Application of Balanced Score Card in the Evaluation of

High-Quality Development of Environmental Service Industry:

A Case Study of Grandblue

Yan Wang

and Yunlang Xie

School of Accounting, Research Center for Accounting and Economic Development of Guangdong-Hong Kong-Macao

Greater Bay Area, Guangdong University of Foreign Studies, Guangzhou, China

School of Accounting, Guangdong University of Foreign Studies, Guangzhou, China

Keywords: Balanced Score Card, Environmental Service Industry, Quality Evaluation System.

Abstract: In 2016, the state proposed the “Five-sphere Integrated Plan” (a plan to promote coordinated economic,

political, cultural, social and ecological advancement) and the "Four-pronged Comprehensive Strategy",

which focus on environmental quality improvement, solve outstanding environmental problems and steadily

promote environmental protection. The “Outline of the 13th Five-Year Plan for National Economic and Social

Development” promulgated in March 2016 stated explicitly about “developing green environmental

protection industries, support technical equipment and service model innovation, and promote the

development and growth of energy-saving and environmental protection industries”. The “Ecological

Environment Protection Planning for the 13th Five-year Period” was released and implemented in the same

year. Under such backdrop, China’s environmental service industry has experienced a steady rise since 2016.

The scale of the industry continues to expand, the industry concentration and spatial pattern are basically

stable, the income grows steadily, the profit margin rises slightly, and the tax contribution continues to

increase, which has made significant contribution to national economic growth. This article will shift from

the macro industrial economy level to the micro corporate strategy level, exploit the Balanced Score Card to

formulate a set of quality evaluation system in line with the business scope and business philosophy of the

enterprise to accurately evaluate the quality of environmental service enterprises, which will facilitate the

high-quality development of the overall environmental service industry.

1 INTRODUCTION

With the advancing of economic globalization and

ecological globalization, international attention to the

environmental service industry has increased

simultaneously with the rapid economic development

and increased pressure of environmental pollution.

The environmental service industry has also become

the focus of general attention of domestic and foreign

scholars. Overseas scholars such as Goldman et al.

(2005) used data from the past ten years to conduct

empirical analysis on the trend of the US

environmental service industry, and concluded that

market-opening plans and government policy support

can promote the development of environmental

service industry (

Goldman et al., 2005). Gan et al.

(2009) further explored how to promote the

development of environmental service industry from

market development mechanism, standardization of

environmental service industry, and public

consumption awareness. At present, the definition of

environmental service enterprise in the international

community is not completely consistent. China

defines environmental service industry as service

trading activities related to the environment, and a

branch of modern service industry. It has been

occupying a large proportion in the statistical

classification of China’s producer service industry,

and taking an important position in the consumer

service industry (

Da-li G, 2009).

In our country, the development of environmental

protection industry is a great option for local

governments to promote the supply-side structural

reforms and expand high-quality incremental supply.

It is also an important support for the fight against

pollution prevention and control. In the future, with

the in-depth penetration of emerging technologies

504

Wang, Y. and Xie, Y.

Application of Balanced Score Card in the Evaluation of High-Quality Development of Environmental Service Industry: A Case Study of Grandblue.

DOI: 10.5220/0011954100003612

In Proceedings of the 3rd International Symposium on Automation, Information and Computing (ISAIC 2022), pages 504-517

ISBN: 978-989-758-622-4; ISSN: 2975-9463

 2023 by SCITEPRESS – Science and Technology Publications, Lda. Under CC license (CC BY-NC-ND 4.0)

such as big data, cloud computing, and artificial

intelligence, along with the guidance of the

government macroeconomic policies, the market

potential and development vitality of China’s

environmental service industry will be efficiently

improved. At present, although the market capacity of

the environmental service industry has expanded

significantly, the service content has been improved,

service capabilities enhanced, and service quality

elevated, the overall levels of development of the

industry is still low, with problems such as

unreasonable personnel structure, and weak

innovation capabilities. Therefore, it is necessary to

build a new environmental service industry

evaluation system to determine the service standards

through relevant indicators so as to enhance the

quality and efficiency of the environmental service

industry, and to achieve the goal of pollutant emission

reduction and fundamental improvement of

environmental quality with high-quality

environmental service standards.

2 DEFINITION OF RELATED

CONCEPTS AND LITERATURE

REVIEW

In this part, including the definition of related

concepts and literature review.

2.1 Definition of Related Concepts

The definition of environmental service industry,

Balanced Score Card and The Analytic Hierarchy

Process.

2.1.1 Environmental Service Industry

The definition and classification of the environmental

service industry abroad mainly include the following

versions: The Interim Core Product Classification

(CPC) issued by the United Nations in 1998 defines

the environmental service industry as including

sewage treatment services, waste disposal services,

sanitation services and other environmental services.

In 1999, the Organization for Economic Cooperation

and Development (OECD) and the European

Community Statistics Office (EUROSTAT) defined

environmental service industry as the measurement,

prevention, restriction, mitigation, and governance of

environmental damages related to water, air, soil,

waste, noise and ecosystems, which can be divided

into pollution treatment, clean technology and clean

products, and resource management. In 1991, the

General Agreement on Tariffs and Trade (GATS)

adopted the W/120 system to classify environmental

service industry, and proposed that the environmental

service industry should include sewage treatment

services, waste disposal services, sanitation services

and exhaust gas cleaning services, noise reduction

services, nature and landscape conservation services

and other environmental services. In 2000, the

European Union proposed a new classification of

environmental services in the World Trade

Organization (WTO), dividing environmental

services into core environmental services and

environment-related services. The core

environmental services are pure environmental

services, which falls into 7 categories: human water

consumption and sewage management, hazardous

solid waste management, air and climate protection,

soil and water restoration and cleaning, noise and

vibration reduction, biodiversity and landscape

protection, and other environmental services and

ancillary services. Environment-related services can

also be divided into 7 categories: business services,

R&D services, consulting services, contracting, and

engineering services, construction services,

distribution services, transportation services and

other services with environmental connotations.

