恒逸石化：2024Environmental,Social,and Governance(ESG)Report

Hengyi Petrochemical Co., Ltd

2024 Environmental, Social, and Governance (ESG) Report

CONTENTS

Corporate GovernanceCompliant OperationBuilding IntegrityESG Governance

Safety ResponsibilityProduct QualitySuperior ServicesResponsible Supply Chain

ProspectsAppendixReport Content IndexesFeedback Sheet

About this reportChairman's StatementAbout HengyiHonorsESG Highlights in 2024Feature：Carrying Forward FiftyYears of Achievements, andPioneering a New Era with Resolve

Creating MutualTrust and Valuewith Shareholders

Earning CustomerTrust with Quality

2024 Environmental, Social, and Governance (ESG) ReportHengyi Petrochemical Co., Ltd.

Climate Change ResponseEnvironmental ManagementWater Resource UtilizationPollutant Emission Reduction

R&D and InnovationRespect PatentAchievementsDigital TransformationIndustry Exchanges andCooperation

Employees' Rights and InterestsOccupational Health and SafetyUnblocked Growth ChannelWarm Care for Employees

Rural VitalizationPhilanthropyServe CommunityDevelopmentContribution to the BRI

Striving forHarmony with theEnvironment byGreen Development

Leading Innovation-Driven Developmentwith Science andTechnology

Growing Togetherwith Employees

Building aHarmoniousCommunity with aShared Future

This is the sixth independent report released by Hengyi Petrochemical Co.,Ltd.. This report comprehensively discloses relevantinformation in detail of the Company in the environmental, social, and governance aspects in 2024 to respond to the concerns andexpectations of stakeholders.Organizational ScopeThe main entity of this report is Hengyi Petrochemical Co., Ltd., including its branches, subsidiaries, and a?liates.

Reporting Period

This report covers the period from January 1, 2024 to December 31, 2024. Some content may be appropriately extended beyondthe stated period according to disclosure needs.Preparation BasisThis report is prepared in accordance with the requirements of theGuidelines No. 3 for Self-Regulation of Listed Companies-Standardized Operation of Preparation of Sustainable Development Reportof Shenzhen Stock Exchange and with reference to theGRI Sustainability Reporting Standards( GRI Standards)issued by Global Reporting Initiative (GRI), as well as theUnited NationsGlobal Compact, ISO 26000: Guidance on Social Responsibility (2010) issued by International Organization for Standardization .AbbreviationsFor better presentation and readability, Hengyi Petrochemical Co.,Ltd. is also referred to as "Hengyi", the "Company" and "We" inthis report.Data SourcesThe information and data cited in this report come from the o?cial documents, statistical and ?nancial reports of the Company.The reporting materials are provided by Hengyi employees and partners. It's only for disclosing Hengyi's sustainabilitymanagement progress instead of commercial use. The ?nancial data in this report is subject to the annual report data. Other datais from internal statistics. The currency used in this report is RMB unless otherwise noted.Report Access

The Board of Directors of the Company approved this report on April 22, 2025. This report is available in both Simpli?ed Chineseand English versions. For any inconsistency of the content, the simpli?ed Chinese version shall prevail. You can visit our website todownload this report.O?cial Website：www.hengyishihua.com / CNInfo：www.cninfo.com.cn

About this report

Hengyi Petrochemical Co., Ltd.2024 Environmental, Social, and Governance (ESG) Report

Chairman's Statement

In the past year, we consolidated the foundation for high-quality development by focusing on our primaryresponsibilities and core business operations. As a global leader in the integrated “re?ning-chemicals-?ber” value chain,we systematically expanded and reinforced our industry chain while ensuring the safe, stable, and e?cient operation of existingproduction capacity. Major projects were prioritized as catalytic initiatives to optimize industrial structure, accelerate thetransition from traditional to new growth drivers, and advance sustainable high-quality development. This strategic focus hasfurther enhanced our integrated industry chain, characterized by balanced, pillar-like structural robustness. During the reportingperiod, Phase I of our Qinzhou project in Guangxi achieved vigorous progress, Phase II of Hengyi Industries Sdn Bhd's re?ning andchemical project advanced as planned, and all ongoing projects maintained steady progress aligned with established targets.In the past year, we focused on technological innovation to develop new drivers of industrial upgrading. With steadfastcommitment to our “Ten-Year Ten-Billion” R&D investment initiative, we made substantial progress in propelling the transitionfrom an industrial Hengyi to a technological Hengyi. We dramatically expanded our recruitment of top-tier talent and signi?cantlystrengthened our R&D capabilities in core technologies in key ?elds. Our research accomplishments earned multiple prestigiousawards, including the second prize of Zhejiang Provincial Technology Invention Award, the China Chemical Fibers Association-Hengyi Foundation for 2024, the Excellence Award of the “2024 Petroleum and Chemical Industry Patent Awards".In the past year, we vigorously pursued green development and charted a new course for the circular economy. Weactively implemented China's carbon peaking and carbon neutrality goals, driving green and low-carbon transformation acrossour industry chain with a focus on “green manufacturing” and “circular economy” principles. We comprehensively integratedenergy conservation and environmental protection into all production and operational aspects while developing and promotinggreen technologies. With particular emphasis on adopting new energy solutions and waste heat recovery systems, we workeddiligently to establish ourselves as an environmentally responsible enterprise committed to resource e?ciency.In the past year, we put the people-?rst principle into practice, and marked a new chapter in building a community witha shared future. We maintained consistently healthy, safe, and rewarding work environments for all employees while successfullyorganizing ten major events to celebrate our 50th anniversary. The sixth installment of our Employee Stock Ownership Plan(ESOP) progressed as scheduled, accompanied by the phased rollout of both our share repurchase program and the controllingshareholders' share accumulation plan. Furthermore, we expanded our charitable and educational foundations to foster inclusiveand caring community environments.2025 marks the culmination of the Company's Sixth Five-Year Plan, the planning year of the Seventh Five-Year Plan and thecommencement of our second half-century strategic goals. Driven by our corporate spirit of “Relentless Pursuit of Excellence,”we will vigorously execute all established projects while developing new quality productive forces at a faster pace. With thepioneering spirit of true innovators, we will con?dently embark on our new journey to build a centennial Hengyi. With unwaveringdiligence, strategic wisdom, and dedicated e?ort, we stand ready to promote high-quality development in our next chapter.

The year 2024 marked the 75th anniversary of the People's Republicof China. It was also a crucial year for achieving the objectivesand tasks laid down in the 6th Five-Year Plan of Hengyi. Amid acomplex macroeconomic landscape and persistently challengingmarket conditions, the Company worked collaboratively with allstakeholders to overcome various difficulties. We consistentlytreated ESG implementation as an internal driver of high-quality development. By strengthening our foundation throughcore business focus, achieving breakthroughs via innovation,demonstrating leadership in green transformation, and ful?lling oursocial responsibilities, we have made substantial progress towardsour vision of “becoming one of the world's top-tier petrochemicalindustry groups.”

About Hengyi

Hengyi Petrochemical (000703.SZ) aspires to become a world-class and domestic leadingpetrochemical industrial group. Through resource sharing and industrial coordination, the Companybolsters overall competitiveness. Currently, we have formed a multi-faceted “petrochemical+”industrial layout, with the petrochemical industry chain driven by “polyester + nylon” serving as thecore business, petrochemical ?nance and trade as the growth business, and big data of chemical ?berindustry chain and intelligent manufacturing as the emerging business.For years, our overall competitiveness has maintained a leading position in the industry. Our mainproducts include re?ned oil products (gasoline, diesel, and jet fuel); basic petrochemical feedstocks(PX,benzene,PTA, PIA,CPL, and LPG); polyester new materials (POY, FDY, DTY, polyester staple fiber, PETchips, and PET bottle-grade chips).This integrated product system deeply serves fundamental sectorsof the national economy and essential demand-driven industries, such as energy, textile and apparel,packaging, electronics, and construction materials. We lead the segment of di?erentiated and high value-added products with our antimony-free, eco-friendly Eticont polyester chips and fibers, cationic polyester chips and fibers, ultra-high elasticity?bers, rabbit fur-like ?bers, special-shaped silk, color silk, masterbatch silk, Hengyi bamboo silk, Hengyidragon silk, and Hengyi colored silk.Hengyi has developed a unique "54354" corporate culture mechanism, focusing on ?ve sub-cultures:

shared creation, dedication to excellence, pioneering spirit, stability and security, and mutual bene?ts.We adhere to four principles of “the realization of historical experience, the collectivization ofindividual knowledge, the humanization of rigid institutions, and the tactical transformation of strategicblueprints”, aiming for harmony between culture and strategy, business growth and employeedevelopment, and cultural advantage and competitiveness. By building ?ve driver systems of seniorleadership, employee demand, full participation, social interaction, and institutional security, Hengyiaspires to be a century-old enterprise deeply respected, well received, trusted, and loved by society,customers, shareholders, and employees.

Persistence rewards the diligent, noble

aspirations reach far

Build a century-old, evergreenfoundation and stand among theworld's renowned enterprisesPragmatism, responsibility,surpassing, and sharing.

Never stop moving forward,create brillianceBecome one of the world's top-tierpetrochemical industry groups

BusinessLayout

HengyiCulture

MissionCore values

HengyiPetrochemical

Philosophy

VisionSpirit

Honors

Honors

Chairman and President Qiu Yibo was honored with the title of “Outstanding CEO in Advancing SmartManufacturing in China.” and “2024 Digital Transformation Leader in the Industry” by the JudgingCommittee for Digital Transformation and InnovationC&EN's Global Top 50Listed among the “billion-dollar club rankings of global chemical companies” released by the US ChemicalWeeklyOutstanding Corporate Social Responsibility Practices by Chinese Private Enterprises in 2024Carbon Neutral Top 50 of the ESG Golden Bull Awards from the China Securities JournalOutstanding Enterprises in Brand Building 2024 from the China Chemical Fibers AssociationOutstanding Cases of Digital Economy Development in Zhejiang Province for 2024Hengyi Petrochemical: Building an End-to-End Smart Factory received the China Industrial Internet ExcellentApplication Award“Outstanding Sustainable Development Practice Cases of Listed Companies in 2024”“4A secretary in theevaluation of secretaries' performance 2024”“Outstanding Practice Cases of Annual Report PerformanceBrie?ng for 2023”and Top 100 Best Practices over the Past Decade of the Belt and Road Cooperation byChinese Listed Companies from the China Association for Public CompaniesThe “Outstanding Collective” honorary title from the Manufacturing Industry Digital TransformationStandardization Working Group of the National Information Technology Standardization TechnicalCommitteeEasy-Clean Nylon won the second prize of Zhejiang Provincial Technology Invention AwardFlame retardant polyester and TiO

-Based Delustering Slurry for Nylon Fibers were listed in ZhejiangProvince's ?rst batch of new materials for 2024Five technologies, including the atmospheric low-temperature dyeable polyester ?ber with disperse dyesand PTT composite fiber, were included in the Green and Low-Carbon Technologies Compilation for theTextile Industry 2024The patented preparation method for TiO

Matting Agent received the Excellence Award of the “2024Petroleum and Chemical Industry Patent Awards” and ?ve Paper Awards from the China Chemical FibersAssociation-Hengyi Foundation for 2024

Honors

2024 Environmental, Social, and Governance (ESG) ReportHengyi Petrochemical Co., Ltd.

ESG Highlights in 2024

2111,000

Meetings of the Board of Directors Shareholders meetings

Meetings of the Board ofSupervisors held

Special meetings of independent directors

Disclosed on the o?cial websites of HengYiand SZSEThe company organized investor exchangeactivities, reaching a cumulative total of

million

million tons

%

MWmillion kWh

%

million tons

399.89

7.94

130200

0.15

Invested in environmental protection RMB

Total CO

emissions

The emission intensity of VOCsdecreased by

As of 2024, the company's PV installedcapacity has reached

With annual green power generation-including solar PV, wasteheat recovery, and esteri?cation-based power exceeding

The emission intensity of particulate matter (PM), sulfurdioxide (SO

), and nitrogen oxides (NO

x) each declined by

Year-on-year decrease

Since its listing, the company'scumulative dividend payoutamounthas exceeded

The company implemented the ?vephases of the share repurchase programand has repurchased shares worthbillion

timestimes

announcementsparticipants

times

timesbillion

5.43.2

Governance Performance Environmental Performance

ESG Highlights in 2024

million

participants

professors

patents

million

million

million

billion

donorstimes

169.49100

480.935.214,580

28.77

1,000

5,882

Invested in safety RMBPass rate of safety training

National and industry standards formulated orrevised by the company

From 2019 to 2024, from Zhejiang University,Donghua University, and other leadinginstitutions appointed as Hengyi Scholars

Accumulated purchase underthe ESOP

Amounting to RMBBene?ted employee

As of 2024, the company boasts validgranted

In 2024, the company'sR&D investment reachedapproximately RMB

In 2024, the company and itscontrolling shareholder Hengyi Groupcollectively donated RMB

The company has created local jobs inBrunei nearly

As of 2024, the company has organizedemployees participants in voluntaryblood drives without compensationMobilizing

%

Social Performance

Hengyi Petrochemical Co., Ltd.2024 Environmental, Social, and Governance (ESG) ReportFeature

Carrying Forward Fifty Years of Achievements,and Pioneering a New Era with Resolve

Starting from a knitting mill of the Yaqian Commune in Xiaoshan, Hengyi has ridden thewinds of reform and opening-up. The Company has woven a remarkable chapter in China'sprivate enterprise story with pioneering courage. The hum of looms in old workshops hastransformed into a grand symphony of the Company's global petrochemical ambition.Driven by innovation, we sail steadfastly towards our vision of “becoming one of theworld's top-tier petrochemical industry groups,” and strive to make new contributions tohigh-quality development and Chinese modernization.The year 2024 marked the 75th anniversary of the People's Republic of China and the50th anniversary of Hengyi's establishment. On this milestone occasion, guided by ourcorporate spirit of “Relentless Pursuit of Excellence” and anchored in the guidance ofParty building, we launched ten signature initiatives to showcase our commitment tosocial responsibility and humanistic values.

