Sinopec Shanghai Petrochemical cited for Chinese environmental violations

02-Apr-10

Sinopec Shanghai Petrochemical Co. is among the 175 Hong Kong-listed companies cited for Chinese environmental violations as per data compiled by Institute of Public and Environmental Affairs, highlighting abuses of air emissions and waste-water discharge. In 2008, Sinopec paid US$2.9 mln in fines and fees for waste discharge. The institute seeks to raise shareholder awareness through improved transparency of the risks companies face with their environmental practices. The report calls on Hong Kong stock regulators to push companies to improve disclosure, which should be applicable to companies applying for initial public offerings in Hong Kong. China faces very serious water pollution challenges. It is home to 16 of the world’s 20 most-polluted cities, according to the World Bank, and the government is clamping down on environmental compliance. China is the world’s largest emitter of green house gases and has pledged to reduce carbon-dioxide output per unit of gross domestic product by as much as 45% by 2020. The World Bank estimates the health costs of air and water pollution in Asia’s fastest-growing economy are equivalent to about 4.3% of GDP. A looming water crisis in China could imperil the country’s rapid economic growth unless scarcity and pollution problems are tackled, according to Asia Water Project report.