Content
EnvironmentalResponsibilities
Addressing Climate ChangesEnvironmental ManagementEnergy ManagementResource ConservationWaste ManagementChemical Safety
Appendix 1. Index of IndicatorsAppendix 2. List of Key PerformanceIndicatorsAppendix 3. Main ParticipatoryDomestic Associations andOrganizationsAppendix 4. Overview ofCerti?catesAppendix 5. Reader Feedback
Green Designs of Key ProductsFacilitation of Circular DevelopmentFacilitation of Collaborative Disposalof Urban Wastes
About This ReportTo StakeholdersAbout UsOur Sustainability ManagementTopic: Circular Economy ShapingNew Wonderful Lives
SocialResponsibilities
Responsibilityfor Governance
Technological InnovationsProduct Quality and SafetyCustomer ServicesSustainable Supply ChainFacilitation of Industry DevelopmentEquality, Inclusion and DiversityEmployees' Rights and InterestsEmployee Development and TrainingOccupational Health and SafetySocial Development and PublicWelfare
Operations of Three BoardsTransparent DisclosureRisk ManagementBusiness EthicsData SecurityIntellectual Property Protection
About This ReportThis is the second environmental, social, and governance (ESG) report issued by Kingfa Sci. & Tech. Co., Ltd. (hereinafterreferred to as "the Company", "we" or "us"), intended to integrate the concept of sustainable development intocorporate governance, and comprehensively present our ESG practice and related performance to our stakeholders.This Report covers the period from January 1, 2023, to December 31, 2023 ("reporting period"), punished onan annual basis. To increase the comparability and integrity of this Report, some content may be appropriatelyextended to previous and subsequent years.Time Frame of the Report
This Report, which focuses on the Company, covers all branches and subsidiaries of the Company (collectivelyreferred to as "the Group" together with the Company). The key environmental performance indicators are mainlyspeci?c to the Company, its branches, and its subsidiaries in China. The key social performance indicators aremainly about the Company, all its branches, and subsidiaries at home and abroad.
Coverage of the Report
All data and cases cited herein derive from the o?cial documents and statistical reports of the Company and itsa?liates. Unless otherwise speci?ed, all amounts hereunder shall be denominated in RMB.
Notes on Data of the Report
This Report may be accessed and downloaded on the official website of the Company (https://www.kingfa.com.
cn/) and the website of the Shanghai Stock Exchange (http://www.sse.com.cn/). This Report is provided for readersin Chinese, English, and Japanese. In case of any discrepancies among the three versions or con?icts resulting fromlanguages, the Chinese version shall prevail.
Access to This Report
GRI StandardsSustainability Accounting Standards Board (SASB) StandardsUN Sustainable Development Goals (SDGs)
Guidelines on Corporate Social Responsibility Reporting for Chinese Enterprisesbythe Chinese Academy of Social Sciences (CASS-ESG 5.0)
Guidelines No. 14 of Shanghai Stock Exchange for Self-Regulation of. ListedCompanies—Sustainability Report (Trial)
Reference Standards
Unless the context otherwise requires, the following words shall have the following meanings in this Report:
TermsCSRCmeansChina Securities Regulatory CommissionThe CompanymeansKingfa Sci. & Tech. Co., Ltd.Shanghai KingfameansShanghai Kingfa Sci.& Tech.Dvpt. Co., Ltd.Jiangsu KingfameansJiangsu Kingfa Sci.&Tech. Advanced Materials Co., Ltd.Tianjin KingfameansTianjin Kingfa Advanced Materials Co., Ltd.Guangdong KingfameansGuangdong Kingfa Sci.& Tech. Co., Ltd.Wuhan Kingfa meansWuhan Kingfa Sci.& Tech. Co., Ltd.Chengdu KingfameansChengdu Kingfa Sci.& Tech. Advanced Materials Co., Ltd.Kingfa (USA)meansKingfa Science & technology (USA), INC.Kingfa (Europe)meansKingfa Sci. & Tech. (Europe) GmbH.Kingfa (India)meansKingfa Science & Technology (India) LimitedKingfa BiomaterialsmeansZhuhai Kingfa Biomaterials Co., Ltd.Specialty Engineering PlasticsCompany
meansZhuhai Vanteque Specialty Engineering Plastics Co., Ltd.Kingfa Carbon Fiber/CarbonFiber Company
meansGuangzhou Kingfa Carbon Fiber Materials Development Co., Ltd.Ningbo KingfameansNingbo Kingfa Advanced Materials Co., Ltd.Liaoning KingfameansLiaoning Kingfa Sci.& Tech. Co., Ltd.National Industrial InnovationCenter
meansNational Industrial Innovation Center of Advanced Polymer Materials
Qingyuan MeijinmeansQingyuan Meijin Advanced Materials Sci. and Tech. Co., Ltd.Jiangsu Kingfa RecyclingmeansJiangsu Kingfa Recycling Co., LtdPPmeansPolypropylenePEmeansPolyethylenePCmeansPolycarbonateABSmeansAcrylonitrile butadiene styrenePSmeansPolystyrenePBATmeansPolybutylene adipate terephthalatePLAmeansPolylactic acidBDOmeans1,4-butanediolLCPmeansLiquid crystal polymerPAmeansPolyamidePBSmeansPolybutadiene-styrenePCRmeansPost-consumer recycledCOCmeansCyclic ole?n copolymerPPEmeansPolyphenylene etherChinese YuanmeansRMBReporting periodmeans2023
Environmental, Social and Governance Report
2023
About This Report
To Stakeholders
This is a momentous endeavor, spearheading the market with unwavering determination. Through theimplementation of "Overseas Forge Phase I," the company has accelerated its internationalization efforts,signi?cantly igniting global localization in market development and service capabilities. In the modi?ed materialssector, the company has enriched its product portfolio through iterative strategies in industry-speci?c innovativesolutions, effectively bolstering market share. In the unmodified materials sector, the company has unifiedthought and action, strengthened organizational capabilities, clari?ed product positioning, innovated marketingmodels, and greatly enhanced market competitiveness.
This exemplifies the innovative force steadfast in bearing national missions and unwavering dedication toadvancing China.The company demonstrates resolute determination towards fostering innovative capabilities,
continuously shaping novel momentum in aggregation. With the development of proprietary 5T-6T processingtechnology, the company has attracted industry elites, including doctoral experts, fostering the cultivation oforiginal capacities. By fortifying four national-level innovation platforms, the company has achieved numeroussuccesses in national project applications, garnering acclaim for its prowess in technological innovation.Leveraging the core advantage of 30 years of polymer material application expertise at KINGFA, the companyfearlessly explores novel pathways in petrochemical and modi?cation integration, steadfastly advancing on thejourney of technological innovation.
This epitomizes the refinement in management,anchoring the operational prowess of thecompany's rear echelon.Through bold reformsand vertical integration strategies, the companyhas significantly enhanced its supply chain securitycapabilities. The Human Resources Center hasinitiated overseas talent strategies and globalemployer branding efforts, attracting 40 doctoralexperts to solidify the internationalized talent pool ofhigh potential and caliber. Leveraging an internationaltraining system to cultivate a globally adept talentpipeline, the company deployed over 50 eliteprofessionals abroad in 2023 for strategic operations.A comprehensive assessment and implementationof talent leadership within the group, coupled withthe stable operation of the "271" cadre rotationmechanism, further propelled the elevation of high-quality talent management to new heights. Thesuccessful launch and operation of the group's firstdigital factory not only elevates KINGFA's intelligentmanufacturing capabilities but also signifies asteadfast stride into the realm of private-sectorintelligent manufacturing.
This exempli?es the sustainable development forcedriving towards a low-carbon, energy-efficient,and green circular economy. This exemplifies thesustainable development force driving towards a low-carbon, energy-e?cient, and green circular economy.The company embraces the mission of achievinggreen, low-carbon, and circular development,spearheading innovative practices acrossenvironmental protection and resource conservationdomains. By prioritizing green design for keyproducts, advancing circular development initiatives,intensifying resource integration, and promotingcoordinated disposal of urban waste, the companyconstructs a resource-circular industrial ecosystem,elevating resource utilization efficiency and shapinga harmonious and beautiful new way of life. These
actions underscore the ?rm's steadfast commitment tosustainable development, showcasing the Company'saccountability and accomplishment environmentalprotection and social responsibilities as a leader withinthe advance materials industry.The illustrious three-decade journey of KINGFAepitomizes the collective wisdom and perseveranceof countless individuals dedicated to the company'scause. Amid the currents of the new era, employees ofKINGFA have fervently pursued innovation and fearlesslyventured forth, together forging an unstoppable force.This has rendered the ethos of "loyalty, responsibility,diligence, and innovation" even more vibrant,while propelling the spirit of "new horizons, granddevelopment" to loftier heights, thereby outlining a granddevelopmental blueprint for the company. In 2024, it isimperative to narrate the compelling story of KINGFA'scultural heritage and uphold the entrepreneurial spiritingrained within its founders. The future trajectory ofthe company hinges signi?cantly on the cultivation anddissemination of its corporate culture. Efforts must bedirected towards unearthing the profound essence ofKINGFA's cultural heritage, constructing a distinctivecultural framework, and amplifying internationaloutreach initiatives to continuously elevate the brandimage and industry influence. By reinforcing a globallyunified ethos underpinned by KINGFA's cultural values,a formidable sense of employee cohesion is fostered,thereby sculpting an unparalleled competitive edgefor the company. Endeavors are earnestly dedicated toinfusing new vitality into China's private enterprises,endowing them with profound practical signi?cance on adeeper level.
In 2023, amid China's prosperity and stability, the diligent anddevoted efforts of the people nationwide crafted a remarkablenarrative of resilience, progress, and triumph over challenges thatcaptured global attention. In the same year, KINGFA, unwaveringin its belief that "confidence is more precious than gold,"steadfastly propelled itself forward with technological innovationat its core. Leveraging the company's global supply chain,technological research and development (R&D), and integratedmarketing platform, it delivered highly competitive advancedmaterial solutions to clients worldwide. As a consequence, marketshare enjoyed consistent expansion, while operating income sawa continual rise.
Former Chairman of KINGFA
Environmental, Social and Governance Report
2023
To Stakeholders
About Us
Founded in 1993 and headquartered in Guangzhou Science City, Kingfa Sci. & Tech.Co., Ltd. ("the Company, "we" or "us") "is an advanced materials enterprise focusingon the R&D, production, sales, and services of new high-performance materials, andproviding advanced material solutions for creating safer, more comfortable, andmore convenient life. Over 30 years of substantial development, the Company hasestablished 60 subsidiaries, and founded R&D and production bases abroad in SouthAsia, North America, Europe and so on. In 2004, the Company (Stock Code: 600143)was listed on the Main Board of Shanghai Stock Exchange.As the world's leading enterprise in new chemical materials, the Company remainscommitted to solving global environmental problems, promoting the continuousimprovement of living environment and achieving sustainable development. Ourproducts mainly rely on independent innovations and development, covering ninecategories, namely modi?ed plastics, environment-friendly high-performance recycledplastics, fully biodegradable plastics, special engineering plastics, carbon fiber andcomposite materials, light hydrocarbon and hydrogen energies, polypropylene resins,and healthcare polymers, which are widely used in the industries of automobiles,household appliances, electronic and electrical components, communicationelectronics, new infrastructure, new energies, modern agriculture, modern logistics,rail transit, aerospace, high-end equipment, healthcare and so on. We haveestablished strategic partnerships with numerous well-known enterprises aroundthe world. With satisfactory environment-friendliness and excellent performance, ourproducts are exported to more than 130 countries and regions around the world, andwe provide services for more than 1,000 world-renowned enterprises.
Company Pro?le
Relationship Diagram of Our Four Major Sectors and Main Products
SynthesisUpstream
Green petri?cation
Ningbo Kingfa (PPindustry chain)Liaoning Kingfa (ABSindustry chain)Light hydrocarbon andhydrogen energies
Modi?ed plasticsEnvironment-friendlyhigh-performancerecycled plasticsModi?ed plasticsModi?ed
HealthcarePolymeric healthprotective products
ProductsDownstream
Advancedmaterialssegment
Fully biodegradable plasticsSpecial engineering plasticsCarbon ?ber and compositesBio-based monomers and resin
Environmental, Social and Governance Report
2023
About Us
Michigan, USA
Wiesbaden, Germany
Gurugram, IndiaPune, IndiaChennai, Pondicherry, India
Johannesburg
Kuala Lumpur, Malaysia
Singapore
PingyangGuangzhou, China
TokyoBangkokDong Nai, VietnamHo Chi Minh CityMexicoLos AngelesSan Francisco
Changchun
XinxiangMianyang, SichuanChengdu, Sichuan
LuoyangChongqing
Nanning
Xiamen
Fuzhou
Wenzhou
Ningbo, ZhejiangChangsha
Nanchang
Weifang
QingdaoChangzhou
HangzhouWuhuHefeiSuzhouNanjing
Xuzhou, JiangsuWuhan, Hubei
Hong KongQingyuan, Guangdong
Zhuhai, GuangdongDanzhou, Hainan
Shenyang
Panjin, LiaoningTianjin Airport Economic Area
Qingpu, ShanghaiKunshan, Jiangsu
In line with China's "Belt and Road" initiative anddual circulation in domestic and overseas markets,the Company adheres to the strategic thinking of" strengthening the middle, consolidating bothends, being innovation-oriented, and achievingleap-forward development", and strives to build aworld-class R&D, marketing, manufacturing, andinformation platform to become a global leader inadvanced materials, providing support for nationalstrategic materials.
Development Strategy
Strategic Development Policy
Business developmentstrategy
The Company will continue to expand and empower the polymer business, which will be further developed in anall-round manner.Give full play to the supporting role and risk tolerance of the polymer business, to guide the healthy development ofupstream and downstream business sectors, and promote the synergy of the entire industrial chain.Strengthening themiddleConsolidatingboth endsFocus on high-qualitysustainable development
Coordinate and lead organizational optimization, technological innovation, marketing innovation, andoperational innovation.Being innovation-drivenCore objectives of businessdevelopment
With our focus on the grand output goal of one hundred billion, we will coordinate our four major businesssectors of modi?ed plastics, advanced materials, green petrochemicals, and healthcare for sustainable and high-quality development.Leapfrogdevelopment
Manufacturing and R&Dbases of the CompanyO?ces of the Company
Head o?ce of the Company
Global Layout
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About Us
1993
The Companywas established.
1997
GuangzhouTianhe GaotangProduction Basewas built.
2003The PostdoctoralScienti?c ResearchWorkstation wasbuilt.
2004
The Company was listed onthe Main Board of ShanghaiStock Exchange.Mianyang ChangxinAdvanced DevelopmentCo., Ltd. was established.The AcademicianWorkstation wasestablished.
2008Mianyang DongfangSpecial EngineeringPlastics Co., Ltd. wasacquired.
2009Zhuhai Wantong ChemicalCo., Ltd. was established.Tianjin Kingfa AdvancedMaterials Co., Ltd. wasestablished.
2010Jiangsu Kingfa Sci.&Tech. AdvancedMaterials Co., Ltd.was established.The sales of theCompany exceededRMB 10 billion.
2001
Shanghai Kingfawas established.
2013
Kingfa (India) wasacquiredGuangdong KingfaSci.& Tech. Co., Ltd.was established.
2014
Wuhan Kingfa Sci.&Tech. Co., Ltd. wasestablished.Kingfa GlobalInnovation TrainingDevelopment Centerwas established.
2015Kingfa Sci. & Tech. (USA)Co., Ltd. was established.Chengdu Kingfa Sci.&Tech. Advanced MaterialsCo., Ltd. was established.Kingfa Sci. & Tech.(Malaysia) Co., Ltd. wasestablished.
2019Ningbo HaiyueAdvanced MaterialsCo., Ltd. was acquiredand renamed "NingboKingfa AdvancedMaterials Co., Ltd.
2020
2021Liaoning BaolaiAdvanced Materials Co.,Ltd. was establishedZhuhai WantongChemical Co., Ltd. wasrenamed "Zhuhai KinfaBiomaterials Co., Ltd."
2022Liaoning Baolai AdvancedMaterials Co., Ltd. wasrenamed "Liaoning KingfaSci.& Tech. Co., Ltd."Kingfa (Japan) wasformally established.
2023Kingfa Sci. & Tech.(Vietnam) Co., Ltd.was established.
Development History
Hainan Kingfa Sci.&Tech. Co., Ltd. wasestablished.Kingfa Medical wasestablished.
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2023
1312
Honorary Certi?cates
Lingxuan Award Foresight
· Gold Medal
Public Service Demonstration Platformfor Small and Medium-sized Enterprises
in the Light Industry
Special, Re?ned, Uniqueand Novel "Little Giant"
Enterprise
O?cial Supplier of Personal
Protective Equipmentfor the 19th Asian Games
Hangzhou 2022Five-star Guangzhou
Charity Unit
Excellent PlasticRecycling Enterprise
Nationwide Case of Green,Low-Carbon, and CircularDevelopment in the Renewable
Resources IndustryRanked 37 among the Top100 Private Enterprises inGuangdong Province in 2023
Ranked 300 among China'sTop 500 Private Enterprises
in 2023
Ranked 21 among the Top100 Private Manufacturers inGuangdong Province in 2023
Ranked 205 amongPrivate Manufacturers inChina in 2023
Guangdong ProvincialIntellectual PropertyDemonstration Enterprise
Awarding by the Chairmanof the Recycled MaterialsBranch, CAPRO
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Environmental, Social and Governance Report2023
About Us
Our Sustainability Management
For the purpose of strategic development, the Company has built an ESG governance structure suitable for its ownbusiness attributes and management model, created an ESG governance structure at four levels (i.e. the Board ofDirectors, Strategy and Sustainability Committee, ESG working group, and ESG-related functional departments),and appointed special ESG functional personnel to manage its ESG matters. The ESG structure, which clearlyspeci?es the division of labor, rights, and responsibilities at all levels, manages the internal ESG work by a top-downapproach to promote the Company's sustainable development and enhance the Company's competitiveness.
ESG Governance Structure
In April 2023, the Company held the 19th meeting of the seventh Board ofDirectors, approved the "Proposal on Renaming the Strategy Committee ofthe Board of Directors" after deliberation, renamed the "Strategy Committee"as the "Strategy and Sustainability Committee", and added the ESG relateddecision-making functions the original responsibilities.In June 2023, the Company held the twentieth (extraordinary) meeting ofthe seventh Board of Directors, at which the 2022 Environmental, Social, andGovernance Report was approved after deliberation.
ESG Management System
The Company attaches importance to the stakeholders' participation in ESG, actively carries out communicationswith the stakeholders, understands the stakeholders' expectations and demands through di?erent communicationchannels, and practically performs responsibilities for joint development, mutual bene?t, and win-win.
Stakeholder Communication
Governmentand regulatoryauthorities
?Responses to national strategies?Compliance operation?Risk Management?Business Ethics
?Government inspections?Compliance inspections?Regular meetings and exchanges?Participation in government cooperation,exchanges and seminars
Shareholders/investors
?Stable return on investment?Transparent information disclosure?Compliance operation?Risk Management?Intellectual Property Protection?Technological innovation
?Regular and temporary information disclosure?Operation by the Board of Directors, the Boardof Supervisors and the general meetings ofshareholders?Performance brie?ng?Investor Hotline?Company researchCustomers
?Product quality and safety?Customer services?Responsible business and marketing?Technological innovation?Data security
?Customer exchange and cooperation?Customer satisfaction survey?Daily communication with customers?Con?dentiality of customer information
Employees
?Employment, employee rights and interests?Equality, inclusion and diversity?Employee development and training?Occupational health and safety
?Employee training?Periodic working meetings?Employee symposiums and democraticcommunications?Employee engagement survey?Employee ActivitiesSuppliers andpartners
?Sustainable supply chain?Supplier empowerment?Transparent procurement
?Supplier communications?Supplier conferences
Communitiesand industries
?Green products and designs?Industry exchanges?Facilitation of the Industry Development?Public welfare donations?Addressing climate change?Biodiversity and ecological protection
?Industry conferences
?Industry-academia collaboration
?Public bene?t activities?Rural revitalization
?Environmental protection
Media
?Information disclosure and dissemination
?Responsible business and marketing
?Regular and temporary information disclosure
?Marketing information review
Board ofDirectors
ESG-relatedfunctionaldepartments
Key resolutions
Strategy andSustainabilityCommittee
ESG working
group
As the top team responsible for ESG, the Board of Directors assumes full responsibilitiesfor the Company's ESG strategies, management and external disclosure.Top responsible team
Incorporate ESG work into strategic planning; study the Company's medium and long-term development strategic plans and make suggestions; carry out research on theCompany's sustainable development, environmental, social and corporate governance(ESG) as well as other related matters; and make relevant suggestions and decisions.
Decision-making
As its daily office in the ESG field, the ESG working group is composed of theCompany's senior management and heads and executors of the ESG-related functionaldepartments. The ESG working group supervises and manages the ESG-related workof key functional departments, implements ESG strategies and speci?c measures, andreports to the Strategy and Sustainability Committee on a regular basis.
Management
All functional departments and subsidiaries related to the Company's important ESGissues actively perform specific ESG-related work within the scope of their dutiesduring their daily operations, and promote the fulfillment of all ESG-related keyperformance indicators and goals under the guidance of the ESG working group.
Execution
StakeholdersFocuses and expectationsCommunication channels
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Environmental, Social and Governance Report
Based on our sustainable development strategies and in combination with our stakeholders' needs andexpectations in normalized communications, we have identified 25 material ESG issues with reference torelevant domestic and foreign standards, macroeconomic policies and industry trends, etc. During the reportingperiod, we evaluated material issues, and carried out our work based on the sequence of "issue identi?cation- stakeholder survey - generation of a materiality matrix", to understand the extent to which the stakeholdersattach importance to each issue, and to clarify the responsibilities at the execution level, to continuously improveour ESG management.
Refer to our development orientation and ESG strategyIdentify 25 ESG issues according to domestic and foreign standards as well asindustry development trends.
Conduct materiality research on material issues for our internal andexternal stakeholders through interviews, questionnaire distribution, etc.Prioritize the issues by materiality based on the survey results and di?erentinternal and external dimensions of the Company.
After prioritizing the issues by materiality, draw a materiality matrix to showtheir importance inside and outside the Company.The ESG working group analyzes and summarizes the issues according toour situation, and generates a ?nal materiality matrix.
Issue identi?cation
Stakeholder survey
Generation of a materiality matrix
Work Procedure for Material Issues
Materiality Matrix Identi?cation of Material Issues
Circular economyChemical safetyEnergy managementGreen products and designsWaste managementAddressing climate changesBiodiversity and ecologicalprotectionConservation of waterresources
Materiality for our development
Materiality for our stakeholders
Substantially
material
Substantially
material
Material
Material
E1
E1
E3
E3
E5
E5
E7
E7
E2
E2
E4
E4
E6
E6
E8
E8
Environmental issues
G1
G1
G3
G3
G5
G5
G6
G2
G2
G4
G4
G6
Intellectual propertyprotectionRisk managementBusiness ethicsData securityTransparentdisclosure
Governance issuesS1
S1
S3
S3
S5
S5
S7
S7
S2
S2
S9
S9
S11
S11
S10
S10
S4
S4
S6
S6
S8
S8
Technological innovationsProduct quality and safetyCustomer servicesSustainable supply chainOccupational health andsafetyResponsible business andmarketing
Social issues
Employee developmentand trainingEmployment, employeerights and interestsFacilitation of theindustry developmentSocial development andpublic welfareEquality, inclusion anddiversity
Operation by the Board of Directors, the Board of Supervisors, and the general shareholders' meetings
1918
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Management
Environmental, Social and Governance Report
LegalAuditDepart-ment
Quality
Standar-dization
O?ce
Inform-
ationCenter
IP O?ce
KingfaEnviro-nmental
KingfaBiomat-
erialsPetrifactionsegmentBases
Othersubsidiariesand basesE1: Circular economyE2: Chemical safetyE3: Energy managementE4: Green products anddesignsE5: Waste managementE6: Addressing climatechangesE7: Biodiversity andecological protectionE8: Conservation of waterresourcesS1: TechnologicalinnovationsS2: Product quality andsafetyS3: Customer servicesS4: Sustainable supplychainS5: Occupational healthand safetyS6: Responsible businessand marketingS7: Employeedevelopment and trainingS8: Employment,employee rights andinterestsS9: Facilitation of theindustry developmentS10: Social developmentand public welfareS11: Equality, inclusionand diversityG1: Intellectual propertyprotectionG2: Risk managementG3: Business ethicsG4: Data securityG5: Transparent disclosureG6: Operation by the Boardof Directors, the Boardof Supervisors, and thegeneral shareholders'meetings
Mark-etingCenter
Techn-ologyCenterSupply ChainCentre/PurchasingDepartment
StrategicDevelop-mentDepart-ment
O?ces
ProcessEquip-mentDepart-ment
ProjectDepart-
ment
HR Depart-ment
SecuritiesDepartmentE1: Circular economyE2: Chemical safetyE3: Energy managementE4: Green products anddesignsE5: Waste managementE6: Addressing climatechangesE7: Biodiversity andecological protectionE8: Conservation of waterresourcesS1: TechnologicalinnovationsS2: Product quality andsafetyS3: Customer servicesS4: Sustainable supply chainS5: Occupational health andsafetyS6: Responsible businessand marketingS7: Employee developmentand trainingS8: Employment, employeerights and interestsS9: Facilitation of theindustry developmentS10: Social development andpublic welfareS11: Equality, inclusion anddiversityG1: Intellectual propertyprotectionG2: Risk managementG3: Business ethicsG4: Data securityG5: Transparent disclosureG6: Operation by the Boardof Directors, the Board ofSupervisors, and the generalshareholders' meetings
Units Responsible for Material IssuesUnits responsible formaterial issues
Units responsible formaterial issues
indicates "responsible for"or "heavily involved in"
indicates "responsible for speci?c partsthereof"
indicates "participation" or "support"
E
Environmental (E)Environmental (E)
Social (S)Social (S)
Governance (G)Governance (G)
E
SS
GG
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Environmental, Social and Governance Report
Contributions to UN Sustainable Development Goals
We actively participate in exchanges, exhibitions and other activities related to materials and sustainabledevelopment, and realize the coordinated development of the industry through intuitive and high-qualityexchanges.The Company attaches great importance to improving the suppliers' capabilities and is committed tocoordinated development with suppliers. We maintain close communications and exchanges with oursuppliers by holding supplier conferences, conducting supplier training, and implementing suppliersupport projects to achieve mutual bene?ts and win-win.
SDG 17: Partnerships for goal achievementThe Company actively participates in the national rural revitalization work, supports and makes donations to publicutilities such as health care, ?re?ghting, and education in various forms while serving and giving back to the public.
SDG 1: No poverty
The Company improves its governance capacity and risk management to ensure its long-term development and maximization of its interests. We strictly implement internalcontrol and risk management to ensure our steady development.
SDG 16: Peace, justice, and strong institutions
The Company achieves the goal of carbon neutrality by reducing carbonemissions, improving energy efficiency, and promoting clean energies.We optimize the energy structure and make our products greener byintroducing more environmentally friendly energy-saving productionprocesses and technologies, in an attempt to reduce our carbonemissions and make contributions to the global response to climatechange.
SDG 13: Climate action
The Company consistently guarantees product safety, strictly controlsthe use of hazardous substances in products, and establishes a safetyassessment mechanism for hazardous substances to ensure that theproduction process complies with regulatory requirements and deliversproducts and services up to high standards.
SDG 12: Responsible consumption and production
We promote collaborative disposal of urban wastes, propose an integratedcomprehensive overall solution of "making the best use of plastics", supplyenvironmentally friendly high-performance recycled plastics, and accelerate greenlowcarbon transformation of the entire plastic industry chain.
SDG 11: Sustainable cities and communities
The Company upholds equality and inclusion, and resolutely opposes any form of discrimination. Weare committed to building a diversified and harmonious workplace environment to ensure that allemployees are respected and accepted.