Currently, the GATS classification of environmental

service industry is widely used by WTO and the

United Nations until now, while the classification

system of OECD and EUROSTAT for environmental

service industry is more advanced and complete.

China classifies the environmental service

industry by referring to the “2000 Communiqué on

the National Environmental Protection-Related

Industries” issued by the State Environmental

Protection Administration, which for the first time,

defines environmental service industry as service

trade activities related to the environment, and are

specifically divided into environmental technical

services, environmental consulting services,

operation and management of pollution control

facilities, recycling and disposal of waste resources,

environmental trade and financial services,

environmental functions and other environmental

services.

2.1.2 Balanced Score Card

The concept of Balanced Score Card (hereinafter

referred to as BSC) was first published in Harvard

Business Review in 1992 by Professor Robert Kaplan

of Harvard University and David Norton, the Director

of the Norton Institute in “The Balanced Score

Application of Balanced Score Card in the Evaluation of High-Quality Development of Environmental Service Industry: A Case Study of

Grandblue

505

Card—Measurement that Drive Performance”, and

this creative concept is a major breakthrough in

performance evaluation theory. At present, the

traditional Balanced Score Cards used in most studies

to evaluate performance have four dimensions:

financial dimension, customer dimension, internal

process dimension, and learning and growth

dimension. The four dimensions are used to transform

the company’s strategic goals into feasible indicators

for quantitative analysis, which focus on the current

performance evaluation and adjust the company’s

future production and operation and activities. BSC is

applied to the specific activities of the company to

help the company achieve its strategic goals.

2.1.3 Analytic Hierarchy Process

The Analytic Hierarchy Process (hereinafter referred

to as AHP) is a decision-making method that

decomposes the elements that are always related to

the decision into goals, guidelines, and plans, and

performs qualitative and quantitative analysis on this

basis. This method is a hierarchical weighted decision

analysis method proposed by the American

operations researcher Professor Satie of the

University of Pittsburgh in the early 1970s.

2.2 Literature Review

Judging from the existing research on the

environmental service industry, currently overseas

researches mainly focus on the payment for

environmental service, while domestic researches

look into perspectives including the status quo of the

environmental service industry, the experience drawn

from the development of the environmental service

industry, and how to push forward the development

of the environmental service industry.

Foreign scholars mainly study payment for

environmental services. The research perspectives

include the power and influence of payment methods

of environmental services on environment protection,

agricultural development, and economic

development. “Payment for Environment Service”

(PES) is also called “Payment for Ecosystem Service”

or “Payment for Ecological Service” (collectively

known as “Payment for Ecosystem Service”).

Wunder (2005) believes that the significance of PES

is that the environmental service beneficiaries make

conditional and contractual payments to the service

suppliers, so that the latter can continue to take

actions to protect and restore the ecological

environment system. This should involve voluntary

transactions, defined ecosystem services, at least one

environmental service purchaser and one

environmental service provider, and the

environmental service provider must provide

environmental services (

Wunder S, 2005). Huang

(2007) proposed to define environmental services,

which means that it is necessary to determine the

subjects of relevant environmental services, including

the suppliers, demanders and intermediaries, and

establish the payment mechanisms (including

payment methods, transaction costs, contract

duration, and sources of payment) and relevant laws

and regulations (

Huang M et al., 2007).

In the recent decades, international organizations

have promoted many conservation projects to resolve

environmental problems worldwide. For example,

institutions such as the World Bank (wb), the Food

and Agriculture Organization of the United Nations

(fao), the United Nations Environment Programme

(unep), the Global Environment Fund (gef) and the

International Development Bank (idb) have

developed guidelines for public environmental

policies for countries committed to environmental

protection. It is worth noting that those projects have

facilitated related initiatives between non-

governmental organizations and some private

companies (wunder et al., 2008). Generally speaking,

these projects set to promote environmental

protection through market mechanisms such as

compensation, incentives and payments (Rodríguez

et al. 2011). In particular, projects that provide

incentives or compensation for environmental

protection services, namely, payment for

environmental services or payment for ecosystem

services, are important mechanisms that promote

social, economic and environmental sustainability,

especially in rural areas (Maciel et al., 2014). In

developing countries, governments do not have

enough funds to pay for environmental service

projects, and therefore the lack of available funds is

another crucial limitation (Wunder et al., 2008).

Sometimes, in areas where the market is missing, the

opportunity cost or the willingness to pay is uncertain,

the payment of environmental service fees is even

found to be ineffective for environmental protection

(Pattanayak et al., 2010). The above restrictions will

abate the efficiency of payment for environmental

service, thus hampering the goals of the

environmental service payment plan. In this case,

efficiency refers to the extent to which the paid

environmental service programs achieve the

environmental protection goals with minimal social,

economic or environmental costs (Jost and Gentes,

2014).

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As for domestic researches on the status of

environmental service industry, Liu Xiaobing et al.

