The evolution of climate governance in China: drivers, features, and effectiveness

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ABSTRACT

Understanding the underlying forces of China’s climate governance, and assessing the effectiveness of China’s climate institutions, are critical to the global climate governance architecture. This paper reviews the evolution of China’s climate governance system over the past three decades, and examines how factors such as socioeconomic transitions, cognitive shifts associated with climate change, as well as international climate politics have influenced China’s climate institutions. We argue that the evolution of climate governance is influenced by the varying dynamics between climate change and Chinese state’s quest for performance legitimacy. The positive co-benefits between climate change, energy conservation and environment quality triggered the creation of a dedicated climate agency, which then become an anchor to China’s Five-Year Plan and a centerpiece of climate policy communities. The announcement of a climate neutrality target marked a new moment for China as climate change become a new source of performance legitimacy.

KEYWORDS:

• Climate change
• institutions
• ecological civilization
• performance legitimacy
• China

1. Introduction

Climate change is a rising issue on the agenda of the Chinese government. This trend is evident not only in the recent announcement of a carbon neutrality target by President Xi Jinping,¹ but is also reflected in the recent Five-Year Plans and other high-level government documents (Government of China 2021). Climate governance in China has evolved over time as a result of the country’s socioeconomic transitions, the leadership’s cognitive shifts related to climate change, as well as international climate politics (Tsang and Kolk 2010, Barbi et al. 2016, Liu et al. 2017, Gallagher and Xuan 2018, Wang et al. 2018b). It manifests distinctive features in terms of decision-making processes, implementation, and accountability. Climate change also provides a unique perspective and case study for examining and understanding contemporary environmental politics in China.

Much existing research on environmental politics in China has been conducted under the model of “authoritarian environmentalism”(Gilley 2012, Ran 2013), an approach that focuses on “ecoelites” who are in charge of formulating and implementing environment policies to improve environmental outcomes backed by a centralized, efficient and strong state. Therefore, authoritarian environmentalism is characterized by limited public participation in policy formulation and implementation. However, this theoretical model must engage with the following questions in understanding China’s climate change governance. First, unlike local environmental pollution, such as air and water pollution, the issue of climate change is a long-term challenge, but in the short term does not create serious and widespread social and economic problems in China. Hence, why would a centralized central government adopt proactive policies to address climate change and risk facing large-scale social and economic pressures? That is, how did top-down, central government-led climate governance emerge? Second, unlike other environmental governance issues, local governments have little incentive to implement policies to address climate change, but at the same time they are the actual implementers of climate policy. Therefore, how can the willingness of central government be translated into effective implementation at the local level? What role does divergence, cooperation and the interaction between central and local governments play in China’s climate governance?

China’s climate governance is part of its national governance, and as such follows an institutional logic consistent with national governance. That is, both macro and micro governance behaviors around climate change are based on the existing institutions that shape China’s objectives, choices, behaviors and consequences in addressing climate change at different levels. We argue here that a key factor that has shaped the emergence of Chinese institutions explicitly aimed at climate change is the internal need to respond to challenges to political legitimacy. States prefer to participate in international regimes that are aligned with their domestic interests or to avoid compromising their interests through participation. International pressures can only influence a state’s participation in an international regime when such pressure has the risk of harming its interests. The timing, form and scope of a state’s participation in international regimes are thus ultimately linked to its domestic interests. While international pressure has played a role, the linkage over time to domestic concerns and China’s internal narratives such as scientific development, co-benefits, and the concept of ‘ecological civilization’ have stimulated greater attention to climate change.

This paper contributes to a special collection on ‘Varieties of Climate Governance’ by exploring the evolution of climate governance through a historical review and a detailed discussion of Chinese climate institutions, thereby adding to a comparative understanding of climate institutions globally (Dubash 2021). Moreover, since China is the world’s largest greenhouse gas emitter since 2007 and a key player in international climate cooperation, understanding the underlying forces that have driven changes in China’s climate institutions, and assessing their effectiveness, are critical to understanding global climate governance architecture.

We adopt a qualitative methodology, using information collected from fieldwork, interviews² and public documents for our analysis. The primary information consists of viewpoints collected from the fieldwork and interviews. As a result of our fieldwork³ with continuous follow-up, we are able to closely observe the evolution and development of China’s climate change governance. Retrospective interviews were used to collect information prior to 2008. The secondary information consists of official documents, media articles, scientific literature and policy announcement. Specifically, to understand how the carbon neutrality decision was made and how this decision is affecting China’s future climate actions, we conducted a semi-structured interview with key experts involved in the process of decision making.

The paper is organized as follows. In Section 2 we discuss the structure and institutions of China’s climate governance system. In Section 3, we review the various factors that have driven the evolution of China’s climate governance. In Section 4 we use China’s carbon neutrality announcement as a case study to illustrate the dynamics and logic of climate governance in China. Finally in Section 5 we conclude by discussing the strengths, limitations, and global implications of China’s climate governance.

