| CONTENTSCreating Smart LogisticsInnovation-Driven DevelopmentSecuring Safety DeliveryDelivering Premium ServicesServicesP97-P112Foreword to the Report | ||||
| P002-P01401 | ||||
| Chairman’s MessageAbout SFSustainability Management | ||||
Climate-relatedDisclosures
P113-P122Appendix
AppendixP123-P148
P123-P148
About the ReportAssurance statementPolicy ListKey PerformanceIndicator IndexReaders’ Feedback
Empowering the Talent TeamBuilding the Line of SafetyBuilding Responsible Chain TogetherShouldering Social ResponsibilitySociety
P055-P096
Standardizing Corporate GovernanceStrengthening Risk Control ManagementAbiding by Business EthicsEnsuring Information Security
About the ReportAssurance statementPolicy ListKey PerformanceIndicator IndexReaders’ Feedback
Empowering the Talent TeamBuilding the Line of SafetyBuilding Responsible Chain TogetherShouldering Social ResponsibilitySociety
P055-P096
Governance
P015-P031
Governance
P015-P031
Environment
P032-P054
Creating Green LogisticsPromoting Circular EconomyProtecting the EnvironmentGreen Of?ce
PrefaceGovernanceStrategyRisk ManagementMetrics and Targets
Foreword to the Report
Chairman’s MessageAbout SFSustainability Management
2023 S.F. HOLDING SUSTAINABILITY REPORT
Foreword to the Report
In 2023, the recovery of social production and consumption activities has driven the express delivery and logistics industry to achieve good growth,with China’s annual express delivery volume exceeding 132 billion parcels for the first time. Against the backdrop of the global supply chain reshapingand the upgrading and globalization of China’s manufacturing industry, SF, as the largest integrated logistics enterprise in Asia and the fourth largestin the world, has always adhered to its original aspiration and practical actions, upheld the concept of sustainable and healthy development, andempowered global customers to achieve high-quality development by providing efficient, green, and low-carbon integrated logistics services. At thesame time, we realized social value and demonstrated corporate responsibility and commitment.Adapting to Change, Embracing Sustainable VisionIn the face of a dynamic external environment, SF has quickly grasped opportunities, continuously innovated and transformed, consolidated itsservice capabilities, and built a more comprehensive product system, a more complete coverage chain, and a more diversified service scenario in thecomprehensive logistics service landscape, covering end-to-end supply chains for customers from procurement and production to sales and services,and from domestic to international. In 2023, SF has completed and put into operation Asia’s largest cargo aviation hub in Ezhou, gradually building a“hub-and-spoke” network connecting China with the world, further improving the competitiveness of service efficiency. In the Fortune 500 in 2023,SF has risen to 377th place, making the list for the second consecutive year, and is the only Chinese private express delivery company to enter theFortune 500.Integrating Knowledge with Action, Implementing Low-carbon OperationsSF is committed to achieving the integration and unity of commercial and social values, firmly fulfilling its commitment to environmental protectionwhile pursuing high-quality development, and steadily advancing the achievement of the Company’s carbon targets. In 2023, SF made considerableprogress by promoting low-carbon transportation, building green industrial parks, developing sustainable packaging, and other initiatives, achieving a15% improvement in its carbon efficiency compared to the target base year. At the same time, the Company committed to the “Science Based Targetsinitiative” (SBTi) and to achieving net-zero greenhouse gas emissions across its value chain by 2050. Based on its standardized carbon managementcapabilities, SF independently developed the industry’s first shipment-level carbon calculation model in 2023, providing customized green and low-carbon supply chain solutions and services to multiple global leading customers, deeply enabling upstream and downstream partners in the industrychain, and jointly promoting the industry’s supply chain towards a zero-carbon future.Embracing Our Commitment to Serving Society and HonoringOur Corporate RootsWhile continuously providing high-quality express logistics services, SF has always adhered to fulfilling its social responsibilities and contributing tosociety and serving the people’s livelihood through tangible actions. In 2023, SF helped expand the production and sales network of agriculturalproducts to cover more than 2,700 county-level cities across the country, transporting 4.58 million tons of specialty agricultural products. It alsoestablished over 100,000 cooperative points in rural villages, gradually forming a comprehensive rural express delivery network and continuouslyinjecting new logistics momentum into rural revitalization. In the face of various sudden natural disasters, the Company promptly mobilized emergencyresources such as aircraft and vehicles to actively assist in disaster relief operations such as the Baoshan earthquake in Yunnan, the flood situation inBeijing, Tianjin, and Hebei, and the Jishi mountain earthquake in Gansu. Relying on its own resource advantages and efficient organizational allocationcapabilities, SF has continuously contributed its due efforts to stand together with the people in disaster-stricken areas and overcome difficulties.Undeterred by challenges, unfazed by adversities, our journey is marked by resilience and fruition. Gazing toward the future, SF will continue toadhere to the principles of long-termism and sustainable and healthy development, steadily promote the construction of a green and low-carbonsupply chain ecosystem, continuously enhance employee welfare and care, fulfill social responsibilities, and strive to become a benchmark enterprisethat continuously creates excellent social value, delivering enduring momentum for global sustainable development.
Chairman’s Message
2023 S.F. HOLDING SUSTAINABILITY REPORT
Foreword to the Report
About SF“S.F. Holding is the largest integrated logistics service provider in China and Asia
and the fourth largest in the world.
”With the logistics ecosystem as a focal point, the Company has continually developed its portfolio of product and service capabilities, and hasexpanded to cover time-definite express, economy express, freight, cold chain and pharmaceuticals logistics, intra-city on-demand delivery,international express, international freight and freight forwarding, and supply chain, to provide customers with domestic and international end-to-endone-stop supply chain services. Meanwhile, through leveraging leading technology and research and development capabilities, the Company strives tocreate a digital supply chain ecosystem, and become a front runner in global intelligent supply chain.With the aim of sustainable and healthy development through visionary and forward-looking strategic planning, for the past 31 years, the Companyhas accurately seized opportunities to expand its scale, maintain industry leadership, and has become the leading logistics company in China and Asiaranking the 377th in the Fortune Global 500 list.The Company’s flagship product, time-definite express, has dominant market leadership in China, and through leveraging the network resources andcapabilities for its time-definite express, the Company has rapidly and efficiently expanded into new logistics service sub-segments, covering fromsmall parcels to bulk and heavy cargoes, from standardized express delivery to customized supply chain services, and from China to Asia and further tothe world. The Company is the market leader in China
across five logistics sub-segments including express, freight, cold chain, intra-city on-demanddelivery
and supply chain
, and the market leader in Asia
across four logistics sub-segments including express, freight, intra-city on-demand delivery
and international business
in Asia.Looking ahead, the Company is committed to becoming the leading global logistics company connecting Asia and the world. The Company willsolidify its market leadership in China and continue to expand its presence in Asia and globally; rapidly replicate its proven domestic know-how tooverseas networks, and expand globally by leveraging its well-recognized brand, leading cost advantages and integrated logistics service capabilitiesto drive the sustainable and healthy growth of the Company, so as to become the go-to logistics partner of global business customers and retailcustomers to foster shared-growth and co-create enduring value.
According to the Frost & Sullivan report, in terms of revenue in 2022
Among third-party intra-city on-demand delivery service providers
Among non-state-owned independent third-party supply chain solution providers
Among the integrated logistics service providers in Asia
Largest in AsiaIntegrated LogisticsService Provider
Extensive ScaleUndisputed LeadershipPremium BrandNo. 1 in AsiaExpress, LTL Freight, Intra-cityOn-demand, InternationalNo. 1 in China
Express, LTL Freight,Cold chain logistics,Intra-city On-demand, Supply chain
No. 1Customer Satisfaction forExpress Services in China4th Largest Globally
14 years in a row
2023 S.F. HOLDING SUSTAINABILITY REPORT
Foreword to the Report
Core ValuesCore values are the value standards and basic faith that SFers must believe in, guiding SFers the approaches to realize the corporate vision.
Integrity and responsibilityDedication to employees’ successDedication to customers’ successInnovation and inclusivenessPursuit of excellenceIn SF, all people shall adhere to the principle of integrity and responsibility,take dedication to employees’ success and dedication to customers’success as their own tasks, always be innovative and inclusive, pursueexcellence and create a better future together.
To build a truly digitalized eco-system with our partnersTo drive for global excellency with our customersTo strive for common prosperity and a better future for allFor the society, SF is a benchmark that continues to create excellent social value.For our customers, SF is the preferred partner of all customers.For the Company, SF is a leading player in global smart supply chains.For our employees, SF is a promising platform for global talents to pursue excellence,achieve dreams and take pride in one’s career.
SF cultureFor thirty-one years, we have been striving for progress, and every season has been fruitful. Time and again, the thorns and breakthroughs engravedin the rapid development of SF, so that the company has built a corporate culture imprinted with the brand of SF. For SF, corporate culture is notonly a belief, but also a commitment and practice. It is reflected in the words and deeds of all SF employees, and in all SF’s business conduct, and hasbecome a strong spiritual force that is deeply cast in the cohesion, competitiveness and vitality of SF.Corporate VisionCorporate vision is the goal and blueprint of SF, navigating the development direction of SFers.
2023 S.F. HOLDING SUSTAINABILITY REPORT
Foreword to the Report
Team CultureSF’s team culture, derived from SF’s vision, core values and corporate culture with organizational characteristics, guides SF to victory.
Win the game; teamworkIdentify the weaknessesand make improvementPromote the capable ones;coach; sunshineThe Company is like a team, all the members gather to winfor common goal. They learn and grow here, coordinate andcooperate with each other, train and fight together. The honorof the team means personal achievement of each member.
Corporate SpiritCorporate spirit is the team quality and spiritual outlook that SFers demonstrate in practice, and is the portrait of SFers and the popular image of SF.
Equality and respectIntegrity PragmatismTreat others and handle affairs in principle ofequality, respect, integrity and pragmatism. TheseCorporate Spirits are the practices of SF values andalso the public’s most intuitive perception of SF.
2023 S.F. HOLDING SUSTAINABILITY REPORT
Foreword to the Report
2023 Honours and awards related to SF Sustainable DevelopmentAwards for Sustainable Development
Named to “Fortune China ESGInfluential Listing” (in 2 yearsconsecutively)
CCTV-2’s “Chinese ESG ListedCompanies Vanguard 100”
Caijing’s Caijing Award“Sustainable DevelopmentInclusive Award” in 2023
The Time Weekly’s “ListedCompanies ESG ExemplaryEnterprise Award” in 2023
ChinaTimes’s “ESG Practice
Excellent Cases” in 2023
Corporate Donor Award in the
12th China Charity Awards
China Association for PublicCompanies “Best Practices in ESG for
Listed Companies,” “Best Practicesin Corporate Governance for ListedCompanies,” and “Best Practicesfor the Board of Directors of ListedCompanies” in 2023
China Green Point’s “Green PointAward for Sustainable Practices”
in 2023
Stockstar’s “ESG New Benchmark
Enterprise Award” and “ESGInvestment Value List” in 2023
Wind’s “Top 100 Best ESG
Practices” for Chinese Listed
Companies in 2023
Charity Project Award in the 12thChina Charity Awards (SF Warmthand Care Program)
China Corporate GovernanceExperts 50 Forum “China Listed
Companies ESG TOP50 (Non-
Financial) in 2023”
2023 S.F. HOLDING SUSTAINABILITY REPORT
Foreword to the Report
Annual progress on UN Sustainable Development Goals (SDGs)GovernanceEnvironment
? There are 2 female directors among the members of the Board ofDirectors, accounting for 28.6% of the total female representationon the Board.? In 2023, SF carried out targeted updates to risk scenarios and
formulated 26 risk response and control plans.? In 2023, SF conducted specialized risk training courses for a total
of over 86,400 hours, achieving a 100% coverage rate for new
employees’ specialized training about risk.? Over the past three years, SF has achieved a 100% coverage rate
for conducting internal audits of business ethics at all operational
sites.? In 2023, SF organized 20 offline anti-corruption training sessions,
achieving a 100% coverage rate among employees. The total
duration of anti-corruption education for employees was 70,073
hours, and the signing rate for the “Anti-Corruption Commitment
Letter” among employees reached 99.0%.? In 2023, SF Technology obtained ISO 27001, the authentication
of information security management system and ISO 27701, the
authentication of privacy information management system.? As of the end of 2023, SF had led or participated in the
development of 5 national standards and industry standards related
to data security, of which 3 national standards had been formally
issued.
? In 2023, SF achieved a carbon efficiency
of 41.1 tCO
e/millionrevenue, representing a 15.3% improvement compared to thecarbon target baseline year (2021). And the carbon footprintper shipment was 730.9 gCO
e/parcel, a decrease of 15.1%compared to the carbon target baseline year (2021).? In 2023, SF independently developed the industry’s first
shipment-level carbon calculation model, whichaccurately calculates the carbon emissions generated by eachshipment in various transportation stages using different modes oftransportation based on the actual business data.? As of the end of 2023, SF had deployed over 31,000 new energy
vehicles, covering 243 cities.? As of the end of 2023, 14 photovoltaic projects in
industrial parks had been successfully put into operation,
with a total installed capacity of 64 MW. The photovoltaic power
generation in 2023 reached 18.39 million kWh, reducing GHG
emissions by 10,229 tCO
e.? In 2023, SF reduced paper usage by approximately 43,000 tons,
plastic usage by approximately 162,000 tons, and GHG emissionsby approximately 164,000 tCO
e through packaging reduction
measures.? In 2023, SF reduced GHG emissions by approximately 540,000tCO
e through green packaging initiatives.? In 2023, SF completed the R&D of a recycled formula and products
for “Double Easy” (easy to recycle, easy to regenerate) plasticbags in Shanghai, adding up to 30% recycled resin (PCR) whilemaintaining excellent performance. It met the national standardrequirements for express bags and was awarded an excellent ratingcertificate for “Plastic Product Easy to Recycle and Easy to
Regenerate Design Certification”.
? In 2023, SF launched the industry’s first pilot project for
the closed-loop recycling and regeneration of plasticpackaging waste in Shanghai, with over 880,000 “Double
Easy” packaging bags distributed. The total amount of recyclingexceeded 1.1 tons.? As of the end of 2023, SF had jointly planted over 823.5 acresof carbon-neutral forests with enterprises, employees, andcustomers, planting over 600,000 trees in total. It is estimatedthat these trees will absorb over 110,000 tons of carbon dioxideduring their growth in the future.
