CONTACT US
Xingtong Shipping Co., Ltd.Address: Floors 8-9, Xingtong Shipping Building, No. 295 Yifeng East Road,Quangang District, Quanzhou City, Fujian Province, ChinaTel.: 86-0595-87777879Website：http:/www.xtshipping.comPostcode: 362800
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2023XINGTONG SHIPPING CO., LTD.ENVIRONMENTAL, SOCIAL, ANDGOVERNANCE (ESG) REPORT
XINGTONG SHIPPING CO., LTD.Stock Code603209 SH.
Printed with recycled paper
CONTENTS
Feedback FormOutlook69-70
About This Report
General Manager's Message
11-16
Strengthen Governance toLay a Solid Foundation forDevelopment
ESG Governance and ManagementRisk ManagementBusiness Ethics and Compliance
Prioritize Safety forLong-term Sustainability
Improve the Safety Management SystemDevelop Safety Culture and PracticesImplement Safety Measures
29-36
Contribute to CommunityDevelopment Continuously65-68
Protect Basic RightsTalent Attraction and DevelopmentBuild a High-Caliber CrewFoster a Supportive Work Environment
53-64
Share Success withEmployees
01-10About Xingtong Shipping
Company Pro?leBusiness Development Strategy2023 HighlightsHonors and Awards
17-28
Create a Win-Win EcosystemJointly
Strengthen Shipping Capacity To Facilitate E?cientChemicals Logistics Lead the Industry with Exceptional Services
Responsible Sourcing for Mutual Bene?tsJointly Build a Robust Ecosystem through Collabora-tion
Champion Green Developmentfor A Sustainable Future
Strengthen Environmental ManagementRespond to Climate ChangeConserve Marine Ecology
37-52
XINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
ABOUT THIS REPORT
Reporting Period
This Report covers the period from January 1st to December31st, 2023, and includes additional information beyond thestated reporting period.Included EntitiesThis Report covers Xingtong Shipping Co., Ltd. and its subsid-iaries. For ease of expression and reading, Xingtong ShippingCo., Ltd. is also referred to as "Xingtong Shipping", "Xingtong","the Company" or "we", and XT-IMC Shipping Co., Ltd. isreferred to as "XT-IMC" in this Report.
Reporting CycleThis annual report is the second iteration of Environmental,Social, and Governance (ESG) Report released by the Compa-ny since its establishment.
Data SourceAll the information and data included in this Report comefrom publicly disclosed materials and related statistics ofXingtong Shipping.ReferencesThis Report is prepared with reference to the United NationsSustainable Development Goals (SDGs), the SustainabilityAccounting Standards Board (SASB) Standards, the GuidelinesNo. 1 for the Application of Self-regulatory Rules of CompaniesListed on the Shanghai Stock Exchange—Standardized Operation(Revised in December 2023), and the Notice of the ShanghaiStock Exchange on Strengthening the Social Responsibility ofListed Companies.
Reliability AssuranceThe information presented in this Report is accurate, reliable,and adequately addresses the concerns which are relevant toour stakeholders. Furthermore, it provides an objectiverepresentation of our Company's social responsibility perfor-mance.
The Forms of The ReportThe Report is available in both Chinese and English versions.The Chinese version shall prevail in case of any misunder-standings caused by the translation and cultural or traditionaldi?erences. The authenticity of this report is tenable regard-less of these misunderstandings.The Report is released in print and digital formats. It isavailable for online query and downloads via the followinglink:http: //www.xtshipping.com/Contact Us
Xingtong Shipping Co., Ltd.Address: Floors 8-9, Xingtong Shipping Building, No. 295Yifeng East Road, Quangang District, Quanzhou City, FujianProvince, ChinaPostcode: 362800Tel.: 86-0595-87777879Fax: 86-0595-87088898Email: securities@xtshipping.cn
Report Compilation Process
Data Collection - Framework Planning - Compilation andDesign - Internal Review - Revision and lmprovement - TopManagement Approval
External TopicCollectionDistribution andDissemination
Report Release
Topic Collection
Topic SelectionReportPreparationFeedback Collection
IndustryBenchmarking
Survey &Interviews
StakeholderOpinionsinternal ReviewMateriality Analysis
The petrochemical sector is a key economic pillar for China, essential for the country's transformation towards a manufacturer of quality, while theshipping of hazardous liquids is an integral part of the petrochemical supply chain logistics. On September 25th, 2023, President Xi Jinping highlighted inhis congratulatory letter to the Global Sustainable Transport Forum that "Building a safe, convenient, e?cient, green, economical, inclusive and resilientsustainable transportation system is an important step in supporting the high-quality development of the economy and society. It is also important inensuring the easier movement of people and the smoother ?ow of goods." As a leading company in China's chemicals shipping sector, Xingtong Shippinghas steadfastly held to its mission and original vision for 26 years. While focusing intensively on its core business, the Company has consistently re?ned itsapproach in market development, customer service, safety management, and capacity enhancement, always striving to lead and innovate in its ?eld. Ourvision is to "Become a leading integrated service provider for the chemicals supply chain, both domestically and internationally".
Expand Horizons Together: Tap into the Growth of the Blue Economy
Following the "1+2+1" development strategy, we made steady and substantial progress, resulting in an expansion of our ?eet's carrying capacity in 2023.That was achieved through our strategic acquisition of XT-IMC in March, and our top-scoring performance in the Ministry of Transport's assessment ofshipping companies for ?eet carrying capacity control, which earned us approval for an additional 3.7 KDWT for our chemical tankers. Meanwhile, the?eet was further expanded by commissioning six newly constructed or acquired ships. By December 31st, 2023, we operated 33 bulk liquid chemicaltankers, product tankers and LPG carriers (excluding ships under construction) with a total capacity of 384.9 KDWT. The volume of cargo we shippedannually exceeded ten million tonnes for the ?rst time.In 2023, we ventured into the international shipping sector, aligning our e?orts with the broader goal of strengthening China's maritime capabilities. Weestablished 14 wholly-owned subsidiaries, including Xingtong Hainan, Xingtong Hong Kong, and Xingtong Singapore. Within just a year since the launchof our international chemicals transportation service in November 2022, we have managed to o?er both voyage and time charter services to globalpetrochemical clients. Our routes span from East Asia and the Middle East through the Mediterranean to the Atlantic and the Americas. By December 31st,2023, we had six ships operating along international routes with a combined capacity of 97.2 KDWT, and ?ve more such ships under construction with acombined capacity of 89.8 KDWT. We are committed to "Building a top-tier, large, and in?uential shipping ?eet", poised to navigate the boundlessopportunities of the deep blue ocean.Benchmark Against the Best: Sharpen Competitive Edge in Safety ManagementTo facilitate the safe, green, healthy, and orderly development of the hazardous chemicals shipping sector, regulators have set strict standards forchemical logistics companies regarding service certi?cations, safety policies, and sta?ng. Our company consistently adheres to the highest standardsand stringent requirements. Since our safety management system's launch in 2002, we have adopted key performance indicators and best practices fromthe Tanker Management and Self-Assessment (TMSA) program, aiming for continuous improvement of the system to align with internationalbenchmarks, high criteria and standardization. We are dedicated to improving customer services and building a positive comprehensive social brandreputation through our excellent safety management capabilities and performance. We highly invested in safety and has achieved good safetyperformance as well. We have been awarded the "Business of Safety and Integrity" by the Maritime Safety Administration and has been e?ective for sixconsecutive years. Additionally, ten of our ships have been named "Ship of Safety and Integrity", and twelve captains have earned the title of "Captain ofSafety and Integrity." This widespread recognition fuels our ongoing commitment to excellence in ship safety management.
Talent-Driven Growth: Make Xingtong Shipping a Talent MagnetThroughout our development, employees stand as our most valuable asset. We recognize that our progress and achievements hinge on the dedicationand innovation of every team member. Therefore, we are committed to nurturing talent, enhancing our systems, and enriching our corporate culture,making Xingtong Shipping a top talent magnet. We aim to create a work environment that is inclusive, supportive, and foster personal development,where every employee feels a profound sense of achievement and belonging.Since its establishment, we have worked to deepen emotional connections with our crew members by extending care to their families, o?ering support-ive policies, improving crew welfare and bene?ts, and cultivating a ?eet culture. These approaches have consistently enhanced the crew's sense ofidentity and well-being. We believe that by focusing on the growth and well-being of our employees, we can not only attract and retain the best in theindustry but also unlock our team's potential, propelling the Company towards even greater success.The year 2023 was pivotal for the implementation of the "14th Five-Year Plan." It also marked the 10th anniversary of the "Belt and Road" Initiative, and amilestone of high-quality development for Xingtong Shipping. As we look to the future, our spirits are buoyed by con?dence and anticipation. With a longjourney ahead, it is time to seize opportunities and navigate towards our dreams. We will remain steadfast in sustainable development, constantlyseeking and applying good practices and embracing global partners with open arms. Together, we will pave the way for a promising future for thechemicals logistics and shipping industry.
Pioneer the Future: Advance Towards a Greener, Low-Carbon FleetIn 2023, the International Maritime Organization (IMO) revised its Strategy on Reduction of GHG Emissions from Ships, with a goal of achieving net-zeroemissions across the global shipping industry by around 2050. In an active response to the global emission reduction strategy and the national "dualcarbon" policy, we have proactively expanded our ?eet with younger, technologically advanced, and environmentally friendly ships.We have actively collaborated with China Classi?cation Society, design institutes, and main engine manufacturers, among others, to advance the designof our dual-fuel ships, and achieved signi?cant results. In August, we signed contracts for the construction of two 25.9 KDWT methanol dual-fuel stainlesssteel chemical tankers. In October, "XING TONG 96" received the Green Eco-ship certi?cation granted by the China Classi?cation Society. By continuouslyenhancing the environmental performance of our ships and improving energy e?ciency management, we strive to provide our customers with sustain-able and low-carbon logistics solutions and contribute to China's ambitious "dual carbon" goal.
As for international ship management, we are closely collaborating with top-tier ship management ?rms, OSM Thome and International Marine Carriers(IMC). We aim to excel in safety, quality, and technological innovation, thereby enhancing our service to global petrochemical clients. Continuousinvestment and upgrades in safety management have won us market recognition and ?rst-class brand reputation.
GENERAL MANAGER'S MESSAGE
General Manager of Xingtong Shipping
XINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
ABOUT XINGTONG
SHIPPING
XINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
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主要业务Business Overview
After years of growth, Xingtong Shipping has established itself as a leading company in the coastal shipping of bulk liquid chemicals in China,playing an eminent role in the market segment. By December 31st, 2023, the Company operated 33 bulk liquid chemical tankers, product tankersand LPG carriers (excluding ships under construction), boasting a total capacity of 384.9 KDWT. Speci?cally, 27 ships with a capacity of 287.7 KDWToperated for domestic trade, and 6 ships with a capacity of 97.2 KDWT operated for international trade. In addition, 7 ships with a capacity of 101.0KDWT were under construction. Among them, 2 ships with a capacity of 11.2 KDWT are for domestic routes, and 5 ships with a capacity of 89.8KDWT are for international routes.Our routes in China cover not only the coastal areas, but also the middle and lower reaches of the Yangtze River and the Pearl River, forming atransportation network that connects major domestic chemical industrial bases including Bohai Bay, Yangtze River Delta, Pearl River Delta andBeibu Gulf. We handle a variety of petrochemicals, including xylene, liquid alkali, methanol, ethanol, ethylene glycol, pure benzene, aviationkerosene, gasoline and diesel, butadiene, and butane. Our clients include petrochemical giants such as Sinopec, CNOOC, CA, PetroChina, ZPC,CSPC, Wanhua Chemical, and Shenghong Re?ning & Chemical. We have repeatedly won recognition and titles such as "Service Provider ofStrategic Partnership", "Excellent Supplier", and "Excellent Service Provider" from our downstream customers.Our international transport services cover regions including Northeast Asia, Southeast Asia, the Middle East, the Mediterranean, Northwest Europe,South America, and the Indian Ocean. We mainly ship cargoes such as ethylene glycol, phenol, diethylene glycol, styrene, palm oil, and base oil forour clients, including PETROBRAS, SABIC, RELIANCE, RAFFLES, ICOF, ENOC, PETRONAS, and SIPCHEM, etc.
