Earlier this year, I noted China’s plan to embrace sustainable business practices. A recent Wall Street Journal article shows signs that country leadership is making good on its green promise.

Under new anti-pollution rules, China’s Ministry of Commerce threatened to shut down polluters for a period of one to three years, depending upon the severity of the infraction. Now China’s State Environmental Protection Agency (SEPA) has gotten more stringent when evaluating the environmental impact of requests to build new manufacturing facilities.

According to the Journal article, in 2006, SEPA rejected 110 construction projects for steel mills, power plants, and other facilities that were submitted for its review due to potentially damaging environmental impact. Through October of this year, the agency has vetoed 187 project proposals, putting the nix on capital investments totaling about $91 billion. SEPA officials told the Journal that they are now rejecting nearly one-third of the projects that submit an environmental-impact assessment. “And most of the ones that clear the process do so only after making changes to satisfy SEPA’s demands.”

While the new moves may curb some of China’s near-term capacity, developing more environmentally sound factories and facilities will yield long-term benefits in the form of more sustainable capacity and growth.