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I work for the same company, but based in US now. I left China without cancelling the residence permit. I need a business visa to travel there, but now I am told that I need to cancel the permit first. Can it be done locally in Chinese Consulate or through an agency in US? What would be the process for cancelling the permit?

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I have not faced this exactly, but I would expect the most normal way is that the company office in China should to go back to the local PSB where they got the permit.
There is a process for revoking it.

They may be reluctant because it may be more expensive and complex with you (or at least your passport) not there.
But I believe it's always that local issuing authority that is expected to do it.
You might push the company to be sure to file the permit cancellation request as showing you did nothing wrong - you mutually agreed to end early.

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