Established in December 1997 with a registered capital of RMB 280 million, Xingtong Shipping specializes in the coastal and international shippingof liquid hazardous goods in bulk. Since March 24th, 2022, its shares have been listed on the main board of the Shanghai Stock Exchange under thestock code 603209. The Company ranks among the Top 3 shipping businesses in Fujian Province, and serves as Deputy Director of the ChinaShipowners' Association (CSA) Chemical Transport Committee, Vice President of the Dangerous Chemical Logistics Branch of China Federation ofLogistics & Purchasing, Executive Director of China Petroleum Circulation Association, Vice President of Fujian Shipowners' Association, andPresident of Quanzhou Shipowners' Association.
Ten Tenets
COMPANY PROFILE
Vision
To become a leading integratedservice provider for the chemicalssupply chain, both domesticallyand internationally, with ?rst-rate?eet, services, management, team,and culture
To create value for our customers,investors, employees, and societywith safe, e?cient and trustworthyservices
People centricity, innovation, valuecreation, and pursuit of excellence
ValuesMission
Contribute to thenational develop-ment throughmaritime business
O?er superiorservices byalways puttingcustomers ?rst
Hold safety as thelifeblood of thebusiness and payclose attention todetailsBenchmarkagainst the topplayers and worktogether to deliver?rst-rate servicesRemain true to our originalaspiration and uphold theprinciples of integrity,humility, solidarity, andhard work
Be pragmatic,productive,innovative, andresponsible
Strive for continuousimprovement throughself-evaluation, insteadof perfection
To forgeiron, onemust bestrong
Concentration,commitment,professionalism,and expertise
Show reverencefor responsibility,regulations, andlife
ABOUT XINGTONG SHIPPINGXINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
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In 2023, the Company continued our commitment to the "1+2+1" development strategy. We purchased and built ships to increase the capacity of ourchemical tanker ?eet in order to consolidate our leading position in the domestic transportation of bulk liquid chemicals by water, expanded our ?eet ofLPG carriers for domestic routes, and enhanced our capabilities to serve the international market. In the future, we will continue to develop our corebusiness and increase our brand awareness.Under the guidance of the "Belt and Road" Initiative and the 14th Five-Year Plan for Water Transport Development, and driven by the vision of becoming aleading integrated service provider for the chemicals supply chain both domestically and internationally, Xingtong Shipping actively engages in theinternational hazardous chemicals shipping and strengthens its future-oriented customer service capabilities with our aim of growing into a globallycompetitive and renowned shipping company.
Xingtong Shipping’s "1+2+1" Strategy
BUSINESS DEVELOPMENT STRATEGY
Continuously strengthen our core strength in the domestic transport of liquid hazardous goods, consolidating ourleading position in the industry and increasing our brand awareness
Create a digital platform for chemical supply chain logistics，consistently promoting digitalization and the applicationof technological innovation
1 Core
1 Platform
Explore the ?eld of clean energy transportation, and actively engage in international shipping competition
New Field New Direction
ABOUT XINGTONG SHIPPINGXINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
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The major asset restructuring of XingtongShipping was completed following itsacquisition of a controlling interest in XT-IMC.The information of the acquired companyregistered at the local administration formarket regulation was changed, and its?nancial statement was consolidated
into that of Xingtong Shipping
In March 2023
Xingtong Shipping was listed amongthe 2023 top 100 private enterprises
in QuanzhouIn September 2023
The 8.8 KDWT stainless steelchemical tanker " XING TONG 96"made its maiden voyageIn October 2023
"XT PEACE", Xingtong Shipping's 5th
chemical tanker for international
routes, was put into operationIn December 2023Xingtong Shipping signed contractsfor building two 25.9 KDWT methanoldual-fuel stainless steel chemical
tankers
In August 2023
Xingtong Shipping obtained an InterimDOC (Document of Compliance), a type
of International Safety Management(ISM) Code Certi?cation
In August 2023
"XT PROGRESS", Xingtong Shipping's4th chemical tanker for internationalroutes, was successfully delivered and
put into operation in Singapore
In August 2023
In December 2023
The o?ce of Xingtong shipping(singapore) pte ltd. was o?cially put
into operation
In November 2023The ships "XT PROSPERITY" and "XTBRIGHTNESS" were successfully
launchedIn October 2023The 5,200 m3 LPG carrier " XINGTONG 359" was put into operation
2023 HIGHLIGHTS
ABOUT XINGTONG SHIPPINGXINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
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HONORS AND AWARDS
Recognition from government authorities and the industryRecognition from clients
Deputy Director of the Fourth China Shipowners' Association Chemical Transport Committee"2023 China Chemical Logistics Industry 'Golden Tank Award' for ESG & Sustainability Management",presented by China Federation of Logistics & PurchasingRole Model in 2022 Fujian Province"Ankang Cup" Competition, awarded jointly by the Fujian Federation of TradeUnions and the Fujian Provincial Department of Emergency Management
"Business of Safety and Integrity", recognized by the Maritime Safety Administration of the People's Republic ofChina (for six consecutive years)
"Over RMB 100 million taxpayer in 2023", recognized by the CPC Committee of Quangang District and the
People's Government of Quangang District
"Excellent Logistics Service Provider in 2022" presented by the South China Branch of Sinopec Chemical Commer-
cial Holding Company Limited
"2022 Service Provider of Strategic Partnership" awarded by Rongsheng Petrochemical Co., Ltd.
"Excellent Carrier in 2023" granted by CNOOC South China Sales Co., Ltd."Excellent Supplier in 2022" recognized by Fujian Re?ning and Petrochemical Co., Ltd.
ABOUT XINGTONG SHIPPINGXINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
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An e?cient governance mechanism is fundamental for a compa-ny to achieve its operational goals and long-term vision. XingtongShipping rigorously adheres to the governance standardsrequired of listed companies, and embraces a business philoso-phy centered on "integrity, compliance, and win-win coopera-tion." The Company is committed to continuously enhancing itsgovernance framework to improve its governance capabilitiesand overall performance.
STRENGTHEN
GOVERNANCE TO LAY A SOLID FOUNDATIONFOR DEVELOPMENT
XINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
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Organizational Structure of the Company
Materiality Matrix单船公司
Board of Supervisors
监事会
Partially-Owned Subsidiary andEquity Investment
Board Secretary
General Meeting of Shareholders
Board of Directors
Strategy CommitteeAudit CommitteeNomination CommitteeRemuneration and AppraisalCommitteeSafety and EnvironmentalProtection Committee
XT-IMC Shipping Co., Ltd.
Shenzhen COSCOLPG Shipping
Co., Ltd.
51%15%Xingtong Shipping
(HK) Co., Ltd.
Xingtong Shipping(Hainan) Co., Ltd.Xingtong Shipping(Singapore) Pte. Ltd.SPV company
Wholly-Owned Subsidiaries
OperationsCenter
Ship ManagementCenter
FinanceCenter
InternationalBusiness Center
Procurement and HumanResources Center
In 2023
Key performance highlights:
We held 5 general meetings of shareholders, 12 board meetings, and 11 supervisory board meetings.These sessions primarily focused on proposals such as major asset restructuring, re?nancing, policyrevisions, and ship construction. All resolutions were passed
Material Topics
We operate in the highly specialized and risk-intensive transportation ofliquid hazardous goods in bulk, which is characterized by signi?cant entrybarriers, stringent regulatory oversight, and exacting standards. The Boardhas instituted a Safety and Environmental Protection Committee, compris-ing three directors and further supported by a dedicated working group ledby our Marine Safety O?cer. This committee supervises our managementpractices in safety and environmental protection, o?ering crucial supportfor board-level decisions in these areas.
ESG GOVER-NANCE ANDMANAGEMENT
主要业务Material Topic Analysis and UpdatesIn June 2023, the International Sustainability StandardsBoard (ISSB) issued the IFRS S1 General Requirements forDisclosure of Sustainability-related Financial Information andIFRS S2 Climate-related Disclosures. Xingtong Shippingpays close attention to the publication of internationalsustainability disclosure standards. We adhere to thede?nition of material topics in the ESG Reporting Guideissued by the Hong Kong Stock Exchange, and incorporatethe key topics identi?ed by the SASB Standards for themaritime transportation industry. This enables us to re?neour materiality focus based on the foundational workconducted in 2022. Our goal is to more e?ectively meetexternal expectations and highlight the disclosure of thesematerial topics in our Report.
Talent attractionand retention
ECategory
G
S
Category
S
TopicRegulatory complianceResponse to climate changeMarine ecosystem protectionEnhancing shipping capacity
Health and safety
TopicExcellent customer service
Supplier managementTalent attraction and retentionCrew development and welfareCommunity relations
President (General Manager)Vice President (Deputy General Manager)Director/Chief Captain
Audit DepartmentCrew DepartmentHuman Resources DepartmentProcurement DepartmentTechnical Support DepartmentSafety and SupervisionDepartmentInternational OperationsDepartmentInternational BusinessDepartmentFunding DepartmentShip Inspection DepartmentSafety and Quality DepartmentEngine DepartmentMarine DepartmentOperations DepartmentMarket DepartmentLegal and Risk Control
DepartmentDigitalization DepartmentInvestment ManagementDepartmentSecurities Department
General Manager's O?ce/Ad-
ministration DepartmentFinance Department
Shipbuilding ManagementDepartment
Signi?cance to Business Operations
Communityrelations
Supplier management
Crew development and
welfareResponse toclimate changeEnhancing shipping capacity
Marine ecosystem protection
Health and safety
Excellent customer
serviceRegulatorycompliance
Signi?cance to Stakeholders
STRENGTHEN GOVERNANCE TO LAY A SOLID FOUNDATION FOR DEVELOPMENTXINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
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We are dedicated to elevating our corporate responsibility governance and competitiveness. With a clear focus on crafting a compelling XingtongShipping narrative, highlighting our brand, increasing our visibility, and generating value, we proactively communicate and interact with keystakeholders, including governments, regulatory agencies, shareholders, and clients. Our goal is to enhance the transparency of our informationsharing and response to concerns, fostering a path toward the sustainability of both our Company and the wider community.
In 2023
Key performance highlights
In 2023
Key performance highlights
Xingtong Shipping experienced no ethics and compliance missteps,nor did it incur any ?nancial losses due to legal actions related to bribery or corruption
Xingtong Shipping strictly adheres to the Company Law of the People's Republic of China, Securities Law of the People's Republic of China and otherlaws and regulations on anti-corruption, anti-fraud, anti-money laundering, and anti-sanctions. We consider integrity to be a key element of ourcompetitive edge and a vital "intangible asset" for maintaining a positive public image. Accordingly, we have integrated this principle into our tentenets. We have also woven compliance requirements into our strict internal control system, and enforced stringent regulations on the conduct ofour board of directors, supervisory board, and senior management team.