This is the carbon efficiency data of SF only, excluding Kerry logistics network
limited.
2023 S.F. HOLDING SUSTAINABILITY REPORT
Foreword to the Report
SocietyServices
? By the end of 2023, SF has extended its service network foragricultural product production and marketing to cover over
2,700 county-level cities nationwide, encompassing more than6,000 characteristic agricultural products. In 2023, we transported
approximately 4.58 million tons of characteristic agriculturalproducts.? In 2023, SF supported an exterior training program for employeeswith an investment of over RMB4.6 million. A total of 21,445employees obtained academic certificates through the “SF SupportsYour University Education” program.? In 2023, SF assisted more than 20,000 employees and theirfamilies in need, with a total relief amount of approximately
RMB11.61 million.
? In 2023, SF did not experience any major fire accidents or
major casualties. The accident rate for every one million parcelsdecreased by 15.1% compared to 2022.? In 2023, SF conducted assessments of the safety production system
for the entire network. 55% of regions and 100% of distributionareas’ safety production system underwent assessments by theheadquarters.? In 2023, SF achieved a 100% signing rate for safety management
agreements with contractors and conducted on-site safetyinspections for 321 contractors.? In 2023, SF conducted a total of 96,000 safety training sessions
of different types, covering 100% of employees with safetyeducation. The number of employees holding safety qualificationsreached 940.? In 2023, SF conducted a total of 13,000 firefighting safety
emergency drills, with a cumulative participation of 440,000people.? In 2023, the signing rate for integrity agreements with suppliersreached 100%.? In 2023, SF spent a total of RMB106 million on public welfare,
organizing a total of 155 public welfare activities with 8,861participants, and a total volunteer service duration of 34,948
hours.
? In 2023, the SF Lotus Education Assistance Program sponsored
13,718 students, with a total scholarship of RMB31.19 million.By the end of 2023, the SF Warmth and Care Program had assisted
21,379 needy children suffering from serious illnesses or orphans,providing humanistic care services to 35,803 children and theirfamilies.
? SF has created a highly realistic and efficient logistics digitaltwin with high algorithm verification efficiency, finding optimaldecision-making solutions for numerous scenarios and improvingthe logistics operational efficiency in various aspects of the realworld.? The SF Ezhou Hub has an automated sorting equipment line witha total length of 52 kilometers, is capable of sorting a peak of280,000 parcels per hour.? In 2023, SF received 32,578 complaints, a decrease of 12.1%compared to 2022. The handling rate reached 100%.? SF conducts quarterly customer satisfaction and Net Promoter Score
(NPS) surveys. In 2023, the total sample size exceeded 100,000,covering hundreds of cities nationwide, and involving more
than 40 sub-indicators across six dimensions.? In the 2023 public satisfaction survey on express delivery servicesreleased by the State Post Bureau, SF ranked first in all threequarters of 2023. According to the China Net Promoter Score(C-NPS) released by Chnbrand in 2023, SF ranked first in the
recommendation of express delivery.? In 2023, SF launched the “SF ID” service, which supports
users in setting customized codes to replace traditional address
information, ensuring end-to-end information encryption,
and providing users with a more convenient and privacy-safe way
of sending parcels.
2023 S.F. HOLDING SUSTAINABILITY REPORT
Foreword to the Report
External ESG Ratings Highlights
Note: the above rating results were collected on March 26, 2024.
SF has been rated BBB by MSCI fortwo consecutive years (2022-2023)
For two consecutive years (2022-2023),SF has obtained a CDP climate change questionnaire rating ofB
SF has rated as “Low Risk” by Sustainalytics fortwo consecutive years (2022-2023)
SF has been included in theFTSE Russell ESG Index seriesfor three consecutive years (2021-2023)
Foreword to the Report
2023 S.F. HOLDING SUSTAINABILITY REPORT
Sustainability ManagementSF is committed to integrating corporate value with social value, nurturing a vision to drive sustainable industry development, andactively exploring the path of corporate sustainability. SF continuously improves its sustainable development management system,actively integrating ESG principles into every aspect of its value chain, enhancing its sustainable development capabilities andbusiness resilience, and achieving long-term value creation.Declaration from the Board of DirectorsThe Board of Directors and all directors solemnly declare that the contents of this report are true, accurate, and complete, without any false records,misleading statements, or significant omissions. The Board also makes the following statements regarding its ESG supervision and management work:
ESG Management Policies and StrategiesThe Board of Directors closely monitors the main trends of global ESG and changes in the domestic and international macroeconomic situations.Combining with the Company’s current development strategy, the Board actively communicates with stakeholders to accurately identify ESG-relatedrisks and opportunities. The Board also updates its ESG management policies and strategies when necessary to ensure that SF’s ESG principles keeppace with the times.ESG Risk ManagementThe Board of Directors attaches great importance to the management of ESG-related risks and actively participates in stakeholder communication.It assesses, analyzes, and prioritizes the materiality of ESG issues, identifies related risks and opportunities, and updates management policies andstrategies as necessary. SF has incorporated ESG-related risks, including climate change, into its risk assessment system, regularly conducts riskidentification and assessment, and formulates corresponding risk response measures. For more information on risk management and internal controls,please refer to the “Governance – Strengthening Risk Control Management” section of this report. As for information on climate change-related riskmanagement, please refer to the “Disclosure of Climate-Related Information” section of this report.ESG Goal Setting and Progress ReviewThe Board is responsible for overseeing and managing the Company’s sustainable development matters, making decisions on strategic goals, strategicdirections, and key work areas in the core domains of sustainable development, and supervising and guiding the implementation of ESG work toensure that ESG governance is integrated into the Company’s strategic development. The members of the Sustainability Leadership Group under theBoard’s Strategic Committee have their compensation linked to ESG performance. SF has achieved all its ESG goals in 2023, and significant progresshas been made in advancing long-term ESG goals. The Board will continue to optimize the Company’s ESG governance, regularly review its progressof approaching the goals, actively respond to stakeholder concerns, and continuously improve its ESG governance levels.
Foreword to the Report
2023 S.F. HOLDING SUSTAINABILITY REPORT
ESG Governance SystemSF integrates ESG principles into its corporate development strategy, establishing a scientific and professional ESG management system and a clear andtransparent ESG governance structure. Meanwhile, it comprehensively implements the ESG-related strategies to support the sustainable developmentof the Company’s business.
Foreword to the Report
2023 S.F. HOLDING SUSTAINABILITY REPORT
Communication with StakeholdersSF attaches great importance to communication with stakeholders and has established diverse and efficient communication channels tailored to thecharacteristics of different stakeholders. Through regular and diversified communication with nine categories of stakeholders including regulatoryagencies, investors, employees, customers, value chain partners and so on, SF optimize the rights to know for all stakeholders. At the same time,the Company actively considers stakeholders’ concerns, integrating their expectations and demands into strategic and operational management, andregularly reviews the materiality of various issues in the Company’s operations and development.Main Stakeholder GroupsMain Concerns
Main Channels forCommunication
Response Measures
Regulatory agencies
? Compliant operation? Paying taxes in
accordance with laws? Building Integrity
? Information disclosure? Policy implementation? Inspection of institutions
Operating in compliance with lawsPreventing major safety accidentsIncreasing local employment ratePromoting actively industrialpoverty alleviation
Employees
? Employees rights and
benefits? Employee development
and training? Employee care? Occupational health and
safety
? Employeecommunication channels? Employee satisfactionsurvey? Employee meeting? Employee activities
Protecting employees’ rightsaccording to the lawProviding trainingImproving the talent promotionand salary system mechanismStrengthening occupational healthand safety managementPromoting diverse employeebenefits
Customers
? Safety Delivery? Consumers Protection? Customers privacy? Responsible marketing
? Customer research? Customer hotline? Customer satisfactionsurvey
Providing efficient, reliable, andfast logistics servicesEnhancing the customer claim
settlement processBuilding a safe ecosystem
Shareholders and
investors
? Investment returns? Corporate governance? ESG management
? General meeting of
shareholders? Announcements and
circulars? Investor roadshow
Establishing and improving thescientific decision-making andsupervision mechanismStrengthening risk managementDisclosing information properlyOrganizing and participating in
activities targeting differenttypes of shareholdersDirectors, supervisors andsenior management
? Corporate governance? Compliance risk? Sustainable Operations
? Regular board meetings
Periodic reportOperating in compliance with lawsand regulationsStrengthening risk management
Suppliers
? Sustainable
procurement? Honesty and integrity? Industry cooperation
? Supplier conference? Supplier training? Industry communication
Promoting transparentprocurementEliminating commercial bribery
Community
? Public charity? Community
development? Rural revitalization
? Provision of employment? Industrial assistance? Volunteer service? Public welfare activities
Interactions through websites and
other official platformsPaying regular visits
Industry association
? Strengtheningcommunication andcooperation? Industrial standard
development
? Convening summitactivities? Organizing technologicalcommunication
Participating in industry activitiesParticipating in the development
of industrial standard
Media/the public
? Informationtransparency? Interaction with themedia
? Information disclosure? Building acommunicationmechanism
Active communication through
websites and other official
platformsProviding external publicity
materials
Foreword to the Report
2023 S.F. HOLDING SUSTAINABILITY REPORT
Assessment of Materiality IssuesTo review the commitments, policies, management strategies, actions and performance in the aspect of sustainable development, and to respond tostakeholders’ concerns regarding the Company’s sustainable development-related matters, SF annually identifies and updates ESG materiality issuesthrough a combination of questionnaire surveys and on-site interviews. These issues are comprehensively integrated into the Company’s operationalmanagement work, continuously strengthening the management and practice of sustainable development within the Company.Process of Assessing Materiality Issues
Step1-Identificationof issuesStep2-StakeholderSurveysStep3-Assessmentof themateriality issuesStep4-Prioritizationof the issues
Based on disclosure requirements at home and abroad, benchmarking analysis against industry peers,mainstream ESG rating concerns and SF’s business relevance, the Company updated its material topicsrepository. The upgraded repository now includes 17 materiality issues across three categories, namelyenvironment, society, and governance.Materiality issues were compiled into questionnaires distributed to internal and external stakeholders.Stakeholders were asked to rate the materiality of each ESG topic on a scale of 1 to 5, providingsuggestions for each issue’s priority based on their expectations and demands. Additionally, interviewswere conducted with key stakeholders to assist in determining materiality issues and responding tostakeholder expectations.Based on the results of effective questionnaire evaluations, an analysis of materiality issues wasconducted to identify those most relevant to SF’s sustainable development in 2023.Materiality issues were prioritized based on two dimensions: “The importance to stakeholders” and “Theimportance to the Company’s development.” The matrix of SF’s materiality issues in 2023 was developedand reviewed by the Board of Directors.
Safety delivery andtransportationData security andprivacy protectionRespect and guaranteeof human rightsEnergy management andcarbon emission reduction
Emission managementSustainable supply chainsRural revitalization,charity and volunteeringResponse toclimate change
Diversity and inclusion
Low
The importance to the Company’s development
The importance to stakeholders
GovernanceEnvironmentSociety
High
High
Corporate governanceOccupational health andsafety management
Product andservice optimizationBuilding agreen and smartindustry chainEmployee training anddevelopment
Anti-corruption andbusiness ethicsEmployee welfare and careGreen packaging andresource recycling
Analysis Result of Materiality Issues
Theme: Forging Ahead withOriginal Mission and Writinga New Chapter Under ConcertedEfforts Led by Party BuildingStandardizing Corporate GovernanceStrengthening Risk Control ManagementAbiding by Business EthicsEnsuring Information Security
GOVERNANCE
Governance
2023 S.F. HOLDING SUSTAINABILITY REPORT
The year 2023 is the starting year to fully implement the spirit of the 20th National Congress of the Communist Party of China(CPC). SF is determined to make another progress in the new journey. Blessed with the leadership of the Party, SF promotes theparty building and the growth of the Company, fulfills corporate social responsibility, and contributes to the development of thetimes.Standing Firm in Our Beliefs and Convictions Under the Leadership of the PartyFocusing on the Importance of Policies in Development, and Integrating Party Building into ManagementUnder the leadership system of “two-way entry and cross-appointment” for the Party Committee team, SF has built the Party Committee comprisingall senior executives of the Company. Besides, the practice of Party building is included in our Articles of Association to ensure the implementation ofthe principles and policies of the Party during our development.Advocating the Learning of Party’s Ideology and Organizing Thematic EducationIn 2023, SF carried out extensive thematic education on Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and studied andimplemented the spirit of the 20th CPC National Congress. The Company formulated and released an implementation plan for thematic educationthroughout the year, encouraged Party members and comrades to read the original versions of books and articles and comprehend the theories,and subscribed a total of 4,400 books on thematic education for Party members. The Company also organized party workers to carry out thematiceducation and learning in Jiaxing, striving to cast the soul, increase wisdom, correct the atmosphere and improve proactivity by learning.
Training class of thematic education on the study and implementationof Xi Jinping Thought on Socialism with Chinese Characteristics for a
New Era
SF Party Committee won the Group Champion of Shenzhen Express
Industry Party Committee Knowledge Competition
Theme
Forging Ahead with Original Mission andWriting a New Chapter Under ConcertedEfforts Led by Party Building
Governance
2023 S.F. HOLDING SUSTAINABILITY REPORT
Celebration of the 102nd Anniversary of the Founding of the CPC and
The “July 1” Commendation Conference
Party and Mass Service Center of SF Group
Conducting High-standard PartyBuilding and Strengthening Primary-Level Party BuildingAdhering to the Principle of “One Synchronization” and “TwoCoverage”
For a more comprehensive coverage of Party organization andleadership, the Company has made continuous efforts to optimizethe building of primary-level Party organizations, and has establishedParty branches in new business units in a timely manner to expandthe coverage of Party organizations. In addition, SF adopts a Partybuilding management model of “centralized guidance and localizedmanagement” for branches across the country. In 2023, the Companymanaged 93 Party organizations with 2,323 Party members, andcoordinated the management of 76 local Party organizationsnationwide.Reinforcing the Construction of Party Building Front to Provide StrongSpiritual Support for Party MembersBased on the “1+N” pattern, the Party Committee of the Companydirects the construction of the Party building front in each region,including the design of exhibition walls with focuses on theorganizational building and elegance of Party members to promote theParty building culture, trying to build important platforms to serve Partymembers. Meanwhile, on the basis of the Group’s original Party andmass service centers, 15 new Party building stations have been set upin Shenzhen, of which the Party and Mass Service Station of NanshanBranch is recommended as an investigate site for the educationmanagement of Party members in Shenzhen.
