In the run up to the UN’s COP26 climate talks, China’s President Xi Jinping pledged that China would stop building new coal-fired power projects abroad – a significant commitment as China has been one of the biggest public financiers of new coal plants both overseas, and at home.
China is the world’s second largest economy, and is thought to be the largest greenhouse gas emitter. The Rhodium Group estimates that China was responsible for 27% of global greenhouse gas emissions in 2019, with coal-fired power generation still accounting for around 50% of its energy mix.
It is certainly ambitious for China to achieve net zero by 2050 but it is not an impossible task. To actually deliver on its commitment to the Paris Agreement, China’s power and heavy industry sectors must adopt a decarbonisation strategy immediately and limit the use of coal.
We are engaging with Chinese and Hong Kong companies on establishing targets and plans for reducing greenhouse gas emissions in line with the Paris Agreement. We have included a climate change voting policy in our Corporate Governance Principles for Mainland China and Hong Kong, and we communicate our expectations with companies identified as climate change mitigation laggards.
This article will appear in our Q3 2021 Public Engagement Report.