主要业务Stakeholder Communication
Government/Regulatory bodies
Shareholders
Employees
Community
Environment
ClientsSuppliers
Peers/NGOs/Industry organizations
Media
Tax complianceEmployment promotionRegulatory compliance
Enhance communication with governments/regulatory bodies
Release regular reports and ESG reports
Promote steady corporate growthRegulatory complianceBusiness integrity managementRisk management and internal control
Business development strategy
Hold shareholder meetingsRelease regular reports and ESG reportsBasic rights protectionHealth and safetyCareer development
Crew welfare
Host wage negotiation and communication sessions
Ensure occupational health and safetyO?er competitive payment and bene?tsProvide various employee training programsEstablish a "Seafarers' Home"Community contributionInvest in community development initiativesEnergy conservation and carbon emission reduction
Waste dischargeMarine ecosystem protection
Improve environmental managementImplement energy-saving and emission-reduction initiatives
Protect marine ecosystemDevelop eco-friendly shipsSafe and reliable logistics services
Excellent customer service
Enhance shipping capacity
Ensure reliable and safe transportationProvide green, low-carbon shipping optionsFair, just, and open procurementIndustry developmentTransparent communication
Provide equal opportunitiesConduct responsible procurementParticipate in industry forums and meetingsMake timely release of reports and information
Xingtong Shipping integrates the essentials of risk management into its corporate governance and operational work?ows, establishing a "threelines of defense" approach to risk management.
The ?rst line of defense consists of the business units andthe Safety and Quality DepartmentWhich are responsible for evaluating clients andsuppliers and enhancing our safe production systems.The second line is formed by the Legal and RiskControl DepartmentWorking in tandem with third-party legal teams at homeand abroad to build a comprehensive and robust legaland risk management defense.
The Audit Committee of the Board of Directors and theAudit Department constitute the third line of defense
Aiming to strengthen risk prevention and controlthrough a solid internal audit system.
RISK MANAGEMENT
BUSINESS ETHICS ANDCOMPLIANCE
In 2023, the Company has updated the ContractManagement System and its implementation require-ments, and drafted the Overseas Anti-Corruption Policyand the Anti-Money Laundering Statement. Additionally,we undertook various risk management trainings,which included specialized trainings on topics ofSigning and Executing International Charterparties,Legal Risk of Online Promotion, EU&IMO ShippingRegulations, and Navigation Safety ,and contract legalrisk management training for all our shore-basedemployees.
StakeholderMain ConcernsOur Response
We hosted 38 online forums, 46 in-person meetings and 3 performance brie?ngs, enabling investors,the media, and others to gain a timely, comprehensive, and unbiased understanding of the Company’soperations
STRENGTHEN GOVERNANCE TO LAY A SOLID FOUNDATION FOR DEVELOPMENTXINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
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With our sights set on the sea, we aim to contribute to the national developmentthrough shipping business. Xingtong Shipping strives to become a leading integratedservice provider for the chemicals supply chain, both domestically and international-ly. Through scienti?c management, specialized operations, and extensive experience,we fully dedicate ourselves to the safety and stability of the chemicals supply chain,and work with diverse stakeholders to build an industry ecosystem that thrives onwin-win collaboration.
CREATEA WIN-WIN ECOSYSTEM JOINTLY
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By December 31st, 2023
the Company (along with its subsidiaries) had 33 in-service ships,with a combined capacity of
384.9 KDWT
Key performance highlights
The Ministry of Transport unveiled the 14th Five-Year Development Plan for Water Transport in 2022. This blueprint advocates for a maritime ?eetthat is scalable, well-structured, technologically advanced, smart and eco-friendly, and encourages shipping enterprises to enhance their services.Under the guidance of industry policies, China's waterborne transport is growing in lockstep with the country's ascent as a maritime power,unlocking new opportunities for shipping companies. Amidst the complex and ever-changing international landscape, we tackle challengeshead-on, seize market opportunities, and fully implement our "1+2+1" strategy to move faster towards sustainability, high quality, and greengrowth.
主要业务Boost Shipping Capacity
STRENGTHEN SHIPPING CAPACITY TO FA-CILITATE EFFICIENT CHEMICALS LOGISTICS
The ongoing growth of China's petrochemical sector has led to a stable expansion in the coastal transportation of liquid hazardous goods in bulkand a continued increase in shipping volume. Our established expertise and extensive experience in the maritime transportation of bulk liquidhazardous chemicals have allowed us to develop a strong shipping network that is perfectly aligned with the demands of the downstreamindustry.Xingtong Shipping has a strong foothold in the domestic shipping industry. We navigate the length of China's coastlines, including strategic stretch-es into major rivers. This expansive network connects the key chemical industry hubs in the Bohai Bay, Yangtze River Delta, Pearl River Delta, andBeibu Gulf. Our operations cover China's major ports, from Liaoning, Hebei, and Tianjin in the north to Guangdong, Guangxi, and Hainan in thesouth.In 2023, we expanded our ?eet with six ships (84.4 KDWT in total), of which four were for international routes and two for domestic trade. Further-more, our strategic acquisition of XT-IMC added six more chemical tankers, increasing our capacity by an additional 41.0 KDWT.
Xingtong Shipping's Domestic Shipping Routes
CREATE A WIN-WIN ECOSYSTEM JOINTLYXINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
2019
Xingtong Shipping's International Shipping Routes
主要业务Enhance Global CompetitivenessThe demand for domestic chemicals shipping increases as numerous large integrated re?ning and chemical projects are progressively launchedin China. Furthermore, the relocation of the global re?ning and chemical hub towards Asia, coupled with the global expansion of China's re?ningand chemical industry, is fueling a sustained increase in the demand for international chemicals shipping. As we continue to reinforce our leadingposition in domestic chemicals transportation, we have also fully embarked on international operations, aiming to provide our global clientelewith e?cient, safe and reliable shipping services.Our services, which are provided on voyage charter and time charter, span from East Asia and the Middle East through the Mediterranean to theAtlantic, covering continents from Asia to Europe, Africa, and South America. By December 31st, 2023, we had six ships operating along internation-al routes with a combined capacity of 97.2 KDWT, and ?ve more such ships under construction with a combined capacity of 89.8 KDWT.
Ship Quantity and Capacity by Type
Shipping Volume and Freight Turnover
Chemical tankerProduct tankerLPG carrierChemical tankerProduct tankerLPG carrier
11.5
58.7
314.7
QuantityShipping Capacity (in KDWT)
11,104.18,145.66,155.1
Total shipping volumn (kilotonne)
202320222021
ChemicalsOil productLPG
Classi?ed shipping volumn (kilotonne)202320222021
4,299.0 1,856.1
7,704.13,230.6 169.4
5,349.5 2,701.6 94.5
4,992.14962,118.77731,639.5271
Freight turnover (million tonne-miles)202320222021
Notes: The shipping volume data includes freight statistics of self-owned ships under voyage charter or time charter, and leased ships under voyage charter.
巴西
北京
Ho Chi MinhBangkokDu MaiJNPTKandlaQasimJubailDamiettaMarmaraKuleviGenovaTarragonaAveiroRotterdamGdanskGrangemouthStanlow
SantosAcu
Singapore
舟山RotterdamRotterdam
SingaporeSingapore
DavaoSahabat
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Our investment in research and development for theyear 2023 amounted to RMB
1.5394 million
"XT PROGRESS" Was Put into Operation in August
主要业务Deepen Transformation Toward Digital and Smart SystemsResponding to the national call for green, low-carbon, and intelligentshipping development and catering to the evolving needs of the Compa-ny, we push the envelope with the next generation of informationtechnology in the transportation of liquid hazardous goods. We dive intothe application and exploration of "Digital shipping and smart ships, andextend these technologies into the supply chain". Through initiatives likethe "Shipping Platform"and Shipping E?ciency and Innovation Lab, weuse port and maritime big data analytics to boost the operationale?ciency of our ships.
Improve Resource Allocation Through Digital Applications
Utilizing the data analysis and visualization capabilities of Business Intelligence (BI) systems, we can look into key data for "Opera-tions, crew, fuel consumption, and market" to assess our business performance, operational e?ciency, and customer satisfaction,while also identifying potential risks and tracking market dynamics. This allows us to ?ne-tune our operations, sharpen corecompetencies, and improve delicacy management practices
Business Intelligence Systems
We have developed a comprehensive digital management platform that covers ship management, shipping logistics, materialsprocurement, and ?nancial systems. This platform ensures complete tracking of ships and cargo, o?ering real-time, extensiveinformation support. This has enabled e?cient integration of port and shipping information, as well as visibility and control overthe entire lifecycle of cargo transport to signi?cantly improve the operational e?ciency and safety of our shipsWe have incorporated a proprietary 48-hour anchorage alert feature, derived from the Kingdee System. This feature keeps an eyeon the anchoring status of ships and uses algorithms to issue prompt warnings about the length of anchorage, thereby boostingoverall operational e?ciency
Digital Shipping
By integrating ship management systems, Automatic Identi?cation Systems (AIS), and Electronic Chart Display and InformationSystems (ECDIS), we are able to dynamically track geographical, weather, and navigational data to signi?cantly improve the safetyand reliability of maritime navigation
Smart Ships
"XT PEACE" Was Put into Operation in December
Key performance highlights
"XT BRIGHTNESS" Was Successfully Launched in November
"XT PROSPERITY" Was Successfully Launched in November
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In 2023
we received20 satisfaction survey responses, which yielded a customer satisfaction rate of 98.69%
No customer complaints were reported throughout 2023
We have designed e?ective customer satisfaction metrics that "Must accurately re?ect needs, must be implementable, and must be measurable."These metrics focus on key areas such as shipping service quality, team service e?ciency, and the handling and feedback of complaints. Everyyear, we send satisfaction surveys to our top 20 clients to get their feedback.
In response to the evolving trends for greener, lower-carbon, and smarter shipping operations, and ever stricter safety and environmentalregulations, chemical companies are raising their expectations for the professional expertise and safety management skills of logistics carriers. AtXingtong Shipping, we "Put customers ?rst and remain committed to innovation." Our service tenet is "Every employee strives to achieve serviceexcellence and puts customer's needs as top priority." By identifying and addressing our customers' unique requirements, from reducing cargodamage and boosting port e?ciency to o?ering fast emergency responses, we provide shipping services that excel in e?ciency and quality.
In 2023, we further enhanced our services through the implementation of an internal control system designed for our shipping services. Thissystem outlines clear service standards across all business activities, from market development and requirement veri?cation to contractexecution, order review, and shipment tracking. Leveraging delicacy management approaches and strategic scheduling, our professional teamsmaintained low cargo losses, o?ered rapid responses, and ?exibly organized resources, promptly meeting our customers' unique requirements.
LEAD THE INDUSTRY WITH EXCEPTIONALSERVICES
Recognitionfrom clients
"Service Provider of Strategic Partnership in 2022" by Rongsheng Petrochemical Co., Ltd."Excellent Logistics Service Provider in 2022" by the South China Branch of Sinopec ChemicalCommercial Holding Company Limited"Excellent Carrier in 2023" by CNOOC South China Sales Co., Ltd."Excellent Supplier in 2022" by Fujian Re?ning and Petrochemical Co., Ltd.
