In recent years, China has taken important steps to improve environmental governance. One of the most notable reforms is the nationwide rollout of corporate environmental information disclosure. Behind this shift lies a combination of policy evolution, institutional momentum, and a body of research that helped inform and support the process.

EfD Researchers Bing Zhang, Jintao Xu, and co-author Liu Mengdi have conducted research on the effects of environmental disclosure for many years, combined with extensive engagement with policymakers. They were recognized with the 2025 EfD Policy Impact Award. Their work has contributed valuable insights into how transparency can enhance accountability in environmental governance.

60 percent drop in violations

The research began with a practical question: Can making pollution data public improve environmental outcomes? To explore this, they conducted a series of large-scale randomized controlled trials (RCTs) and field experiments across China. These studies were designed to understand how different actors – citizens, firms, NGOs, and government agencies – respond to environmental information when it’s made accessible.

“First, we found that bottom-up accountability occurs when the public has access to environmental information,” explains Bing Zhang. The visibility of the public’s engagement is also important: One experiment found that public complaints posted on social media led to a 60% drop in pollution violations, while private complaints through official hotlines had a limited impact.

This visibility also shifted the focus from favoring the growth potential of firms to addressing environmental protection.

NGOs play important role

Another study examined how NGOs used disclosed data to pressure firms. When NGOs signaled their intent to publicize violations, firms improved compliance, suggesting that, in addition to regulatory pressure, reputational concerns also matter.

This form of horizontal accountability, where civil society complements formal regulation, proved particularly effective in regions with weaker capacity to enforce regulations. The study also showed that firms with political connections were more concerned about the reputational damage, while those with fewer political ties were instead more sensitive to following the regulations.

“This finding suggests that pressure from NGOs can be a complement to formal regulations,” says Bing Zhang.

Streamlining central and local enforcement

A third strand of research focused on top-down accountability, that is, disclosing how well local governments complied with central mandates. The researchers observed substantial improvement in transparency, suggesting that the central government can leverage NGOs’ monitoring to enhance environmental control while reducing its own monitoring costs. Combined, all these findings show that transparency is a powerful environmental policy instrument in decentralized political systems.

From findings to frameworks

The researchers' impact extended beyond academia. Through long-term and in-depth engagement with China’s Ministry of Ecology and Environment (MEE), the team submitted influential policy recommendations, participated in high-level policy conferences, and drafted key regulatory documents.

Their report, Assessment and Institutional Research on Environmental Information Disclosure by Listed Companies, was officially recognized by the MEE and helped inform the development of several landmark policies. These included the 2021 Management Measures for the Legal Disclosure of Enterprise Environmental Information, which expanded the scope of regulated entities, standardized reporting formats, and introduced a centralized disclosure platform.

This reform was driven by interacting factors, such as the State Council’s push for “modern environmental governance,” international ESG (Environmental, Social, and Governance) norms, and financial sector demands for transparency. The researchers’ work aligned with these broader trends and provided empirical support for policy choices.

Extensive implementation

Today, over 80,000 enterprises and institutions in China are required to disclose environmental information. Each province operates its own platform for environmental information, but the systems are harmonized, allowing for cross-regional access and comparisons. Enterprises report annually, and those with real-time monitoring systems share pollution data continuously.

“The reform has improved oversight efficiency, supported green finance initiatives, and encouraged industries to self-regulate. Environmental data is now integrated into financial credit systems and supply chain evaluations,” says Bing Zhang.

By the end of 2023, nearly all of China’s 337 prefecture-level cities had disclosed enterprise lists for environmental reporting, with many achieving full compliance and demonstrating the reform’s broad reach and feasibility.

Footnote: This project and the research that supports it were conducted while China was still an EfD center.