Stock abbr.: LAZZENStock code: 002706
Shanghai Liangxin Electrical Co., Ltd.
2022Environmental, Social and Governance (ESG)ReportESG
Communication withstakeholdersAnalysis of material topics
Continuously improvinggovernanceStrengthening risk compliancemanagementBuilding a strong ?rewall forinformation protectionStrengthening intellectualproperty protection
People-oriented to realizeemployee valueWorking together to create asustainable ecosystemWorking together to driveindustry development
About This ReportMessage from Our ChairmanAbout LAZZEN
ESG Management
Governance Responsibility:
Pursuit of Excellence
Social Responsibility:
Win-win Cooperation
| 01 | 03 | 05 |
Quality servicesIntelligent factoryProcess management
Green management:
quali?cation certi?cationGreen innovation: energy savingand consumption reductionGreen manufacturing: cleanerproductionGreen oce: low-carbon life
List of KPIsIndex of KPIsFeedback
Special Topic onResponsibilities
Environmental Responsibility:
Green and Low Carbon
Appendixes
| 02 | 04 | 06 |
Table of
Contents
2022 Environmental, Social and Governance (ESG) Report
About This Report
OverviewThis Report is the ?rst Environmental, Social and Governance (ESG) Report issued by ShanghaiLiangxin Electrical Co., Ltd. (hereinafter referred to as "LAZZEN", "We" or "the Company") tostakeholders.Scope and boundary of the ReportThe information disclosed in this Report is consistent with the ?nancial information disclosed inour 2022 Annual Report.
Source of dataThe ?nancial data in this Report comes from our audited ?nancial statements while other datais derived from the internal documents and information summary of the Company. Unlessotherwise stated, Renminbi ("RMB") is the unit of measurement in respect of the currencyand amounts referred to in this Report. The Company ensures that there are no false records,misleading statements or material omissions in this Report and is severally and jointly liable forthe authenticity, accuracy and completeness of the report contents.
Basis of preparationNational Standards of People's Republic of China: Guidance on Social Responsibility Reporting(GB/T 36001-2015)Guidelines on Corporate Social Responsibility Reporting for Chinese Enterprises (CASS-ESG 5.0)by the Chinese Academy of Social Sciences (CASS)United Nations 2030 Sustainable Development Goals (SDGs)GRI Standards by Global Sustainability Standards Board (GSSB)ISO 26000-2010: Guidance On Social Responsibility by ISOGuidelines for Social Responsibility of Listed Companies by Shenzhen Stock Exchange
Process for preparationBased on our ESG practices, this Report is prepared as per the process "Project Research —Collection of Materials — Preparation and Revision — Review by Senior Management — Reviewby the Board of Directors — Disclosure" and involves active communication with stakeholders onproject initiation approval, preparation and revision to determine and demonstrate the frameworkand contents of this Report.Form of releaseYou can view or download the electronic version of this Report on the ocial website (sh-liangxin.com) of Shanghai Liangxin Electrical Co., Ltd. The Company will keep improving and enhancingour report disclosure level and ESG governance in the future. If you have any questions orsuggestions about this Report, please feel free to contact us:
Shanghai Liangxin Electrical Co., Ltd.Address: No. 2000, South ShenJiang Road, Pudong New Area, ShanghaiTel.: 86-21-68586699E-mail: liangxin@sh-liangxin.com
2022 Environmental, Social and Governance (ESG) Report
2022 is a wonderful and challenging year!Over the year, we have not forgotten our original intention. We have returned to common sense, withouttaking shortcuts. We have worked hard to improve our internal skills. Our new brand logo, "LAZZEN", has beennewly released. Our BDC team has demonstrated a new look. Our Haiyan Base has been successfully put intooperation. Our procurement transformation and lean project have been continuously implemented. We have madesteady progress in the end-to-end process-oriented organization transformation. Our brand in?uence has beencontinuously increased. All our achievements made over 2022 have laid a solid foundation for us to achieve higherobjectives in the next year.Over the year, we have been committed to innovation, serving our customers, and creating value for customerswith new solutions and products. We have made every eort to ensure success of the "2022 Beijing Ice and SnowOlympic Winter Games" project. We have helped our customer to fulfill its commitment to hosting the "ZeroCarbon World Cup" in Qatar. Our Smart Home Magic Panels series has won the "2022 iF Product Design Award"of Germany. Our low-voltage circuit breaker has won the National Manufacturing Single Champion Productaward. We have won awards and obtained quali?cations including the fourth Best Managed Companies (BMC),National Intellectual Property Demonstration Enterprise, Top 100 Shanghai Enterprises of Shanghai, and Top 20Manufacturing Enterprises of 2022.In the context of the national "Carbon Peaking & Carbon Neutrality" policy and through our continuousexploration and improvement, we have adhered to the green manufacturing driven by technological innovation.We have realized low-carbon, green and digital product lifecycle management. Based on lean management ofinfrastructure, management system, technical products, and environmental emissions, we have vigorously drivenlean transformation of water, electricity and gas equipment, with third-party regular monitoring of waste gas,waste water and noise. For all the eorts we have made, we have achieved synergetic development of economicbene?ts and social bene?ts of the Company.In 2022, we have de?ned the "three stages" development strategy and targeted at "intelligent power distribution,smart home and new energy electrical technologies, industrialization and informatization, and integrated supplychain" as our key work directions. In 2023, all LAZZEN people will adhere to the strategic direction, continueto build up capabilities, drive transformation and growth, practice the concept and spirit of "doing better thanour best in low-voltage apparatus", create value for customers with higher reliability, consistent products andintegrated solutions, and make unremitting efforts to build a new zero-carbon ecosystem of smart apparatus.At the same time, our company will continue to follow the concept of social responsibility, from the practitionerof social responsibility to the leader of ESG, give play to the spirit of innovation, and forge ahead to realize thesymbiosis and common prosperity of business and society.
Message from Our Chairman
Chairman of LAZZEN
2022 Environmental, Social and Governance (ESG) Report
About LAZZEN
Company overview2022 milestones
2022 Environmental, Social and Governance (ESG) Report
Company overview
LAZZEN is a leading intelligent manufacturing technology company in the industry, committed to building anew zero-carbon ecosystem of smart apparatus. We focus on intelligent power distribution, smart home andnew energy electrical technologies, build the global headquarters in Shanghai and a future factory in Haiyan,Zhejiang, and provide innovative system solutions for customers in industries such as new energy, informationcommunication, construction, electric power, industry, industrial control, and home. Our brand slogan "Wherethere is electricity, there is LAZZEN" has gained the full trust and praise of our customers.Listed on the Shenzhen Stock Exchange in 2014 (SZ.002706), LAZZEN has achieved leapfrog growth continuously.We drive product R&D by consumer centricity and market demands. Our annual R&D expenditure equals morethan 6% of our revenue. We have won honors and quali?cations such as National High-tech Enterprise, NationalIntellectual Property Demonstration Enterprise, National Manufacturing Champion, National Green FactoryDemonstration Unit, Pilot Zhejiang Future Factory and Deloitte's Best Managed Companies and have establisheda National Enterprise Technology Center, a Post-Doctoral Research Center, and a Testing Center that is accreditedby CNAS & UL, laying a solid foundation for independent innovation and healthy and sustainable development.Through the super-representation and end-to-end service system, LAZZEN has its business covering more than140 cities in China and other countries and regions including Europe, North America and Asia to provide qualityproducts and service solutions for global users.
Basic information
2022 Environmental, Social and Governance Report
Full
coverage
citiesLong
warrantyperiod
-monthwarrantyExcellent
solution
60%
customizationFast
electri?cation
6h
power supply
guarantee
Strategy and culture
Values
Pursuit of customer success Responsibility and ambition
Pursuit of truth and introspection Openness and collaboration
SocialresponsibilityLAZZEN provides high-quality products and services to the society, operates inaccordance with applicable laws, pays taxes according to regulations, and maintainssustainable and healthy development.LAZZEN adheres to independent innovation to drive development of electrical technologies.LAZZEN is committed to save resources, protect the environment, and proactivelyparticipate in carbon neutral and zero carbon construction.LAZZEN is committed to protect the safety and health of its employees andcontinuously improve their compensation and bene?ts.LAZZEN is committed to support public health and cultural construction and proactivelyparticipate in social contribution programs.
To do better than our best in low-voltage apparatus and work together
to build a new zero-carbon ecosystem of smart apparatus.
Mission and vision
LAZZEN focuses on low-voltage apparatus and chooses the targetconcentration strategy by leading in intelligent power distribution, smarthome, and new energy electrical technologies, to be an expert in smart
apparatus solution.
Strategy
2022 Environmental, Social and Governance (ESG) Report2022 milestones
2022.1The Company was shortlistedfor Excellent IntelligentManufacturing Scenarios forlean production management.
2022.1The Industrial DesignInnovation Center of theCompany was awardedthe 2021 EnterpriseDesign InnovationCenter in Shanghai.
2022.2
The Company wasrated as the NationalEnterprise TechnologyCenter for 3 consecutivetimes.
