ESG Short Commentary | Frequent Safety Risks, China Railway Construction Needs to Strengthen the "Penetration" of ESG Systems

Asking AI · Why Are Grassroots Implementations of China Railway Construction’s ESG System Encountering Obstacles?

By the end of the first quarter of 2026, China Railway Construction (601186) has already reported two safety production accidents among its contracting companies.

On March 30, a suspected flammable gas explosion occurred inside the tunnel of the Enshi to Guangyuan expressway control project contracted by China Railway 12th Bureau, resulting in 4 deaths and 9 injuries. Currently, the affected construction site has been sealed off, and an investigation into the accident has begun. Just last February, a collapse of a tie-rod arch beam occurred at the Yangtze River Bridge on the Lianshen Line in Xiangshui, Yancheng, Jiangsu, also contracted by China Railway 12th Bureau, causing 5 fatalities.

Safety accidents in infrastructure projects are not uncommon, but each incident’s severe consequences remind us that safety defenses must never be relaxed.

In addition to the accidents involving China Railway 12th Bureau, multiple safety production incidents have occurred among various China Railway Construction units over the past year. This exposes potential gaps in China Railway Construction’s safety management, indicating that the group’s ESG management system has failed to effectively penetrate into all business units and project sites.

Poor core risk control leads to safety accidents across multiple subsidiaries. Safety production is the most critical ESG risk issue in the construction industry. According to the Southern Weekly Shanze Big Data Platform, in 2025, the real estate construction sector recorded a total of 1,728 ESG risk events, with 840 related to safety responsibilities, accounting for 49%.

China Railway Construction ranks second in the ESG risk list within the real estate and construction industry, with a total of 119 ESG risk events, including 61 related to safety responsibilities. For example, in June 2025, China Railway 18th Bureau was fined 700k yuan for violating safety production laws. In September 2025, China Railway 17th Bureau Fourth Engineering Co., Ltd. was involved in a construction accident at the border of Bao’an and Longhua in Shenzhen, where construction vehicles ran over workers, resulting in one death. In December 2025, China Railway 16th Bureau was fined 100k yuan for failing to prepare and implement safety-specific construction plans for high-risk sub-projects according to standards.

Although the construction industry faces objective factors such as project scale expansion, complex construction environments, and high-altitude or underground operations prone to safety accidents, many incidents are not solely due to natural or accidental factors. They are often related to inadequate safety management, such as negligent subcontractor management, lack of on-site supervision, or even illegal subcontracting and subcontractor violations, disregarding project quality and safety. During a February 2026 press conference, the Ministry of Emergency Management pointed out that the collapse of the Jiangsu Xiangshui bridge revealed issues with illegal subcontracting: “The project was ostensibly undertaken by a top-tier qualified enterprise, but in reality, it was executed by a ‘cowboy team,’ making quality assurance difficult.”

From “paper” to “ground,” systems must penetrate hierarchical barriers and blind spots. In fact, as a large-scale comprehensive construction group, China Railway Construction has established systematic safety management and continuous investment. “Engineering quality and safety” are core topics for its sustainable development. In 2024, China Railway Construction issued the “Three-Year Action Plan for Safety Production Governance (2024-2026).” In 2025, it developed the “Guidelines for Essential Safety (2025 Edition),” its first comprehensive safety framework, guiding all levels to build systematic management systems; it also issued safety standard manuals for tunnels, bridges, protective works, railway line construction, offshore wind power, and drilling-blasting tunnel construction, enhancing overall on-site safety management. In 2024 and 2025, China Railway Construction invested 19.4 billion yuan and 17.7 billion yuan respectively in safety production.

However, there remains a significant gap between policies on paper and their implementation on the ground. Large groups like China Railway Construction, with multiple corporate levels and numerous legal entities, often face “system attenuation” and “responsibility gaps” during hierarchical enforcement of safety and ESG policies. The introduction of external suppliers and subcontractors with varying qualifications in infrastructure projects further complicates policy implementation.

Extend responsibility management to prevent ESG risks from propagating. If ESG systems cannot be effectively cascaded from top to bottom, risks will cascade from bottom to top. The Shanze Big Data Platform recorded 119 ESG risk events involving China Railway Construction, mostly related to its subsidiaries and subcontractors, with risks propagating through the chain, ultimately increasing the company’s ESG risk index. According to the Southern Weekly’s “2025 Yearbook of ESG Management Risks of Chinese Listed Companies,” among 2,160 listed companies exposed to ESG risks in 2025, China Railway Construction ranked second with an ESG risk index of 198.4.

With extensive operations, numerous subsidiaries, a long industry chain, and dense risk points, the complexity of its business increases the likelihood of ESG risks. Therefore, for large infrastructure companies, it is not enough to strengthen internal systems; they must extend ESG management throughout the supply chain, down to project sites. Key risk prevention measures include improving subcontractor management, on-site supervision, procurement of critical materials, and quality control, enhancing the precision of system management, and building a penetrating supervision system to prevent ESG risks from the supply chain from propagating upward.

Southern Weekly Researcher Hou Minghui

Editor: Sun Xiaowen