SDG 10: Reduced inequalities
The Company has continuously developed the world's leading technology R&D platform, created anR&D system known as "13551", improved its independent R&D capabilities, and developed new greenrenewable products to lead the industry's technological upgrading.
SDG 9: Industry, innovation, and infrastructure
We enhance our employees' safety awareness and create a safe healthy working environment.SDG 3: Good health and well-being
The Company actively develops and adheres to diverse and inclusive cultural
concepts, pays special attention to the protection and improvement of
the female employees' rights and interests, emphasizes equality between
men and women, ensures that the female employees' rights and interests
are fully protected at work, and prevent any forms of infringement and
discrimination.
SDG 5: Gender equality
We continuously strengthen our management and conservation of water
resources, which not only helps us reduce our operating costs and improve
our economic benefits, but also makes us less reliant upon natural water
resources, eases our pressure on water resources, and maintains ecological
balance.
SDG 6: Clean water and sanitation
The Company annually sets the overall energy efficiency target, requires all its plants
to set corresponding targets according to their production and operation situation,
continuously tracks the achievement of the targets and increases the energy utilization
e?ciency during our production and operations.
The Company regularly carries out energy-saving renovation of workshops, and
significantly reduces energy consumption and greenhouse gas emissions through
coordinated optimization of management and technologies.
SDG 7: A?ordable and clean energy
We adopt a salary structure that integrates base salary and variable pay, with a view to establishing a salary
incentive system that not only re?ects internal fairness but also demonstrates external competitiveness for
our employees.
We award shares to our core employees and internally implement a target responsibility system for our posts,
which stimulates our employees' autonomy and creativity, keeps their goals in line with our goals, and allows
our employees to make and share development achievements with us.
SDG 8: Decent work and economic growth
The Company is committed to improving the employees' skills and knowledge
through continuous internal and external training, to provide tailor-made training
opportunities for the employees at di?erent stages to achieve self-enhancement.
Adhering to the concept of rejuvenating the country through education, the
Company supports the development of education through donation activities. In
combination with our businesses, we output knowledge through popular science
activities to guide minors to foster their awareness of science.
SDG 4: High-quality education
Goals
SustainableDevelopment
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Environmental, Social and Governance Report
The Company vigorously promotes ESG work. While developing our principal businesses, we advocate theconcept of recycling and renewal, focus on recycling plastic wastes, reduce their pollution, gain recognition andhonor from the outside, and encourage ourselves to advance bravely.
Bloomberg Green
China Development and Reform News
Organizing Committee of the Social
Responsibility ConferenceChina Association for Public CompaniesExcellent ESG Case among Listed
Companies in 2023
"Annual Concerned Enterprise"
on the ESG50 List
Sustainability Honors
Class 1 Work on Excellent Practice Case of"Governance of Plastic Pollution" in 2023
China National ResourcesRecycling AssociationIndustry LeaderAona Award - 2023 Low-Carbon
Business Pioneer
APP China Environment NewsChina Resource Recycling Association
Excellent Case of "Beat Plastic Pollution"Enterprises with standardization outcomesChina Sustainability TribuneGoldenKey. SDG Forerunner
EcoVadis
Shanghai Kingfa -Silver Medal
Kingfa (India) -Silver Medal
Kingfa (Europe) -Silver Medal
Jiangsu Kingfa -
Bronze Medal
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ManagementEnvironmental, Social and Governance Report
Green Designs of Key Products
Intensively implementing the strategic development plan for circular economy in the "14th Five-year Plan",we actively assume social responsibilities. As a leading enterprise in the advanced materials industry, theCompany has maintained the original aspiration for creating a wonderful world and remained committedto coordinating "the plastics, the mankind, and the earth". By promoting green designs of key products,promoting circular development, strengthening comprehensive utilization of resources, and promotingcoordinated disposal of urban wastes, the Company has established an industrial resource recycling system,to increase resource utilization e?ciency and create a beautiful new life.
The Company actively responds to customer requirements for environment-friendliness according to thenational strategic plan for carbon peaking and neutrality. We constantly make innovations in our productdesigns, in an attempt to promote the green designs of key products and facilitate the sustainable developmentof products through innovative technical solutions and selection of environmentally friendly raw materials.
Topic
Circular Economy Shaping NewWonderful Lives
Low-carbon improvement of modi?ed nylonengineering plastics
By 2030, the Company will produce
million
In 2023, the Company produced
0.2192
million
million
tons of green plasticsrecycle
tons of waste plastics
0.218
million
recycledtons of green plasticstons of waste plastics
million tons of recycled plastics.
and manufacture
0.2802
million tons of recycled plastics.
and manufactured
Strategic goalsProgress in 2023
Lightweight technology:
Promote the iterative upgradingof technologies, including steelreplacement steel by plastics,high performance, low density,microcellular foaming and thin wall.Long useful life: Reduce carbonemissions by prolonging the usefullife of materials and reducingmaterial consumption.Carbon reduction in theproduction process: Improve
the production stability andproduct performance; increasethe production capacity and rateof conforming products; andupgrade equipment for low energyconsumption.
Low-carbon technologies
Bio-based materialsPCR materialsPIR materialsLow-carbon raw materialsLow-carbon nylon
The Company has developed a variety of special engineering plastics, including special polyamide - Vicnyl? HTPA (which may be appliedin LED re?ection brackets, electronic connectors, automotive wiring harness sheaths, water puri?ers\water ?lters). We have successfullydeveloped low-carbon products, among which Vicnyl? PA10T contains a biochar of 40-60 wt%, rated two stars in terms of the bio-basedcerti?cation. The carbon emissions of the new-generation bio-based polyamide material - Vicnyl? PA5T/X are 20% lower than those of PA6Tof the same speci?cation. Besides, we actively perform low-carbon deployment, develop bio-based LCPs, bio-based polyamides with longcarbon chains, bio-based polyamide elastomers, etc., and promote green product designs in sub?elds.The Company actively explores bioplastics
and constantly develops new products. We have developed a variety of new products, includingPBS, PBAT, and PLA, which have satisfied the multi-faceted market demand, contributed to a substantial increase in our market share,and consolidated our leading position in the industry. The company also conducts forward-looking research, plans technical research
Biodegradable Materials of the Company
and industrialized construction onbio-based monomers and materials,and promotes the extension of theindustrial chain.Our active R&D of bio-based materialsmay avoid or reduce the use of fossilresources, thereby reducing ourdependence on fossil resources andcarbon emissions. Compared withfossil-based BDO, bio-based BDOreduces the carbon footprint bymore than 40%, and will be put intoproduction in 2024. Compared withthe fossil-based PBT, the bio-basedPBT demonstrates a decrease of about25% in the carbon footprint, and will belaunched in 2024.
PCR nitrogen-based ?ame-retardant nylon, PCR reinforcednylon, PRC red phosphorus-based ?ame-retardant nylon,PCR brominated ?ame-retardant nylon, reinforcedbio-based high-temperaturenylon, organic phosphorus?ame-retardant bio-basedhigh-temperature nylon, andbrominated ?ame-retardantbio-based high-temperaturenylon, etc.
Shopping in commercial supermarketsE-commerceexpress delivery
Agriculturalmulch ?lms
Disposabletableware
2726
Topic2023
Environmental, Social and Governance Report
In terms of recycled plastics certification, the Company has obtained T?V Rheinland's world's first certificatefor Ocean Bound Plastic (OBP) Recycled Content, UL2809 Certificate for Recycled Plastic Content, and GlobalRecycled Standard (GRS) Certification, etc. As of the end of the reporting period, we had been issued 60certi?cates for Ocean Bound Plastic (OBP) Recycled Content, 102 certi?cates for PCR content, 8 certi?cates forchemically recycled plastics, 1 certi?cate for pre-consumer recycled plastic content, and 2 certi?cates for bio-based recycled plastic content. The Company has provided products and services for thousands of internationallyrenowned enterprises in more than 130 countries and regions around the world. Our environmentally friendlyhigh-performance recycled plastic products are widely used in many industries.
Biodegradable products of Kingfa Medical
Biodegradation rate: The degradation rate is 94% over 90 days, and
the biodegradation rate is up to 98% over 120 days.
Biodegradation rate: The degradation rate is 94% over 90 days, and thebiodegradation rate is up to 98% over 120 days.
Biodegradation rate: The degradation rate is 86.3% over 90 days,and the biodegradation rate is up to 90.7% over 120 days.
Biodegradation rate: The degradation rate is 94% over 90 days,and the biodegradation rate is up to 98% over 120 days.
Biodegradation rate: The degradation rate is 94% over 90 days, and the
biodegradation rate is up to 98% over 120 days.
Biodegradation rate: The biodegradation rate is up to 97.5% over
180 days.
Biodegradation rate: The degradation rate is 94% over 90 days, and thebiodegradation rate is up to 98% over 120 days.
Biodegradation rate: The degradation rate of compost is 26.09%over 225 days.
Biodegradation rate: The degradation rate is 96% over 90 days,and the biodegradation rate is up to 98% over 120 days.
Product materia: Polybutylene adipate terephthalate + polylactic acidProduct material: Polylactic acid
Product material: Polybutylene adipate terephthalate + polylactic acidProduct material: Polylactic acid
Product material: Polybutylene adipate terephthalate + polylactic acidProduct material: Polybutylene adipate terephthalate + polylactic acid
Product material: Polybutylene adipate terephthalate + polylactic acidProduct material: Nitrile rubber
Product material: Polylactic acid
Isolation gownShoe covers
Protective clothing Caps
Shoe coversMasks
CapsGloves
Isolation gown
2928
2023
TopicEnvironmental, Social and Governance Report
Promotion of Circular Development
Promoting circular development is an important path for building a sustainable development model, realizinga green economy, and facilitating efficient utilization of resources. We realize industrial upgrading andtransformation, reduce our reliance on natural resources, decrease environmental pollution, and promote green,low-carbon, and circular development of the social economy by promoting resource recycling and research onrecycling technologies.
CaseRecycling and reuse of internal materialsKingfa Carbon Fiber continuously optimizes the use of materials in the internal transfer process, increasesthe value of recycling materials, promotes the reuse of resources, and cuts production costs.
Previously, the papertubes could not bereused once damaged,but the alternative PPtubes demonstrate farhigher strength. Withoutbeing a?ected by theenvironment, they may berecycled more than 5 times.
Used for collecting wastetubes and yarn in process,they are transported backto the production lines forrecycling after use by thewaste disposal companies.
Recycling of Carbon Fiber Materials by the Company
CaseCooperative promotion of recyclable pallets
The Company focuses on the recycling of resources, actively promotes theuse of recyclable pallets, eliminates disposable wooden pallets, and reduceswaste production while cutting costs, in an attempt to create an efficient,expedient, and environmentally friendly supply chain system with customers,to respond to the national environmental protection policies and achievesustainable development. As of the end of the reporting period, the companyhad cumulatively cooperated with more than ten customers on recyclablepallets. Each recyclable pallet was used 9.69 times on average, and the use ofwooden pallets was reduced by 19,385.
Wooden Pallets VS. Recyclable
Pallets
Replacing paper tubes with
prepreg PP tubes
Recycling of waste ton bags
The platform boardsfor internal turnoverand carrying are mainlyreplaced by iron ones, forrepeated use.
Turnover of platform boards
Signi?cance of Recyclable PalletsImprove the overall quality of pallets, andreduce the probability of damages, brokenpackages, and cargo damages
Recycle resources to support realization ofcarbon peak and carbon neutralityImprove the appearance and brand image ofproducts
Replace the disposable pallets, which aremore environment-friendly and economical.Enhance weather resistance, impact resistanceand carrying capacity
Optimize the industrial supply chain toachieve upstream and downstream costreduction and e?ciency increase
The Company loads the goods according to the shipment plan, count the number of recyclable palletsshipped with the products according to the palletization quantity and ensure that the goods are deliveredto the customers with pallets up to pertinent quality standards.
When receiving the goods,the customer shall con?rmthe quantity and the palletdamages on site, and report thenonconformity with the qualitystandards to the Company.After using the products up, thecustomer shall stack the emptypallets in order before theCompany's logistics vehiclesarrive on site for recycling asscheduled.
The Company's logisticsservice provider regularlyrecycles pallets from thecustomer's premise, andcon?rms the quantity onsite. The pallets recycledwill be used for the nextshipment.
Operation
Mode ofRecyclable
Pallets
TheCompanyrecycles thepallets througha logistics serviceprovider
The Companyships the goods
The customerreceives the goods
3130
2023
TopicEnvironmental, Social and Governance Report
Promotion of Collaborative Disposal ofUrban WastesWith the advent of the era of low-carbon circular economy, the development of recycled plastics
has become inevitable. To solvethe problem of plastic pollution and support the achievement of the goal of carbon neutrality, the Company has relied on the statekey laboratories for e?cient development and high-quality utilization of waste plastic resources, the State Engineering Laboratoryfor Plastic Modi?cation and Processing, the National Industrial Innovation Center of Advanced Polymer Material, its own NationalCorporate Technology Center, the Postdoctoral Research Station, and the Sustainable Development Technology Research Institute,etc. Since 2004, we have gradually established a comprehensive, complete, and closed technical recurrent recycling system forthe reduction of carbon emissions, covering the whole process of waste plastics from intelligent identi?cation of waste plastics,automatic sorting, green cleaning, waste classi?cation by quality and useful life, cascade regeneration, and high-quality utilization.We also put forward integrated and comprehensive overall solutions for "utilizing the plastics to the greatest extent", to supplyenvironment-friendly high-quality recycled plastics to the industries of packages, automobiles, IT electronics, electric appliances,furnishings, electrical appliances, electric tools, buildings, energies, express delivery and so on, and accelerate the transformationof the entire plastic industrial train into a green low-carbon recycling chain.
The Company's Economical Plan for Plastic Recycling - IntegratedOverall Solutions for "Use of Plastics to the Greatest Extent"
CaseResearch on a national key recycling program
In 2023, the national key research and development program titled "Green Recycling and High-quality UtilizationTechnology and Demonstration of Waste Plastic Packages Based on Structure-activity Relationships" that theCompany participated in was completed and is undergoing acceptance inspection. In this program, the Companyundertook research on the "development and application of smart identification/selection equipment and greencleaning process for mixed waste plastic packages", where the Company revealed the structure-activity relationshipsof the mixed waste plastics under the coupling e?ects of multiple external ?elds, made breakthroughs in the structure-oriented machine vision-based identification and precise sorting technologies, increased the identification andselection rate of homogeneous materials, shortened the post-disposal procedures, and reduced the recycling load.We studied the models of interactions between mixed waste plastics and pollutants, the separation model, and speedunder the effects of external forces and thermal energy. We solved the problem that it was difficult to thoroughlyremove the pollutants from the waste plastics and the e?ciency was low in the pre-proposal process, realizing rapid,e?cient, and green cleaning of mixed plastics. In this project, applications have been ?led for 59 Chinese inventionpatents, including 37 granted patents, and 8 Chinese utility models; 14 standards or specifications have beenpublished, including 4 Chinese national standards and 10 group standards; applications have been ?led for 2 softwarecopyrights and 61 academic papers have been published.
Equipment investmentswere reduced by 67%Metal content wasdecreased to 0.02%Separation purity wasincreased to 98%Separation e?ciency wasincreased by over 3 foldsEnergy consumption perunit was cut by 33%Water consumption perunit dropped by 20%Equipment costs were cutby 80%
RecycledhomogeneousmaterialsRecycledheterogeneousmaterialsRecycled 3D printingwiresRecycled pulpPET intermediatesPolyurethaneadhesivesLogistics boxes
CreativeproductsInnovationachievements
Fossil rawmaterialsBiological rawmaterials
Production of fossil-based plasticsProduction of bio-based plastics
Manufacturing of ?nished products
Consumption
Repeated use
Land?llIncinerationDischarge into environment
Repeated use
Modi?ed pelletizing
Hazard-free treatmentOdor and impurityremoval
Cleaning and crushing
Sorting
Recycling
Sorting
Recycled plastics
Bioplastics
Two major focuses
3332
2023
TopicEnvironmental, Social and Governance Report
Starting from recycling, pre-treatment, ?ne recycling, high-quality utilization, and other links, the Company hassolved the pain points and difficulties on technologies, equipment, and environment-friendly actions in therecycled plastics industry one by one, providing theoretical and technical support for the e?cient utilization ofwaste plastics.
Upstream Recycling Sources and Downstream Application Scenarios of Environment-friendly High-performance Recycled Plastics
Diverse sources of recycling
Serve more than 1,000 world-renowned enterprisesApplied in ten major industries
Diverse application scenariosThe Company's environment-friendly recycled
plastics factory
Electrical appliancesElectric toolsBuildingsElectric appliancesFurnishingsPackagesAutomobilesEnergiesExpress deliveryL
i
f
e
Industries
Ocean
A
g
r
i
c
u
l
t
u
r
e
500+ high-quality suppliers60+ resource recycling outlets
As of the end of the reporting period, the Companyhad domestically built two production bases ofrecycled plastics, including Qingyuan Base andPizhou Base, which are situated in South and NorthChina respectively. We have built factories with atotal area of 0.3 million square meters, 6 productionworkshops of high-performance recycled modi?edplastics, more than 60 highly standard productionlines, and 6 production workshops for pretreatmentof waste plastics, with a high-quality treatmentcapacity of 0.12 million tons of various wasteplastics and an annual production capacity of morethan 0.3 million tons of recycled plastics.
During the reporting period, we cumulativelyparticipated in recycling 0.1 million tons of wasteplastics such as PP, HDPE, PS, ABS, and PC fromdomestic sources, and 0.098 million tons of otherwaste plastics from industrial sources (includingdismantling and factory wastes), including ABS,PS, PP, PA6, PA66 and PBT. We got involved inrecycling 0.01 million tons of marine wasteplastics like PA6, PP and PE, and 0.01 million tonsof PE from agricultural sources in total.
Our innovative environmentally friendly high-performance plastic recycling and renewal technology for wasteplastics is not only helpful for solving white pollution but also significantly reduces energy consumptionand carbon emissions in the process of production compared with the use of raw materials. We have madecontributions to addressing climate change, protecting the ecological environment, and facilitating biodiversity.
循环利用技术体系
We have created a network for recycling plasticwaste for multiple scenarios and channels ofindustry, architecture, life, and ocean, etc.Having possessed a refined recycling model,we have developed more than 500 high-quality suppliers of recycled plastics for eachsubdivided recycling channel, and builtmore than 60 resource recycling outlets, tocontinuously improve our front-end recyclingcapabilities.We cooperate with domestic large-scaledismantling and recycling plants for directdisposal of the waste raw materials in theplants, thus greatly shortening the recyclingchain and reducing recycling costs.
We have designed combination screwsfor extruders and melt filtration methodsto improve the appearance grade of ourrecycled plastic particles.The odor intensity is reduced by combiningnegative pressure, water injection, steaming,and infrared heating.
We analyze physical properties, appearances,structures, impurities and aging propertiesof recycled plastics, and improve the defectsof waste materials. By studying the impactsof formulas, antioxidants and impurities,we improve the mechanical and agingproperties of waste plastics combined withthe extrusion blending technology, to obtainhigh-quality modified plastics, which maycompletely or partially replace advancedmaterials in terms of properties.
RecyclingPre-treatment
With persistent efforts for our R&D of core
technologies and equipment, we have made
relatively substantial progress in the ?elds of
intelligent identification, automatic sorting,
and removal of chemical impurities. We
have increased our recycling efficiency and
reduced resource waste.
For different types of waste plastics, we
have designed characteristic pre-treatment
equipment and lines. We have developed
speci?c environment-friendly cleaning agents
and solvents by pollutant types. We have
constantly optimized our technologies for
efficient cleaning and secondary pollution
control to mitigate process pollution.
Intensive recyclingHigh-quality utilization
Recycling Technology System
IT electronics
3534
2023
TopicEnvironmental, Social and Governance Report
SDGs：
EnvironmentalResponsibilities
Number ofnational greenfactories
Recycling ratio ofwaste gas
26.26
%Recycling ratio ofwastewater
8.54
%Recovery rate ofwastes
33.89
%
Investments inenvironmentalprotection
66.8970
RMBmillion
Produced
0.2192
million tons ofgreen plasticsRecycled
0.218
million tons ofwaste plasticsManufactured
0.2802
million tonsof recycledplastics
Compared with 2022, thegreenhouse gas emissionsper unit of products in 2030will be reduced by at least
30% on a year-on-year basis.
In 2030, green plastics(including fullybiodegradable plasticsand bio-based materials)of 1 million tons andenvironment-friendly high-performance recycledplastics of 1 million tonswill be produced, while thewaste plastics of 1 million
tons will be recycled.
The Company will realizecomplete carbon neutralityby 2060.
Addressing climate change
Responding to the call for the dual carbon goal
The Company achieves the goal of carbon neutrality by reducing carbon emissions, improving energy e?ciency,and promoting clean energies. We optimize the energy structure and make our products greener by introducingmore environmentally friendly energy-saving production processes and technologies, in an attempt to reduce ourcarbon emissions and make contributions to the global response to climate change.
In response to the national goal of "2030 carbon peaking and 2060 carbon neutrality", the Company has initiatedthe "green, low-carbon, and circular" action. From 2021, the Company and its stakeholders worked together toestablish a "carbon" management system, inspect corporate carbon footprints according to related standards,continuously reduce carbon emissions, and regularly disclose the progress of carbon neutrality.The Company has established a dual-carbon strategy with Kingfa characteristics, planned to reduce plasticpollution caused by its business operations while reducing carbon emissions, and helped the industrial chainreduce its overall emissions by 2060. For this purpose, we have drafted a detailed dual-carbon action plan andlow-carbon product strategy and accelerated our R&D of more low-carbon and environment-friendly products.Carbon Goals of the Company
Dual-carbon Action Plan
Identify, inspect, monitor, and manage emissions; establish a control system andcontinuously optimize it; and gradually expand the application scope of green energies.
Build green parks and green factories; promote relevant parties to practice greenproduction, living and o?ce methods.
Establish a green procurement mechanism and a carbon emission management systemfor the supply chain to promote the realization of the emission targets of the supply chain.
Select key products and check the carbon footprint of products according torelevant standards; continuously improve and re?ne emission reduction work; andregularly make them public.Construct R&D, design, production, supply, and service systems for green low-carbonreproduction, continuously improve e?ciency and achieve the carbon emission reductiontarget per unit product.
Construct a green plastic recycling system; promote and continuously improve it.
Create a full value chain to provide low-carbon solutions, accelerate the overall emissionreduction of the industry, and cooperate with the entire industry chain to verify the carbonfootprint of the product life cycle and continuously reduce emissions.
3938
2023
EnvironmentalResponsibilities
Environmental, Social and Governance Report
As verified by T?V Rheinland, an independent third-party organization, the Company's greenhouse gasinventories in 2023 included the modified plastics of the head office and within the territory of China, as wellas 11 sites of recycled plastics. During the reporting period, the total greenhouse gas emissions (Types I + II) ofthese eleven sites were 281,809.24 tons of carbon dioxide equivalents, including 5,250.49 tons of carbon dioxideequivalents from Type I direct emission, and 276,558.75 tons of carbon dioxide equivalents from Type II indirectenergy emissions.Comparison of Greenhouse Gas Emissions in 2023and 2022 in the Domestic Sector of Modi?ed Plastics
Evaluation on Carbon Footprint of Low-carbon Products (Excerpt)
SectorsItem20222023
Year-on-year carbonemissions in 2023 and 2022Modi?ed plastics
Type I emissions (t CO
)3,813.255,250.49/Type II emissions (t CO
)305,625.07276,558.75/Carbon emissions perunit product (t CO
/ton)
0.180.13-28.65%Includingenvironment-friendly high-performancerecycled plastics
Type I emissions (t CO
)374.51 245.60 /Type II emissions (t CO
)26,982.33 27,030.05 /Carbon emissions perunit product (t CO
/ton)
0.15 0.10 -28.92%
| Notes: | (1) The sites for statistical analysis of the data in the above table remained the same in 2023 and 2022, including 11 sites of the head o?ce, modi?ed and recycled plastics within the territory of China. Types I and II emission data have been veri?ed by a third-party organization. In 2023, the petrifaction segment was just put into production and the designed production capacity was not fully reached. Related data is intended to be disclosed in the 2024 ESG report.(2) Type I: direct greenhouse gas emissions, including consumption of ?xed equipment necessary for production, fuel consumption of means of transport, production processes of raw and auxiliary materials, refrigeration equipment, dissipation of the factories' septic tanks, and other activities within the business scope.(3) Type II: Indirect greenhouse gas emissions from incoming energies, speci?cally electricity, and steam provided outside the organizational boundaries.(4)In case of any variances in the year-on-year emission reduction results between 2023 and 2022, they should be attributable to the decimal places retained. | ||
Respondent
Functionalunit
Recycledcontent (%)
Decline of carbonfootprint (%)
ReferenceSoftwareDatabaseABS JY-1000
1kgmodi?ed
plasticparticles
100≥90
HP-126
GaBi10
GaBi10.6database/Ecoinvent3.8database/GGCdatabase1.2GAR-011(L95)/GAR-011(H95)/GAR-011(R95)
95≥85HIPS-510 (R)95≥80
HIPS-5197
Accuracy, authority and recognition ofcarbon emission data based on life cycleassessment (LCA)Provisioning of data on carbon emissionsfor the whole series of plansCarbon emission data computing systemwith capability for constant improvement
Biobased solutions: bio-resin or biobased ?ameretardant Biobased additivesFactory certi?cationThird-party authoritative material certi?cationEnvironmental substance certi?cation anddeclaration of conformity for the whole batch
Complete production strengths and processcontrol of the factoryPCR Quality stability and GRS certi?cation ofraw materials. Quality stability, GRS and TCcerti?cations of raw PCR etc.A complete range of control procedures andsystems for production capacity and processstabilityProperties and quality stability of ?nishedproducts; strict control monitoring system
Gain insight into the future low-carbondevelopment trend and make advancearrangements for material solutions andcerti?cation requirements, etc.Cooperate with customers for jointdevelopment, and truly help customers achievethe goal of carbon reduction
Low-carbonProductStrategy
Data on Carbon
Emissions
Low-carbonmaterialsolutions
QualityControl
FuturePlanning
4140
2023
EnvironmentalResponsibilities
Environmental, Social and Governance Report
The Company actively carries out R&D, promotion, and application of cleaning technologies, to continuouslyimprove its technologies, expand the application scope of cleaning technologies, and enhance its competitiveadvantages.
