 1, Scope 2, and Scope 3 carbon emissions. She believes that sustainability is a crucial productive force and that businesses should integrate ecological design into product design and use an Environmental Profit and Loss Statement (EP&L) to measure the benefits and losses of products throughout their life cycle.

She also made a vivid analogy between big trees and lead firms on the way to green transformation. On the one hand, “the big trees offer good shade.” The lead firms, like big trees, offer support for other companies throughout the supply chain to pursue common development and green transformation. On the other hand, “no grass grows under big trees.” The transformation of the supply chain can not be brought by the changes in an individual alone, but by the changes in the whole.

Sabrina Zhang, Founder and CEO of Smartesg, stressed the significance of digitalization in green supply chain management. Digitalization can help address the hassles such as onerous statistical workload and data inaccuracy, and improve the efficiency and accuracy of data management. She advised companies not to exaggerate the challenges or strive for perfection. She also noted that qualitative data was equally important, such as the improvement of the governance structure and the clarification of responsible bodies.

She underscored that in addition to a positive response, companies should embrace these strategies in an effort to develop a green supply chain — the easier tasks first, from upstream to downstream, digital and intelligent empowerment, overall planning, and diversified partnerships.

Aaron Peng, Partner and General Manager of SynTao Consulting Beijing Office, highlighted the challenges companies have encountered in promoting green supply chain management and the possibility of delivering more brilliant solutions. The misunderstanding of green policies among businesses and the wide gap between theoretical standards and practice make it difficult for companies to properly navigate the challenges.

He advised companies to reinforce learning and understanding of green policies first before making iconic breakthroughs with pilot programs to explore a path with minimal input and more effective output.

After listening to the sharing from the panelists, Linda Kromjong felt really resonated. She said: “Fortunately, we are not alone in our efforts to combat climate change. The China Sustainability Tribune and the amfori have been co-hosting the Sino-European CSR Roundtable Forum for 16 consecutive years. With years of collaboration, we are inspired to strive towards the same goal, even though we come from different backgrounds, countries, and industries.”

Yu Zhihong, President and Editor-in-chief of the China Sustainability Tribune, also acknowledged the value of the forum. He said: “It is incredibly rare for a forum to keep running for 16 years and keep focusing on supply chain management. Over the past 16 years, China Sustainability Tribune and amfori have worked together all the way to ensure the professionalism, pragmatism and foresight of the forum, and to keep focusing on trending topics in global supply chain management.”

After an afternoon of sharing and exchange, he made a summary about the trend of green policies and the characteristics of green supply chains. The green policies are substantial in volume, stringent in content, and urgent in release, while the green supply chains are complicated involving multiple scenarios. When it comes to the path, digitalization plays an important role. He said: “Digitalization doesn’t live in tomorrow. It may make a big difference in every single moment of now.”

The Sino-European CSR Roundtable Forum

As a professional and practical communication platform and channel for corporate social responsibility, the Sino-European CSR Roundtable Forum has focused on topics such as " carbon reduction partnership in supply chains," "ESG and supply chain management," and " women empowerment in global supply chains." These discussions have consistently promoted the sustainable China-Europe supply chains.

Since 2008, the Forum has been successfully held for 31 times, with 260+ Chinese and European speakers sharing their views, 2,500+ representatives participating in the Forum in-person, and 100,000 to 300,000 representatives attending on-line each session, covering more than 10 countries in Europe, North America and Asia. The forum has shared the insights of guest speakers, launched research reports, and released corporate practices, shaping a significant partner network and vast pool of experience, and creating a powerful engine for the sustainable supply chains.