2. Context for the emergence of Chinese climate institutions

China’s climate governance should be understood within the context of the country’s overall governance structure (Ran 2013). China’s political system is a primarily hierarchical structure with the the Chinese Communist Party (CCP), the National People’s Congress (NPC), the central government on the top and 34 provincial-level governments, 333 municipal governments, and more than 2800 county governments at the lower levels (National Bureau of Statistics 2020).

From a theoretical perspective, it is necessary to distinguish between the party and the administration, at all levels of government. The reason for this is that in China’s governance structure, the former sets the objectives and the latter implements them (Zhou 2017). China’s bureaucracy is characterized by a clear upward accountability: the main objective of the lower level of government is to fulfil the tasks assigned by the higher level, because promotion of individuals is often dependent upon the successful achievement of goals set by higher levels of government. However, the implementation can be challenging or biased due to a lack of resources, conflicting priorities, and inadequate incentive structures at local level (Schreurs 2017).

The Central Committee of CCP is at the top of political pyramid in China and holds the highest decision-making power in all policy areas. However, this decision-making power is not realized through specific policy formulation, but rather through problem framings that are shaped to provide macro-strategic guidance to the government in policy making. One aspect of the guidance provided by CCP on policy development is to provide suggestions in key policy areas, including Five-Year Plans. As one example, China’s peak carbon emissions and GDP carbon intensity targets were proposed at the Fifth Plenary Session of the CCP’s 19th Central Committee. Thereafter, the targets were later reaffirmed in the NPC’s Outline of the 14th Five-Year Plan (2021–2025) and Long-Term Goals to 2035.

As China’s highest authority, the NPC as well as its Standing Committee exercise legislation power together. In the case of climate change, the NPC adopts binding targets for emissions reductions by means of the country’s Five-Year Plans. It also adopts laws related to national climate action, such as the Renewable Energy and Energy Conservation Laws (Liu 2019). While climate legislation has been advocated in China for many years, there has been no significant progress so far due to the difficulty in dividing proposed climate legislation from the existing laws.

The central government (i.e. the State Council) is responsible for translating the Central Committee of the CCP’s target setting, political guidance and macro-strategies into operational policies, including administrative regulations, policy instruments, and regulatory measures. In recognition of the cross-cutting nature of climate change policy, the State Council has adopted a coordinated cross-ministry approach for climate policy decision-making. The National Leading Group on Climate Change Response, Energy Conservation, and Emissions Reduction (NLGCCR), headed by the Premier and consisting of more than 30 ministers as members, is the advice and coordination body across different ministries related to climate change at the state council (See Figure 1).⁴ The Central Committee of the Party and the State Council have used informal bodies called ‘leading groups’ to deal with specific issues. Normally, those leading groups have the mandate to advice the body which appointed them on strategies, policies and coordinate implementation of those strategies and policies. The importance of those leading groups can be sorted based on the body which mandated them or the political standing of their heads and members. For example, the NLGCCR is a leading group appointed by the State Council and headed by the Premier, therefore has a higher political sort compared with other leading groups at the State Council.

Figure 1. Governance structure and policy cycle for climate change in China

Note: This figure is a simplified illustration of policy cycle for Five Years Plan in China.

In the central government, the Climate Change Department (CCD) under the Ministry of Ecology and Environment (MEE) is the primary agency in charge of climate issues (Government of China 2021). The three main tasks of the CCD include developing China’s climate strategies, programs, and policies; participating in international climate negotiations; and monitoring China’s policy progress under the UNFCCC.⁵ CCD is responsible for drafting all of China’s major climate policies, programs and strategies, e.g. GDP carbon intensity reduction targets during the Five-Year Plans, 2030 carbon emissions peaking target and 2050 Low GHG Emissions Development Strategy. CCD is also responsible for the construction and management of the national carbon emission trading scheme, and served as the Office of NLGCCR, highlighting its important role in coordinating China’s climate policies. While MEE is the leading agency in climate policy, cooperation and coordination with other ministries is indispensable. For example, renewable energy policy is the responsibility of the National Energy Agency (NEA), while energy efficiency in industry, buildings and transport is the responsibility of the Ministry of Industry and Information Technology (MIIT), the Ministry of Transport (MOT) and the Ministry of Housing, Urban and Rural Development (MOHURD), respectively. Climate change has ‘anchor’ offices in all related ministry to facilitate ministry-wide climate policy coordination (see Figure 1).