(2015) studied the development status of China’s

environmental service industry and concluded that

China’s environmental service industry has seen

considerable development since 2000, while the scale

was still very small compared with that of the

developed countries and the development was also

uneven between the East and the West of China (

Liu

et al., 2015). Chai Weishu et al. (2017) analyzed the

data from 2012 to 2016 in terms of the overall scale

of environmental services, industry concentration and

industry spatial pattern and the status of the industry

main body, and concluded that the environmental

service industry had made a significant contribution

to the growth of the national economy during 2012

and 2017, and that the market potential and vitality of

the environmental service industry would be further

explored with the deepening of supply-side structural

reforms, the upgrading of environmental protection

supervision and law enforcement and policy support

(

Chai et al., 2017). When Wang Yanhua et al. (2018)

explored the investment in environmental protection

industry, they found that the distribution of China’s

environmental service industry was the same as that

of the environmental protection industry, which was

quite unbalance. China’s environmental protection

industry is mainly concentrated in the Bohai Rim, the

Yangtze River Economic Belt and the Pearl River

Delta, while the environmental service industry is

mainly situated in the Beijing-Tianjin-Hebei region,

the Yangtze River Delta and the Pearl River Delta

(

Wang et al., 2018).

Regarding the experience reference for the

development of the environmental service industry,

Gao Ming and Hong Chen (2014) referred to the

enlightenment of the development of the US

environmental protection industry and mentioned that

the export of environmental protection products

should be encouraged and the government’s role in

the international trade of environmental protection

industry should be strengthened. The government

must remove all the barriers for the environmental

protection industry in participating in international

competition, provide export information services,

reduce, or exempt export tariffs, and simplify the

administrative procedures. At the meantime, the

government need to fight for the rights and interests

of environmental protection companies in

international organizations, integrate environmental

diplomacy with environmental trade, and utilize

government assisted project to Africa to drive the

export of environmentally friendly products (

Gao M,

Hong C 2014

). Jia Ning and Ding Shineng (2014)

proposed to learn from the successful experience of

Japan and South Korea in the development of

environmental protection industry. Compared with

European and American countries, the environmental

protection technologies of Japan and South Korea are

easier to transform and absorb by China. In the future,

we need to make full use of the environmental

protection industry cooperation platform of Japan and

South Korea, increase the investment in science and

technology, and explore the development path of

environmental protection industry to “go global” (

Jia

N, Ding S 2014).

Regarding how to promote the development of the

environmental service industry, Xia Jiechang and

Zhang Yingxi (2010) emphasized the necessity to

cultivate public awareness when discussing the

development path of the industry in China. By

adopting multi-level environmental education, the

public’s awareness of environmental protection will

be strengthened, which helps to form a benign

interaction between the public, government and

enterprises, lays a foundation for policy formulation,

and creates a favorable market and public opinion

atmosphere for the development of the industry (

Xia

J, Zhang Y 2010

). Li Ying et al. (2012) mentioned that

to promote the development of China’s

environmental service industry, it is necessary to

implement environmental services contract (ESC).

The essence of ESC is the business method of paying

the full costs of environmental protection projects in

the form of contracts with the payment standard built

upon the environmental protection performance. ESC

goes in two forms: 1) polluting companies share the

saved emission reduction costs with environmental

service providers through the environmental service

contract, which is similar to energy contract services

in structure; 2) the government pays for the

environmental services provided by the

environmental services providers through fiscal

payment in government activities (

Li et al., 2012). Liu

Naichao (2014) also explored the development path

of China’s environmental service contract, and was

convinced that the “environmental contract services”

model could be a new way of environmental

governance integrating voluntary actions and market

mechanism, and environmental service contract has

become an important governance model from urban

and rural waste treatment, sewage treatment to air

treatment, etc., and it plays a positive part in the

improvement of environmental governance. In

addition, sustainable development of environmental

service contract is mainly achieved through

government supervision and fiscal and tax policy

support which strengthens the market order (

Liu N

Application of Balanced Score Card in the Evaluation of High-Quality Development of Environmental Service Industry: A Case Study of

Grandblue

507

2014). Wu Na et al. (2020) put forward several

strategic suggestions when evaluating the

development level of our environmental service

industry, for instance expanding the scale of

environmental service enterprises, and guiding small

and micro enterprises to develop differentiated,

specialized and refined services while focusing on the

cultivation of a group of leading enterprises. In

addition, improving the technological innovation

capabilities of environmental service companies and

introducing environmental technology talents are also

crucial to the development of environmental service

enterprises (

Wu et al., 2020). Xin Lu et al. (2020) used

the South China Cluster of the National

Environmental Service Industry as an example to

analyze policies that promote the innovation and

entrepreneurship of environmental protection

industrial parks. They mentioned that promoting

environmental protection requires the establishment

of environmental protection industry funds, and the

innovation of environmental protection industry

financing guarantee methods, etc. we need to

vigorously develop environmental finance services

and enhance the vitality of the industry, give full play

to the government’s guidance, support and positive

role, establish a government-led fund for the

development of environmental protection industry,

and enhance the potential for industrial development

(

Xin et al., 2020).

3 CASE COMPANY

INTRODUCTION

Grandblue is a listed company engaged in

environmental protection services, headquartered in

Nanhai District, Foshan. Since its listing in 2000,

Grandblue has developed from a local municipal

utility company to a large national comprehensive

environmental service company. Its main business

areas include solid waste treatment, and energy, water

supply and drainage. It has evolved from a company

that provides simply water supply service for certain

areas of Foshan to a comprehensive environmental

service company that provides integrated “waste-free

city” solutions for multiple cities across the country.