Cultural and art gala Bridging hearts with culture and art, mapping a blueprint with joint e?ortsOn October 18, 2024,Hengyi grandly held the “Fifty Years of Glory·Marching Toward the Future” culturaland art gala. The event, featuring songs, dances, skits, and traditional opera, fully displayed Hengyi's50-year journey of hard work. The gala outlined the grand vision of building a century-old Hengyi, andshowcased the deep integration of Party building and corporate growth through di?erent arm forms. Tensof thousands of global viewers joined the gala via live stream, witnessing the brilliance of Hengyi's culturalin?uence.

The 50th Anniversary Cultural Evening of Hengyi Group was successfully held

2024 Environmental, Social, and Governance (ESG) ReportHengyi Petrochemical Co., Ltd.

治理领航 夯实发展根基Feature

50 Years, 50 Legends Drawing wisdom from history and commending trailblazers of excellenceOn October 18, 2024,at the 50th-anniversary celebration of Hengyi, we proudly honored 50 outstandingrepresentatives who were dedicated contributors, loyal employees, R&D elites, production pioneers, and businesstrailblazers. The commendation embodied Hengyi's core spirit, which not only eulogized hardworking individualsof the Company, but was a call for all employees. It inspired them to strive relentlessly toward Hengyi's vision ofbuilding a century-old enterprise.

The Award Ceremony for "Loyal Employees"The Award Ceremony for "R&D elites"

The Award Ceremony for "Hengyi Craftsmen"

Group wedding ceremony Building a happy home togetherOn September 10, 2024,the 4th Employee Group Wedding Ceremonytook place romantically by the shores of Hangzhou's Xianghu Lake.Twenty-?ve couples, dressed in early 20th-century traditional attire,exchanged vows before family, friends, and company leaders. Theevent reinforced employees' sense of belonging and happiness.It also showcased the Company's harmonious culture where the“corporate family” and “individual families” flourish togetherunder the guidance of Party building.The 4th Employee Group Wedding Ceremony

Hengyi Craftsmen Celebrating mastery and driving innovationOn September 26, 2024,the third “Hengyi Craftsmen” selectionwas successfully conducted to honor outstanding employees acrossall levels, from frontline workers to engineers and managers. Theinitiative recognizes exemplary individuals who demonstrate bothmeticulous craftsmanship and innovative thinking. It reinforces ourcommitment to the artisan spirit while strengthening the talent andtechnological foundation for building a centennial Hengyi. A total of22 individuals were honored as “Hengyi Craftsmen” and receivedprestigious recognition during the Company's 50th anniversarycelebration.

The Award Ceremony for the Singing Competition

The 23rd Group Blood Drive

Voluntary blood drive Spreading compassion and demonstrating responsibility

On August 7, 2024,Hengyi successfully held the 23rd group blood drive, which showcased the Company'sdedication to social contribution and setting a benchmark for corporate philanthropy in ZhejiangProvince. A total of 197 employees participated, donating 68,550 milliliters of blood. Since 2002, Hengyihas organized 5,882 employee participants in voluntary blood drives, with a cumulative volume reaching1,657,341 milliliters.

On June 18 - September 18, 2024,Hengyiorganized an essay contest for all currentand former employees, seeking to reveal theprofound values embodied in “ordinarypeople and their untold stories.” Thecompetition generated hundreds ofsubmissions, with 40 exceptional entriesultimately chosen as award-winning works.

Essay contest Celebrating Hengyi's spirit through storytelling

Singing competition Uniting employee spirit and igniting youthful energ storytelling

On June 18, 2024,Hengyi hosted the 11th“Top Ten Singers” competition, whichattracted nearly 100 employee participants. Theevent provided a dynamic platform for talentshowcase and passion sharing, and fostereda “joyful work, healthy living” culture topromote corporate culture development.

Feature

Carrying Forward Fifty Years of Achievements,and Pioneering a New Era with Resolve

2024 Environmental, Social, and Governance (ESG) ReportHengyi Petrochemical Co., Ltd.

The Final Evaluation Site of the Knowledge Competition

On September 21, 2024,the knowledge competitionengaged 14 teams in a spirited contest. This interactiveevent enhanced employees' understanding of ourcorporate culture and history. By reflecting on theCompany's journey of perseverance and achievement,participants developed deeper respect for policies andprocedures while renewing their commitment to workplaceexcellence.To celebrate the 50th anniversary of Hengyi's founding, we organized ten themed events, including an essay contest,a cultural and art gala, a voluntary blood drive, and a craftsmen commendation activity. The events not only showedthe deep integration of Party building with corporate operations, but also highlighted our corporate culture and socialresponsibility. Standing at the new milestone, Hengyi will continue to uphold its red heritage and bravely shoulder themission of our times. With ?rmer conviction, a more open mindset, and pragmatic initiatives, we aim to compose anew chapter of high-quality development in the process of building a century-old enterprise, and contribute Hengyi'sstrength to the Chinese path to modernization!

The Event Site of the "Walking Rally"

Basketball league Building team spirit togetherOn July 14, 2024,the 19th “Hengyi Cup” Men's BasketballLeague brought together over 150 players from 14 teams.In a total of 23 intense matches, the athletes embodiedthe sporting spirit of “Faster, Higher, Stronger,” fuelingthe Company's progress with unstoppable energy andteamwork.

The 19th "Hengyi Cup" Men's Basketball League Knowledge competition Gaining wisdom from history to unite for progress

Walking rally Action meets commitment for forging a determined spirit

On June 22, 2024,embracing the athletic ethos of “joy, health, low-carbon and eco-friendliness,” Hengyi employeesgathered along the Qiantang River for the “Walking Rally.” The event combined knowledge quizzes and teamchallenges, integrating corporate culture with health awareness to inspire employees on Hengyi's new developmentaljourney. With over 400 participants, the event o?ered two routes: a 6-km family walk and a 12-km advanced challenge.

Feature

治理领航 夯实发展根基

Creating MutualTrust and Valuewith ShareholdersGuided by modern governance principles, Hengyi strives to build arobust internal management system while adhering to compliantoperations and ethical business practices. The Company activelypromotes ESG governance and enhances management andinternal control, thereby sustaining value creation for shareholdersand driving high-quality development.

Regular reports were issued

1,000

2024 Actions and Responses

To help achieve the United Nations 2030Sustainable Development Goals (SDGs)

Meetings of theBoard of DirectorsShareholdersmeetingstimestimes

participants

announcementsreports

timestimes

Meetings ofthe Board ofSupervisors held

Special meetingsof independentdirectors

Disclosed on the o?cial websites of HengYiand SZSE

The company organized 9 investor exchangeactivities, reaching a cumulative total of

In strict compliance with laws and regulations,including the Company Law, Securities Law,Code of Corporate Governance for Listed Companies, and the Shenzhen Stock ExchangeListing Rules,we steadily improve our corporate governance structure and internal controlsystem to standardize corporate operations. Our governance framework consists of theShareholders' Meeting, the Board of Directors, the Board of Supervisors, and the seniormanagement, all functioning with independent business and operational autonomy. Wemaintain independence across business activities, assets, personnel, organizational structure,and finance, supported by a clear division of responsibilities and an effective checks-and-balances mechanism. To further facilitate the “going global” initiative for Chineseenterprises, we have strengthened the governance of both the Board of Directors and theBoard of Hengyi Brunei through a dual-board (“headquarters-region”) model. By retainingstrategic decision-making authority at headquarters while granting autonomy to localoperations, we continuously enhance our international management capabilities.

As the Company's standing decision-making body, the Board of Directors reports

The Company convenes and holds the meetings in strict accordance withthe provisionsand requirements of the Rules for Shareholders' Meeting of Listed Companies, the Articlesof Association and the Shareholders' Meeting Rules,and treats all shareholders fairly.The Company conducts online voting and discloses minority shareholders' votes inannouncements to actively safeguard all shareholders' legitimate rights, including their accessto information, participation in decision-making, and oversight of the Company's majorresolutions.

Corporate GovernanceGovernancestructure

Shareholders meetings

In 2024Shareholders' Meeting

Directors, the Board and specialized committees

HengyiPetrochemical

Co., Ltd.Shareholders

Meeting

Board of

Directors

SeniorManagement

Strategy&Investment Committee

Audit CommitteeRisk Control Committee

Board of Supervisors

BoD O?ceCompensation Committee

Audit&Legal

Production Management

Investment

Human Resource

Financial Management

Capital ManagementSafety&EnvironmentInformation&Data

O?ce

times

Creating Mutual Trust and Value with Shareholders

As per the Company Law, the Articles of Association

and other applicable regulations, the Board ofSupervisors supervises the Company's businessoperations while protecting the legitimate rightsand interests of the Company, its shareholders andcreditors. The Board of Supervisors comprises threemembers, with two of them being female.The Senior Management, as the executive body of the Company, is appointed by and reports tothe Board. After a general election, the Management currently consists of 6 senior executives,involving experts in di?erent ?elds such as research and innovation, petrochemicals,engineering,procurement, sales, ?nance,and capital operations. with professional capabilities and richmanagement experience.We have always prioritized investor relations (IR) management, therefore engaging withinvestors proactively and in good faith. By establishing a multi-dimensional and di?erentiatedinvestor engagement system, we continuously enhance our IR management capabilities. Withimproved information disclosure and a two-way constructive communication mechanism,we communicate the Company's value to capital markets efficiently. We remain committedto rewarding investors through active market capitalization management, and adopt multiplemethods, such as cash dividends and share repurchases, to enhance investor returns. Theseinitiatives strengthen long-term investor confidence and support the achievement of theCompany's strategic objectives.

Investorrelations

Meetings of the Board ofSupervisors held

Meetings of the Board ofdirectors

The company's board of directorsconsists of a total ofSpecial meetings of independentdirectors

Including independent

Which accounts of the board

The proportion of female directorsand supervisors is%

timestimes

times

directors

directors%

33325Board of Supervisors

Senior Management

to the Shareholders' Meeting, and is responsible for formulating strategic blueprints, setting long-term performanceand management objectives, evaluating business results, overseeing executive management, and mitigating risks.The Company emphasizes diversity of Board members in terms of age, gender, professional background, andexpertise. All Directors possess extensive industry and risk management expertise across multiple disciplines,including finance, law, and economics. This enables them to bring comprehensive, integrated, and internationalperspectives to corporate decision-making. Notably, over half of the Board members are under 45 years of age. Thiscan foster innovation in modern management practices and signi?cantly enhance governance e?ectiveness.The Company's independent directors diligently fulfill their duties of diligence, loyalty, and independence. Intheir daily work, they remain well-versed in the Company's operations, ?nancial status, and major projects, whileoffering professional opinions and ensuring the objectivity and independence of their oversights. The Companyhas established a dedicated independent directors' meeting mechanism that requires each independent directorto complete a minimum of 15 days of on-site work annually, maintain comprehensive performance records, andexercise pre-approval responsibilities for signi?cant matters and compliance operations.In 2024

In 2024

The Company has effectively communicated investment value and gained broad market recognition through various investorengagement activities, including one-on-one and group conference calls, on-site investor meetings, brokerage strategy sessions,and earnings brie?ngs. These initiatives have reached over a hundred investment institutions (including sell-side and buy-side?rms) and nearly a thousand investors.In 2024, we held two briefings on investment earnings to address nearly 100 investor questions.In addition, through channelssuch as the investor hotline, we actively addressed concerns, enhanced engagement with individual investors, and conveyed theCompany's value.

We steadfastly combine law-based corporate governance with compliance operations.Through continuous optimization of our compliance management system, tightenedinternal control and audit, and strict adherence to compliance requirements, we solidifythe foundation of sustainable and steady development.