Emergency response
During maiden voyageprojects for large re?ning andchemical businesses, we haveprovided prompt support fortheir emergency responseplans, ensuring uninterruptedchemicals supply chain forour clients
Schedule management
Our schedule is underpinned byadvanced ship scheduling,precise port arrival data analysis,e?cient port operations,e?ective communication withcustomers, and seamlessinternal coordination, all ofwhich align to ful?ll ourcustomers' shipping timelines
Minimizing cargo losses
In view of the liquid hazardousgoods characterized by ?ammability,volatility, and toxicity, we implementrigorous management of our ships'equipment, ensure optimal shipperformance and constantlyimprove the professional skills of ourcrew, so that the Company's cargoloss rate is at a low level
Key performance highlights
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Key performance highlights
While continuously improving our management systems, Xingtong Shipping fully considers and evaluates our suppliers' ESG performance at thestage of identi?cation evaluation, and o?boarding, including safety, environment protection, labour, etc..We champion sustainability in our procurement practices. With regard to critical materials like fuel oil, ship supplies, and ship repair materials, weprefer products that are energy-e?cient, have a longer lifespan, and produce minimal waste. Whenever possible, we opt for products marked withthe class notation for ecological protection (G-ECO). For international ship management and marine crew services, we require our suppliers topresent certi?cations that detail the labor rights and special operation permits, among others, to ensure compliance with regulations on labor ben-e?ts, occupational health and safety, and welfare protection. In our ?ght against corruption, we mandate that suppliers sign an Integrity Coopera-tion Agreement, strictly prohibiting all forms of bribery. In 2023, we introduced internal control systems for newbuilding supervision and fuelprocurement.
We believe that building a sustainableindustry ecosystem requires synergyamong all stakeholders involved. Posi-tioned as a leading player in China'scoastal shipping market of bulk liquidchemicals, Xingtong Shipping proac-tively seeks out opportunities for deepengagement and exchange with indus-try associations, regulatory bodies,and fellow companies to contribute toa vibrant industry ecosystem.
KPI
Total number of suppliers
131107
Range of supplier evaluation (%)100100Range of core suppliers signing the Integrity Cooperation Agreement (%)100100Range of core suppliers receiving on-site inspection (%)
52.929.2
20232022
March 2nd, 2023
We attended the parallel forum of the 9th National Chemi-cal Logistics Industry Annual Conference, on the theme of"Focusing on Smart Logistics and Forecasting FutureTrends"
September 25th, 2023
We received a visit from the China Shipowners' Associa-tion, and presented an overview of our ?eet, crew devel-opment, and advantages in safety management. Together,we engaged in discussions about chemical transportation
May 25th, 2023
We shared our perspectives on the future of the chemicalsshipping market at the Enmore Maritime ConferenceSeptember 26th, 2023
We engaged in reporting and discussions with the FujianMaritime Safety Administration, Quanzhou MaritimeSafety Administration and Quangang Maritime SafetyBureau about our special campaign for "Major hazardidenti?cation and correction", along with safety workduring the Mid-Autumn Festival and National Day holidaysNovember 23rd, 2023
We participated in the "Safe and Green Chemicals Logis-tics in China" event organized by the China Federation ofLogistics & Purchasing Hazardous Chemicals LogisticsBranch. We delved into topics such as carbon emissionpolicies, China's energy structure, shipping business andship safety management
December 20th, 2023We attended the shipping sub-forum at the 2023 LogisticsService Provider Conference held by the South ChinaChemical Sales Branch of PetroChina Company Limited
Supplier EvaluationBased on the Supplier Scoring Standardsand the New Supplier Assessment Form,we conduct annual checks and evalua-tions of our suppliers' quali?cations. Ourassessment covers their performance inquality, health, safety, and environmentalmanagement, along with the certi?cationand implementation of the relatedsystems and the energy e?ciency of theirproducts. These constitute the basis forupdating our list of quali?ed suppliers
Supplier Approval
Before approving a supplier, werequire them to provide certi?-cations for quality, safety, envi-ronmental protection and laborrights, as well as special opera-tion permits, to ensure thequality of materials and theprotection of labor rights
Supplier Management
Supplier Selection
We select top-tier suppliersbased on their certi?cations,industry recognition, and man-agement expertise, and sharethem with our peers to helpmitigate ESG risks at the sourceof the supply chain
JOINTLY BUILD A ROBUST ECOSYSTEMTHROUGH COLLABORATIONRESPONSIBLE SOURCING FORMUTUAL BENEFITS
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Safety is the foundation upon which the hazardous materialsshipping industry thrives and evolves. Without safety, we wouldnot be able to provide superior shipping services, let alonemaintain our competitive edge for sustainable growth. In everyaspect of our shipping operations, safety comes ?rst. At XingtongShipping, safety for ships, cargo, crew and their families is ashared value for all.
PRIORITIZESAFETY FOR LONG-TERM SUSTAINABILITY
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We believe that our international, rigorous, and standardized safety management system gives us a competitive edge in o?ering secure, eco-friend-ly, and superior shipping services to our customers. Xingtong Shipping rigorously adheres to relevant international and domestic laws, regulations,and conventions. We ensure our management philosophy and patterns are on a par with those of top global chemical shipping companies,conduct in-depth exchanges and cooperation in ship safety management with the world's leading ship management companies, and incorporateinternational standards and the world's leading safety management experiences to continuously improve our safety management system.
The Safety and Environmental Protection Committee is set up under the Board of Directors. The General Manager assumes primary responsibilityfor workplace safety, aligning safety goals and primary tasks with the corporate policy. The management team sets safety objectives and strategiesto ensure these objectives are achieved. The Marine Department and Engine Department manage and implement safety metrics and continuouslyenhance the safety skills of our entire workforce.Additionally, we have incorporated the TMSA—a safety management tool widely recognized in the international shipping market. This has elevatedand standardized our safety management, environmental stewardship, emergency preparedness and response, as well as reliability and mainte-nance planning. Our ships have passed inspections by large domestic and international oil companies , including SHELL, BP, PETRON, CNOOC,Sinopec and PetroChina in the Ship Inspection Report Program (SIRE) , and by the Chemical Distribution Institute (CDI).
IMPROVE THE SAFETY MANAGEMENTSYSTEM
ZeroCargo LossesZeroDetentionsZeroPollutionZeroCasualtiesZeroAccidentsLong-termSafetyManagementGoals
2002
Implemented theSafety ManagementSystem (SMS)
2003Received the DOC andShip ManagementCerti?cate (SMC) from theFujian Maritime SafetyAdministration
2012
Adopted the TMSA program developedby the Oil Companies InternationalMarine Forum (OCIMF)
2015
Obtained certi?cations for ISO 9001Quality Management System, ISO 14001Environmental Management System, andOHSAS 18001 Occupational Health andSafety Management System
2019Established our Safety and QualityManagement System (SQMS) based onTMSA key performance indicators andbest practices
2023Passed the TMSA vetting inspectionconducted by clientsAchieved a Certi?cate in Standardizationof Safe Production (Level 1)Passed the DOC replacement audit
Safety Management Certi?cation
认证名称认证机构认证有效期
Domestic DOC replacement auditFujian Maritime Safety AdministrationMay 5th, 2023 - May 24th, 2028Annual assessment of standardization forsafety management in transportation and
logistics enterprises
China Classi?cation SocietyApril 28th, 2022 - April 27th, 2025Quality management system
certi?cate
Southeast Standard Certi?cation CenterFebruary 6th, 2024 - February 5th, 2027Occupational health and safety manage-
ment system certi?cate
Southeast Standard Certi?cation CenterFebruary 11th, 2022 - January 29th, 2025
International DOC interim auditFujian Maritime Safety AdministrationSeptember 1st, 2023 - August 31st, 2024
Environmental management
system certi?cate
Southeast Standard Certi?cation CenterFebruary 11th, 2022 - January 29th, 2025
NameIssuing AuthorityValidity Period
Development of The Company' s Safety Management
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Safety is a universal language for everyone at Xingtong Shipping. We encourage our employees to draw on their experience to develop a safetyculture. "Holding safety as the lifeblood of the business and pay close attention to details" has become one of our top ten tenets. Our safety sloganscan be found in every nook and cranny of each ship, reminding all employees to always maintain a sense of safety and vigilance.We believe that prevention is better than cure. Safety training is pivotal in boosting our employees' safety awareness and skills. Knowing this, wehave put in place monthly safety and quality management protocols, conducted specialized training sessions analyzing common accidents, ando?ered learning opportunities in various formats, such as micro-classes and vacation training programs. Additionally, by adopting the 5S method-ology for on-site management, we have enhanced our safety management e?ciency for shipboard operations.
Emergency Drill Onboard
In the 22nd National Safety Month, Xingtong Shipping adoptedthe theme that "Safety & Emergency Preparedness is Everyone'sResponsibility" and engaged all employees in online knowledgecontests, specialized training, and more. To e?ectively improvesafety awareness and skills among shore-based employees, theCompany invited the ?re rescue team of Quangang District toprovide emergency training in ?re safety and evacuation.
"Safety & Emergency Preparedness is Everyone'sResponsibility" National Safety Month ActivityCase
5S5S management system
Seiri
Seiton
Shitsuke
SeiketsuSeiso
It refers to ?ve words beginning with the Roman phonetic "S" of the Japanese words
DEVELOP SAFETY CULTURE ANDPRACTICES
PRIORITIZE SAFETY FOR LONG-TERM SUSTAINABILITYXINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
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Transporting hazardous liquids by sea entails high risks, as ships may encounter maritime accidents due to collisions, running aground, ?res, orexplosions. There is also a chance of safety incidents resulting from improper handling during tank cleaning, cargo operations and otherprocedures. Recognizing that risk identi?cation and control is a vital approach to avoiding accidents, we have implemented a comprehensive riskmanagement strategy that involves pre-voyage risk assessments, real-time monitoring throughout the voyage, and post-voyage reviews, ensuringthat risks are well kept in check.We have set up and continually improved the dual warning procedure that encompasses hierarchical risk management and hazard identi?cationand correction. In 2023, we launched the 2023 Special Action Plan for Major Hazard Identification and Correction, and revised our standards on thetwo-faceted approach to risk prevention (hierarchical risk management and hazard detection and resolution), and on the identi?cation,evaluation, and operational control of occupational health hazards. Furthermore, in response to the requirements for international shipping, weupdated our policies on navigation, occupational health, and equipment operation.
