(Originally published on 03/16/2016)

A discussion of next steps after the 2015 Report on the Sustainable Development of Chinese Enterprises Overseas at OECD, Paris

Linked to China’s restructuring of its own economy, China is increasing its investment in other countries at a fast rate. Chinese outward direct investment has been rising at an average rate of 36.4% each year since 2000, and with new international commitments through, the Asian Infrastructure Investment Bank, the “Belt and Road” initiative, the New Development Bank of the BRICS, and the Forum of China-Africa Co-operation, Chinese companies are becoming ever more apparent in other countries, especially in developing countries.  Although their presence is welcomed in principle and spirit by many developing countries, on the ground, the experience of these companies, and that of the populations they are engaging with, has been far more complex.  

Indeed, in November 2015, the United Nations Development Programme (UNDP) in collaboration with Chinese Academy of International Trade and Economic Cooperation (CAITEC) under Ministry of Commerce, and the Research Centre of State-owned Assets Supervision and Administration Commission (SASAC) launched a flagship report - the 2015 Report on the Sustainable Development of Chinese Enterprises Overseas, summarising and analysing the largest collection of data relating to Chinese firm’s own perceptions of their environmental, social and economic performance as well as the processes and frameworks they have put in place to encourage responsible behaviour. The report also contained a comprehensive list of the policies and measures that the government has issued to date, and up-to-date data on Chinese investment, projects and people working overseas. 

This week at OECD in Paris, UNDP and CAITEC discussed the key findings and recommendations from the flagship report, and implications for ongoing work by the OECD to support companies from all over the world to improve their impact on sustainable development – such as guidelines for multinational enterprises. 

Participants endorsed the specific recommendations provided in the report for the Chinese government, Chinese firms themselves and host country governments to ensure Chinese firms continue to actively support and pave the way for sustainable development in the future.

They also discussed future opportunities for this research and collaboration to support host country governments and Chinese firms in particular. They agreed that this will be critical to help deliver the United Nations new and transformational Sustainable Development Goals (SDGs), which has also been highlighted as a key priority for the 2016 Chinese Presidency of the G20.  As UN Secretary-General, Ban Ki-Moon noted during his opening speech at the UN Private Sector Forum in September, ‘I am counting on the private sector to drive success’.

Finally, participants gave suggestions for how UNDP, CAITEC and SASAC, can cooperate with OECD Members and others to continue to promote the sustainable development of Chinese enterprises overseas. UNDP drew their attention to a short consultation it is conducting right now together with the Chinese government counterparts, to gather experts’ feedback on the 2015 report and their suggestions for improvements for the 2016 report. The consultation is available for all to contribute to, on an online survey in English or on the UNDP China website, until April 1st 2016.

Overall, UNDP hopes that 2016 will be a crucial year for Chinese enterprises overseas and their sustainability performance, and OECD and other partners will play a strong enabling role for this.

For the OECD guidelines for Multinational Enterprises click here.