China has set new green principles for the China Belt and Road Initiative (BRI). The leading organizations The Green Finance Committee of China Society for Finance and Banking together with the City of London Green Finance Initiative have jointly co-operated in the project.
The aim of the principles is clear: to foster environmental issues and sustainability in the area and to foster environmental, social and governance risk factors into decision-making processes and conduct due diligence and develop risk mitigation and management plans with the help of independent third-party service providers.
The organizations will also disclose environmental information and greenhouse gas emissions (GHG), water use and deforestration. One of the reporting models will be the Task Force on Climate-Related Financial Disclosure.
The companies are also encouraged to have more communications with different stakeholders and use modern, green finance instruments like green bonds and green asset backed securities in financing the green projects.
According to the principles, the companies will also adopt green supply chain management and integrate ESG factors into the supply chain. The principles are voluntary, but the signatories are expected to adopt and apply these in their investments and operations in the area.
The ancient Silk Road is the of the major infrastructure projects in Asia, which is promoted by the Chinese Goverment.