Carrying out High-quality PartyMembers Activities to Stimulate TheirVitality as a PioneerTo be fully prepared for the “Double Eleven” business peak, the PartyCommittee of SF issued the Party Members Pioneer Action Initiative,calling on all primary-level Party organizations and the majority ofParty members to take the initiative in the prompt establishment of the“Pioneer Team of Party Members” to support the front line and serve asa strong reserve force to win the “Double Eleven” peak battle.In addition, SF arranged an array of activities to celebrate the 102ndanniversary of the founding of the CPC, and encouraged couriers whowere Party members to play a part in urban governance, and serve as a“mobile probe” in civilized city construction, urban environment, andresident services.
Party member Qin Wenchong won the 27th “China Youth May
Fourth Medal”
SF Aviation Department was awarded “National Workers Pioneer”
In the “seven goals for the youth in the new era” series of activities,each primary-level party organization actively recommended its excellentparts for the appraisal of role models:
In 2023, the coverage of the Company’s Party building was ashigh as85%.
Governance
2023 S.F. HOLDING SUSTAINABILITY REPORT
Standardizing Corporate GovernanceCorporate GovernanceSF has formulated the Articles of Association, the Rules of Procedure for General Meeting of Shareholders, the Rules of Procedure for Board ofDirectors, and the Rules of Procedure for Supervisory Committee and other internal control rules and regulations to improve the internal corporategovernance structure and the internal management system and regulate the conduct of the Company. The Company has clearly defined theresponsibilities and authorities of decision-making, execution and supervision, established a corporate governance structure composed of the generalmeeting of shareholders, Board of Directors and Supervisory Committee, and formed an effective division of labor and restraint mechanism with clearrights and responsibilities and standardized operation.
General meeting ofshareholders
Ofce of the Board
of DirectorsStrategyCommittee
Remuneration andAppraisal Committee
Risk ManagementCommittee
Board ofDirectors
SupervisoryCommittee
NominationCommittee
AuditCommittee
General Meeting of ShareholdersThe Company convenes and holds general meetings of shareholders in strict compliance with relevant laws and regulations, engages lawyers to attendthe general meeting as observers and issue legal opinions on the holding and voting procedures of the general meeting, and gives full respect to andprotects the legitimate rights and interests of all shareholders and investors. The Company’s controlling shareholders strictly regulate their behaviors,exercise their rights through the general meeting, and do not interfere with the Company’s management or decision-making directly or indirectly bypassing the general meeting and the Board. In 2023, SF held 3 general meetings.
SF’s Governance Structure
Governance
2023 S.F. HOLDING SUSTAINABILITY REPORT
Board of DirectorsSF’s Board of Directors is composed of 7 directors, of which 4 are executive directors and 3 are independent non-executive directors. In 2023, theCompany, giving full play to the decision-making functions, held a total of 9 board meetings to study and make decisions on major matters such asrelated-party transactions, exercise of equity incentives, and external guarantees. In strict accordance with the requirements of the Company Law, theArticles of Association and the relevant laws and regulations of the China Securities Regulatory Commission and the Shenzhen Stock Exchange, SF hasmeticulously conformed to the relevant procedures of the board meeting, and made timely disclosure of information after the meetings.The Board of Directors has established five special committees, namely the Strategy Committee, the Remuneration and Appraisal Committee, theRisk Management Committee, the Nomination Committee, and the Audit Committee. In 2023, these special committees held a total of 11 meetings.All directors diligently fulfilled their duties with an industrious and responsible attitude. The independent directors perform their responsibilitiesindependently, protect the overall interests of the Company, and express independent opinions on important and major issues.
Performance of Duties by Special Committees of SF’s Board of Directors in 2023StrategyCommittee
Consider the overall development strategy and sustainable development strategy of the Company, superviseand guide the ESG implementation, and make recommendations to the Board of Directors.Remunerationand AppraisalCommittee
Ensure that the remuneration system serves the Company’s business strategy and is subject to constantadjustment to support the Company’s further development.Risk ManagementCommittee
Guide the Company’s overall risk management, evaluate the completeness of the risk management systemand issue opinions, and provide support for the Board of Directors to perform risk management functions.NominationCommittee
Make decision and provide professional recommendations on the candidates, selection criteria and selectionprocedures for directors, general managers, and other senior management appointment of the Company.Audit Committee
Give full play to the role of audit supervision, review audit work reports every quarter and provide guidanceand suggestions, promote the establishment and improvement of internal controls, standardize theCompany’s business behaviors, optimize business management, and avoid business risks.
Diversity of the Board of Directors
The members of the Board of Directors were experienced in different industries, with different educational backgrounds and professional qualificationsin engineering, economics, law, accounting, and business administration, comprising a well-balanced group of directors in line with SF’s BoardDiversity Policy. There were two female directors in the Board, representing 28.6% of the Board.Supervisory CommitteeSF’s Supervisory Committee comprises 5 supervisors, of which 2 are employee representatives and 3 are non-employee representatives. In 2023, SFheld 6 meetings of Supervisory Committee in total, and each supervisor attended the meetings in earnest, performed their duties conscientiously, andsupervised and expressed their opinions on the Company’s major issues, related party transactions and financial situation.Compliant Information DisclosureSF honestly fulfills the information disclosure obligations, strictly follows the regulations and requirements of the China Securities RegulatoryCommission as well as the Shenzhen Stock Exchange on information disclosure and the relevant provisions of the Company’s Management Systemfor Information Disclosure in our information disclosure work. The company further intensifies the collection, feedback, collation, and review of majorinformation, so as to ensure the truthfulness, accuracy, completeness and timeliness of the information disclosed.
Governance
2023 S.F. HOLDING SUSTAINABILITY REPORT
Strengthening Risk Control Management
SF has established a sound internal control and risk management system to strengthen and standardize the internal managementof the Company, continuously improve the effects of risk prevention and control, and promote the sustainable and healthydevelopment of the Company. The Company also actively identifies and assesses environmental, social and governance (ESG) risksin operation and development, and clarifies the response strategies for such risks to effectively reduce operational risks.
Risk Management SystemSF has established a risk management structure led by the Risk Management Committee of the Board of Directors. The Risk Committee under the RiskManagement Committee of the Board of Directors, led by the Chief Financial Officer (CFO) of the Company, is a professional decision-making bodyfor the overall management and control of the Company’s risks. The Committee is mainly responsible for deliberating and making decisions on thebuilding of the Company’s risk management system, policies, prevention of major risks and response to major crises. The Risk Committee reports tothe Risk Management Committee of the Board of Directors on a quarterly and annual basis. The Risk Control and Compliance Office of the Companycoordinates the management of risk control and compliance; while the leader of each functional department, BG (Business Group), BU (BusinessUnit) and region has the primary responsibility for the relevant risk control, responsible for the formulation of specific risk control measures andimplementation rules, as well as the identification and assessment of daily risks and the implementation of control measures.
SF Risk ManagementOrganizational Structure
Risk Management Committeeof the Board of DirectorsRisk Committee (CFO)
The Company’s Risk Control
and Compliance Ofce
The Company’s Functions,BGs/BUs and Subsidiaries, etc.
Strategy FormulationOrganization:
Strategy Formulationand Guidance
Overall ManagementOrganization:
System Optimization,and Control
ImplementationOrganization:
Routine Managementand Execution
Uniedadministration
UniedoperationAssessment
ReportFeedbackOptimization
Governance
2023 S.F. HOLDING SUSTAINABILITY REPORT
Risk Management Practices
SF continues to improve its risk management system on the basis of the Company’s comprehensive risk management system. In 2023, SF newly builta compliance risk management system in various fields including environmental protection, safety production, anti-monopoly and unfair competitionby comprehensively sorting out compliance requirements and referring to domestic and international advanced experiences. SF also synchronouslyupdated policy documents such as the Risk Control and Compliance Management Policy, and the Risk Event Management Policy to consolidate theCompany’s risk management capabilities.Enhancement of Digital Risk Management Capability
SF has continued to strengthen its digital risk management capability by continuously upgrading the Company’s risk management system, internalcontrol and compliance system and compliance management system. Through continuous iterative optimization of the systems, SF has achieved thedigitization of the entire chain from risk identification, assessment, monitoring, early warning, response, to loop closing, thereby effectively improvingthe efficiency of risk identification and management.
In 2023, SF completed the building of its compliance management system, applying intelligent algorithms to mark and aggregate complianceinformation in a systematic way, and enhancing its ability to aggregate, precipitate, analyze, share and proactively manage compliance informationin an intelligent manner, thus realizing the scheduled position-based push of compliance information and improving the efficiency of compliancemanagement. In addition, the Company has optimized the risk management function and launched the risk event database at the mobile end tofurther enhance the efficiency of risk management.
Risk Management SystemResponsible for monitoring risk management and control in priority areas of the Company andmanaging risk events.Internal Control and Compliance PlatformResponsible for conducting regular internal control inspections of the Company’s businessprocesses and supervising rectification.Compliance Management SystemResponsible for intelligently capturing and analyzing external regulatory requirements and publicopinion information, and monitoring the quality of internalization of external regulations.
Governance
2023 S.F. HOLDING SUSTAINABILITY REPORT
ESG Risk ManagementSF regularly carries out the identification and sorting of risk information database, and fully integrates environmental, social and governance risks intothe original level 1, 2 and 3 risk level database. The ESG risk management structure is consistent with SF’s risk management organizational structure,with the Risk Management Committee of the Board of Directors as the highest risk management body responsible for the identification, preventionand control of ESG risks.At present, SF has identified 16 types of ESG risks including natural disaster risk, intellectual property risk, fraud risk, safety production risk, humanresource management risk and others. Environmental risks contain carbon neutrality risk, operation risks under extreme weather and high temperature,covering a wide range of the ESG field. (Please refer to the “Climate-related Information Disclosures” for the governance, countermeasures andtargets of climate change risks.)
Loop-closing Management of Risk EventsSF has established a sound risk event management system, which realizes graded risk event management through risk labels, and strengthens thewhole-process risk management of pre-event prevention, in-event response and post-event review, so as to enhance the efficiency of risk eventmanagement and control.
Pre-eventPreventionRegularly carry outrisk assessmentto understand thecurrent situation ofrisk management andcontrol, continuouslyoptimize the riskmanagement andcontrol mechanism, andreduce the probability ofoccurrence of risk eventsfrom the source.
Post-eventReviewSummarize the incidentwith the relevantdepartments, dig outroot causes, promote thedepartments to formulateoptimized solutions, andcontinue to consolidatethe basic capabilities ofrisk event management.
In-eventResponseRespond with multipledepartments to addressrisk events accordingto local conditions andminimize the negativeimpacts caused thereby.
Risk Management TrainingSF continues to organize diversified risk training and empowerment courses to strengthen employees’ risk awareness through offline training, onlinelearning, examination and other forms. In 2023, the Company conducted a total of 29 training courses on risk compliance, covering such risk areasas product and service quality, anti-monopoly and unfair competition, export control and trade sanctions, and intellectual property rights. A total of86,400 hours of risk-specific training courses were conducted throughout the year, and the coverage rate of new employees reached 100%.
Based on risk event management, the Company carried out a targeted refresh of the risk scenario and deposited 26 risk responsemanagement and control plans in 2023.Based on the summarized response experience of historical risk events, the Company considered medium- and high-risk points into businessscenarios to prepare corresponding risk plans, achieving 100% coverage of medium and high-risk points.
In 2023, the Company held 24 weekly meetings on risk control, generating a total of 52 resolutions, of which 4 meetings and 5resolutions were related to ESG issues.
Governance
2023 S.F. HOLDING SUSTAINABILITY REPORT
Abiding by Business EthicsSF adheres to compliance operation and business ethics. The Company has established a management mechanism led by theAudit Committee of the Board of Directors, while the Chief Audit Executive (CAE) is responsible for the overall management ofthe Company’s business ethics affairs, including anti-corruption, anti-money laundering and anti-unfair competition, and regularlyreports to the Audit Committee. For primary-level managers, the Company formulated the “369 Code of Conduct”, which put anend to three violations of business ethics, required six affairs to be made public, and established nine guidelines for managers to setan example and adhere to business ethics in operation and management. In 2023, SF had no legal litigations related to impropercompetition and anti-monopoly.
Integrity Management SystemSF analyzes the causes of corruption incidents investigated and punished every year, confirms whether there are deficiencies in processes andsystems, and updates the internal policies with necessary iterations to ensure the effectiveness of the Company’s integrity management as wellas anti-corruption policies and systems. In all relevant policies, SF explicitly prohibits bribery, illegal kickbacks, non-compliance business gifts andother violations, clearly defines the approval and control process involving sensitive transactions such as large gifts, and provides employees andmanagement with specific rules and operational guidelines on acceptable behaviors and approval procedures. In 2023, the Company evaluated andupdated its integrity management policies, such as Reward and Penalty Management Regulations, further improving the penalty rules for violation ofintegrity-based incidents and providing guidance to employees and management when faced with business ethics dilemmas.The Company has established a defensive line for integrity supervision from the Audit Committee of the Board of Directors, the regulatory departmentat the headquarters to the business areas/branches. Three defensive lines have also been established simultaneously within business areas/branchesto achieve an integrity management system that runs through the whole network and all positions of management. In addition to the two-level threedefensive lines, the Company has also set up a Senior Executive Discipline Inspection Committee and an Employee Discipline Inspection Committee ledby the Chief Executive Officer (CEO), the Chief Human Resource Officer (CHO), and the Chief Audit Executive (CAE). These committees are respectivelyresponsible for managing the integrity and discipline of senior management and other employees.
Senior Management Disciplinary
Inspection Committee
Employee DisciplineInspection CommitteeLed by the CEO, CHO and CAE
SF’s Defensive Lines for Integrity Supervision
Three DefensiveLines for Integrity
Supervision
The first line: Businessareas/branches
The third line: Company auditThe second line: Regulatory department atthe headquarters for each segmentLegal affairs/Compliance/Internal control/Risk control, etc.