Cleaning Technologies and Products
Cleaning Technologies and Products
Clean Technology Opportunity
Productapplicationscenarios
Productionlines/products
Key cases
All aspectsof life andproduction
Recyclablematerials
High-density polyethylene bottles are wholly recycled and successfully used aspackages of daily chemicals, thus realizing closed-loop recycling. Compared with theuse of brand-new materials, such recycling reduces carbon emissions by 60%Polypropylene is recycled from disposable lunch boxes, features low-level impurities,high cleanliness, mild odor, and high transparency. The production system for thewhole process from pre-recycling treatment to granulation has undergone thechallenging tests of the US FDA, which issued a no-objection letter to us in respect ofour recycled PP (Grade C-G) for contact with food. Our products apply to toys, food,cosmetics, and other ?elds with high requirements for environment-friendlinessWe recycle used household appliances such as washing machines, air conditioners,and refrigerators. After crushing, separation, sorting, high-temperature pre-frictiontreatment, color sorting, post odor elimination and other processes, recycledproducts with very few black spots, low VOC, desirable processing properties, andstable performance are obtainable. Our materials may be used in home appliances,furnishing, automobiles and other ?elds, to provide our customers with low-carbonsolutions
New energyvehicles
Steel plasticcompositeboards
For the steel-plastic composite boards, we adopt a continuous integrated rollingprocess, which integrates the continuous ?ber-reinforced thermoplastic compositesand high-strength steel plates for packaging. Compared with the steel bottom guardplate, these boards needn't undergo steel plate electroplating for corrosion preventionor PVC coating. The continuous ?ber-reinforced thermoplastic composites showcharacteristics such as high strength, impact resistance, scratch resistance and lowpermeability, which greatly improve the protection capability and useful life of thebottom guard platesSealedcovers
The composite laminates, with advantages such as desirable mechanical properties,low water absorption, ?ame-retardant property, air-tightness, high molding e?ciency,insulation, withstand voltage, environment-friendliness, and recyclability, may bemolded into speci?c shapes
Honeycombpanels
Being light, moisture-proof, mold-proof and highly rigid with mild odor and low VOC,PP glass ?ber honeycomb panels are moldable, and preferred alternatives to paperhoneycomb panels
CasePreparation of national standards and creation of a quick evaluation system
During the reporting period, the Company participated in the formulation of thenational standard titled Recycled plastics - Calculation of carbon emission fromphysical recovery, which is China's ?rst standard for calculating carbon emissions inthe field of recycled plastics. The standard specifies the calculation requirements,calculation procedures, system boundaries, data collection, calculation, and reportdetails for physically recycled plastic products. In addition, based on this standard, theCompany has established a "rapid evaluation system for carbon emissions of modi?edplastics" and obtained the invention patent certi?cate. The system will be used in theR&D process of modified plastics. It will horizontally compare the carbon footprintof new/ old products by adjusting inputs such as raw materials, transportation, andenergy consumption, to reduce carbon emissions of new products.
A Method for Calculation of Carbon
Emissions of Polymers/TheirProducts and a Patent Certi?cate
Productapplicationscenarios
Productionlines/products
Key cases
PV
Organicboards
Thermoplastic composite laminates, which are light, recyclable and ?exible with highstrength and low thermal conductivity, lay a foundation for lightweight applications inthe photovoltaic industryHoneycombpanels
Sandwich boards show advantages such as lightweight, high rigidity, high impactresistance, resistance to high-temperature compression, corrosion resistance, andrecyclabilityProductlines of PPE
PPE materials are mainly applied in PV connectors and junction boxes. The Companyhas developed modi?ed PPE materials, which exhibit resistance to high temperatures,high dimensional stability, and excellent low-temperature toughness. In 2023, theshipment quantity of these products exceeded 2,000t. The products may be appliedin PV modules of more than 40GW, to help each customer reduce their carbon dioxideemissions by more than 10 million tons every yearProductlines of PC
PC is mainly applied in the housings of PV inverters and power storage batteries.We have developed a highly heat-resistant, tough, weather resistant, halogen-freeand environment-friendly PC with an attractive appearance, which has been widelyrecognized by our customers. With a shipment quantity of more than 1,000t in 2023,these products may be applied in related modules of over 2GW, to support thereduction of carbon dioxide emissions by over 0.5 million tons every year
Energy storage
Productlines ofstyrene
They may be applied in ?ame-retardant ABS materials for lead-carbon energystorage battery cases, demonstrating superb resistance to low temperature, corrosionresistance, permanent weather resistance, desirable welding performance, electricalresistance and other advantages
Newenergies
Propene andhigh-purityhydrogen
Blue hydrogen, as one of the present important sources of hydrogen, has attractedmuch attention for its advantages of reducing greenhouse gas emissions and improvingenvironmental balance. Ningbo Kingfa has realized an integrated and stable productioncapacity of propylene and high-purity hydrogen through propane dehydrogenationequipment, provided reliable hydrogen sources for end customers, and promoted thewide application of blue hydrogen in di?erent ?elds. In 2023, Ningbo Kingfa produced56,101.612 tons of hydrogen-rich gases and puri?ed 144.821 tons of high-purityhydrogen. In terms of hydrogen ?lling, it owns 10 hydrogen compressors and 16 ?llingstations
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EnvironmentalResponsibilitiesEnvironmental, Social and Governance Report
Included in the list of national green factories
Environmental ManagementWhile committed to expanding production and operations, the Company attaches great importance toenvironmental protection, constantly explores green and sustainable development paths, and integrates theconcept of sustainable development into its development strategies and management activities to promoteits sustainable, stable, and healthy development. We have built a unique environmental management systembased on our own types of production, regional di?erences, and management structure. We have continuouslyand steadily performed environmental management in accordance with the latest environmental laws andregulations, as well as our own development, objectives, and policies. At present, our main domestic productionbases have been certi?ed by ISO 14001 Environmental Management System.The Company has created an HSE management network in which the general manager is the top decision-makerand leader, the system owners and the general managers of subsidiaries assume responsibilities at varying levels,and all employees participate. We clarify our departments' and employees' responsibilities for environmentalprotection and assess their performance in environmental protection. Besides, the Company implements astringent environmental accountability system to ensure that the responsibilities for environmental protectionare ful?lled, e?ectively preventing and reducing the occurrence of environmental emergencies.
The Company strictly implements the "three-simultaneity" system for environmental protection of constructionprojects, to realize simultaneous design, construction, and commissioning of supporting environmentalprotection equipment and main projects. The Company strictly supervises project design and declaration,environmental protection acceptance, and application filing for a pollutant discharge permit. We promptlydeclare the environmental impacts of our construction projects and prepare their public ?les. Internally, we also
Architecture of EHS Management
During the reporting period
the Company invested RMB
66.897
million
Team leader: general manager
The CompanyThe Company was evaluated as anA+ rated (?rst echelon) national greenfactory. The Ministry of Industry andInformation Technology proposedpromoting "green enterprise codes"among green factories on a pilotbasis, to perform a quantitative ratingof and code assignment to greenfactories. Through the green code,the Company's position among allgreen factories and in its industry isintuitively presented to the buyers,financial institutions, and relevantgovernment authorities.
Construction of National Green Factories by the Company and Its Subsidiaries
Team members: persons in charge of di?erent partsTeam memberTeam memberTeam member
The Company actively carries out the construction of green factories from six perspectives, namely infrastructure,management system, energy and resource inputs, products, environmental emissions, and environmentalperformance. During the reporting period, the Company was certi?ed as an A+ Rated National Green Factory.
Construction of Green Factories
The Company
PerformanceManagement system
Energy and resource inputs
ProductsEnvironmental
emissionsProduction process
Infrastructure
The Company's model for building green factories
Green manufacturingGreen Kingfa
in environmental protection.
gradually promote technological upgrading of environmental governancefacilities. All our projects and premises have passed the environmentalimpact assessment and undergone regular environmental audits.We have set a series of speci?c environmental goals to guide and promoteour continuous improvement and advancement in environmentalprotection. We hope to facilitate the improvement of our environmentalmanagement and environmental management measures throughenvironmental goals.
Executive deputy team leader:
deputy general manager
Deputy team leaders: system owners, general
managers of subsidiaries
Ningbo Kingfa
Kingfa BiomaterialsTianjin Kingfa
Wuhan Kingfa
Kingfa
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EnvironmentalResponsibilitiesEnvironmental, Social and Governance Report
The Company considers indicators of all departments such as administrative penalties related to environmental protection and thenumber of failures in environmental monitoring in the performance appraisal. We have established a reward and punishment systemto truly guarantee our environmental management. Besides, we require all our subsidiaries to keep and maintain environmentalprotection ?les of our environmental management process and results for reference.The Company conducts compliance assessments on its existing environmental management standards in accordance with thenational laws and regulations on the ecological environment to ensure that its environmental management complies with the latestlaws and regulations. During the reporting period, we comprehensively re?ned and strengthened our environmental management ofthe storage of hazardous waste, updated, made, and posted relevant labels and marks, made our environmental management morestandardized, and reduced the possibility of risk occurrence.The Company formulated theEmergency Response Plan for Environmental Emergencies, theInvestigation Report on EnvironmentalEmergency Resources, and other normative documents, conducted an environmental risk assessment on itself, drafted specialenvironmental emergency response plans, and issued theRisk Assessment Report on Environmental Emergenciesto identify andcontrol environmental risks in time.
Prevention and Control of Environmental Risks
During the reporting period
No general or more seriousenvironmental emergenciesoccurred in the Company, onwhich no administrative penaltywas imposed by any governmentalenvironmental protection authority.
Our recti?cation rate ofenvironmental hazards wasimplementation rate ofenvironmental monitoring
% and our
Case
The subsidiaries organized training related to environmental risks to enhancethe employees' awareness of environmental protection.The Company, its branches, and its subsidiaries regularly organize training related to environmentalrisks to increase the employees' awareness of environmental risks, prevention, and control. The trainingcovered the Company's environmental management system and process, common environmentalrisks, and prevention and control methods. Through case analysis, emergency drills, and other forms,the training e?ectively helped the employees better understand and practice the knowledge they hadacquired, and improve their ability to respond to environmental emergencies.
Shanghai Kingfa Training on ComplianceManagement of Solid Wastes
Kingfa Biomaterials Training onManagement of Hazardous Wastes
Ningbo Kingfa Training onEnvironmental Protection
The Company has adopted a series of green office measures, actively responded to environmental protectioninitiatives, reduced its carbon emissions form o?ce work, and contributed to building a cleaner and healthierworking environment and social environment.
Green O?ce
Green O?ce Measures
Develop an online approval system and an online procurement platform for o?ce supplies toencourage paperless o?ces and avoid unnecessary paper waste.Post water-saving and energy-saving signs to create a good atmosphere for energy conservationand consumption reduction.Use energy-e?cient computers, printers, and other equipment to strengthen the maintenanceand management of lighting and air-conditioning systems.When the air conditioners are in use, set temperature zoning and remind the door closing.Discontinue their operations during rest.Promptly adjust when to turn on and off the street lights and lighting devices according toseasonal changes.The elevators are put under group control and linked. Properly set when to start and shutdown the elevators based on the ?ow of people, to reduce unnecessary load-free operationsof the elevators.Strictly follow the regulations on garbage classification and disposal. Classify and markgarbage bins.
Promotion of Environmental Protection by Liaoning Kingfa
plans was
%.% of our employeesreceived on-the-job education andtraining on environmental protection.
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CaseEcological protection and green home building
Earth Day Activity of Ningbo Kingfa
Energy ManagementThe Company annually sets the overall energy e?ciency target, requires all its plants to set corresponding targetsaccording to their production and operation situation, and continuously tracks the achievement of the targets.The Company has formulated more than ten system documents such as theEnergy Management Manualtoensure the e?ective operation of the energy management system, thereby improving the energy e?ciency of itsproduction and operation. In addition, the Company regularly carries out energy-saving renovation of workshopsand signi?cantly reduces energy consumption and greenhouse gas emissions through coordinated optimizationof management and technologies.
Earth Day ActivityIn June 2023, Ningbo Kingfa organizedEarth Day publicity and environmentalactions for the employees, includingcleaning the environment, reducingpollution of wastes and plastics,actively responding to the call of WorldEnvironment Day, and practicing theconcept of sustainability.
EnergyPerformance
Targets
The energy consumption perunit has declined by 5 kWh/ton.
Actualachievements inthe modi?cationsegmentThe energy consumption perunit has dropped by 12.86kWh/ton, and the energy hasbeen saved by more than 21million kWh.
The Company conducts an in-depth analysis ofenergy consumption in the production processand reduces energy consumption by improvingprocess, procedures, equipment configuration,and equipment operation e?ciency. In addition,we strengthen our monitoring of the productionprocesses to ensure the e?ective implementationof various energy conservation measures.
The Company has established a complete rangeof energy management systems, including energyuse planning, measurement, statistics, auditand improvement. Through regular monitoring,analysis of energy use data and energy audit,the Company is able to detect energy waste in atimely manner and take corresponding measuresfor improvement.
The Company attaches importance to increasingthe employees' awareness of energy Conservationand improving their skills, and enables theemployees to fully understand the importance ofenergy conservation and actively participate inenergy conservation practices through activitiessuch as knowledge lectures, competitions andpublicity weeks on energy conservation.
The Company has established an incentivefund for energy conservation to commendand reward departments and individualswith outstanding performance in energyconservation. This incentive mechanismhas effectively stimulated the employees'enthusiasm for energy conservation andpromoted in-depth energy conservation.
The Company actively introduces and promotesadvanced energy-saving technologies andequipment, including high-efficiency motors,energy-saving lamps, and intelligent controlsystems. The application of these technologiesnot only improves energy efficiency but alsoreduces production costs.
Regularly inspect and repair production equipmentto ensure their normal operation and efficientutilization. For energy-consuming equipment,reasonable operation methods and controlstrategies are adopted to reduce unnecessaryenergy consumption.
Optimize production processesand procedures
Strengthen energy management
Carry out publicity and education
on energy conservation
Establish an incentive mechanism
Maintain and manageproduction equipment
Promote energy-savingtechnologies and equipment
Planting Activity of "Kingfa Garden"
Planting activityIn March 2023, Yuan Zhimin, who was ourchairman, led our senior managementteam and about 200 employees in aplanting activity. Different types ofyoung plan tsjackfruits , mangoes,pomegranates, and orchid trees wereplanted in the " Kingfa Garden". TheCompany hoped that all the employeescould take advantage of this activity toplant young trees of hope, fertilize theirland of ideal, achieve fruitful results ofvictory, and create new glories for theCompany's high quality development.
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CaseIntelligent power metering control system
With the goal of energy consumption and consumption reduction, the Company has continuouslyimproved the power consumption measurement method, found out the energy consumption ofequipment in each module, gradually created an intelligent power metering control system, and exploredthe space for optimizing energy conservation. In 2023, the background power metering program of KingfaMedical's mask workshop was put into use, and the power metering equipment of the glove workshopwas upgraded. The data was further re?ned and classi?ed, laying a foundation for the construction ofan intelligent control system. Data support was provided for power supply transformation of productionlines, o?-peak power consumption, to e?ectively reduce energy consumption.
CaseTechnical transformation project for energy conservation
CaseUse of clean energy
In response to the country's call for vigorous development of clean energy, the Company actively promoted theconstruction of photovoltaic power generation projects and clean energy procurement in production bases,injecting clean momentum into its green and low-carbon development.As of the end of the reporting period, our rooftop photovoltaic installed capacity reached 13.656 MW, and thecapacity under construction was 24.12 MW. During the reporting period, photovoltaic power generation wasup to 14 MWh. In the future, the Company will further promote photovoltaic construction projects, expand
rooftop photovoltaic
Key Performance
The Company identi?ed that the 8 air compressors in the South China base had muchspace for energy saving. By systematically sorting out the problems, it was foundthat the air compressors in the South China base were mainly manually monitoredand managed, but the quality of the gas output from the air compressors and theunit gas consumption were not monitored. The problems such as the operatingload of the air compressors, pressure drop in pipes, and pipe leakage could not beaccurately identified. In addition, the continuous loading and unloading of the air
compressors consumed a lot of energy. The air compressors, refrigerant dryers,and other equipment were not interlocked. As a result, after the air compressorswere turned o?, the corresponding equipment could not be automatically shutdown. In combination with the problems, the Company carried out targetedrecti?cation and reduced the energy consumption per unit by 2.1 kWh/ton.To reduce the energy consumption of production equipment, Kingfa Medical'snon-woven workshop upgraded the existing production line equipment.The waste heat of the drying tail gas generated by the water electret ovenswas recycled, and advanced environment-friendly heat exchange equipmentwas introduced. The waste heat of the tail gas was used for fresh air heatingthrough the heat exchanger cores to reduce energy loss and e?ectively cut thepower consumption of the equipment. Actual production veri?ed that after thetransformation and upgrading, the energy consumption of water electret ovensin each production line was reduced by 15%-20%.
Recovery ofwaste heatfrom melt-blown waterelectret ovens
Energyconservation ofthe compressedair system
or perform rooftop photovoltaic constructionin production bases, increase the proportion ofrenewable energy in power generation, and continueto optimize the energy structure.Besides, Qingyuan Meijin completely utilizedrenewable electricity during the reporting period.
During the reporting period, our energy consumption is as follows:
Total energy consumption1,210,877.98Tons of standard coal
Intensity of energy consumption
0.25
tons standard coal/RMB '0000 operating revenue
Medium-pressure steam
2,787,760.571TonsLow-pressure steam325,068.726Tons
Purchased electricity
199,721'0000 kWh
Secondary energy
1,334'0000 kWhPV power generation (selfgeneration for self use)
Natural gas122,408,572Nominal cubic meter
Diesel
TonsCoal water slurry424,676Tons
Propane
444,958Tons
Primary energy
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Resource Conservation
Water resources management
The Company strictly abides by the management and control quality requirements for water use, water reuse, andsewage discharge, etc. We reasonably regulate our use of water resources in daily operations, and set annual waterresources management goals and indicators based on our previous year's water resource consumption and ouroperation and development strategies. In addition, the Company identifies potential risks of water resources in atimely manner, draws up targeted water conservation plans for plants at di?erent places of business, and continuouslycarries out reclaimed water reuse projects to e?ectively improve water use e?ciency and reduce water waste.
Perform regular patrol inspections and equipment inspections to identify and resolvepotential risks in time.Perform risk assessment and analysis for water use; take corresponding managementmeasures for di?erent levels of risks.Establish a system for monitoring water consumption and water quality in real time;and ?nd anomalies and potential risks in water use through data analysis.Establish an emergency response mechanism for water safety to ensure rapid ande?ective responses to water accidents.Regularly conduct training on the safety of water use to increase our employees'awareness of water risks and their ability to deal with the risks.Improve the water resources management system; draft detailed plans and budgetsfor the use of water resources; and clarify the water consumption indicators andwater conservation targets of all departments.Regularly maintain and inspect water-using equipment to ensure their normaloperation and e?cient use; promote the use of water-saving equipment and reducedaily water consumption.Organize knowledge popularization activities on water resources and waterresources management training to improve our employees' skills in water resourcesmanagement and water conservation.Supervise and assess the use of water resources; establish an incentive mechanismfor water conservation to encourage all employees to actively participate in waterconservation activities.Appropriate use of water resources: Optimize production processes, reduce waterconsumption in the production process, and improve water resource utilizationefficiency; implement water recycling, reuse wastewater after treatment, improvesewage treatment efficiency, and reduce the demand for freshwater; strengthenrainwater collection and utilization, and reduce the use of tap water.Expand the application scope of reclaimed water: On the premise of guaranteeing waterquality and safety, explore the applications of reclaimed water in more production linksand for non-production purposes to further reduce fresh water consumption.Explore technological innovations: Pay attention to the latest technologicaldevelopment in the comprehensive utilization of water resources at home and abroad,and actively introduce advanced technologies and equipment; cooperate with scienti?cresearch institutes and institutions of higher learning to carry out research on thetechnologies for recycling reclaimed water to promote technological innovation andtransformation of achievements.Establish an incentive mechanism: Establish an incentive mechanism for recyclingreclaimed water; commend and reward departments and individuals with outstandingperformance in recycling the reclaimed water.Strengthen publicity and training: Organize training on the technologies for recyclingreclaimed water and knowledge popularization activities.
Water RiskManagement
Conservation
of water
resources
Compre-hensive
Water Use
Water Resources Management Measures
Water Resources Management Architecture
Supervise the implementation of our waterresources management policy and evaluatetheir contributions to our sustainable
development.Provide professional advice and guidance
on water resources management, andpromote innovation and developmentof our water resources management.Participate in setting annual waterresources management targetsand indicators, and review
related plans and budgets.
Perform water resources management of theCompany and ensure e?ective implementationof our water resources management policy.Set annual water resources managementgoals and targets, and approve relevantplans and budgets.Monitor the overall progress ofwater resources management andevaluate the e?ectiveness of waterresources management.Coordinate and solve majorproblems with waterresources managementand promote continuousimprovement.
Draft and implement waterresources management plans toensure that all water conservationmeasures are e?ectivelyimplemented.Regularly organize monitoringand analysis of the use ofwater resources, and proposeimprovement measures.Coordinate the water resourcesmanagement of our branchfactories to ensure that our waterresources management policy isput in place in the factories.
Perform the water resources management oftheir branch factories, to ensure ful?llmentof annual water resources managementgoals and indicators.Organize the implementation of theirrespective branch factories' waterconservation measures and supervise theuse of water resources.Report the progress and problems of waterresources management to the ProcessEquipment Department on a regular basis,and cooperate with the improvement work.
Implementing speci?c waterresources managementmeasures, including maintenanceof water-using equipment, andpromotion of water conservationtechnologies.Assist the managers of the factorybranches in water resourcesmanagement, and providetechnical support and guidance.Collect and analyze the data onthe use of water resources toprovide decision-making basis forthe management.
General Manager
Strategy and Sustainability Committee
The person responsiblefor execution: ProcessEquipment Department
Speci?c responsiblepersons: managers of thebranch factories
Executors: full-time
factory engineers
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We continuously strengthen ourmanagement and conservation ofwater resources, which not only helpsus reduce our operating costs andimprove our economic benefits, butalso makes us less reliant upon naturalwater resources, eases our pressureon water resources, and maintainsecological balance. From 2019 to 2023,the Company had reduced the waterconsumption per unit yield of modi?edproducts for ?ve consecutive years.
0.5
0.49
0.47
0.42
0.36
0.34
0.4
0.3
20192020202120222023Water Consumption per Unit Yield of Modi?ed Products in the
Past Five Years(m
)CaseProject for Recycling of Reclaimed Water in the Park
Qingyuan Base clari?es in the park's public infrastructure plan that water shall be used to the greatest extentby adopting the principle of rainwater-sewage diversion, clean water-sewage diversion and recycling ofreclaimed water. The wastewater from the production and storage areas of the entire park (including theproduction wastewater within the areas and domestic sewage of employees) is separately collected anddischarged into the production wastewater treatment system with a planned treatment capacity of 500cubic meters per day in the park. The treated e?uent is completely reused for the park's plastic cleaning,park greening and other links so that the wastewater from these areas may generally be recycled in full, andno production wastewater is discharged outside.CaseWater Circulating Operation
The Company regulates the water circling operation. After the cooling water ?ows through the heat exchangeequipment that needs to be cooled down, the temperature will rise. The water ?ows through the return pipeto the cooling tower for cooling and falls into the pool. Then, it is pressurized and transported out by thewater pump for recycling.
Store the circulating cooling water. Set upper and lower water levels for alarms. Water is automatically replenished,and water quality is inspected. The water will be discharged in case of high conductivity.
Make use of the incoming wind toconvect with the water sprinkledfrom above to drain the heatsource away, and part of the waterevaporates in the convection,taking away the correspondingevaporated heat.OperatingProcedurefor WaterCirculation
Management of Packaging Materials
The Company actively strengthens the management of packaging materials. We ensure a timely supply ofpackaging materials, reduce waste and loss, and optimize the production process to improve product quality byimplementing stringent procurement, storage, use, and recycling systems for packaging materials. In addition,strengthening the management of packaging materials is helpful for the Company to reduce the impact on theenvironment, promote green production, and create both economic and environmental bene?ts.CaseImprovement of excessive packaging
The Company cooperated with a company of logistics equipment to reduce excessive packaging,decrease the use of packaging materials on the premise of assuring quality of product transportation,and save packaging materials.Before package improvementAfter package improvement
The use of papertubes was reducedby 1,308
The use of kraftpapers and ring-shaped protectorswas reduced by5,232 and 3,924
In 2023
Cooling
waterpump
Cooling
tower
The cooled water ispressurized and transportedinto the heat exchangerzone of the workshop Heatdissipation.
High-temperature coolingwater enters the cooling towerthrough the return pipe
The cooling water that hasbeen cooled down ?ows intothe circulating water poolInlet of the cooling watercirculating pump
3 paper tubes were used
before improvement
2 paper tubes wereused after improvement
Before improvement, 4pieces of kraft paper and
1.5 edge protectors were
used for packaging
After improvement, wasteswere used for packaging
Circulatingwater pool
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Environmental, Social and Governance Report
Waste management
Performing our responsibility for environmental protection, we have formulated a series of strict pollutant managementsystems to ensure the standardized disposal of waste. Besides, we actively promote wastewater reuse projects and theconcept of "zero" direct discharge for environmental protection. We have successively carried out three waste improvementprojects for wastewater, waste gases, and wastes in our bases in Shanghai, Qingyuan, and Zhuhai. The Company hasformulated a regular inspection mechanism for pollutants, and deployed online monitoring and early warning facilities fororganic waste gases and wastewater to keep information about the discharge of pollutants in real-time.We also adjust our management measures promptly according to theList of Identi?ed Environmental Factorsto e?ectivelyreduce the negative impacts of pollutant discharge on the environment and human body, to fully ful?ll the responsibilityfor environmental protection by emitting pollutants up to standards. All our bases and branches entrust third-partyorganizations recognized by the state and local governments to inspect the pollutant treatment facilities and emissioncompliance, to ensure that all emissions conform to the standards for environmental protection. During the reportingperiod, the disposal of solid wastes, hazardous wastes, waste gases, and wastewater of the Company met the nationalrequirements, and the compliance rate of disposal reached 100%.
Methods for Disposal of Four Wastes (Waste Gases, Wastewater, Wastes and Noise)
Identi?cation of Environmental Impacts of Pollutants
Tap the potentialof waste recyclingand comprehensiveutilization.
The production ofwastes is graduallyreduced.
The disposal of wastes is scienti?c and appropriate. Control the degree of environmentalpollution within the scope permitted by national laws, regulations and standards.
Principleof WasteControlR
es
o
urce
-or
i
en
te
d
Re
d
ucti
o
n
Hazard-free
Waste gasmanagement
Based on the principle of "collecting waste gases as far as possible by quality",scientifically design an exhaust gas collection system to make unorganizedemissions organized for control.Adopt fully closed negative-pressure emission measures for new projects, andmake VOCs collection e?ciency exceed 95%.For improvement of organic waste gases, the three-chamber RTO combustionprocess is adopted, and the treatment e?ciency of the end-of-pipe treatmentprocess exceeds 90%, which greatly reduces the waste gas emission andresource utilization.
Wastemanagement
General industrial wastes are traceable and searchable in the whole processof their production, storage, warehousing, delivery, and utilization. They arerecycled internally, sold to external organizations for recycling, or generalindustrial waste treatment units are entrusted for recycling and disposal.Entrust quali?ed units to dispose of hazardous wastes.In the petrifaction segment, reduce waste discharge through the sludgedrying process.
Wastewatermanagement
Rain and sewage diversion is implemented inside factories, and 80% of theproduction wastewater from the modi?cation segment is reused for workshop?oor cleaning, toilet ?ushing, greening, and road sprinkling after treatment bya wastewater treatment station.The domestic sewage is treated with three-compartment septic tanks, anddischarged into a sewage treatment plant through the municipal pipeline afterconforming to the discharge standard.Environmental factorsEnvironmental impacts
NoisemanagementWhen equipment is updated, low-noise equipment is preferred.Annually entrust a nationally recognized environmental protection monitoringdepartment to conduct noise measurement, and prepare theBoundary NoiseMonitoring Reportand theWorkplace Noise Monitoring Report.
Dust ?yingAbnormal dust emissions harm human healthEmission of organic waste gasesAtmospheric pollution and harm to human healthPollutant leakageWater and soil pollutionDiscard of empty reagent containersSoil pollutionDiscard of empty chemicalcontainers
Failure to place wastes by class, which causes pollution of solidwastesProduction of hazardous wastesSoil pollutionNoise productionNoise pollution impairing the employees' hearing and health
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Environmental, Social and Governance Report
In 2023, Kingfa Biomaterials systematically assessed the risks in the treatment process of three wastes,inspected the treatment facilities for the three wastes and equipment on the spot in combination withthe Company's actual situation, drew up an improvement plan, and improved the treatment of threewastes in a targeted manner.
Case Improvement of treatment of three wastes by Kingfa BiomaterialsCaseWastewater puri?cation and treatment of Shanghai Kingfa
In 2023, Shanghai Kingfa designed and invested in a set of wastewater puri?cation and treatment facilitieswith a treatment capacity of 1,000 cubic meters per day for the production of wastewater in the secondphase of the project, and additionally equipped a "membrane bioreactor" as a deep puri?cation deviceto assure the quality of reclaimed water to an extent that they may be reused in different productionor auxiliary links of the reclaimed water. After the facilities were put into use, more than 1,300 tons ofproduction wastewater may be reused per month on average, achieving "zero discharge" of wastewater.