At the provincial, municipal and county levels, climate governance is very similar to that of the central government. The provincial level consists of the provincial committee of the CPC, the local PC, the provincial government, as well as local branches of various ministries. Provincial CPCs and provincial governments are jointly responsible for implementing climate policies set by the central government. Each province has also established a climate change leading group to coordinate climate action among different government agencies.⁶ Therefore the structure of Chinese climate governance can be illustrated as a two tier system of setting targets and allocating responsibility (Kostka 2016). At the first tier, the central committee of the Party sets the target and the central government is responsible for making plans and strategies. At the second tier, the central government allocates and sets the target to different local government and the local government takes responsibility and accountability for implementation. The central government periodically evaluates and publishes the performance of each province to create incentives and pressure. Provinces also evaluate lower level governments, therefore serving as both principal and agent in the governance structure. The county government is responsible for implementing climate targets, but under China’s top-down system, the county government is faced with a range of policy targets from higher levels of government and only has limited resources to implement them. Therefore, when county governments’ budgets are too tight, they can only selectively implement priority policy objectives. In most cases, climate change objectives are not a priority for county governments. A provincial government’s performance is determined by the performance of local governments under their jurisdiction, so provincial governments have an incentive to collude with lower level governments in response to central government’s evaluation. This principal-agent dilemma poses a major challenge for China’s policy implementation (Kostka and Nahm 2017). The pressure can also lead to selective responses, cheating behavior, and even reckless intervention in the market through administrative measures. For example, at the end of 2020, Zhejiang Province imposed direct production restrictions on coal power plants in order to meet coal control targets, and resulting in a shortage of electricity supply.⁷

One feature that distinguishes climate policy from other environmental policies is that while MEE takes the lead in setting climate change-related policies, the vast majority of ‘climate policies’ are in fact sectoral policies and thus fall under the jurisdiction of traditional sectoral ministries. Thus, when setting climate change policies, environment ministries must consider whether their policies are acceptable to other sectoral ministries, which requires regular policy coordination, bargaining and communication through an inter-ministerial coordination mechanism for climate policy development. The bargaining power of coordinating ministry is closely related to its capacity of resource mobilization. For example, the National Development and Reform Commission (NDRC) is considered the most able coordinating agency because its ability to allocate resources through planning and implementation of Five-Year Plans.

From year 2008 to year 2018, NDRC hosted the CCD, after which it was shifted to MEE. Some researchers believe that the transition of CCD from NDRC to MEE actually impedes its coordination of climate change. However, this argument neglects the fact that policy bargaining occurs not only between ministries, but also within them. Within the NDRC, CCD was not able to compete with other professional divisions within the NDRC, such as the ERD (Environment and Resource Department) and NEA. As a result, climate policy was often already weakened within the intra-ministry coordination process. After the transition from NDRC to the MEE, climate policies have had a greater chance of surviving during intra-ministry coordination and being considered at the State Council level.

Climate policy making in China is not a black box; experts, businesses, industry associations, NGOs and individuals all have different channels to participate in policy making process (Shen 2017; Teets 2013). In China, expert consultation is a standard part of climate policy making. Governments seek expert advice through consultation sessions in virtually every major policy-making process. However, there is no strictly prescribed process or procedure for this process, and usually the Chinese Academy of Engineering (CAE), the Chinese Academy of Sciences (CAS) and the China’s National Expert Committee on Climate Change (NECCC) are the most commonly consulted expert groups. Other think tanks such as the Energy Research Institute (under the NDRC), the National Center for Climate Change Strategy and International Cooperation (under the MEE) and university think tanks also play an important role in expert consultation. The NECCC does not belong to the government and is composed of approximately forty experts representing universities, research institutes, and think tanks. It is not mandatory for the State Council to seek advice from NECCC. However, the scientific community’s consensus has played a significant role in China’s development of key climate policies. The NECCC’s research reports, for example, supported the decision-making process regarding China’s climate commitments under the Copenhagen Accord and the Paris Agreement.

Another institutional design to link climate experts with top leaders is the regular collective learning session by the Politburo of CPC. The Politburo has regularly invited experts to make lectures on key policy issues to all Politburo members since 2002. Since 2012, the Politburo has carried out 73 learning session, including three on climate change. International expertise and cooperation also play a role in China’s climate change policy making process. For example, as a high-level international advisory body, the China Council for International Cooperation on Environment and Development (CCICED) has played a unique role in establishing a channel between international experts and top Chinese political leaders. From 2010 to 2016, China received US$158 million in grants from multilateral institutions for 43 climate change projects, as well as US$4 billion in concessional loans from multilateral banks and about US$1 billion from bilateral channels (mainly from European countries) for the implementation of climate change projects (Government of China 2018a, Government of China 2018b). These international financial sources have helped China to rapidly build capacity in policy area, for example the EU, WB and ADB have all provided capacity building and financial support for the establishment of an emissions trading system (ETS) in China.

China’s climate policy making process also includes consultations with business and industry associations. The government has even commissioned industry associations to draft some of the policy documents. For example, the emission benchmark for power companies in the ETS was drafted by China Electricity Council (CEC),⁸ the industrial association in power sector, due to its expertise in power sector and its capability of coordinating generation companies. IGOs and NGOs have also been contributing to the policy-making process in recent years. For example in the drafting of the adaptation strategy, the CCD also invited input from the Global Centre on Adaptation. Compared with other stakeholders, NGOs and individuals have relatively limited access to policy making process, operating mainly through requests to the government for disclosure of information, and submitting suggestions during the consultation phase of the five-year plan.