Business
Areas/Branches
Business owners/outlets
Risk Control Group ofOperation and Management
Department
Employee RelationshipGroup of Human Resources
Department
Governance
2023 S.F. HOLDING SUSTAINABILITY REPORT
To create a fair, just and open working atmosphere, SF has also established an anti-corruption system of “no courage, no ability and no intention” tostrictly prevent and sternly punish illegal and corrupt behaviors such as bribery, acceptance of bribery, embezzlement, and fraud.
SF’s“No Courage, No Ability and No Intention” System for Anti-corruption
Anti-Corruption ManagementSF integrates anti-corruption management into its daily operations, and continues to strengthen the Company’s ability to control anti-corruption,anti-bribery, anti-money laundering and other ethical business behaviors through anti-corruption risk assessment, anti-corruption audits, and anti-corruption education.Risk Assessment on Anti-CorruptionSF has built an anti-corruption risk assessment mechanism to identify and assess the relevant risks in each business area, and formulated relevantresponse initiatives in parallel to strengthen anti-corruption risk management. In 2023, SF continued to explore anti-fraud risks, identified andexported more than 500 anomalous clues, and launched the “Action of Purity” to rectify potential risk points.In addition, SF conducts an annual review of the effectiveness and compliance of internal controls to prevent and detect bribery and corruption risksin a timely manner. Once relevant risks are identified, SF will report the risks, violations and countermeasures directly to the Audit Committee of theBoard of Directors.Anti-Corruption AuditSF has included anti-corruption in its key audit areas to identify and assess potential risks, so as to ensure the effectiveness of its internal anti-corruption management system, and safeguard the Company’s compliance operation. In the past three years, the percentage of all operational sitesfor which an internal audit/risk assessment concerning business ethics issues has been conducted was 100%.In addition, SF conducts third-party external audits every year to independently review the Company’s business ethics and sort out and identifypotential business ethics-related risks in the Company’s operations.Anti-Corruption EducationSF has formulated the Employee Handbook and Integrity Handbook to clarify the Company’s definition of internal and external integrity behaviors, thedefinition of violation behaviors and the corresponding penalties, thus providing all employees with a clear and reliable code of conduct, to regulatethe behaviors of the employees, and to advocate honest practices.
Lay a solid foundationof “no intention to be
corrupt” ideologyCommitment signingPropaganda and education
Special learningOrganization atmosphere
Create a “no ability tobe corrupt” governance
environment ofOrganization governanceSystems and standardsDemocratic supervision
Create a workingatmosphere of “nocourage to be corrupt “Active anti-fraudProfessional investigationand punishmentStrict accountability system
Governance
2023 S.F. HOLDING SUSTAINABILITY REPORT
In 2023, SF actively carried out special training on integrity topics through a variety of online and offline channels to organize all employees to learn,to know and to abide by the rules together. Integrity related training covers 100% of the employees, with a total of 70,073 hours of anti-corruptioneducation. Among them, 20 offline special anti-corruption training sessions were held throughout the year.
2023 Integrity Training ProgramIn order to prevent and combat against all kinds of corrupt behaviors, SF actively encourages all employees to sign the Letter of Commitment to Anti-corruption, to protect the legitimate interests of the Company, employees, customers and partners from infringement, and to promote the sustainableand healthy development of the Company. In 2023, the rate of the workforce signing the Letter of Commitment to Anti-corruption reached 99.0%,up 4.4% from that in 2022.In addition, the Company requires cooperative suppliers to sign the Integrity Agreement to jointly build an integrity value chain. In 2023, the rate ofsuppliers signing the Integrity Agreement reached 100%.
SF’s Anti-Corruption Propaganda and Education
Exposure bulletinEarly warning fordisclosure ofviolation of rulesor disciplines
Propaganda andpromptsPositive guidanceCommendation ofexamples
SysteminterpretationRed line under
rulesReporting
channelsRewardmechanismSituationalguidance
Cautionary formJudicial fraudcase disclosurewarning
Integrity briefingMonthlydisclosureHot issues andconcerns
Anti-corruptionannouncement
Illegal fraudAnnualannouncement
“Honesty and Integrity – Double Full Pass”:
SF launched the “Honesty and Integrity – Double Full Pass” action for all employees, and a total of115,000 employees participated in learning and examination.“Preventing and Controlling Risks for Operation”:
The integrity-themed training, “Preventing and Controlling Risks for Operation”, was conducted for keypositions and specific functions, covering more than 3,500 employees.Management Lectures:
10 sessions of “Management Lectures” were held for management, covering core values, culturalconcepts, integrity and anti-corruption, with more than 6,600 people participated in total.
The Company understands the internal integrity situation through regular research on integrity index. At the same time, the Company continuouslycarries out publicity and education on integrity culture which covers all employees, promotes the anti-corruption system and initiatives to theemployees through various forms, including policy interpretation, integrity briefings and anti-corruption announcements. Furthermore, the Companyalso adopts a combination of online cases and offline training to carry out positive propaganda on integrity culture and negative warnings on fraudcases to strengthen employees’ anti-corruption awareness.
Governance
2023 S.F. HOLDING SUSTAINABILITY REPORT
Reporting channelsSF provides multiple open 7*24 reporting channels for internal and external stakeholders, including e-mail, hotlines, and the Company’s officialwebsite, to encourage employees, suppliers and other stakeholders to actively expose violations. At the same time, the Company has established amutual communication mechanism to understand the plight of employees on business ethics through employee symposiums, internal media and otherforms.
Reporting channelsTarget groupReporting e-mailsf5198@sf-express.com
All internal employees and externalstakeholdersSF official websiteAbout us – I want to reportMailingSF Headquarters – Audit Department (Receipt)Forespace APPService – I want to report
All internal employeesLabor union hotline4006883783Upon receipt of the report, SF will act as soon as possible, requiring the relevant department to follow up, and make immediate and positive responsesin accordance with the “Triple Ones” (“三个一”) timeliness requirements.
After the investigation and review of any violations, the Company will take disciplinary action against the responsible person involved, dependingon the severity of the violation. If the violation is suspected of being illegal, the responsible person will be referred to the judicial authorities forprosecution.
Excerpts from the Anti-Corruption Commitment:
? I will refuse to engage in any bribery, acceptance of bribes, embezzlement and other improper business practices during the tenure of
office.? I will refuse to engage in any behavior that conflicts with the interests of the Company during the tenure of office, unless prior writtenand explicit intention is obtained from the Company.? During employment, if any unit or individual related to the business of the Company offers or request any gift to me during the tenure
of office, I will refuse and promptly report to the Company.
“Triple Ones” Requirements:
? Response within one working day: Respond to the whistleblower within one working day upon receipt of the report.? Case confirmation within one week: Confirm whether a case needs to be filed for investigation within one week upon receipt of the
report.? Completion of the investigation within one month: Complete the investigation of the report and provide the results within one month of
confirming the case.
In 2023, SF achieved a 100% follow-up rate for effective reports and a 96% compliance rate for the “Triple ones” requirementsregarding time-efficient complaint handling.
Governance
2023 S.F. HOLDING SUSTAINABILITY REPORT
Whistleblower Protection
SF has clearly defined the requirements for confidentiality of whistleblower information in its Reporting Management Measures: Any employee whohas access to information reported shall keep the information confidential. The responsible person of each organizations the first person responsiblefor the protection of witnesses (including whistleblower), and shall take reasonable measures to protect witnesses (including whistleblower), ensurethat the basic rights and interests of witnesses (including whistleblower) are not infringed, and stamp out any form of retaliation.In 2023, there is no breaches of privacy for anonymous whistleblowers in SF.
Intellectual Property ProtectionHaving attached great importance to the protection of intellectual property, SF continuously improves its internal intellectual property managementsystem. In 2023, SF revised the Patent (Software Copyright) Achievement Management System, updated the rules for managing intellectual property asintangible assets, and the rules for the inventory of intellectual property assets and capital utilization. In addition, the Company formulated a gradingand classification standard for intellectual property. Experts in various fields completed the grading and classification of existing intellectual property,enabling fine management of the value of intellectual property.The Company actively conducts intellectual property training by offering courses such as Intellectual Property Protection and Operation, Patent Miningand Application Training and Patent Protection and Compliance for Overseas Business Operations. These courses encourage all types of talents todevelop expertise in their respective fields and help to raise employees’ awareness of intellectual property protection.
SF ’s Measures for the Management of Whistleblowing sets out the confidentiality requirements for whistleblower information,including but not limited to the following:
? All personnel who receive information reported shall submit the information to the department in charge of whistleblowing and shallnot, at their discretion, disclose the information to other personnel.? Personnel involved in the follow-up of the report shall not disclose the relevant information to other personnel.? Investigation results and handling opinions shall not be disclosed prior to the assessment and public announcement of the disciplinary
opinions.? Investigation reports and evidence shall not be disclosed to other personnel at their discretion.
At the end of the reporting period, SF had 4,093 patents in force or pending and 2,490 software copyrights. Of these, inventionpatents accounted for
59.3% of the total patent portfolio.
Governance
2023 S.F. HOLDING SUSTAINABILITY REPORT
Ensuring Information SecurityInformation and Cybersecurity Management SystemSF remains highly vigilant with regard to information security and cybersecurity risks. The Company continuously improves its internal informationand cybersecurity management system. The Company also updates and iterates its internal policies and related measures in accordance with thelatest relevant domestic and international laws, regulations, as well as data protection standards. These efforts strengthen the foundation for dataprotection and network information security.In 2023, SF updated its information and cybersecurity governance structure by establishing a 3-layer information security and privacy managementstructure that includes decision-making, management and execution organizations.
Information and Cybersecurity Governance StructureSF Technology Information and Cybersecurity Management System has obtained ISO 27001 Information Security Management System Certificationand ISO 27701 Privacy Information Management System Certification, covering the Company’s main business operation scenarios. In addition, the SFExpress app has passed the Level 3 Protection Assessment for Cybersecurity Classification Protection, and the CCRC Certification in Mobile InternetApplication (Andriod/IOS) Security.
Decisionmaker
Information Security and Privacy Committee
Composed of the CTO, the CEO and the CFO of the Company
Be responsible for information security and privacyprotection decisions, appointments and instructions,as well as supervision and audit of personalinformation protection related mattersInformation Security and Privacy Protection Working Group
Led by the Chief Information Security Officer, with an InformationSecurity Center, various business lines, and a Legal Affairs Center
Coordinate and organize the Company’s informationsecurity and privacy protection governanceManagementDepartments and Business Units
Composed of functional departments and business units
Implement specific information security and privacyprotection governance measuresExecution
ISO 27001 Certification
ISO 27701 Certification
CCRC (Andriod) Certificate
CCRC (Andriod) Certificate
Level 3 Cybersecurity Certificate
Governance
2023 S.F. HOLDING SUSTAINABILITY REPORT
Information and Cybersecurity Management
SF attaches great importance to information and cybersecurity. Several systems have been established to guide the response mechanisms andhandling initiatives of information and cybersecurity incidents. The Company’s security defense capabilities are strengthened through cybersecurityvulnerability detection, cyberattack drills and other measures. In addition, high-risk behaviors related to internal information and cybersecurity, and thecorresponding disciplinary principles for violations have been clarified to standardize the behavior of employees in this regard.SF regulates the collection, use, sharing, and retention of user privacy data according to the latest domestic and international laws and regulationsto ensure that user data is obtained through legitimate and transparent means. Adhering to the principle of “Minimization” in data collection, theCompany ensures that the user data is collected and processed within the prescribed scope.SF regularly conducts data security audit and assesses internal and external data security risks in accordance with the latest regulatory requirements.Based on the assessment results, the Company improves the information and cybersecurity management system accordingly.
Assessment of Graded Protection:
The security compliance of information systems is monitored and assessed based on national and industry standards andspecifications. This assessment enables the Company to gain a timely understanding of the security protection status ofinformation systems and to assess their security protection capabilities. In addition, targeted corrective actions can beproposed for any identified security issues and potential risks.Internal Audit of the Management System:
Internal audits of the information security management system are carried out in accordance with ISO 27001, ISO 27701and other relevant standards in terms of compliance, applicability and sufficiency. Any issues identified are addressedpromptly to ensure the reliability of the Company’s information and cybersecurity system.Security Response Center (SRC):
The SF SRC is designed to enable potential internal risks to be identified externally and remediated in a timely manner,and to reward users who discover security vulnerabilities in the systems and operations.
In order to strengthen information and cybersecurity management, SF has taken various measures to improve the data security awareness and datasecurity and personal information protection skills of all employees, thereby enhancing the foundation of SF’s data security.Red-blue confrontation drillIn March 2023, SF conducted a two-week Red-blue confrontation drills in collaboration with the attack team of an external security company. The drillsimulated classic scenarios of various external cyberattacks. Throughout the drill, the Company continuously identified weaknesses in the cybersecuritydefenses system and reviewed them for improvement. The aim of the drill was to improve the collaboration and emergency response capabilities ofour security team, thereby strengthening the Company’s data security capabilities.
SF Data Security Risk Assessment
Governance
2023 S.F. HOLDING SUSTAINABILITY REPORT
Employee TrainingInformation Sharing in Cybersecurity: In 2023, SF organized a total of 16 technical cybersecurity sharing activities and 28 security awarenesscampaigns for relevant professionals.Data Lifecycle Training: Focusing on the data lifecycle, SF developed a series of training courses covering the collection, classification and grading,transmission, use, exchange, and destruction of data. These courses significantly enhanced employees’ professional understanding of data security andincreased their awareness of privacy compliance. In 2023, these training courses totalled over 1,200 hours.Information Security Education for All Employees: SF continuously carries out information security education for all employees, emphasizing theimportance of privacy protection and raising awareness of information security through various means such as special training and publicity. In 2023,SF essentially achieved full coverage of data security education, with more than 650,000 participants on a cumulative basis.By the end of 2023, SF had led and participated in the development of 5 national and industry standards on data security, with 3 national standardsofficially published, contributing to promote the standardization and normalization of data security in the industry.