Jin Duo, the president of Grandblue, said in an

exclusive interview with our reporter that Grandblue

initially expanded the “border” of its business by

acquiring a waste incineration company in 2006. This

waste treatment plant was strongly resisted by the

people around because of the bad smell, black smoke

from chimneys, sewage and terrible noise, and it got

on the black list of the Ministry of Environmental

Protection. “A company engaged in environmental

protection business has encountered hostility and

resistance from the surrounding residents because it

has never been environmental-friendly and it is not

responsible for the community environment and its

employees. The company was on the verge of

bankruptcy and the hearts of the employees were

extremely disintegrated.” Jin Duo said like that when

he recalls that company. It seems that he his mind has

flied back to fifteen years ago, “After we took over,

we began to think about how to do things right from

the scratch”. When the reporters come to the original

site of that company, it has been completely

different—a building full of artistic design stands

among shady trees, chic landscape and fresh grass,

and two-hundred-meter-high chimneys stand like

crystal columns, beautiful and refreshing. Standing in

front of this building designed by the Atkins design

team, the designer of seven-star Burj Al Arab Hotel

in Dubai’s, one can hardly associate it with garbage

incineration, and this reborn area also gets a new

name—Nanhai Solid Waste Treatment and

Environmental Protection Industrial Park.

4 EVALUATION AND ANALYSIS

OF HIGH-QUALITY

DEVELOPMENT BASED ON

THE BALANCED SCORE CARD

This part is about the evaluation and analysis of high-

quality development based on the Balanced Score

Card.

4.1 A Five-Dimensional Balanced Score

Card

The concept of Balanced Score Card (hereinafter

referred to as BSC) was first published in Harvard

Business Review in 1992 by Professor Robert Kaplan

of Harvard University and David Norton, the Director

of the Norton Institute in “The Balanced Score

Card—Measurement that Drive Performance”, and

this creative concept is a major breakthrough in

performance evaluation theory. At present, the

traditional Balanced Score Cards used in most studies

to evaluate performance have four dimensions:

financial dimension, customer dimension, internal

process dimension, and learning and growth

dimension. The four dimensions are used to transform

the company’s strategic goals into feasible indicators

for quantitative analysis, which focus on the current

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performance evaluation and adjust the company’s

future production and operation and activities. BSC is

applied to the specific activities of the company to

help the company achieve its strategic goals.

When Chen Xu et al. (2020) studied the strategy-

oriented combination of the BSC and key

performance indicators, they took W company as an

example, combined with W company’s unique

corporate mission “Green-technology Driven and

International-Oriented” and expanded the four-

dimensional BSC with another non-financial

dimension—“Social Responsibility Dimension” to

reflect the corporate social responsibility

performance, which is consistent with the “Green-

technology Driven and Sustainable Development”

philosophy advocated in W company’s strategy [21].

The company studied in this article, Grandblue is a

social service enterprise for solid waste treatment, gas

and new energy supply. It takes “building a

harmonious life between man and nature” as its

corporate mission and upholds “a good housekeeper

for the city, a good model for the industry, and a good

neighbor in the community”, with the vision to

become a leading eco-environmental service

provider, therefore the traditional four-dimensional

BSC model can no longer cover the business strategy

of the company (

Chen X et al., 2020). Lin Hongmei et

al. (2020) studied the relationship between the tenure

of executives and corporate social responsibility, and

made the point that corporate social responsibility

was the responsibility that enterprises would

undertake beyond the interests of the company and

legal requirements, including environmental

responsibility, consumer rights and interests, social

donations and social contribution value per share and

many other aspects. The fulfillment of social

responsibilities by enterprises not only propels the

sustainable and balanced development of the

enterprises and the society, but also shapes the

company’s image to a large extent (

Lin et al., 2020).

The 19th National Congress of the Communist Party

of China also proposed to “promote the construction

of integrity and institutionalization of voluntary

services, and strengthen the awareness of social

responsibility, rules, and dedication”. Corporate

responsibilities include responsibilities to the

country, the society, the investors, the consumers and

the public, the employees, and the environment, etc.

(Liu Junhai and Chai Weiwei, 2018). Deng Mingwen

and Yu Zhihong (2020) mentioned that “corporate

social responsibility is not cost but competitiveness

and the driving force of enterprise development”

when studying the sustainable practices of

Grandblue’s environmental contribution to a waste-

free city. It is precisely by fulfilling its social

responsibilities, can Grandblue build business

advantages, and improve corporate profitability while

creating diversified value for the society (

Deng M, Yu

Z 2020

4.2 Enterprise Strategy Map and Index

Evaluation System

With the help of the five-dimensional BSC, the

company’s strategic goals can be subdivided into sub-

goals at different levels within the five dimensions,

with each level pointing out the specific problems that

the company must solve in order to achieve the

strategic goals and vision. Based on the reconstructed

five-dimensional strategic map shown as follows,

combining the characteristics of the industry and

business philosophy of Grandblue, as well as its

future strategic goals, the indicators that can most

accurately measure the service performance of

Gramdblue are selected to ensure the fairness of

subsequent weight determination. There are 5

indicators in each dimension, with 25 indicators in the

system in total. The strategy map and indicator

evaluation system go as follows (Figure 1 & Table 1).

Figure 1: Strategic Map.

4.2.1 Financial Dimension

The key to realize Grandblue’s strategic goal of

financial dimension of is to satisfy the shareholders

and maximize the shareholders’ interests, and

secondly, consider the preferences of external small

and medium investors. The author has selected

several indicators that can best reflect the interests of

shareholders and are of prior concern of external

Mission &

strategy

Learning & Growth Dimension

What should we do to maintain a

High-quality talent pool?

Social responsibility dimension

How can we fulfil our social

responsibilities in order to

strengthen trust mechanisms?