As Figure 1 summarizes, the gradual layering over time has led a substantial architecture of Chinese climate institutions, including line ministries, local governments tied together through regular coordination process, expert and technical bodies, and mechanisms to engage, at least some extent, external actors. Significantly, a purpose-built body, the National Leading Group on Climate Change formulates national strategy to address climate change, coordinates across various parts of government, backed by the mandate and endorsement of the State Council. This architecture has emerged through a gradual process, driven by the growing needs of performance legitimacy, as the next section suggests, but also punctuated by occasional shifts in the narrative, such as the emergence of a climate neutrality objective, discussed in a subsequent section.

3. Evolution of climate governance in China

Every regime needs to justify its legitimacy. Weber identifies three ideal types of legitimacy for a regime (Weber et al. 1978): traditional legitimacy, charismatic legitimacy, and juridical legitimacy. Zhao (Zhao 2009) proposes an analytical framework based on Weber’s theory of legitimacy which includes ideological legitimacy, performance legitimacy, and procedural legitimacy. Ideological legitimacy means that the legitimacy of state rule is based on a widely accepted ideology. Performance legitimacy is determined by the state’s ability to provide public goods. Finally, if the state’s rule is based on widely accepted procedures, this constitutes its source of procedural legitimacy. Similarly, Zhao’s three classifications of legitimacy are ideal types, and all states derive legitimacy from a combination of all three legitimacy sources. Not all scholars agree that government performance is a source of legitimacy. Lipset (Lipset 1981), for example, argues that performance is instrumental and thus cannot be classified as evaluative legitimacy. However, most contemporary Chinese political scholars (H. Yang and Zhao 2015) agree that performances remain the most important source of state legitimacy in China since the economic reform and opening up of the economy.

Here we examine the evolution of China’s climate governance within the context of changing sources of performance legitimacy. A central argument of this paper is that performance legitimacy drives not only the Chinese government’s pursuit of economic success and social development, but also is the underpinning logic for understanding the changing structure of climate change governance in China. Changes in climate governance have been driven by the relationship between climate change and government’s performance objectives over time. China’s central concern during the era of Deng Xiaoping was to gain legitimacy through economic development, which was a salient feature of the reform and opening policy. Deng Xiaoping stated that “if economic development continues at a low rate, living standards will remain low, so why do the people support us?“(Deng, 1993)⁹ China has effectively achieved economic growth through a number of reforms including urban reform, restructuring state-owned enterprises, and a tax-sharing system. Per capita GDP increased from US$156 in 1978 to US$1,288 in 2003,¹⁰ an increase of 8.3 times, with an average annual growth rate of 8.8%. As the ‘development first’ paradigm dominates national policy making, the reduction of greenhouse gas emissions was considered as a ‘major issue affecting socio-economic development’, and therefore needs to be addressed while ensuring ‘moderate economic development and reasonable per capita energy consumption’ (Liu 2019). As then Chinese Prime Minister Li Peng pointed out at the 1992 Rio Earth Summit, ”Economic development is the material guarantee for the protection and improvement of the environment, and economic development and poverty eradication are the top priorities for developing countries.” (CCICED Policy Report 2007). International climate change negotiations, while not having a substantial impact on domestic policy, have facilitated the establishment of institutions for climate policy coordination. In 1998, as part of the institutional reform, the State Council established the National Climate Change Response Coordination Group (NCCRCG), an ad hoc inter-ministerial body led by the National Development Planning Commission (NDPC, became NDRC in 2003). The establishment of the NCCRCG highlighted the rise of climate change in China’s decision-making priorities.

In the 1990s, economic reforms greatly enhanced living standards in China but also created a number of new social conflicts, including social inequality, corruption, and environmental pollution. A growing number of environmental mass incidents have been reported in the media since 2003, from one in 2003 to 58 in 2011 (Zhang et al, 2015). China’s performance in government is hampered by environmental pollution, as well as other social issues. The new generation of Chinese leaders is beginning to realize that economic growth alone is not sufficient to contend with governing pressures and that the basis of performance legitimacy must shift from an economic focus to a broader range of socially beneficial public goods. In July 2003, Hu Jintao, the new president, proposed a paradigm shift in development philosophy, stating that “development does not refer only to economic growth, but also to achieving comprehensive social development”. This statement was later developed into the “theory of scientific development”, which was characterized by socially inclusive and environmentally sustainable development, and was included into the Party Constitution and became an important landmark of the government’s change in development thinking (Ngok 2009).

