Extended producer responsibility for low carbon transition in automobile industry

Abstract

Extending the responsibility of producers to the entire lifecycle of their products requires additional incentives for the companies to align the efforts of all stakeholders in production and consumption. Using corporate information disclosure as a tool in extended producer responsibility has been a solution in the automobile industry in China to encourage the producers to actively take responsibility in their supply chain. Meanwhile, the low-carbon transition has become a critical incentive for producers to seize the opportunities in carbon emission reduction through the closed-loop supply chain. This study reviews the carbon emission information disclosed by automobile manufacturers in their open reports on sustainability to identify the strategic links between circularity and low-carbon transition from the perspective of producers. The findings are as follows: (1) The global disclosure systems, such as Carbon Disclosure Project, have been increasingly adopted in automobile industry in China; (2) the carbon trading market is crucial for long-term incentives; (3) information sharing mechanism is needed for supply chain cooperation in capturing the low carbon value through closed-loop strategy.