KPIUnit20232022
Minor accidents/0 0Work-related fatalitiesPerson
0 0Work-related fatality rate%0 0Days lost to work-related injuriesDay0 0Lost time injury frequency rate permillion working hours
Incident/millionworking hours
0 0
Safety incidents that createminor liability
/
0 0
Safety incidents that createsigni?cant liability
/0 0Safety incidents that createmajor liability
/
0 0
Investment in work safetymillion RMB11.808 10.3084
On September 26th, 2023, Xingtong Shipping was awarded the "Business of Safety and Integrity" title by theMaritime Safety Administration, for the sixth consecutive yearFive of its ships, XING TONG 66, XING TONG 16, XING TONG 19, XING TONG 56, and XING TONG 6, were recognizedas "Ship of Safety and Integrity" by the Maritime Safety AdministrationSix captains were honored as "Captain of Safety and Integrity" by the Maritime Safety AdministrationXingtong Shipping was named a Role Model in 2022 Fujian Province "Ankang Cup" Competition, awarded jointlyby the Fujian Federation of Trade Unions, the Fujian Provincial Department of Emergency Management and theHealth Commission of Fujian Province
Honors and
Awards
In 2023
Key performance highlightsIn 2023 ships of Xingtong Shipping passed25 inspections in SIRE and by CDIIMPLEMENT SAFETY MEASURES
Implement Safety Measures
Improve Hierarchical Risk Control1
Systematically identify, categorize, and manage risk sources, andperiodically review the Risk Management Handbook to promptlyupdate mitigation strategies for newly identi?ed hazardsIn 2023, we introduced risk assessment for operations involvingphenol and for new international shipping routes, and establishedtargeted risk management measuresUpdated the International Ship Cargo Handling Manual
Minimize Safety Hazards2
Update the Risk List and the Risk Assessment and ControlManualEnsure all risks are e?ectively managed and continuousimprovement is made through various approaches, includingrequiring shore-based managers to make ship visits or joinvoyages and conducting ship self-inspectionsCarry Out Specialized Safety Inspections3
Establish a steering group for major accidents prevention activities,consisting of the General Manager (head), Deputy General Managerand the Chief Captain (deputy heads), and heads of all functionalareas (members)Perform risk screening for 7 major hazards, such as those concerningcrew allocation, signi?cant unauthorized ship alterations, andnavigation under extreme weather or adverse sea conditions
Enhance Emergency Response4
Establish an emergency management system consisting ofemergency management protocols, contingency plans, and theEmergency ManualRevise the Annual Ship-Shore Drill Plan based on the Five-YearPlan for Ship-Shore Drills to include all emergencies identi?ed bythe Company over the past ?ve yearsIn 2023, four ship-shore drills were conductedStrengthen Safety Management Through Digital Applications
Leverage digital solutions to enhance risk management during sea voyages. This includes employing weather navigation systems (SPOS, WNI),onboard surveillance system, HiFleet tracking system and other digital platforms for real-time monitoring, weather guidance, and risk alerts
Key performance highlights
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The shipping industry, which hinges on the oceans, is shifting towards more sustain-able practices. Xingtong Shipping actively supports the IMO Strategy on Reduction ofGHG Emissions from Ships, pioneering innovative environmental management anddeveloping energy-e?cient and low-carbon technologies to minimize the maritimefootprint of its operations and throughout its value chain. Xingtong Shipping isdedicated to the protection of marine ecosystems, moving towards a greener, low-car-bon and sustainable future.
CHAMPION
GREEN DEVELOPMENT FOR A SUSTAINABLEFUTURE
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Xingtong Shipping aligns its operations with international and national environmental standards, including The International Convention for thePrevention of Pollution from Ships (MARPOL), Marine Environment Protection Law of the People's Republic of China, Regulations of the People's Republicof China on the Prevention and Control of Marine Pollution from Ships, Administrative Provisions of the People's Republic of China on the Prevention andControl of Marine Environmental Pollution by Ships and Their Operations, and Administrative Measures on Ship Energy Consumption Data and CarbonIntensity. The Company remains steadfast in re?ning its environmental management system and sets robust management indicators andobjectives to continuously monitor and enhance its environmental performance in day-to-day operations. Within the reporting period, XingtongShipping and its subsidiary, XT-IMC, have both obtained the ISO 14001: 2015 Environmental Management System Certi?cation.The Safety and Environmental Protection Committee under the Board of Directors supervises our management practices in safety and environ-mental protection. The General Manager assumes primary responsibility for environmental management a?airs, ensuring that environmentalconsiderations are e?ectively woven into the fabric of the Company's routine operations and business development process.
Engine DepartmentSafety and Quality DepartmentMarine Department
Approves the Company's environmental protection and energy conserva-
tion plans and measures.General Manager
Implement measures for pollution prevention, energy conservation and emission reductionRegularly review and improve energy conservation and emission reduction practices
Report any pollution hazards, risks, and incidents
Ships
To enhance the energy e?ciency and reduce carbon emissions of our ?eet, we have established an Energy Conservation and Emission ReductionManagement Procedure. The document speci?es the departments that take ownership of these e?orts and outlines the management processes.The General Manager is responsible for approving all energy-saving and emission-reduction plans and measures company-wide. The EngineDepartment develops the Ship Energy Efficiency Management Plan and provides related guidance and monitoring throughout the process. Thisincludes ensuring that ships collect and submit energy e?ciency data every month and perform a comprehensive assessment of their energy-sav-ing and emission-reduction e?orts every half year. The Marine Department analyzes the performance of ships in energy conservation and emissionreduction and, based on the results, optimizes the annual targets and measures for the next year.
Key environmen-tal management
measures
Implement Environmental Responsibilities
Systematically identify and continuously monitor various pollutants on shipsPerform thorough analyses of potential environmental hazards associatedwith di?erent operations and establish speci?c control measuresDevelop emergency protocols for various pollution eventsConduct regular testing and maintenance of anti-pollution equipment
Enhance Management
Annually reassess and update environmental protection and energy conservationplans, and regularly review, analyze, and revise environmental management indicatorsand targetsProvide all employees with comprehensive training and instruction regarding theCompany's environmental targets and strategiesLaunch "mini-lessons" to enhance crew members' knowledge and skills throughregulatory training and case study discussions
Manage Environmental Risks
Ensure all employees are fully aware of the company’s environmentalprotection policies, goals, procedures, and their individual responsibilitiesKeep accurate records and promptly review all worksheets related toanti-pollution and energy management e?ortsOversee the pollution control of ships through onboard inspections,remote checks, and third-party auditsIncorporate environmental KPIs into the metrics for managerial sta?assessment
Develops environmental protection, energyconservation plans and measures, and con-duct full reviews every half yearOversees and assesses ships' energy con-servation and emission reduction practices;Monitors pollution prevention and energye?ciency in the engine roomSupports the resolution of technical andequipment issues related to pollution pre-vention
Investigates environmental risks in o?cesettingsSummarizes and comprehensively assessesvarious environmental risks to identifymajor environmental hazardsDevelops environmental protection plans andstrategies for preventing ship-produced pollution;Investigates environmental risks on boardOversees and inspects the ships' pollution pre-vention practicesMonitors and evaluates energy conservationand emission reduction during navigation andcargo operationsReports any problems about ships' anti-pollu-tion practices and pollution incidentsOptimizes energy saving and emission reduc-tion targets and measures
Environmental Management Organizational Structure And Duties
STRENGTHEN ENVIRONMENTALMANAGEMENT
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Climate-related Risks and Opportunities
RESPOND TO CLIMATE CHANGE
Climate change response is one of the most signi?cant material topics for shipping companies. Identifying risks and opportunities is the founda-tion for developing climate change strategies. To this end, by combining the development trends of the shipping industry with our actualconditions, we have systematically identi?ed the transition risks, physical risks, and opportunities, along with their potential impacts that ouroperations and value chain may face in the short term (2024-2025), medium term (2026-2030), and long term (2031-2050).
Risk CategoryRisk Description
A?ected
Areas
TimeFrame
Potential Financial Impact -/+
Policy andlegal risks
The IMO Strategy on Reduction of GHG Emissions from Shipswas updated in July 2023 at the 80th session of the MarineEnvironment Protection Committee, setting ambitioustargets to reduce the GHG emission intensity of the globalshipping sector by at least 40% by 2030 and the total GHGemissions by at least 70%, or ideally 80%, by 2040, allbased on the 2008 levels.Regulations on ship GHG emissions are becoming increas-ingly strict. Ships will be obligated to quantify their GHGemissions and pay for an increasing percentage of theseemissions over time. For instance, the EU ETS applies tothe shipping industry from January 1st, 2024. It mandatesthat allowances equivalent to 40% of the emissions fallingunder the EU ETS must be surrendered for 2024. Thisnumber increases to 70% for 2025, and then to 100% thefollowing year and thereafter.
The amendments to MARPOL Annex VI establish the EnergyE?ciency Existing Ship Index (EEXI) and mandate thatmaritime authorities regularly evaluate the annual CarbonIntensity Indicator (CII) ratings of ships. These regulationsalso stipulate a continuous decrease in the annualoperational CII. In November 2022, China Maritime SafetyAdministration issued the Administrative Measures on ShipEnergy Consumption Data and Carbon Intensity, requiringships to regularly record and report their energy consump-tion data. Additionally, it requires the periodic assessmentof the annual operational CII ratings for ships engaged inthe international shipping business.This suggests a trend of increasingly tight regulations onship energy e?ciency and carbon intensity. Ships that failto comply with the EEXI and CII regulations are required tomake additional investments to cover assessments,retro?tting, and other improvements.
- Increase in operational costs(e.g., higher costs of purchasingcarbon credits and cleaner fuels)- Decrease in business income(e.g., decrease in internationalshipping orders due to therequirement for shippers tocover EU ETS surcharges)Operations/Downstream
Short term/Medium term/Long term
- Increase in construction costs(e.g., higher ship retro?ttingcosts)- Increase in operational costs(e.g., higher costs of shipmaintenance and training formanagerial and operationalsta?)- Impairment of ?xed assets (e.g.,premature scrapping of shipsthat do not meet CII require-ments)
Upstream/Operations/Downstream
Short term/Medium term/
Long term
Technicalrisks
- Increase in construction costs(e.g., higher cost of installingenergy-saving devices on ships)- Increase in R&D costs (e.g., highercost of developing newenergy-saving technologies andsystems)- Increase in operational costs (e.g.,higher cost of deploying newsystems and training managerialand operational sta?)
Upstream/Operations
Short term/
Medium term
Mandatory regulation and pricing mechanisms for GHGemissions from ships
Mandatory regulation on ship energy e?ciency andcarbon intensity
The R&D and application of direct or indirect ener-gy-saving technologies, such as drag reduction, enginee?ciency upgrades, and route optimization, willbecome mandatory requirements.R&D investment in ship energy-saving technologies
Climate-Related Risks
The EU Emission Trading System (EU ETS) is the European Union's strategy to reduce emission in response to climate change, and also the world'slargest multinational GHG emissions trading scheme. From January 1st, 2024, the shipping sector is formally incorporated into the EU ETS. Thisinclusion mandates that shipping companies purchase a percentage of carbon allowances, a ?gure that is set to rise year by year. To betterunderstand and comply with regional policy requirements related to our international operations, we have hosted a specialized training sessionon "EU & IMO Green Shipping Policies." This session provided detailed background information and speci?c requirements, ensuring the smoothoperation of our international businesses.
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- Increase in construction costs (e.g.,higher cost of purchasing cleanfuel-powered ships)- Increase in R&D costs (e.g., higher costof developing systems adapted toclean fuel-powered ships)- Increase in operational costs (e.g.,higher cost of deploying new systemsand training managerial andoperational sta?)
Upstream/Operations
Medium term/Long term
Short-termphysical risks
- Increase in construction costs (e.g.,higher cost of ship maintenance andrepairs)- Increase in insurance costs (e.g.,higher cost to cover ship and cargotransit insurance)- Decrease in business income (e.g.,contract breaches due to high cargodamage rates)- Impairment of ?xed assets (e.g.,premature scrapping of severelydamaged ships and equipment)
Upstream/Operations/Downstream
Long term
- Increase in operational costs (e.g.,higher cost to ensure ship operationale?ciency)- Decrease in business income (e.g.,contract breaches due to deliverydelays)Operations/Downstream
Long term
Long-termphysical risks
- Increase in operational costs (e.g.,higher spending on crew members'safety, psychological health, andhygiene management).Operations
Medium term/Long term
- Increase in operational costs (e.g.,higher spending on fast shipnavigation through ports);- Decrease in business income (e.g.,contract breaches due to deliverydelays)Operations/Downstream
Long term
- Increase in operational costs (e.g.,higher spending on ship operationale?ciency and crew safety);- Decrease in business income (e.g.,contract breaches due to deliverydelays)Operations/Downstream
Long term
Marketrisks
- Decrease in business income (e.g.,decrease in shipping orders forchemical products from China's coastalregions)DownstreamLong term
- Increase in operational costs (e.g.,higher cost of purchasing cleaner fuels)- Decrease in business income (e.g.,decrease in international shippingorders due to inability to providezero-carbon logistics services)Operations/Downstream
Long term
- Increase in operational costs (e.g.,higher cost of fuel purchases)OperationsMedium term
Reputationrisks
- Decrease in available capital (e.g., lessbank lending to the shipping industry)- Increase in operational costs (e.g.,higher cost of attracting and retainingsta?)- Decrease in business income (e.g.,decrease in international shippingorders)Upstream/Operations/Downstream
Short term/Medium term/Long term
- Increase in operational costs (e.g.,higher cost of expanding internationalroutes)- Decrease in business income (e.g.,decrease in shipping orders forchemical products from China's coastalregions)Operations/Downstream
Long term
Achieving net-zero emissions in the shipping industryhinges on transitioning ship fuels to zero-carbonalternatives. Signi?cant investment and extensiveresearch are urgently needed to promote the use ofclean fuel-powered ships and enable a gradualtransition towards a green ?eet.