CompliantOperation

We strictly abide by national laws, regulations, and industry standards, and haveestablished a comprehensive compliance management system centered on managementresponsibilities, encompassing risk prevention, monitoring, and response. Our complianceframework covers all business areas, departments, subsidiaries, and employees, and spansthe entire process, from decision-making and implementation to supervision, reporting,and improvement. This ensures that all our business operations are legal while e?ectivelymitigating legal risks. Furthermore, we actively conduct compliance training programsto communicate the importance of compliance to employees through various channels.These e?orts help foster a compliance culture and strengthen employees' legal awarenessand compliance mindset.

Compliancemanagement

We rigorously conduct compliance management in accordance with laws and regulations,including theBasic Standards for Enterprise Internal Controland related guidelines. First,we maximize the e?ectiveness of internal audits to enhance the implementation of internalcontrol policies and strengthen compliance risk identi?cation and assessment. Second, weregularly engage external auditors to conduct specialized audits on the establishment andimplementation of our internal control system. Furthermore, the Board's Audit Committeeoversees and evaluates both internal and external audit activities, thereby safeguarding thelegitimate rights and interests of the Company and all shareholders.

Strengtheninginternal audit

The company organized 9 investorexchange activities , reaching acumulative total of

Disclosed on the o?cial websites ofHengYi and SZSEIncluding regularreports2111,000

In 2024

Since its listing, the company's cumulativedividend payout amounthas exceeded

The company implemented the five phases of the sharerepurchase program and has repurchased shares worth

billion

announcementsparticipantsreports

billion

5.43.2

As of the end of 2024

The Company conducts regular self-assessments of internal control. In accordance withrelevant management policies, all departments identify key risks in business processes andjointly establish a risk control matrix. Supported by a scienti?c risk assessment mechanism, wepromptly identify and ?ag potential risks, while implementing e?ective measures to mitigateand resolve them.

Risk control

With a robust risk assessment mechanism in place, we start with risk identi?cation and conductin-depth analyses of potential risks. Based on precise risk evaluation, we develop targetedresponse strategies while ensuring accuracy and comprehensiveness. Based on the evaluationresults, we meticulously document risk details, assign risk levels, and prioritize critical risks,particularly those requiring immediate resolution or posing signi?cant impacts.We organize regular risk prevention and compliance training sessions, and engage experiencedexternal legal experts to deliver specialized courses for employees. Through case studies,regulatory breakdowns, and interactive methods, we strengthen employees' risk awarenessand reinforce adherence to compliance requirements at all times.

On May 11, 2024, the Company held a seminar on theBusiness Secret Risk Prevention Guidelines, featuringprofessional police o?cers who helped employees enhance their business secret management skills and strengthencorporate confidentiality awareness. The session supported our ongoing efforts to standardize business secretprotection measures while improving our ability to mitigate leakage risks and respond effectively to potentialbreaches.

A training session on business secret protection

Risk assessment

Risk training

Case

We completed operationalmanagement and special audits

Major fraud incidents occurredAnd ?nishedengineering audits plus

External audit120127

In 2024

The seminar on business secret risk prevention

Creating Mutual Trust and Value with Shareholders

Building Integrity

The Company has set up an anti-fraud working group led by the Chairman, who is responsiblefor authorizing investigations of reported matters and making decisions on the handling ofcertain employees' fraudulent acts. In order to continuously improve the anti-corruptionprevention and control system and reduce corruption incidents, the Company has set up anindependent audit and legal department to carry out anti-corruption efforts guided by theAudit Committee.We have implemented a comprehensive business ethics framework with robust oversight,including key policies such as theCode of Business Conduct and Ethics, Anti-fraud Guidelines,Employee Integrity and Ethical Conduct Regulations, and Anti-Money Laundering Regulations.

These measures strengthen ethical awareness across our workforce and ensure alignmentwith our standards among partners. Through multi-channel communications (emails, WeChat,calls, etc.), we actively promote integrity principles and unequivocally reject commercialbribery, money laundering, monopolistic behavior, and unfair competition. To institutionalizethese values, we have hosted an integrity and compliance conference featuring signedanti-corruption pledges, aiming to reinforce strict ethical discipline for all employees andleadership. Collectively, these e?orts drive Hengyi's sustainable development as a corruption-free enterprise.

Anti-corruption andanti-fraud

On June 28, 2024, the Company invited senior officials from the Economic Investigation Police of Xiaoshan DistrictBranch of Hangzhou Public Security Bureau to deliver a special lecture on integrity and compliance awareness foremployees. The session featured an in-depth analysis of occupational crime characteristics and root causes throughcase studies, along with compliance recommendations for establishing a corruption-free enterprise. These focused on?ve key areas: strengthening accountability, implementing rotational supervision, establishing whistleblower rewards,managing the “key few,” and promoting an ethical corporate culture.

Holding an integrity and compliance awareness lectureCase

Employees sign integrity pledges

Conducting a Special Lecture on Integrity and compliance awareness

ESGGovernance

Hengyi attaches great importance to complaint and whistleblowing management,and has established a comprehensive, multi-tiered mechanism. Through policyannouncements, the official website, WeChat official account, as well as variousmeetings and events, we o?er multiple reporting channels to ensure timely handling ofall complaints and reports.The Company strictly protects whistleblowers' privacy and safety. All reported materialsare treated as con?dential, with the identities of whistleblowers and related details keptstrictly secure. Retaliation in any form is strictly prohibited, and violations confirmedthrough investigation will face severe penalties in accordance with company regulations.In cases involving illegal or criminal conduct, we will refer the matter to judicialauthorities without hesitation, steadfastly upholding our role as a “protective shield”for whistleblowers.

We have fully embedded the core principles and standards of ESG into corporategovernance and established a scientific, professionally structured ESG managementsystem tailored to our operations. Meanwhile, we thoroughly identify the impacts of ESG-related factors on our operations and adopt a goal-driven approach to ensure e?ectivemanagement, thus fostering a virtuous cycle between corporate development andresponsibility ful?llment.

Whistleblowerprotection

We have established a top-down, multi-stakeholder collaborative ESG governanceframework. The Board of Directors serves as the supreme governing body for ESGoversight, and is responsible for guiding the implementation of the Company'ssustainability initiatives and providing strategic direction for ESG development.

Responsible forfinalizing theESG strategy andensuring that theimplementationof the strategy andESG demands areintegrated into thedecision-makingprocess

Responsible forimplementing theESG strategy andrequirements ofthe Board, andreporting regularlyto the Board on theplanning of ESGa?airs and progress

Mainly responsiblefor the day-to-daymanagement of ESGinformation, as wellas accepting theESG managementguidance fromthe Company'sheadquarters andproviding feedbackon managementperformance

Responsible for undert-aking ESG projects andcoordinating and prom-oting the implementati-on of routine ESG man-agement; collaborating-with external organizati-ons to provide externaldata and intellectual su-pport for the Company'sESG initiatives

ESG developmentmanagement

Anti-fraud O?ce reporting channels:

Tel: [phone] (ext: 1890)E-mail: [e-mail]

ESG management framework

Decision-making bodyBoard of Directors

Overall coordinatorSenior Management

Coordination levelFunctional departments

Executive levelProduction departments

and subsidiaries

Creating Mutual Trust and Value with Shareholders

StakeholderCommunication

The Company attaches great importance to the demands and expectations of stakeholders. Weengage with stakeholders through diversi?ed channels to understand their needs, actively takemeasures to provide reasonable responses, and strive to gain their support and trust, therebydriving continuous improvement in social responsibility management.

Compliant operationsTax ComplianceWaste EmissionsLocal Employment PromotionDriving local economic developmentAddressing climate change and carbon emissions

Government supervisionParticipating in major eventsSuch as symposiums andSeminarsPress Release / AnnouncementCorporate WebsiteInformation Disclosure

Enhance Corporate GovernanceFinancial Growth and Shareholder ReturnsBusiness EthicsThe authenticity, accuracy, timeliness, andCompleteness of information disclosure

Information DisclosureResults Brie?ngShareholders' MeetingCorporate WebsiteRegular Reporting &CommunicationInvestor RoadshowInvestor Hotline / Email /WeChat O?cial Account

Equal Employment & Compensation & Bene?tsEmployee careOccupational health and safetyUnblocked Career Development

Integrity and complianceGood customer relationshipsHigh quality products and service qualityProduct innovationProtecting Customer Rights and Interests

Workers' congressSuggestion Box / EmailEmployee ActivitiesWebsite and WeChat o?cialAccount, ect.

Customer Satisfaction SurveyCustomer Service HotlineClient Response MechanismCustomer VisitsCorporate Website

Stakeholder identi?cationDemands and expectationsCommunication methods

Government andregulators

Shareholders and investors

Employees

Customers

Ensuring productqualityConsolidating safetyresponsibilities

Compliant operationsOptimizing resource utilization

Devoted to the R&D

and innovation

Responsible supply chainProtecting employeerights and interestsAddressing climate change

Unblocking career paths

Promoting green processes

Reducing pollution emissions

Providing high-quality servicesInvestor relations

Business ethicsCaring for employees

ESG governance

Deepening the Belt and Road cooperationCarrying out community charityStrengthening environmental management

Fairness and TransparencyResponsible SourcingIntellectual Property ProtectionInformation Resource SharingHarmonious Community DevelopmentLow-carbon Environmental ProtectionSupporting Philanthropic CausesJob Creation

Routine VisitsVendor SummitDedicated Hotline / EmailTender Brie?ng SessionPublic Welfare ActivitiesOn-site InvestigationsDedicated HelplineMedia Communication & Coverage

Stakeholder identi?cation

Partners

Communities

Materialityanalysis

The company established a fundamental process for analyzing the significance of ESGtopics. Through topic identification, research evaluation, and prioritization, we examineddemands and key concerns across all industrial chain segments and stakeholders. Using adual-dimensional framework assessing "importance to external stakeholders" and "degreeof impact on Hengyi Petrochemical," we identified and prioritized 19 material topics.TheBoard of Directors validated the prioritization results in alignment with the company'slatest development strategy and the petrochemical industry's characteristics. This processculminated in the creation of a materiality assessment matrix, which determines the keydisclosure content of this report and focuses on addressing core ESG issues.

Core topicsImportant topicsGeneral topics

Creating Mutual Trust and Value with Shareholders

Demands and expectationsCommunication methods

The importance of external stakeholders

The degree of signi?cant impact on Hengyi

治理领航 夯实发展根基

Striving forHarmony with theEnvironment byGreen Development

To achieving the goals of carbon peaking and carbon neutrality, Hengyi actively implements China's key strategic decisions inthis aspect. The Company earnestly explores the path for bothpollution and carbon reduction, and continuously improves theenvironmental management system. Efforts have been made tostrictly implement energy-saving and emission reduction measureswhile employees are advocated to lead a low-carbon work-life style,in an e?ort to create a green culture.

In 2024, we expanded ourPV installed capacity byMW

399.89

130200

2024 Actions and Responses

To help achieve the United Nations 2030Sustainable Development Goals (SDGs)

million

MWmillion kWh

Invested in environmentalprotection RMB

As of 2024, the company's PVinstalled capacity has reached

With annual green power generation-including solar PV, waste heat recovery,and esteri?cation-based power exceeding

ClimateChangeResponse

Hengyi actively responds to domestic and international policies tocombat climate change and China's call for "carbon peaking and carbonneutrality". The Company strengthens carbon emission management andcarries out energy conservation and carbon reduction. We take variousmeasures to accelerate our green and low-carbon transition. Besides ourendeavors on promoting the transformation of low-carbon technologiesand energy efficient technologies, we attach importance to renewableenergy utilization, and develop low-carbon products while facilitatinggreen power trading.

Carbon emissionmanagement

Energyconservation andconsumptionreduction

The Company's HSE Management Committeeis tasked with overall layout and holisticpromotion for carbon management. The carbonmanagement system, which prioritizes controlover carbon intensity and is supplemented bycontrol over total amount of carbon emissions,has been further improved. An organizationalframework for carbon management is in placeto coordinate and supervise each department incarbon emission management. They serve as anorganizational and institutional guarantee for therealization of "double carbon" goals.

The Company's energy consumption and carbon emissions are mainlyfrom its production and operations, the types of energy including raw coal,purchased power, and natural gas, etc. A holistic energy managementsystem has been built to standardize and strengthen the energymanagement of each factories and workshops, realizing online monitoringof energy consumption data and centralized energy management. Inorder to better facilitate energy conservation and emission reduction, theCompany has adopted methods such as energy structure optimization,technological transformation, and carbon asset management. We hope toincrease the proportion of clean energy and energy e?ciency while reducingdirect and indirect energy consumption.