StandardStatus
National standard Information Security Technology – Data Security Requirementsfor Express and Logistics Services (GB/T 42013-2022)
Officially published in October 2022
National standard Information Security Technology – Basic Requirements forCollecting Personal Information in Mobile Internet Applications (GB/T 41391-2022)
Officially published in April 2022
National standard Information Security Technology – Implementation Guidelinesfor Notices and Consent in Personal Information Processing (GB/T 42574-2023)
Officially published in May 2023
National standard Information Security Technology – Security Requirements forProcessing of Sensitive Personal Information
Officially open for public consultationin August 2023
Cyber Security Standard Practice Guide – Data Classification and GradingGuidelines
Officially published in December 2021
Governance
2023 S.F. HOLDING SUSTAINABILITY REPORT
Third-Party Data ManagementSF also pays close attention to data security during its cooperation with third-party partners. Prior to any data interaction with third-party partners,the Company conducts thorough data security due diligence to assess the risk in their information security qualifications, information security policies,human resources security, physical security, and data security (including data collection, storage, provision, use, backup, and disaster recovery). Bydoing so, the Company strives to mitigate the risks associated with data security in third-party collaborations.In 2023, the Company updated its supply chain security agreement to include additional data security requirements for suppliers. These requirementscovered the destruction and return of data upon termination of the collaboration, the establishment of contingency plans for data securityincidents, the protection of data centers, the business continuity plans, etc., aiming to standardize the management of data security throughout thecollaboration.Personal Information ProtectionSF fully recognizes the significance of personal information security. In accordance with relevant laws, regulations and industry best practices, acomprehensive privacy management framework and the personal information security and compliance policies have been developed and continuallyenhanced, serving as guidelines for appropriate personal privacy protection practices. In order to effectively protect personal information, variousmeasures covering the digital lifecycle have been put in place to ensure the security of customer privacy in a responsible manner. In 2023, there wereno significant breaches of privacy and information security in SF.
Measures to Protect Personal Information
Mechanism for Receiving and Responding to Requests Regarding Personal Information Rights
SF has established a mechanism for receiving to requests regarding personal information rights. Prior to the collection andprocessing of user data for business purposes, users will be promptly informed of their personal information rights and relatedinformation through means such as privacy agreement check boxes and device pop-ups. In addition, users’ requests to exercisetheir personal information rights are responded to within the specified timeframe as required by the law.
Strengthening the Technical Foundation of Privacy ProtectionSF keeps improving its data security technology capabilities, including unified privilege management platforms, automatedencryption/decryption platforms, log management and analysis tools, and personal data desensitization. The aim of these effortsis to protect users’ personal information from unauthorized access, manipulation, disclosure, corruption or loss.
Privacy Waybill ProtectionSF desensitizes the fields on the express waybill that contain users’ personal information, namely the names, contact andaddress details of the sender and recipient. In addition, delivery personnel and customer service representatives communicatewith customers using virtual phone numbers. This effective management of the risks associated with data sharing enhancesusers’ privacy experience.
Personal Data Lifecycle Security Management
Under the data lifecycle theory, the personal information involved in the business activities is subject to classification andgrading management. SF takes protective measures such as encryption, de-identification, and access control during the datacollection, transmission, use, and storage processes, depending on the sensitivity of the data and the principle of minimumnecessary rule. These measures aim to effectively protect personal information security.Security Incident Detection and Response
SF uses a security incident investigation and response platform to monitor both internal and external threat signals targetingsensitive data in real time. This platform allows for immediate identification of abnormal operations and high-risk behaviors thatmay pose the risk of personal information leakage. Once an abnormality is identified, the Company immediately launches aninvestigation and takes measures to minimize the risk of personal information leakage at the source.
Theme: Exploring Value through Carbon,Racing towards the Zero-Carbon Future
Creating Green LogisticsPromoting Circular EconomyProtecting the EnvironmentGreen Of?ce
ENVIRONMENT
Environment
2023 S.F. HOLDING SUSTAINABILITY REPORT
Theme
Exploring Value through Carbon, Racingtowards the Zero-Carbon FutureWith the implementation of the national “dual carbon” strategy, the green and low-carbon development concept has graduallypenetrated into various economic activities across industries. The logistics industry, as a fundamental, strategic, and leading industrysupporting national economic development, is trending towards the establishment of a green, low-carbon, and efficient logisticstransportation and distribution system.As an enterprise with a strong sense of social responsibility, SF actively responds to the national “dual carbon” policy, adheringto its original intention of sustainable development. SF is committed to driving green and low-carbon changes in the industry withits own efforts and extending green value to the industrial chain, working together with upstream and downstream partners toachieve a zero-carbon future.Developing the Industry-First Carbon Calculation Model, Consolidating theFoundation for Green TechnologySince officially publishing the white paper on carbon targets in 2021, SF has been committed to building an integrated green and low-carbonsupply chain service capability that is environmentally friendly, green, and low-carbon for sustainable development. Its aim is to reduce the impactof greenhouse gases on the global environment through the management of supply chain carbon emissions across all links of the industrial chain.In recent years, SF has built a standardized carbon management system and independently developed a digital and intelligent carbon managementplatform called the “Fenghe Sustainability Platform”, which integrates the Company’s carbon emission and carbon reduction data, covering multiplelinks such as packaging, transportation, transfer, and delivery.Based on SF’s standardized carbon management capabilities, in 2023, the Company independently developed the industry’s first shipment-levelcarbon calculation model. This model not only simulates the scenarios of cargo transportation to calculate greenhouse gas emissions generated byvarious modes of transportation, but also supports the calculation of the actual greenhouse gas emissions and emission reductions generated by eachshipment in all stages of “collection, transit, transportation, and delivery”. It achieves fine-grained and automated calculation of carbon data formassive shipments, continuously consolidating the foundation of SF’s green technology capabilities.
The Industry’s First Shipment-level Carbon Calculation Model Independently Developed by SFProviding Low-carbon Supply Chain Solutions, Empowering Industrial ChainPartnersAs a benchmark enterprise actively promoting and implementing the “dual carbon” strategy in the logistics supply chain, SF understands that thevalue of green development goes beyond itself to influence the entire industry chain. Based on its standardized carbon management system and fine-grained carbon calculation capabilities, combined with the leading experience in the logistics industry, SF has reached deep into various industriessuch as new energy, high-tech, clothing, footwear, and luxury goods, providing customized green and low-carbon supply chain solutions and servicesto multiple brand customers. It strongly enables upstream and downstream partners in the industrial chain, collaborating with our customers toaccelerate low-carbon transformation and jointly drive the industry towards a zero-carbon future.
Environment
2023 S.F. HOLDING SUSTAINABILITY REPORT
SF joins hands with a world leading luxury brand to launch a carbonneutrality acceleration plan at the level of supply chainIn 2023, SF signed a letter of intent for a low-carbon strategic service agreement with a leading global luxury brand on “carbon footprint systemand management for the entire logistics supply chain,” officially initiating the LNA+ (Logistics Neutral Acceleration Plus, or “supply chain-levelScope 3 carbon neutrality acceleration”) plan led by SF in the context of logistics supply chain scenarios.Through this plan, not only will the precise carbon footprint of each shipment be calculated, enhancing the transparency and accuracy of carboninformation in the supply chain service scenarios between brand owners and logistics providers, but it will also include customized comprehensiveimprovement actions to enhance the climate resilience of sustainable supply chains, optimize the transportation modes of upstream anddownstream logistics providers, support greenhouse gas emission reduction and offset actions in their supply chains. Additionally, it could reducethe cost of environmental compliance and climate risks in operations, and comprehensively enhance the green and low-carbon operationalresilience of the entire logistics supply chain.
SF’s Intelligent Packaging Algorithm Solution helps the Motorcycle Parts
Company Enhance its Green ValueTo help the motorcycle parts company solve problems such as low warehouse loading efficiency, severe packaging material waste, and hightransportation costs, SF customized an intelligent packaging algorithm system for this company.The system simulates the packaging process through computer modelling, and uses algorithms to accurately calculate the most suitable box sizefor each order. Compared to the traditional method of packaging based on employee experience, the digital packaging tool algorithm achievesprecise and efficient box selection, improves the loading rate of packaging boxes, and significantly reduces the usage of packaging materials.Meanwhile, the adaptation of box sizes effectively reduces space waste during transportation, improves the efficiency of transportation resourceutilization, and also reduces transportation costs. It not only solves the problem of warehouse packaging for customers, but also brings dualimprovements in environmental protection and economic benefits.
The accuracy of carbonemissions data can beimproved by
approximately70%
? Setting carbon targets and conducting
monthly follow-up? Whole-chain carbon footprint managementfrom suppliers to warehousing anddistribution
Carbon accounting
? Providing consultation services for net zero
emission strategy in logistics scenarios? Designing and delivering green and low-carbon logistic services
? Providing customers with servicesincluding carbon accounting,carbon neutrality certification
Carbon emission reduction
Carbon certification
? Assisting customers in acquiring
high-quality carbon credits to offsettheir emissionsCarbon offset
SF’s Intelligent Packaging Algorithm Solution
Increase the loading rate of
packaging boxesProvide the most suitable
packaging solution
Significantly reduce
package waste
Environment
2023 S.F. HOLDING SUSTAINABILITY REPORT
SF Joins China ESG Alliance to Contribute to a Green FutureIn 2023, SF officially joined the China ESG Alliance (hereinafter referred to as the“the Alliance”), which was jointly established by several well-known enterprisesand institutions in the industry. The Alliance integrates professional ESG insightsand ecological development resources, creates an innovation-driven communicationplatform that is supported by digital technology, and hatches green and sustainablesolutions to help enterprises enhance their ESG values.As a member of the Alliance, SF will leverage its leading advantages and successfulpractices in ESG areas, such as green technology innovation and low-carbon logisticssolutions, strengthen cross-industry communication and cooperation, and exertpositive influence as a member enterprise. SF, together with other members, strives todrive ESG development on all fronts and leads the green transformation.
Building a Green and Low-carbon Logistics Ecosystem, Charting a Global CarbonNeutral Blueprint together
Building a zero-carbon business environment is of paramount importance in turning the grand blueprint of global carbon neutrality into reality. SFattaches great importance to cross-industry exchanges and cooperation, and actively engages in professional exchange and sharing activities, strivingto establish long-term and friendly partnerships.Based on the core value of sustainable development, SF fully leverages its leading advantages and successful practices in the field of green and low-carbon logistics to promote cross-industry collaboration. Through participation in and conduct of continuous green and low-carbon special discussions,mutual empowerment, and the establishment of industry standards, it achieves win-win cooperation while driving the development of the industrialchain towards green and low-carbon directions. SF releases its green influence and joins hands with business partners to build a green and low-carbonlogistics ecosystem, contributing to global sustainable development.
SF Conducts Training on Green and Low-Carbon Capability BuildingIn January 2024, SF conducted training session on green and low-carbon capability building with the theme of “Exploring Value throughCarbon, Racing towards the Zero-Carbon future.” This training aimed toactively respond to customer demands for a green and low-carbon supplychain, enhance customer loyalty, and consolidate the Company’s corecompetitiveness.Cantered on the requirements for the development of SF’s green andlow-carbon capabilities, this training session focused on the customer-centric approach, allowing employees to gain more diverse and authenticexternal perspectives from both the macro-environment and thecustomer’s perspective. At the training, domestic and international brandcustomers from various industries such as new energy, high-tech, clothingand footwear, consumer goods, and luxury goods were invited to sharetheir green and low-carbon practices and needs. Internal brainstormingsessions were also conducted, which not only deepened the understanding of the significance and value of green and low-carbon capabilitybuilding but also jointly identified the directions and paths for the company to achieve capability development in the green and low-carbon field.
Exploring Value through Carbon, Racing towards the Zero-Carbon Future——Training Venue for SF’s Green and Low-Carbon Capability Building
Environment
2023 S.F. HOLDING SUSTAINABILITY REPORT
Creating Green LogisticsAiming to protect the environment, save energy and reduceemissions, SF has continuously improved its environmentalmanagement system, realized green management coveringthe whole life cycle of logistics by promoting low-carbontransportation, building a green industrial park, developingsustainable packaging and applying green technology, etc.,and actively created sustainable logistics.
Carbon Reduction Initiatives and Achievements
Photovoltaic PowerGeneration
GreenPackaging
Application of
GreenTechnology
Others
GreenTransportation
Carbon Reduction DirectionCarbon Reduction Initiatives
Green Ground Transportation:
? Optimize transportation capacity, increase the proportion of newenergy vehicles, and promote low-carbon transportation.? Upgrade the loading capacity of vehicles, replace vehicles withhigher axle counts, and improve transportation efficiency.? Phase out high-fuel-consumption vehicles, reduce energyconsumption and pollution, and achieve more environmentallyfriendly ground transportation.
Green Aviation:
? Increase the proportion of low-energy and high-efficiencylarge freighters to promote green aviation transportation.? Increase the proportion of new energy vehicles in air basesto reduce carbon emissions.
? Continuously increase the construction of photovoltaic in industrial parks, and continuously improve the proportion of clean
energy in energy consumption.
? Fully implement packaging reduction, recycling, harmlessness and standardization, and contribute to green logistics.
? Utilizing intelligent transport path planning technology to optimize transport routes and effectively reduce transport energyconsumption.? Actively promote paperless processes, such as electronic proof of delivery (POD), photo uploading, and paperless reimbursement.
? Create the “SF Carbon-Neutral Forest” to achieve carbon offset.? Implement the uniform points redemption mechanism to motivate the courier to reduce the frequency of uniform replacementand reduce material consumption.
In 2023, SF reduced greenhouse gas emissions by1,945,917 tCO
e
Environment
2023 S.F. HOLDING SUSTAINABILITY REPORT
GHG emission intensity (tCO
e/million revenue)
This is the GHG emission intensity data of SF only, excluding Kerry Logistics Network Limited.
