Takeaways

• Record applications for the EUCCC Sustainable Business Awards highlight deeper ESG integration by European firms operating in China.
• While ambition is strong, companies still face major challenges in supply-chain emissions, financing, and renewable energy access.
• EU-China cooperation on sustainability remains aligned despite regulatory and infrastructure hurdles.

European companies operating in China are stepping up their environmental, social, and governance (ESG) efforts, as reflected in a record number of applications for the European Union Chamber of Commerce in China’s (EUCCC) 2025 f Awards.

The EUCCC received 78 applications from 40 European companies this year, the highest number since the awards program was launched in 2017. The milestone comes as China and the European Union mark 50 years of diplomatic relations, underscoring the growing importance of sustainability collaboration between the two economies.

The awards were presented at a ceremony in Shanghai on December 11, attended by more than 120 executives, diplomats, and sustainability experts. Winners included Bosch China for the China-Europe partnership, Boehringer Ingelheim for talent empowerment, and BMW China and IKEA China for circularity initiatives. Other companies recognized for their ESG performance were Novartis China, Pirelli, and Henkel.

Read More: Top 10 Sustainable Businesses: Inspiring Practices for 2025

Speaking at the event, Carlo D’Andrea, vice president of the EUCCC and chairman of its Shanghai Chapter, said EU-China cooperation on sustainability is creating tangible opportunities. He noted that European companies’ decarbonization goals are closely aligned with China’s national targets to peak carbon emissions before 2030 and reach carbon neutrality by 2060.

Despite strong momentum, discussions at the ceremony also highlighted persistent execution challenges. Supply-chain emissions emerged as a major concern, with speakers pointing out that around 75 percent of corporate emissions typically originate from suppliers. Yet only 15 percent of companies have set upstream emission targets, and just 36 percent currently report Scope 3 Category 1 emissions, which account for the largest share of total emissions.

Experts emphasized that the difficulty lies not in data collection, but in ensuring quality and consistency across large supplier networks. One global manufacturer shared that it collected more than 4,000 product carbon footprints this year, engaging with over 1,200 suppliers to support decarbonization efforts.

Several speakers stressed that sustainability should go beyond regulatory compliance. An executive from a manufacturing company said ESG must be incorporated into daily decision-making and company culture, rather than treated as a box-ticking exercise.

Financing gaps were also highlighted. Suppliers that receive financial incentives are 45 percent more likely to reduce emissions, yet fewer than 3 percent of companies currently provide such incentives. This gap, speakers warned, could slow progress toward supply-chain decarbonization.

Regulatory uncertainty in the European Union was another topic of discussion. A consular official said that while specific rules may evolve, the overall direction of EU sustainability legislation remains unchanged. Companies were encouraged to continue investing in governance frameworks and supplier engagement.

Also Read: Triodos Bank Wins ESG Award for Conservation Deal

Finally, infrastructure constraints in China, particularly limited access to renewable energy in Shanghai and inter-provincial transmission bottlenecks, were cited as ongoing obstacles to achieving decarbonization targets.

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Source: YiCai GLOBAL