The Company conducts carbon peaking and carbon neutrality work e?cientlyand methodically, with clear goals and tasks.Expediting green transformation in modes of production and ways of life, weadvocate for an economy and society built on e?cient use of resources andgreen and low-carbon development, ensuring carbon peaking by 2030 andcarbon neutrality by 2060.IndicatorTarget typeBaseline for 202520242030Total Scope 1 & 2carbon emissions(million tons)

Absolute8.837.94

Below 25% increasein total Scope 1&2carbon emissions

Short and medium-term targets

General goal

Amount and intensity of carbon emissions2024

7.94

0.15

6.13

1.81

0.006

Total CO

emissions(million tons)Year-on-year decrease in total CO

emissions(milliontons)Total Scope 1 CO

emissions(million tons)Total Scope 2 CO

emissions(million tons)Intensity of CO

emissions(million tons/RMB billion)

We contribute to green production by implementing projects such as 100% rooftop PVcoverage in factories, construction of PV power generation experimental bases, and theapplication of peak-valley energy storage.In 2024, we expanded our PV installed capacity by 52 MW. As of 2024, the company'sPV installed capacity has reached 130MW,with annual green power generation of 125.3GWh,including solar PV, waste heat recovery, and esterification-based power exceeding 200million kWh.

Energy structureoptimization

In October 2024, Hengyi's Brunei Natural and RenewableEnergy Sustainable Integration Project was o?cially launchedon PMB. Planning to reach an installed capacity of 476 MWp,the project is going to install solar PV panels in areas such asrooftops, open spaces, arti?cial lakes of plant areas, coastalland and open spaces of PMB. By the end of 2024, the designand equipment procurement of the 48 MWp PV project havebeen completed and various government licenses have beenobtained. The 3.985 MWp PV system has been installed andput into operation on the rooftops and small open spacesof plant areas to maximize the solar power generation. Thecompletion of the project will not only support the energydemand of Hengyi's brunei petroleum refinery, but alsopromote Brunei's transition to a cleaner energy structure. Itwill signi?cantly reduce carbon emissions, contributing to agreener and sustainable future for Brunei.

The Brunei Natural and Renewable Energy SustainableIntegration Project launched on PMBCase

The Company has introduced advancedequipment and processes while phasingout outdated capacity. Energy-savingrenovations, such as acetaldehyderecovery from wastewater, esterifiedsteam waste heat power generation, andsupporting waste heat power generation,have been carried out to enhanceenergy conservation and consumptionreduction. In 2024, approximately 100%of our polyester production capacity hadincorporated the acetaldehyde recoverytechnology, with about 20,000 tons ofacetaldehyde and 10,000 tons of glycolrecycled.

Energy-saving renovations

The Company continues to participate in green power trading and increase theproportion of green power. In 2024, our trading volume of green power reached

481.42 GWh, including 406,459 green power certi?cates that were equivalent to about

406.46 GWh of green power.

Carbon assetmanagement

Supporting waste heat powergeneration installationAcetaldehyde recovery installation

Striving for Harmony with the Environment by Green Development

Identi?cation ofenvironmentalhazards

The Company has formulated anEnvironmental Self-monitoring Plan and an EnvironmentalProtection Inspection System. We organize monthly investigations on environmental hazardsand push subsidiaries to conduct environmental protection inspection, particularly onabnormal operation of environmental protection facilities and behaviors that do not meetenvironmental protection requirements. Identified problems shall be rectified in a timelymanner. The Company hires qualified third-party institutions to carry out environmentalassessment and requires simultaneous design, construction and delivery for new construction,reconstruction and expansion projects. Projects can only progress after passing theenvironmental assessment and approval.

Invested in environmental protection RMB

million

399.89

Our subsidiary Haining Hengyi won the title of municipal "Green Factory"

10 environmental volunteer supervisors are hired from neighboringcommunities every year for daily environmental protectionsupervision and inspection.

Hengyi (Brunei) carries out seawater monitoring andrealizes the all-round protection of targets sensitive tothe surrounding environment, such as corals, ?shinggrounds, and underwater creatures, etc.

Environmental Management

Environmentalmanagementsystem

The Company strictly abides by relevant laws and regulations such as theEnvironmentalProtection Law and the Environmental Impact Assessment Law.We have formulatedand refined the environmental management system and the Environmental ProtectionManagement System, consolidating thefoundation for the Company's environmentalmanagement.As of the reporting period, 9 of our subsidiaries were certi?ed by the ISO 14001:

Environmental management systems.

In 2024

Environmentalemergencymanagement

The Company attaches great importance to intensifying environmental risk prevention andemergency response, ensuring that all subsidiaries prepare emergency response plansfor environmental incidents. We improve environmental emergency plans and conductenvironmental emergency drills to test and improve our capabilities of responding toenvironmental emergencies, so as to e?ectively prevent ecological risks.Green CultureCultivation

Adhering to green and low-carbon concepts, the Company advocates starting theimplementation of energy-saving and environmental requirements from small things. Wepromote green office for all employees and organize them to participate in environmentalpublic welfare activities and knowledge training, allowing the green culture to be rooted intheir hearts.

On May 16, 2024, Hengyi Brunei organized employees to come to the forest reserve of Brunei Biodiversity Park to planta total of 500 trees. That was also the seventh consecutive year for the Company to organize the reforestation projectin Brunei, which demonstrated the Company's contribution to Brunei's environmental protection and the ?ourishingfriendly China-Brunei relations.

Hengyi Brunei holds the 7th reforestation projectCase

Striving for Harmony with the Environment by Green Development

WaterResourceUtilization

On June 2024,our subsidiary ZhejiangYisheng won the title of provincialwater-saving enterprise in 2023

Water-saving technology

To reduce raw water consumption, we collect the condensate discharged intothe trench during the production process of the installation. It is then sent tothe circulating pool for water replenishment and recycling.

The Company strictly follows the national guidelines, policies, laws and regulationson water conservation.The Water Conservation Management Regulations, theWater Conservation Assessment Regulationsand other systems are revised tostandardize water resources management. A water conservation managementteam is in place to formulate water-saving plans based on the planned productoutput every month. The lean management of water resources is reinforced in anall-round way through technical transformation of water-saving facilities, water-saving supervision and inspection of public appliances, and employee engagementin water-saving management.

PollutantEmissionReduction

The Company strictly complies with laws and regulations including the theAtmospheric Pollution Prevention and Control Law, the Water Pollution Preventionand Control Law and the Law on Prevention and Control of EnvironmentalPollution by Solid Waste.In-depth pollution discharge control is carried out toreduce discharge of wastewater, exhaust gases, and solid waste. In 2024, weexperienced no signi?cant environmental pollution incidents, maintaining a 100%compliance rate with emission standards.The Company has established a digital platform for safety and environmentalprotection information. Modules such as online monitoring management, videosurveillance management, hazardous waste management, resource and energymanagement, and environmental protection facilities management enable us toaccess to the real-time pollutant discharge data of each outlet and the operation ofenvironmental protection facilities, so that we can ensure up-to-standard dischargeof all pollutants. In addition, the Company strictly monitors the application,processing and extension of sewage discharge permits for plants of each subsidiary,making sure that all plants obtain valid sewage discharge permits.

The Company strictly complies with theAtmospheric Pollution Prevention and ControlLaw, the Emission Standard of Pollutants for Synthetic Resin Industry, the EmissionStandard of Air Pollutants for Boiler,and relevant local emission standards. To ensure thesafety, compliance and reduction of exhaust gas emissions, we control emissions fromthe source and improve processes, while strictly controlling and reducing the emissionsof dust, non-methane total hydrocarbons, acetaldehyde, smoke and other exhaust gases.

Exhaust gasemissionreduction

Lower VOCs emissionintensity

Lower PM, SO2, and NOxemission intensity

%

%

Treatment and emission methods for di?erent exhaust gasesFlue gas from boilers

Discharge through chimneys after the combined process of“bagdedusting + SNCR and SCR denitration + limestone gypsumdesulfurization”Spinning exhaust gasDischarge through exhaust funnels after treatment by oil smoke puri?ersPTA dustDischarge through exhaust funnels after treatment by pulse dust collectorsOrganic exhaust gasUse RTO (Regenerative Thermal Oxidation) installations to improve theincineration e?ciency to over 95%

Oil smoke puri?ersBag ?ltersRTO installations

In 2024

Striving for Harmony with the Environment by Green Development

Under the principle of“separating by pollution type, rainwater and sewage, and industrial/domestic wastewater”, we establish a sound in-factory wastewater collection system,employing measures against corrosion, leakage, and seepage to control discharge ofwastewater. We utilize the natural rainwater resources and implement the project of separatingrainwater from sewage. The initial rainwater is collected and stored in the emergency poolwhile the later rainwater is discharged into the nearby rivers. The wastewater generated inproduction is subjected to biological treatment, ultra?ltration and reverse osmosis treatment,before being reclaimed and reused. We achieve an 87~93% reuse rate of reclaimed water.

Wastewateremissionreduction

In 2024, the Company collected biogas from the anaerobic process of sewage treatment in some polyester factoriesfor power generation. As a replacement of torch combustion, the method realizes the recycling of resources and thesustainable use of energy.

Biogas power generation recycles resourcesCase

Under the principles of recycling, reduction, and harmlessness, the Company reduces theamount of waste gas produced from the source while maximizing recycling. We establish aledger system for solid waste generated in our production process and set up temporary wastestorage facilities. Coupled with classified collection, storage, and quality-based disposal ofhazardous waste and general solid waste, we ensure safe and e?cient treatment of waste.Wastereduction

Reclaimed water treatment equipment

We pay high attention to strengthening noise pollution prevention andmanagement, steadily improving the environment around our projects andthe places where our projects are located.Noise pollution control

In the stage of designand equipmentprocurement, chooseadvanced low-noiseequipment, such aslow-noise fans, aircompressors and pumps,etc. to reduce equipmentnoise from the source.

Take sound insulationmeasures to cut offthe noise propagationand set up soundproofrooms for high-noiseequipment such asfans, pumps andcompressors.

Strengthen themanagement of largevehicles entering andleaving plant areas. Nosirens limited speed inplant areas and near theentrances and exits.

Take anti-vibrationand vibration dampingmeasures to reducethe strength of noisesources. Use dampingpads for the installationof high-noise equipmentor dig anti-vibrationtrenches around it forbetter bu?ering e?ect.Measures to control noise pollution

In strict compliance with theLaw of the People'sRepublic of China on the Prevention and Control ofEnvironmental Pollution by Solid Waste,we entrustthe disposal of hazardous wastes (including wasteoils, polymer residues, spent activated carbon, wastemineral oils, etc.) exclusively to licensed treatmentfacilities with corresponding hazardous waste treatmentqualifications and operational capabilities. Allhazardous waste transfers are conducted in accordancewith relevant regulations, including obtaining propertransfer approvals and strictly implementing thehazardous waste manifest system.

Hazardouswaste

General waste

Hazardous waste transported to quali?edcompanies for disposal

Damping pads

In accordance with theLaw of the People's Republic of China on the Prevention and Control ofEnvironmental Pollution by Solid Waste,we sell waste blocks/slices, used ?lter cartridges, textile wasteand scrap silk, and discarded packaging materials to recycling companies, and entrust the environmentalsanitation department to dispose domestic waste.

Striving for Harmony with the Environment by Green Development

治理领航 夯实发展根基

Leading Innovation-Driven Developmentwith Science andTechnologyHengyi positions scientific and technological innovation as thecore driver of transformation and upgrading. We are committed toadvancing from a traditional petrochemical enterprise toward ahigh-tech, green, and intelligent future. By consistently increasingR&D investment and integrating multi-stakeholder resources, thecompany focuses on developing innovative green chemicals andadvanced materials, and works with stakeholders to become aglobally competitive innovator.2024 Actions and Responses

In 2024,

new industry standards were released,

additionalstandards submitted for approval,

reviewed,

nominated.During the reporting period,

invention patent applicationsfiled by the Company;

patent-dense products registered,including “Spin Finish” and “Stain-Resistant Nylon”As of 2024,

valid granted patents in total, including:

R&D patents,

patents in smart manufacturing

nationaland industry standards formulated or revised by the company,including :

national standards,

industry standards,

association standards.In 2024, the Company will invest about RMB

million in R&D.From 2019 to 2024,

distinguished professors from institutions,including Zhejiang University and Donghua University, have beenappointed as “Hengyi Scholars”.To help achieve the United Nations 2030Sustainable Development Goals (SDGs)

R&D and Innovation

The Company upholds the principle of “innovation-driven development to leadindustry progress.” We have strengthened the technological innovation systemwhile continuously improving R&D management. Strong emphasis is placed onresearch team development and talent cultivation, and we recruit high-caliberprofessionals and provide specialized skills training to build an industry-leadingR&D workforce.During the reporting period, our R&D investment reached about RMB 800 million,a year-on-year increase of about 3%. The number of R&D personnel totaled1,089, with master' s and doctoral degree holders accounting for about 22%. Boththe members and academic qualifications of the R&D team showed significantimprovement. We have assembled a team of technical experts, engineeringspecialists, postdoctoral researchers, and senior R&D engineers with expertisein the polyester fiber and chemical industries. This talent pool is strategicallypositioned to overcome R&D bottlenecks and pioneer cutting-edge technologies.To strengthen our talent strategy, we have established a “Distinguished Long-termResearcher” recognition program to reward key researchers for their endeavorsin core technology development. In view of the long cycle of R&D achievementtransformation, a dynamic interest adjustment mechanism is implemented torealize incentives in batches according to project progress. This e?ectively balancesresearchers' short-term needs with long-term value creation while sustainingcontinuous innovation momentum.We have persisted in developing eco-friendly ?ber materials. For example, we havelaunched several sustainable product lines including the environmentally friendlypolyester product “Eticont”, biodegradable polyester fiber “Petale”, TiO2Matting Agent for Nylon, and PTT composite ?ber. Our products meet the growingconsumer demand for sustainable lifestyle solutions.

