China and Sustainability Governance
05 April 2019

China’s Engagement in Private Sustainability Governance

Over the last two decades, non-state actors have launched many governance initiatives to reduce negative environmental and social impact of global markets. To what extent, and under what conditions, can private sustainability governance gain traction in China, a country known for the scale of its economy and for its authoritarian regime, seemingly incompatible with private authority? Yixian Sun explored this surprisingly understudied issue in his recent PhD thesis, on which he gives us more details.

Where does your interest in private sustainability in China stem from?
As a Chinese student of international relations, I am always interested in the changing role of China in global governance. A nascent trend in global governance is the rise of codes, regulations and standards created by nonstate actors, including businesses and NGOs, to promote socially responsible products and services without state enforcement – a phenomenon that scholars often call “private sustainability governance”. While there is a growing literature to examine the emergence and expansion of various private schemes, to date comprehensive research on large emerging economies, especially China, is still missing despite the country’s impact on global economy and ecology. If private governance cannot thrive in China, it can only make little contribution to global sustainable development, and ultimately to saving our planet. Moreover, political scientists generally believe that in authoritarian China, the state would leave little space for private governance as it wants to maintain the rule-making authority. But recent data show that more and more Chinese businesses are compliant with private rules and standards. Hence, a puzzle seems to emerge here as new developments on the ground do not follow the conventional expectation. All these unsolved questions led me to study private sustainability governance in China, and I zoom in on the case of eco-certification (or eco-labels) as it is among the most institutionalised models of private governance. 

What methodology do you use to approach those questions?
I apply a political economy approach to examine the diffusion of transnational certification programmes in China. I first develop a new model that identifies key stakeholders, their interests and the dynamic interactions among them in the diffusion processes. While past studies have mainly highlighted the influence of Northern buyers and investors in introducing private governance to their Southern suppliers, my model indicates the important role played by domestic state actors to generate businesses’ incentives to adopt new rules. To test the hypotheses derived from my theoretical model, I then study three of China’s agri-food value chains: seafood, palm oil and tea. These three sectors were selected not only for the significant sustainability challenges they face, but also for their variation in market and governance structures that are likely to shape different diffusion pathways. My empirical research integrates analysis at both the sectoral and firm levels to show the forces driving business support for eco-certification. It draws on original data gathered from in-depth fieldwork including over 100 interviews and two datasets of firm surveys. Methodologically, I adopt a mixed-method approach, using methods ranging from comparative case studies and process tracing to multivariate regression and survey experiments.

What are your major findings?
In opposition to most existing studies, my analysis finds that in the Chinese context, domestic state actors – including regulatory agencies and government-sponsored industry organisations –have been the main driver of the expansion of private governance. In other words, far from challenging state authority, Chinese officials have strategically engaged private governance to pursue their own development goals in ways that reinforce the development of a strong and authoritative state. My analysis details the interaction mechanisms between transnational and domestic actors, and therefore challenges the conventional wisdom that the Chinese state has little interest in supporting private sustainability governance. It also shows that divergence among these cases can be traced back to the different roles that relevant domestic regulators have envisioned for their sector.

What could be the social implications of those findings?
The most important implications of my thesis concern the insights into the promise and limits of private sustainability governance in China, or emerging economies more broadly. On the one hand, leveraging domestic state actors can effectively increase the uptake of transnational rules for sustainable production and consumption in emerging markets like China. Such influence of the state on private governance illustrates the blurry and fluid boundary between “state” and “non-state” actors in China, which spurs further reflection on the “private” nature of private governance when the relevant initiatives are operated in different governance systems. On the other hand, private certification has only reached a very small group of businesses in China, reinforcing power imbalances in supply chains by favouring large, capital-intensive production. Such very limited impact again casts doubt on the actual social and environmental gains from the relevant private regulatory tools, implying the need for designing better institutional arrangements to solve urgent sustainability problems that Earth is facing.

What are you doing now?
I am a Postdoctoral Fellow at Yale University thanks to the financial support of the Swiss National Science Foundation. At Yale School of Forestry and Environmental Studies, I continue my research on global environmental governance, with a focus on the interaction between private regulations and public policies. In addition to turning my thesis into a book, I have started with my colleagues at Yale and other collaborators several projects on land-use governance as land-use change has been a major source of carbon emissions and environmental degradation. I am also starting a new book project on governance of the global tea value chain by studying the three largest tea producer countries – China, India and Kenya. 

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Yixian Sun defended his PhD thesis in International Relations/Political Science in November 2018. Assistant Professor James Hollway presided the committee, which included Professor Liliana Andonova and Associate Professor Thomas Hale from the Blavatnik School of Government of the University of Oxford, thesis codirectors, and Associate Professor Jörg Balsiger, from the Department of Geography and Environment of the University of Geneva.

Full citation of the PhD thesis:
Sun, Yixian. “Beyond the North: The Diffusion of Private Sustainability Governance in China.” PhD thesis, Graduate Institute of International and Development Studies, Geneva, 2018.

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Interview by Nathalie Tanner, Research Office.
Illustration by zhu difeng /