2022.3The Company wonthe 2021 StrategicPartner Awardgranted by Sungrow.
2022.3The "Striver No. 1"Phase II employeestock ownership planof the Company wasocially launched.
2022.4The smart home MagicPanels series of theCompany won the iFProduct Design Award2022 for advanced userexperience and excellentdesign concept.
2022.7
The Company wonthe Samsung SupplierAward granted by CRRCCorporation Limited forquality products andexcellent services.
2022.8The Company was wonthe 2022 Best ManagedCompanies award forsustainable developmentand advanced managementconcept.
2022.8The brand of theCompany was updatedand released.
2022.9The Company won ?veawards in the List ofTop 100 Enterprises inShanghai.
2022.9Ren Silong, Chairmanof the Company, wasinvited to attend theAnnual CEIBS AlumniSocial ResponsibilityMeeting and 2022 ESGForum.
2022.11The Company wasrated as the NationalIntellectual PropertyDemonstrationEnterprise.
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Communication with stakeholdersAnalysis of material topics
ESG Management
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2022 Environmental, Social and Governance (ESG) Report
Stakeholders
Expectations from the
Company
Communication and
ResponseShareholders andinvestors
Transparent ?nancial information
disclosureEnhanced risk controlCreation of economic value
Information disclosureShareholders' meetingWorking meetingsCommunication and coordinationGovernments andregulators
Operations and tax payment incompliance with all applicable laws and
regulationsFully improved quality and eciency
Support for local development
Daily reporting and communicationMeetings and exchanges
Customers
Provision of diversi?ed products and
quality servicesGuaranteed product and service quality
Better customer experience
Information disclosureCustomer feedback and response
Customer satisfaction surveyPartners
Cooperation with integrityTransparent procurement
Win-win development
Project cooperationWorking meetingsDaily communicationEnvironment
Minimized environmental impactResponse to climate change
Environmental information disclosure
Environmental protection activitiesEmployees
Protection of basic rightsEnsured safety and healthSmooth growth pathCare for employees' personal lives
New employee communication
Regular meetingsNormalized training
ExchangesCommunities
Engagement in community workSupport for social contribution
programsFacilitation of local development
Social contribution programsVolunteer serviceInformation disclosure
Communication with stakeholders
Analysis of material topicsOn the lofty mission "to do better than our best in low-voltage apparatus and work together to build a new zero-carbonecosystem of smart apparatus", the Company has long integrated the concept of sustainable development into dailyoperations and management. Starting from six directions, we actively ful?ll our social responsibilities, pursue the balancebetween environmental, economic, and social values, continuously improve the ESG governance system, and enhancegovernance capabilities.
With great importance attached to stakeholder communication and engagement, the Company has built variouscommunication channels and platforms and actively responds to the expectations and demands of stakeholders, so as todevelop closer relations.
To assess stakeholders' concerns and expectations on the material topics in our environmental, social and governance
areas, we strictly follow the material topic analysis process de?ned in the GRI Standards, conduct internal and external
stakeholder surveys with questionnaires, identify and screen out key topics of great materiality, and disclose those topics
in the Report, so as to better respond to the demands and expectations of stakeholders.
Communication with stakeholders
Material topic matrix of LAZZEN
Importance to stakeholders
Importance to the enterprise
Product quality
Technologicalinnovation
Occupationalhealth and safety
Customer service
Green production
Responsiblemarketing
Wastemanagement
Supply chainmanagement
Employee training
Employee rights
Intellectualproperty
Compensationand bene?ts
Democraticmanagement
Anti corruptionand business ethics
Green operation
Industrycooperation
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2022 Environmental, Social and Governance (ESG) Report
Quality servicesIntelligent factoryProcess management
Special Topic onResponsibilities
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2022 Environmental, Social and Governance (ESG) ReportQuality servicesThe "14th Five-Year Plan" clearly stresses the need for systematic layout of new infrastructure construction. The currentcomplicated international situation also means an opportunity of the times to China's national brands of low-voltageapparatus. Based on the business philosophy of "improving quality, creating quality products and serving customers", thevalue of customer centricity and the concept of market orientation, the Company focuses on low-voltage apparatus byproposing the strategy of developing intelligent power distribution, smart home and new energy electrical technologies,providing customers with best solutions as well as quality products and services through scienti?c analysis of the marketand professional technical services.
Sealed by ceramic brazing, no arc spatter, safe and reliable;Industry-leading short-time withstand product parameters, with auxiliarycontacts;Non-polar products, DC1500V voltage large energy storage main circuit;A complete set of product certi?cations including CCC, CE, TUV, and UL.
Based on years' experience in the development of intelligent switchgear,the Company has launched an electrical and digital solution, the so calledMagic Link Power Smart Management Platform, by integrating fullyintelligent components, modules, and software. With the monitoring andmanagement of the "electric power" system as the core, the platformintegrates the applications of medium and low-voltage systems to achieveintegrated platform management and provide easy-to-use and efficientelectrical and digital system functions including collection, monitoring,analysis, prediction, guiding, and carbon saving.
Sealed by ceramic brazing, no arc spatter, safe and reliable;Round ceramic products, optional auxiliary contacts;Non-polar, a life of 1000 cycles if charged on DC1000V State Grid chargingpiles;A complete set of product certi?cations including CCC, CE, TUV, and UL.
Sealed by ceramic brazing, no arc spatter, safe and reliable;Additional magnetization block design to contacts, industry-leading 15kAand 10ms short-time withstand;Non-polar products, magnetic blow-out;Small size, horizontally or vertically installed, applicable to scenarios of newenergy vehicles.
Listed to UL1066 standard, with comprehensive improvement of safetyprotection performance and reliability, in comparison to circuit breakerslisted to other standards;Applicable to PV and energy storage in special environments such ashigh altitude, low temperature, and high temperature;Applicable to inverters' mainstream AC and DC power supply requirements;Anti-vibration and shock, steady-state sinusoidal vibration, randomvibration, shock & vibration;High voltage, rated insulation voltage up to 1250V.Full protection;High precision measurement;Safe, reliable, convenient operation and maintenance;Interconnection.Leading platform, innovative structure;Small size, eectively saving cabinet space for customers;A variety of accessories available to easily help customers expandproduct functions;Meet domestic and foreign PV, energy storage and other high voltage,high short-time withstand requirements;A full range of speci?cations, providing customers with dierent choicesand eectively saving costs.
Series 1
Series 2
Series 3
Multiple conversion methods;Excellent dual power supply performance;Mechanical and electrical interlocking;Dual power supply CCC certi?cation;CB-grade protection.
NDQ5W:
NDW3A:
NDM3ESeries:
NDG3V:
NDZ3AT-25010H-60010H:
NDZ3AT-150R-350R:
NDZ3AT-250C/300C:
Magic Link Power Smart ManagementPlatform:
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2022 Environmental, Social and Governance (ESG) Report
Magic Panels series
The Company adheres to the in?nite insight and exploration of living space, unremittingly seeks to make breakthrough inultimate smart lifestyles, provides multi-functional and uni?ed whole-house smart solutions through the coverage of ninesmart systems, and develops boundless and integrated Magic Panels series to realize intelligent power distribution andinterconnection and interaction of smart home.
In line with customer centricity and driven bycustomer requirements, the Company focused on thelayout of new energy electrical technologies. To meetBYD's requirement for large-current MCCBs, the R&Dteam and product team of the Company provided anefficient and smart low-voltage power distributionsolution to meet the customer's requirements. Thesolution not only helped ensure the continuity ofpower supply in BYD's factory but also effectivelyimproved the safety of the power distribution systemin the factory and solve the customer's system painpoints.
Series 4
Case
Customized new energy electrical technology solution ensured safepower distribution in an industrial park.
To meet various needs of customers for whole-house energy efficiency monitoring, water and gas safety, variousscenarios, network coverage without dead spots, and air quality monitoring, the Company relied on its industry-leading and complete smart home systems to provide customized solutions for 780 residential houses in a gardenmansion community in the new Chinese, Zen and royal style. The intelligent micro-end was used to monitor the energyconsumption of the entire house in real time. The gas and water intrusion sensors were used to provide timely warning.The central control screen and voice panel were used to achieve free switching of various scene modes. The air boxlinking the fresh air system helped monitor and improve air quality in real time. Wi-Fi coverage throughout the homeallowed users to navigate the Internet anytime, anywhere.
CaseSmart home makes for a better life.
Panorama of smart home
The 800-megawatt Al Kharsaah PV power station,undertaken by PowerChina Guizhou Engineering Co.,Ltd., had to overcome harsh conditions such as long-term high temperatures up to 50°C and frequentsandstorms. The Company provided the customerwith a customized smart electrical system solutionthrough technological innovation, which not onlysolved the problem of developing a desert PV powerstation at high temperature, but also helped Qatarful?ll its commitment to hosting a Zero Carbon WorldCup. This case provides effective evidence of theCompany's products and solutions going global.