Technologicalinnovation system

Green andinnovativeproducts

The Company has beenrated as a national high-tech enterprise in a total of

Among which new oneshave been recognisedin 2024

As of 2024

enterprises

enterprises

Eticont, developed by Hengyi Research Institute under the Company, stands as a polyesterproduct with full proprietary rights. Eticont uses a full titanium composite catalyst systemto replace heavy metal antimony catalysts, addressing the long-standing issue of water andsoil pollution associated with antimony catalysts in traditional polyester production. Thiseco-friendly, green, and health-conscious product achieves green circulation throughout thetextile product lifecycle.Petale biodegradable polyester naturally decomposes into harmless byproducts (water andcarbon dioxide) through microbial action in the environment. With its high degradation rate,it achieves complete biodegradation throughout the textile lifecycle from ?bers to yarns andfabrics, thus delivering a new sustainable solution for the textile industry.PTT composite elastic fiber is produced through bicomponent spinning of PET and PTTpolymers using bio-based PDO, resulting in an eco-friendly ?ber. The di?erential shrinkagebetween PET and PTT creates permanent helical crimps that provide inherent elasticity, andPTT's three-dimensional molecular spring structure ensures exceptional recovery properties.Hengyi Research Institute has successfully developed a series of proprietary spin ?nishes forFDY and POY applications through independent R&D. These formulations, with enhancedlubricity and ?ber ?exibility, optimize performance in key production stages from spinningto drawing and improve both product quality and manufacturing e?ciency.We focuses on the technical bottleneck of the matting agent in the application of Nylon 6,and we has partnered with Donghua University to create innovative production processes.We have successfully developed the green manufacturing of TiO2 matting agent forNylon and complete set of technologies for industrialization of Fully Matte Nylon. Ourproduct outperforms imported alternatives in key metrics, breaking long-standing foreigntechnology monopolies and reducing raw material costs for domestic nylon producers. Thisadvancement accelerates the sustainable, high-quality development of China's synthetic?ber industry.The product serves as a copolymer ?ame retardant, with stable, long-lasting and e?ective?ame-retardant performance. Boasting a good texture and appearance, it is water-resistanteco-friendly and non-toxic. Notably, the fabric achieves B1 level ?ame retardancy standardof GB8624-2012, with a limiting oxygen index over 32%. The product is widely applicable topublic space furnishings, such as curtains, wall coverings/draperies, bedspreads, etc.We use composite spinning technology to produce fibers with high thermal conductivityand a lower contact temperature, which meets the demand for comfort and coolness. Withstable cooling performance, the product e?ectively reduces energy consumption and thegreenhouse e?ect, and contributes to a low-carbon lifestyle.Stain-resistant PA6 stands out as a unique product developed with full proprietary rightsby Hengyi Research Institute. Addressing the pressing market demand for domesticstainresistant nylon fabrics, Hengyi embarked on the “key technology and industrializationproject for stain-resistant PA6”. This project has led to an independently developednovel stainresistant agent through formula design, optimized polymerization processes,and upgraded polymerization equipment. Consequently, we manage to produce in-situpolymerized stainresistant PA6 slices. Fabrics crafted from these slices offer permanentresistance to acidic dyes, eliminating the need for additional surface treatments.

Eticont

Petale

PTT composite ?ber

Spin ?nishsolutions forpolyester ?bers

TiO2 Matting Agentfor Nylon

Flame retardantpolyester

Cooling ?ber

Stain-resistant PA6

Leading Innovation-Driven Development with Science and Technology

As of 2024

Patent is the umbrella of enterprise innovation achievements, and also animportant embodiment of enterprise core competitiveness. The companyattaches great importance to intellectual property protection, throughoptimizing management mechanism, strengthening the awareness of all sta?,and effectively preventing risks. In 2024, there was no intellectual propertydispute or lawsuit.Through sustained R&D investment and innovation, we have systematicallydeveloped patent-dense products to generate continuous technologicalbreakthroughs. The Company's multiple core technologies have achieved industry-leading status, winning us recognition from both technical experts and regulatorybodies. This has translated into strong market acceptance of our product o?erings.Patent portfoliostrategyoptimization

Invention patent applications?led by the company

Valid granted patents intotal, including

Patent-dense products registered, including “SpinFinish” and “Stain-Resistant Nylon”

R&D patents

Patents in smartmanufacturing

45349

In 2024

RespectPatentAchievements

The patented preparation method for TiO

Matting Agent technology received the Excellence Award of the “2024Petroleum and Chemical Industry Patent Awards” and the ?ve Paper Awards from the China Chemical FibersAssociation-Hengyi Foundation for 2024.Easy-Clean Nylon won the second prize of Zhejiang Provincial Technology Invention Award.Five technologies, including the atmospheric low-temperature dyeable polyester ?ber with disperse dyes and PTTcomposite fiber, were included in the Green and Low-Carbon Technologies Compilation for the Textile Industry2024.Flame retardant polyester and nylon titanium dioxide matte slurry were listed in Zhejiang Province's ?rst batch ofnew materials for 2024.

In strict compliance with theIntellectual Property Right Management System, wehave enhanced protection through the revisedProvisional Measures for Trade

Secret Protection. Besides, a dual-track system that safeguards both patentsand trade secrets has been created to ensure comprehensive protection of coretechnologies and business con?dentiality.In 2024, we strengthened end-to-end IPR management by conducting thoroughprior-art searches and Freedom-to-Operate (FTO) analyses for all new projects,which effectively mitigated infringement risks and guaranteed regulatorycompliance for product launches. Moreover, we organized multiple specializedtraining sessions on “IPR Protection and Risk Prevention” for over 300participants. The sessions have signi?cantly enhanced R&D teams' awareness andproactive risk management capabilities.

IPR protection

The Company has fully implemented its digital transformation strategy,with a focus on “Smart Upgrade Driven by Digital Technologies” as thecore philosophy.By focusing on key areas such as smart manufacturing, full-process sales control, supply chain optimization, marketing innovation, andHR management，we have deepened data integration and intelligent scenariodeployment, established a highly efficient, collaborative industrial internetecosystem, and promoted the Company as a digital benchmarks in the industry.

DigitalTransfor-Mation

Functioning as our “smart brain”, “Hengyi Brain” fosters an integratedvisualization platform of “online trading, online finance, warehousing andlogistics.” The platform offers diverse digital solutions, including digitalmanagement, smart manufacturing, online trading, logistics services, marketanalysis, coordinated production, supply and sales, as well as supply chainfinance. Our aim is to enhance the management efficiency of production andoperation, and achieve digital transformation and improvement.

Hengyi Brain

The sales data full-process system centers on customer service. By integratingsystems like micro mall, closed-loop marketing, shipment commissioning, andshipment applications, the system has enabled fully automated and collaborativeoperations from order placement to shipment. It enhances sales efficiency,accuracy, and customer satisfaction, and provides robust support for businessgrowth.

Intelligent salessupply chain system

Leading Innovation-Driven Development with Science and Technology

The Company actively responds to national strategic requirements ontechnological innovation and standardization. As an industry leader, we playan exemplary role by participating in the development of both internationaland industry standards. By promoting the widespread adoption of advancedtechnologies and sharing our innovations, we aim to drive the elevation of theindustry's overall technical capabilities.

We have consistently driven the digital and intelligent transformation of ourfactories. The entire product lifecycle, encompassing all processes from rawmaterial procurement and transportation, automatic drop-off production,automatic intelligent external inspection, automatic packaging and automaticwarehousing is realized through digitalization.

The system focuses on park logistics management, and its core functionsincluding vehicle management, dispatch control, warehouse operations, ?nancialmanagement, and statistical reporting, are all integrated with comprehensivesafety management throughout. In addition, large-screen dashboards, voicealerts, and real-time noti?cations also help optimize driver activity, improve cross-system coordination, and enable e?cient factory-wide management through dataintegration.

Industry standardestablishment

Smart factorydevelopment

IT-based logisticsmanagement

IndustryExchanges andCooperation

New industry standardswere released

Additional standardssubmitted for approvalReviewedNominated4759

In 2024

Relying on various scienti?c and technological innovation platforms, including theZJU-Hengyi Global Innovation Research Center, the Joint Laboratory of DonghuaUniversity and Hengyi, China Chemical Fibers Association-Hengyi Foundation,and the National Postdoctoral Research Station, Hengyi actively strengthenscollaboration with universities and research institutions. Relying on strongpartnerships with leading academic institutions such as Zhejiang University,Donghua University, and Zhejiang Sci-Tech University, we have established anintegrated industry-academia-research-application mechanism. This mechanismaccelerates the translation of research into practical applications while developingtalent, and delivers both technological innovation and resource support to theindustry.The Hengyi Scholars Laboratory focuses on multiple research areas, includingcatalytic materials and projects addressing China's key national strategic needs.The laboratory brings together top-tier domestic and international scientists,outstanding young researchers, and substantial research resources. From 2019 to2024,six distinguished professors from institutions, including Zhejiang Universityand Donghua University, have been appointed as “Hengyi Scholars,” providingongoing first-class academic guidance and technical support. In 2024, DonghuaUniversity's Professor Wang Huaping became the sixth appointee to this prestigiousposition.

Hengyi Scholars Laboratory

In-depthuniversity-enterpriseintegration

As of 2024National and industry standardsformulated or revised by the company

Including nationalstandardsIndustry standardsAssociation standards5113308

Engagement ceremony of “Hengyi Scholars”

Leading Innovation-Driven Development with Science and Technology

治理领航 夯实发展根基

EarningCustomer Trustwith Quality

Guided by the “customer-first” philosophy, Hengyi prioritizesquality excellence, customer rights protection, and strengthenedsafety responsibility. At the same time, we adhere to sunshine andtransparent procurement, and build a mutually beneficial andwin-win supply chain system.

Invested in productionsafety RMB

Quali?cation rate ofsafety trainingmillion%

169.49100

2024 Actions and Responses

To help achieve the United Nations 2030Sustainable Development Goals (SDGs)

Safety Responsibility

The Company strictly complies with national and localregulations, including theWork Safety Lawand the

Regulations on the Safety Administration of HazardousChemicals,and consistently updates internal safetypolicies and operating procedures, such as the

Environmental and Safety Assessment Measures, SpecialOperations Management Regulations, andProvisions onthe Administration of Fire Work Safety.Concurrently, wepromote work safety standardization initiatives acrossall subsidiaries. By the end of the reporting period, fiveof our subsidiaries had achieved Level 3 certificationin work safety standardization, one had achieved Level2 certification, and another one had achieved Level 1certi?cation.

Work safetymanagement

Zhejiang Yisheng, a subsidiary of the Company,has implemented a comprehensive Process SafetyManagement (PSM) system. Through its fourth-roundcontinuous improvement program, the subsidiary hasstrengthened PSM competencies in safety informationmanagement, risk control, and change management.These ongoing enhancements to safety procedureshave significantly advanced its safety standardizationcapabilities.

The company has established an HSE safety committee, chaired by the chairman of the committee,and set up HSE leading groups in each subsidiary to continuously establish and improve the HSEresponsibility system. Through the convening of the annual HSE meeting, we will comprehensivelypromote the signing of safety and environmental protection target responsibility letters at alllevels, implement the "one-vote veto system" for major accidents, and execute them at all levels,thereby achieving full-level coverage of the responsibility system "horizontally to the edge andvertically to the end", and promote the orderly development of safety production work.