Customer Dimension

What should we offer our

customers in order to meet their

diverse needs?

Internal Process Dimension

What innovations should we make to

improve business process

efficiency?

Financial Dimension

What are the specific objectives to

be achieved in order to enhance

the effectiveness of environmental

services?

Application of Balanced Score Card in the Evaluation of High-Quality Development of Environmental Service Industry: A Case Study of

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509

small and medium investors. The first indicator is

weighted average return on equity. It is known that

the rate of return on net assets is the most

representative indicator for evaluating the level of

remuneration acquired by a company’s own capital

and its accumulation, and the weighted average can

better reflect the return on net assets in the entire year

and avoid short-term fluctuations caused by

uncertainties such as accidental events in the market,

followed by basic earnings per share to evaluate the

company’s profitability. The cash dividend

distribution ratio reflects the company’s dividend

policy and dividend payout rate. Those two indicators

are also important indicators for shareholders and

investors to decide whether to invest or not; finally,

the interest coverage ratio is taken to measure the

company’s long-term solvency which can measure

the security of corporate debenture capital, and the

loan repayment rate is used to evaluate the company’s

credit standing and capital turnover.

4.2.2 Customer Dimension

To achieve the goal of customer dimension,

Grandblue must always take customer satisfaction as

a guideline for production and operation, and take

customer demand as the direction for enterprise

development. The rate of new customer acquisition

represents a company’s business capabilities and

brand awareness. Due to the diversification and wide

distribution of customers, as well as the differences in

the standards for solid waste treatment, water and

power supply and other services in different regions,

Grandblue must provide diversified and customized

products and services to meet the personalized

requirements of different customers. Publicity and

promotion expenses refer to the company’s

investment in brand promotion, which reflects the

company’s emphasis on maintaining old customers

and long-term customers, and acquiring new

customers. Information disclosure evaluation, project

acceptance rate, and after-sales service timeliness

ratio all reveal the company’s transparency on its own

service quality and quality assurance to increase

customers’ trust in its products and services.

4.2.3 Internal Process Dimension

As a service enterprise engaged in solid waste

treatment and water and power supply, the internal

process of Grandblue determines its production

efficiency, product quality and service efficiency. To

achieve the strategic goals of the internal process

dimension of Grandblue, firstly, investment in safety

production reflects the company’s attention and

control of the safety of production process. Only by

keeping safety as the bottom-line can Grandblue talk

about strategy and development; secondly, the

company’s industrial output energy consumption

level and energy loss rate represent the economic

benefits of enterprise energy. A reasonable proportion

of R&D investment is a prerequisite to technological

breakthroughs. The acceleration of the modernization

process makes environmental protection more

challenging. Therefore, Grandblue must increase

R&D investment, accelerate the formation of core

competitiveness, and achieve breakthroughs in core

technologies. And the pollutant treatment capacity is

the guarantee of the business capacity of a solid waste

treatment company.

Table 1: Innovation Performance Index Evaluation System

of Gandblue.

First-level

evaluation

dimension

Secondary evaluation index

Financial

dimension (A)

Weighted average return on equity

(A1)

Cash dividend distribution ratio (A2)

Loan repayment rate (A3)

Basic earnings per share (A4)

Interest coverage multiple (A5)

Customer

dimension (B)

New customer acquisition rate (B1)

Promotion fee ratio (B2)

Evaluation of Information Disclosure

(B3)

Project acceptance rate (B4)

Timeliness ratio of after-sales service

(B5)

Internal

process

dimension (C)

Proportion of R&D investment (C1)

Energy consumption of industrial

out

ut value

(

)

Energy loss rate (C3)

Safety production investment (C4)

Pollutant treatment capacity (C5)

Learning and

growth

dimension (D)

Staff training coverage rate (D1)

Proportion of highly educated

ees

(

)

Proportion of female managers (D3)

Occupational disease incidence (D4)

Social insurance coverage rate (D5)

Social

responsibility

dimension (E)

Social contribution value per share

(

)

Hazardous waste treatment efficiency

(

)

Charity donation (E3)

Tax payment (E4)

Volunteer service frequency (E5)

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4.2.4 Learning and Growth Dimensions

The strategic goal of the learning and growth

dimension is to develop long-term core

competitiveness to provide consumers with better

services. On the one hand, Grandblue needs to

cultivate core technical talents, management talents

and other resources that can help realize the long-term

development of the company. In addition, employee

training, the introduction of highly educated talents,

and the proportion of female managers can all reflect

the company’s emphasis on high-end talents; on the

other hand, it is necessary to provide better living

guarantee and employee benefits to reduce brain

drain. For example, employees in solid waste

treatment-related positions must undergo regular

occupational disease inspections to increase social

insurance coverage.

Table 2: AHP 1~9 Scale Description.

Scaling Connotation

1 Both elements are equally important

The former is slightly more important

than the latter

The former is obviously more

important than the latter

The former is more important than the

latte

The former is extremely important

than the latter

2, 4, 6, 8

The median value of the above

adjacent judgment

Count

backwards

If the importance ratio of element A to

element B is a, then the importance

ratio of element B to element A is 1/a

Table 3: Description of the score sheet.

Index

1 A/B A/C A/D A/E

Index

B/A 1 B/C B/D B/E

Index

C/A C/B 1 C/D C/E

Index

D/A D/B D/C 1 D/E

Index

E/A E/B E/C E/D 1

4.2.5 Social Responsibility Dimension

Grandblue adheres to the corporate mission of

“building a harmonious coexistence between man and

nature”, which requires the company to strengthen

trust mechanism by enhancing the sense of social

responsibility and fulfilling the social responsibilities.