Case
The smart electrical system solution of the Company helped Qatarbuild a Zero Carbon World Cup.
800-megawatt Al Kharsaah PV power station
BYD oce building
Adopt the family vision, minimalist design concept,applicable to various home furnishing styles.
Break through the single-product thinking frameworkand achieve 1+1 > 2 function combination based onfunction combination among dierent products.
The series integrate a thermostat with ultra-thinintegrated black large screen design and are providedwith a three-in-one multi-functional integratedthermostat and are linked with functions including VRVAC, fresh air, and water heating. The distributed controlwiring ensures the independence of dierent functionsand signi?cantly uni?es multi-functional operations.
Attractive appearance,with Rubik's Cubecombinations openingup unlimited possibilitiesfor home furnishings
Magic full screen,multi-functionalblending
1+1>2 leapfrog function
combination
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2022 Environmental, Social and Governance (ESG) Report
The Company attaches great importance to quality management. In line with quality concept of "customer centricityand quality as our dignity", the Company implements whole value chain quality management which is supported bythe quality information system. Since the establishment of a quality management system in accordance to the ISO 9001standard in 2001, the Company has implemented integrated quality management, whereby each business departmentshall be responsible for its own business quality and set up its own quality and operation department. Meanwhile, theCompany has actively introduced third-party certi?cation institutions to carry out quality assessment. Every year, theCompany is certi?ed to the ISO 9001 standard and other quality system standards.
The Company attaches great importance to R&D andinnovation by constantly improving the innovationmanagement system, establishing relevant sound systems,and taking multiple measures to stimulate employees' R&Dand innovation vitality. In order to speed up the process ofproduct innovation and replacement, the Company holdsa technology innovation award selection event every yearto collect candidate projects from technology R&D teamsacross the Company. A technical expert team is formed upto evaluate and select projects with the best technologicalinnovation value. Rewards are given to the winning teamsto encourage innovation and breakthroughs.
Strict quality management
Adhering to R&D and innovation
Data performanceBy the end of the reporting period, the Company has 102 quality management personnel and 110 qualityinspection personnel.
Evaluation of the annual professional technology
innovation award of the Company
OTS automated production line
Quality and Operations Department
R&D
Manufacturing
Procurement
Customer service
Manage the quality strategy, quality culture,quality measurement, and quality system of
the Company.With the supplier relationship management(SRM) system, the Supplier Technology andQuality Department is responsible for devicecerti?cation and supplier quality management.
The PQA of the Quality and OperationDepartment of each product line isresponsible for implementing R&D qualitymanagement according to the IntegratedProduct Development (IPD) process, as wellas managing and controlling R&D projects,drawings and technical documents throughthe PLM system.Manage the quality of incoming materialsand on-site production processes throughthe Quality Management System (QMS)system and manage manufacturing datathrough the MES system.
Implement the Issue to Resolution (ITR)process, import information from the customerside on the distribution management system
(DMS), and carry out 8D analysis andmake improvement through the intelligent
manufacturing system (IMS).
The Company has introduced an advanced automatic MCB production line, an automatic production line for universalcircuit breakers, shell splitter, contactor life test equipment to optimize production processes and upgrade manufacturingtechnologies. Relying on the industrial interconnection platform, the Company can efficiently connect equipment tothe manufacturing system to enable automation, informatization, and intelligence of the production process and highintegration of industrialization and informatization.
Automated manufacturing
Intelligent factory
Since its establishment, the Company has adhered to the brand positioning of "an expert in high-end low-voltageelectrical system solutions" based on the vision of "to do better than our best in low-voltage apparatus and worktogether to build a new zero-carbon ecosystem of smart apparatus". To meet the need for operation upgrading andexpansion, and respond to China's "14th Five-Year Plan for Intelligent Manufacturing Development" and "Made in China2025", the Company has actively deployed the special "762 Digital Strategy" project to build a digital, networked, andintelligent demonstration factory and promote transformation and upgrading of traditional industries.
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2022 Environmental, Social and Governance (ESG) Report
The Company has set up a professional simulation team, introduced professional simulation software, and built asimulation platform for electromagnetics, structure, motion, thermal ?uid, tolerance analysis and optimization analysis, tosimultaneously perform numerical simulations in replacement of traditional tests, and screen and optimize designs. TheCompany is capable of innovatively coupling multiple physical ?elds into multiple independent physical ?elds for analysis,in a way to greatly improve the eciency and quality of project development.
The Company insists on driving value innovation with digital technologies. By using technologies including big data, AI,cloud computing, 5G, IoT, industrial interconnection and digital twin and connecting systems including PLM, SAP, OMS,SRM, APS, MES, WMS, QMS and TMS, the Company has streamlined the digital management system and the concernedbusiness sections and has formed a collaborative system operation mode among suppliers, LAZZEN, and customers.
Digital product design and simulation
Collaborative operation of upstream and downstream supply chains
Relying on the global R&D management system at the HQ and technology accumulation in intelligent manufacturingand industrial Internet, based on industrial interconnection, the Company has established the whole-process intelligentproduction system covering Haiyan intelligent factory, intelligent logistics, intelligent production and intelligent supplychain and is active building a 4.0 benchmark intelligent factory with large scale, complete process, advanced equipmentautomation, high information integration, efficient logistics and agile delivery in the low-voltage apparatus industry.Currently, Phase I of the project has been put into operation successively while Phase II has been completed and accepted.
Case
Future factory.
Haiyan Future Factory of the Company
Process managementIn the age of information management, process management aims to find an optimal path and method for strategyrealization with the help of a set of scienti?c tools and methods. Through end-to-end process construction, the Companyhas completed the transformation from a traditional functional organization to a process-oriented organization. With theprocesses as the carrier, the Company has included management requirements on quality system, standards, internal riskcontrol and systems in the business processes and carries out operational management based on each business processto drive digital transformation of the Company and ensure ecient achievement of strategic objectives. At present, theCompany mainly performs operational management based on four main processes including DSTE, IPD, LPM, and ITR.
The Develop Strategy to Execute (DSTE) process transmits strategic objectives to the three main execution processes(including IPD, LPM, and ITR) which feed back the operation results to the DSTE, eectively ensuring the entire processfrom planning to implementation of the Company's strategies.
DSTE
The Integrated Product Development (IPD) process is a set of R&D management system processes for short-term productdevelopment and medium & long-term product planning and investment management. It covers the import of theCompany's strategic planning, management of external market demands, planning for product roadmaps and technologyroadmaps, development of project briefs, product development, marketing, and life cycle management.
IPD
The LPM process is a set of self-developed system processes for digital marketing process management, which combinesthe end-to-end marketing process ideas of our benchmarking processes (Huawei's MTL and LTC processes) and alignswith the sales management model of the Company. It combines the marketing management processes and systems. Itsend-to-end processes include three main processes: market insight and management, lead to cash (LTC), and customerrelationship management.
LPM
The Issue to Resolution (ITR) process is a set of standard service management system processes, from customerdemands to meeting customer delivery, from issues to resolution. With this process, LAZZEN is able to provide rapidservice response and solve customer issues and improve product quality so as to improve customer satisfaction and evenachieve productization of services in the future.
ITR
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Opportunities and challengesOur actions· The state is more concerned about protecting the legitimate rights and interests of small and medium-sized investorsin the capital market.· Progress has been made in the development of intellectual property with Chinese characteristics.· The industry is facing uncertainties due to the complex and ever-changing international situation.
· Keep improving the Company's governance and establish agovernance structure with eective checks and balances.· Emphasize the quality of information disclosure and enhancethe fairness and transparency of information disclosure.· Strengthen investor relationship management and ensuremultiple communication channels.
· Optimize the internal control system and strictlycontrol risks.· Raise the Company's overall incorruptibilityconsciousness and create a clean environment.· Strengthen the protection of intellectual propertyand stimulate the vitality of R&D and innovation.
SDGs benchmarking
GovernanceResponsibility ·Pursuit of Excellence
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2022 Environmental, Social and Governance (ESG) Report
Continuously improving governance
In accordance with laws and regulations including the Company Law and the Securities Law, the Company hasestablished a governance system centered on the Company's Articles of Association and formed a decision-makingstructure mainly represented by shareholders' meeting, board of directors, board of supervisors and management. It isnecessary to keep improving the Company's governance structure, standardize the Company's operations, and enhancethe operation quality of the Company's governance, so as to provide a good management decision-making environmentand guarantee for the Company's standardized development.
The Company attaches great importance to investor relations and has developed the Investor Relations ManagementSystem to ensure that all shareholders have equal access to information about the Company. In 2022, the Companyorganized a performance briefing and answered 100% of investors' questions; meanwhile, the Company carriedout investor relationship management through multiple channels, platforms, and methods. The major means ofcommunication included performance brie?ngs and online and oine surveys.
As required under applicable laws and regulations, the Articles of Association and the Information Disclosure ManagementSystem, the Company shall disclose its information in a true, accurate, complete, timely and fair manner, seek to enhancethe quality and transparency of information disclosure, and ensure that all of the Company's shareholders have equal accessto information and keep abreast of the Company's operating conditions and signi?cant events.