The source of performance legitimacy then included both economic development and social public goods such as environmental quality. During this shift, climate change was not considered a new source of legitimacy, due to its nature as a global public good. However, the Chinese government was starting to recognize the positive contribution of climate change to new sources of performance legitimacy such as environmental quality. This was especially true for controlling coal consumption since coal contributes 70% of China’s greenhouse gas emissions, as well as more than half of its air pollution (PM2.5 emissions) (Yang and Teng 2018). The central government found emissions mitigation to be aligned with the country’s interests in economic re-balancing and air quality improvement, and the concept of ‘co-benefits’ began to be highlighted. During this period, China began to view climate mitigation as both an international responsibility and an inherent national interest. But there was no government agency dedicated to climate change, so climate-related policies were mostly in the form of energy efficiency and renewable energy policies and were made by agencies in charge of energy. A series of national energy conservation policies and programs were initiated in this period, which had significantly reduced China’s per GDP unit energy consumption (Zhou et al. 2010), and China’s wind power and photovoltaic industry began to develop as the result of policy support (Zhang et al. 2009).

In 2007, China surpassed the United States as the world’s top emitter of greenhouse gases and began to be under closer international scrutiny. With this background, in May 2007, Premier Wen Jiabao chaired an executive meeting of the State Council to discuss the publication of China’s National Climate Change Programme (China State Council 2007). This meeting was a key moment that climate change was elevated to the highest level of the government – the State Council. The meeting highlighted the needs to improve institution and mechanism to address climate change. In 2008, the CCD, the first formal government agency dedicated to climate governance, was established as a part of State Council’s institutional reform. Since then, China’s climate policy making gradually became independent of energy and environment policies. In June 2007, China upgraded the NCCRCG to the NLGCCR, with the Premier as its head and the ministers of more than 20 related ministries as members. The Leading Group’s main tasks include formulating major national strategies to address climate change, coordinating inter-ministerial efforts, as well as guiding international cooperation and negotiations. The establishment of the leading group again marked an increase in the importance of the issue of climate change.

The establishment of CCD was an important step in China’s climate governance system. Climate policy began to separate from the environmental and energy policies, as well as integrate to the Five-Year Plans as CCD became an anchor to this process (See Figure 1). Starting in 2011, climate change targets were included as legally binding targets in the twelfth and thirteenth five-year plans (Li and Wang 2012). A series of low-carbon city pilots and ETS programs were initiated. After 2012, regional GDP growth rates were no longer the only dominant evaluation criteria for local officials, and sustainability and environmental protection became more important in performance evaluation for local government. Therefore, local governments were also more incentivized to participate in various climate programs. 2018 marked a new milestone for China’s climate governance, when the CCD moved from NDRC to the newly formed MEE. The underlying logic for this institutional change was to manage the environment as a whole system under one ministry in order to avoid policy overlap and contradiction, which was an application of the ‘thought of ecological civilization’. At this stage, addressing climate change contributes indirectly to other sources of performance legitimacy such as environmental protection. Consequently, although the climate change target is independent, it is still affiliated to the environment and energy consumption goal as a ‘soft constraints’. Climate targets do not actually play a binding role when they are less ambitious than other policy objectives, such as environmental objectives.

Since the 19th Parties’ congress in 2017, the ‘thought of ecological civilization’ has been formally recognized as one of the cornerstones of China’s long-term development philosophies. Another concept closely related to “ecological civilization“ is ”community with a shared future of mankind”, which implies that each country should take into account the legitimate concerns of others and promote the common development of all countries while pursuing its own development, a new paradigm for China’s international relation policies. From an economic development perspective, during this period addressing climate change is also considered to be consistent with the national strategy for economic restructuring, or so-called “green and high quality development”, which aims to reducing shares of highly polluting, energy intensive industries while increasing shares of renewables, high-tech and high value-added industries (Green and Stern 2017). These factors combine to make climate change an available option as a new source of performance legitimacy. It is in this context that the Chinese government surprisingly set an ambitious target in September 2020 to achieve carbon neutrality by 2060.

4. Campaign style governance and China’s carbon neutrality target

On 22 September 2020, President Xi Jinping announced that China would peak its carbon emissions by 2030 and reach carbon neutrality by 2060. Nearly all observers were surprised by this announcement since there was no public information indicating that China was seriously considering net-zero emission as a long-term goal. The motives behind China’s carbon neutrality initiative have not previously been examined, but this paper argues that China sees the goal as a new source of performance legitimacy.

Unlike previous sources of performance legitimacy, which are primarily focused on domestic issues such as economic growth and environmental quality, climate change, as a new source of performance legitimacy, is deeply connected with provision of global public goods. Interviewees identified several reasons for the Chinese government to consider global public goods a new source of performance legitimacy.