First of all, it emphasizes the improvement of energy

utilization efficiency, saving energy and reducing

consumption, for instance improving the efficiency of

hazardous waste treatment; secondly, in terms of

social contribution, Grandblue should actively pay

taxes to increase the social contribution value per

share. The frequency of charity donations and

volunteer services not only represent the company’s

social image, but also give back to the society in

diversified forms.

4.3 Determination of Indicator Weights

This article aims to measure the performance of

Grandblue’s environmental service business, and

adopts the analytic hierarchy process to determine the

weight of each indicator in the performance

evaluation system. First, combined with the 1~9

grade scoring method, develop a BSC with five

dimensions, making a questionnaire that compares

the relative importance of any two evaluation

indicators of the five dimensions, invites ten experts

to rate the relative importance of the indicators in the

comprehensive performance evaluation system, and

then performs data processing through software such

as yaanp to obtain the quantified judgment matrix,

later use the square root method to calculate the max-

Eigen (hereinafter referred to as λmax) and the

eigenvector (hereinafter referred to as Wi) of the

matrix. The specific weight determination process

goes as follows:

a. Design a questionnaire. The table is divided into

two parts: 1) the scoring table for the comparison of

the importance of specific indicators in the five

dimensions; 2) the scoring table for the comparison

of the relative importance among the five dimensions.

The description of the nine-level scoring standards

and scoring table goes as Table 2 & Table 3.

b. Distribute questionnaires. This time, ten

enterprise experts were invited to give the score, and

6 valid scoring tables were recovered, and statistics

were made based on the scoring results.

c. Construct a judgment matrix. Take the average

value of the scoring results of all valid questionnaires

and use it as the relative importance level scores of

the five dimensions and each index to obtain the

judgment matrix after aggregation.

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Table 4. Average random consistency index.

n 1 2 3 4 5 6 7 8 9

RI 0 0 0.52 0.89 1.12 1.26 1.36 1.41 1.46

Table 5. Analysis results of the dimensional index weight (expert A).

Dimensions (A) (B) (C) (D) (E) Weight λmax CI RI CR

(A) 1 1/3 3 7 7 26.16%

5.387 0.097 1.12 0.086

(B) 3 1 6 8 8 51.71%

(

)

1/3 1/6 1 5 7 14.34%

(

)

1/7 1/8 1/5 1 2 4.49%

(E) 1/7 1/8 1/7 1/2 1 3.30%

Table 6. Analysis results of the dimensional index weights (Expert B).

Dimensions (A) (B) (C) (D) (E) Weight λmax CI RI CR

(A) 1 1/3 1/3 1 1 9.80%

5.295 0.074 1.12 0.066

(B) 3 1 3 3 3 41.12%

(D) 1 1/3 1/5 1 1 9.02%

(E) 1 1/3 1/5 1 1 9.02%

Table 7. The analysis results of the dimensional index weight (Expert C).

Dimensions (A) (B) (C) (D) (E) Weight λmax CI RI CR

(A) 1 1/5 1/6 1/7 1/3 3.75%

5.359 0.090 1.12 0.08

(B) 5 1 1/2 1/5 3 13.93%

(D) 7 5 5 1 6 54.97%

(E) 3 1/3 1/4 1/6 1 6.92%

Table 8. The analysis results of the dimensional index weight (Expert D).

Dimensions (A) (B) (C) (D) (E) Weight λmax CI RI CR

(A) 1 3 1/2 6 6 28.80%

5.366 0.092 1.12 0.082

(B) 1/3 1 1/6 4 6 14.74%

(D) 1/6 1/4 1/6 1 2 5.60%

(E) 1/6 1/6 1/6 1/2 1 4.09%

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Table 9. The analysis results of the dimensional index weight (Expert E).

Dimensions (A) (B) (C) (D) (E) Weight λmax CI RI CR

(

)

1 3 1/4 8 3 22.37%

5.343 0.086 1.12 0.077

(B) 1/3 1 1/6 6 2 11.72%

(D) 1/8 1/6 1/8 1 1/4 3.12%

(

)

1/3 1/2 1/7 4 1 7.75%

Table 10. The analysis results of the dimensional index weight (Expert F).

Dimensions (A) (B) (C) (D) (E) Weight λmax CI RI CR

(A) 1 4 6 1/2 6 30.75%

5.418 0.106 1.12 0.093

(B) 1/4 1 4 1/6 6 13.93%

(D) 2 6 6 1 6 45.79%

(E) 1/6 1/6 1/2 1/6 1 4.04%

Table 11. The analysis results of dimensional indicators weight after aggregation.

Dimensions (A) (B) (C) (D) (E) Weight

(A) 1 5/6 5/7 1 3 1/2 20.27%

(B) 1 1/5 1 6/7 1 1/5 4 1/5 24.52%

(D) 1 5/6 5/7 1 3 1/2 20.50%

(E) 2/7 1/4 1/5 2/7 1 5.85%

Table 12. Innovation Performance Indicator Evaluation System of Gandblue

Primary evaluation

dimensions

Weight Secondary evaluation index Weight

Financial dimension (A) 20.27%

Weighted average return on equity (A1) 5.25%

Cash dividend distribution ratio (A2) 3.17%

Loan repayment rate (A3) 3.41%

Basic earnings per share (A4) 5.00%

Interest coverage multiples (A5) 3.43%

Customer dimension (B) 24.52%

New customer acquisition rate (B1) 8.02%

Promotion fee ratio (B2) 2.82%

Evaluation of Information Disclosure (B3) 2.40%

Project acceptance rate (B4) 6.50%

Timeliness ratio of after-sales service (B5) 4.79%

Internal process dimension

(C)