Organizational structure of the Company
Investor relations management
Information disclosure management
As per and as required under the Articles of Association and the Rules of Procedures for Shareholders' Meetings, theCompany standardizes the convening, holding and voting procedures of shareholders' meetings, to ensure that allshareholders, especially minor shareholders, have equal status and that shareholders can fully exercise their shareholderrights and to fully respect the legitimate rights and interests of all shareholders.
The Company's board of directors consists of 9 directors, including 3 independent directors. Members of the boardof directors include industry experts, professionals in ?nance, law and business management, who are equipped withknowledge, skills and qualities necessary to ful?ll their duties. All the Company's directors can discharge their dutiesfaithfully, honestly and diligently. The convening, holding and voting procedures of the board of directors shall begoverned by the Rules of Procedure for Board Meetings.
The Company's board of supervisors consists of 3 supervisors, including 2 female supervisors and 1 employeerepresentative supervisor. The convening and holding procedures of the board of supervisors shall be governed by theRules of Procedure for the Board of Supervisors. All supervisors can conscientiously discharge their duties as required,including supervising and inspecting the Company's financial position and the performance of directors and seniorocers and protecting the legitimate rights and interests of the Company and shareholders.
About shareholders and shareholders' meeting
About directors and the board of directors
About supervisors and the board of supervisors
Data performance
Data performance
During the reporting period, the Company has held 6 BOD meetings, 6 board of supervisors meetings, and4 shareholder meetings.
During the reporting period, the Company has issues a total of 94 announcements.
Shareholders'
MeetingBOD
Board ofSupervisorsSecretary ofthe BOD
Marketing SystemProduct LineTechnical SystemManufacturing SystemProcurement SystemStrategy and QualityOperation DepartmentHR DepartmentFinance SystemLAZZEN TalentDevelopment CenterPresident
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2022 Environmental, Social and Governance (ESG) Report
Strengthening risk compliancemanagement
In order to strengthen risk compliance management and build a risk management organization in line with thegovernance structure of a modern high-tech enterprise, the Company has set up a risk management committee andan independent risk control department. The Risk Management Committee is mainly responsible for establishing a riskmanagement system, cultivating a risk management culture, and building three lines in risk management, so as to keeprisks under control and ensure the Company's operational compliance. The committee consists of the Executive President,who leads risk management, and other ocers, who work together to deal with risk management matters authorized bythe board of directors. The Risk Control Department is mainly responsible for planning for risk management and internalcontrol implementation and supervision activities.
The Company places great emphasis on compliance operations. By establishing an eective compliance managementsystem and operating procedures, the Company can improve management capabilities and eciency, save managementcosts, and create a good reputation and image.Risk management
Compliance management
As the Company is developing fast, contract risk and accounts receivable risk during sales may have a negative impacton the business objectives of the Company. In order to enhance the quality of contracts signed by business personneland their risk prevention and control awareness, the Company organizes around 200 project managers to take part inContract Risk Training. The course contains detailed training from front-end, middle-end, and back-end of contracts andends with a completion test. This move can signi?cantly enhance the risk awareness and control measures of all eachproject managers in the business process.
In 2022, the State Council released the Measures for the Compliance Management of Central Enterprises. Althoughthe Measures cover central enterprises only, they provide a reference guide to local state-owned enterprises, privateenterprises and other businesses with dierent forms of ownership in corporate governance by law. In order to deepenthe implementation of good faith and compliance, the Company released the interpretation of the Measures for theCompliance Management of Central Enterprises through the OA system, , aiming to promote employees' understandingand learning of compliance measures and enhance the Company's overall compliance awareness.
To standardize and strengthen internal control, the Company has established a centralized, uni?ed and comprehensiveinternal control standard system based on the Basic Standards for Internal Control to realize an authoritative and ecientinternal control network. The Company has provided daily and special supervision over internal control to signi?cantlyimprove the Company's operational management and risk prevention capabilities.Case
Case
Contract risk training.
Interpretation of the Measures for the Compliance Management ofCentral Enterprises.
News released in the Company's OA system - Interpretation of the Measures for the Compliance Management of Central Enterprises
Under the centralized leadership of the Company's board of directors, develop the internal control team towardsinstitutionalization, process orientation, standardization and professionalism.
Deepen learning to build an authoritative and ecient
internal control team.
Collaborate with the Company's professional departments including auditing, risk control, ?nance, and quality operationsto share information, complement each other's expertise, and improve internal control eciency and quality.
Connect horizontally to form a point-to-line internal
control and supervision chain.
Go deep into the business, extend the quality operation department of each organization, expand the depth ofinternal control, reduce the blind spots of internal control, and form a comprehensive internal control network.
Expand vertically to build a comprehensive
internal control network.
Line 1Line 2Line 3Various business departmentsof the Company are mainlyinvolved in managing risksduring business operations.This is the most important line.Correspondingly, each businessdepartment is also the firstresponsible department for riskmanagement.
Departments and organizations thatprovide support for risk managementassist business departments in riskmanagement and control, providebusiness departments with riskmanagement and control methodologyand tools, and carry out risk monitoringand management to control risks andhelp achieve business objectives.
Internal audits aim toindependently evaluate theCompany's risk management,implement risk managementsupervision, and enhance thequality of risk managementthrough supervision.
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2022 Environmental, Social and Governance (ESG) Report
The Company seeks to become a clean enterprise, build a clean and positive ecological environment, and provide astrong discipline guarantee for the Company's high-quality development in strict accordance with applicable laws andregulations including the Criminal Law and the Anti-Unfair Competition Law.
Adhering to business ethics
The Company has released the Honesty and Integrity Management Measures through OA and organized all employeesto sign the Honesty and Integrity Commitment, a move to further deter, investigate and combat acts that violate theCompany's rules and regulations and damage the Company's interests, keep the Company's employees upright, honest,and dedicated to work, prevent and reduce corruption, protect the interests of the Company and individuals frominfringement, and support the Company's healthy development.
Committed to building a ecosystem with honesty and integrity with partners and suppliers, the Company requires theexecution of the Honest Cooperation Agreement as a necessary condition for signing contracts and conducting business.With the Supplier Code of Conduct, this covers integrity supervision, code of integrity, liaison officer management,integrity and self-discipline. As to distribution channels, the sales side enters into the Distributor Integrity and Self-discipline Commitment with distributors every year to prevent disordered low-price competition between distributorsfrom damaging LAZZEN's brand positioning, shape a fair and just market order, and jointly create a self-disciplinedbusiness atmosphere with honesty and integrity.
The Company supervises all violations of law and discipline as well as violations of management rules, and coordinateswith and assists judicial authorities to investigate and deal with violations of internal and external personnel as the casemay be. In addition, the Company guides and assesses the honesty and integrity of each segment.
Strengthen honesty and integrity management
Create a cooperation ecosystem with honesty and integrity
Protect reporting rights
Report email: audit@sh-liangxin.com
Building a strong ?rewall forinformation protectionThe Company attaches great importance to information security construction by adopting a defense-in-depth strategy,continuously investing resources in people, management and technologies, and following the PDCA process to defendinformation security, to protect its information security and legitimate rights and interests.
In order to advance the healthy, orderly and sustainable development of the Company's information constructionand eectively protect information resources, the Company invites an external professional auditing ?rm to audit theCompany every year as per ISO 27001, collect evidence of IT operation and maintenance sites and activities throughdiscussion, document review and ?eld investigation, review the issues found in previous audits and inspect the closedissues. This can help ?nd the current de?ciencies in information security, improve information management, and enhanceemployees' information security awareness.
Case
ISO 27001 annual audit.
ISO 27001 audit of the Company
Externally, LAZZEN's official website passed class II grade protectionevaluation in 2020. LAZZEN was certi?ed to ISO 27001 stand and passedthe ME IoT platform grade protection evaluation in 2021.Internally, the Company establishes a high-level security committee
whereby the senior management directly leads security governance, themiddle level eectively implements security management standards, andthe grass-roots carefully implements security procedures.
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2022 Environmental, Social and Governance (ESG) Report
Strengthening intellectual propertyprotectionThe Company attaches great importance to intellectual property management. By taking the opportunities of the times, theCompany has developed the strategy of intelligent power distribution, smart home, and new energy electrical technologies,so as to promote the intellectual property work from a strategic height. In strict accordance with applicable national lawsand regulations including the Patent Law of the People's Republic of China, the Trademark Law of the People's Republicof China and the Copyright Law of the People's Republic of China, the Company has establishes an intellectual propertymanagement system (which passed certification for the first time in 2017) by reference to GB/T29490-2013 Enterpriseintellectual property management, and developed systems including the Intellectual Property Management Procedures andthe Intellectual Property Risk Management Procedures, to standardize intellectual property protection.