First, the COVID-19 pandemic has resulted in China receiving criticism from the Trump administration, and these attacks have linked the pandemic to the Chinese political system directly, creating a crisis in the legitimacy of the Chinese government. To respond to this attack, the Chinese government must demonstrate that it is capable of working globally to combat COVID-19 and climate change. As a result, Xi presented climate change and COVID-19 pandemic as major tests of administrative strength and of global governance and repeatedly emphasized that “great powers“ should provide ”more global public goods” to the world in order to demonstrate their responsibilities. Second, global economic growth is facing uncertainty during the pandemic, thereby undermining the possibility of economic growth as a source of performance legitimacy. Additionally, poverty eradication and environmental protection have also reached bottlenecks, making it harder to continuously improve future performance. Chinese leaders are beginning to recognize the importance of climate change as a new source of performance legitimacy as traditional sources dwindle. Third, Generation Z and the Millennial generation currently represent 40% of China’s population,¹¹ and their views on China’s political system will have a significant impact on China’s future. Millennials in China are well educated, able to access a variety of information sources via the internet, have grown up at a time of rising Chinese power, and support China’s political system in a more confident and positive way. Like millennials across the globe, Chinese youngsters are also more global-minded and more concerned with environmental issues like climate change.¹² Thus, the ability to effectively address global challenges like climate change is an important source of performance legitimacy for gaining political support from Millennials.

In addition, the diplomatic dispute between the US and China over the global environment confirms that climate change and carbon neutrality have become increasingly tied to the legitimacy of the political system, and are increasingly politicized. Three days after Xi’s speech in UN, the US State Department published a “China’s Environmental Abuses Fact Sheet“¹³ on its website, claiming China is the world’s biggest polluter. Former US Secretary of State Pompeo is quoted as saying “The Chinese people – and the world – deserve better.”. China’s Foreign Ministry responded by releasing a ”Fact sheet on US environmental abuses”¹⁴ on October 11. In both fact sheets, climate change tops the list, demonstrating tensions between the US and China over global environmental and climate governance. During the dispute, the legitimacy of China’s political system has also been the focus of US criticisms of the country. As a result, whether China can achieve its emission peak and become carbon neutral has become a political issue for China to demonstrate its legitimacy. Delivering on its promises would give China a strong hand in the legitimacy fight. But if China fails to find new sources of performance legitimacy, it will face significant challenges in the future.

China’s top leadership is aware of this serious challenge. President Xi Jinping reiterated China’s carbon peak and carbon neutrality commitments 20 times¹⁵ in the past year. As a result of this political challenge, the Chinese government has realized that conventional governance approaches are ineffective and has sought to break the deadlock and accelerate the process through a campaign-style approach. First of all, carbon peaking and carbon neutrality were included as topics for discussion at the highest level of economic work meetings. Both the Central Economic Work Conference¹⁶ at the end of 2020 and the Central Finance and Economics Commission¹⁷ in March 2021 listed carbon neutrality as a key topic. This is the first time that climate change has been discussed at the highest levels of economic work meetings. The Central Finance and Economics Commission described carbon neutrality as “a major test of the ability to govern the country“. It then called for “improving the supervision and evaluation mechanism” and clearly identified the responsible parties as ”all levels of government and party committees”. Even though the CCD and MEE is still the focal point for climate change, the NDRC, has once again been designated as the coordinating ministry for carbon peaking and carbon neutrality. This re-assignment illustrates the willingness of Chinese authorities to break down traditional divisions of responsibilities between ministries and move administrative boundaries in a top-down, campaign style governance model. However, this flexibility also reflects the legal dilemma faced in the Chinese system. After the meeting of the Central Finance and Economics Commission, a new Leading Group on Carbon Peaking and Carbon Neutrality was established in May 2021, appointed by and reporting to the Central Committee of the Party, with the office hosted by NDRC. As the political stand of Central Committee of the Party is higher than the State Council, the establishment of the new leading group also demonstrates the increasing importance of climate change in China’s political agenda.

As discussed above, China’s bureaucracy constitutes a conventional system of managing climate change, i.e. the use of traditional hierarchies within the existing bureaucracy in order to achieve predetermined climate policy goals. Besides conventional governance, campaign style governance is also a form of governance in China (Jia and Chen 2019). In campaign style governance, the bureaucracy is disrupted with political mobilization, and resources are allocated from the top down to achieve specific goals. The Chinese government chooses campaign style governance rather than bureaucracy-based conventional governance when it faces severe challenges which can’t be resolved by the bureaucracy.

The traditional and campaign style governance structures coexist in China because of the co-existence of the executive and the party system in government. Conventional governance refers to the daily operations of the executive system. By contrast, campaign style governance is initiated and led by the party system, which converts administrative tasks into political ones, mobilises sufficient resources in a short amount of time, and accomplishes tasks through the political system’s power. Prior to the announcement of the carbon neutrality target, China’s climate governance was mainly handled by the existing bureaucracy. However, since the announcement of the carbon neutrality target, climate governance has taken on more of a campaign-style governance character, in which top leaders mobilize resources and attention to act and relay central government signals to key policy makers at local levels and sectors within a short span of time.