28.85%

Proportion of R&D investment (C1) 6.54%

Energy consumption of industrial output value

(C2)

5.04%

Energy loss rate (C3) 5.03%

Application of Balanced Score Card in the Evaluation of High-Quality Development of Environmental Service Industry: A Case Study of

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513

Safety production investment (C4) 4.97%

Pollutant treatment capacity (C5) 7.28%

Learning and growth

dimension (D)

20.50%

Staff training coverage rate (D1) 4.84%

Proportion of highly educated employees (D2) 4.63%

Proportion of female managers (D3) 1.06%

Occupational disease incidence (D4) 2.40%

Social insurance coverage rate (D5) 7.58%

Social responsibility

dimension (E)

5.85%

Social contribution value per share (E1) 1.94%

Hazardous waste treatment efficiency (E2) 1.72%

Charity donation (E3) 0.50%

Tax payment (E4) 1.28%

Volunteer service frequency (E5) 0.40%

d. Calculate the weighted value. In this paper, the

geometric average method is used for calculation.

And the specific steps are shown as follows:

Step 1 calculate the product of elements in each

row of the judgment matrix.



∏

αij





i,j = 1,2,3⋯, n, n: Order of

Matrix

(1)

Step 2 calculate the n root of w



, the geometric

mean.

𝑤







𝑤





(2)

Step 3 Normalize the vector to get the required

feature vector 𝑤





Step 4 Calculate the maximum eigenvalue λmax.

max =



(Aw)











(3)

Where: (Aw)



is the i-th element of the vector, where

A is the judgment matrix; n is the dimension of the

matrix.

Step 5 Calculate the consistency index and

conduct a consistency test.

Check the corresponding average random

consistency index RI (RI is the average value of the

consistency index of the random judgment matrix of

the same order). The introduction of RI will suppress

the drawbacks that the consistency judgment index of

will increase significantly with the increase of n to a

certain degree. See the following Table 4 for details:

Calculate the consistency index CI and the

consistency ratio CR according to the maximum

eigenvalue calculated in the above steps. The

calculation formula is listed as follows. If the

consistency ratio CR<0.1, the consistency

requirement is met, and the aforementioned weight

vector can be used.

Step 6 Check the validity of expert data.

A total of 6 valid expert scoring scales have been

retrieved, and the validity of expert data is tested by

taking expert A’s data as an example. It can be seen

from Tables 1-6 that CI = (λmax-n) / (n-1), and

therefore CI=0.097<0.1; CR=CI/RI, so

CR=0.086<0.1; under such circumstance, this

judgment satisfies the consistency test. It can be seen

that the scoring result of expert A satisfies the

consistency test and can be used as the source data to

calculate the dimensional weight after aggregation,

the same below, like the following tables 5-10.

Step 7 The Results of Analytic Hierarchy Process

calculation results.

A total of 6 valid expert scoring scales have been

retrieved. After data processing and calculation of the

scorings, the final judgment matrix is obtained after

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the aggregation of expert data, and the results of

weight of each primary dimension and the weight of

the secondary indicators are obtained. The details are

shown in Table 11 & Table 12.

5 ANALYSIS OF SPECIFIC

INDICATORS AND THE

WEIGHTS

Seen from the weight of the dimension level in the

above indicator weight table, it can be seen that the

weight of the internal process dimension (C) is

28.85%, which takes the largest proportion of the five

dimensions. As a company that provides solid waste

treatment, water supply and drainage service, the

realization of Grandblue’s overall development

strategy is directly affected by the internal process.

Good and efficient internal operations are helpful for

the realization of the company’s long-term strategic

goals. Among the five dimensions of the internal

process, pollutant treatment capacity (C5) accounts

for the largest proportion, this means that the business

capacity of the company is always in the first place in

the development of the company. Grandblue must

always place the improvement of business

capabilities before financial performance in its

operations, rather than blindly pursue financial

returns; secondly, we can evaluate the enterprise’s

emphasis on innovation, innovation output and

innovation efficiency through the internal process

dimension. The proportion of enterprise R&D

investment (C1) is inseparable with service quality.

The innovation capability of an enterprise can be

improved through internal R&D and external

integration. The case company Grandblue has

achieved mixed ownership mergers and acquisitions

with a number of external companies, integrated

existing resources, achieved synergy between the

technology and resources, and improved the input-

output ratio, which is the energy consumption of

industrial output value (C2), and production and

operation efficiency, which is pollutant treatment

capacity (C5). Therefore, when improving the

internal process efficiency of environmental service

enterprises, it is necessary to combine the efficiency

of production lines with that of R&D and innovation

to achieve coordinated development and jointly

elevate the company’s hard power.

The second is the customer dimension (B). The

proportion of customer dimension is second only to

the internal process dimension, which coincides with

the state-owned background of Grandblue whose

vitality is determined by the big customers, while the

new customer acquisition rate (B1) bring in a steady

stream of new customers so as to keep the vitality of

the company. The service quality of Grandblue, such

as the project acceptance rate (B4) and the timeliness

rate of after-sales service (B5), are the basic guarantee

for the company to acquire new customers and

maintain old customers. By establishing a good image

through high-quality services, the company manages

to expand their market share and forge ahead towards

a leading environmental service company across the

country from a local state-owned enterprise.