The Company places a high value on the overall development of intellectual property creation, utilization, protection, andmanagement capabilities, by promoting intellectual property work from a strategic height, enhancing the intelligence ofproducts and solutions with high R&D investment, meeting the requirements of customers with more ecient, smarterlow-voltage power distribution solutions and building a new zero-carbon ecosystem of smart apparatus with partners.The Company was rated as the National Intellectual Property Demonstration Enterprise for its comprehensive competitiveadvantages in intellectual property.
Case
Awards
LAZZEN rated as the National Intellectual Property Demonstration Enterprise
Patent wall of the Company
Data performanceDuring the reporting period, the Company has applied for 286 patents (including 76 invention patents)and has obtained 388 granted patents.
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2022 Environmental, Social and Governance (ESG) Report
Opportunities and challengesOur actions· Climate change poses a signi?cant risk to the sustainable development of the global economy and enterprises and hasalso become a driving force for industry restructuring and green transformation.· China has been actively responding to climate change with a responsible attitude, and regards climate change as agreat opportunity to change its development mode.· Applicable environmental regulations and supervision over energy resources, greenhouse gases and solid wastes arebecoming more stringent.
· Adhere to innovation, and introduce technologies to saveenergy, reduce consumption and increase eciency.· Adopt clean energy and adhere to clean production.· Strengthen the recycling of wastes to boost the circulareconomy.
· Implement green procurement and give priority topurchasing raw materials with sustainability certi?cation.· Advocate green oce and low-carbon life.
SDGs benchmarkingEnvironmentalResponsibility · Greenand Low Carbon
3738
2022 Environmental, Social and Governance (ESG) ReportGreen management: quali?cationcerti?cation
Green manufacturing: cleaner production
Green innovation: energy savingand consumption reduction
The Company adheres to theconcept of green procurementby giving priority to purchasingand using raw materials with lessimpact on the environment so as topractice sustainable developmentfrom the source. The Companyhas built a physical and chemicallaboratory to strictly monitorand manage incoming materialsfrom suppliers; meanwhile, theCompany authorizes professionaltesting agencies to regularly testhazardous substance in parts andcomponents, to ensure that rawmaterials are harmless.Based on environmental protectionrequirements and sustainabledevelopment, the Companyplaces RoHS requirements onmaterial selection and processthrough product design, signsthe Supplier Quality Agreementand the Environmental ProtectionAgreement with quali?ed suppliers,and prepares a RoHS auditchecklist, supply report controland risk classification, with RoHScontrol seen as the Company'squality boundaries.
As an active response to the government's call, the Company makes full use of renewable energy to optimize the energystructure; improves or replaces high-energy-consuming process equipment by continuously adopting new processes,new technologies, and new equipment, to achieve energy saving and comprehensive utilization of resources.
Green procurement
Data performanceDuring the reporting period, the Company has applied 1,688.60 megawatt hours of renewable energy.
In order to effectively alleviate the pressure on energyconsumption arising from the production size andproduction load, the Company has introduced an intelligentpower distribution platform system, which features sitemonitoring, energy consumption analysis and powerdistribution management, and can be used to collect thepower consumption of each unit in the factory in real time,give warning about system failure, and statistically analyzedata & information. Through scientific management, theCompany not only signi?cantly lowers energy consumption,but also reduces carbon emissions.
CaseIntelligent power distribution platform system.
The Company's intelligent cloud power distribution
management system
Testing Center of LAZZEN
As per the environmental protection development plan, the Company includes the concept of environmental protectioninto the life cycle of products, and creates industry-leading green brands through products characterized by high energysaving, environmental protection and high performance. So far, the Company has 2 models of MCCBs and 8 models ofhousehold and similar ACBs that have passed review by the MIIT and rated as Green Design Products.
Green production
With standardized management as an important basisfor production process management, the Company haspassed ISO 14001 certi?cation and ISO 50001 certi?cation,and strictly implements the BSI system to conduct quality,environmental management and hazardous substanceprocess control. The Company innovatively studies greenmanufacturing integration for the purpose of intensiveworkshops, harmless raw materials, clean production,recycling of wastes, and low-carbon energy and become anenergy-intensive and environment-friendly enterprise. TheCompany was selected as a "National Green Factory" bythe MIIT. During the reporting period, the Company had noenvironmental incidents.
LAZZEN rated as Green Factory Demonstration Unit
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2022 Environmental, Social and Governance (ESG) Report
In managing wastewater, waste gases and solid wastes, the Company sorts them out to reduce pollution as required.Daily monitoring and regular third-party monitoring are implemented to ensure that emissions are always acceptable.With a balance of economic and environmental bene?ts, the Company actively advances the recycling of wastes, andpromotes the development of a circular economy. 8 models produced by the Company can be 100% recycling.
Data performanceNo incidents of excessive discharge of waste water, air, and noise pollutants are found since operation. The overallutilization rate of industrial solid waste is 100%.Green oce: low-carbon life
In active response to the national energy conservation and emission reduction policy, the Company implements greenoce in production and oce space and practices low-carbon life. Meanwhile, employees are encouraged to participatein and carry out environmental protection actions within their ability to help protect green home.
Made of low-toxicor non-toxic raw
materials
Starting from raw materials, prefer non-toxic or low-toxic raw materials, and use water-basedpaints instead of instead of oil-based paints for anti-corrosion spraying on PCBs, in a way togreatly reduce the resulting emissions of VOCs, xylene, and acetone.
According to the disposal principleof "recycling, reducing, andharmlessness", sort, collect, stackand dispose of hazardous wastesand general wastes to fully utilizeresources as much as possible.
Use energy-saving equipment, energy-saving LEDs,
and solar street lights in the park.
Advance paperless oce in the OA system and improve the
level of informatization.
Adopt 5S mode in the workshop.
Align green operations to the KPIs of the
Administration Department.
Minimize the purchase and use of disposable paper
cups.
Strengthen environmental protection publicity to enhanceemployees' awareness of environmental protection.
Separate rainwater and sewage inthe factory, sort and collect projectwastewater, dispose it by quality,and recycle it by quality.
Strictly implement various wastegas collection and treatmentmeasures to reduce environmentalpollution and health hazards.
Follow advanced design concepts, select advanced supporting products for productdevelopment and design, introduce automatic spot welders in closed operations, to avoidunorganized emissions of smoke and dust in welding.The pad printing process gradually replaces the original oil-based ink printer with a laserprinter, a move to greatly reduce VOCs emissions generated in the printing process.
Clean core parts with ultrasonic before assembly to ensure that the parts are clean onthe surface, dry the cleaned parts in a vacuum oven, and convey the dried parts into theassembly workshop through the transfer window.The assembly workshop is a static 10,000-degree clean room. Before entering the workshop,pass through two air shower doors, and change into one-piece clean clothes and high-topclean shoes and wear one-piece caps to ensure that no one will pollute the environment ofthe workshop.The Clean Workshop Use Speci?cations is formulated for personnel who enter the workshopand workshop management personnel. All personnel who enter the workshop and workshopmanagement personnel shall follow the Speci?cations to carry out activities in the workshopso as to ensure normal clean production in the assembly workshop with acceptablecleanliness.
Clean productionprocess
Prevention of pollution related to
solid wastes
Waste waterWaste gases
Emissions
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2022 Environmental, Social and Governance (ESG) Report
Opportunities and challengesOur actions· According to "14th Five-Year Plan", one of the Long-Range Objectives Through the Year 2035 is that "people willlead a better life, and more notable and substantial progress will be achieved in promoting well-rounded humandevelopment and achieving common prosperity for everyone".· China has intensively introduced national development strategies and industrial policies such as the 14th Five-YearPlan, "Carbon Peaking & Carbon Neutrality", "New Energy" and "New Infrastructure".· No signi?cant changes have occurred in the industry of low-voltage apparatus.
· Protect the health and rights of employees, and helpemployees grow and mature.· Stick to quality and service in line with the Integrity-based, customer ?rst thinking.· Develop cooperative relations and win-win cooperationwith relevant parties.
· Participate in industry activities to help industry
standardization and development.· Help cultural, educational and social construction.
SDGs benchmarkingSocial Responsibility ·Win-win Cooperation
4344
2022 Environmental, Social and Governance (ESG) ReportPeople-oriented to realize employeevalue
Since its establishment, the Company has been advocating and implementing the values of "integrity, care, responsibility,and aggressiveness", and placed much emphasis on the protection of employees' legal rights. In strict accordance with theLabor Law of the People's Republic of China, the Labor Contract Law of the People's Republic of China and other laws,regulations and local government requirements, the Company has developed the Human Resource Management System andother systems, keep improving employee management, and protect the legitimate rights of all employees. By adopting anti-discrimination rules to eliminate unfair treatment, the Company sticks to equal pay for equal work, prohibits discrimination,resists the use of child labor and forced labor, and strives to create a fair, respectful and diverse working environment.
In line with fair, just, and transparent compensation performance, the Company has developed the PerformanceManagement System and continuously reviews the competitiveness of employees' compensation. Under the principleof distribution according to work, scientific compensation management is carried out in combination with employeeperformance appraisal, to encourage employees to continuously improve their personal capabilities and grow togetherwith the Company. Meanwhile, the Company respects the personality and dignity of employees, and supports employeesto display their talents and embody their personal values. According to the market-oriented and customer-centricapproach, the Company has developed a competitive talent incentive and assessment system in the industry.