CaseRecycling of waste liquids of Kingfa Medical
In 2023, Kingfa Medical ?nished the renovation and upgrading of its chlorine absorption system and acid-alkali waste liquid system. In 2023, the chlorine absorption system recycled 1,652 tons of waste liquidto satisfy its own production needs and reduce its purchase of some raw and auxiliary materials; Theoperating e?ciency of the acid-alkali waste liquid recycling system has been improved. The quality ofreused acid-alkali has been e?ectively improved, and the acid-alkali recycling rate has increased to 70%.
Deep Puri?cation of the "Membrane Bioreactor"
All organic process waste gases are collected and introduced into organic waste gastreatment facilities, or directly burned in boilers and incinerators.Online monitoring equipment for organic waste gases are mounted at major discharge outlets.Equip tetrahydrofuran storage tank and barrel areas with exhaust gas collection facilities.The collected exhaust gases are transported to boilers for combustion and emission.The non-methane hydrocarbon with a concentration of 100 ppm or higher is covered,and equip fans to deliver the gases produced in the sewage tanks to the boilers forcombustion and emission.
Based on theStandard for Pollution Control on Hazardous Waste Storage (GB 18597-2023),Set new marks for storage facilities and new labels for hazardous wastes, and addzoning signs.Update the ledgers of hazardous wastes according to speci?cations.Promptly point out and correct problems about storage of solid and hazardouswastes on site.
Build bu?er poolsLay drainage pipesMount automatic measurementfacilities
Improvement of Waste Gas Treatment
Improvement of waste treatment
Improvement of sewage treatment
Maintain and clean sewage treatmentstationsEquip modi?ed wastewater pretreatmentsystems (under construction)
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The Company strictly abides by the national laws and regulations, including theRegulations on the Safety Administration of DangerousChemicals. Adhering to the policy of "safety first, prevention foremost, and comprehensive management", we have formulated the
Control Procedures for Hazardous Chemicals, where the regulations and requirements for procurement, storage, use, and waste disposalof the hazardous chemicals are speci?ed. The Company identi?es, strictly classi?es, and labels hazardous chemicals and records allmajor hazards of hazardous chemicals Based on theGeneral Rule for Classi?cation and Hazard Communication of Chemicals (GB13690-2009)andList of Hazardous Chemicals.In addition, our bases, branches and, subsidiaries regularly carry out hazardous chemical safetyassessments. They have formulated elaborate on-site disposal plans for chemical leaks based on their actual production characteristics,built emergency response teams, and prepared corresponding emergency materials. They regularly carry out training on operations ofhazardous chemicals and emergency drills on leaks to improve their own and their employees' ability to respond to hazardous chemicalemergencies, to minimize the harms of accidents.
Chemical safety management
Chemical Safety
CaseChemical control plan of Specialty Engineering Plastics CompanyName ofhazardous
chemical
TypeOriginal orientation of useControl plan
Acetic anhydride
(Flammable)hazardous chemicals(precursor chemicals)
Raw material for productionReduce daily storage
Acetic acid
(Flammable)hazardous chemical
By-products Reduce daily storage
Mixed xylene
(Flammable)hazardous chemical
Auxiliary material for
production
Reduce daily storage, andcancel them by the end of 20251,6-diaminohexane
(Corrosive) hazardouschemical
Raw material for productionReduce daily storage
Hydrochloric acid
(Corrosive) hazardouschemical
LaboratoriesReduce daily storageConcentratedsulfuric acid
(Corrosive) hazardouschemical
LaboratoriesReduce daily storage
Sodium hydroxide
(Corrosive) hazardouschemical
Laboratories, environmentalprotection facilities ofworkshops, environmentalprotection workshops
Reduce daily storage
Diesel
(Flammable)hazardous chemical
Forklifts
Discontinue the use of storagetanks and reduce storage
Natural gas
(Flammable andexplosive) hazardouschemicals
Boiler fuel
Deploy safety valves andpressure relief facilities;
no storage
Procurement
The Company strictly controls thesafety of hazardous chemicals from thesource, purchases hazardous chemicalsfrom qualified suppliers, and requiresthe suppliers to provide correspondingmaterial safety data sheets. For thepurchased hypertoxic, precursor,and explosive hazardous precursorchemicals, we take the initiative toreport to the public security organs byregulations and perform due diligence.
For the storage of hazardous chemicals, the Company strictly implementsrelevant regulations and standards such as theGeneral rules for the HazardousChemicals Warehouse Storage, and all hazardous chemicals are stored inapproved hazardous chemical warehouses that conform to national standards.
The Company has established a strict managementsystem for the use of hazardous chemicals. Ourrelevant procurement, storage management,safety management, use, and operation personnelhave undergone relevant training and obtainedqualification certificates by national requirements.We have maintained a complete ledger for thereceipt and use of hazardous chemicals, and regularinventories are made.
Waste disposalWe have formulated theManagement Procedures for Four Types of Wasteby relevant national andlocal laws and industry standards. The hazardous chemical wastes and other wastes produced inthe production process are collected, classi?ed, and temporarily stored according to company-levelnational waste management documents and standards, and handed over to quali?ed third partiesfor transfer and disposal. The Company performs whole-process risk identi?cation and closed-looprisk management for the compliant disposal of wastes, to make industrial solid wastes traceable andsearchable and ensure the compliant disposal of waste hazardous chemical residues.
Emergency response
We have drafted theEmergency Planfor Production Safety Incidents, areasonable, complete, and e?ectiveemergency response plan forhazardous chemicals, and organizedno less than one practical drill everyyear by the national requirements.
StorageUse
Transportation
The Company requires the suppliers of hazardous chemicals to entrust the carriers quali?edfor road transport of dangerous goods to carry hazardous chemicals. We strictly control andinspect the incoming vehicles transporting hazardous chemicals, requiring the vehicles andtransport personnel to take fire and explosion prevention measures when entering areaswhere flammable and explosive hazardous chemicals are stored and used. The vehiclesand personnel shall also be equipped with sufficient and effective emergency treatmentequipment and facilities as well as personal protection equipment.When handling hazardous chemicals within the Company, each department shall formulatesafe operating procedures for handling hazardous chemicals based on the characteristicsof hazardous chemicals, and educate and supervise employees to handle the hazardouschemicals in a standardized manner.
Besides, the hazardous chemicals are separately stored in di?erent areas andwarehouses by properties. The hazardous chemicals warehouses shall bemanaged by personnel with corresponding professional knowledge and safetyskills, and equipped with reliable personal protective equipment.The warehouses are equipped with corresponding monitoring, ventilation, sunprotection, fire prevention, fire extinguishing, explosion protection, pressurerelief, anti-poisoning, disinfection, neutralization, moisture protection, lightningprotection, anti-static, anti-corrosion, anti-leakage, embankment protection,isolation, other safety facilities, and equipment according to the types andcharacteristics of hazardous chemicals, to ensure safe storage of hazardouschemicals all the time.
The Company is equipped with personal protectiveequipment up to national standards, strictlyrequires the employees to wear correspondingpersonal protective equipment when operatinghazardous chemicals, and regularly conducts safetyinspections, practical training, and emergency drills.
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Social Responsibilities
SDGs：
R&D investments
1.973
RMBbillion
Percentage of supplierssigning theCode ofConduct for Suppliers
%
The Company'stotal externaldonations
635.16
RMB '0000Hours ofparticipation involunteer activitiesper employee
27.3
Hour
440,232.29
Total training hoursof employeesHour
41.3
Average traininghours of employeesHour
Technological innovation
The Company has continuously developed the world's leading technology R&D platform, created an R&D systemknown as "13551", improved its independent R&D capabilities, and developed clean renewable new products to leadthe industry's technological upgrading, in an attempt to become a global leading enterprise of new chemical materials,achieve high-quality development, and make technological innovations to serve the country through industry.
Upholding "making independent innovations, taking the lead in technologies, and creating excellent products",the Company has been accumulating technologies and studying products. Progressively, we have built an R&Dplatform driven by technology, industry, and product research. We have made constant efforts in four majorsectors, namely modi?ed plastics, advanced materials, green petrifaction, and medical health, where we haveintegrated our strategic concept for low-carbon cleaning technologies, R&D and scienti?c innovation outcomes.
"13551" R&D System
Core R&D Resources
central research institute
international R&D centers
technical sub-centers
incubation bases for new chemical materials
national industrial innovation center
Four Major Sectors and Product Applications
Modi?edplastics
Modified plastics and environmentally friendlyhigh-performance recycled plastics
Automobiles, household appliances,electronics and electricians, newenergies, consumer electronics, etc.Greenpetri?cation
Light hydrocarbon and hydrogen energies,polypropylene resin, styrene resin
Modi?ed plastics, household appliances,automobiles, toys, daily chemicals, etc.
Advancedmaterials
Fully biodegradable plastics
Packages, agricultural ?lms, tableware,3D printing, etc.Special engineering plastics
LED, electronic devices, electric appliances,consumer electronics, new energies, etc.Carbon ?ber and composites
Automobiles, unmanned aerial vehicles,new energies, containers, etc.Bio-based monomers and resin
Film bags, automobiles, householdappliances, electronic devices, electricalappliances, new energies, consumerelectronics, etc.Medicalhealth
Personal protective equipment (PPE), non-wovenmaterials, IVD consumables
Professional medical treatment, industrialprotection, air and liquid ?ltration,laboratory testing, etc.
SectorsProductsDownstream application ?elds
KINGFA India
KINGFA (India)
KINGFA Malaysia
KINGFA (Malaysia)
Kingfa (Europe)
Electronic and electricevaluation platform
Kingfa (USA)UL cooperation platform
KINGFA EuropeKINGFA USA
Liaoning Kingfa
Liaoning ABS Innovation, R&DEngineering Center
Tianjin KingfaOptical Materials Industry R&D andApplication Evaluation CenterShanghai KingfaAutomobile Material R&D andApplication Evaluation CenterHead O?cePolymer Synthesis Institute, PhaseII Laboratory and Pilot Scale KingfaMedical - Academician Wang YingjunJoint Laboratory, ApplicationEvaluation Center for Electronics andElectrical Industries
Zhuhai BaseZhuhai Advanced MaterialsEngineering Center
Wuhan Kingfa
Agricultural Materials R&D and ApplicationEvaluation CenterNingbo KingfaNingbo High-performance PolyolefinEngineering Center
Chengdu KingfaSpecial Industry Material R&D andApplication Evaluation Center
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As of the end of the reporting period
Educational structure of R&D personnel
R&D investments from 2021 to 2023
(unit: RMB 100 million)
Project Management Procedure
the Company had had
Foreign academician
China Patent
senior engineers
doctors1,136 masters
19.73
14.54
14.55
The Company has always been guided by market demand and striven to make breakthroughs in key commontechnologies with the focus on the "breakthroughs in key industries", industry needs, and applications. We assure ourproduct quality in the whole process from R&D to production and delivery through our production technology andquality platforms. The Company has prepared relevant project management system documents, standardized theimplementation of R&D project management measures, and clari?ed the process requirements for each project phase.
Annually collect project needs andorganize review meetings for projectapproval; include the approvedprojects in the annual projectmanagement list.
Regularly perform supervision andperformance appraisal of projectsduring their implementation, toguarantee punctual delivery of theprojects.
Complete acceptance inspection ofa project upon completion withinone month after the completionand organize an acceptance reviewmeeting. The expert judges willconduct the review and score. Finally,the project rewards will be determinedand issued according to related rules.
Project Development Management
63.4%
5.6%
31.0%
Management of project
needs and initiation
Project process monitoring
and management
Project acceptanceand incentivesBachelor's Degree and belowPhDsPostgraduates
We won
National science andtechnology progress awards
First Prizes for Provincial andMinisterial Science and TechnologyProgressExcellence Awards
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Key technological R&D projects during the reporting period
?We have constructed a technology R&D platform for syntheticbiology, developed engineering strains, built core technicalcapabilities, and expanded the "new tracks" for biologicalmonomers and bio-based materials. The bio-based 1,4-butanediol (BDO) developed by us has passed the bio-basedcerti?cations of international authoritative organizations suchas USDA (USA) and DIN CERTCO (Germany). We have launchedECOPOND? KB100 NC806/A300 NC806/A200 NC806 seriesbiodegradable polyesters and their modi?ed products with bio-based content of 35% ~ 100%, reducing carbon emissions ofend products, and deploying a low-carbon industrial chain formonomer-polymerization-modi?cation.?Particularly, we have overcome industry difficulties such asdifficult molding and processing of biodegradable mulch?lms, poor moisture retaining performance, and short weatherresistance time, strengthening the adaptability to planting areasand crop growth characteristics, and completing the iterativeupgrading of three special materials of biodegradable mulch?lms. The key national R&D program of the 14th Five-Year Plantitled "Preparation and Industrialization of Special Materials
Advanced materials
Fully biodegradable plastics
for Biodegradable Mulch Film and Products" (2021YFD1700703)successfully passed the milestone assessment. The productsconverted from this program received positive market feedback,which facilitated China's demonstration and promotion ofbiodegradable mulch ?lms for scienti?c application.?We have developed special polyesters with superb ?ow properties,quickly molded materials for modification and other newproducts. Signi?cantly improving the processing and mechanicalproperties of the materials and shortening their molding cycle, wehave successfully broken through the traditional scenarios. Theproducts have been applied in medicine, toys and other ?elds withhigh added value.?We have developed PLA-specific modified materials for high-speed 3D printing. The molding e?ciency of these materials hasbeen signi?cantly increased, realizing energy conservation, carbonand emission reduction. The printing speed is 10-fold higher thanthe conventional printing speed and takes the lead in the world.?We have developed the world's first 100% bio-based PBSmaterials for contact with food, and passed DIN CERTCO'sbiobased certi?cation.
?We have developed a new type of highly transparent sprayablepolypropylene material, which has been successfully applied inautomotive light-permeable bumpers. This is the world's firstinstance of the application in mass production for "integratedluminous front face", leading the new trend of the industry.?We have created a multi-dimensional product matrix, which issuitable for multiple molding methods such as blister molding,blow molding and injection molding. Multiple functions havebeen realized, including good appearance, lightweight, thin-walled flame retardancy and ablation resistance. We havecontinuously launched iteratively upgraded solutions tobattery pack covers, which have been highly recognized by ourcustomers and put into use in the market.
?Through stable comparative tracking of flame-retardantengineering plastics, we have developed electrical insulationand thin-walled flame retardancy of the products, with great?Having made breakthroughs in pollutant identi?cation, transferof trace substances, and rapid assessment of trace elements,we have established a complete system for recycling tracing,risk assessment and control of waste plastics, which has beenawarded several international third-party certifications anddomestic and foreign patents.
Modi?ed plasticsModi?ed plastics
Environment-friendly high-performancerecycled plastics
potential for development in the industry of clean energies.?Having performed continuous R&D of key fields, includingmaterial failure mechanisms during their service life, acceleratedlife evaluation and regulation, we have obtained several UL yellowcards and RTI certi?cation.?Focusing on studying complex interfacial properties, we havemade breakthroughs in regulating surface hydrophobicity of thePC/PET alloy system materials filled with mineral powder, lighthigh-performance nylon with low warp, and styrene materials. Wehave enhanced our capacity for material applications in the ?eldsof automobiles, electric tools, PV, energy storage, electronics,electrical appliances, etc.?We have developed several types of creative aesthetic materialsand optical functional materials, thus diversifying the productappearances.
?We have organized the formulation of relevant standards
for recycled plastics and launched a variety of high-grade
environmentally friendly high-performance recycled plastics,
which have been widely used in plastic packaging, household
appliances, automobiles, consumer electronics and other
markets.
?We have broken through several key technologies forindustrializing Polyaryl ether sulfone, and met the projectexpectations for equipment with a production capacity of tenmillion tons.?We have constantly optimized the applications of our productssuch as highly electrically safe halogen-free flame-retardantsemi-aromatic polyamide, high-strength coolant resistantsemi-aromatic polyamide, highly heat-resistant LCP, andextrusion grade special polyamide in the core components ofnew energy vehicles, including batteries, motors, electroniccontrol units, thermal management systems and charging piles.Breakthroughs have been made in our leading customers ofthat industry.?The series of conductive LCP developed by us has beenunprecedentedly applied by several domestic and foreignmainstream customers' high-speed high-frequency connectors,which have ?lled up the blank in China. We have optimized andupgraded the flame-retardant semi-aromatic polyamide andhighly heat-resistant LCP, having made breakthroughs in theirapplications in low-voltage electric appliances, relays, motors,
Advanced materials
Special engineering plastics
and cooling fans, which have become our new growth points inthe electronic and electrical applications.?Breakthroughs have also been made in the superb electricalproperties and aging resistance of the latest high-temperaturenylon, which has been successfully applied in the field of newenergy vehicles.
?We increase our resource inputs in the underlying research onlow costs and flame retardancy, constantly break through thebottlenecks in ?ame retardancy and enhance our competitivenessin thermoplastic composites in the industry of new energyvehicles.
?We have developed a type of strips with high appearanceconsistency that contains 80% glass ?ber, to enhance our capacityfor market development and technical application in respect ofthermoplastic composites.?A type of thermoplastic prepreg strips and composite sheets withhigh appearance, quality, and thickness uniformity has beensuccessfully applied in the industries of new energies and coldchains, etc.
?We have developed a one-step method for direct production of modi?ed ABS, functional ABS products, and products with highcontent of SAN along with high impact resistance, ?ow, luster, and weather resistance, which are recognized in the market.?The pilot COC equipment independently developed by us manufactures COC products, and we have constantly improved theproduct properties by continuously optimizing their production process.?We have independently developed a hydrogen ?lling process to facilitate the industrialization of hydrogen puri?cation, and sellhigh-purity hydrogen.
Green petri?cation
?Domestic products with technological "bottlenecks", including NC ?lms and fabrics made via ?ash distillation, havebeen put into pilot production, and laid a solid foundation for subsequent mass production.?The integrated biodegradable personal protective equipment, in-situ anti-bacterial melt-blown products, highlybiodegradable nitrile gloves, second-generation ultra-soft gloves, accelerator-free gloves, and other high-tech productshave been launched in the market and highly recognized by the customers.?We have developed new products such as ultra-low temperature-resistant cryogenic storage tubes, highly hydrophilic?ltration materials, and highly chemical-resistant nitrile gloves, to satisfy the high-end market needs.
Medical health
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Product quality and safetyUpholding "maintaining survival based on standards, becoming powerful in reliance upon the quality and takingthe customers ?rst", the Company standardizes the closed-loop PDCA management by guaranteeing "availability,usefulness, quality, and superiority of the standards". We promote lean quality management and stabilize ourproduct quality, to build the brand of Kingfa with "Kingfa-specific quality", and satisfy and exceed customerexpectations.
The Company has established quality control systems such asQuality Manual and Incoming InspectionProceduresand formulated quality control measures for the whole process of products to ensure that the qualitymeets the prescribed standards in all links, stabilize the shipment quality, and ensure product safety.Duringthe reporting period, the Company and its 17 subsidiaries or production bases passed the ISO 9001 QualityManagement System Certi?cation. The Company and some of its subsidiaries or production bases passed IATF16949, GMP, ISO 13485, 5GONOGO, and other quality system certi?cations.
The Company prevents and averts recall risks ahead of risk analysis. We standardize the after-sales productdisposal process, specify the recall process and the responsible department in theQuality Control Speci?cationsfor Product Shipment, and incorporate on-site product return and recall data into our performance indicatorsrelated to customer satisfaction to protect the rights and interests of customers responsibly. Since itsestablishment, the Company has not experienced any recall.
The Company uses online automatic detection equipment in the production process. The equipment has beenindependently developed by the Company, which has independent intellectual property rights in the equipment.The equipment is the industry's ?rst quality detection tool. Based on AI identi?cation, IOT, intelligent hardwaredesign, and modification of intelligent monitoring equipment, the equipment fulfills four core detectionindicators. The detection cycle is about 5 minutes, and the stability of the production process is monitored in real-time, to increase the utilization rate of the production line, reduce the overall detection costs, and perform thedetection procedures with the involvement of fewer personnel. Besides, the equipment is subject to post-clustermanagement. A distributed network architecture for automatic online monitoring is built through micro-servicesand other methods to increase the reliability and responsiveness of the system.Quality Control over Processes
Product Recall
According to the productrecall orders of the QualityDepartment, recall thenon-conforming productsfrom the market and carryout subsequent work.
Make transportationarrangement for therecalled products andimplement correspondingmeasures according tomarket requirements.
Control quality in thewhole productionprocess and analyze thecauses of nonconformingproducts. Supervisethe implementationof correspondingmeasures and follow-upimprovement measures.Product Recall Procedures
Automatic online detection systemThe eight functional modules realize automatic sample preparation, as well as automatic testing ofdensity, color, heterochromatic points spiral ?ow length (?uidity), and implicit qualitative monitoring.The system gives timely warnings and automatically pushes anomaly information.
Truly make it unattended
Automaticonlinereclamation
Automatic washing
machine forproduction transfer
Automaticmold change
system
Automatic
systemcontrol
Online testingof fourindicators
Operations Department
Planning and Warehousing
Department
Quality Department
Quality Control Procedure
Quality support
resources
The operational environmentand the measurement systemare up to standards. The humanresources meet the capabilityrequirements. The documentsystems are standardized.
External operations
managementStrictly select and managesuppliers; develop a supplierquality management system andperform second party audits
Planning risks and
opportunities
Analyze risks, and drawup preventive measures,quality standards andplans for their realization
Operations forquality controlKeep customer informationcon?dential; specify productand service requirements;review design and developmentoutputs
Provisioning ofproduction services
Standardize operations andmake labels traceable; auditproducts and provide customerservices; dispose of thenonconforming products in thereported channels
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The Company consistently guarantees product safety, strictly controls the use of hazardous substances in products, and establishes a safetyassessment mechanism for hazardous substances to ensure that the production process complies with regulatory requirements and deliversproducts and services up to high standards. During the reporting period, the Company and its two subsidiaries obtained the QC 080000Hazardous Substance Process Management System Certi?cation.The Company has formulated theTechnical Standards for the Control of Hazardous Substances,to specify the substances prohibited frombeing used in raw materials, prevent the hazardous substances from being mixed into the Company's products, ensure compliance with lawsand regulations, protect the environment of the earth and mitigate the impacts on the ecosystem. We have continuously updated our controllist of hazardous substances in raw materials, conducted a thorough investigation of the risks of hazardous substances in the supply chain,identi?ed a total of 17 risks, and drafted a control plan for the reduction of hazardous substances to achieve product safety compliance andreduce the use of hazardous substances and substances of very high concern. Ningbo Kingfa has replaced the two hypertoxic reagents requiredfor the assays during the laboratory analysis, thus reducing the on-site safety risks. If the hazardous chemicals involved in each operation stageare replaced by those with intrinsic safety, all the chemicals have been optimized.
Management of Hazardous Substances
Disposal of Hazardous Substances by Level
Level I
1,2-Bis (2,4,6-tribromophenoxy) ethane, 4,4-Sulfonyldiphenol, barium borate,3,4,5,6-tetrabromobenzene-1,2-dicarboxylate (including any separate isomers and/or theircombinations, 2-methylpropylester 4-hydroxybenzoate, per?uoroheptanoic acid and itssalts, reactants of 2,2,3,3,5,5,6,6- octa?uoride-4 (1,1,1,2,3,3,3- isobutyl 4-hydroxybenzoate-2-yl) morpholine and 2,2,3,3,5,5,5,6,6-octa?uoroalkyl -4-(hepta?uoropropyl) morpholine,diphenyl (2,4,6-trimethylbenzoyl) phosphine oxide, 4,4-dichlorodiphenyl sulfone,2,4,6-TTBP, 2-[2-hydroxy -5-(1,1,3,3-tetramethylbutyl) phenol ] benzotriazole (UV-329),2-(dimethylamino)-2-[(4-methylphenyl) methyl]-1-(4-morpholin-4-ylphenyl) butan-1-one,methoxychlor, Dechlorane Plus and mineral oil
Prohibited
Level IIIsopropylphenyl phosphate and PFAS, etc.AlternativeLevel III
Tetrabromobisphenol A, Melamine, 2-(5-chloro-2H-benzotriazole-2-yl)-6-(1,1-:Dimethylethyl)-4-methylbenzenel, and oligomerisation and alkylation reactants ofisopropenyl benzene and phenol
Restricted
We attach great importance to the overall quality building of our teams and conduct internal quality-related training tosatisfy our needs for high-quality development and global quality talents. Externally, we publicize our quality cultures. As arepresentative outstanding enterprise, the Company shares quality management experience, tells corporate brand stories,spreads excellent quality culture, creates the brand "Kingfa", explores new paths and new drivers for Kingfa's technical qualityinnovation and brand building, and supports its development strategies with one hundred billion.During the reporting period, to meet the needs of the company's high-quality development and global quality talents, theCompany further improved the training plan for quality talents, and established corresponding training project systems forcampus recruitment, onboarding, novice, and other core stages. We continuously pay attention to our employee growth, builda team that is "able to ?ght and win", and improve the professional quality skills of the team.
The Company enters into environmental protection agreements with suppliers, clari?es the list of di?erent environmentallycontrolled substances to the suppliers, and requires the suppliers not to use these substances. In addition, the Companyseparately reviews the prohibited substances in assessing the new and quali?ed suppliers. In case they fail in the review ofprohibited substances, the suppliers will be required to complete rectification and undergo further assessment within onemonth. If the suppliers remain unqualified in the further assessment, new suppliers will not be introduced, and originalsuppliers will directly become disquali?ed.
Development of Quality Cultures
Internal quality training system
Level I
Level IIILevel II
Control List of the Company's Common Hazardous Substances
Immediately ban corresponding target substances and their uses in the products. Suchsubstances are banned from addition to any articles, and the content in each productcomponent must meet these control requirements or special customer requirements.However, the approved recognized projects may be exempted from these requirements.
The substances are considered to be harmfulto the human body and environment, butat present, the prohibited period of use isnot speci?ed, and the suppliers need to payattention to the use of such substances. LevelIII controlled substances will automatically beconverted into Level II with the promulgationof relevant new regulations.
Deemed harmful to human body andenvironment, they are banned fromuse after the specified date. If thesuppliers utilize such substances inthe production process, it is necessaryto consider and draw up plans forreducing and gradually replacingthese substances.
Control levelList of substancesControl method
Green laboratory of the National Industrial Innovation Center
The National Industrial Innovation Center has built a characteristic green laboratory and formulated control procedures forlaboratory tests to ensure the effectiveness of test and analysis results, reduce test and analysis errors, and guarantee thedesirable accuracy and credibility of the test data.
Environmental safetyassessment laboratoryBuild a quality control platformfor the entire industry chainso that the polymer industrychain may control and evaluateenvironmentally harmfulsubstances from the source,ensure that the content of harmfulsubstances in products meetsinternational standards andregulatory requirements, andmakes sure of supplying safer andmore compliant products
Environmental reliability
laboratory
Complete thermo-oxidative aging,photoaging, and damp heat agingof di?erent polymers under speci?cexperimental environments, andtest the changes in their propertiesto evaluate the long-termapplication safety and applicabilityof the materials. With a matureaging laboratory environment, it iscapable of tracking and monitoringthe aging performance.
Green sustainabledevelopment laboratory
Provide the enterprises of thepolymer industry chain with "one-stop" solutions to applicationtechnologies of recycled plastics,carbon footprint calculation,performance evaluation, and lifeevaluation solutions, includingsupply of green and low-carbonproducts, identification of recycledplastics, corporate carbon inventory,product carbon footprint accountingand other product lifecycle services.