This is the first time that climate change governance has been driven by a campaign-style governance approach based on experience in environmental protection. Due to the asymmetry of information and principal agent problem, the central government realized that the bureaucracy will fail to achieve environmental governance objectives. For climate governance, local governments face a more serious principal-agent problem, because they will pay the full cost of emissions reduction, but will reap almost no benefits from such reduction. As a result, only campaign-style governance can swiftly advance the implementation of carbon peak and carbon neutrality targets within the existing governance framework by turning administrative issues into political ones. In addition, the campaign-style approach to environmental governance, represented by the Central Environmental Protection Inspectorate (CEPI), has made the central government realize that inspecting enterprises and local branches of sectoral administrations is not a useful way to achieve its objectives. The implementation outcome could be boosted only if local governments and party committees were subject to inspection, and link the results of inspection with their political promotion (Jia and Chen 2019). Therefore, from the beginning, the central government has stressed the importance of the monitoring and evaluation mechanism, specifying that the main bodies responsible for carbon neutrality and carbon peaking are the party committees and governments at all levels.

Through campaign-style governance, the central government can effectively convey to the bureaucracy its strong commitment to carbon neutrality. This mechanism is conditional on the fact that the party has the absolute authority to alter the rules of the game. It is also this absolute top-down power that creates the dilemmas embedded in the conventional governance mechanisms. However, it is not sustainable in the long term to focus political resources on a single source of performance legitimacy. Therefore, the climate governance will likely shift between conventional and campaign-style governance in the future. Climate governance is heavily influenced by the experience of environmental governance, therefore one possible option is to incorporate climate change into the current system of environmental inspection, resulting in the gradual move from campaign-style governance toward conventional governance.

Although the campaign-style governance is effective to mobilize political attention and coordinate government across different levels, the ability to incentivize long-term transformation is still a concern due to the implementation bias. The root cause of this bias is that while local governments are responsible for climate change and emissions reduction targets, most economic policy instruments are owned by the central governments, not the local government. Thus the power and responsibility of local governments do not match. Local governments can only intervene through costly administrative measures to achieve their targets. This dilemma will be even worse in a campaign-style approach due to high political pressure on local government. One possible solution to resolve this dilemma is to shift mitigation policy instruments from an administrative approach to a market based approach. Such a shift may further affect the transformation of governance structures, particularly the relationship between the central and local government. As more and more emission sources are covered by the carbon market, the responsibility of local governments in reducing emissions will shift towards the market, which may help to address the ‘implementation bias’ in China’s governance structure.

5. Conclusion

The global nature of climate change and the pressure of international negotiations have brought the issue of climate change into the view of China’s political leaders from the very beginning. But the evolution of climate governance in China is driven by the dynamics of pursuing various sources of performance legitimacy. When economic development was the main source of performance legitimacy, the old thinking that emissions reductions affect development led China to take a conservative position on climate change. Whereas when environmental quality became the new source of legitimacy, the government became proactive in addressing climate change and created new institutions to gain co-benefits through advancing climate action. Climate change institutions then drove climate policy through Five-Year Plans within the bureaucracy. The exhausting of domestic sources of legitimacy and pressure from international sources due to factors such as COVID led China to consider climate change as a new source of legitimacy, which finally lead to the announcement of the carbon neutrality target and marked a new era in China’s climate governance.

What does the system of climate governance in China imply for solving governance challenges such as coordination, mediating politics, and strategy setting (Dubash 2021)? Under conditions of political consensus, China’s top-down governance structure and vertical accountability system are capable of coordinating the actions of ministries and different levels of governments, as well as mediating the conflicts of interests between emissions reduction and economic development (Qin et al. 2019). Horizontally, since many climate initiatives are beyond the jurisdiction of MEE, the NLGCCR plays an important role in advising the state council on strategies and policies and coordinating different ministries related to climate change and can resolve potential conflicts at the state council level. The potential problem of such coordination is that NLGCCR and other mechanisms are ad hoc and cannot guarantee climate is always on the agenda. To formalize coordination mechanisms and integrate climate goals in each stage of sectoral policy making would require passing a climate law, which is now absent in China (Neuweg and Averchenkova 2017).

Implementation and coordination at the local level remains the biggest challenge for climate change governance in China. The main logic of local governments in China is to fulfil the targets set by higher levels of government (Landry 2008). But being ‘accountable to higher level government’ does not always mean that local governments act in line with policy intentions of central government.

The Chinese government has also been successful in bringing transformative changes and developing capacity for strategic shifts. Changes in governing philosophy and source of performance legitimacy have been part of these shifts; the ‘thought of ecological civilization’ and ‘community with a shared future of mankind’ is a fundamental cognitive change compared to the‘GDP first’ development philosophy that had dominated since the 1980s, and has shaped policy accordingly. The change in source of performance legitimacy has also led to the establishment of CCD as a climate host in China’s government. This institutional change has catalyzed and accelerated the climate policy making process in China. Finally, the NLGCCR appointed by the State Council and the new leading group appointed by the Central Committee of the Party, provides a strategic element to Chinese climate governance through formulating strategies and policies and coordinating implementation.