41.1
47.6
2022
2023
?14%
1030405060702060,000180,000220,000280,000360,000420,000120,000
374,469
304,029
GHG emissions reduced through green transportation (tCO
e)20222023
?23%
60,000180,000220,000280,000360,000420,000120,0001504506007509001,050300
730.9
824.5
Carbon footprint per parcel (gCO
e/parcel)20222023
?11%
1504506007509001,050300100,000300,000400,000500,000600,000700,000200,000
541,090
506,408
GHG emissions reduced through green packaging (tCO
e)20222023
?7%
100,000300,000400,000500,000600,000700,000200,0003,0009,00012,00015,00018,00021,0006,000
18,339
9,843Photovoltaic power generation (MWh)
2022
2023
?86%,Equivalent to carbon emission reduction
by 10,229 tCO
e
3,0009,00012,00015,00018,00021,0006,000200,000600,000800,0001,000,0001,200,0001,400,000400,000
1,018,436
739,982
GHG emissions reduced through the application of green technologies (tCO
e)20222023
?38%
200,000600,000800,0001,000,0001,200,0001,400,000400,0002507501,0001,2501,5001,750500
1,692
Emission reduction contributed by other initiatives (tCO
e) ( “SF Forest” included)20222023
?180%
Environment
2023 S.F. HOLDING SUSTAINABILITY REPORT
Optimizing Environmental Management SystemSF has established a sound environmental management system and energy management system, and will continue to facilitate the completion ofofficial environmental and energy management system certifications of each business segment. As of the end of the reporting period, all of theCompany’s main business segments have passed ISO 14001 environmental management system certification, and SF Airlines has obtained ISO 50001energy management system certification.
ISO 14001 Environmental
Management System
Shenzhen S.F. Taisen Holding (Group) Co., Ltd.S.F. Express Co., Ltd.S.F. Express Group (Shanghai) Express Co., Ltd.Guizhou S.F. Express Co., Ltd.Shenzhen SF Freight Co., Ltd.GZ SF Pharmaceutical Supply Chain Co., Ltd.Fengyi Technology (Shenzhen) Co., Ltd.Jiangxi Fengyu Shuntu Technology Co., Ltd.Shenzhen SF Comprehensive Logistics Service Co., Ltd.SF Multimodal Transportation Co., Ltd.Shenzhen SF International Supply Chain Management Co., Ltd.Zhejiang Shuangjie Supply Chain Technology Co., Ltd.Shanghai Shunxiaofeng Distribution Co. Ltd.Wuhan Shunfeng Zhida Logistics Co., Ltd.Shenzhen Xingshun Intelligent Supply Chain Co., Ltd.Shenzhen Fenglang Supply Chain Co., Ltd.Shenzhen Chengfeng Business and Enterprise Services Co., Ltd.ISO 50001 Energy Management System
SF Airlines Co., Ltd.RB/T 104-2013 Energy ManagementSystems for Transport Industry
Enterprises
Environment
2023 S.F. HOLDING SUSTAINABILITY REPORT
Promoting Low-carbon Transportation
With green and sustainable development as the core, SF has effectively applied the low-carbon concept to its operation practice, continuouslystrengthened its environmental management system, and vigorously promoted diversified low-carbon transportation scenarios. SF is committed torealizing green management covering the whole life cycle of logistics, actively building sustainable logistics, laying a solid foundation for building asustainable logistics system, and realizing the harmonious development of corporate value growth and environmental protection.Green Ground TransportationGround transportation is one of the key carbon emission segments in SF’s logistics operations. the Company focuses on promoting the comprehensivedevelopment of green ground transportation. By increasing the investment in new energy logistics vehicles, optimizing the selection of fuel logisticsvehicles, establishing an intelligent monitoring platform to track the real-time energy consumption of vehicles, and applying advanced logisticstechnology to optimize transportation routes, SF strives to reduce air pollution and greenhouse gas emissions in the process of ground transportation.Optimizing Structure of Transportation CapacityOptimizing the structure of transportation capacity is one of the crucial measures for achieving green, efficient, and sustainable development in thelogistics transportation industry. As the industry leader, SF expanded the green vehicle fleet through multiple approaches such as self-owned andleased, to phase out traditional fuel-powered transport vehicles. In 2023, more than 5,000 additional new-energy powered vehicles were put intooperation, covering scenarios such as short-haul feeder routes, feeder and end-of-line collection and delivery within cities, as well as primary andsecondary trunk routes across provinces and cities. By the end of the Reporting Period, over 31,000 new energy vehicles have been placed in service,with a service coverage of 243 cities.
Additionally, SF continues to explore thewider deployment of renewable energyvehicles. After taking into account thematurity of new energy vehicle technologyand refueling conditions, as well as theapplicability and feasibility in practicaloperations, the Company has initiated pilotoperations of LNG and hydrogen vehicles incertain regions and routes. In 2023, a total of11 hydrogen-powered light duty trucks hadbeen put into operation in Shanghai and twoLNG tractors in Beijing.
11,354
17,053
21,278
26,189
31,750
40,00030,00020,00010,000
7,049
Number of SF’s Self-owned andLeased New-energy Powered Vehicles from 2018 to 2023201820192020202120222023
Service coverage extends to 243 citiesA total of 31,750 new energy vehicles havebeen placed in service
Environment
2023 S.F. HOLDING SUSTAINABILITY REPORT
Replacing Fuel VehiclesReplacing fuel vehicles in ground transportation scenarios is a crucial part of promoting energy transformation and plays a vital role in reducing airpollutants and greenhouse gas emissions. In 2023, SF continued to optimize and replace traditional fuel vehicles. Methods such as increasing loadingcapacity, replacing high-axle count vehicles and phasing out vehicles with high energy consumption, were adopted to comprehensively improve thefuel efficiency and to significantly reduce the negative environmental impact of exhaust emissions from fuel vehicles. In 2023, more than 2,000 fuelvehicles were replaced or decommissioned by the Company.
Monitoring Energy Consumption DataIn order to accurately assess and manage the energy consumptionefficiency of new energy vehicles, SF has introduced a new energyvehicle system management platform to monitor their daily operationdata in real time. This platform performs visualized data analysis onfactors such as vehicle mileage, driving duration, charging duration,as well as the distribution of usage and charging periods. This enablestargeted optimization of energy management strategies for newenergy vehicles to improve the efficiency of their operation and energyconsumption.In addition, to further meet the charging demand of new energyvehicles, SF has been developing and optimizing the self-ownedcharging platform. In 2023, SF integrated internal charging pilesresources and actively cooperated with third-party charging pilesproviders. With the resources from multiple channels, the features ofthe platform were continuously optimized and updated, expand theinterconnectivity of more third-party service providers, and effectivelyobtain charging energy data for new energy vehicles while providingmore convenient and efficient charging services for SF’s new energyvehicles.
Third-partyplatforms
Third-partycharging piles
New energyvehicles of SF
SF platform
Chargingrecords
Chargingrecords
On-site
chargingChargingoperationson App
Interoperability
of Charging
Platforms
Adopting the strategy of“replacing small vehicles withlarger ones”, where vehiclemodels with insufficientloading capacity are replacedand eliminated, to reduce thefrequency of deploymentsand improve the efficiency oftransport. capacity input byincreasing loading capacity.
Gradually replacing high-axlecount vehicle models with low-axle count ones to reduceunnecessary fuel consumption,as the latter performs better interms of fuel savings.
For models with high fuelconsumption, managementapproaches such as fuelconsumption calibrationand speed ratio adjustmentare employed to lower fuelconsumption Models withfailure in improvement areeliminated to ensure an overallimprovement in fleet fuelefficiency.
Strictly in accordance withnational and local requirements,implement the "National StageVI Motor Vehicle PollutantEmission" vehicle emissionstandards, and take the initiativeto dispose of fuel vehicles withsubstandard emissions.
Phase-out of models withinsufficient loading capacity
Replacement of high-axlecount vehicles
Precisely managingfuel efficiency
Strict implementation ofvehicle emission standards
Environment
2023 S.F. HOLDING SUSTAINABILITY REPORT
Controlling Vehicle Fuel ConsumptionTo effectively control the fuel consumption of transport vehicles,SF adopted a two-pronged approach of empowering managementand implementing measures to strengthen control over and furtherreduce fuel consumption of the fuel vehicle fleet. From the perspectiveof management measures, SF has formulated the Lump-sum OilConsumption Plan for Commercial Vehicles. The plan determines thescientific fuel consumption standards in light of different businessscenarios, sets fuel consumption targets, and specifies fuel consumptionreward and punishment rules, in order to achieve efficient use of fueland effective control over transportation costs.To ensure the effective implementation of fuel consumptionmanagement measures, SF irregularly rectifies instances of abnormallyhigh fuel consumption in vehicles. By launching and optimizing theintelligent fuel consumption management platform, we also conductprecise and comprehensive management from aspects includingmonitoring energy consumption in real time and overseeing the drivingbehaviors. In addition, SF regularly carries out training related to fuelconsumption control and energy saving and emission reduction fordrivers, launched a course on fuel consumption control for self-ownedvehicles, and carried out special training on fuel consumption control forthe actual situation in different regions in order to raise awareness offuel conservation amongst drivers.
Driving behavior modelling
Supported by the Company’s data technology, weestablished a driving behavior database, whichincludes idling speed, over speed and many otherfactors, achieving a breakthrough in developing afuel consumption management tool from scratch.
Analysis tools for energy consumptionWe made in-depth analysis on factors includingroutes, vehicle models, axle count and emissionstandards, providing strong support for optimizingfuel consumption control.
Management and training empowerment
In the Company’s internal regular meetings,exemplary management methods related to vehiclereplacement, job rotation, and parking are sharedto constantly improve fuel consumption controlmeasures. In some key regions, supportive measuresfor fuel consumption management have beenimplemented, successfully reducing fuel consumptionby 1% to 5%.
Optimizing Transportation Routes
In the ground transportation, SF provides optimal paths through intelligent algorithms, in combination with factors such as express delivery timelinessand distance. During transportation, SF has pre-transit planning alerts, in-transit automated alerts and interventions, as well as post-transit tidalanalysis and time-out handling. These measures enable the early identification of congested road stretches and comprehensive optimization oftransportation routes, ensuring improvement of transportation timeliness. SF also deploys data analysis and deep learning technology to accuratelymatch freight routes and capacity resources to ensure the best combination of vehicles and goods, thus significantly improving overall transportationefficiency.Green AviationSF Airlines actively implements the concept of “double control” (i.e. controlling the total amount and intensity of energy consumption) and steadilypromotes the construction of green aviation. By establishing the energy management structure of SF Airlines, continuously optimizing the energymanagement system, and promoting the energy saving and emission reduction efforts of the air transport module, SF Airlines has penetrated energyconservation and carbon reduction into every aspect of flight operations.
Energy Conservation and Emission Reduction LeadingGroup and Management Committee? Guide the work of the Energy Management Taskforce;? Review and assess the work plans and measures proposed
by the Energy Management Taskforce.
Energy Management Taskforce
? Conduct statistical analysis on aviation kerosene, gasoline,
diesel, gas, water, electricity, and other energy data;? Formulate specific energy management work plans and
measures;? Advance the implementation of energy management work
plans and measures;? Regularly report the project progress to the Leading Group.
SF’s Airlines Energy Management Structure
Environment
2023 S.F. HOLDING SUSTAINABILITY REPORT
International Routes RedispatchUnder the premise of ensuring flight safety, SF Airlinescan precisely reduce the amount of fuel for take-off byimplementing a redispatch strategy on international routes,thereby increasing the business payload of the flight. In2023, SF Airlines saved about3,292 tons of aviation
fuel and reduced carbon dioxide emissions by9,981tCO
e through redispatch.
Straight Route Selection
Route optimization allows the reduction of unnecessarydetours and turns. This shortens the flight distance andreduces fuel consumption. In 2023, SF Airlines savedabout1,183 tons of aviation fuel and reducedcarbon dioxide emissions by approximately3,587tCO
e through straight route selection.
Furthermore, in order to ensure the authenticity and reliability of carbon emission data and meet the carbon emission monitoring requirementsof regulatory authorities, SF Airlines invites a third-party verification agency to verify GHS emission data annually and issue a verification reportaccordingly. In 2023, SF Airlines passed the annual carbon emission verification of the Ministry of Ecology and Environment and also completedthe annual ISO 50001 Energy Management System certification. Additionally, the Company has actively carried out environmental internal auditsand prepared the SF Airlines Energy Conservation Self-Inspection Report, fully showcasing SF’s efforts and achievements in energy conservation andemission reduction in aviation transportation.In 2023, SF Airlines continued to prioritize low energy consumption and sustainable operations as its core objectives. By optimizing the mix of aircraftmodels, applying fuel-saving technologies, managing aviation fuel, optimizing ground fleets, and other means, the company actively explored andpracticed green aviation, improved energy and fuel utilization efficiency, reduced emissions of greenhouse gases and other pollutants, and minimizedthe environmental impact of its business operations.Optimizing the aircraft model mix
SF is committed to building a low-energy, high-efficiency “green fleet” and actively introducing large cargo aircraft such as the 747 and 767, whilegradually increasing the proportion of wide-body cargo aircraft. Compared to the traditional 737 models, the newly introduced large cargo aircraftexhibit higher carbon emission efficiency and lower fuel consumption per ton of payload under full load conditions. As of the end of 2023, SF had atotal of 86 owned cargo aircraft.
20192020202120222023
0%10%20%30%40%50%60%70%80%90%100%
737747757767
The proportion of self-owned large aircrafts of SF
increased year by year from 2019 to 2023
Applying fuel-saving technology
SF Airlines continues to explore and optimize fuel-saving technologies in the aviation transportation sector, actively applying a series of innovativefuel-saving measures, including optimizing flight altitude levels, refining payload management, dynamic allocation of aircraft models based on payloadforecast, redispatch
, straight route selection and APU shutdown to reduce fuel consumption.
Under the premise of ensuring the safe and normal operation of flights, SF Airlines rationally utilizes international route fuel policies and implements redispatch strategiesfor flights to reduce aircraft refueling and lower fuel consumption.
Environment
2023 S.F. HOLDING SUSTAINABILITY REPORT
Aviation fuel management monitoring systemSF Airlines continues to improve its online fuel management system. By setting scientific oil-saving procedures, SF Airlines monitors and managesthe fuel consumption of each flight in real time so as to improve fuel efficiency. After four years of development efforts and continuous updates, avariety of fuel-saving indicators including straight route selection, redispatch and others have been fully integrated into the fuel management system,realizing the tracking and monitoring of fuel data throughout the whole process.Upgrading fuel-saving incentivesTo encourage pilots and dispatchers to actively adopt energy-saving and emission-reduction measures while ensuring safety, SF Airlines hasestablished a flight landing fuel residual assessment system. SF Airlines has developed an evaluation system for pilots and dispatchers’ landing fuelresidual indicators in the fuel management system. Quarterly statistics and analysis are conducted on the fuel savings and ranking data of pilots anddispatchers, and rewards are issued to those who excel in controlling landing fuel residuals. This approach aims to more accurately measure andincentivize energy-saving performance, achieving the desired effects of energy conservation and emission reduction.Optimizing ground fleetTo fulfill the objective of “striving to achieve 100% electrification of vehicle equipment at aviation bases by 2030”, SF is progressively replacingdiesel and gasoline vehicles and equipment at airfield bases with new energy vehicles. This initiative includes the deployment of special-purpose newenergy vehicles such as conveyor-belt loaders, lifting platform vehicles, and tractors, thereby advancing the electrification of vehicles at aviation bases.In 2023, SF continued its efforts to acquire new energy vehicles at various aviation bases to further increase the electrification rate of its vehicleequipment.