Topic research
Induction Training
Learning about what
should be known
Pre-job training
Spark planCultivation ofquality stars
Golden Shield ProgramCultivation of corequality talents
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Case
Case
Golden Shield Program
Remarkable quality action results release in Guangzhou
Regarding the cultivation of core quality talents, the Company launched the Golden Shield Program(Phase 1) during the reporting period, selected core 54 quality backbones from its bases, and organized atotal of 5 training sessions, 14 courses, 9 practice tasks, and 4 special surveys within one year. The GoldenShield Program was smoothly completed, and we accumulated valuable experience for the subsequenttraining of high-end quality talents.
Golden Shield Program
"Guangzhou Brand"Award Ceremony
The Company's Selection as a Typical Caseof Chief Quality O?cers' Quality Reformand Innovation in Guangdong Province in
2023
Brand Story of KINFA Evaluated as Oneof Top 30 Excellent Short Videos on"Guangzhou Brand Stories"
Customer services
Focusing on customer services, we maintain in-depth cooperation with our customers, in an attempt to build a?rst-class marketing platform. Through the world's leading technical R&D platforms and reasonably distributedglobal marketing networks, we provide our customers of different industries with overall cost-effectivecustomized material solutions.
Improvement of the Customer System
"Production based on sales" is our majorproduction model. Specifically, the customersput forward order requirements such as productperformance and functional requirements.The Company organizes product production,inspection, and delivery according to marketconditions, inventories of raw materials andproducts, and equipment status.
The sales model is mainly oriented by markettrends and customer needs. While sellingproducts, the Company also needs to providecomprehensive technical support services fordownstream customers. This business featurecontributes to the Company's selection ofdirect selling as its major sales model.
Create a global collaborativeservice network in China(?ve bases in East, South,West, North, and CentralChina), India, the UnitedStates, Europe, andMalaysia. Adhere to theservice concept of rapidresponse, and respond tocustomer needs promptly.
Appoint key accountmanagers to perform delicacymanagement. Conduct in-depth research on customerrequirements based oncustomer needs and providecustomers with overallsolutions.
Appoint major industry leadersto coordinate the formulation ofindustry development strategiesand tactics, intensively embarkon subdivided ?elds, and focuson industry needs. Cooperatewith technical industry expertsto study the developmentorientations and needs of theindustries based on industryneeds. Provide overall solutionsfor the industries.
Customer service model
Production modelSales model
Three-in-onecustomer service
systemRegions
Customers
Industries
In September 2023, the Company participated in the "Kickoff Ceremony of 2023 Guangzhou Remarkable QualityAction Results Release and Quality Month" with the theme of "Guangzhou Brands of Wonderful Quality" held by theGuangzhou Municipal Quality Improvement Work Leading Group O?ce. On the event site, the typical cases in chiefquality o?cers' corporate quality reform and innovation were released. The Company was included in the list of suchtypical cases of Guangdong Province in 2023. Evaluated as Top 30 with an outstanding short video on the "GuangzhouBrand Stories", the Company received the award as one of 10 award-winning representative companies.One representative attended the event upon invitation and made a speech: "Excellent quality is inevitable foran enterprise. In operations management, we've found that there are contradictions and conflicts betweenthe customized needs of our customers and our large-scale production mode. Through innovative quality andstandardized management, the needs and the production mode have been organically integrated. We have built andimplemented a "rigid and ?exible" quality management model, to create a wonderful life."
Adhering to the marketing concept that "orders are commands and contracts prevail", the Company creates a globalcollaborative marketing network around customer needs, develops a customer service system integrating regions,customers, and industries, and empowers regional operations through industry development and key customer traction.
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Information on how and where to?le a complaint shall be disclosedto the customers, employees andother interested parties.
Case
Case
Cooperative R&D of plastic alternatives for upper battery caps
Strategic cooperation and exchange
The Company cooperated with CATL to develop the world's ?rst ablation-resistant injection molded upper caps for power battery packs, replacingsteel with plastics. The two companies cooperate based on projects. Theyconducted several studies on patent layout and long-term performance,achieving weight reduction by over 50%, high-efficiency production,and cost reduction. Our marketing team has conducted many exchangeswith our customers on ablation-resistant materials and guided the corepersonnel of our customers to jointly develop products with us. Theseproducts have been successfully put into mass production. We haveprovided brand new advanced solutions to continuous weight reduction,energy saving, efficiency improvement, and improvement of energydensity for the power battery pack boxes. In 2023, this project won the"Foresight - Equipment, Process and General Gold Medal" of the EighthLingxuan Award for the Chinese Automobile Industry.
In 2023, the Company conducted strategic cooperation and exchanges with customers, created a greenand low-carbon supply chain, and expanded the cooperation between the two parties on a global scale.
"Foresight - Equipment,Process and GeneralGold Medal" of the Eighth
Lingxuan Award 2023
Strategic cooperation and exchange
The Company has formulated customer service systems such asCustomer Complaint Management Regulationsto providecustomers with prompt services before, during and, after sales, quickly standardize the process for handling customercomplaints, respond to customer demands promptly, and improve customer satisfaction with its products and services.
Interactions and Exchanges with Customers
Honors in customer cooperation
Dongfeng Nissan - the 20th-anniversary Partner Award
MAHLE China - TechnicalCooperation Award for aSupplier
Inteva China - 2023Excellent Service Award
Inform the complainant in a timelymanner after receiving a complaintand deal with it dependent uponthe degree of urgency. Treat thecomplainant politely, and informthe complainant of the complainthandling progress.
Make the complaint handlingprocess open to the complainantsfree of charge
Be committed to adopting acustomer-focused approachto make feedback (includingcomplaints) public and addresscomplaints with actions.
The complaint handling processis easy to operate. Detailedinformation about complaintsand complaint handling can beobtained and clearly expressed.
When necessary, the personallyidentifiable information of thecomplainants shall not be disclosedwithout the consent of the customers orthe complainants. Take the initiative toavoid disclosure of such information.
Treat all complaints equally, fairlyand impartially.
Ensure establishing accountabilityand reporting systems for complaintshandling and decisions.
Guiding principles for handling customer complaints
The complaint handling processand continuous improvementof product quality are eternalorganizational goals.
TransparentResponsiveFree
Focus on customersConvenientCon?dential
FairResponsibilitiesContinuous improvement
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Tel:+86(020)-66818888Fax:+86(020)-66848888
Graded responses to complaints
CaseCustomer satisfaction statistics
During the reporting period, the Company statistically analyzed the customer satisfaction among the keycustomers, particularly customer satisfaction with delivery, and invited the customers to score the actualperformance of the Company's order delivery and services during the reporting period. The satisfactionquestionnaire survey was carried out twice a year. Each time, analysis is performed for improvement andclosed-loop tracking based on the customer evaluation results. According to statistics, customers wererelatively satisfied with our services, with an average score of 91.9 points in customer satisfaction withdelivery in the ?rst half of the year. In the second half of the year, the Company made targeted improvementsto the customer satisfaction evaluation for the ?rst half of the year. The average score in customer satisfactionwas 92.9 points in the second half of the year, and customer satisfaction was further improved.
Measures for Improving Customer Satisfaction
Supplier Management System
Our marketing activities comply with the Advertising Law of the People's Republic of China, other relevantlaws and regulations, as well as our internal audit system. We strictly control and review external marketinginformation, to prohibit their exaggeration or distortion. All our marketing and publicity-related materials mustbe jointly approved by the Marketing Center, the Securities Department, and the Corporate Publicity Departmentbefore they are o?cially made public, to ensure that the publicity content is legal and compliant. We have alsoformulated corresponding management requirements and labeling procedures for product identification, tostandardize our identi?cation. As of the end of the reporting period, the Company had not received any litigationor violation penalties related to product identi?cation.
The Company has established and improved the supplier lifecycle management system, built a suppliermanagement platform, formulated differentiated supplier introduction rules and daily management modelsbased on its management needs for different segments and varieties, and performed visual management ofthe businesses with the aid of the platform. We pay close attention to the construction of our suppliers' qualitysystems and environmental and social responsibility systems, mobilize resources to empower the suppliers,continuously optimize our supplier management, improve the supply chain e?ciency and ?exibility, and ensureour smooth production.
Responsible Marketing System
Supplier Management System
Address: 33 Kefeng Road, Science CityPostal Code: 510663
Sustainable supply chainEmergentUrgentGeneral
O?er an emergencyresponse within 8 hours, andprovide the investigationresults within 2 workdays.In case of any anomaly,contact the superior or thecomplainant in time to givean explanation.
O?er an emergencyresponse within 12 hours,and provide the investigationresults within 2 workdays.In case of any anomaly,contact the superior or thecomplainant in time to givean explanation.
Handle the complaint normally, and o?er aninitial reply or suggestions within 1 workday.Make the ?nal suggestions on how to handlethe complaint within 3 workdays. If thecustomer puts forward special requirementsfor time, reply within the time limit speci?edby the customer. Promptly report theanomalies to the complainant in the processof complaint handling if any.
Customer feedback channel
O?cial Account: Kingfa
Advanced Materials
Capacity building for
service personnel
Continuous improvement ofresponsiveness to orders
Improvement of customers'
Delivery Experiences
Supplier Management Platform
Supplier resource pool
Trading suppliers
Quali?edsuppliers
IntroductionmanagementRisk control mechanism
Collaboration mechanism
Relationshipmanagement
O?boarding management
Performancemanagement
Classi?cationmanagement
Quali?cation pre-examination
SupplierconferencesBusinessexchangesTechnicalexchangesQualityexchangesPlatforminteractions
Risk warning(credit, ?nance,quality, delivery)Contract guarantee
(technologies,quality, supply, social
responsibilities)
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Supplier management
Formulate supplier introduction rules to standardize the selection and management process of new suppliers. Establishdi?erentiated supplier introduction standards based on the needs for category management, to strictly control supplyrisks, evaluate upstream supply capabilities, and accommodate the needs for resource reserve and optimization.The Procurement Department conducts a pre-quali?cation review for all potential suppliers. The raw materialsuppliers shall at least pass ISO 9001 certi?cation, and attention is paid to the suppliers certi?ed by ISO 14001,ISO 45001, and other relevant systems. Conduct on-site audits when necessary. Comprehensively evaluate thesuppliers' operation status, production capacity and, management, to improve their overall quali?cation.
Onboarding management
Formulate theSupplier Audit Management Regulationsand conduct routine audits for key suppliers accordingto the audit plan. Evaluate whether the suppliers' management systems remain e?ective and are continuouslyimproved. Audit problematic suppliers to evaluate the e?ectiveness of the suppliers' problem improvements, toeliminate the suppliers with supply risks promptly.
Audit management
Formulate theSupplier Performance Management Regulationsand continuously pay attention to thesuppliers' performance in delivery, quality, and services, Output the overall performance results of theraw material suppliers every quarter and put them into practice. Provide the suppliers with correspondingincentives, rewards, and punishments for the suppliers with di?erent performance levels (A-D). Improve thee?ciency of the supply chain, and realize the di?erentiated demonstration of supplier value.
Performance management
In combination with supplier performance and category management strategies, formulate supplierclassification rules, output strategies, as well as differentiated management measures for bottlenecks,collaboration, and general suppliers. Establish targeted management measures for strategic and bottlenecksuppliers. Set integration goals for the general suppliers, and promote continuous optimization of supplierresources. Achieve precise allocation and e?ective integration of resources.
Classi?cation management
Closely track the political, military, economic, climatic, and other trends in di?erent regions of the world.Identify risk factors and draw up risk plans in advance. Adjust procurement and inventory strategiespromptly, including increasing raw material reserves, locking raw material orders in advance, and makingearly preparations for raw material substitution. Eliminate potential adverse e?ects of risks.Establish an early warning mechanism for high-risk raw materials, and keep informative about the supplychain by continuously tracking the production status of upstream suppliers and signing four majoragreements with the suppliers, including supply agreements, quality assurance agreements, environmentalprotection agreements, and technical agreements.
Risk Management
Supplier conferences, technical exchanges, daily business exchanges, quality exchanges, andplatform interactions, etc.Collaboration management
CaseDigital supply chain transformation project
We continuously promote the application of the SRM system, and nearly 100% of suppliers have been connected to the systemfor management, to strengthen the overall audit efficiency, ensure that records are searchable and traceable, promote thesystematization and standardization of our annual supplier audit, and realize transparent procurement. In August 2023, ourdigital end-to-end management transformation project not for raw materials was initiated. We established an end-to-endmanagement system not speci?c to raw materials for the whole process (including budget, demand, planning, order placement,procurement, inventory, and accounting), and a mall management mechanism for continuous launching, to realize transparentprocurement in e-commerce and digital driven management. These systems were formally launched in January 2024.
Supply Chain Digitalization Project
The Company works closely with the suppliers to jointly remain committed sustainable development goals and create tosustainable value. Use the o?cial platform of the SRM system to conduct training on sustainable development for the suppliers.Perform sustainability risk assessments and supplier audits on their environmental and social responsibilities through writtenmaterials to identify the suppliers' ESG performance, and plan corresponding sustainable corrective actions to ensure that thesustainability management of the supply chain is fully implemented.
During the reporting period, the Company conducted surveys on corporate carbon management of 88 suppliers. Among them,86 suppliers replied, 28 suppliers carried out carbon footprint veri?cation within Scope 1 and Scope 2, and 16 suppliers veri?edthe carbon data of Scope 3 products. We plan to incorporate the relevant requirements of the non-quality system into the SRMsystem in 2024 to publicize them to our suppliers and guide the suppliers to learn about these requirements.
Dimensions of the Supplier Audit on Environmental and Social Responsibilities
Environmental and Social Responsibility Management
Child laborand minor
Anti-discriminationLodgingsanitation
MoralityandintegrityWorkinghours andsalaries
Forcedlabor
Management oftoxic, ?ammableand explosiveproducts
Free choice ofemployment
Freedom ofassociation
Managementof occupationaldiseases
Safety
EnvironmentalManagement
Advance budget control
Standardize material
master data
Planned requirementsmanagement
Transparent and e?cient
procurement
Central spare partsinventory and allocation
Digitally driven
Post-hocanalysis
No uni?edrules
Unplannedcoordination
O?ine lendingand repaymentDistributed goodspreparation ofthe basesIne?cientsource seeking
Driven byhumanexperience
Beforehandcontrol
Uni?edstandards ofthe Group
Plannedmanagement(Pre-jobmaterial control)
OnlineallocationJointstorage andreserveMall-typeprocurement
Digitallydrivenbusinesscontrol
Fromto
Fromto
Fromto
Fromto
Fromto
Fromto
8180
2023
SocialResponsibilities
Environmental, Social and Governance Report
The Company attaches great importance to improving the suppliers' capabilities and is committed to coordinateddevelopment with suppliers. We maintain close communications and exchanges with our suppliers by holdingsupplier conferences, conducting supplier training, and implementing supplier support projects to achievemutual bene?ts and win-win.
Supplier empowerment
Upholding that "one who is in charge shall be responsible", our Project Department or Procurement Departmentreviews the safety qualification of the contractors, investigates the legality, adaptability, reliability, technicalquali?cation, and safety assurance of the contractors, and submits the results to the O?ce of the Work SafetyLeading Team's Office for filing. Before a contractor's entry, the Company issues theContractor's InternalOperating Safety Instructionsto the contractor and signs theContractor's Safety, Environmental Protection,and Occupational Health Management Agreementwith the contractor to clarify the safety responsibility ofthe contractor for its personnel and projects. To guarantee the project safety, all personnel of the contractorsshall receive safety education and training before their entry, and the Project Department dispatches safetymanagement personnel to supervise daily safety inspections on site. If the contractors violate the safety rules andregulations inside the Company and cause accidents, the accident investigation and handling shall be carried outaccording to our accident investigation procedure.
Contractor management
Case Annual supplier conference
In December 2023, the Company held a supplier conference around the theme of "Deepening Collaboration,Winning the Future with Quality". More than 400 supplier representatives from di?erent parts of the world attendedthe conference to jointly facilitate the sustainable development of the industry. At the meeting, General ManagerLi Nanjing and other leaders presented awards to the suppliers winning the 2023 Gold Strategic Supplier Award,Excellent Supplier Award, Best Growth Award, Excellent Performance Award, Technical Cooperation Award, andCollaborator Award. Besides, General Manager Li Nanjing made a summary of the conference: "Suppliers are ourvital partners. The strengths of the suppliers and the closeness of supplier relationships largely determine our costcompetitiveness and risk resistance. We hope to deepen collaboration with our suppliers and friends, jointly promotebusiness digitalization, and achieve information exchange, mutual promotion, and vertical linkage in terms ofcollaboration. We achieve co-construction, sharing, common growth, and result sharing in terms of resources; ?exiblereliability, cost control, and risk sharing in terms of supply; o?er each other trust and support and complement eachother's strengths in terms of development, to jointly open a new chapter for high-quality development."
Case Supplier support improvement project
In May 2023, the Company found that a certain batch of 150 powder contained iron filings. After spotchecks, considerable iron ?lings were also found in the remaining inventories of 150 powder. We activelycontacted the supplier to return the problematic inventories and asked the supplier to suspend itssupply for rectification. Besides, the Company guided the supplier to analyze the causes according tothe 5M1E method - the most fundamental investigation method. We communicated with the supplier onsite, guided the supplier to focus on the key points, and assisted the supplier in formulating short-termand long-term improvement measures to promote implementation. After the supplier's recti?cation, wepromptly followed up on and evaluated the results. In August, the supplier's normal supply was resumed.As at the end of the reporting period, no similar quality anomaly occurred to the supplier.
Communication with the Supplier on Site
CSRmanagement
EHS
Wastemanagement
SustainabilitymanagementDiverseconstructions andrequirements
Themes of supplier training
Annual Supplier Conference
8382
2023
SocialResponsibilities
Environmental, Social and Governance Report
As a leading enterprise within the industry, the Company always firmly believes in the positive value ofcooperation and sharing for the sustainable development of itself, the industry, and society during innovations.To facilitate the industry win-win, we cooperate with our domestic and overseas associates, and upstream anddownstream enterprises to exchange and learn about new opportunities and achievements in the developmentof the industry. We actively undertake the responsibilities of industry associations, promote the formulation ofindustry standards, carry out in-depth exchanges and scienti?c research project cooperation with universities,and guide the future development trend of the industry with technological innovations.
To promote joint construction and win-win in the industry, we actively participate in exchanges, exhibitions, andother activities related to materials and sustainable development, and realize the coordinated development,mutual bene?t, and win-win of the industry through intuitive and high-quality exchanges.
In January 2023, the Company attended the InternationalForum for the Extended Producer Responsibilities of ChineseManufacturers of Automotive Products and obtained the license
granted by the branch chairman of CAPRO.
The Company's Participation in the 2023 CEORoundtable on Circular Economy of the Chinese Plastics
Industry in May 2023
Joint industry advancement
Facilitation of the Industry Development
Case
Case
Case
Case
The Company sponsored an ESG forum and initiated a brand new mode ofthinking for sustainable development of the plastics value chain.
The Company took part in the International Exhibition on Plastics and RubberIndustries to jointly communicate about and display the green low-carbonsolutions and enter into cooperation contracts with international enterprises.
The National Industrial Innovation Center attended the CMF Forum to shareexperience related to carbon neutrality of organizations and products.
The Company took part in the CMEF Exhibition, to set an example in industryof safety and healthy green products.In June 2023, the "2023 ESG Development Summitof the Plastic Value Chain" hosted by the Companysmoothly came to an end in Shanghai. Li Jianjun, theCompany's chief scientist, released the Company's2022 ESG report on the spot, focusing on theCompany's strategies, performance, and investmentin green and low-carbon cycles. During the forum,the elite representatives from different institutionsand enterprises discussed the current situation andtrends of ESG in the form of keynote speeches, keynotereports, and roundtable discussions, and jointlyexplored the strategy and realization path for thesustainable development of the plastic value chain.
In April 2023, "CHINAPLAS 2023 International Exhibition on Plastics and Rubber Industries" was held inShenzhen. The Company focuses on displaying diversified innovative technologies, green and low-carbonsolutions, and one-stop services. At the exhibition site, the Company also entered into a cooperation agreementwith Tuv Rheinland (Shanghai) Co., Ltd. on the spot, reached an agreement on photovoltaic materials,components, and testing services, and was awarded the Commercial Material Certificate for photovoltaicmaterials by T?V Rheinland, which veri?ed that the products of the Company satis?ed the legal and regulatoryrequirements for corresponding photovoltaic products in terms of performance and safety speci?cations.
In March 2023, the "Bio-based & Environment-friendly Materials and CMFForum" sponsored by the Organizing Committee of the International CMFDesign Conference and Shenzhen Industrial Design Association was heldin Shenzhen. Wu Bo, the general manager of the Company's NationalIndustrial Innovation Center, attended the forum and made a reporton the theme of "Corporate Green Environment-friendly Applications -Policy Guidance on Carbon Footprints", and shared the organizationalcarbon management, product carbon footprints, calculation methods forevaluating indicators of carbon neutralization results and practices.
In May 2023, the opening ceremony of the 87th China International MedicinalEquipment Fairn (CMEF) was held. The Company displayed masks, gloves,surgical gowns, degradable products, disinfection, sterilization, and otherhealth protection products at the exhibition, and conducted in-depthexchanges with the associates and customers, which demonstrated theCompany's remarkable technical strengths and emphasis on customerexperience, as well as the spirit of green environmental protection, thussetting an example for the development of the industry. Roundtable Discussion of the Forum
Exhibition Area of the Company in CHINAPLASConcluding a Cooperation Agreement with T?V Rheinland
Experience Sharing in the
CMF Forum
Display of DegradableProducts at the CMEF
8584
2023
SocialResponsibilitiesEnvironmental, Social and Governance Report
Guidance by high-quality standards is a key factor for innovation and sustainable development of an industry.Since its establishment, the Company has actively formulated relevant national, industry and group standards forpolymers, modi?ed plastics, recycled plastics, and bio-based materials, etc. We have participated in formulating190 standards to promote the sound development of the plastics industry.As the secretariat of the TC48WG4 of the National Plastic Products Standardization Committee, the Companycontinued to deeply participate in the formulation of industry standards during the reporting period, coveringseveral international, national, and social organization standards, all of which were released during the reportingperiod.
Guided by the need for industrial development, theCompany actively promoted deep integration ofindustry, education and research. During the reportingperiod, the Company carried out scientific andtechnological project cooperation with the Hong KongUniversity of Science and Technology (Guangzhou),and performed some in-depth project research withHuazhong University of Science and Technologyto promote the transfer and transformation ofscientific and technological achievements, andthe development of the industry through industry-academia-research-application.
Invited for an Interview in the Cooperation Project withHuazhong University of Science and Technology
Standard Setting
Industry-academia-research cooperation
Case
Case
The Company and Automotive Data of China Co., Ltd. organized a standardseminar to standardize the use of recycled plastics for vehicles.
The Company cooperated with the Hong Kong University of Scienceand Technology, to promote new technologies in the market.
In March 2023, the Company organized a seminar on theSpeci?cation for Use of Recycled Plastics forVehiclesin Shanghai together with Automotive Data of China Co., Ltd., China Society of AutomotiveEngineers and China National Resources Recycling Association. More than 60 expert representatives fromover 30 domestic and foreign- related upstream and downstream enterprises of the automobile industry
The Company carried out scienti?c and technological project cooperation with the Hong Kong Universityof Science and Technology (Guangzhou) to make the technologies market-oriented, and carriedout cooperation on ultra-thin super-strong diaphragms, seawater desalination and photocatalyticdegradation reagent.
Site of the Standard Seminar
Cooperation with the Hong Kong University of Science and Technology
ISO 61:2023 Plastics —Determination of apparent density ofmoulding material that cannot be poured from a speci?ed funnel
GB/T 42922-2023 Plastics -Determination of organic solventextractables
GB/T 43297-2023 Plastics -Methodology for assessing polymerphotoageing - FTIR and UV/visible spectroscopyT/GDPIA 60-2023Bamboo powder based fully biodegradable ?lmspecial material
T/GDPIA 62-2023Bamboo powder based fully biodegradableplastic special materialT/GDPIA 61-2023Bamboo powder based fully biodegradablestraw special material
T/GDPIA 63-2023Bamboo powder based fully biodegradableinjection molding special material
International
standards
Nationalstandards
Groupstandard
The Company's
Participationin FormulatingStandards duringthe Reporting
Period
chain attended the meeting. The Company shared practicalexperience on the key technologies of recycled plasticsand the practical application of automotive products,and had a heated discussion with the experts presenton key issues such as the terminology and definitions oftechnical standards, certification methods, supply chainmanagement, and technical parameters. Many valuableopinions and suggestions were provided by the Company incombination with the situation of itself and the industry.
8786
2023
SocialResponsibilities
Environmental, Social and Governance Report
Being "people-oriented", the Company attaches great importance to the rights and interests of all employees,actively advocates and builds a diverse and inclusive corporate culture, provides all-round support for all-rounddevelopment of the employees, and empowers the employees.During the reporting period, the Company strengthened the human resource management and accuratelycontrolled the human resources sta?ng, in order to steadily improve the e?ciency per capita. In addition, theCompany closely follows up on the business strategies and constantly explores the recruitment and trainingmechanisms of international talents, which further promotes its development.
The Company actively develops and adheres to diverse and inclusive cultural concepts,pays special attention to the protection and improvement of the female employees'rights and interests, and emphasizes equality between men and women and equal payfor equal work. For this purpose, we have specially formulated theRegulations on LaborProtection and Management of Female Employees. These regulations aim to ensure thatthe female employees' rights and interests are fully protected at work, and prevent anyform of infringement and discrimination. The Company has built a committee for femaleemployees to protect the legitimate rights and special interests of the female employeesin accordance with the law, including loving cabins for mothers and green channels forpregnant women to dine. We consistently uphold equality and impartiality, to create a safe,healthy and equal work environment for female employees.
Recruit the female employeesaccording to labor protectionpolicies and requirements;The female employees are entitledto the equal pay for equal work asthe male employees in their posts;Maintain equality between themen and women in terms of jobpromotion, promotion, evaluationof professional titles, positions andtraining, and never discriminateagainst the female employees.Never restrict the femaleemployees to participate in theaforementioned activities becauseof their pregnancy, childbirth orbreast-feeding.
Gradually improve the sanitaryconditions for the femaleemployees, and regularlyorganize professional institutionsto assist with the femaleemployees' health preservation;Install water heaters and showersin the dormitories for femaleemployees;Organize regular physicalexaminations and gynecologicalexaminations for all femaleemployees to ensure their health.
Purchase maternity insurancefor all female employees inaccordance with relevantnational regulations;Provide female employees withpregnancy leave and monthlyliving expenses during theirpregnancy leave;In the event of childbirth(or miscarriage), the femaleemployees are entitled to thematernity insurance bene?tsfrom a social insurance agencyaccording to relevant regulations;After maternity leave, providethe female employees withbreastfeeding leave until theirchildren reach by six months, andmonthly living expenses.
Healthpreservationof the femaleemployees
Loving Cabin for MothersGreen Channel for the
Pregnant Women to Dine
Labor Protection Measures for the Female Employees
Labor Protection for Female EmployeesEquality, Inclusion, and Diversity
During the reporting period
As of the end of thereporting period
the female employeesaccounted for
% of
14.6
10.4
the Company had a total of
10,629employeesThe labor contractswere concludedwith all employees
disabled employees werecumulatively recruited
retired soldiers werecumulatively employed
The social securitycovered all employeesAll employeesreturned to work aftertheir parental leave
Recruitfemaleemployees
the Company's middlemanagement and
% of the topmanagement.