Zhejiang Yisheng conducts fourth-round PSM continuous improvement program

Construct asafety productionorganisationsystem

Case

Hengyi Logistics's Level 1certi?cate for work safetystandardization

PSM change management training

2024 HSE target agreement signing ceremony

The Company has fully implemented digital transformation of its dual-prevention mechanismthat combines hierarchical risk control with hazard identi?cation and management. The “Four-Color Risk Mapping” system has boosted our risk identi?cation and tiered control measures,and helped us update our risk database. Concurrently, we have adopted a dynamic riskassessment protocol to e?ectively prevent potential safety incidents.Safety riskmanagement

The Company attaches great importance to emergency management, and strengthensresponse capabilities through initiatives, such as team development, procedure and processoptimization, implementation of the “1+N” emergency plan framework, emergencydrills, and the provision of adequate equipment and supplies. Constant improvement inour preparedness and crisis response has driven the modernization of our emergencymanagement system and capabilities.

Safety emergencymanagement

Safety emergency drills

Participantstimes20314,341

In 2024

Emergency teamdevelopment

The emergency command center has been established. It comprises specialized teamsincluding the emergency coordination team, rescue & recovery team, medical supportteam, and logistics support team.We have developed the Emergency Incident Response Procedures, which outlinesoperational standards for the four phases of early warning, response, containment, andrecovery.A “1-hour reporting mandate” has been implemented to ensure that all emergencies arereported to the emergency command center within one hour of occurrence.One comprehensive emergency response plan.Specialized contingency plans covering natural disasters, industrial accidents, publichealth emergencies, and social security incidents.Role-specific emergency response cards with supporting on-site incident managementprotocols.

Emergencyprocedures andprocesses

Emergencyplandevelopment

Tabletop simulations and live-?eld exercises.

Emergencydrills

Zhejiang Yisheng conducts an emergency response drillfor an oxidation-induced leak and ?re scenario in itsquadruple pipeline system

Hengyi Logistics carries out a tra?c accident emergencyresponse drill

Earning Customer Trust with Quality

Hazard identification and treatment is a critical component of work safety. Wehave updated the Provisions onthe Administration of Identi?cation and Treatmentof Hazardsto enhance our routine hazard inspection system, with a focus on ?reprotection systems and machinery hazards. Once risks are identified, we keepdetailed records and enforce a “closed-loop tracking system” (assigning clearaccountability and remediation timelines). Supported by rigorous follow-up audits,we verify full corrective action implementation.

Hazard identi?cation andtreatment

During key safety campaigns such as the “Work Safety Month” and “11.9National Fire Prevention Month,” we conduct comprehensive, multi-level safetyeducation programs. To reinforce our safety culture, we leverage safety culturewalls, work safety management manuals, “Daily Safety Tips” posted on theCompany's WeChat o?cial account, and safety alert videos displayed on workshopdigital screens. These efforts enhance organization-wide safety awareness, andfoster a robust safety culture.

Safety culturedevelopment

Safety inspectionsIdenti?ed

Recti?cationcompletion rate

%4,51413,705100

In 2024

Safety training per trainee

Safety training

Pass rate of safetytraining

New employeesengaging in threelevels of safety training

hours (non-hazardouschemicals)

hours (hazardouschemicals)

sessions

participants

%

13,383

In 2024

Conducting a training session themedon “Safety Awareness and EmergencyResponses across the Workforce”

Conducting specialized HSE trainingto strengthen management'sunderstanding of regulatorycompliance obligations and safety/environmental principles

Jiaxing Yipeng wins the second prize at Xiuzhou District's 13thFire Safety Competition.

timeshazards

The Company abides strictly by national regulations such as theRegulations on the SafetyAdministration of Hazardous Chemicalsand theRegulations on the Administration of PrecursorChemicals.We continuously improve our internal safety management systems and processes,including theChemical Management Procedures, Chemical-Specific Risk AssessmentChecklists,andHazardous Chemical Safety Data Sheets.Concurrently, we have establishedclear protocols and methods for chemical procurement, storage, and transportationmanagement to ensure strict control throughout the entire chemical lifecycle.

Chemicals safety management

Major chemical leaks orother safety incidentsoccurred

Chemical safety management measures

In 2024

Chemical suppliers must possess theHazardous Chemical Operation Licenseand provide compliant MSDS(Material Safety Data Sheets) and standardized product safety labels.For new suppliers, on-site assessments of their warehousing conditions and transportation capabilities arerequired.Chemical procurement requests shall be submitted through the ERP system for the EHS departments'countersignature.Procurement of unassessed chemicals which are not listed in theChemical Inventory Registry is prohibited.Segregated storage:

Chemicals must be stored according to their physicochemical properties (e.g., ?ammables in explosion-proof cabinets and corrosives in isolated areas). Incompatible materials must be strictly separated (e.g., acidsand bases, oxidizers and reducers must not be stored together).Storage conditions:

Storage areas must be equipped with temperature/humidity monitoring, ventilation systems, and leakcontainment measures (e.g., spill berms, absorbent sand). The maximum storage volume must not exceed80% of the designed capacity.Inventory control:

A “two-person, two-lock” system governs chemical inventory access. Logs must include timestamps,quantities, and the name of the person handling the materials. Regular audits ensure physical stock matchesrecords, with MSDS and usage logs strictly maintained.Operators must receive specialized training and wear personal protective equipment (PPE), including chemicalgoggles and chemical-resistant gloves.Permit-to-work authorization is required for high-risk operations (e.g., chemical dispensing, heating), underdedicated supervision by competent personnel.Chemical waste shall be segregated (waste liquids and containers separately collected). Hazardous wastelabels must display composition, hazard class, and hazard information. Disposal must be conducted bylicensed contractors. Waste manifests shall be retained for a minimum of 5 years.Direct discharge into drainage systems and mixed storage of incompatible wastes are prohibited.Spill response kits (containing appropriate absorbents and neutralizing agents) shall be available in workareas.Internal transfer:

Chemicals shall be transported using explosion-proof forklifts or dedicated carts, with routes avoiding high-occupancy areas. Container integrity shall be inspected, veri?ed, and properly secured prior to movement.“Fragile - Handle with Care” labels shall be prominently displayed.External transport:

Carriers shall possess valid hazardous materials transportation certi?cation. Vehicles must be equipped withGPS tracking systems and emergency response equipment. All shipments must be accompanied by MSDS,safety labels, and transport emergency cards.

Chemicalprocurementmanagement

Chemical storagemanagement

Chemical usage anddisposal

Chemicaltransportationmanagement

Earning Customer Trust with Quality

times

In compliance with national laws and regulations, including theWork SafetyLawand theContractor Safety Supervision and Management Measures, we haveestablished ourContractor Safety Management Measures.We rigorously assesscontractor qualifications, sign safety agreements with each contractor, and holdmonthly safety meetings. Furthermore, we conduct regular specialized safetyinspections. Safety evaluations based on internal regulations are conductedtargeting violations, and we ensure contractors comply with operational safetystandards.

Contractors must submitbusiness licenses, work safetypermits, and special operationpersonnel quali?cations.For high-risk operations (e.g.,working at heights, or confinedspaces), additional documentssuch as specialized constructionplans and emergency responseplans are required.

The Company signs theWorkSafety Management Agreement

with each contractor, clearlyoutlining safety responsibilitiesand risk deposit obligations.

Contractors involved inaccidents or found concealingsafety hazards will beblacklisted and barred fromcooperation for three years.

Contractor safety management process

Contractorsafetymanagement

Product Quality

Adhering to applicable laws, regulations, and industry standards, we haveupdated theInternal Quality Control Standard for Chemical Fiber Productsandimplemented a comprehensive quality management system to standardize end-to-end quality control and mitigate risks. All 9 of our subsidiaries have been certi?edby the ISO 9001 Quality management system and the EU OEKO-TEX. Embracingstrict guarantee that our products do not contain hazardous substances and heavymetals above standards, we are committed to delivering products that meet globalenvironmental standards.

Pass rate of outgoinginspection

%

In 2024

Safetyagreementsigning

Blacklist

policySafetyquali?cationreview

The Company has formulated theInternal Quality Control Standard for Chemical FiberProducts, proposing clear requirements for strict control over physical properties of chemical?ber products. We track, spot check, and manage product quality metrics to ensure that ourproduct quality is under control and meets customer expectations for high-quality products.Exercisingstrict controlover productquality

We has fostered a conducive environment for high-quality products. To make relevant personnelput more emphasis on product quality, we conduct regular audits of our quality managementsystem. Through specialized technical training, operational workshops, QC group activities,and internal skill competitions, we engage all employees in our quality improvement initiatives,reinforcing their quality awareness.Quality culturebuilding

Quality control of raw materials: We formulate acceptance standards for raw and

auxiliary materials, and conduct on-site testing and strict acceptance of all raw andauxiliary materials. At the same time, we has established an exclusive OA processof "D1014-Quality Feedback Process for Purchased Materials" to address abnormalfeedback of raw materials in a timely manner.

Process control of product production: We builds a big data platform, the factory

establishes a data ledger, and monitors the product process control throughe?ective means such as kanban on site. At the same time, we has established anexclusive D1310- Change Process for Inspection Index Central Value of ChemicalFiber Products to oversee the entire product process.Output control of unquali?ed products: We establish a Non-Conforming ProductFeedback Process and a D0941-Product Quality Evaluation Process to promptlyevaluate products of abnormal quality and control the output of unqualifiedproducts.

According to the product quality standards, the products are divided into threegrades: excellent products (AA), ?rst-class products (A) and quali?ed products (B),and those that are lower than the quali?ed products are foreign products (C).

Specialized technical training and internal skill competitionAn employee skill training and competition

session of Zhejiang Yisheng

Earning Customer Trust with Quality

We regularly conducts supplier performance assessments, and divides them intodi?erent levels and provides incentives based on the assessment results. In 2024, wepunished 65 suppliers with negative incentives, suspending the quali?cation of 33 andissuing warnings to 32 of them. Through these negative incentives, we ensure strictmanagement of suppliers according to the law.

Supplier assessment

By establishing comprehensive supplier management systems and protocols, suchasMeasures for the Quality Management of External Suppliers, Supplier AdmissionRequirements, Measures for Supplier Inspection, Measures for Supplier FlightInspection Management,andRegulation on Supplier Admission Management, alongwith the support of the Supplier Relationship Management (SRM) system, we regulatesupplier access, assessment, etc. throughout the lifecycle of supplier management toreduce supply chain risks.Suppliermanagement

ResponsibleSupply Chain

The number ofsuppliers reached

Registration

Supplier basic information reviewDetermination of on-site inspectionTrial if necessaryTrial periodInitiation of admission approval process

Quali?ed supplier

On-site inspection

8,561

In 2024

We has created a comprehensive supplier admission process. For suppliers undergoingadmission inspections, we mainly review their business qualifications, purchasedparts and raw materials, production equipment and capacity, product quality,environmental compliance, etc. At the same time, the supplier's ESG performance istaken into consideration. Speci?cally, we include the supplier's quality managementsystem, environmental management system, occupational health and safetymanagement system, environmental impact assessment pass rate, and acquisition ofthe pollutant discharge permit into bidding and procurement quali?cation processes,and an inspection report is issued for the on-site inspection of the supplier, ensuringcompliance and transparency of the admission process. In 2024, the Companyadmitted 3,001 suppliers and inspected 308 suppliers.

Supplier admission

SuperiorServices

Equipped with a sound after-sales service guarantee system, we proactivelygather customer needs and feedback through after-sales visits, follow-up calls,and satisfaction surveys. We have built up customer complaint channels, such asHengyi Micro Mall and the 400 hotline, to ensure e?cient reception and resolutionof customer complaints, and promptly offer technical services and respond tocomplaints. In 2024, the Company distributed the 2024 Customer SatisfactionSurvey via Hengyi Micro Mall, which showed a 99% customer satisfaction rateaccording to the 1,859 completed questionnaires.

Supplieradmission

process

We advocate that suppliers use clean fuels and production equipment, aiming to minimizeenvironmental pollution. Moreover, we encourage our suppliers to consider environmental andsocial impacts. In addition, as great importance is attached to anti-fraud work, the Company signstheAnti-Commercial Bribery and Integrity Agreementwith procurement sta? to prohibit any formof corruption, bribery, etc.We sets a complaint feedback platform and discloses the complaint reporting hotline of theaudit and legal department on desks where ourSunshine Procurement Agreementand biddingdocuments are signed and on desks of the procurement department. These e?orts help us respondto complaints and feedback as soon as possible.Complaint hotline: [phone]; complaint email: [e-mail]

Responsibleprocurement

The Company is committed to fostering a stable and enduring supplier network with an open,cooperative, and mutually beneficial approach. By implementing a system of recognition andrewards, we aim to instill a sense of honor among our suppliers and enhance their loyalty, andrealize shared growth.

Suppliercommunication

Integrity promotion targeting procurement sta? and suppliers

In the hydrocracking maintenance project of Zhejiang Yisheng and Hengyi Brunei, 26 supplierswere awarded the Outstanding Contribution Award and received letters of appreciation inrecognition of their e?orts.