As required under the Trade Union Law and the Chinese Trade Union Constitution, the Company has set up a tradeunion and workers' congresses, continuously improves the Trade Union Management System and the Company's TradeUnion Constitution, and ensures the implementation of democratic management by establishing an equal negotiationand collective contract system and smoothening Xinsheng community democratic dialogue mechanism. In addition, theCompany actively improves the factory affairs disclosure mechanism to promote democratic supervision, and conductslabor dispute mediation by law to ensure harmonious and stable labor relations.
Employee rightsEqual employment
Compensation and bene?ts
Democratic management
To effectively identify the issues in the Company's personnel management and learn the impact of the Company'sdecisions on employees, the Company surveyed employee satisfaction and collected 400+ opinions and suggestions. Inaddition, the Company coordinates the Trade Union, HR, Administration, Corporate Culture and other departments to setup a special teams to help employees solve issues and improve the Company's democratic management system.
CaseEmployee satisfaction survey.
By educational level:By position:
Data performance
During the reporting period, the Company has 2,211 employees.
Production personnelTechnical personnelAdministration personnel
Sales personnel
Long-termincentives
A total of three long-term incentive projects have been carried out, including equityincentives, restricted stocks, and employee stock ownership plans, with a large volume andwide coverage, enabling employees to truly contribute to the long-term development of theenterprise and share the achievements of the development.In terms of performance and bonus, the mechanism has been changed from theadministration granting mechanism to the acquisition and sharing mechanism. PBC andposition ful?llment have been adopted to manage personal performance as well as short-termand long-term objectives, ensuring sustainability with incentives.Employ salary is based on the position system and reference to the market level, withincreased ?exibility and improved security.
Bonus
Salary
Finance personnel
1,137
Doctorate degreesBachelor's degreesBelow associate degrees
Associate degreesMaster's degrees
4546
2022 Environmental, Social and Governance (ESG) ReportPursuant to the Social Insurance Law of the People's Republic of China, the Company has developed the C&BManagement System, strictly implements the social security system, and pays pension insurance, basic medical insurance,unemployment insurance, work-related injury insurance, maternity insurance and housing provident fund for employeesby law, and regularly organizes medical examinations to all employees every year.
Compensation and bene?ts of the Company
The Company is deeply convinced that employee well-being is inextricably linked to building a positive, ecient andcreative team. The Company attaches great importance to humanistic care, by oering various activities to employeesand relieving employees of diculties with sincere and warm care, so that every employees can fully feel the warmth ofhome and eectively enhance their sense of belonging.
Employee care
In order to further carry forward the Chinese nation'straditional virtue of respecting, loving and helping theelderly and create a harmonious and stable environment,the Company held a retirement ceremony for employeeswho have reached the mandatory age for retirement, in amove to fully arm the contributions made by the retiredemployees to the Company and provide models for youngemployees to learn and continue more brilliance.
CaseCare for retired employee.
Retirement ceremony for retired employees
To promote the spirit of cooperation in the Company's employees and improve their personal ?tness, the Company heldthe ?fth LAZZEN Cup badminton competition. A total of 40 employees from more than 10 departments participatedthe competition. In the competition, all teams fought bravely and strived to be No 1, showing the spirit of LAZZEN'semployees.
Case
LAZZEN Cup Badminton Competition.
LAZZEN Badminton Club
Liangxin basketball club
Liangxi football club
Liangxin table tennis club
As a strategic partner and teaching & researchbase of China Europe International BusinessSchool (CEIBS), the Company joined handswith the CEIBS to organize the CEIBS AMP24-Hour Elite Challenge. Aiming at CEIBSalumni entrepreneurs, senior managementteams, and various elites from the society,the Challenge had defined various types ofcompetition in terms of AMP class group,elite group, alumni enterprise group, businessschool group, and family & friend experiencegroup. The players of LAZZEN fought bravelyand gained good results in the Challenge. Thespirit of working together to archive excellentresults did not only re?ect in one competitiongame, but also was merged into the dailywork and every minute of customer service byLAZZEN people who made LAZZEN a leaderin the low-voltage apparatus industry with thesame dedication and perseverance.
Case
CEIBS AMP 24-Hour Elite Challenge.
Selection of outstanding employeesAnnual technology innovation award
selectionIntellectual property incentivesReasonable suggestions from employeesIncentives for excellent employees
Permanent residence in ShanghaiAllowances for club activitiesTeam building expensesAnnual physical examinations
for employeesDonations to needy employeesVisits to sick employeesIncentivesBene?ts
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2022 Environmental, Social and Governance (ESG) Report
In strict conformity with all applicable laws and regulations including the Work Safety Law of the People's Republic ofChina, the Company has established a safety committee, with the General Manager of the Manufacturing System of thePrimary Department as the Director and Director of the Administrative Department as the Executive Secretary. Fivemodules are defined by function, including fire safety, personnel safety, equipment safety, power safety, food safety.Two committee members are assigned to be the owners of each module. In addition, the Company keeps strengtheningoccupational health and safety work infrastructure construction, by strictly monitoring and managing health hazards inthe workplace, and standardizing and restricting employees' work behaviors through publicity, training, supervision andother means, so as to fully protect employees' health and safety.
As per applicable laws and regulations including the Law of the People's Republic of China on the Prevention and Controlof Occupational Diseases, the Company has prepared system documents in combination with the realities includingthe SOP for the Prevention of Occupational Diseases and the Integrated Management Manual and established a soundoccupational health management system to tighten occupational health supervision, create a safe and comfortableworking environment and conditions for employees, and eectively protect the health of all employees. The Companyhas passed ISO 45001 "Occupational health and safety management systems" certi?cation.
The Company strictly implements the requirements of work safety laws and regulations, fully practices the work safetypolicy of "safety ?rst, prevention ?rst, and comprehensive management", constructs the safety risk control system andthe hidden danger investigation system to improve safety standardization and information construction. Through regularrisk assessment, the Company can correctly determine the main dangers and harmful factors in equipment and facilities,and propose control measures and protective measures in time. Meanwhile, the Company has made a work safetyemergency plan, to standardize emergency management and emergency response procedures and improve emergencyresponse capabilities.
Employee safety and health
Occupational health management
Strengthening work safety
In order to improve the safety awareness, self-rescue, ?rst-aid and mutual-rescue skills of all employees, the Companyprovided 6 AEDs in office and production buildings, and organized the head, employee representatives and keyemployees of each department to conduct ?rst aid knowledge and practical training. All participants were active in thetraining, conducted simulation exercises interactive Q&A on the stage, and ?nally passed theoretical and practical tests.
In order to prevent and resolve major safety risks from the source and improve employees' safety awareness and safetyliteracy, the Company organized members of the safety committee to study the new Work Safety Law. After the training,all members were clear about the work safety responsibility system that industry management, business managementand production and operation management must allow for safety.Case
Case
Emergency drill.
Work safety training.
LAZZEN launched a ?rst aid knowledge drill
LAZZEN organized training on the Work Safety Law
Data performance
Data performance
During the reporting period, the number of occupational disease patients in the Company was 0 and theoccupational health examination rate was 100%.
During the reporting period, the Company has organized 2 work safety trainings and 1 safety drill.
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2022 Environmental, Social and Governance (ESG) Report
The Company has set up a talent development center, aiming at enabling the best to cultivate the even better, withthe purpose of driving performance, so that the training is closely linked to job requirements and performance targets.In addition, the Company focuses on the needs of core talents and professional team, continues to improve the talenttraining system, constantly establishes and improves the classified training mechanism covering all employees, andcarries out characteristic training programs for employees of all levels and categories.
To cope with the Company's strategic development requirements and further expand the career promotion space of theemployees, the Company has developed relevant systems based on the competency & quali?cation mechanism to build acomplete and fair career growth path and promotion channels, which help evaluate, select, and cultivate excellent middleand senior managers and tiered talents for the Company as well as providing targeted guidance and assistance foremployees in terms of career development.
Sta training and development
In order to help new employees quickly integrate into theCompany, get familiar with the corporate culture, integrateinto the team, know the business activities and processesand reach the expected performance in the shortest time,the Company organized new employee induction training,which included 13 sessions and covered 34 participants.
Orientation training for new employees.
Data performanceDuring the reporting period, the Company has organized 176 training courses, with a total of 279.5 hours.