Protectionof femaleemployees
8988
2023
SocialResponsibilities
Environmental, Social and Governance Report
The Company upholds equality and inclusion, and resolutely opposes any form of discrimination. We arecommitted to building a diversi?ed and harmonious workplace environment to ensure that all employees arerespected and accepted. We strictly abide by laws and regulations. We have formulated theAnti-Discriminationand Anti-Harassment Management Regulations, which are not affected by factors such as gender, age, race,ethnicity or region. We supervise all our departments, prevent and prohibit discrimination or harassment, andresolutely eradicate discrimination.The Company continuously carries out publicity and education activities to prevent and stop workplaceharassment. We post rules and regulations in conspicuous places such as corporate and o?ce bulletin boards. Todeal with discrimination and harassment in time, the Company provides the employees with internal complaintchannels to create a fair and fair working environment. In the event of discrimination, the Company promptlycommunicates with the injured employees promptly to appease them, and holds those who have discriminatedagainst the employees accountable for punishment.
Adhering to the spirit of the International Labor Organization's conventions, the Company is committed tocontinuously improving the internal management system to ensure its compliance and ethical management. Wehave formulated internal management systems such as theRegulations on the Management of Child Labor andMinor Workerswhich clearly stipulate the guidelines for prohibiting forced labor and child labor. The Companyresolutely puts an end to any violations of human rights such as child labor and minor workers. During theirrecruitment, the Company's recruit personnel strictly check the job applicants' identity documents to identifytheir true age and the authenticity of their identity documents. The Company promises not to accept any supplieror partner who employs child labor or minor workers.
Anti-discrimination and Complaint Handling Procedures
Remedial Procedures for Inadvertent Child Labor
Anti-discrimination
Management of Child Labor and Minor Workers
The Company upholds impartiality and equality during its recruitment. We prohibit attracting people byany forced or deceptive means, and resolutely eliminate any form of forced labor. We have formulated theManagement Regulations on the Prohibition of Forced Labor.During the term of their contracts, the employeesare entitled to rest, take holidays and terminate their employment in accordance with the law. The Company shallnot illegally restrict the such rights of the employees. We are committed to promoting the concept of protectionof human rights and anti-forced labor to our suppliers, contractors and partners, in order to jointly create aharmonious and fair business environment.If we discover forced labor, our HR Department and Trade Union will communicate with and comfort theemployees in a timely manner, and take corresponding measures to remedy the situation. During the newemployee orientation training, all our new employees are trained and publicized. Our employees are informedthat if the above problems occur, they shall complain to the Company through our suggestion box, mailbox,reporting hotlines or OA system, etc.
Prohibition of Forced Labor
If an employee is diagnosedwith disease, treatment shall bearranged until recovery, and allmedical expenses shall be borneby the Company. After solicitingthe opinions from the child laborer,send someone to escort him backto his original place of residence,and ask his parents or otherguardians to sign for receipt. Allexpenses incurred by such escortshall be borne by the Company.
Mobilize the families of childlaborers to arrange further studyfor the laborers before they areallowed to participate in socialwork, and provide financialassistance for them. All records onthe child laborers shall be kept bythe HR Department for inquiry.
Any personnel or departmenthead of the Company shallimmediately report to the HRDepartment.
Don't dismiss the child laborimmediately, to prevent themfrom being put in a more di?cultdilemma;Take appropriate remedialmeasures and report to a locallabor bureau immediately.Meanwhile, arrange healthexaminations.
Event reporting
0304
Complain about related situation through the suggestion box, internalmailbox or OA system of the Company, or by directly contacting relatedpersons in charge by phone.
The management of theCompany will appointspecial personnel toinvestigate the complaintin detail, and reply to thecomplainant within 15 days.
Once a complaint is foundtrue after investigation, theperson against whom thecomplaint is filed will bepunished.
Compensation for child laborSubsequent follow-up
Response Measure
9190
2023
SocialResponsibilitiesEnvironmental, Social and Governance Report
The Company is committed to safeguarding the legitimate rights and interests of the employees, building a diverse andinclusive corporate atmosphere, and e?ectively implementing various welfare and care measures to increase all employees'sense of happiness and belonging, and ensure that the employees may feel warmth and respect in the Company.
Employee rights
As of the end of the reporting perioda total of3,568
people participated in the evaluation of professional and technical
Honors of the employer brands
The Most Attractive Employerof the Workplace in 2023
Commun-icationchannels
China Preferred Employer of
the Year 2023
The Most Preferred Employer
of the Year 2023Awarded by: China BusinessJournal & Career International
Grassroots shift meetings, weekly,semi-annual and annual meetingsQuestionnaireOnline forumDiverse Communication Channels
Awarded by: Zhilian ZhaopinAwarded by: Interns
As a core element of e?cient team operation, communication has irreplaceable value formaintaining team stability and improving overall performance. Consistently upholding"following the procedures, revering the superior, respecting the subordinate, and beingsincere and proactive", the Company is committed to constructing a comprehensive andefficient communication system. By creating diversified communication channels, wecan not only keep abreast of our employees' needs and feedback, but also effectivelystimulate our employees' enthusiasm for participating in our decision-making and culturalconstruction, thereby promoting the continuous development of our team.
To further strengthen the democratic communication channels, the trade union of the Company has built a management platformfor managing the employees' appeals, e?ciently responded to the reasonable needs and opinions put forward by the employeesfor their interests and the development of the Company, improved the employee satisfaction through employee support andconcern, and jointly established harmonious labor relations. The Company organizes the meetings for the trade union's memberrepresentatives and the employee representatives. We enter into theCollective Contractwith the employee representativesto improve the mechanism for employees to offer advice and suggestions to the Company, and to protect their rights to know,participate, express, and supervise.
Democratic Communication
As of the end of thereporting periodThe Company had cumulativelycollected more than onethousand reasonablesuggestions from theemployees. The rate of responseto the employee suggestions is
%. These
Case
The employee engagement survey suggested that the overall engagement wascomparable to that of the previous yearDuring the reporting period, the Company's employee engagement survey suggested that a total of 4,135 questionnaireswere valid, covering multiple business segments and employee categories. The results showed that the overall engagementwas similar to that of the previous year. The employees highly recognized their personal engagement, leadershipe?ectiveness and cultural vision. They regarded the work environment and resources as common factors they were moresatis?ed with. In addition, after investigation, it was found that there were some common dimensions of dissatisfaction ineach business segment of the Company, including work-life balance and career development. For instance, the Companypays close attention and proposes improvement measures. For example, we have established a comprehensive dual-channel mechanism for career development to provide our employees with a de?nite promotion path.
Excerpt of Overall Scoring Result on Employee Engagement (Full Score: 6)
Dimensions of engagementScore
Leadership e?ectiveness5.28Personal engagement5.19
Cultural vision5.17
quali?cations. Among them, professional engineers were rated as intermediate engineers,and of them were evaluated as senior engineers (experts). All of whom were entitled to theCompany's housing bene?ts, encouraging employees to continue to develop their own expertise. Whilemaking substantial progress in their professional expertise, they were also recognized by the Company.
suggestions are helpful for usto optimize our managementstrategies and improve ourperformance.
9392
2023
SocialResponsibilities
Environmental, Social and Governance Report
The Company adopts a salary structure that integrates the base salary with variable pay, to establish a salary incentivesystem for the employees that not only reflects internal fairness, but also demonstrates external competitiveness. Thecompensation consists of base salary, performance bonus, rewards and various allowances, which are regularly accountedby the HR Department of the Company. The employees may inquire about and calculate the salary paid through the onlineplatform. We encrypt and manage the sensitive information, which shall not be disclosed.The Company proposes and continues to practice the unique "cake theory". It is better to ask for a small piece of a big cakeinstead of the entire one. This theory has evolved into the core idea and excellent tradition of the Company's incentivemechanism. The Company rewards the shares to the key employees, making them become the real masters of theCompany. Internally, the Company has put forward an assessment and incentive plan for the post target responsibilitysystem. Based on our own development experience and the core concept of taking the market as the core leadingtechnology and management as the guarantee, our overall goals, general tasks, time limits for completion, and scienti?crules on the results to be achieved are strategically decoded and decomposed step by step in respect of each key position,in order to guide and encourage all undertakers who perform tasks to work together along the same direction as the overallgoals, optimize the bene?ts and practice the core values of "being oriented towards the value creators".
Being always professional and meticulous in the construction of an employee welfare system, we are committedto providing all-round and multi-level welfare guarantees for our employees. During the reporting period, theCompany updated the welfare system for the retired employees to better help the employees ease their worriesafter retirement.
Construction of "Kingfa Homeland Culture"
Employee Compensation
Employee welfare
Party-massIntegratedService Center
Activity venue of3,000㎡
Diverseintensiveservices
10 interestclubsWelfare andcare system
Case Equity Incentive Planc
The Company has implemented the employee stock ownership plan since 2016, drawn up the2022Restricted Stock Incentive Plan (Draft)in 2022, and continued to promote the incentive plan duringthe reporting period. In June 2023, we granted 692 employees some reserved restricted stocks, andintended to reward our core technical, marketing and management personnel with our net pro?t andoperating income as in our annual performance appraisal. The establishment and implementation ofthe personalized incentive mechanism and a series of supporting measures have attracted numerousoutstanding talents, stimulated their passion and aspiration for the Company's development, andinjected everlasting vitality into the Company's development.
KPT - key performance target
It comprises of an e?ciencyindicator X and a statusindicator Y. From theperspective of marketingand technologies, it may bedecomposed into the mostgrassroots business units ortechnology units.
KPI - key performance indicator
Post targetaccountability systemBe goal-oriented andresolutely achievemissions
KPP - key project platformThe improvement of theoriginal key performanceindicators is an importantsupplementary index forassessing KPT.
Pay attention to the
construction of major
projects and long-term
platforms.
Components of the Post Target Responsibility System
Construct a management system of "three indicators, three standards and threepractices", and each functional module corresponds to the decomposed targets.Vertically conduct performance appraisal for the cadres, and horizontally matchemployee value and position value on a ?ow basis.
Kingfa homeland:
Consolidate thefoundation of the
"home"Re?ect the warmth ofthe "home"Cohere the strength of"the home"
9594
2023
SocialResponsibilities
Environmental, Social and Governance Report
During the reporting periodthe Company organized the 30
th anniversary, and distributed welfare of RMBemployees. The total amount of bene?ts for the Spring Festival, Women's Day,
million to13,694
7.8
13.4
Upgraded the skills training
rooms and lounges forfrontline employees
Set up an in?rmary of the Company
Set up childcare classes for the
employees' children
Arranged special school buses,commuting and shopping buses
Employee Bene?t Measures during the
Reporting Period
Employee Welfare and Care System
Paying attention to the femaleemployees' rights and interests,the Company has formulatedtheRegulations on LaborProtection and Managementof Female Employees.Wehave set up nursery roomsand green channels for thepregnant women to dine,and implemented othermeasures to care for the femaleemployees.
Rights and interestsof the femaleemployees
The Company provides theemployees with canteendining services, multi-room welfare dormitories,equipped with completeinfrastructure and diversecultural and recreationalactivity venues.
Supporting living andrecreational facilities
The Company provides theemployees with annual andquarterly bene?ts, tra?csubsidies, seniority subsidies,other bene?ts and subsidies.
Bene?ts andsubsidies
The Company has set up anin?rmary to provide basichealth diagnosis, treatmentand psychological counselingservices for the employees.We annually arrange freephysical examinations for ouremployees.
Medical health
The Company provides theemployees with paid training,learning and improvementsubsidies.
Improvement ofacademic quali?cationand training
We attach great importanceto the lives and families ofour employees in need. Wehave set up a special fundto support the employees inneed, and apply for supportfunds for our employees whocan hardly obtain loans orsuffer from critical diseases orwhose families face difficultiesin applying for loans.
Support fordi?culties
The Company implementsa ?ve-day work week, andthe employees are entitledto holidays such asmaternity leave, marriageleave, funeral leave andannual leave according tothe law.
Holiday care
The Company encouragesthe employees to bringtheir children and otherimmediate family membersto live with them. Besides,we provide childcare,schooling and shuttleservices for our employees'children. We haveintroduced a kindergarten,and made special schoolbus services available.
Family care
The Company buys"endowment insurance,medical insurance, maternityinsurance, unemploymentinsurance, work-relatedinjury insurance and housingprovident fund" for allemployees.
Five social insurance andone housing fund
The Company provides theemployees with birthday gifts,and distributes condolencemoney or condolences to theemployees every year duringthe Spring Festival,Mid-Autumn Festival, anniversaryand other festivals, andorganizes diverse recreationalactivities during holidays.
Holiday bene?ts
Dispatch bene?tsThe Company providesthe employees with freeshopping buses, shuttlebuses for commuting, andwelfare vehicles.
Convenienttransportation
Upgraded sta? dormitories
The Company provides
overseas subsidies, overseas
foreign language subsidies,
family visit holidays, overseas
insurance and other bene?ts
for the overseas employees.
and Mid-Autumn Festival was RMBmillion.
9796
2023
SocialResponsibilitiesEnvironmental, Social and Governance Report
The Company has long been committed to optimizing the employees' spiritual and cultural life. Upholdingpopular, small-scale and routine activities, we make innovations of our recreational and sports activities in formand substance according to local conditions. During the reporting period, we organized more than 500 activities toenrich our employees' amateur life, increase our employees' enthusiasm for work, and create team spirit.
Around the "1438" strategic goal for 2030 and based on the needs of the business units, the Company has integrated thetalent strategies from the perspective of marketing, technologies, domestic and overseas operations. We have set theemployee development vision of "attracting global outstanding talents, activating individuals, improving organizationalcapabilities, becoming a world-renowned employer brand, and guaranteeing our realization of the "1438" strategic goalby providing a high-quality talent supply chain". The Company is committed to ful?lling the core tasks for increasing itstalent adequacy ratio, organizational e?ciency and organizational ?t, to guarantee the talents' career development.
Employee Activities
Employees' Career Development
Case
"New Leap · Vigorous Development" Kingfa 30th Anniversary Celebration:
Starting a New Journey to Sustainable and High-quality Development
Level of talent competencyPersonal empowermentInternal empowermentWorldwide development
In November 2023, the Company ushered in its 30th anniversary celebration, which was grandly heldat Qingyuan Sports Center, Guangdong Province. The celebration party was wonderful, showing theCompany's innovations and progress in the past 30 years, and eulogizing that under the leadership
The 30th Anniversary Celebration of the Company
Talent Competency Model
The Company makes continuous innovation and improvement of the talent development system to providethe employees with a broad career development platform. The Company has built a talent competency model,developed and improved di?erent employee training management methods, improved the training faculty pooland developed training courses. We continuously expand and develop internal training resources, effectivelyimprove the professional quality and job skills of our employees, and foster professional forces.
Employee development and training
Corecompetencies
Topleadership
Middleleadership
Bottomleadership
Continuous innovations;loyalty to the organization
Collaboration andcooperation; e?cientoperations
Customers first;striving spirit
Senior management style
Strive for excellence
Professional in?uence
Strategic thinkingResolute decision-making
Strategic integrationOperational awareness
Team managementProblem analysisand solvingIntrinsic motivationResilient growthEQ
Empower the teamsManage target plansDrive execution
Inspire othersShape organizationalcapabilitiesLead transformation
of the chairman, the Company was moving towards a newera of sustainable and high-quality development, andadvancing toward the goal of one hundred billion. This activityinspired the employees to continue to uphold the concept ofmaking technological innovations and serving the countrythrough industry in the next 30 years, and contribute to thetechnological revitalization of the motherland.
In April 2023, the Company organized
an outdoor hike.
In October 2023, the Company held afun sports meet, and more than 300employees took part in the sports meet.
In September 2023, the Companyorganized a 5V5 basketball match.
In October 2023, the Companyorganized the Second "Kingfa Cup"
Football Match.
In April 2023, the Company organizeda badminton fellowship tournament
with a daily chemical enterprise
9998
2023
SocialResponsibilities
Environmental, Social and Governance Report
Pr
o
f
e
s
s
ion
a
l
c
h
a
nn
el
s
M
a
n
a
ge
m
e
n
t
c
h
annels
Upholding "attaching equal importance to integrity and talent and employing one's talent to the fullest extent", wehighly value our employees' career development. To this end, the Company provides diversi?ed career developmentopportunities, including a dual-track career path and a job rotation mechanism, to expand the career growth spacefor our employees. In the dual-track career path, we have established two different development channels formanagement and expertise. Our employees may choose the most suitable career development paths according totheir professional skills and personal hobbies. The Company has formulated di?erentiated and reasonable careerpromotion standards based on the competency model and job quali?cation requirements.
Assistant EngineerAssistant Engineer
SupervisorsIntermediate engineer
EngineerEngineer
ManagersSenior EngineerLeadersExpert
Dual-track Path
The Company is committed to improving the employees' skills and knowledge through continuous internal andexternal training, ranging from the EYAS Program for fresh graduates to the "creation-specific" echelon talenttraining program for the technical system, to provide tailor-made training opportunities for the employees atdi?erent stages to achieve self-enhancement.
Organization of Employee Training
During the reporting period
During the reporting period
to encourage theemployees to improve theiracademic quali?cation andenhance their professionalknowledge.
the Company subsidized theemployees' improvement of theiracademic education and furtherstudy in institutions of higherlearning with a total of RMB
1.075
million
the Company created
series of job traininga total of our
10,658employees were trained
70.73
% as compared
representing an increase of
22.7
% as compared
each employee received training of
41.3
hours on average
compiled learning maps for
development channels
and produced
courses
of which RMB
304,700
the total training hours receivedby the employees were
440,232.29
with an increase of
Kingfa e-Enterprise Learning
The Company has built "Kingfa GlobalInnovation Training DevelopmentCenter" and "Kingfa e-EnterpriseLearning" as employee growthplatforms. Internally, we organize"online plus offline" training andlearning. Kingfa Management Schoolhas created an all-round trainingand development system for theemployees, to help them growthrough a series of talent trainingprojects, E-learning platforms, on-the-job education and job rotation, etc.
Level 5
Level 3
Level
Level 2Level 1
was for improving theiracademic education
with the previous year
with the previous year
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On the basis of ensuring regular training, the Company focuses on implementing 5 management talent trainingplans and 3 professional talent training projects, thus forming a strategic talent echelon training system. We conductcustomized training for marketing, technical, and operating personnel, and regularly organize training to empowerour employees, facilitate their better development, and lay a solid foundation for our long-term success. During thereporting period, the Company trained 6 recipients of State Council subsidies, 146 senior engineers and 1 academician.
Young eagleYoung eagleFresh technical graduates
product developmentexecutives of theTechnology Center
sword forging?ying eaglesword sharpeningeaglesword showingTOP program
Internally, the Company cultivates and seeks lecturers. We are slack in admission and strict in evaluation when selectingand certifying our internal lecturers. Any employee who meets our internal competency requirements may apply to theHR Department for teaching training courses developed by himself or others. The HR Department annually organizesseveral certi?cation training courses for junior, intermediate and senior lecturers, and conducts on-site evaluation of thetrainees after their enrollment in the training and completion of the major courses at the corresponding levels.Internal directors of theCompany and those with highertitles/external lecturers of theCompany, and lecturers from theinstitutions of higher learning
Skilled at course developmentand design, they are able toindependently develop 1 o?inecourse, and have passed theexamination; have developed 2Microlectures/SOPs
They have not taken part in theinternal lecturer examination,but are experienced in givinglectures inside the Company,or have failed the examinationfor junior lecturers
Skilled at scheme design andorganization, they are able toindependently guide meetingdesign and organization.
Skilled at teaching, they areable to independently teach1 to 2 courses. With goodskills in speech and crowdcontrol, they are capable ofdeveloping 2 cases and havepassed the examination.
Guest lecturersIntermediate lecturers Temporary lecturers
Senior lecturers/facilitatorsJunior lecturers
Training System for Talent Development
Capability Requirements for Internal Lecturers
0102030405
Level of talentcompetency
Senior leadership
Grassrootsleadership
Middle leadership
Marketing system (sword series)
Cultivate managers for the three-in-onemodules
Positioning for sword showing
cultivate excellent salespersons for themarkets at home and abroadPositioning for sword sharpening
Cultivate salespersons with businessknowledge and powerful sales capabilities
Positioning for sword forging
Integration into the organization, andknowledge about the products and theorganizational systemPositioning for young eagles
Aimed to make the traineescompetent for basic R&D
Creative thinking class
Aimed to cultivate the employeesto be competent for productdevelopmentMake the trainees competent foroverseas work environment inaddition to product development
Creation class
Overseas creation class
strategies, organizationconstruction, senior leadership,and capabilities necessary forother strategies
Learning themes of the TOP program
leadership, improvement ofmanagement skills, coachingskills, and procedure optimization
Eagle-speci?c
Outstanding individuals,communications, andimprovement of grassrootscommunication skills
Flying eagle-speci?c
Enterprise cultures and productknowledge
Young eagle-speci?c
The training is aimed at makingthe trainees competent forjobs in product planning andmanagement innovation.
Genesis class
Operation System (Eagle Series)Technical system
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CaseEmployee training
To train/reserve talents, construct talent echelons,and help new potential talents improve theirprofessionalism and accelerate their developmentof professional capabilities, in December 2023, theCompany initiated an internal training programfor the new fresh graduates who had just enteredthe Company - spark plan, and trained them atthe ?rst stage.
The "sword sharpening plan" Phase IV, as animportant strategic measure of the Companyunder the macroscopic background of itscomplete internationalization and one of thecore projects for building talent echelons ofthe Marketing Center, helps carry forward theentrepreneurial spirit, giving play to platformadvantages, and realizing leapfrog development.
"Spark Plan" for the Fresh Graduates
Fifth Centralized Training of the Sword Sharpening
Plan Phase IV in Central China Base
"Eagle Plan · Potential Talent Program" cultivatesthe high-potential reserve management talents ofdirectors and the management cadres who havebeen promoted into directors in the past two yearsin a targeted manner. Through the early surveys,this program cultivates, evaluates and selectstalents by extracting experience from outstandingorganizations through training missions. The keytraining content of this project includes profoundunderstanding of the chairman's thoughts,improvement of middle leadership, cultivation ofexcellent operation capabilities, and expansion ofmanagement insights. Such full coverage is aimedto improve the cadres' competencies from di?erentperspectives, for the purpose of realizing leapfrogdevelopment to a greater extent.
To promote the Company's digitalization and ensure that the Company's core managementcadres have a uni?ed understanding of digitalization, support our digitalization strategies, andeffectively promote the relevant deployment of digitalization, in December 2023, we invitedexperts from a third-party organization to teach all our middle and senior management cadres inrespect ofEnterprise Digitalization.
The High-potential Talent Class of the Eagle Plan
Visited CSOT
The Company's Initiation of Trainingby the General Managers
External Lecturers' Explanations to the Trainees
Spark plan
Sword sharpening plan
Eagle plan
Training onEnterprise Digitalization
International talent training program
In response to the overseas strategic goalof "deeply embarking on businesses in AsiaPacific and developing the businesses inEurope and the United States", we haveactively established an overseas talent supplychain system, adopted a two-pronged strategyfor "going out and bringing in" to continuouslyaccelerate the cultivation of internationaltalents and build an international talentechelon with global visions, cross-culturalcommunication capabilities, and professionalskills. In 2023, we carried out an internationaltraining program with four special projects andeight subdivided fields, covering outstandingtalents at home and abroad engaged in thefield of marketing, technologies, and internalfunctions. We approximately cultivated 270internationalized talents and developed about67 internationalized courses.
As a general manager of the Company,Professor Li Nanjing taught the course known asInternationalization Strategies and Foreign Planningof the Company, and took a joint photo with themembers of Soaring Falcon abroad.
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The Company complies with theLaw of the People's Republic of Chinaon the Prevention and Control of Occupational Diseases, other relevantlaws and regulations. We prepare and strictly implement occupationalhealth protection system documents, including theRegulations on theManagement of Occupational Health, Safety and Environmental Protection
to protect our employees' safety and health in the production process, ande?ectively prevent them from su?ering occupational diseases.
Occupational health protection
Our occupational health and safety work has always been carried out based on the concept that "safety is essentialfor survival" and the policy that "production and life safety is the top priority". All our subsidiaries shall take suchconcepts and policies as prerequisites for carrying out work and actively publicize and implement them to increaseour employees' safety awareness and create a safe, healthy work environment. The new construction, reconstruction, and expansion projects, as well as the three simultaneous for the environment-friendliness of the Company, its bases, branches, and subsidiaries, must meet the national requirements foroccupational health, safety facilities, and ?re?ghting facilities. It must be ensured that they are designed, constructed,and put into use at the same time as the main projects, to ensure that the construction projects conform to theoccupational health and safety, ?re, and environmental protection standards stipulated by the state after they are putinto operation upon completion, and ensure the employees' safety and health in the production process. During thereporting period, the Company and its 11 subsidiaries or production bases passed the ISO 45001 Occupational Healthand Safety Management System Certi?cation.
Occupational health and safety
During the reporting period
4.665
million inwe invested RMB
% of our
We care about and attach importance to all our employee's physical and mental health. In terms of occupationalhealth, when entering into labor contracts with employees in positions exposed to occupational hazards, wetruthfully inform our employees of the hazards they might be exposed to during work, and their consequences,measures for protecting against occupational diseases, and bene?ts. Without concealing the risks of any positions,we enter into a contract on notifying hazards of occupational diseases with our employees.The Company selects an occupational health examination institution after comprehensive consideration of itshospital qualification, quality of medical services, experience in occupational health examination, facilities,internal and external environment. We organize pre-job, on-the-job and post-employment physical examinationsfor occupational diseases according to our production characteristics and the occupational hazards existing in thepositions of employees in with reference to the national occupational health monitoring standards. Besides, wecontinuously observe and manage our employees' physical examination results.
The Company pays attention to the employees' occupational health and safety, carries out pre-job and on-the-joboccupational health training for them, popularizes knowledge about occupational health, and urges the employeesto abide by laws, regulations, rules, national occupational health standards and operating procedures for preventionand control of occupational diseases. For the employees in positions exposed to serious occupational hazards, specialoccupational health training will be carried out, and the employees will be allowed to perform operations in theirposts only after they have passed the training. The Company has posted occupational hazard noti?cation cards andset up bulletin boards in all workplaces to inform the employees of occupational hazards in the workplaces, preventiveand control actions and systems. Each base, branch and subsidiary regularly monitor the occupational hazards inthe workplaces, and announce the test results to the employees. The Company provides su?cient and conformingpersonal protective equipment for all employees exposed to occupational hazards.
Arrange occupational healthexaminations for the employeeswho are about to go on duty(including those subject to jobtransfer) concerning the potential
hazards they might be exposedto in their posts according to the
post characteristics.
Arrange health examinationsfor the employees before theyare transferred away from orget away from the operations
exposed to occupationalhazards, or in front of their
posts, to con?rm theirhealth status when they aresuspended from exposure to
occupational hazards.
Annually arrangeoccupational healthexaminations for theemployees according tonational regulations regularly.
In case of any unexpectedemergency that endangers theemployees' health, immediately
organize health examinationsfor the employees working inthe same workplace, analyze the
cause of the accident, draw upsolutions and a solidi?cation plan,and reinforce occupational health
and safety management.
Pre-jobAt the time of leave On-the-job EmergencyCategories of Occupational Health Examinations
"Three-simultaneity" System for Occupational Health and Safety Facilities
Pre-assessmentof occupational
hazardsSafety pre-assessment
Design of facilities for
protecting againstoccupational diseases
Design of safetyfacilities
E?ectiveness evaluation
of control overoccupational hazardsSafety assessment upon
completion
010203
Management Measures for Prevention and Control of Occupational DiseasesSet up an occupational health management organization withoccupational health management personnel to be responsiblefor the prevention and control of occupational diseases.Establish and improve the systems for monitoring and evaluatingoccupational hazards in the workplace.Draw up plans for prevention and control of occupationaldiseases and implementation plans.Draft and improve the emergency rescue plans for occupationalhazards and accidents.