Earning Customer Trust with Quality

治理领航 夯实发展根基

GrowingTogether withEmployeesHengyi is deepening its "Talent-Driven Enterprise" strategy, focusingon cultivating a high-quality talent team. Simultaneously, thecompany prioritizes employees' occupational health and safety,creating a work environment that fosters physical and mentalwell-being through health training initiatives. This approachenhances team cohesion and cultural identity, fosters a harmoniousatmosphere, and ensures shared developmental achievements withemployees.

%

480.935.2

2024 Actions and Responses

To help achieve the United Nations 2030Sustainable Development Goals (SDGs)

millionbillionPass rate of safety training

Accumulated purchase underthe ESOP

Amounting to RMB

Employees' Rights and Interests

The Company strictly complies with theLabor Law, the Labor Contract Law,andother relevant regulations, as well as internal employment management measuressuch as theRecruitment and Employment Management Measures and the LaborContract Management Measures.Accordingly, we have established detailed standardsfor employee recruitment and promotion,compensation and benefits, and equalemployment. We also ?rmly oppose all forms of employment discrimination to ensurethat every employee enjoys equal opportunities for development.

The Company has established theCompensation and Benefits Systemwhilecontinuously improving employees' working conditions and welfare safeguards.

Recruitment andemployment

Employee bene?ts

Employees in total

Labor contract signing rate

Proportion of femaleemployees

Females in seniormanagement

Females in middlemanagement

%

%16,014

263180

We implement a wage negotiation mechanism, execute scienti?c planning for salary

growth, and consistently enforce total compensation controls, ensuring a steady pay

raise for front-line employees.

We ensure all social insurance are made on time and in full, and provide employees

with multiple insurance plans, such as employer's liability insurance, group accident

insurance, employees' medical mutual aid, and supplemental medical insurance. The

social insurance coverage rate for our employees has reached 100%.

We standardize operating procedures and enhance smart manufacturing to reduce

the labor intensity of production front-line employees while effectively protecting

employees' rights to take rests and ask for leave, especially front-line employees.

Remuneration and bene?ts

Social insurance

Labor security

In 2024

In 2024

5,383

1,933

4,887

3,811

Under 29 years old

30-39 years old

Over 50 years old

40-49 years old

AgeDistribution of

Employees

We actively optimize democratic management through institutionalized, standardized, andlegally-compliant efforts, with continuous improvements to our workers' congress system. Ourdiverse channels for democratic communication—incorporating workers' congress, symposiums,questionnaire surveys, mailboxes, and our WeChat official account and videos—ensure timelyresponses to employee concerns. In addition, we continuously improve the “Hengyi Seniors”grass-roots political committee mechanism to engage directly with front-line employees, gatherconstructive suggestions, and e?ectively safeguard employees' rights to information, participation,expression, and oversight.

Democraticmanagement

In 2024, Hengyi's production subsidiaries, while advancing workforce efficiency enhancement initiatives, are piloting a"shared contracting" mechanism. This approach energized employees through work sections or production lines contractingwhile driving labor e?ciency via waste reduction and workforce optimization. The resulting cost savings are then rewardedto employees as contracting allowances, enabling performance-based earnings for front-line workers—with top performersachieving over RMB 1,000 in additional monthly income. Additionally, we continuously conduct employee skill assessmentsto fully explore and enhance employees' professional competencies. Through these e?orts, we not only elevate employees'skill-based pay and overall pay satisfaction, but also solidify the foundation for sustainable corporate growth.

Employee total compensation package mechanismCase

Labor union participationCollective contract signing rate

%%100100

Beyond o?ering various bene?ts for holidays, birthdays, and work anniversaries, we create specialinitiatives—from International Women's Day celebrations to children's summer camps, educationalprograms, and Children's Day family activities—all designed to enhance female employees' sense ofbelonging, ful?llment, and happiness.We o?er housing allowance, canteen and meal subsidies, workwear, free shuttle buses, and other lifesupport for our employees, and help non-locals settle down to facilitate school enrollment for theirchildren.In 2024, the company implemented the sixth-phase Employee Stock Ownership Plan (ESOP),acquiring a total of 114,090,297 shares ，representing 3% of its total equity. This initiative bene?ted2,500 employees, enabling them to share in the corporate development achievements.

Holiday bene?ts

Life support

Equity incentives

In 2024

Growing Together with Employees

OccupationalHealth andSafety

In accordance with the Law on thePrevention and Control of Occupational Diseases

and other relevant regulations, the Company has formulated and improved theRegulations on the Occupational Health Management. We strictly implementthe national standards for occupational health and carry out the whole-processmanagement from occupational disease protection during the project constructionperiod to detection of occupational hazards, occupational health checkups, issuanceof labor protective equipment, training and education, etc. During the reportingperiod, our 9 subsidiaries have passed ISO 45001 Occupational Health and SafetyManagement System Certi?cation, ensuring the protection of employees' occupationalhealth and safety.

We set up a drugstore in the office area where all common medicines are prescribed and all kinds of healthmonitoring instruments such as blood pressure meters for the production workshop are distributed.Regularly conducts pre-employment, in-service, and post-employment occupational health check-ups; organizeshealth lectures and free medical consultation activities.According to the needs of di?erent positions, the company issues targeted protective equipment, and supervisesthe wearing situation every day.Regular testing is conducted for noise, dust, toxic substances, etc., with dynamic risk assessments, and the results arerecorded in occupational health records to ensure comprehensive implementation of employee health management.

Cases of Occupational Disease

The company focuses on occupational health initiatives

OHS Participation

Physical Examination CoverageHealth & Safety Training Coverage%%

%%

0100

In 2024

Taicang Yifeng, a subsidiary of Hengyi, participated in and won awards at both the Work Injury Prevention & Labor ProtectionSkills Competition as well as the Occupational Health Expertise Skills Competition.

UnblockedGrowthChannel

The Company prioritizes talent training as a core strategy and offers diverse careerpaths. Our commitment lies in creating a comprehensive talent pool and providing anoptimal environment for professional growth, where every employee can realize theirfull potential.

The Company actively implements “Blue Series” training programs—includingNew Blue, Deep Blue, and Sky Blue—to intensify structured training for new hires, keytalents, and newly promoted managers. Through Hengyi University's online platform,we deliver flexible training solutions that adapt to individual needs. Focusing ondeveloping a skilled workforce, we comprehensively enhance employees' professionalcompetencies and management capabilities by o?ering vocational aptitude tests andgrass-roots industrial management training. Through these e?orts, we ensure strongtalent support for the Company's high-quality development.

Building a strongtalent pool

Annual training hours per employeeTraining coverage rate

hours%120100

In 2024

The company cultivates multinationalskilled talents through joint talentdevelopment programs such as “UBD-ZJU-Hengyi" "IBTE-LPUVT-Hengyi" "Hengyi- Politeknik Brunei". To date, over 1,000professionals have been trained throughthese collaborative programs.

Hengyi Univesity's online platform has beenoperating for 7 years, with more than 5,000learners and 370 courses covering variousdimensions such as professional competence,leadership and management, general ability,and professional knowledge. Our employees'online learning hours have exceeded 40,000hours.

The company leverages its industrial aca-demy as a talent hub, integrating internal-and external resources to deliver brandedtraining programs such as"Industry Lectu-re Hall", "Lean Classroom" and other ?ags-hip courses. These initiatives comprehensi-vely enhance frontline supervisors' capabil-ities, thereby driving the overall competencyupgrade of the technical workforce acrossthe industrial chain.

In 2024, our New Blue Program onboarded and developedover 300 new hires, while the Deep Blue Program trained40 high-potential managers from various business units.

The company has introduced thePolyesterSector Skill Grading Management Regulations,establishing standards and proceduresfor skilled personnel certification, andsystematically conducting internal employeeskill assessments. As of now, the company hascertified a total of 1,585 advanced workers,279 technicians, and 10 senior technicians.

Multinational Talent JointDevelopment Program

Hengyi University's Online PlatformIndustrial grass-roots management training

“New Blue-Deep Blue-Sky Blue” Programs

Vocational Aptitude Test

Growing Together with Employees

Opening up careerdevelopmentchannels

The Company provides employees with a diversified career development platformthrough three parallel advancement tracks—managerial, professional, andoperational—supported by a structured job grade system, offering clear growthtrajectories tailored to di?erent positions. We develop fair and transparent evaluationmechanisms to ensure equitable career progression for all, which empowersemployees to achieve professional breakthroughs in step with the Company's growth.

New Blue Program

Sky Blue ProgramVocational Aptitude Test

Skill Competitions

Warm Care forEmployees

The Company creates a warm workplace based on a “family-oriented culture”covering team building, seniority, workers' family and dormitory. Our year-roundengagement program—spanning holiday care activities, events for employees'children, and anniversary celebrations—fosters a cohesive cultural ecosystem andtransforms the workplace into a nurturing harbor where professional aspirationsand personal ful?llment thrive together.Organizing diversi?ed activitiesCase

Employee induction commemoration activityInternational Women's Day craft activity

Polymer Company, a subsidiary of Hengyi, organized the “Riding the Wave of the Future · Growing Together”summer camp for employees' children.

Partnering with CITIC Bank, we organized the“Little Bankers” educational program. Duringthe activity, children explored various bankingservice zones and participated in hands-on?nancial literacy simulations along with a cash-counting contest, creating valuable bondingexperiences for employees and their children.

Hengyi Research Institute, a subsidiary of the Company,participated in the “Technology Soars, Badminton Unites”2024 First Xiaoshan District Badminton Competition for Scienceand Technology Workers and achieved fourth place in the teamevent

Growing Together with Employees

治理领航 夯实发展根基

Building aHarmoniousCommunity with aShared FutureWith a long-term commitment to social well-being, the Companyactively supports community development through concrete publicwelfare initiatives and diverse philanthropic programs.2024 Actions and Responses

By year-end 2024,the Company hadconducted blooddonation drivesMobilizingBlood

donorsmilliliters

5,8821,657,341

1,000The company has created localjobs in Brunei nearlymillion

times

28.77

In 2024, the company andits controlling shareholderHengyi Group collectivelydonated RMB

To help achieve the United Nations 2030Sustainable Development Goals (SDGs)

Rural Vitalization

Serve community development

The company actively responds to the call of the national strategy, and consciously engages in the cause of rural vitalisation, andconducts long-term educational donation activities, thus practising social responsibility and corporate responsibility with practicalactions.

The Company fully utilises its own resources and professional advantages, and actively integrates into the construction anddevelopment of local communities by participating in various public welfare activities such as volunteer service, community co-construction, and environmental protection.

The " Dream Class " is a " Education Targeted Poverty Alleviation " project strongly supported by the EducationDepartment of Guangxi Zhuang Autonomous Region. It selects the best classes in the demonstration ordinary highschools in the whole region to subsidize the poor high school students with both excellent quality and learning. In 2024,all 50 students from the 2021 " Dream Class " of Qinzhou No.2 Middle School, funded by Hengyi, were admitted to theundergraduate college, of which 29 were admitted to the " 985 " and " 211 " colleges and universities, which lit up thedream of learning for the poor students.

Educational Donations Give Wings to Underprivileged Students' DreamsCase

The “Heng Employee Hub,” developed by the PartyCommittee of Hengyi's Linjiang Base, serves as amultifunctional cultural and recreational center foryoung employees. Combining cultural activities, ?tnessfacilities, entertainment spaces, social areas, andchildcare services, this community Party-mass servicestation has evolved into a welcoming gathering placefor both Party members and company sta?.

Co-building the “Heng Employee Hub”Case

Various activities organized at the “Heng Employee Hub”

PhilanthropyThe development of the company is inseparable from the support ofthe society. Through the establishment of special funds such as thecharity fund for civilized practice in the new era and the charity fundfor " Common Prosperity, Happiness Home, " the company gathersthe power to give back to the society wholeheartedly.

million

28.77

Zhejiang Yisheng organizes a charity donation ceremony

Fujian Yijin, one of the Company's subsidiaries, contributes donations to support education and elderly care initiatives toimprove teaching facilities and enhance welfare for senior citizens

Zhejiang Yisheng hosts a skills demonstration event anddonation ceremony for the local safety workshop in theIndustrial Community of Qijiashan Sub-district.

The company and its controlling shareholderHengyi Group collectively donated RMBIn 2024

Building a Harmonious Community with a Shared Future

Contributionto the BRI

Promotinglocal marketdevelopment

Hengyi strategically cultivates spin-off business opportunities by activelydiversifying into sectors including logistics, catering, and operational services.This economic ripple effect generates amplified local commercial prospects,stimulating enterprise growth across communities. Through leveraging itsprofessional expertise, we concentrate on Brunei and neighboring regions'strategic development footprint, intensifying local procurement while prioritizingcontractor training programs. Our deepened commitment to localized operationsreinforces supply chain integration, entrenching our presence through community-anchored development practices.