Working together to create asustainable ecosystem
The Company actively constructs an active procurement organization, pursues value procurement and strategicprocurement, and builds a safe, ecient, and open supply chain ecosystem. By preparing system documents includingthe SOP for Supplier Access Certi?cation, the Hierarchical Supplier Management Measures and the Supplier PerformanceManagement Measures, the Company further optimizes the supply chain management system, and deeply improves thecentralized procurement mechanism, to ensure that the products purchased meet the required quality standards, thatthe procurement process complies with relevant laws and regulations, and that safe and eective products are producedstably. Meanwhile, the Company works with suppliers to ful?ll social responsibility.In accordance with laws and regulations including the Bidding Law of the People's Republic of China, the Company hasestablished a sound procurement management system and implementation rules, advocated open procurement, andsigned the Honest Cooperation Agreement, to protect the basic interests of suppliers. In terms of sustainable supplychain management, the Company sets up ESG audit projects when introducing suppliers, requires suppliers to graduallytransform their production lines, and guides those who do have diculty in transforming production lines to take goodprotection measures.All cooperative suppliers should sign the Supplier Social Responsibility Commitment, which covers environmentalprotection, work safety, labor management and other items that must comply with all national and local environmentallaws and regulations, including:
· Freedom of association and collective bargaining· Anti-discrimination· Compensation and bene?ts· Working hours, workplace health and safety
· No child labor· No forced labor or disciplinary measures· Environment safety
Lean supply chain management
In order to standardize supplier entry quali?cation, a CEG consists of supplier development engineers, R&D engineers/technical engineers, and SQE/CE, which fully reviews and evaluates new suppliers through qualification certification,system certi?cation and product certi?cation, to ensure material availability, procurability, cost and support capacity.
Supplier quali?cation management
Driving performance
Pangu Academy
Teachingand researchteam leadInstructorsIndustry chaincommunication platformUniversity-enterpriseexchange meetingConsultation ontransformation projectsYoung designer trainingbase
Trainingsecretary
LAZZEN Talent Development Center
Course levels
Edison Academy
WIN PlanConstruction of the internalinstructor resource pool
Introduction of external
resourcesLAZZEN People Training
Mainly based on the fourth level(business experts - level 27 to 30)
Internal trainings to iron triangles
Mainly based on the third level(business backbones - level 23 to 26)Mainly based on the second level(primary forces of grassroots -level 19 to 22)
Panshi Academy
LAZZEN course libraryOnline learning platformPBC + position ful?llment
Lean AcademyTalent Academy
1. Key position
quali?cation
2. Management
position training
3. Senior management
training
External resource platformsMine training needsDesign trainingReview trainingcoursesEvaluate trainingeects
DevelopcoursewareDeliver trainingcoursesQ&A andexamsOrganize trainingTrack aftertrainingFeed back eects
Case
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2022 Environmental, Social and Governance (ESG) Report
In order to dynamically manage suppliers, ensure that suppliers can complete orders on time and with high quality andmeanwhile select quality suppliers, the Company has developed and implemented the Supplier Performance ManagementMeasures, monitors and evaluates the daily performance of existing suppliers in quality, delivery, technology and business,can maintain good cooperative relations with suppliers, improve the predictability of operations of the entire supplychain, and avoid adverse eects arising from emergencies.
To promote healthy competition and build a long-distance running partner group, the Company has developed andimplemented the Hierarchical Supplier Management Measures, divides suppliers into strategic suppliers, preferredsuppliers, quali?ed suppliers, restricted suppliers and eliminated suppliers according to the availability of the supplier'sproducts, the Company's share in the supplier's customers, the supplier's emphasis on the Company and the supplier'sasset investment, and improves management eciency through dierentiated management measures.
Supplier performance management
Hierarchical supplier management
In line with the customer demands-oriented service concept, the Company attaches great importance to improvingcustomer satisfaction, continuously improves the customer service system and service standards, constantly improvesservice quality, protects the basic interests of customers, actively provides customers with convenient, considerate andspecial services, and strives to create a better service experience for customers.
Standardizing customer service
To cooperate with Sungrow to complete wind power and PV technological transformation, establish a complete servicechain with the customer, and enhance customer satisfaction, the Company actively responded to the customer'srequirements. Through video guidance, telephone communication, on-site processing，the Company reached thecustomer immediately, identi?ed the failure, and distributed materials in time to solve on-site quality issues, reduce theloss of power generation due to customer downtime, maximumly ensure the orderliness and timeliness of after-sales,which was praised by Sungrow's Wind Energy Division in writing.
To meet the customer's need for technical upgrading of circuit breakers in a wind power project, the Company dockedwith the user end on site at the ?rst time, fully communicated and implemented four measures and two plans, ensuringthe steady implementation of the technical transformation plan so as to eliminate potential operation risks for thecustomer and improve the safety and reliability of the operating circuit of the wind turbine. Through the accumulatedservice experience of major new energy customers, the Company upgraded the service to new energy primarycustomers to service by dedicated personnel, and allocated on-site after-sales docking personnel according to customerbusiness volume so as to maximize the orderly and timely after-sales of market products.
Case
Case
LAZZEN solved customer issues with professionalism and received customersatisfaction with sincerity.
Technical transformation and upgrading of circuit breakers for customer'swind power project.
On-site failure identi?cation for the wind power project
Wind power project site with power cut and technical transformation and upgrading
Carry out project management throughthe IPD process, conduct technicaldiscussions based on ITMT, and ensure theimplementation of customer demands.
Broaden after-sales service channels,such as WeChat official account,telephone, and email.
Customerservice
Improve the mechanism of connectingand promoting the resolution of majormarket issues.
Further construct distributors' after-sales capabilities, conduct skill trainingfor service personnel, and establishnation-wide after-sales service outlets.
Set up a big division and streamlineafter-sales services.
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2022 Environmental, Social and Governance (ESG) Report
In 2022, the Company's isolating switch delivery team responded quickly against difficulties based on the customer-centric principle by providing closed management in the factory, costly logistics arrangements, helping lower-levelsuppliers resume work and oering o-site warehouse storage to support the delivery of products to Huawei. In thisregard, Huawei specially sent a letter of appreciation to the isolating switch delivery team.
Case
Guaranteed production and delivery.
Letter of appreciation from Huawei's Digital Energy Procurement Team
Under the backdrop of a complex external environment, the Company focuses on target market segments andbenchmark customers with industry in?uence through resource allocation and eective internal coordination, meets thedierentiated requirements of customers using the IPD model, and continuously enhances the core competitiveness ofmarketing. In addition, the Company has achieved a comprehensive digital upgrade of its internal work?ow, whereby toenable customers using digital and to enable customers with solutions.
Creating an ecient marketing system
Core marketing competitiveness
To consolidate its market position, the Company continuously drives marketing management transformation, strengthensthe marketing network, and enhances channel competitiveness. In addition, based on the qualifications of sales andmarketing employees and dierences in their performance, the Company's Pangu Academy designs a training coursesystem that matches job requirements and is committed to cultivating project manager-type and solution-orientedmarketing teams, creating disciplined, coherent and marketing specialists with strong execution.
In strict accordance with the Anti-Unfair Competition Law of the People's Republic of China, the Advertising Law andthe Contract Law of the People's Republic of China and other laws and regulations and regulatory requirements, theCompany has developed the Sales Policy, whereby to standardize product release, sales and other aspects, forbid thespread of misleading and ambiguous product information. The Company actively popularizes knowledge to protectcustomers' right to know.
Enhancing marketing capabilities
Responsible marketing
In order to implement the Company's policy of "marketing-oriented, leading products, synergy, and performance-driven",better enhance the stability and sense of belonging of the 2022 management trainees, and build up a good corporateimage, the Company specially launched the 2022 WIN program training camp, which included 67 sessions and covered39 participants.
Case
Marketing training.
Marketing sta training organized by the Company
Quick response. Seize marketopportunities and invest a lotof resources in improving newproduct R&D and solutions.
Relatively complete sales networkand structure. From regions toindustries, from channels to designinstitutes, from operations to internalbusiness platform departments.
Excellent sales model. Target headcustomers and carry out long-term cooperation with leadingcompanies in the industry.
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2022 Environmental, Social and Governance (ESG) Report
Given that the Advertising Law became effectiveon September 1, 2022, in order to standardize thecompliance part in promoting external products, theCompany organized the Notes for the 2022 NewAdvertising Law for drills, a move to significantlyenhance all employees' awareness of compliancewith the Advertising Law.
Case
Advertising law training.
Training and drill on the Notes for the 2022 New Advertising Law
organized by the CompanyWorking together to drive industrydevelopmentGeneral Secretary Xi Jinping emphasized in the Report of the 20th National Congress of the Communist Party of China that "Wewill promote closer enterprise-led collaboration between industries, universities, and research institutes, stay goal-oriented, andpromote the industrial application of scienti?c and technological advances". The Company constantly strengthens the collaborationbetween industries, universities, and research institutes, deepens cooperation with well-known universities and research institutes,forms an overall environment for mutual promotion, and injects new momentum into industrial transformation and upgrading.
