The green economy, and balancing economic and environmental development, is an increasingly important topic in China. Global companies must demonstrate leadership in incorporating sustainability issues in their own operations and product offering. China is one of Nokia’s largest markets, and Nokia has had a substantial presence in the country for 25 years. Like in all Nokia’s local operations, sustainability issues in Nokia China are managed according to global policies and standards, including local production and supply chain management, as well as raising consumer awareness of take-back and recycling programs.

Based on a visionary goal created a decade ago, Nokia has set up a mobile industry value chain in the Xingwang Industrial Park in Beijing that “clusters” Nokia and its key suppliers to produce mobile phones under stringent environmental standards with regard to manufacturing, distribution, sales and recycling. Commissioned by Nokia in 2009, research at the Xingwang Industrial Park shows how well environmental protection and business goals can go hand in hand, achieving considerable cost reduction for the companies located in the area by reducing energy consumption, optimizing material use, and reducing both logistics and inventory costs. It has been called “one of the largest and most complete industry value chains in the world.”

Proximity with key strategic suppliers offers a number of financial and environmental advantages, including a decrease in energy consumption equivalent to nearly 45,000 metric tons of standard coal, reduction of CO2 emissions by nearly 88,000 metric tons, water conservation by half a million metric tons, as well as a reduction in packaging, equivalent to the volume of sustainable logging of more than 1,500 hectares of Chinese red pine forests. The direct economic benefits of energy conservation alone are RMB 672 million (close to US$ 100 million). The industrial park was developed with the support of both the Beijing Municipal Government and the Beijing Economic and Technological Development Area.

The three Rs – Reduce, Reuse, Recycle – are the cornerstone of China’s environmental policy and, to meet these goals, Nokia launched the first mobile device take-back scheme in China in cooperation with China Mobile and Motorola in 2005. During the first year, 1,500 recycling bins were placed in retail shops and repair centers in 40 cities, and the campaign was promoted through TV, radio, newspaper and digital channels. Incentives were used to encourage consumers to return their used devices, such as free airtime for mobile subscribers from China Mobile. Six additional manufacturers have joined the campaign, and coverage of recycling bins has been extended to smaller cities. So far Green Box has collected about 150 metric tons of e-waste. The campaign has received much media attention and has contributed to raising awareness of the importance of recycling in China, and the fact that everyone can make a difference with their own behavior.

As a leader in the telecommunications industry with over 1.2 billion people holding a Nokia phone, the company has a lot of responsibility – but also the power to drive sustainable choices.
This article was first published in the November 2010 edition of Sustain magazine by the World Business Council for Sustainable Development.