Formulate and improve occupational health managementsystems and operating rules.Create and improve ?les on occupational health and laborers'health monitoring.Provide the employees exposed to occupational hazards withpersonal protective equipment up to the national standards.Set up corresponding warning signs and occupational healthbulletin boards in THE workplaces that produce or haveoccupational disease hazards.employees were covered byphysical examinations.
our employees' occupationalhealth and safety
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The Company regulates the management of infectious diseases, publicizes the basic knowledge about infectiousdiseases, increases the employees' awareness of self-health care and disease prevention, prevents, controls andeliminates the occurrence and prevalence of infectious diseases in the Company, and protects the employees'health. When suspicious symptoms of the infectious diseases or related patients are found, the Company willtake necessary protective measures, immediately isolate and send them to hospitals for diagnosis and treatment,discover and manage the sources of infection in time, cut off the channels of transmission, and avoid cross-infection. The company performs chemical disinfection, and prepares standardized operation tables for commondisinfection of daily necessities to guide the actual disinfection work and reduce the spread of infectious viruses.Case
Case
Heatstroke prevention and cooling activities
Publicity Week of theLaw on the Prevention and Treatment of Occupational Diseases
From June 2023 to September 2023, the Qingyuan Base of the Company organized the departments to carry outthe work for heatstroke prevention in the high-temperature season. The Company fully upgraded the hardwarefacilities for heatstroke prevention in each workshop, equipped the rest areas with air conditioners, andmaintained existing fans and other equipment to ensure a pleasant indoor temperature. Besides, we vigorouslypromoted the knowledge about heatstroke prevention, organized special knowledge training on heatstrokeprevention for our employees, and performed high-temperature emergency drills, to comprehensivelyimprove their competencies for dealing with high temperatures. We also invited professional doctors to carryout certification training for first responders of workshops. The training coverage rate reached 95%, and 55employees obtained the certi?cates for the ?rst responders. In addition, the Company adjusted the workinghours during the high-temperature season, and appropriately shortened the working hours during the high-temperature period at noon to ensure that employees had su?cient rest time. We also distributed heatstrokeprevention and cooling supplies, including cooling oil, sunscreen, and drinking water. We also improved ouremployees' work in all aspects of our management mode, including hardware, employees' qualities and skills,and emergency response to protect their health.
Lea?ets on the Workshop Employees' Learningabout the Law on thePrevention and Control ofOccupational Diseases
The Company insists on prevention ?rst, ensures the employees' personal safety, regards "zero accident" as the highestsafety goal by taking the compliance with national laws and regulations as the fundamental requirement. We control risksthrough our management system and management of the leading work safety team, perform supervision and evaluation viathe safety assessment system. We have established a perfect work safety management system. We facilitate improvement ofour safety work and guarantee our smooth production management by improving our system construction, strengtheningour process management, performing our main responsibilities, and conducting regular evaluations.
Investments in work
safety (RMB'0000)
Number of general worksafety accidentsNumber of major worksafety accidents
We adopt a group control system for our overall safety work. Led by the group's leading work safety team, ourbases, branches, and subsidiaries autonomously schedule and finish their respective safety work based onpertinent national laws, regulations, technical safety speci?cations, and standards, as well as related documentsand their respective management standards step by step. We have created a streamlined safety network at threelevels, namely "the Company - departments - shift teams". We summarize our work safety experience, participate inaccident investigations, impel implementation of improvement measures, regularly hold meetings for the leadingwork safety team, enhance all our employees' technical competencies, and increase their safety awareness.
Protection of work safety
20212021
5,698.1
20222022
7,827.92
20232023
6,363.64
To promote the performance of the main responsibility for work safety, implement the work safety responsibilitysystem and the working principle that "one who is in charge shall be responsible", the Company conductsperformance appraisal, and the leading work safety team annually executes the indicators of each departmentand each subsidiary as suggested by its leaders, and incorporates them into the responsibility documents forassessment. The indicators of each department of a subsidiary are decomposed and assessed by the leading worksafety team of the subsidiary according to the indicators of the person in charge of the subsidiary.
As the primary person responsible for the Company's work safety, the generalmanager assumes full responsibilities for the Company's work safety.
The safety supervision and management decision-making body underthe leadership of the general manager is responsible for overall planning,coordination and resolution of major safety and environmental issues.The managers are comprehensively supervised.
Leader/deputy leader of the leading work safety team
Members of the leading work safety team
Architecture of the Company's Leading Work Safety Team
202120222023
During the reporting period, Specialty Engineering Plastics Company organized the publicity week oftheLaw on the Prevention and Control of Occupational Diseases, popularized knowledge, laws, andregulations about the prevention and control of occupational diseases to the employees in variousforms such as regular workshop meetings, education, training, banner publicity, poster posting, lea?etdistribution, and video publicity. A total of 7 bannersand 4 promotional posters were posted. 210 leafletswere distributed and 3 occupational health videoswere repeatedly played on the display screen. Eachworkshop organized one training session aboutoccupational health and protection. The series ofactivities increased the employees' awareness raisedtheir concern about the prevention and control ofoccupational diseases, and enhanced their legalawareness and self-protection ability. Continuouse?orts were made to protect the laborers' health.
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The Company implements a full coverage system for safety education. All employees must receive systematic safetyeducation and training when they go on duty, on their jobs, and are promoted. We require our employees to strictlycomply with all our rules, avoid violations, minimize accidents, and increase their awareness of safe work.The new employees must pass the orientation training and assessment on safety, and the incumbent employeesmust receive safety re-education every year. The management supervisors, and professional and technicalengineers must receive safety training before their promotion and may be promoted or appointed only after passingthe assessment.
Safety training and drills
Content of Safety Training
CaseEmergency drill of Ningbo Kingfa
In 2023, the site emergency response drills were performed under regular and normalized models fordi?erent departments of Ningbo Kingfa. A total of 33 drills were organized according to the annual planthroughout the year, including 20 on-site drills on the emergency response plan, 12 special drills on theemergency response plan, and 1 drill on the comprehensive emergency response plan. Each departmentorganized more than 120 drills for the shift teams according to its internal drill plan.
Emergency Drill of Ningbo Kingfa
Work safety laws andregulations, as wellas relevant standardsapplicable to the Company
Previous accident cases of the Companyand those related to the appointment forthis post; procedures and requirements for
handling the emergencies.
The evaluation is performedafter the training, and aclosed-book examination isarranged. The exam paperconsists of choice questionsand short answer questions orcase analysis. The minimumpassing score is 80.
Safety procedures and requirementsof the Company, including worksafety prohibitions
Discuss the hazards existingin the areas of new postswhere appointment remainsto be performed or that thepersonnel to be appointed forthese posts will be exposed,and some major controls
Contentof SafetyTraining
Employee coverage of
safety drills (%)
Number of work safetyinspections
83.5
96.3936
98.5
Number of trainingsessions on work safety
Number of trainees in thetraining on work safety
Number of drills onwork safety
22,782
29,653
1,294
49,955
202120212021202220222022202320232023
202120212022202220232023
Investigation and Treatment of Hidden HazardsThe hidden hazards are generally classified into general and major hidden hazards. Dependent upon theirseverity and urgency, they shall be promptly recti?ed and closed.
To strengthen its ability and responsiveness to deal with emergencies, the Company has formulated emergencyresponse procedures such as theManagement Procedures for Risks, Opportunities and Emergency Preparednessand Response Plansto ensure that all emergency plans are implemented in a timely and effective manner inemergencies, standardize emergency management of unexpected work safety accidents, effectively implementemergency rescue in time, minimize casualties and property losses, guarantee employee safety, and ensure thatemergency management is quickly and e?ectively carried out in order.
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Case
Case
Emergency drill of Qingyuan Base
Series of activities of the Work Safety Month
To deepen the organization of the national work safety month with the theme that "everyone shall payattention to safety and can make emergency response", the Company has e?ectively strengthened theemergency response capabilities of all bases, departments and employees. Qingyuan Base carried out 5special emergency drills on safety, work in con?ned space and special equipment, and 16 ?re drills.
In June 2023, the Company organized the 22nd National Work Safety Month online and offline,continuously increased all employees' awareness of safety redline, promoted the performance ofresponsibilities for work safety, and effectively improved risk investigation and rectification. With thetheme that "everyone cares about safety and everyone can respond to emergencies", this activityfocused on performing safety responsibilities, strengthening emergency management, and popularizingsafety knowledge. We combined di?erent forms of safety training and education with emergency drills tofurther improve all employees' safety awareness and ability to avoid danger and escape.
Emergency Drills of Qingyuan Base
Question Answering on OrganizationalSafety Cultures and Skills of Qingyuan
Base of the Company
Organization of a Fire?ghtingCompetition in the "Work SafetyMonth" of Specialty EngineeringPlastics Company
A Series of "Work Safety Month" Activitieslike "Grid-connected Power Consumption"
Organized by Shanghai Kingfa
The Company insists on taking social interests as the foundations for its prosperity, upholds that "for thosetaken from the community, give back to the society", takes serving the country through industry as its ownresponsibility, and dares to assume social responsibilities. During the reporting period, the Company activelyparticipated in the national rural revitalization work, supported and made donations to public utilities such ashealth care, ?re?ghting, and education in various forms while serving and giving back to the public.
Social development and public welfare
The Company fully implementedthe work requirements ofthe central government forconsolidating and expandingthe achievements in povertyalleviation and comprehensivelypromoting rural revitalization,fulfilled social responsibilities,and contributed to social equality.
Specialty Engineering Plastics Company'sDonation of Money for Poverty Alleviationin Shigu Town, Gaozhou City
Chengdu Kingfa's Donation of Money forTargeted Support of Batang County, GanziTibetan Autonomous Prefecture.
Rural revitalization
During the reporting period
employees
27.3
hourswith an average participation time of
6.3516
millionThe total amount of external donationsmade by the Company was up to RMB
Case
Specialty Engineering Plastics Company supported villages and enhancedcooperation with private enterprisesIn July 2023, Special Engineering Plastics Company providedtargeted support for the rural construction of Dakui Village,Pinggang Town, Yangjiang High-tech Zone by coordinatingwith the Military-Civilian Integration Office of ZhuhaiCommittee of the Communist Party of China, in order tofacilitate the annual government support for the region,strengthen cooperation among private enterprises, and makedue contributions to creating a happy social environment.
Love and Dedication Award of Special
Engineering Plastic Company
participated in thevolunteer activities
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Environmental, Social and Governance Report
The Company actively promotes the concept of public welfare and insists on delivering warmth to society. Duringthe reporting period, we gave back to society in di?erent forms, including donations, volunteer activities, and socialpublicity. We cultivated our employees' awareness of public welfare, and conveyed warmth with actions.
Public bene?t activities
Case
Kingfa Medical donated medical materials to the Red Cross Society of HangzhouChina Branch, protecting the life and health of medical and nursing personnelIn May 2023, Kingfa Medical and the Red CrossSociety of Hangzhou China Branch held a donationceremony with the theme of "Protecting andCaring for the Angels with Technologies". KingfaMedical donated medical supplies with a totalvalue of RMB 1 million to the Red Cross Society ofHangzhou China Branch to support the work of themedical sta? of Jiande Center for Disease Controland Prevention, provide protection for their lifeand health, and express its determination to socialresponsibilities.
Kingfa Medical's Material Donation of One Million ChineseYuan to the Red Cross Society of Hangzhou China Branch
Tianjin Kingfa's Donation to Women and ChildrenDevelopment Foundation
Wuhan Kingfa's Condolences to the Fire Brigade and
Provisioning of Free Drinks for Heat Relie
Ningbo Kingfa's Investment of RMB 250 Thousand inthe Charity Foundation Named "Common Prosperity,Happy Home"
Shanghai Kingfa's Organization of Volunteer Services
for the Employees in Zhujiajiao Town
Knowledge is power, and education is the cornerstone. Adhering to the concept of rejuvenating the country througheducation, the Company supports the development of education through donation activities. In combination with ourbusinesses, we output knowledge through popular science activities to guide minors to foster their awareness of science.
Dream Building by Talents
Wuhan Kingfa's Donation of Books and Sports Equipment to Putan Kindergarten
and Huangling Middle School
Kingfa Medical's Donation of MedicalMaterials to Xiangxiao Beilu Primary School
Case
The National Industrial Innovation Center organized science popularization atschools, to carry forward scienti?c spirit and popularize scienti?c knowledgeIn September 2023, the volunteer science popularization team of the National Industrial InnovationCenter entered Guangzhou Experimental School A?liated to BNU to carry out the science popularizationon "Advanced materials", introducing the characteristics, application scenarios and impacts of plasticson life, supplemented by operable exhibits, to combine teaching with entertainment, enrich students'extracurricular life and cultivate students' interest in sciences.
Science Popularization by the Volunteers of the National Industrial Innovation Center in Classes
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meetings ofthe Board ofDirectors
meetings ofthe Board ofSupervisors
Disclosed
interimannouncements
regularannouncements
informationsecurityaudits
Performed
Cumulativelyapplied for
6,036
domestic andforeign patentsIncluding4,394inventionpatentsApply for
new patents
SDGs：
Held
generalshareholders'meetings
Responsibility forGovernance
Operation by the Board of Directors, theBoard of Supervisors and the generalmeetings of shareholdersThe Company has established a sound system for the operations of the general shareholders' meetings, theBoard of Directors and the Board of Supervisors, and continuously regulates their operation and decision-making, so as to ensure e?cient cooperation, checks and balances among the authorities, decision-making andsupervisory bodies. To protect the legitimate rights and interests of our shareholders and creditors, and regulateour organization and operations, we regularly update and perfect theArticles of Association,theRemunerationManagement System for Directors, Supervisors and Senior Management,theInternal Reporting System forMaterial Informationand other governance documents, which are disclosed on the website of the Shanghai StockExchange (www.sse.com.cn) and our o?cial website.
Architecture of the Company's Board of Directors
In strict compliance with theCompany Law, theRules of Procedures for General Shareholders' Meetings ofthe Companyand theArticles of Association, voting procedures are performed for convening and holding theCompany's general shareholders' meetings. The duties of the general shareholders' meetings mainly cover majordecision-making and regulatory a?airs of the Company. We also ensure that all shareholders attend the meetingsand fully exercise their consultation and voting rights.
Our Board of Directors strictly performs the duties for deciding on our major decisions and plans of the Companyand formulating our major systems in accordance with theCompany Law,theRules of Procedures for the Boardof Directors of the Companyand theArticles of Association. The Board of Directors has set up four professionalcommittees to provide professional advice and support for its decision-making.
General Meeting of Shareholders
Board of Directors
General Meeting of Shareholders
Board of Directors
NominatingCommittee
Board of Supervisors
Remunerationand Evaluation
Committee
Strategy andSustainabilityCommittee
Audit Committee
Secretary of the Board of Directors
Our Board of Supervisors conscientiously performs its duties in strict compliance with theCompany Law, the
Rules of Procedures for the Board of Supervisors and the Articles of Association. It regularly convenes meetingsto perform its duties for supervising and inspecting our directors' and o?cers' performance of duties and our?nancial a?airs, to truly protect our and our shareholders' rights and interests.
Board of Supervisors
Independence and Diversity of the Board of Directors
During the reporting period
During the reporting period
The Company attaches great importance to the independence of the Board of Directors. We have formulated andregularly updated theIndependent Director Work System. The Company attaches great importance to the pluralityof independent directors in the Board of Directors and its subordinate committees, so as to strengthen the fairnessof the Board of Directors' decision-making and protect the legitimate rights and interests of the shareholders.
the Board of Directorsconsisted of
members
of whom were
Either the Audit Committee, theNomination Committee or theRemuneration and Appraisal
membersCommittee has
The Strategy andSustainabilityCommittee had
members
of whom were
the Company held
general shareholders'
motions weremeetings at which a total ofconsidered
Board of Directors
motions weremeetings at which a total ofconsidered
Board of Supervisors
motions wereconsideredmeetings at which a total of
independent directors
of whom wereindependent directorsindependent directors
119118
2023
Responsibility forGovernanceEnvironmental, Social and Governance Report
NameGenderAgePosition HeldIncumbency of the committeesSpecialtyYuanZhimin
Male62Chairman
Strategy and Sustainability Committee,Nomination Committee, Remuneration and
Appraisal Committee
Li NanjingMale61
Director, General
Manager
XiongHaitao
Female59Director
Li JianjunMale60DirectorStrategy and Sustainability CommitteeNingHongtao
Male50DirectorAudit CommitteeWu DiMale39
Director, deputygeneral manager
ChenPingxu
Male41
Director, deputygeneral manager
Yang
Xiong
Male57
Independentdirector
Remuneration and Appraisal Committee,
Audit Committee
XiaoShengfang
Male54
Independentdirector
Strategy and Sustainability Committee,Nomination Committee, Audit Committee
ZengXingrong
Male61
Independentdirector
Strategy and Sustainability Committee,Remuneration and Appraisal Committee
MengYuezhong
Male60
Independentdirector
Strategy and Sustainability Committee, Nomination
Committee
Diverse Backgrounds of the Members of the Board of Directors
While emphasizing the independence of the Board of Directors, the Company also attaches great importance to thediversity of the Board of Directors. Sex, age, professional background and other dimensions have been considered innominating directors for the Nomination Committee. The Company believes that directors with diverse backgroundsmay help the Board of Directors better supervise its management and operations, evaluate the risks and opportunitiesof its business model from di?erent perspectives, and promote its formation of an equal, inclusive and open culture.
Major in polymersMajor in economicsMajor in ?nance Major in lawNote:
The Company adopts a salary structure of " annual base salary, annual performance pay, and long-termincentives". We have established a benefit and risk-sharing mechanism for our shareholders, managementand business backbones. Besides, we implement an equity incentive plan for all employees, to encourage ourmanagerial personnel, technical, business and operation backbones who satisfy the incentive conditions.
Remuneration and Equity Policies
Equity Policies for the Company's Directors, Supervisors and O?cers
In the event that the Board of Directorsfails to implement the first paragraph ofthis article, the responsible directors shallbear joint and several liabilities accordingto the law.
The stocks or other securities with equity natureheld by directors, supervisors, officers, andshareholders who are natural persons mentionedin the preceding paragraph include the stocksheld by their spouses, parents, and children, andheld through other people's accounts or othersecurities with equity nature.
For details of the remuneration policy and remuneration of the directors, supervisors and officers during thereporting period, please refer to Section IV - Corporate Governance of the2023 Annual Report.
If the Board of Directorsfails to follow the first paragraphof this article, the shareholders have theright to request the Board of Directors to act asspeci?ed therein within 30 days. Where the Boardof Directors fails to act so by the aforementionedtime limit, the shareholders shall have the rightto directly ?le a lawsuit with the people's court intheir name in the interests of the Company.
If a director, supervisor, officer or a shareholderholding more than 5% of the shares of theCompany sells the shares of the Company orother securities with equity nature held by himor her within 6 months after the purchase, orrepurchases them within 6 months after thesale, the proceeds therefrom shall be owned bythe Company, and the Board of Directors of theCompany shall recover the proceeds therefrom.except for the circumstance that a securitiescompany holds more than 5% of the shares due tothe purchase of the remaining shares after thepackage sale, and other circumstancesstipulated by the China SecuritiesRegulatory Commission.
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During the reportingperiod, the Companydisclosed
temporary
regular
Information disclosure
Transparent disclosure
The Company strictly complies with theMeasures for the Administration of Information Disclosure by Listed Companies.We have formulated theInformation Disclosure Management Systemand theInvestor Relations Management Systemtosafeguard the legitimate rights and interests of the stakeholders, and promote long-term e?cient win-win cooperationbetween the Company and the majority of stakeholders. Besides, the Company fully considers the correlations betweenprevious and subsequent information. Around the investors' demands for information related to decision-making, weorderly realize the positive cycle of "setting and ful?lling expectations" to build a good corporate image.
Standardized and transparent information disclosure is fundamental for the Company to maintain effectivecommunications with investors, regulatory authorities and other stakeholders. Our regular and temporaryannouncements truthfully, accurately, completely, promptly and fairly disclose the matters related to theCompany's operation and governance. The Company strictly ful?lls its obligations for information disclosure as alisted company, and actively protects the legitimate rights and interests of investors and other stakeholders.The Company designates the media that are qualified for information disclosure in the securities market asannounced by the China Securities Regulatory Commission and the website of the Shanghai Stock Exchangeas the media for publishing its announcements and other information to be disclosed. We have set up a specialcolumn for investor relations on our o?cial website to synchronize our important announcements, in order toensure that our investors and other stakeholders have easy access to accurate important information related tous through o?cial and authoritative channels.
Main Information Disclosure Channels of the Company
www.sse.com.cn
InternationalInternet websitesdesignated by CSRC
O?cial websiteof the Company
Media
China Securities JournalShanghai Securities News
Securities TimesSecurities Daily
Special column forinvestor relations
Disclosure of corporate reports
CommunicationsThe Company interacted with its investors through general shareholders' meetings, performance briefings,SSE E-interactive, investor hotline, and E-mail to convey the investment value of the Company, other channelsand methods. We actively accept visits and surveys from regulatory authorities and associations to strengthenthe transparency and accuracy of our information disclosure. After each regular report, a performance brie?ngis organized. Our officers such as the general managers, independent directors, chief financial officers, andsecretary of the Board of Directors are invited to participate in the exchanges.
Performance Brie?ng
Visit of Regulatory Authorities and Associations
Visit to the Site of the General Shareholders' Meeting
announcements andannouncements
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Responsibility for
GovernanceEnvironmental, Social and Governance Report
Risk Management
To improve our governance ability and risk management, ensure our long-term development and maximizeour interests, we have set up the Audit Committee under the Board of Directors to coordinate our compliancemanagement work and supervise the continuous operations of our compliance management system. TheCompany has formulated theInternal Audit System, Corporate Risk Control and Early Warning Planand othersystems, to strictly implement internal control and risk management, and ensure its steady development.
The Company annually identi?es risks. We carry out whole-process risk identi?cation for 67 risk categories in sixmajor risk links, build our own risk database and risk warning mechanism, and conduct clear e?ective managementand control of different risks that may affect our businesses. Based on the assessment results on risk level, theCompany classi?es risks into low, medium and high risks, and formulates corresponding countermeasures.
Internal Control and Management System of the Company
Response to Risks by Level
Responsible for compliancemanagement, theCompany's departmentslead and take charge of thecompliance managementof this system.
Identify the Legal Departmentas a general compliancemanagement department,which organizes, coordinatesand supervises the compliancemanagement work. It providesthe department responsible forcompliance management withcompliance support.
The Audit Departmentaudits and evaluatescompliance of ouroperations managementand compliancemanagement.
LowrisksMedium risks
High risk
Risks may be borne without additional controls.
Strictly control the risks in this area andadditionally formulate controls
Ensure that all risks in this area are avoided and
transferred, and give priority to implementing
the preventive actions.
The group's risk diagnosis results
Modi?cationsegment (domestic)
Modi?cationsegment (foreign)
Advanced materialssegment
Medicalsegment
Petrifaction
segment
While summarizing and managing risk issues, the Company initiates risk warnings to investigate and warn risks.The Company establishes conditions for triggering risk warnings, sends potential identical risks by carbon copy orperiodically releases them, to facilitate continuous attention and management of the risk database issues.
During the reporting period
the Company output a total of
risk identi?cation
of which the direct losseswere reduced by RMB
6.76
million
and the indirect losseswere cut by RMB
4.752
million
A total of
standards were added/revised.
By promoting the recti?cation of medium and high-risk issues, the Company avoided pecuniary losses
11.512
million in totalof RMB
medium risksand identi?ed a total of
medium and high risks
including
high risks and
A total of
identi?ed problemswith a recti?cation rate of
%
High riskMedium risks
First line of defenseSecond line of defense Third line of defense
summary reportswere recti?ed in 2022
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Responsibility for
GovernanceEnvironmental, Social and Governance Report
Business EthicsIn accordance with relevant laws and regulations on anti-corruption and anti-bribery, we have formulated aseries of rules and regulations such as theRegulations on Acceptance of Gifts for Business, Code of Conductfor Employees, Management Procedures for Business Ethics, and Management Regulations for Protectionagainst Commercial Bribery to regulate and control our employees' business conducts. We also enter into the
Integrity Commitmentwith our suppliers. TheManagement Regulations for Protection against CommercialBriberyregulate our establishment and maintenance of an incorrupt management system. All customers,suppliers, service providers, and contractors who have business and ?nancial dealings with us are covered by themanagement scope of this system. We have formulated the management policy for " bribery prohibition and fairtrade", and resolutely reject commercial bribery, briber and other illegitimate business conducts.
The Company attaches importance to incorruptible party construction. We have formulated theManagementRegulations for Ethical Operations, to incorporate the education on risks of integrity practice into our creationof "publicity patterns", include them in our cultural construction, and upgrade the education on prevention andcontrol of integrity risks for key positions into a topic of education for ?ghting corruption and upholding integrity.We have established a training system on compliance and business ethics for all our employees. According to thissystem, all marketing and ?nancial personnel are required to undergo training regarding anti-corruption, anti-bribery, and anti-money laundering. The employees of the Securities Department are regularly organized to learnabout the new regulations of China Securities Regulatory Commission. We actively perform compliance trainingin our places of business, covering local laws and regulations as well as our code of conduct for compliance andethics. We organize positive and negative typical education for the CPC members, to increase their awareness ofintegrity and self-discipline. Besides, we draw up annual work plans for Party construction to prevent corruption.The Company ?nds out and identi?es the integrity risks of key positions by self-inspection by the posts, maininspection by the leader, and further professional inspection. We take the utilization of public resources suchas human, financial, and material resources as clues for detecting the institutional defects and managementloopholes that are likely to cause corruption in key positions, possible abuse of power for private gains and lackof supervision that might result from the authorities in di?erent positions. The integrity risks identi?ed in the self-inspection by the posts will be submitted to our Supervisory Audit Department for preliminary examination onceapproved by the department heads after their primary examination, to determine the risk level. Then, organizefurther examination of our professional business, ?nancial and production systems, to ?nally reach conclusionson the risk identi?cation. Internally, we prepare a risk identi?cation table for integrity practice, and to a certainextent, we accept supervision by the masses.
Carefully analyze the identi?ed integrity risks andfurther classify risks. Clarify pertinent precautionarymeasures.Improve key links of production managementprocedures and work procedures of key posts.Improve our management measures for supervisingour systems regarding decision-making on majorissues, appointment and removal of important cadres,decision-making on investments in material projects,and use of large-sum funds, to increase operability andpracticability of the systems.Specify the particular requirements for importantmanagement, to e?ectively strengthen the controlover the risks in the decision-making on major issues,appointment and removal of important cadres,decision-making on investments in material projects,and use of large-sum funds in our project management
Build a team of disciplinary inspection and supervision personnel and strengthen managing signs of corruptionSupervise information on signs; establish a mechanism for collecting information on signs of corruption, analyze andevaluate the signs, and provide early warnings;continuously improve the measures for risk prevention and control.Promptly respond to early warnings by heart-to-heart talks, critical education, admonitory talks, deadline speci?cation forrecti?cation and organizational punishment, etc.
Forfeit all bribery proceeds,and perform relevant educationand administrative sanctionsdependent upon the seriousnessof the case; transfer THEM tojudicial organs for investigation oftheir criminal responsibilities if thecircumstances are rather serious.
Notify and supervise ourdepartments corresponding to therelated units and send a writtenwarning letter. If the circumstancesare serious, the suppliers andservice providers will be resolutelydisquali?ed. If their acts constitutea crime of commercial bribery(bribery), they will be transferredto the judicial organs for theinvestigation of their criminalresponsibilities.
Encourage the parties and insidersto whistleblow. We will rewardthe whistleblowers whose reportsare true as demonstrated afterinvestigation, and maintain theircon?dentiality.
We continuously improve our internal whistleblowing mechanism and whistleblower protection mechanism. Wehave set up a whistleblowing mailbox to receive employee complaints 24 hours all day long, strictly protect thewhistleblowers' information, strictly keep the reported information con?dential, and protect the whistleblowersfrom retaliation.
Internal Integrity Management Mechanism
Reward and Punishment Measures for Business Ethics
Measures for Preventing and Controlling Risks on Business Ethics
Risk analysis
Decision-making supervision
Respond to early warnings
Employees violating rulesSuppliers and serviceproviders violating rules
Truthful whistleblowing
AuditDepart-
ment
Departments
Assess and control our integrity risks; identify integrity risks of di?erent departments and positions.