We actively advance the Belt and Road Initiative. By establishing a Corporate SocialResponsibility (CSR) Committee and a special-purpose fund in Brunei, we maintainsustained commitments to three flagship initiatives—"Hengyi Future-Focused,""Hengyi Compassion in Action," and "Hengyi One Earth"—driving progress in localeconomic development, talent empowerment, and quality-of-life enhancementsfor Brunei's communities.

The Company's operations in Brunei

房屋租赁

OverseasPhilanthropicInitiatives

The company actively carries out various forms of public welfare activities inBrunei, such as fun running, loving blood donation, student donation and so on.From educational support to life assistance, we continues to contribute to the well-being and sustainable development of the local community.

On March 29, 2024, the Company organized a donation campaignduring Ramadan, through which we donated funds and essentialgoods to underprivileged families and the Dana Pengiran MudaMahkota Al-Muhtadee Billah for Orphans (DANA). The campaignpromoted community co-building while fostering solidarity, care,and inclusivity across local communities. In total, we donated BND7,800 in cash and food supplies to 13 disadvantaged families, alongwith a BND 5,000 charitable contribution to DANA.

Organizing a donation campaign during RamadanCase

Logistics

Financing

Catering

House rental

Security services

Operational services

Construction

Consulting services

As a flagship project under the BRI in Brunei, the PMB refinery and petrochemical project has been hailed as “thekey to unlocking Brunei's industrialization.”It stands as Brunei's largest industrial investment to date and the biggestoverseas investment by a Chinese private enterprise. Notably, it is also the ?rst overseas re?nery project built entirely toChinese standards. Its successful technological upgrades have ensured sustained pro?tability, contributing signi?cantlyto Brunei's “Wawasan 2035” as well as bilateral economic and trade cooperation. To date, the Phase 1 project hasachieved full-capacity production with seamless operations, while Phase 2 is progressing steadily in all aspects.

Hengyi Industries Sdn Bhd's project included in joint statementagain, outlining the blueprint for bilateral cooperationCase

Local talentscultivation

In addition to providing numerous job opportunities in Brunei, the Company prioritizesthe organization of local talent cultivation programs. We have specifically promoted theestablishment of three specialized talent development programs, and offered talentdevelopment and incentive programs for local Bruneian students, such as full scholarships,student awards, and Bookworm prizes. We actively connect with communities through careerfairs, vocational exhibitions, and school outreach programs, showcasing Hengyi's supportfor local education and job opportunities while nurturing the next generation of talents forBrunei's growing chemical industry.

The company hascreated local jobs inBrunei nearly

Hengyi Industries Sdn Bhd's PMB Phase 1 project

Hengyi Industries Sdn Bhd Host The 2nd Annual Employee Appreciation Ceremony

In 2024

Building a Harmonious Community with a Shared Future

1,000

On February 15, 2024,Hengyi held a scholarshipand employment signingceremony with UniversitiBrunei Darussalam (UBD),Politeknik Brunei (PB), andInstitute of Brunei TechnicalEducation (IBTE). During theevent, 20 UBD students signedscholarship agreements, while145 PB and 35 IBTE studentsentered into employmentcontracts with the Company.

Scholarship awards and employment contract signing ceremonyCase

Scholarships and joint training programs

UBD-ZJU- HengyiScholarship Program

IBTE-LPUVT-HengyiScholarship Program

PB-LPUVT ScholarshipProgram

The UBD-ZJU Joint Academic Program, designed for freshmen enrolled inthe Faculty of Chemical Engineering at UBD, has admitted 11 cohorts witha cumulative enrollment of 196 students as of the reporting period.Notably, 137 graduates have secured employment through this initiative,demonstrating its robust industry alignment.

The IBTE-LPUVT Joint Academic Program has admitted 5 cohorts witha cumulative enrollment of 145 students as of the reporting period.Notably, 124 graduates have secured employment through this initiative,demonstrating its robust industry alignment.

Hengyi, in strategic academia-industry collaboration with IBTE and PB,has developed 8 specialized programs targeting petrochemical andrefining disciplines. These industry-aligned curricula have attracted 589enrolled students to date, with 269 graduates successfully transitioning intoprofessional roles.

Prospects

Prospects

At this pivotal juncture where Hengyi Petrochemical stands at the mid-century mark ofits "Centennial Hengyi" journey, the company will steadfastly implement its "One Dropof Oil, Two Strands of Filament" development strategy. We will accelerate the strategictransition from "Industrial Hengyi" to "Technological Hengyi", consolidate our sustainabledevelopment foundations, demonstrate leadership in environmental stewardship, socialresponsibility, and corporate governance (ESG), thereby driving transformative progressin the petrochemical industry and contributing substantively to global sustainabledevelopment.We will work to enhance our modern governance system on an ongoing basis, andcontinuously strengthen compliance management and risk resilience. By closely integratinginformation disclosure with investor relations, brand development, and related initiatives,we will further improve corporate governance e?ciency, thereby delivering long-term, stable,and sustainable performance and maximizing value for shareholders and all stakeholders.Aligned with China'carbon peaking and carbon neutrality goals, we will systematically chartour low-carbon development pathway. Through technological innovation, equipmentupgrades, process optimization, and low-carbon product development, we will unlock ourcarbon reduction potential to support industry and supply chain decarbonization, and striveto lead the petrochemical sector in achieving carbon neutrality.We will persist in driving corporate development through innovation, continuouslyincreasing investment in scienti?c and technological research and development guided by"green manufacturing" and "circular economy," while enhancing the conversion e?ciencyof new materials and technologies. Concurrently, we will deepen the digital transformationstrategy to meet the growing demand for intelligent logistics technologies, accumulatingmomentum for sustainable development.We will steadfastly adhere to the safety baseline, rigorously enforce safety management,strictly control product quality, optimize customer service, and earn consumer trust andmarket recognition through high-quality products and superior services.We will remain committed to caring for the work and life of every employee, striving tobecome their most reliable support and caring partner. Additionally, we will provideabundant learning resources for employees at all levels, empowering them to fully utilizetheir expertise in their roles, thereby continuously achieving the positive and sustainabledevelopment of corporate talent.We will continue to fulfill our social responsibilities by expanding community volunteerprograms and increasing philanthropic investments and community engagement. At thesame time, we will actively participate in the Belt and Road Initiative, supporting Brunei's“Wawasan 2035” and fostering international economic and trade cooperation.

Appendix

ESG Key Performance

Economic

Social

billionbillion10,000 tons/ year10,000 tons/ year10,000 tons/ year10,000 tons/ year10,000 tons/ year10,000 tons/ year10,000 tons/ year10,000 tons/ year%%

headcount%%%%headcount

136.1

4,162

2,150

15,548

125.5

107.5

4,335

2,150

16,014

Indicator

Indicator

Unit

Unit

2023

2023

2024

2024

Operating incomeTotal assetsProduction capacity- Chemicals- Re?ned oil products-PTA-PIA- Polyester ?ber- PET（including RPET）- CaprolactamQuality inspection pass rateCustomer satisfaction after sales

Total number of employeesPercentage of female employeesLabor contract signing rateSocial insurance coveragePercentage of ethnic minorities employeesFemale in senior management

Indicator

Appendix

521.50

0.006

1,8673,646

399.89

0.006

1,3731,936

Environmental

million10,000 tonsmillion tons/RMB billiontonstonstons

headcountbillionshareheadcounthour%%millionheadcounthoursession

4.4

366,840,00012,080

139.87

12(Non-hazardous)48(hazardous)

5.2

480,932,48414,580

169.49

12(Non-hazardous)48(hazardous)

Indicator

Indicator

Unit

Unit

2023

2023

2024

2024

Invested in environmental protectionCarbon dioxide emissionsCarbon dioxide emissions intensitySO

in Exhaust gasNOx in Exhaust gasCOD in Wastewater

Female in middle managementTotal amount of employee stock ownership planTotal shares purchasedBene?ted employeesTraining hours per employee per yearTraining coverage rateOccupational health examination coverageInvested in safetyFatalities from safety accidentsSafety training hours per employeeSecurity training

tonstons10,000 tons10,000 tons10,000 kWhmg/m

10,000 tonsmillion tons/RMB billion

6,514

0.000070

5,161

0.038

12,530

0.000067

4,086

0.033

IndicatorUnit20232024

Ammonia Nitrogen in WastewaterAmount of Hazardous WasteConsumption of crude oilConsumption of coalPV power generationEmission intensity of mercury and its compoundsIndustrial Freshwater ConsumptionIndustrial Freshwater Consumption Intensity

Organization detailsEntities included in the organization's sustainability reportingReporting period, frequency and contact pointRestatements of informationActivities, value chain and other business relationshipsEmployeesGovernance structure and compositionNomination and selection of the highest governance bodyChair of the highest governance bodyRole of the highest governance body in overseeing the management of impactsCommunication of critical concernsMechanism for seeking advice and raising concernsCompliance with laws and regulationsApproach to stakeholder engagement

P4-P5P2P2P6-P7P4-P5P50-P57P14-P15P14-P15P14P14-P15P15-P16P18-P19P16-P17P20-P21P21P21P21/P7

Process to determine material topicsList of material topicsManagement of material topicsDirect economic value generated and distributedDe?ned bene?t plan obligations and other retirement plans

Report Content IndexesGRI Content IndexGRI Standards

GRI2 General Disclosure

GRI3 Material Topics

GRI 201 Economic Performance

Page2-12-22-32-42-62-72-92-102-112-122-162-262-272-293-13-23-1201-1201-3

Report Content Indexes

Infrastructure investments and services supportedSigni?cant indirect economic impacts

//P18P18-P19P18-P19P22-P23P23P28、P30P28P30P28P24P29P30-P31P30-P31P31P31P31P52Benefits provided to full-time employees that are not

Operations assessed for risks related to corruptionCommunication and training about anti-corruption policies and proceduresCon?rmed incidents of corruption and actions takenEnergy consumption within the organizationEnergy intensityManagement of water discharge- related impactsWater withdrawalWater dischargeWater consumptionGHG emissions intensityNitrogen oxides (NOx), sulfur oxides (SOx), and other signi?cant air emissionsWaste generation and signi?cant waste-related impactsManagement of signi?cant waste-related impactsWaste generatedWaste diverted from disposalWaste directed to disposal

GRI standards

GRI203： Indirect Economic Impact

GRI 401: Employment

GRI205 Anti-Corruption

GRI 302 Energy

GRI 303 Water and E?uents

GRI 305 Emission

GRI 306 Waste

Page203-1203-2

401-1

205-1205-2205-3302-1302-3303-2303-3303-4303-5305-4305-7306-1306-2306-3306-4306-5

P52-P53P54P54P54P44P42-P46、P54P42-P46P54P42P54P55-P56P55-P56P14-P15、P52/P60-P64/

P48-P49P46-P48

Average hours of training per year per employee

Diversity of governance bodies and employeesOperations and suppliers at significant risk for incidents offorced or compulsory labor

New suppliers that were screened using social criteriaAssessment of health and safety impacts of product and servicecategories

Operations with local community engagement, impactassessment, and development plansOperations with significant actual and potential negativeimpacts on local communities

Occupational health and safety management systemHazard identi?cation, risk assessment and incident investigationOccupational health servicesWorker training on occupational health and safetyPromotion of worker health

Work-related injuriesWork-related ill health

GRI standardsGRI 403: Occupational Health and Safety

GRI 404: Training and Education

GRI 405: Diversity and Equal OpportunityGRI 409: Forced or Compulsory Labor

GRI 414: Supplier Social AssessmentGRI 416: Customer Health and Safety

GRI 413: Local Communities

Page

404-1404-2405-1409-1

414-1416-1

413-1413-2

403-1403-2403-3403-5403-6403-7403-8403-9403-10

401-2provided to temporary or part-time employees.

Prevention and mitigation of occupational health and safetyimpacts directly linked by business relationships

Programs for upgrading employee skills and transitionassistance programs

Workers covered by an occupational health and safetymanagement system

Report Content Indexes

P24、P67P31P30-P31、P68P26P26P24-P25P28P31P60P60-P63P24-P38P34-35P46、P48-P49P49P46-P47P48P52-P57P21P20-P21P18-P19P18

Guidelines No. 3 for Self-Regulation of Listed Companies-Preparation of Sustainability Reports of Shenzhen StockExchange

Disclosure RequirementPage

Addressing Climate ChangePollutant EmissionWaste DisposalEcosystem and Biodiversity ConservationEnvironmental Compliance ManagementEnergy UtilizationWater Resource UtilizationCircular EconomyRural VitalizationSocial ContributionInnovation-drivenScience and Technology EthicsSupply Chain SecurityEqual Treatment of Small and Medium EnterprisesSafety and Quality of Products and ServicesData Security and Customer Privacy ProtectionEmployeesDue DiligenceStakeholder CommunicationAnti-commercial Bribery and Anti-corruptionAnti-unfair Competition

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Hengyi Petrochemical Co., Ltd2024 Environmental, Social, and Governance (ESG) Report