Investment in clean fuel-powered ships
An uptick in the frequency and severity of extremeweather events, such as typhoons and tropical storms,may lead to signi?cant damage to ships, equipment, andcargo.Asset damages caused by extreme weather events
Frequent extreme weather events at sea complicate shipscheduling and route planning, cause damages to portfacilities, lead to long turnaround times and lowutilization rates of ships, interrupt transport activities onsome routes, and heighten the risk of contractual defaults.
Increased di?culty in navigating ships due to extremeweather events
Extended periods of high temperatures take a toll on thephysical and psychological conditions of crew members,undermining their health, e?ciency, and operationalsafety on board.
Impact of prolonged high temperatures on crewmembers' well-being
Rising sea levels disrupts unloading activities andberthing operations at existing ports and leads to adecreasing number of usable ports.Impact of rising sea levels on ship unloading andberthing operations
Fluctuating winds a?ect a ship's resistance and speed,adding to the di?culty of navigation and route planning.This variability also poses potential safety risks tooperations on board.
Impact of wind speed variability on ship navigation andon-board operations
The demand and shipment volumes for chemical rawmaterials may gradually decrease as resource utilizatione?ciency improves, leading to reduced market demand forchemicals shipping.Diminishing demand for chemicals shipping
Customers may show a preference for green, low-carbon,and even zero-carbon logistics services.Change in customer behavior
The price of fuel may soar as a result of carbon taxation andthe adoption of technologies to greener fuel technologies.
Rising ship fuel costs
The damages of high emissions from the shipping industryresult in negative in?uence to marine ecosystems andclimate, making it hard to attract and retain stakeholders,such as investors, banks, clients, suppliers, and employees.Damaged reputation of the shipping industry
The environmental oversight of the chemical sectortightens, alongside growing environmental awarenessamong customers and consumers. Companies may facesigni?cant risks in business operations if their emissionreduction and energy e?ciency measures fall short.
Tightened oversight and supervision in the chemical sector
Risk CategoryRisk Description
A?ectedAreas
TimeFrame
Potential Financial Impact -/+Risk CategoryRisk Description
A?ectedAreas
TimeFrame
Potential Financial Impact -/+
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Decarbonization is posing a grave challenge to the shipping industry. We closely monitor the latest technological advancements and trends inenergy e?ciency, environmental protection, and renewable energy development and application. By thoroughly analyzing climate-related risksand opportunities, we are setting a path for improvements in energy management and a gradual transition to clean energy adoption. Our aim is tobuild a green ?eet step by step.The key to reducing emissions in the shipping sector lies in the production and supply of alternative fuels, speci?cally the use of clean fuels. In thefuture, the selection of ship fuel will become a new and critical factor on business development. In 2023, Xingtong Shipping signed ship buildingcontracts with Wuchang Shipbuilding Industry Group Co., Ltd. and China Shipbuilding Trading Co., Ltd. for two 25.9 KDWT methanol dual-fuelstainless steel chemical tankers, an e?ort to advance the transition to green ?eets.
Develop A Green Fleet
+ Decrease in operational costs (e.g.,lower spending on maintaining ships'operational e?ciency)+ Increase in business income (e.g.,shortening ships' turnaround time andcompleting more orders)Operations/Downstream
Short term/Medium termResourcee?ciency
+ Decrease in operational costs (e.g.,less spending on fuel purchases)Operations
Short term/Medium term
+ Increase in available capital (e.g.,increased bank loans to support thegreen transformation of the shippingindustry)+ Decrease in operational costs (e.g.,spending cuts on waste gas treatmentand carbon credits)+ Increase in business income (e.g.,customers' preference for low-carbonshipping services)
Upstream/Operations/Downstream
Medium term/Long termEnergysource
+ Increase in available capital (e.g.,increased bank loans to support thegreen transformation of the shippingindustry)+ Decrease in operational costs (e.g.,spending cuts on waste gas treatmentand carbon credits)+ Increase in business income (e.g.,customers' preference for zero-carbonshipping services)
Upstream/Operations/Downstream
Medium term/Long termProducts andservices
+ Increase in business income (e.g.,increase in clean energy andchemicals shipping orders)Downstream
Medium term/Long termMarket
+ Increase in available capital (e.g.,increased bank loans to support thegreen energy transportation)+ Increase in business income (e.g.,increase in clean energy shippingorders and international shippingorders)Upstream/Operations/Downstream
Medium term/Long termResilience
Through R&D and the deployment of intelligent shipmanagement systems, we can optimize routes to cut theturnaround time of ships for greater e?ciency.Enhancing ships' operational e?ciency
We can raise our ships' energy e?ciency through retro?tsand the R&D and use of intelligent ship managementsystems.Improving ships' energy e?ciency
We can introduce dual-fuel ships that run on low-carbonsources such as methanol and LNG, and gradually increasethe use of cleaner energy.Adopting low-carbon energy
We can cater to the increasing demand for zero-carbonlogistics by running ships powered by zero-carbon fuels.Providing zero-carbon logistics
The manufacturing industry needs to undergo a greentransformation and industrial upgrading, leading to anincreased demand for clean energy and chemicalsshipping.Rising demand for clean energy and chemicals shipping
We can expedite the expansion of international routes andclean energy shipping services, e?ectively addressing thechallenges posed by the relocation of chemical supplychains and aligning with the shift towards clean energytransformation.
Diversifying operations
The Signing Ceremony For The Methanol Dual-fuel Stainless Steel Chemical Tankers
OpportunityCategory
Opportunity Description
A?ectedAreas
TimeFrame
Potential Financial Impact -/+Climate-related Opportunities
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KPIUnit20232022
Total energy consumptionMWh402,750.67126,006.23
Total fuel consumptionkilotonne34.410.8Fuel oilkilotonne25.210.8Diesel oilkilotonne9.2/Unit fuel consumptionkg/1,000 tonne-miles8.9010.13Gasoline (corporate vehicles)liter32,641.7434,563.01Total electricity consumption(o?ce use)
kWh216,862.00138,240.80Total GHG emissionstonnes of CO2108,046.7470,816.81
Scope 1 (proprietary ships)tonnes of CO2107,976.9534,054.92Scope 1 (corporate vehicles)tonnes of CO269.7973.89Scope 2 (electricity purchased foronshore o?ces)
tonnes of CO2123.6878.84Scope 3 (ships on time charter)tonnes of CO242,252.9636,683.05Scope 1 unit turnover emissionskg of CO2/1,000 tonne-miles27.9531.94Scope 3 unit turnover emissionskg of CO2/1,000 tonne-miles38.9134.85On October 19th, 2023, the 8,795 DWT duplexstainless steel chemical tanker" XING TONG 96"was awarded the Green Eco-ship Certi?cation bythe China Classi?cation Society. This certi?cationincludes the G-EP (SC, VCS) environmental markfor exceeding MARPOL standards in controllingdomestic wastewater and VOC emissions, and theG-ECO (CD11, BWM(T)) ecological mark forsurpassing MARPOL ballast water managementstandards and achieving an Energy E?ciencyDesign Index (EEDI) 11% lower than MARPOLrequirements.
"XING TONG 96" Receives Green Eco-ship Certi?cationCase
Energy-saving design for new ships
Alteration of existing ships for higher energy e?ciency
Optimize energy e?ciency managementBy harnessing the power of big data analytics in shipping and leverag-ing logistics information platforms, we optimize shift trim andminimize ballast water. We also select the most e?cient routes andmaintain ideal cruising speeds to reduce unit fuel consumption.
We also revamp ship boilers and waste heat recovery systemsto use waste heat for cargo insulation, thereby reducing fuelconsumption.
In the ship design and construction phases, we prioritizelightweight features and hull form optimization. We alsoout?t existing ships with energy-saving devices anddrag-reducing coatings. These e?orts aim to minimize shipresistance and boost energy e?ciency across our ?eet.Green ShipManagement andTechnologyEnhancement
Note:
The formula and coe?cients used to calculate ship GHG emissions are based on the IMO's 2014 Guidelines on the Method of Calculation of the Attained EEDI forNew Ships;For Scope 1 (corporate vehicles), we calculate GHG emissions based on gasoline consumption, as outlined in the Provincial Guidance on the Compilation ofGreenhouse Gas Inventories (Trial). These emissions are factored into our overall GHG calculations;For Scope 1 per unit of turnover, we only consider CO2 emissions from our proprietary ships and corporate vehicles;For Scope 2 (electricity purchased for onshore o?ces), we calculate GHG emissions using an emission factor of 0.5703 tCO2/MWh, which is derived fromelectricity grid data published by the Ministry of Ecology and Environment;XT-IMC was incorporated into our consolidated ?nancial statements from March 2023 and the relevant data covers the period from March to December 2023.
Key performance highlights
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In celebration of the 13th "Day of the Seafarer", a series of eventsthemed around "How Seafarers Protect the Marine Environment"were held to spread the message of marine environmentalprotection, energy conservation and emission reduction.
CONSERVE MARINE ECOLOGY
Preserve Biodiversity
The ocean, our blue haven, is vital for human survival and prosperity. At Xingtong Shipping, we are deeply committed to marine ecologicalpreservation. Minimizing our impact on the marine environment has always been a priority of our sustainability initiatives. We pledge to conductour operations in an environmentally friendly manner, implement strict pollution controls, and spare no e?ort to protect the marine ecosystem.Taking seriously the environmental impacts of our products and services throughout their lifecycle, we integrate environmental considerationsright from the planning and design phases. Our priority is to select ships and equipment that are energy-e?cient and safe. During the operation ofthese ships, we e?ectively manage pollutants like wastewater and waste, aiming to either prevent or lessen the amount and harm of thesepollutants right from the start. We enhance our control over how pollutants are produced to reduce their emissions or concentration levels, andapply rigorous end-of-pipe treatment to make sure that pollutants are emitted in line with environmental standards.
The biodiversity in the oceans is a treasure to our global ecosystem. We take a methodical approach to identifying and evaluating the impacts ofour shipping operations and business activities on marine biodiversity, and managing associated risks to prevent any damage or disruption tomarine life.