Similar to environmental governance, climate governance also experienced a shift between conventional and campaign style governance. In particular, following the announcement of carbon neutrality targets, the central government opted for campaign style governance to jump-start the bureaucratic response. Based on the experience of environmental governance, campaign-style governance for climate has worked well in the short term, but the long-term effects need to be further observed. Due to the inherent contradictions in China’s governance structure, implementation bias will be a major challenge in the climate governance process. A possible solution is to rely more on market rather than administrative instruments for emission reductions. As China tries to shift toward more market-oriented policies, such a government-dominant structure could become an impediment. The difficulties in China’s ETS programs, including the influences of state energy monopolies and highly regulated price schemes in power sector, illustrate the need for further reforms in the governance structure and philosophy.

The institutional capacity dedicated to climate change is relatively thin, compared to other major countries, but climate-related institutions are strong. Thus the coordination among different government agencies is critical to climate governance. Arguably, the CCD at the central level and its corresponding local offices are understaffed given the need to make myriad climate policies and at the same time administer complex systems such as the ETS. But NDRC, the NEA, the MoT, and other climate related agencies have also played critical roles in the country’s emissions reduction, through structural and technological changes in industrial, energy, and transportation sectors. Some policy experts have pointed out that the current coordination scheme is in many cases ad hoc, which could make climate policies at odds with energy and industrial policies. The new leading group on carbon peaking and carbon neutrality will serve as a formal coordination mechanism, which integrates climate goals in each stage of sectoral policy making, needs to prove itself for policy coherence.

Compared to its counterparts in other countries, the ‘Chinese model’ of climate governance has its roots in China’s political institutions, which to a large extent are unique in today’s world. There are prominent strengths in the ‘Chinese model’, but also noticeable limitations (QIN et al. 2019). There are two steps from the problem framing and target setting of CCP to central government strategy planning and policy making and then to local government policy implementation, and thus there may be significant distortions in the implementation process. The process of translating the party’s political goals into policy design is often constrained by games between government agencies, path dependence, and gradualism, and thus it could be difficult to adopt more appropriate policies instruments. In translating these central government plans and policies into local government implementation, the wrong incentives may further weaken implementation. China’s climate governance provides a testing ground for observing the effectiveness of environmental authoritarianism. The ‘Chinese model’ might be difficult to copy to other countries, which usually do not have a centralized political system covering such a huge population and land area. Even so, mutual understanding and learning between China and other countries can shed light on directions to improve concepts of climate institutions and governance in the future, grounded in an understanding of national contexts and politics.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Funding

This work was supported by the National Natural Science Foundation of China [71690243, 72004216];

Notes

1. http://www.xinhuanet.com/politics/leaders/2020-09/22/c_1126527652.htm

2. The analysis in Section 4 of China’s carbon neutrality targets is based primarily on field interviews. In response to explicit requests from interviewers, we did not directly quote from the interview transcripts.

3. Since 2008, the lead author has been conducting long-term observational research with China’s climate change authority, working together with officials and participating in the policymaking process.

4. See http://www.ccchina.org.cn/Detail.aspx?newsId=28014&TId=60

5. See http://www.mee.gov.cn/xxgk2018/xxgk/zjjg/jgsz/201810/t20181008_644817.html

6. For example, the organization of leading group in Hubei province can be found http://hbj.wuhan.gov.cn/fbjd_19/xxgkml/zwgk/wrfz/dqwrfz/202009/t20200928_1457500.html

7. https://finance.sina.com.cn/china/dfjj/2020-12-16/doc-iiznctke6874021.shtml

8. https://www.belfercenter.org/sites/default/files/files/publication/zhang_jingjie-en-tsing-cec.pdf

9. Page 35, Deng XP. 1993. Deng Xiaoping’s Selected Writings vol III. People’s Publishing House. Beijing.

10. https://data.worldbank.org/indicator/NY.GDP.PCAP.CD?locations=CN

11. https://go.euromonitor.com/white-paper-digitalconsumer-201013-How_Chinas_urban_Millennials_and_Gen_Z_Live_and_Spend.html?utm_source=Press_release&utm_medium=PR&utm_campaign=CT_WP_20_10_13_Chinese_Gen_Z_and_Millennials

12. https://www2.deloitte.com/content/dam/Deloitte/cn/Documents/about-deloitte/deloitte-cn-2020-millennial-survey-zh-201021.pdf

13. https://2017-2021.state.gov/chinas-environmental-abuses-fact-sheet/index.html

14. https://www.fmprc.gov.cn/web/wjbxw_673019/t1824977.shtml (in Chinese)

15. http://jhsjk.people.cn/ (in Chinese)

16. The Central Economic Work Conference is China’s highest-level economic work conference, jointly convened by the Central Committee of the Communist Party of China and the State Council, and has been held annually since 1994 with the objective of making plans for China’s economic development in the following year.

17. The Central Finance and Economics Committee is the deliberative and coordinating body of the Central Committee of the Communist Party of China to lead the financial work, and is the central leadership and decision-making arm of the economy of China.