Why small and medium chemical companies continue to pose severe environmental risks in rural China

In China, rural chemical SMEs are often believed to still largely operate below the sustainability radar. This paper investigates to what extent and how chemical SMEs are already experiencing pressure to improve their environmental performance, using an in-depth case study in Jasmine County, Hebei province. The results show that local residents had rather low trust in the environmental improvement promises made by the enterprises and the local government, and disagreed with the proposed improvement plans. Although the power of local residents to influence decision making remained limited, the chemical SMEs started to feel increasing pressures to clean up their business, from governments, local communities and civil society, and international value chain stakeholders. Notwithstanding these mounting pressures chemical SME's environmental behavior and performance has not changed radically for the better. The strong economic ties between local county governments and chemical SMEs continue to be a major barrier for stringent environmental regulation. -- Highlights: • Rural chemical SMEs are often below the sustainability radar in China. • Close local government-SMEs tie remained as a barrier for effective environmental enforcement. • Rural communities proved unable to collectively raise their voice. • National government must adopt environment-oriented political incentives. -- The paper provides a major understanding of how and why the large number of existing chemical SMEs in rural China still form major chemical risks