Ballast watermanagement
NoisemanagementRouteplanning
Complying with the InternationalConvention for the Control andManagement of Ships' Ballast Waterand Sediments, we equip ships withBallast Water Management Systems(BWMS) and standardize ballastwater treatment procedures toprevent unnatural migration ofmarine species. All our proprietaryships engaged in international tradehave implemented ballast watertreatment measures
Noise reduction is a key consider-ation in our ship design and construc-tion e?orts. We employ low-noiseequipment and reduce our speedwhen navigating near PSSAs andKBAs to minimize noise pollution
In our route planning, we utilize theElectronic Chart Display and Informa-tion System (ECDIS) and its automaticroute check feature to identify Particu-larly Sensitive Sea Areas (PSSAs) andKey Biodiversity Areas (KBAs) as no-gozones. This ensures that our shipsavoid these critical regions duringnavigation
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NOx emissionsUnit turnover NOx emissionsSOx emissionsUnit turnover SOx emissionsHazardous waste generatedUnit turnover emissions of hazardous wasteNon-hazardous waste generatedUnit turnover emissions of non-hazardous wasteVolume of waste disposed ofWaste discharged under MARPOL Annex VWaste handled by third partiesTotal water consumption
Use of water on shipsWater use intensity of shipsO?ce water useVolume of treated water dischargedVolume of treated ship domesticwastewater up to discharge standardsVolume of treated oily wastewaterup to discharge standardsVolume of treated chemical tankercleaning water up to discharge standardsVolume of chemical tanker cleaning water disposed
tonnekg/1,000 tonne-miles
tonnekg/1,000 tonne-miles
m
m
/1,000 tonne-miles
m
m
/1,000 tonne-miles
m
m
m
m
m
m
/1,000 tonne-milesm
m
m
m
m
m
732.95
0.69
325.00
0.30
589.37
0.00055
27.12
0.00003
///41,872.1040,258.70
0.04
1,614.00/////
2,435.41
0.63
247.19
0.06
481.74
0.00012
245.80
0.00006
753.17
63.12
697.69
98,305.0896,616.70
0.25
1,685.3841,325.948,489.30
191.78
32,644.862,020.62
Prevent Pollution and Reduce EmissionsWe set our sights higher than the MARPOL standards and China Maritime Safety Administration's maritime regulations. We have establishede?ective management processes and tools for potential pollutants such as oil, bulk hazardous liquid substances, domestic wastewater, waste,gaseous pollutants, and ballast water. Through comprehensive controls, we continuously optimize environmental performance.
Pollution prevention and emission reduction measures
Prevent Oil Spills
E?ectively handle oil spill emergencies, and ensure all operational vessels are certi?ed and have valid oilpollution prevention certi?catesImplement rigorous operating procedures to mitigate risks of spills from ballast water discharge anddeck operations, and conducted regular drills to ensure "No spill" operations
Prevent Toxic and HazardousSubstance Spills
Designate specialized teams to regularly inspect and maintain our pollution preventionequipment and test our pollution monitoring systems, so as to ensure that our equipment andprotocols are always e?ective and reliableBefore conducting any potentially polluting activities such as tank cleaning, ballast waterdischarge, or painting within port areas, always seek prior approvals from the competent author-ities to e?ectively manage environmental risks associated with these operations
Manage Wastewater
and Garbage
Prioritize onshore treatment and keep re?ning the procedures and facilities for the production,collection, storage, and recycling of shipboard wastewater and garbageMake sure our discharge operations fully comply with international conventions and regulations,aiming to progressively reduce the amount of waste produced and discharged from our ships
Cut Emissions ofGaseous Pollutants
Tackle emissions head-on by adopting low-emission, energy-e?cient equipment and clean fuelsfor our ships. Ensure our ?eet is out?tted with Volatile Organic Compounds (VOCs) collectionsystems, and our new ships come with Selective Catalytic Reduction (SCR) units for e?ectivedenitri?cationEnsure rigorous protocols for the operation, maintenance, and inspection of our equipment andsystems are in place to prevent gas leaks during these operations, and reduce emissions ofnitrogen oxides, sulfur dioxide, particulate matter, and VOCs
Conserve WaterResources
Adopt e?cient waste reduction technologies and practices, for example, switching fromdual-nozzle to single-nozzle tank cleaning machines to save the water needed for tank cleaningChampion the recycling of the dirty water from tank cleaning to improve our water e?ciency
KPIUnit20232022Key performance highlights
Notes：
Hazardous waste on our ships includes leftover oil from oil-water separators, slop oil, residual oil, ash from incinerators, oil-soaked and chemically contami-nated rags, e-waste, and spent dry-cell batteries. It is important to note a shift in how these materials were accounted for in 2023;Non-hazardous waste includes the everyday waste produced by our operational ships, such as leftover food, waste paper, used plastics, rags, broken glass,scrap metal, and discarded ceramics;The formulas and coe?cients we use to calculate NOx and SOx emissions are based on the IMO's 2014 Guidelines on the Method of Calculation of the AttainedEEDI for New Ships.XT-IMC was incorporated into our consolidated ?nancial statements from March 2023 and the relevant data covers the period from March to December 2023.
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Xingtong Shipping highly values every employee. We are committed tonurturing talent, enhancing our systems, and creating a robust corporateculture. Our goal is to make Xingtong Shipping a "talent magnet" throughcompetitive employee bene?ts and share our success with all employees.
SHARESUCCESS WITH EMPLOYEES
XINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
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We strictly adhere to national and industry-speci?c laws and regulations. Under our Shore-Based Recruitment Management System, we ?rmlyprohibit forced labor and child labor, reject all forms of employment discrimination based on gender, region, ethnicity, or otherwise, and adopt azero-tolerance stance towards discrimination and harassment. We strive to provide our employees with a diverse and inclusive workplace, alongwith competitive compensation, address their concerns and encourage their participation in company governance.In our approach to compensation management, we uphold the principles of "Internal equity, market competitiveness, and performance-basedincentives". This allows us to establish a well-researched, fair, and competitive compensation system.Through our Shore-Based Employee Compen-sation Management System, we aim to foster a culture of innovation and creativity.We have also developed the Shore-Based Employee Mobility Management System, which de?nes the criteria for promotions, advancements,transfers, demotions, and downgrades. The aim is to create a fair, equitable, and transparent competitive environment.We champion participative management. By improving our approaches to collective bargaining, we strive to meet employees' expectations forequitable and fair pay. Moreover, we regularly organize forums in which our employees are encouraged to voice their opinions and proposals, andclosely follow up on issue resolution and provide timely responses.
PROTECT BASIC RIGHTS
Key performance highlights
the Company consisted of 679 employees, of whom 128 serve shore-based rolesand551 are crew members
By December 31st, 2023
Shore-based Employee Structure
Position
Position
Position
Gender
Age
Age
Age30 and Under31-4546-5556 and Above
30 and Under31-4546-5556 and Above
21.09％
51.56％
19.53％
7.81％
Senior ManagementMiddle ManagementJunior ManagementRegular Employees
Senior ManagementMiddle ManagementJunior ManagementRegular Employees
Senior ManagementMiddle ManagementJunior ManagementRegular Employees
Women in ManagementWomen in Management
9.38％
24.22％
37.21％
28.13％
38.28％
40.00％
8.33％
3.23％
8.33％
12.24％
Shore-based Employee Turnover in 2023
Gender
Female
39.84％
Male
60.16％
2023
Gender
Female
39.13％
Male
60.87％
2022
20.00％
52.17％
20.87％
6.96％
11.30％
23.48％
25.22％
40.00％
Total Turnover
Total Turnover
8.59％
11.11％
7.58％
Male
Female
6.49％
11.76％
12.00％
0.00％
Notes: Employee percentage by category = Number of employees in that category / Total number of employees Women in management include female employees in middle and senior management roles
Notes: Total turnover rate = Total number of employees who have left / Total number of employees Turnover rate by category = Number of employees who have left in that category / Number of employees in that categoryNotice of executive resignation: Mr. Ouyang Guang requested to resign from his position as the Company's Board Secretary for personal reasons
30 and Under31-4546-5556 and Above
SHARE SUCCESS WITH EMPLOYEESXINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
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TALENT ATTRACTION ANDDEVELOPMENTThe development of the talent echelon serves as a perpetual driving force that steadily propels our "1+2+1" strategy forward. A broad-minded andexperienced workforce helps a company navigate the swiftly shifting terrain of the industry with their forward-thinking strategies and plans. To thatend, we have devised a strategy aimed at enhancing our customer service and forming a top talent team, positioning ourselves as a supportiveplatform for our employees' growth and career advancement.One of our approaches is the early recruitment of high-caliber talent endowed with global perspectives and strategic insight. In 2023, weintroduced the High-level Talent Evaluation Scheme. Rooted in transparency, equity, and fairness, the scheme incorporates a holistic evaluationsystem that assesses character, knowledge, abilities, and performance. Furthermore, we o?er incentives such as rewards and ?nancial support totop-tier talents, which promotes the construction of a high-level team including management, professional and technical talents.To o?er comprehensive and systematic employee training, we have rolled out the 2023 New Employee Training Schedule and the Annual TrainingPlan for Shore-based Personnel, aimed at providing specialized training tailored to their roles and career aspirations. Additionally, we o?er special-ized training resources in safety, management, risk, workplace etiquette, and career development for employees across di?erent positions andspecialties.
PositionGender
Senior ManagementMiddle ManagementJunior ManagementRegular Employees
Senior ManagementMiddle ManagementJunior ManagementRegular Employees
Shore-based Employee Training in 2023
Female
41.18％
Male
58.82％
10.08％
25.21％
28.57％
36.13％
Number of Trainees
Average Training Hours per Employee
24.76h
92.97％
Key performance highlights
Number of new shore-based employees:
23 Training expense per employee: approximately RMB 2,300By December 31st, 2023
Notes: Percentage of employees trained by category = Number of employees trained in that category / Total number of employees trained Average training hours per person by category = Total training hours for employees in that category / Number of employees in that category
Male
21.55h
Female29.62h
22.38h
29.75h
28.03h
19.61h
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BUILD A HIGH-CALIBER CREW
The expertise and pro?ciency of our crew members are vital to the safetyand quality of our liquid hazardous goods shipping services. A compe-tent and reliable crew also underpins the improvement of our safetymanagement and services. Upholding people centricity, innovation,value creation, and the pursuit of excellence, we are determined to builda crew distinguished not only by their expertise but also by a profoundsense of belonging and identi?cation with our Company.In preparation for the expansion of our international operations, wedevelop a strong talent pool of highly quali?ed seafarers and managers.By o?ering competitive employee bene?ts, diverse recruitmentchannels, and clear career progression pathways, we draw in exception-al talent. Our recruitment is strategically aligned with our crew develop-ment plan, and based on the comprehensive assessment of eachcandidate. For international routes, we review the quali?cations of crewmembers sourced from third-party agencies, and carry out in-depthinterviews for pivotal positions such as Captain, Chief O?cer, ChiefEngineer, and Second Engineer to ensure every crew member meets ourinternational business requirements.
Xingtong Shipping's international crew
Crew Training in 2023
Training OverviewPosition
Key performance highlightsBy December 31st, 2023we added 178 new membersto our crew roster.
Crew Structure
2023
2022
Type of EmploymentPosition (Own Crew)Age (Own Crew)
Type of EmploymentPosition (Own Crew)Age (Own Crew)
25 and Under26-3536-4546-55
2.72％
22.14％
41.74％
28.31％
56 and Above
25 and Under26-3536-4546-5556 and Above
5.08％
Regular Crew
57.17％
Captain
4.72％
Third-partyCrew
71.01％
Own Crew
28.99％
1.40％
22.55％
38.92％
31.54％
5.59％
Regular Crew
58.28％
Senior Crew
38.11％
Senior Crew
36.53％
Captain
5.19％
Own Crew
100％
100％
Key performance highlights
Training expense per crew member: approximately RMB
Average training hours per crew member: 89.91 hours
AgePositionTotal Turnover
25 and Under26-3536-4546-55
6.67％
22.95％
20.87％
24.36％
56 and Above
21.43％
21.96％
We value the operational and skill training for our crew members, and continually re?ne our crew training programs. We have issued the SQMSPersonnel Training Procedures, outlining training plans for crew members across various positions. In recognition of the unique demands of ourindustry, we have established a comprehensive training matrix that covers safety awareness, operational skills, and ?rst aid. By December 31st,2023, all our crew members had received training.