The progress of vehicle electrification at various aviation bases in 2023
Striving to achieve
100%electrification of vehicle
equipment at aviationbases by 2030
The electrification rate of thevehicle equipment reached
55.8%
The electrification rate of thevehicle equipment reached
27.45%
The electrification rate of thevehicle equipment reached16%
The electrification rate of thevehicle equipment reached
15.2%
Ezhou BaseShenzhenHeadquartersHangzhou
Base
Beijing
Base
Strict prevention and control of pollutionSF Airlines is committed to implementing strict pollutant emission control in air transportation business scenarios. For waste fuel generated duringaircraft maintenance, SF Airlines has formulated and implemented internal operational management standards, clarifying the disposal requirementsfor various fuels, such as waste fuel, hydraulic oil, and lubricating oil. In terms of noise control, SF Airlines has implemented various noise abatementmeasures and has optimized departure procedures and cargo aircraft departure strategies. Additionally, SF Airlines actively engages in regular airfieldnoise monitoring, which further enhances the efforts to mitigate the impact of aircraft noise on the surrounding environment.
Environment
2023 S.F. HOLDING SUSTAINABILITY REPORT
Building Green Industrial ParksSF is actively building green and low-carbon industrial parks, promoting green operations in various aspects such as planning and design, warehouseconstruction, and operational management, based on green infrastructure construction and carbon reduction technological innovation. Throughvarious measures such as installing rooftop photovoltaics, introducing intelligent water and electricity management, and optimizing warehousespace layout, SF comprehensively improves the efficiency and energy-saving benefits of the transfer process, reducing the environmental impact ofthe transfer process. that are environment-friendly, energy-efficient, and operate with a green ethos. In 2023, SF’s industrial parks in Changsha andFoshan obtained the “Class I Green Warehouse” certification by the China Warehousing and Distribution Association (CWDA), while the Guizhouindustrial park received the “Green Logistics Park” certification issued by the Guizhou Federation of Logistics and Purchasing.
SF continuously increases the proportion of clean energy usage, actively plans for renewable energy generation projects, and advances the constructionprogress of photovoltaic projects in industrial parks. In 2023, SF established the Industrial Park PV Project Management Implementation System,clarifying the full-process management standards for photovoltaic projects from site selection to operation, including supplier access standards,photovoltaic project investment and construction standards, equipment and material quality standards, management standards during construction,and subsequent operational management requirements.
Green Warehouse Certification
(Changsha)
Green Warehouse Certification
(Foshan)
Provincial Green Logistics ParkCertification (Guizhou)
Operational efficiency improvement
In order to improve the operation and management efficiency of thepark, SF has built a property management system that integrateskey property modules such as environmental greening, securityand fire management, and maintenance and inspection of facilitiesand equipment, which has covered all the parks in operation andensures that the parks operate efficiently and safely as a whole.
Intelligent energy management
SF has established the Energy Consumption Management System forIndustrial Parks and installed intelligent water and electricity systemsto standardize the management of public energy consumptionin various parks, effectively improving the efficiency of resourceutilization in the parks. As of the end of 2023, the intelligent waterand electricity systems for industrial parks have been installed andoperated in five parks. Compared to 2022, the water and electricityconsumption in the public areas of the operational parks hasdecreased by 8.9% and 12%, respectively.In addition, SF actively promotes the construction of permeableconcrete technology and carries out rainwater collection workwithin the parks. The recovered rainwater is recycled and reused asgreening water, effectively improving the utilization rate of waterresources and saving water usage, and plays a good demonstrationrole in protecting the ecological environment.Installation of energy-saving equipment
SF continues to carry out the installation of new energy chargingpiles to meet the green travel needs of customers in the parks. Bythe end of the reporting period, 30 industrial parks had completedthe construction of new energy charging piles, with a total of morethan 280 charging devices installed and more than 500 chargingspaces provided.
By integrating institutional regulations and digital empowerment, the Company is continuously improving its environmental management capabilities,focusing on aspects such as operational efficiency improvement, intelligent energy management, and installation of energy-saving equipment.
Progress and Future Plans for PVProjects in Industrial ParksAs of the end of 2023, SF had successfully promoted theconstruction of 26 industrial park PV projects, of which 14industrial park PV projects have been put into operation, witha cumulative installed capacity of 64 MW, and an annual cleanenergy generation of 18.39 million kWh.SF will continue to promote the investment and construction of PVprojects in its industrial parks, with the aim of fully completing theconstruction and putting them into operation by the end of 2025.By then, the total installed capacity of photovoltaic equipment inthe parks will reach 140MW, and the annual power generation isexpected to exceed 100 million kWh.
Environment
2023 S.F. HOLDING SUSTAINABILITY REPORT
Sustainable Packaging R&DSF actively responds to the trend of green packaging, firmly implements the guidance of the “9917” Program for green development in the postalindustry, and continuously increases investment in the research and development of sustainable packaging materials, striving to make breakthroughsin green packaging technology, models, and application innovation. Guided by sustainability and intelligence, SF comprehensively promotes thereduction, recycling, harmlessness, and standardization of packaging, contributing to green logistics. At the same time, SF is committed to deepeningthe fine management of sustainable packaging and closely collaborating with upstream and downstream partners in the industry chain to jointlypromote the development of green packaging.
Packaging ReductionTo tackle the issue of excessive packaging in express delivery at its root, SF proactively drives innovation in packaging technology and curtailspackaging usage from a front-end reduction perspective, aiming to realize green packaging governance. At the management level, SF enhances theimplementation of the Packaging Operation Code of SF, conducts special campaigns on excessive packaging, and offers detailed operational guidelinesfor packaging various items to ensure the enforcement of green packaging standards. At the same time, the Company continues to enhance the SFIntelligent Packaging Service Platform, leveraging this platform to continually refine packaging solutions. The platform utilizes multimedia tools likevideos and images to offer couriers training in packaging techniques, instructing them on how to pack various items in a rational manner and preventexcessive packaging.In 2023, SF continued to center its efforts on the “Fengjing Plan”, innovating in R&D for the reduction, standardization, and contextualization of eightmajor material categories, including plastic bags, tape, stickers, and seals. By employing lightweight and reduction-oriented designs, the Companydecreased the consumption of plastics. Through packaging reduction measures, SF has cumulatively reduced the use of base paper by approximately43,000 tons and plastic by approximately 162,000 tons in 2023, resulting in a total reduction of carbon emissions of approximately 164,000 tons.Pursuing Packaging Reduction Without Quality Degradation: LightweightDocument Waterproof Bags Replace Traditional Plastic Bags
Recyclable Packaging
Based on different business scenarios, SF continuously explores and develops recyclable packagingcontainers that are suitable for various scenarios and possess comprehensive functionalities. This enablesthe standardization of container and carrier applications, successfully reducing product damage rates,shortening operation times, and effectively cutting operational costs. In 2023, SF actively pushed forwardthe innovative research and development of recyclable packaging containers, developing a series ofpackaging suitable for 19 different scenarios. This not only enhances the efficiency of the company’sinternal operational infrastructure but also provides customers with superior and convenient recyclingpackaging solutions.SF has widely used recycled woven bags to replace disposable woven bags in transit. By considering thedemand for bags in different regions and allocating the bags based on their existing usage, the Companyensures the effective recycling of woven bags. As of the end of the reporting period, the average numberof times each recycled bag has been used has exceeded 24 times. In 2023, the Company invested anadditional 23 million recycled bags to further promote the recycling of recycled bags.
SF Recyclable Woven Bag
SF Lightweight Document Waterproof Bag
During the rainy season, to shield documents and tickets from raindamage, couriers frequently place an extra standard plastic bag over thedocument envelope, this extra usage accounting for about 4.5% of theoverall use of document envelopes. In order to reduce the consumptionof materials in this scenario, SF has introduced a specialized waterproofbag for documents as an alternative, which reduces the thickness by40%, simplifies the manufacturing process, optimizes from three-layerco-extruded film to a single-layer co-extruded film, and avoids the needfor printing to be more environmentally friendly.In 2023, SF’s entire network applied for the use of these lightweightdocument-specific waterproof bags approximately 2.55 million. Thismove led to a decrease in plastic consumption of around 19 tons and areduction in carbon emissions of approximately 67 tons.
Environment
2023 S.F. HOLDING SUSTAINABILITY REPORT
Additionally, SF has developed and implemented recyclable packaging solutions including medical precision temperature-controlled boxes, cold chainEPP recyclable insulated boxes, and standard recyclable pallet boxes for large items, all tailored to meet the diverse requirements of customers acrossvarious industries and scenarios for circular packaging. In 2023, SF’s recyclable packaging initiatives contributed to a total carbon emission reductionof approximately 377,000 tons.
Pharmaceutical Transportation Scenarios –Pharmaceutical Temperature-controlled Recyclable BoxThis box uses a design for recyclable temperature-controlledpackaging, effectively replacing disposable foam boxes.Through ongoing improvements and optimizations ofmaterials, the number of times packaging boxes can bereused has been significantly increased. Compared totraditional foam boxes, each use of a pharmaceuticaltemperature-controlled recyclable box can reduce carbonemissions by 207g.
Cold Chain Transportation Scenarios – Cold Chain EPP
Recyclable Insulated BoxCompared to traditional white foam boxes, the EPP recyclableinsulated box is lightweight, pressure-resistant, non-toxic,and environmentally friendly, providing a safer and moreeco-friendly solution for cold chain logistics. In 2023, SFpiloted about 4,000 recyclable insulated box in cold chaintransportation scenarios, accumulating more than 20,000 timesof recycling and reducing carbon emissions by about 5 tons.
Bulk Transportation Scenarios? Recyclable Pallet Box: made of PP/PE materials(100% recyclable), they exhibit strong compressiveand impact resistance. The absence of nails reducesthe risk of workplace injuries and effectively decreasesthe dependence on traditional wooden frames, woodenboxes, and wooden pallets for large and irregularindustrial items. As of the end of the reporting period,over 30,000 recyclable pallet boxes have been deployed,with a cumulative reuse rate exceeding 170,000 times;? Recyclable Honeycomb Panels: primarily made of PP
material (about 97% recyclable), they exhibit strongimpact resistance and can be used as a substitute forair cushions or honeycomb cardboard in televisionprotection. As of the end of the reporting period,approximately 11,000 reusable honeycomb panels havebeen deployed, with a cumulative reuse rate exceeding54,000 times.
“π-Box” Recyclable Box
Theπ-Box carbon-neutral recyclable box is a reusableouter packaging box independently developed by SF.It is made of environmentally friendly PP material that isharmless to humans and the environment, with 97% of thebox being recyclable. It eliminates the need for consumablematerials such as adhesive tape and zippers. As of theend of December 2023, over 1.29 million π-Box recyclablepackaging boxes have been deployed, covering 119 cities,with a cumulative reuse rate exceeding 20.64 million times.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Setting the Industry Standards: SF’s packaging laboratory was honored
with the 2022 China Standards Innovation and Contribution Award
Bio-degradable PackagingSF has actively carried out research and development work on biodegradable packaging materials, collaborating with external research institutionsand universities in a series of cooperative studies to continuously expand and deepen its knowledge reserve in the field of cutting-edge biodegradablepackaging technology. As of the end of 2023, SF has cumulatively deployed hundreds of millions of biodegradable packaging “Feng Bag” in regionsincluding Beijing, Hainan, Guangzhou, and northern Zhejiang.Meanwhile, SF has also conducted pilot projects for various types of biodegradable packaging materials to further verify the feasibility ofbiodegradable packaging materials in practical applications. In 2023, SF completed the development and pilot testing of fully biodegradable wovenbags.Green Packaging StandardsEmpowering the green transformation of express packaging, setting industry standards for green packaging, and thoroughly refining the greenpackaging system across the industry chain are of vital importance. As an industry leader, SF actively engages in the development of national andindustry standards concerning express packaging. In 2023, SF took the lead in drafting the national standard Requirements of Restricting ExcessivePackage in the Express and played a pivotal role in the creation of several industry standards, including the Technical and Management Specificationsfor Green Packaging in E-commerce.
SF’s packaging laboratory obtained the China Standards
Innovation and Contribution AwardSF not only actively supports the development of green packaging standards but also enhances theinspection of packaging materials for logistics, the safety validation and assessment of packagingsolutions, and the innovative research into packaging standards by establishing a packaging laboratorytesting center. SF’s packaging laboratory testing center boasts comprehensive testing capabilities,encompassing 45 packaging categories, more than 140 testing standards, and the capacity to test 400items. With these efforts, SF has successfully earned the designation of Green Packaging TechnologyResearch and Development Center in the postal industry, it is one of the first to do so within the industry.Additionally, the Company has obtained ISTA certification (International Safe Transit Association) andCNAS (China National Accreditation Service for Conformity Assessment) certification, offering robustsupport for the green transformation of the industry.In 2023, SF’s packaging laboratory once again passed the review and expansion of CNAS accreditation,and its CNAS-accredited testing capabilities were increased from 22 to 66 items. Additionally, thelaboratory conducted a comparison of testing capabilities with nine external third-party testing institutions,with consistent results, fully validating the consistency and reliability of SF packaging laboratory’s testingmethods compared to external testing institutions.
