The green development of an enterprise is of great significance for sustainable development, and the environmental risk of an enterprise is the key problem of green development. The environmental risk of an enterprise refers to the impact on the environment and possibility of accidents. Among the potential threats for the environment are emissions, wastes, and resource depletion generated during the production process. In recent decades, the rapid development of newly industrialized countries represented by BRICS countries has inevitably led to increased pollution and deterioration of environmental quality in related countries. There are more and more studies of the environmental risks on enterprises, especially industrial enterprises. In 2014, the GDP of BRICS countries accounted for 21.85% of the total global GDP, while carbon dioxide emissions accounted for 42.21% of the total global emissions. Global carbon project statistics shows that in 2016, Russia ranked fourth, Brazil and South Africa took twelfth and thirteenth place respectively [Xinjing, Baohua, 2018; National environmental protection.., 2019].

China’s carbon emissions rank first in the world while India ranks third, indicating that there is still a lot of room for industrial environmental improvement. China’s total environmental protection investment is continuously increasing, and its share of GDP has gradually stabilized by about 1.4%. During the tenth five-year plan period, the proportion was 1.16%, and during the twelfth five-year plan period, the proportion rose by 1.43%. Judging from the current international experience, environmental protection investment accounted for 1-1.5% of the country (region)’s total economy that year, indicating that the country (region) was only at the stage of basic control of environmental pollution. China’s environmental governance goal is to improve environmental quality, that is, the proportion should reach 2-3%. It can be seen that the scale of China’s environmental protection investments still needs further expansion. This article describes China, which has the fastest economic growth and the highest pollution rate among BRICS countries. As an example, it has to introduce the concepts of industrial enterprise environmental risk, enterprise environmental management, and enterprise environmental regulation [Jingshuai, 2020; Yanxia, 2020].

The concept of environmental risks has been mentioned earlier. Among them are different types of pollution risks: air pollution risk, water pollution risk, solid waste pollution risk, noise pollution risk, radiation pollution risk, and others. Air pollution is the most serious in various energy companies, especially thermal power and steel. Water pollution is the most serious in such industries as paper manufacturing, metal smelting, and chemicals. Several other major aspects of pollution are related to various industrial enterprises. Among them, thermal power, iron and steel, paper manufacturing, metal smelting, and chemical industries have several pollution characteristics at the same time and cause greater serious damage to the environment and the highest environmental risk.

Scholars have also conducted a research taking into account the idea of “environmental risk management → changes in enterprise production factors → enterprise competitiveness”. They believe that environmental risk management has an impact on industrial economy and enterprise production not only at the macro, but also at the micro level.

The research on corporate environmental risk can be divided into several aspects. The research lines of Chinese scholars mostly follow those of European and American scholars. Some start with environmental risk management, others - with environmental risk assessment. Strategy management is also taken into account. In terms of environmental risk management, Chinese scholars mostly use various industries for their research. China’s industrial system is complete, and all major industries can find actual objects for research in China. According to the current pollution data in China, scholars mainly focus on thermal power, energy, chemical and heavy manufacturing. It is necessary to study the management of the enterprise itself, the environmental responsibility of the management of industrial parks, and the environmental management functions of the government. Most studies are based on China’s actual national conditions and can propose targeted solutions to practical problems.

This chapter considers several aspects that can partially solve or reduce the environmental risks of industrial enterprises, but the academic circles have not yet come to a conclusion how to eliminate environmental risks. Taking BRICS countries as an example, their attitudes towards environmental risks of industrial enterprises are not the same as well. In case of China there are currently two major schools in the academic community studying corporate environmental management and environmental risk assessment: one studies natural sciences and conducts general research on environmental risk assessment. The questions of technological development and utilization, environmental pollution and prevention technology, clean production technology, etc. are discussed at the engineering and technical level. The second school is interested in social sciences, management (including accounting and auditing), economics, and law. Corporate environmental pollution and protection issues, such as corporate environmental management, economic evaluation of external environmental damage, accounting confirmation and measurement of related environmental matters, environmental auditing, environmental legislation, etc. [Pigou, 1932; Coase, 1960; Man, 2005; Xu, Zhifang, 2012] are the scope of its research.

This article attempts to demonstrate the problem from the aspects of management innovation as well as the perspective of technological innovation in environmental risk management.

Enterprise’s response function to environmental risk management. Whether an enterprise conducts environmental management policy, the improvement of environmental management is the result of correlated internal and external factors. The environmental management decision of the enterprise can be described by the enterprise’s environmental management reaction function. According to the analysis it can be seen that the external factors affecting corporate environmental management can be divided into two categories: government risk management factors and market factors. Management decisions have a key impact. Therefore, the environmental management decision of an enterprise can be described as the following environmental reaction function (ERF):

ERF = f(External factors, internal factors).

The specific content of external and internal factors in the environmental response function is presented in table 2:

Different influencing factors in independent variables will have different effects on the company’s environmental management decisions: For some companies, environmental risk management is the main factor that affects the company’s environmental management decisions, while for other companies, it comes from the pressure of competitors, the environmental management of upstream and downstream enterprises. The environmental pressure of residents in the district are the main factors that affect the environmental management decisions of enterprises. Among the various influencing factors presented in Table 2, the government environmental risk management is the most basic one. Since the environment has the characteristics of public good, it is difficult to imagine that enterprises will consciously carry out environmental management policy without environmental risk management as the basic point. Therefore, the reaction function of enterprise environmental management can also be called the reaction function of enterprise to environmental risk management, and other influencing factors are derived on the basis of environmental risk management.

Environmental risk management is a necessary prerequisite for modern enterprises to achieve sustainable development. The goal of scientific environmental risk management is to achieve ecological and green sustainable development of the manufacturing industry, which is in line with the basic trend of current global development. In the actual management link, the staff needs to take into account the local common natural disasters and the data about environmental quality status, sort out environmental problems, estimate possible hazards, and formulate corresponding prevention plans [Dongning, Changhui, 2005].

Since environmental risk management is beneficial to the development of the industrial economy or it restricting the development of the industrial economy, the solution to this problem is the key to the government and various industrial departments formulating and implementing specific environmental risk management measures. To explain the practical effect of environmental risk management on China’s industrial economic growth, and to propose what environmental risk management policies must be adhered to in order to achieve a win-win situation for environmental protection and industrial economic growth are of key importance. The implementation of environmental risk management needs to be based on the status quo of regional development to ensure that environmental risk management is as small as possible to inhibit industrial economic growth. The research in this article still lacks empirical approach, which will be further proved by combining relevant models.