Deepening mutually bene?cial cooperation
For the purpose of further combination of industries,universities, and research institutes with the help of externalintellectual resources, the Company has set up the Post-Doctoral Research Center and developed the ManagementMeasures of the Post-Doctoral Research Center to standardizepostdoctoral management. As of the end of the reportingperiod, the Company had cooperated with the center for post-doctoral studies of Hebei University of Technology and Xi'anUniversity of Technology. Two post-doctoral students cameto the Post-Doctoral Research Center and worked on thefollowing two topics respectively: A Study on the Current ArcMathematical Model for Inflatable DC Contactors for ElectricVehicles and Charging Piles; A Study on the Development andKey Technologies of Hybrid Solid-state Switch. This will alsoplay a strong role in helping the Company with the cooperationbetween industries, universities, and research institutes, furtherenhancing technological innovation capabilities, and promotingthe application of scienti?c research results.
Case
Further combination of industries, universities, and research instituteswith the help of external intellectual resources.
Post-Doctoral Research Center sign of the Company
As a leading company in low-voltage apparatus, the Company, when developing rapidly, remembers to drive industrydevelopment. It has taken multiple measures to actively promote industry innovation, and is committed to becoming aleader in the development of the industry to achieve mutual bene?t and common development.
Advancing industry exchanges
The Company has proactively participated in formulation and revision of national standards and industry standards toimprove the technical level of the low-voltage apparatus industry.
The Company has an interest in taking part in industry activities, including publishing professional papers and holdingindustry forums, aiming to improve professionalism and help the industry develop in a green, low-carbon, and intelligentdirection with high quality.
Developing industry standards
Industry activities
No.Standard No.Standard NameStandard Type1GB/T 41911-2022
Power Frequency Overvoltage Protective Devices (POPs) for
Household and Similar Applications
National standard2GB/Z 41909-2022
Low-voltage Switchgear and Controlgear—ElectromagneticCompatibility Assessment for Switchgear and Controlgear and Their
Assemblies
National standard3GB/T 14048.23-2022
Low-voltage Switchgear and Controlgear—Part 9-1: Active Arc-fault
Mitigation Systems—Arc Quenching Devices
National standard4GB/T 14048.22-2022
Low-voltage Switchgear and Controlgear—Part 7-4: Ancillary
Equipment—PCB Terminal Blocks for Copper Conductors
National standard5GB/T 16895.22-2022
Low-voltage Electrical Installations—Part 5-53: Selection and Erectionof Electrical Equipment—Devices for Protection for Safety, Isolation,
Switching, Control and Monitoring
National standard6GB/T 41589-2022
In-cable Control and Protection Device for Mode 2 Charging of Electric
Road Vehicles (IC-CPD)
Industry standard7T/CES 146-2022Health Management for Low Voltage Circuit-BreakersGroup standard
Standard formulation and revision participated by the Company in 2022
Data performanceDuring the reporting period, the Company has participated in the formulation and revision of 7 standards whichhaven been issued afterwards, including 5 national standards, 1 industry standard, and 1 group standard.
5758
2022 Environmental, Social and Governance (ESG) Report
In order to learn about innovations in latest products in digitalization, smart power distribution and new energy, fullydiscuss and exchange with peers, and work together to help China achieve Carbon Peaking & Carbon Neutrality goalsand establish the new power system dominated by new energy, the Company attended the 2022 8th China SummitForum on Electrical Appliance and Energy Eciency Management Technologies, actively contributing to helping China'snew energy and electrical manufacturing develop sustainably and rapidly.
In order to deeply explore the technical issues identi?ed in academic research and practical work and drive the upstream anddownstream industrial chain to upgrade technologies, the Company attended the 2022 21st Academic Year of the CES SpecialCommittee on Low-Voltage Electrical Apparatus and the 17th China Intelligent Electrical Technology Forum and InternationalSymposium on the Development and Application of New Solid-State Circuit Breaker Technology to upgrade expertise andlearn about the latest development of new solid-state circuit breaker technology after on-site exchanges. The Companycontributed 5 papers, including 1 paper grant the Excellent Paper Award and 2 papers brought to on-site exchanges.
Case
Case
Focus on smart power distribution and green energy, plan for theCarbon Peaking & Carbon Neutrality blueprint.
Linkage to the two associations for the future together.Summit Forum on Electrical Appliance and Energy Eciency Management Technologies
Paper exchanges17th China Intelligent Electrical Technology Forum and
International Symposium on the Development andApplication of New Solid-State Circuit Breaker Technology
2022年度环境、社会及公司治理（ESG ）报告
案例
案例
聚焦智慧配电与绿色能源，谋划双碳蓝图
双会联动，共见未来
CASE
CASE
“电器与能效管理技术”高峰论坛会
论文交流第十七届中国智能电工技术论坛暨固态新型断路器技术
发展及应用国际研讨会
We shall not forget our original intention.
We shall live up to our youths.In 2023, let's seize new opportunities and
increase innovation advantages.We shall keep passionate and unite in aconcerted eort to win the future and move
towards to the future.
Future expectations
5960
2022 Environmental, Social and Governance (ESG) ReportList of KPIs
Social Performance
KPIsUnitDataTotal number of employeesPerson2211(By education level)
Doctorate degreesPerson1
Master's degreesPerson111Bachelor’s degreesPerson1,137Associate degreesPerson487Below associate degreesPerson475(By position)
Production personnelPerson790
Sales personnelPerson700Technical personnelPerson546Finance personnelPerson30Administration personnelPerson145Supply chainmanagement
Percentage of suppliers signing the
code of conduct
%100Percentage of newly selected suppliersmeeting the environmental standards
%100Percentage of selected suppliersmeeting the social standards
%100Industry standards(issued)
National standardsItem5Industry standardsItem1Group standardsItem1
Corporate Governance PerformanceKPIsUnitDataOperation of the three
meetings
BOD meetingSession6Board of supervisors meetingSession6Shareholders' meetingSession4Intellectual property
Newly applied patents in the yearItem286Newly granted patents in the yearItem388Research anddevelopment
Number of R&D personnelPerson546Amount of R&D investment Yuan269,966,102.06
Economic PerformanceKPIsUnitDataTotal assetsYuan5,704,549,372.33Net assetsYuan3,743,438,761.43Operating revenueYuan4,157,068,010.2Net pro?t attributable to shareholders of listed companyYuan421,767,410.71
Basic earnings per shareYuan per share0.4Net cash ?ow from operating cativiesYuan461,148,142.85
Environmental Performance
KPIsUnitDataEnvironmental protection investment10,000 yuan60Energy consumption
Natural gasCubic meter46,217SteamCubic meter1,163.03Renewable energyKilowatt hour1,688,602Emission of gaseouspollutants
Particulate mattermg/cubic meter0.39
Non methane total hydrocarbonmg/cubic meter0.54
VOC emissionsmg/cubic meter0.54Discharge of water
pollutants
Chemical oxygen demand (COD)mg/L338
Five-day biochemical oxygen
demand (BOD5)
mg/L103Suspended solidsmg/L88Ammonia nitrogenmg/L36.9Waste discharge
Total amount of general solid
waste
ton380Total recyclable wasteton380
6162
2022 Environmental, Social and Governance (ESG) ReportIndex of KPIs
Table of ContentsGRI StandardCASS-ESG5.0
About This Report
102-46, 102-50, 102-51, 102-52,102-53, 102-54
P1Message from Our Chairman102-14, 102-15P2
About LAZZEN
102-1, 102-2, 102-4, 102-5-7,102-16-18, 102-22, 201-1
P4ESG Management
102-21, 102-40, 102-42, 102-43,102-44, 102-46
G3Special Topic onResponsibilities
Quality services102-6P3Intelligent factory203-1, 203-2P3Process management103-1, 103-2, 103-3P3
GovernanceResponsibility · Pursuitof Excellence
Continuously improvinggovernance
102-18, 102-22, 102-27, 103-2G1.1, G1.2Strengthening risk compliance
management
102-30G1.3, G1.4Building a strong ?rewall forinformation protection
418-1S5Strengthening intellectualproperty protection
G1.3EnvironmentalResponsibility · Greenand Low Carbon
Green management: quali?cation
certi?cation
301-2, 302-4, 303-2, 306-2, 307-1E1Green manufacturing: cleaner
production
301-3, 303-2, 303-4, 306-3, 306-4, 306-5E3Green oce: low-carbon life203-2, 302-4, 302-5, 303-3E2.14, E2.15
Social Responsibility ·Win-win Cooperation
People-oriented to realize
employee value
102-7, 102-8, 102-35, 201-3, 401-1,
401-2, 403- 1, 403-4, 404-2, 405-1
S1, S2Working together to create a
sustainable ecosystem
102-9, 308-1, 308-2, 414-1, 414-2,417-1, 417-2
S6Working together to drive
industry development
413-1, 413-2S5Future expectations102-14A1Appendixes
Index of KPIs102-55A4
Feedback102-53A5
Feedback
Thank you very much for spending your time to view the 2022 Environmental, Social, and Corporate GovernanceReport of Shanghai Liangxin Electrical Co., Ltd. To continuously improve our CESG management, reporting quality, ESGcapabilities and levels, we sincerely invite you to provide invaluable comments and suggestions on this Report. We willfully consider your comments and suggestions and promise to properly protect your information from any third party.
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2022 Environmental, Social and Governance (ESG) Report