Perform regular integrity inspection for each department, report the integrity problems to thegeneral manager if any, and formulate control measuresOrganize on-the-job integrity training for all departments and employees to increase theirawareness of integrity.Assist the audit Department in conducting regular self-examinations on their
integrity issues, and report the problems to the offices and the generalmanager in a timely manner if any; formulate corrective and preventiveactions, and organize key follow-up on their positions exposed tointegrity risks, and formulate corresponding management measures.
The functional departments supervise the implementationthrough e?ciency monitoring and other means with reference tothe professional management system.Decompose tasks and assign responsibilities to each departmentand speci?c persons in chargeBroaden the work scope of e?ciency monitoring, and give full playto the roles in error check, deviation correction, and guarantee ofe?ciency supervision.
Procedure supervision
Conscientiously implement several provisions on leadership andintegrity practiceStrengthen the leaders' incorruptible talks with personnel servingthe key posts and thematic study about integrity practiceStandardize supervision procedures, unblock reporting channels,and e?ectively protect the whistleblowers' personal safety andinformation con?dentiality
Democratic supervision
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Responsibility forGovernance
Environmental, Social and Governance Report
Information security protection
Data security
The Company is highly aware of the importance of information assets. We have established a sound managementsystem and conduct training for information security to ensure information confidentiality, integrity andavailability. The Company maintains stringent con?dentiality principles for the material information, and strictlycontrols the acquisition, storage, transmission and use of important information.
The Company has established a series of information securitymanagement systems, including theInformation Security ManagementRegulations, theManagement Measures for Security Baselines, and theManagement Measures for Information System Auditto guarantee thesecurity of information systems and data.
Annual Information Security Practices and Outcomes of the Company
During the reporting periodthe Company conducted
information
Build a uni?ed identitymanagement platform torealize uni?ed management
of personnel's digitalidentity and authentication,
and realize automatedcontrol in the entire lifecycleof accounts, to mitigate
risks in accounts and
authentication.
Cover the securitymanagement and controlmechanisms of subsidiaries,including managementstandards, technical controls(e.g. network access, terminalanti-virus, intrusion prevention).
Eliminate shortcomings in
security defense.
Establish standards forsecurity solutions tothe industrial controlnetwork to improve thesecurity protection levelof digital factories.
CaseInformation security training is conducted to learn about information security
The Company organizes thematic training about on-site information security for each subsidiary everyyear, which mainly covers the basic concepts of information security, its network threats, introduction ofmainstream attack methods (e.g. APT, denial-of-access attack and social work), analysis and explanationof typical information security incidents that have occurred in the Company, how to prevent them, andcommon security risks and prevention methods for office scenarios. Help the employees master thebasic knowledge and skills for protecting personal and corporate information assets through ongoingsecurity training. Increase the employees' information security awareness and response capabilities.Reduce information security threats brought by human risks to the Company. Ensure the continuous andstable operation of information systems and data security.
Information Security Training -
Chengdu
Information Security Training - Qingyuan
Information Security Training -
Pizhou
Information Security Training -
Wuhan
Information Security Training - Tianjin
The Company has formulated theManagement Measures for Information Security Training, and we ensuree?ective performance of training by reinforcing standardized management of the information security trainingthrough institutional documents.During the reporting period
Among them, the Company organized a total of
training sessions on information security of the subsidiaries
training session training sessions
information
the Company conducted
training sessions
with a coverage of
%security audits
related to informationsecurity management
security trainingsessions for newemployees
on awareness ofinformation securityfor key personnel, and
on information securitymanagement requirementsfor IT personnel.
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Responsibility forGovernanceEnvironmental, Social and Governance Report
Con?dentiality of Material Information
The Company has formulated theCon?dentiality Management Regulations, which stipulate that internal con?dentiality-related employees and external personnel shall enter into con?dentiality agreements to ensure that sensitive informationis not disclosed and the information security of the Company is guaranteed. In addition, the Company has also formulatedand strictly implemented theManagement Specifications for Major Meetingsand theManagement Specifications forMeeting Safety to ensure smooth progress of important meetings, con?dentiality and security of meeting information.
Digital Construction
The Company actively responds to the development trend of digital factories. We continuously promote theintelligent and automated transformation of production lines by introducing advanced information technologiesand digital production equipment.
数字化工厂总体规划与设计
Build digital factories with reliable quality, optimal costs and e?cient productionFourstrategies
Processreorganization
Automation
solutions
Systemintegration
Equipmentinterconnection
ProductsEquipmentProcessesWorkstation
IndustrialautomationHuman-machineseparationAutomaticunpackingand feedingAutomaticpreparationand mixingAutomaticmetering
Performance stability
Non-standard
customized color match
Flexible production
Improvement ofequipment stabilityExpedient equipmentoperationMore integratedequipment
Pain points in quality ande?ciencyBreakthroughs in industryBreakthroughs in technicalinnovationsbenchmarking
Design of line plansStandard operationsLean improvementMinimization of line-sideinventoriesof workstations
Supporting automation
One-click generationof color formulaAutomaticpreparation of colormasterbatchesAutomatic materialpreparationAutomatic inkjetmarking of bags
Test automation
Density/X-ray?uorescenceTest automationLIMS integrationAutomatic execution oftest plan
Logistics automationPackagingautomation
One goalFive dimensionsFour foundations
Eight Core Constructions of Digital FactoriesIntelligentwarehousing andlogistics system
Planned pull-type production
Decompositionand reorganizationof productionprocedures
Equipment lifecycle
management
Process systemconstruction
Color-matchmanagementfor productionTransparentproductionprocedures
Quality tracingand closed-loop
management
CasePut the digital factory into production and optimize the management procedures
In August 2023, Shanghai Kingfa Phase II digitalfactory was o?cially put into production, whichnot only marked the further improvement of theCompany's production capacity, but also was amilestone in the Group's digital transformation.Starting from the digital factory, the Companyimproves its production e?ciency, optimizes itsmanagement processes, and providescustomerswith higher-quality products and services usingadvanced technologies.
Shanghai Phase II Digital Factory Formally Put into Production
Master Planning and Design of Digital Factories
AutomaticunpackingAutomaticbaggingAutomaticpalletizingAutomaticplastic sealingAutomaticlabeling
Automatic warehousingof incoming materialsWarehousingautomationAutomatic materialrequisitionAutomatic AGV delivery
131130
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Responsibility forGovernanceEnvironmental, Social and Governance Report
Intellectual Property Protection
Intellectual Property Management
System Certi?cation
National AdvantageousIntellectual Property Enterprise
As of the end of the reporting period
the Company had appliedfor a total of
6,036domestic
including
4,394invention patents
During the reporting period, the Company ?ledapplications
utility models
design patents
PCT patents
and
foreign patents
It took the leadamong domesticmanufacturers in thequantity of di?erent
patents obtained.
Case
Case
Intellectual property training was performed to share the experience about thetransformation of achievements
Training on patent mining was conducted to enhance the Company's competitiveness
In April 2023, the training with the theme of"transformation of technological achievementsand innovation of industry-academia-researchintegration" hosted by the Guangzhou IntellectualProperty Protection Center was performed in theCompany. About 30 people from the Companyand related stakeholders participated in this event,providing experience and making suggestionsfor the intellectual property representatives oftechnology-based enterprises to transform theirtechnological achievements and conduct industry-academia-research cooperation.
From April to May 2023, the Company organized several patent training sessions for technicalR&D personnel, process equipment, and product R&D personnel, in order to help the employeescomprehensively improve their professional capabilities for patent mining and management.Through the training sessions, the Company improved the employees' understanding of the cutting-edge technologies, obtained powerful support for its innovations, enabled the employees to betterunderstand the patent systems and strategies for intellectual property protection, cultivated theirinnovative thinking and competition awareness, and enhanced its own competitiveness.
Intellectual Property Training
The Company has formulated management systems for intellectual property protection, including theIntellectualProperty Management Manualand theProcedural Documents for Intellectual Property, and established corporatestandards such as theIntellectual Property Management Regulations. By establishing de?nite intellectual propertymanagement systems, the Company has obtained the intellectual property management system certification andbeen evaluated as a National Advantageous Intellectual Property Enterprise. We have built an intellectual propertyoffice and department to clarify the responsibilities of our management representatives, intellectual propertyauthorities and other relevant departments, and appropriately allocate relevant resources. We have established andmaintained an intellectual property management system, and conduct management reviews every year.
and foreign patents
for domestic patents includinginvention patents, and
PCT applications.
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Responsibility forGovernanceEnvironmental, Social and Governance Report
GRI content index
Statement of use
Kingfa Sci. & Tech. Co., Ltd. has reported the information cited in this GRI content index for theperiod from January 1, 2023, to December 31, 2023 with reference to the GRI Standards.GRI 1 usedGRI 1: Foundation 2021
GRI 2: GeneralDisclosures 2021
2-1 Organizational detailsCompany Pro?le2-2 Entities included in the organization's sustainabilityreporting
About This Report2-3 Reporting period, frequency and contact pointAbout This Report2-4 Restatements of informationAbout This Report2-6 Activities, value chain and other business relationshipsCompany Pro?le2-7 Employees
Equality, Inclusion, and Diversity;
List of Key Performance Indicators2-9 Governance structure and composition
ESG Management System;
Operations of Three Boards2-10 Nomination and selection of the highest governance bodyOperations of Three Boards2-11 Chair of the highest governance bodyOperations of Three Boards2-12 Role of the highest governance body in overseeingthe management of impacts
ESG Management System;
Operations of Three Boards2-13 Delegation of responsibility for managing impactsESG Management System2-14 Role of the highest governance body in sustainabilityreporting
ESG Management System2-16 Communication of critical concernsStakeholder Communication2-19 Remuneration policiesOperations of Three Boards2-20 Process to determine remunerationSee the annual report2-22 Statement on sustainable development strategyTo Stakeholders2-23 Policy commitmentsEquality, Inclusion, and Diversity2-24 Embedding policy commitments
Contributions to UN Sustainable
Development Goals2-25 Processes to remediate negative impactsEmployees' Rights and Interests2-26 Mechanisms for seeking advice and raising concernsBusiness Ethics2-27 Compliance with laws and regulationsNo violation in the Company2-28 Membership associations
Main Participatory Domestic
Associations and Organizations2-29 Approach to stakeholder engagementIdenti?cation of Material Issues
GRI STANDARD GRI STANDARD DISCLOSURE DISCLOSURE LOCATION LOCATION
GRI 3: Material
Topics 2021
3-1 Process to determine material topicsIdenti?cation of Material Issues3-2 List of material topicsIdenti?cation of Material Issues3-3 Management of material topicsIdenti?cation of Material IssuesGRI 201: EconomicPerformance 2016
201-2 Financial implications and other risks andopportunities due to climate change
Addressing Climate Changes201-3 De?ned bene?t plan obligations and otherretirement plans
Employees' Rights and Interests201-4 Financial assistance received from governmentSee the annual reportGRI 203: IndirectEconomic Impacts
2016
203-1 Infrastructure investments and services supported
Social Development and Public
Welfare203-2 Signi?cant indirect economic impacts
Social Development and Public
WelfareGRI 205: Anti-corruption 2016
205-1 Operations assessed for risks related to corruptionBusiness Ethics205-2 Communication and training about anti-corruptionpolicies and procedures
Business Ethics205-3 Con?rmed incidents of corruption and actions takenBusiness EthicsGRI 206: Anti-
competitiveBehavior 2016
206-1 Legal actions for anti-competitive behavior, anti-trust, and monopoly practices
No related lawsuit in the Company
GRI 207: Tax 2019
207-1 Approach to taxSee the annual report207-2 Tax governance, control, and risk managementSee the annual report207-3 Stakeholder engagement and management ofconcerns related to tax
See the annual report
GRI 301: Materials
2016
301-3 Reclaimed products and their packaging materialsResource Conservation302-1 Energy consumption within the organizationEnergy Management302-3 Energy intensityEnergy Management302-4 Reduction of energy consumptionEnergy Management302-5 Reductions in energy requirements of products andservices
Energy Management
GRI 303: Water andE?uents 2018
303-1 Interactions with water as a shared resourceResource Conservation303-2 Management of water discharge-related impactsWaste Management303-3 Water withdrawalList of Key Performance Indicators303-4 Water dischargeList of Key Performance Indicators303-5 Water consumption
Resource Conservation; List of KeyPerformance Indicators
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2023
AppendixEnvironmental, Social and Governance Report
GRI 305: Emissions
2016
305-1 Direct (Scope 1) GHG emissionsAddressing Climate Changes305-2 Energy indirect (Scope 2) GHG emissionsAddressing Climate Changes305-4 GHG emissions intensityAddressing Climate Changes305-5 Reduction of GHG emissionsAddressing Climate Changes305-7 Nitrogen oxides (NOx), sulfur oxides (SOx), andother signi?cant air emissions
List of Key Performance IndicatorsGRI 306: Waste2020
306-1 Waste generation and signi?cant waste-relatedimpacts
Waste Management306-2 Management of signi?cant waste-related impactsWaste Management306-3 Waste generatedList of Key Performance Indicators306-4 Waste diverted from disposalWaste ManagementGRI 308: SupplierEnvironmentalAssessment 2016
308-1 New suppliers that were screened usingenvironmental criteria
List of Key Performance Indicators308-2 Negative environmental impacts in the supplychain and actions taken
Sustainable Supply Chain; List of
Key Performance IndicatorsGRI 401:
Employment 2016
401-1 New employee hires and employee turnoverList of Key Performance Indicators401-2 Bene?ts provided to full-time employees that arenot provided to temporary or part-time employees
Employees' Rights and Interests401-3 Parental leaveEmployees' Rights and Interests
GRI 403:
Occupational Healthand Safety 2018
403-1 Occupational health and safety managementsystem
Occupational Health and Safety403-2 Hazard identi?cation, risk assessment, andincident investigation
Occupational Health and Safety403-3 Occupational health servicesOccupational Health and Safety403-5 Worker training on occupational health and safetyOccupational Health and Safety403-6 Promotion of worker healthOccupational Health and Safety403-7 Prevention and mitigation of occupationalhealth and safety impacts directly linked by businessrelationships
Occupational Health and Safety403-8 Workers covered by an occupational health andsafety management system
Occupational Health and Safety403-9 Work-related injuriesOccupational Health and Safety403-10 Work-related ill healthOccupational Health and Safety
GRI 404: Trainingand Education 2016
404-1 Average hours of training per year per employee
Employee Development andTraining404-2 Programs for upgrading employee skills andtransition assistance programs
Employee Development andTraining
GRI 405: Diversityand Equal
Opportunity 2016
405-1 Diversity of governance bodies and employees
Equality, Inclusion, and Diversity;List of Key Performance Indicators406-1 Incidents of discrimination and corrective actionstaken
Equality, Inclusion, and Diversity
GRI 407: Freedomof Associationand Collective
Bargaining 2016
407-1 Operations and suppliers in which the right tofreedom of association and collective bargaining may beat risk
Employees' Rights and Interests
GRI 408: Child Labor
2016
408-1 Operations and suppliers at signi?cant risk forincidents of child labor
Equality, Inclusion, and Diversity
GRI 409: Forced orCompulsory Labor
2016
409-1 Operations and suppliers at signi?cant risk forincidents of forced or compulsory labor
Equality, Inclusion, and Diversity
GRI 411: Rights ofIndigenous Peoples
2016
411-1 Incidents of violations involving rights ofindigenous peoples
No event concerning infringementupon the indigenous people'srightsGRI 413: Local
Communities 2016
413-1 Operations with local community engagement, impactassessments, and development programs
Social Development and PublicWelfare
GRI 414: Supplier
Social Assessment
2016
414-1 New suppliers that were screened using socialcriteria
Sustainable Supply Chain; List ofKey Performance Indicators414-2 Negative social impacts in the supply chain andactions taken
Sustainable Supply Chain
GRI 416: Customer
Health and Safety2016
416-1 Assessment of the health and safety impacts ofproduct and service categories
Product Quality and Safety; List ofKey Performance Indicators416-2 Incidents of non-compliance concerning thehealth and safety impacts of products and services
Product Quality and Safety
GRI 417: Marketing
and Labeling 2016
417-1 Requirements for product and service informationand labeling
Customer Services417-2 Incidents of non-compliance concerning productand service information and labeling
Customer Services417-3 Incidents of non-compliance concerning marketingcommunications
Customer Services
GRI 418: Customer
Privacy 2016
418-1 Substantiated complaints concerning breaches ofcustomer privacy and losses of customer data
No related complaint in the
Company
GRI STANDARD GRI STANDARD DISCLOSURE DISCLOSURE LOCATION LOCATION
137136
2023
AppendixEnvironmental, Social and Governance Report
List of Key Performance Indicators
Environmentalprotection input
Total investment inenvironmental protection
CNY10,0005,510.875,640.236,689.70
Energy consumption
Direct energy consumption
Tons of standard
coal
331,099.35222,972.54618,559.85Natural gas
Nominal cubic
meter
45,420,273.2117,958,913122,408,572DieselTon393268284Coal water slurryTon432,334314,168424,676Propane
Ton00444,958Indirect energy consumptionTons of standard coal373,742.97315,849.68590,678.64Purchased electricity
'0000 kWh77,61073,306199,721Medium-pressure steamTon2,257,989.1631,641,952.2172,787,760.571Low-pressure steamTon250,039.67427,803.00325,068.7263PV power generation (self-generation for self-use)
'0000 kWh/ 1,1371, 334Total energy consumption
Tons of standardcoal
704,842.25540,220.241,210,877.98Intensity of energyconsumption
ton standardcoal/RMB '0000operating revenue
0.180.130.25
Consumption ofwater resources
Purchased municipal waterTon5,359,0273,870,98910,627,435Desalted waterTon002,452,794GroundwaterTon002,356
IndicatorsUnit202120222023IndicatorsUnit202120222023
Emissions ofgaseous pollutants
Total waste gas emissions
m
15,167,781,31512,115,581,98221,795,515,009Recovery rate of waste gases% 8.03 10.52 26.26ParticlesTon32.234336193.155492753.820625Non-methane hydrocarbonTon310.468257.075127.673Nitrogen oxidesTon124.825745216.483935106.111583Sulfur oxideTon33.950.83353.434989VOC emissionsTon309.76721.231,446.83
Emissions of waterpollutants
Total wastewater discharge
Ton528,164.01,463,014.45,434,078.1Recovery rate of wastewater%11.544.058.54Chemical oxygen demand(COD)
Ton29.66282.933238.711Five-day bod (BOD5)Ton11.03614.79545.819Suspended matterTon12.20213.32234.577Ammonia nitrogenTon0.5222.0436.055Total phosphorusTon0.1850.5841.822
| 1.In 2021, the Company deployed photovoltaic modules, by which power was generated for self-use, but the PV power generation was not systematically analyzed.2.The PV power generation was included in the total energy consumption. | 3.From August 2022, Liaoning Kingfa started trial production and pollutant discharge, so material changes occurred to propane consumption, purchased electricity, emission, and other indicators. | |
139138
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AppendixEnvironmental, Social and Governance Report
Waste emissions
Total waste emissionsTon13,691.320,803.5320,873.35Recovery rate of wastes%22.9725.6833.89Emissions of hazardouswastes
Ton2,026.23,360.68,848.17Emissions of non-hazardouswastes
Ton11,665.117,442.9312,025.14Emissions of high-level wastesTon000Customer services
Customer satisfaction%//92.4Customer complaint handlingrate
%100100100
Sustainable supplychain
Total number of suppliers/3,2266,6998,307Suppliers of Mainland China/3,1026,4308,009HK, Macao, Taiwan, andforeign suppliers
/164269298Percentage of Supplier Codeof Conduct signed
%100100100Percentage of supplierswith clauses that includeenvironmental and laborrequirements*
%100100100Total number of new suppliers/4903,4331,608Percentage of new suppliersthat were screened usingenvironmental criteria*
%100100100Percentage of new suppliersthat were screened usingsocial criteria*
%100100100Percentage of our purchasingspecialists passing sustainableprocurement training
%0100100
Employees
MalePerson6,6898,2218,541FemalePerson1,8472,1292,08851 and abovePerson56475689241~50Person1,8192,0552,12431~40Person3,5654,0364,03430 and belowPerson2,5883,5033,579Employees working inMainland China
Person8,1669,97310,217Other countries and regionsPerson370377412DoctorPerson106124168Master DegreePerson7078951,136UndergraduatePerson1,4832,5362,849Below the Bachelor's DegreePerson6,2406,7956,476Total number of grassrootsemployees
Person4,6864,6095,122Total number of employees inmiddle management
Person113114122Total number of employees insenior management
Person525264Scienti?c research personnelPerson1,0591,1121,447Human resourcesPerson9592123Financial sta?Person243278317Operations managementPerson315325639Information technologiesPerson6579105OtherPerson6,7598,4648,005
IndicatorsUnit202120222023IndicatorsUnit202120222023
141140
2023
AppendixEnvironmental, Social and Governance Report
Employment
Total rate of new employees%211823Total turnover rate%181419
Employee
training
Total number of trainedemployees
Person7,4138,68510,658Classi?cation by gender: trainedmale employees
Person6,0136,9878,565Classi?cation by gender: trainedfemale employees
Person1,4001,6982,093Classi?cation by type: trainedgrassroots employees
Person6,4017,6429,546Classi?cation by type:
trained employees in middlemanagement
Person827854923Classi?cation by type: trainedemployees in senior management
Person185189189Total training hours of employeesh206,303.79257,857.65440,232.29Average training hours peremployee
h27.8329.6941.3Classi?cation by gender: totaltraining hours of male employees
h166,079.06211,775.97340,458.75Classi?cation by gender:
total training hours of femaleemployees
h40,224.7346,081.6899,773.54Classi?cation by type: totaltraining hours of grassrootsemployees
h125,015.94173,064.13345,720.65Classi?cation by type: totaltraining hours of employees inmiddle management
h63,596.366,313.175,316.8Classi?cation by type: totaltraining hours of employees insenior management
h17,691.5518,480.4219,194.84
Social welfare
Amount of investment in socialpublic welfare
CNY10,0001,486.11,166.85635.16Number of participants inemployee volunteer activities
Person-times147199181Average time spent on employeevolunteer activities
h2956.2127.3
Main Participatory Domestic Associationsand Organizations
UnitAssociations/organizationsPosition Held
The Company
China National Light Industry CouncilVice chairman unitsChina Plastic Processing Industry AssociationVice chairman unitsPlastic Carbon Neutrality Working Group of the National
Technical Standardization Committee on Plastics
Director and member
unitsTechnical Subcommittee on Modi?ed Plastics of the NationalTechnical Standardization Committee on Plastics
Director and member
unitsChina Synthetic Resin Association
Standing councilmember unitsABS Branch of China Synthetic Resin AssociationMember UnitChina Association of Automobile ManufacturersVice chairman unitsChina Household Electrical Appliances AssociationMember Unit
China Packaging FederationVice chairman unitsSociety of Competitive Intelligence of ChinaOrdinary member unitsChina Electronics Standardization Institute (National TechnicalStandardization Committee on National All-or-nothing Relays)
Director and member
unitsWorking Group on Standards for Pollution Prevention and Controlof Electrical and Electronic Products, Ministry of Industry and
Information Technology
Member units with fullauthoritiesChina Association for Public CompaniesCouncil Member
KingfaEnvironmental
Professional Committee on Recycling of Plastics, China Plastic
Processing Industry Association
Director unitsRecycled PCR Self-discipline OrganizationInitiatorsGreen Recycle Plastic Supply Chain Group (GRPG)InitiatorsSustainability Working Group on Food Contact MaterialsMember units
IndicatorsUnit202120222023
143142
2023
AppendixEnvironmental, Social and Governance Report
Overview of Certi?cates
System certi?cation
GuangdongKingfaComposites
Guangdong
Kingfa
NingboKingfaLiaoningKingfa
Kingfa(USA)
Kingfa(Europe)
Factory ofKingfa (India)in Chakan
Factory ofKingfa (India)in Pondi
Factoryof Kingfa(India) inManesar
Quality
ISO 9001?????????IATF 16949??????ISO 13485??
MDSAP?
5GONOGO??
EnvironmentISO 14001?????Occupationalhealth andsafety
ISO 45001????Hazardoussubstances
QC08000LaboratoryISO/IEC 17025?SustainabilityGRS?
Socialresponsibilities
CSR(SA80000/RBA/SMETA/IWAY)
??MeasurementISO 10012Intellectual
property
GB/T 29490
Brandcertification
GB/T 27925EnergiesISO 50001
Other
GB/T23001Integration ofinformatization andindustrialization
managementsystemsAEO??BRC (packaging
materials)
ISO 28000??
System certification
TheCompany
ShanghaiKingfa
JiangsuKingfaWuhanKingfaTianjinKingfaChengduKingfa
KingfaEnviron-mental
JiangsuKingfaRecycling
QingyuanBase
SpecialtyEngineeringPlasticsCompany
ZhuhaiKingfa
Quality
ISO 9001??????????IATF 16949???????ISO 13485MDSAP5GONOGO?EnvironmentISO 14001?????????Occupationalhealth andsafety
ISO 45001?????????Hazardoussubstances
QC08000???LaboratoryISO/IEC 17025??SustainabilityGRS?????Socialresponsibilities
CSR(SA80000/RBA/SMETA/IWAY)
????MeasurementISO 10012?Intellectual
property
GB/T 29490????Brandcertification
GB/T 27925?EnergiesISO 50001??
Other
GB/T23001
Integration ofinformatizationandindustrialization
managementsystems
?
AEO??BRC (packaging
materials)
?ISO 28000?
145144
2023
AppendixEnvironmental, Social and Governance Report
Reader's Feedback
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Thank you for reading the "2023 Environmental, Social and Corporate Governance (ESG) Report of the Company".To provide you and other stakeholders with more professional and valuable corporate ESG information, pleaseanswer our related questions in this feedback form to help us further improve our future ESG work.
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Disclaimer
The information contained in this Report does not constitute any investment advice. Investors should not usesuch information in place their independent judgment or make decisions based solely on such information,and the Company will not assume any responsibility for any losses which are or might be caused by the use ofthe information in this Report. The information published by the Company is true and accurate. In case of anyinconsistency with a statutory disclosure document, the latter shall prevail.If this Report constitutes a forward-looking statement, it shall not be binding upon our future actions. The Companyneither bears an obligation nor undertakes to revise the forward-looking statement (if any) contained herein.The copyright and right to ?nal interpretation shall be owned by the Company.
Editor-in-Chief: Li JianjunAssociate Editor: Dai Yaoshan Responsible Editors: Tang Hailan, Kuang SirongMembers of the Editorial Board (arranged in random order): Ye Nanbiao, Huang Hesheng, Li Peng,Fu Jiangying, Lu Yuanqiu, Lei Yuewen, Xu Xianjun, Xiao Peng, Guan Xunning, Zhang Chao, ZengXiangbin, Fu Xuejun, Chen Yan'an, Wang Zongke, Qi Wenliang, Peng Zhongquan, Rao Xiang, Wu Bo,Wei Deguang, Gu Junyong, Ding Min, Yu Xingxing, Peng Zhi, Liu Siyang, Cai Hongxiang, Ning Kaijun,Lin Jinlong, Ren Jie, Zhao Shijun, Hu Qisong, Li Baosen, Qin Chunyan, Li Yihang, Wu Jiechun, WangTingting, Tang Hongli, Lu Jingwen, Deng Xiaojun, Yang Yong, Liu Jin, Huang Haibin, Guo Pan, CaoLiying, Deng Zhendong, Chen Huazhang, Lou Zhihe, Wen Yanmei, Wang Shuting, Hu Miao, LiaoMengyuan, Zhou Binzhuo, Zhou Ruxin, Huang Shifang, Xiao Minting, Lin Sisong, Ren Ming
2023Environmental, Social and Governance Report