Average Training Hours per
TraineeCaptain
4.72％
| Senior Crew18336.53％ | Senior Crew21038.11％ |
Rgular Crew
57.17％
Note: Crew percentage by category = Number of crew members in that category / Total number of crew members
Notes: Total crew turnover rate = Total number of crew members who have left / Total number of crew members Crew turnover rate by category = Number of crew members who have left in that category / Number of crew members in that category
Own Crew Turnover in 2023
In 2023
CaptainSenior CrewRgular Crew
104.00h
103.03h
80.00h
18.73％
11.54％
CaptainSenior Crew
Regular Crew
SHARE SUCCESS WITH EMPLOYEESXINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
Notes: Percentage of crew trained by category = Number of crew members trained in that category / Total number of crew members trained
Average training hours per person by category = Total training hours for crew members in that category / Number of crew members in thatcategory5960
Given the unique challenges of their work environment, job demands, and working hours, our crew members are more vulnerable to physical andmental health issues. Therefore, we are committed to upgrading their living and working conditions at sea and striking a good balance betweenwork, rest, and recreation for the health and well-being of every crew member.
Our commitment runs deep in fostering a warm, cohesive, and family-like atmosphere at Xingtong Shipping. Beyond providing comprehensivesupport to our employees, we extend the perks and bene?ts to their families.As pivotal roles onboard, Third O?cers are responsible for life-saving and ?re?ghting tasks, while Fourth Engineers manage engine roomequipment. To cultivate a highly skilled crew and promote structured talent development, Xingtong Shipping launched the "ThirdO?cer and Fourth Engineer" training program in 2021. This program motivates quali?ed crew members to partake in maritime academytraining that covers both foundational knowledge and role-speci?c skills, with the promise of tuition reimbursement upon successfulcompletion of their exams. By December 31st, 2023, the program has successfully trained 16 Third O?cers and 15 Fourth Engineers,signi?cantly expanding our talent pool and supporting the sustained development of our crew.
"Third O?cer and Fourth Engineer" Training Program
Case
Case
Xiao Zhurong's journey with Xingtong Shipping beganin August 2010, progressing from a sailor to ThirdO?cer, Second O?cer, Chief O?cer, and ?nally toCaptain. He was awarded the "Outstanding Captain ofthe Year" in 2021 and assumed the position ofShore-based Maritime Supervisor on June 1st, 2023.We provide all the training resources needed for ouremployees' career progression. At the early stage, hewas provided with training on essential navigationalskills such as ship operation, weather navigation,maritime safety, and ship upkeep. As he ascendedthrough the ranks, the training emphasis shiftedtowards ship management and leadership skills. Thisincluded safety protocols, cargo handling, crewmanagement, and client relationships. These targetedtraining sharpened his leadership and decision-mak-ing skills. The unwavering quest for excellence is in ourDNA, passed down through generations. Xiao's growthis one of the many personal success stories at XingtongShipping.
Career Progression at Xingtong Shipping:
The Path to Captain
In 2023all female employees who had taken maternity leave returned to work
Key performance highlights
To enhance crew retention, the Company has introduced the Crew Salary Management System, aiming to establish a fair pay structure comple-mented by a robust performance assessment system. Meanwhile, we have updated our Crew Management System to re?ne the rules andprocedures for promotions, providing crew members with a transparent career advancement pathway and broader development opportunities.
Regular occupational health check-ups; group accident insurance; access to various sports facilities andcompetition eventsFinancial aid to employees undergoing ?nancial di?culties; the "Xingtong Scholarship" program for ouremployees' children who attend collegeFlexible work schedules for working mothers; protection of women's legitimate rights during pregnancyand maternity; organization of International Women's Day celebrations
Partner with hospitals in Huizhou andZhoushan to expand channels forphysical exams
Provide seafarer bene?ts
Set up ?tness rooms and other sports facilities
Host retirement ceremony for retiring crewmembers
Pay holiday visits to crew membersand their families
Hold special events to celebrate "Day of theSeafarer" and "China National Maritime Day",and organize family gatherings
FOSTER A SUPPORTIVE WORKENVIRONMENT
FamilySupportSupport forFemale Employees
Greatersupportfor crewmembers
PhysicalHealth
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It is di?cult for seafarers to properly care for their families due to long hours away from home. Acknowledging this, Xingtong Shippinghas introduced a special family-friendly policy for crew members to foster their family bond.By conducting monthly visits to 3-4 crew families, we learn about their lives, understand their speci?c needs, and o?er them targetedsupport. The core values of our corporate culture are also conveyed and exempli?ed through these connections. More importantly,these visits extend beyond mere care which provide support and motivation for our crew members, so that they can stay focused andachieve a peace of mind at work. In the year 2023, we extended our support to 40 crew families.
Extending Care to Crew FamiliesCase
General Manager's Visit to Crew Members
Retirement Ceremony for Retiring Crew Members
Crew Members' Children in Educational Activities on China NationalMaritime Day
Family Gathering Event at The Quanzhou Museum in 2023
Badminton Tournament
Organize Our Employees to Visit to The Quanzhou
Maritime Museum
SHARE SUCCESS WITH EMPLOYEESXINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
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We are well aware that communities are the fertile ground on whichbusinesses grow. Leveraging our strengths in technology and talent, wehave launched a variety of programs to bolster local education, nurturefuture talents in port and shipping sectors, and support communitybuilding. We motivate our employees to partake in community volunteerservices, give back to society and nourish our roots through concreteactions.
CONTRIBUTE
TO COMMUNITY DEVELOPMENTCONTINUOUSLY
XINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORTXINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
6566
The summer typhoon season unfolded in July 2023. In order to help orchard farmers win the race against time to complete fruit picking andput the fresh fruits onto the market, our employees participated in the "Rural Revitalization Through Collaboration" initiative to support theQuangang Jinchuan Rural Cooperative and to minimize farmers’ losses from potential disasters."Rural Revitalization Through Collaboration" Fruit Harvesting ActivityCase
Cultivate Maritime Professionals
Support CommunityDevelopmentSupport Local Education
Key performance highlightsNumber of volunteers engaged:
Number of volunteering activities: 5Total donations: RMB 2.0228 million"Over RMB100 million taxpayer in 2023", recognized by the CPC Committeeof Quangang District and the People's Government of Quangang District
In 2023
We made contributions to the QuangangDistrict Education Development Founda-tion, set up scholarships and awards atHaicheng Experimental Primary School,Quangang District No.1 Middle School,and Quangang District Sanchuan MiddleSchool. Our e?orts aim at helping theneedy, motivated and ambitious studentsrealize their dreams and improving thequality of local education
We engaged in exchanges and collabora-tions with Shanghai Maritime Universityon crew training and the digitalization oflogistics. Additionally, we participated inthe ?rst seminar on maritime education,training and employment at QuanzhouOcean Institute, where we signed agree-ments to nurture port and maritime pro-
fessionals
We planted trees, cleared typhoonaftermath, and assisted in agriculturalharvests, contributing to communitydevelopment and shouldering ourcorporate responsibility with concrete
actions
CONTRIBUTE TO COMMUNITY DEVELOPMENT CONTINUOUSLYXINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
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OUTLOOK
The updates to the IMO's emission reduction strategy and the release of the ISSB standards pose higher demands on the safety, green manage-ment, and sustainability disclosure for hazardous chemicals shipping companies. This brings both challenges and opportunities. In response, wewill keep forging ahead with our "1+2+1" strategy, prioritizing safety and our customers above all else. We will ?rmly implement rigorous andscienti?c management practices, leverage digital technology, and boost compliance. Remaining true to value creation and shared success, westrive for even greater accomplishments through dedication and hard work.Streamline chemical logistics and embark on a new voyage
The secure and stable supply of chemical raw materials is crucial for the sustained and robust development of the economy and society. Weremain committed to facilitating the smooth shipping of chemicals. We will accelerate e?orts to optimize our ?eet's capacity, expand our shippingnetwork, implement technological and equipment upgrades, and strengthen operational management. Furthermore, we will steadfastly upholdour commitment to service excellence and a customer-centric approach, always putting our customers' needs ?rst. By re?ning our managementpractices, we can continuously improve our customer service capabilities and fuel the e?cient operation of the chemical supply chain.Prioritize safety and create green valueSafety management is the bedrock of the maritime industry, while green transformation is our collective imperative. We will thoroughly implementthe strategic directives of the CPC Central Committee, seamlessly weaving sustainability into our overarching strategy. This commitment extendsbeyond our e?orts to improve energy e?ciency and environmental stewardship; we will also proactively seek out the latest clean technologyadvancements within the maritime sector. Concurrently, we will embed safety management into every aspect of our shipping services. Withproven risk identi?cation, prevention, and control measures in place, we can adeptly address potential environmental and safety risks, and ensureup-to-standard, e?ective, and comprehensive ship management.
Develop talent and give back to communityAt Xingtong Shipping, we regard employees as the most valuable asset for our growth, and are deeply committed to building community relation-ships. We will fast-track our talent development initiatives to provide our employees with more opportunities to ful?ll their potential. Meanwhile,we will play an active role in community governance, working more closely with the community to build a better future together.Great achievements come from grand ambitions and unwavering diligence. In the future, we will keep pace with the green and low-carbon trendsin the shipping industry, moving decisively towards our goal of being a top-tier chemical supply chain service provider both internationally anddomestically. This is how we contribute to a shared destiny between humanity and marine life.
XINGTONG SHIPPING CO., LTD.2023ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) REPORT
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Feedback Form
Dear Stakeholders,Thank you for taking the time to read the 2023 Environmental, Social, and Governance (ESG) Report of Xingtong Shipping Co., Ltd. As we release our secondESG report, we are keen to hear your thoughts on our corporate social responsibility e?orts and explore ways to foster sustainability. Your feedback andsuggestions are not just welcome but also invaluable to us.
1. Please identify your relationship with Xingtong Shipping:
□Government or regulatory agency □Investor □Customer □Employee
□Supplier □Industry peer □Social organization □Community member
□Media □Other (please specify) _________
2. How would you rate the representation of your interests and concerns in
this report?
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3. To what extent do you believe this report accurately re?ects Xingtong
Shipping's social responsibility practices?
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4. How easy is it for you to ?nd the information you are looking for in this
report?
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5. How would you rate Xingtong Shipping's performance in ensuring transport
capacity?
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6. How would you rate Xingtong Shipping's customer service?
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7. How would you rate Xingtong Shipping's safety management?
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8. How would you rate Xingtong Shipping's performance in green development?
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9. How would you rate Xingtong Shipping's responsibilities towards employees?
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10. How would you rate Xingtong Shipping's responsibilities towards the
community?
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11.Do you have any feedback or suggestions about
Xingtong Shipping's ESG Report?
12. Do you have any feedback or suggestions about
Xingtong Shipping's social responsibility practices?
CONTACT USXingtong Shipping Co., Ltd.Address: Floors 8-9, Xingtong Shipping Building, No.295 Yifeng East Road, Quangang District, QuanzhouCity, Fujian Province, ChinaPostcode: 362800Tel.: 86-0595-87777879Fax: 86-0595-87088898Email: securities@xtshipping.cn