Then there is the learning and growth dimension

(D). Grandblue shall actively innovate and give full

play to the core competitiveness generated by

innovation in its gas and new energy supply business

to seize the market share in new energy sector. The

training and cultivation of advanced talents is a

prerequisite for the formation of core

competitiveness. On the one hand, the company must

implement various supporting measures, for example

expanding social insurance coverage rate (D5),

maintaining steady growth of investment in employee

guarantee and welfare, and upgrading the supporting

system to reduce employee turnover and attract

outstanding talents, and improving the proportion of

highly educated employees (D2); on the other hand,

it is necessary to improve the staff training coverage

rate (D1) in accordance with their aptitude, allocate

positions reasonably according to different job

requirements and the characteristics of the talents,

and improve the overall quality of employees.

Through talent reserve, the company can form a

stable R&D team to improve its R&D level and

greatly enhance the core competitiveness of the

company; moreover, the company can also form a

virtuous circle with technological innovation to

achieve synergy in its development by actively

fulfilling its responsibilities towards the employees.

The next is the financial dimension (A). Financial

performance is the foundation for the survival of the

company. The weighted average return on equity

(A1) and basic earnings per share (A4) of a company

are indicators based on which the shareholders and

investors make judgment on the company’s

management level. In addition to high-quality

services and quality assurance, companies should

strengthen the construction of internal control system

and hire high-level and experienced management

talents. What is more, companies should also

establish a reasonable performance evaluation

indicator system, and make objective judgments on

the company’s business achievements and strategy

implementation through more accurate quantitative

Application of Balanced Score Card in the Evaluation of High-Quality Development of Environmental Service Industry: A Case Study of

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515

and qualitative analysis, which will guide the

company’s business operations and improve the

company’s financial performance.

Finally, there is the social responsibility

dimension (E). Grandblue cannot neglect its social

responsibilities in order to achieve its strategic goals,

for instance actively paying the taxes (E4) and

improving the trust mechanism of the company.

Grandblue takes “three good and three sharing and

kind-hearted Grandblue people (good housekeeper in

the city, good model in the industry, good neighbors

in the community, and sharing of wealth, capabilities

and values)” as the core values, and internalizing it

social responsibilities, which has become

Grandblue’s unique core competitiveness and

distinctive brand characteristics in the environmental

service industry. The leading position of Grandblue

in the industry also requires the company to perform

its social responsibilities more actively, strengthen

the public trust in the company and create more value

for the society. In the future, the company should

extend the scope of its social responsibilities, engage

more in public welfare activities (E5), and strive to

become a trusted and well-reputed eco-environmental

service provider and a partner of the government and

the public.

6 CONCLUSIONS AND

ENLIGHTENS

This author has used the five-dimensional Balanced

Score Card (BSC) to construct a performance

evaluation indicator system for environmental service

companies in our country, and revised and adjusted

the evaluation indicator system of traditional

Balanced Score Card to make the evaluation system

more suitable for environmental service companies.

The author further explores the application of the

Balanced Score Card in promoting the high-quality

development of environmental service enterprises by

integrating the industry mission and business strategy

of the environmental service company. Seem from

the dimensional weights determined by the analytic

hierarchy process, environmental service companies

should focus on improving the relevant indicators

related to the internal process dimensions in their

future operations and development, for example,

further increase the R&D investment in the

environmental service industry, especially in water,

solid waste, hazardous pollutant treatment and other

fields, to ensure the efficient research and

development of environmental protection

technology, and enhance the market competitiveness

of enterprises through the improvement of

technological innovation capabilities; secondly,

enterprises should pay attention to the improvement

of customer dimension and learning and growth

dimension, and actively expand the business scope

and cultivate a group of superior talents with core

competitiveness; and finally, enterprises should not

forget their original aspirations and actively assume

social responsibilities while focusing on the growth

of corporate financial indicators, since fulfillment of

social responsibilities is no longer a cost but a part of

the competitiveness of the enterprises.

In a long period in the future, China’s green

production and lifestyles and concepts will be

increasingly popularized, and the proactive fiscal and

taxation policies and prudent monetary policies will

be implemented continuously to promote the

effective release of the market capacity of ecological

environmental governance, and the market potential

and vitality of the environmental service industry is

expected to be further exploited. The deep penetration

of emerging technologies such as big data, cloud

computing, and artificial intelligence will improve the

level of intelligence and efficiency of the

environmental service industry, as well as the supply

capacity of the entire industry.

ACKNOWLEDGMENTS

First of all, the first author is grateful for being the

chief expert in the 2021 National Major Project

(ongoing) “Research on Mechanism Innovation and

Practice Path of Deepening Mixed Ownership

Reform (21ZDA039)” of the National Office of

Philosophy and Social Sciences and the authors

thanks for the support from it. Secondly, The authors

thank the grant from the Chinese National Social

Science Fund Granted Project of China (Grant:

20VSZ006); Thirdly, the authors appreciate the

support from the project of “The Research on

Comprehensively Promoting Urban Digital

Transformation in Guangzhou (2022GZZK06)” of

the 14th Five-Year Plan for the Development of

Guangzhou Philosophy and Social Sciences in 2022,

and thank to the support of the 2022 project "ESG

(environment, social and governance) Report on the

impact of the Certified Public Accountants industry".

Moreover, the authors also want to give the

appreciation to the support of these two projects: the

2022 Industry research project of the Guangdong

Institute of Certified Public Accountants

"Guangdong-Hong Kong-Macao Greater Bay Area

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516

Accounting Firms to Promote ESG Information

Disclosure" and the 2023 Guangdong Institute of

Certified Public Accountants industry research

project (ongoing) "Comprehensive Evaluation of

Public Accountants".

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