CNAS Certificate
In 2023, SF’s packaging laboratory, in partnership with severalinstitutions, contributed to the formulation of the national standard GB/T 37422 – 2019 Method and Criteria for Green Packaging Assessmentwhich was awarded the Second Prize of 2022 China StandardsInnovation Contribution Award. This standard adopts a “wholelifecycle” approach to packaging, encompassing aspects such as design,production, usage, and recycling. It establishes a comprehensive,practical, and broadly applicable green packaging evaluation indexsystem, addressing a void in green evaluation standards within China’spackaging industry.China Standards Innovation and Contribution Award, as the highesthonor in the field of standardization in China, aiming to recognizeorganizations and individuals who have made outstanding contributionsto standardization activities. SF’s packaging laboratory received thisaward signifies that its work in green packaging standardization hasreached a leading position in China.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Promoting Circular EconomySF is committed to collaborating with the upstream and downstream sectors of the industry chain to establish a recycled packagingsystem, and is committed to raising the public awareness of environmental protection, in order to promote the development of therecycling economy, to build and share a “zero waste city”, and to contribute to the realization of a green and sustainable future.Recycling Express PackagesPromoting the recycling of express packages is one key measures of SF to realize sustainable logistics and the “zero-waste city”. The Group is activelyengaged in building a circular ecosystem for express packages, integrating internal and external resources to promote the verification and practiceof a closed-loop chain from developing industry standards, conducting technological research, to the realization of express packages recycling Wealso optimizes the use of plastic recycling approaches, and works with upstream and downstream enterprises to explore a new model of reasonablereuse of recycled plastics, in order to lay a solid foundation for building a complete system of “plastic packaging design – production – consumption –recycling -regeneration – High-value application”.
In 2023, SF continued to improve the closed-loop model of recycling and regeneration of express bags,and completed the technological innovation and implementation of “Double Easy” (easy to recycle, easy toregenerate) bags through close linkage with internal business lines and in-depth cooperation with upstreamand downstream enterprises. In the field of front-end technology research, SF has completed the researchand development of the regeneration formula and products of “Double Easy” plastic bags, adding up to 30%of regeneration resin (PCR) while maintaining excellent mechanical properties, in line with the requirementsof the national standard for courier bags, and realising the value of a single material that is easy to recycle. Ithas won the certificate of excellent rating of “Plastic Products Easy Recycling Design Certification” issued bya third-party authoritative organisation, which fully demonstrates the company’s leading ability in building aninnovative circular economy model.
Plastic Products Easy RecyclingDesign Certification
Express Easy Recycling, Easy Regenerating Recycling System
FormulaRaw material
supply
Providing technical supportfor the formula designof recyclable packagingmaterialsThe regeneration
formula
Film blowing andbag manufacturing
The usage
Wastecollection
Consumers
Providing PE materialwith traceable qualityand origin
Community
dropRecycling, cleaning and pelletizingProviding resource utilizationof the recycled materials
GRPGDouble E markFilm blowing,printing andbag manufacturing
Terminal expressoutlets/stationsTransportation
The last mile
deliveryWaste reallocation
Discarded plastic films
Recycling and
pelletizing
Manufacturers ofplastic products
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2023 S.F. HOLDING SUSTAINABILITY REPORT
The Recycling Poster
User end: over880,000 Double E bags have been
dispensed in Shanghai. In 2024, the Group anticipates expandingthe application in seven major regions, reducing carbon emissionsby approximately 1,000 tons per year compared to conventionalpolyethylene (PE) bags. This will reduce carbon emissions byapproximately1,000 tons per year compared to conventionalPE bags.Recycling end: the terminal recycling points in Shanghai have increased to 35 this year, covering various places such as schools and servicestations. SF puts up posters at various recycling points to disseminate the concept of “zero waste”. As of the end of the reporting period, thetotal amount of recycling reached over
1.1 tons. SF plans to increase the terminal recycling points by 30%, and strives to amplify
the total amount of recycling by more than40%.
SF’s Double E Courier Bags
The Recycling Point
The first industry-wide closed-loop recycling pilot project for plastic packaging waste was officially launched in Shanghai in 2023. With efforts fromthe up and down stream industrial partners, the project aims to collect and pelletize discarded courier wastes and manufactures high-performanceproducts through technological innovation. We facilitated a closed-loop recycling system, breaking away from the traditional linear mode of“production – usage – disposal” to establish a circular business model from courier bags to courier bags, and minimize the environmental impact ofexpress wastes.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Building a green carbon energyplatform to promote a new modelof sustainable consumptionSF keeps developing agreen energy platform topromote carbon reductionamong consumers. Withthis platform, SF encouragessustainable consumption byestablishing a holistic closedloop of “promoting low-carbon services – using low-carbon services – rewardinggreen energy – redeemingpoints”. To motivate moreconsumers to choose low-carbon services, SF exploresvarious scenarios of low-carbon services, includingcircular package, SF Rush,electronic proof of delivery,photo uploading, EPPtemperature control boxesand the special urgentdelivery services. Consumerswill be rewarded with “greenenergy” that can be furtherredeemed for gifts andvouchers after selecting and adopting these low-carbon services. Bydoing so, we improve the satisfaction of consumers toward servicesof SF green logistics, and foster a collaborative effort with users tocreate a low-carbon lifestyle.
SF Launched the Public WelfareVideo – “Zero Carbon Future” toMotivate Individuals to Take SmallSteps towards Reducing TheirCarbon Footprint
To better disseminate theconcept of zero carbon tothe public, employees andbusiness partners, SF filmedits public welfare video –“Zero Carbon Future”. Theadvertisement has beenreleased both internally andpublicly, with a current totalonline view counts surpassing10,000. On December 5,2023, the InternationalVolunteer Day, SF held thepremiere of the SF publicwelfare advertisementwith a theme on forestconservation - “Zero CarbonFuture” - in Nanshan district,Shenzhen. Avid tree plantersshared their experienceswith approximately 100participants in this event.Consequently, we aroseawareness of employeesand volunteers aboutenvironmental protection,evoked profound reflection on environmental protection andinspired them to take small actions to reduce carbon emissions.
Promoting Public Environmental AwarenessSF is committed to improving the public consciousness and awareness of environmental protection by varied means. By doing so, we aim to inspirethe public to actively engage in environmental actions and jointly promote sustainable development and build a Zero Carbon Future.
SF Green Carbon Energy Platformfor Carbon Reduction
The Premiere of The PublicWelfare Video – “Zero Carbon
Future”
“Go Green Together” – Exploring a Green and Sustainable Future
SF continues to carry out the “Go Green Together” program, aimingto encourage public participation in the reuse of idle express cartonsthrough DIY transformations.2023 is the fourth year of this program. SF used express cartons asvases for green plants and called on everyone to do so. We also connectwith “plant recycling in the community” organisations to create offlineflash activity called “planting garden”, attracting people to experiencecardboard box planting, and convey the environmental protectionconcept of the plan.SF also cooperated with an international maternal and baby brandto launch a themed parent-child activity called “Green ’Box’Companionship for Baby’s Growth”. The host prepared planting cartonsdesigned by SF and the maternal and baby brand, and encouragedeveryone to transform cartons into vases through DIY, which promotes the concept of recycling and transforming waste into treasures to children.
The DIY Planting Carton
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2023 S.F. HOLDING SUSTAINABILITY REPORT
SF Forest in Seda, SichuanIn July 2023, SF launched “SF carbon-neutral forest in Seda, Sichuan”.We ensured the health of plants and the ecological benefits atmaximum by selecting plants adaptive for local climate and followingscientific planting and maintaining methods. SF planted 514,530 sprucetrees in the Dema village of Ranchong town in Seda county, SichuanProvince this year, covering 741 acres. Additionally, SF cares the localcommunity, and ensures residents’ basic living by provide regularprovisions of subsistence to the woods rangers, children and the elderly.
SF Carbon-Neutral Forest Planting
Protecting the EnvironmentSF shoulders the responsibility of protecting environment, and exercises various environmental protection initiatives to minimize theinfluence of its operation on the environment and biodiversity. This commitment aims to conserve natural resources and make theworld a better place.SF ForestTo realize carbon reduction goals and promote sustainable development, SF continues to implement its carbon-neutral program – the SF Forest –Carbon Neutral Project (the SF Forest in short). We fulfil our commitment to protect the environment by real actions. Based on the online app “SFForest” and the carbon-neutral woods, the program advocates the “zero carbon” concept to the volunteers, employees and clients to encourageactive participation through multiple channels including the public welfare advertisement.The Carbon-Neutral ForestWith scientific planning and meticulous implementation, the SF Forest program effectively offsets the GHG emissions while protecting biodiversity andmaintaining the stability of the ecosystem. With these efforts, SF contributes to creating a healthy and resilient ecological environment. Since 2019,the program has been engaged in multiple strategic cooperations with the China Green Carbon Foundation concerning climate change and ecologicalprotection and restoration. During the year, SF actively promoted ecological conservation by implementing the forest plantation programs in Laiyuan,Hebei Province and Seda, Sichuan Province.
As of the end of 2023, SF together with its enterprises and employees, had planted carbon-neutral forest spanning over 823.5 acreswith a cumulative total of more than600,000 trees, which will absorb estimated over 110,000 tons of carbon dioxide inthe atmosphere during their future growth. thus making a positive contribution to the mitigation of global warming.In 2023, the SF Forest was listed in the “China Public Welfare Brand Project List” by Southern Weekend.
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As of the end of 2023, the app hadattracted more than80,000individual users. Together, they adoptedover70,000 trees and made overRMB500,000 of donations.
In 2023, a total of37,837 tree
saplings were adopted, an increase of85% compared to 2022. Saplingswere planted in the field after maturing,contributing to a greener Earth.
Online App – The SF ForestAs a champion for the green andenvironmentally friendly concept, SFencourages voluntary in low-carbon activitiesand provides diversified approaches topublic welfare. SF integrates IT with greenphilosophy by developing an online app called“the SF Forest”, bringing users a brand-newinteractive experience. The users can easilyacquire information such as the plantingand growth of forests and the fruit of theenvironmental protection through “theonline tree planting”. The app also featuresa variety of interactive functions, such asmeasuring carbon emissions, adopting andraising saplings, etc., and motivates users toparticipate through a task reward mechanism.
The SH Forest Online APP
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Green Office
SF has established internal systems such as “Office Space Management Measures” and “Water and Electricity ManagementMeasures” to actively integrate green development into daily operation with an emphasis on the scientific and reasonable use ofresources and emissions and at the same time, encouraging its employees to practice low-carbon behaviours, and continuouslyimproving their awareness of environmental protection, so as to jointly create a green and environmentally friendly officeenvironment and build a resource and energy-saving enterprise.Energy ManagementEnergy management is an essential issue of the sustainable development of a company. To build a green and low-carbon environment, SF activelypushes forward a series of energy management measures.
? For energy saving, SF has replaced some of streetlamps into solar-powered ones, and regularly turned off the light whileensuring illumination.? SF has replaced some of the porch lights in its structure into discontinuous infrared body sensor activated lights designed
with two sets of switches. To manage energy consumption, one switch is remained permanently on and is connected tothe infrared body sensor activated light, while the other is under manual control, allowing for flexible selection of switchingtime. This energy-saving initiative has been proven successful in the first phase of the complex building in Ma’anshanindustrial park, where 0.672 kwh were saved for each floor per day.? As part of the energy-saving renovation at the headquarters, SF upgraded lights and displays, resulting in electricity savingof over 13,000 kwh per month.Energy-SavingRenovation
? SF has developed a comprehensive energy monitoring and management mechanism. By installing energy meters that enable
real-time monitoring and data analysis of electricity and water consumption in offices, SF works out improvement measuresafter timely identifying waste and its cause.EnergyMonitoring
? SF reduces energy consumption by introducing energy-saving office equipment such as computers and printers, and reasonably
deploying devices to decrease machine standby and idle time.? To avoid electricity waste and prevent safety risks, SF requires turning off the power of devices when they are not in use for an
extended period, after being charged or during off-work hours.ElectricityConsumptionof OfficeEquipment
Waste Management
SF strictly manages wastes in operations. The Group strives to reduce the negative impact on environment by measures such as waste sorting andresources recycling. SF has developed and implemented an internal waste sorting policy. We actively implement relevant measures in offices andmanufacturing sites. Distinct marks for waste sorting and specific treatment processes have been set up for various types of waste.
General wasteRecyclable wasteHazardous wasteGeneral waste such as domestic waste,obsolete office supplies, waste plasticbags, waste folders, paper scraps,rags and waste gloves firstly shouldbe sorted out. Afterwards, they aretransported to designated places andhandled by the sanitation department.The disposal process should be dulyrecorded for better management andcontrol.
Recyclable waste such as waste paper,paper products and cardboard shouldbe centrally collected and sent to thedesignated locations. Then personnelin charge should contact qualifiedcontractors for on-site recycling basedon the condition of the waste, thusmaking the best use of it.
Hazardous waste such as obsoletelamps, batteries, printer ribbons andtoner cartridges should be collected bySF in a centralized manner and handedover to a certified third party forrecycling.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Additionally, SF continuously conducts trainings on waste sorting for employees, aiming atcomprehensively improving their awareness and capability of garbage sorting. The training coversevery aspect in waste sorting, such as basic knowledge, practical operation skills, relevant laws andregulations as well as policy requirements.Exhaust & Noise ManagementTo comply with the relevant regulations and to minimize the impact on the surrounding environmentin the course of operations, SF actively identifies, assesses and manages exhaust and noise.Regarding noise control, SF employs the soundproof glass and upgrades some devices to further isolateand reduce noise. In terms of exhaust emission management, SF strictly implements vehicle admissionstandards in accordance with national requirements.All purchased vehicles must meet environmental emission standards and undergo annual inspectionsfor compliance with exhaust emission standards. This proactive approach effectively minimizespollutant emissions into the air.Water Resources ManagementSF regulates water consumption by formulating water management systems such as “Water and Electricity Management Measures”, controlling theamount of water consumption and improving the efficiency of water resources use. The company strengthens the maintenance of water equipmentto reduce the waste of water, and also actively carries out water conservation publicity to enhance employees’ awareness of water conservation andachieve water conservation. The Company’s sources of water are all municipal water, and it does not involve the use of large quantities of water orthe discharge of wastewater in the course of its operations, nor does it engage in products and businesses that are prone to cause pollution to waterresources.Effective water conservation measures implemented by SF include:
SF’s Publicity posters on waste separation
SF carries out regulardevice inspections,timely detections andrepairs of the leakageissue to ensure allwater equipment isin sound operatingcondition and avoidunnecessary water losssuch as water leakageand overflow.
SF continues tooptimize the efficiencyof greening wateruse by adjusting theirrigation pattern,transitioning fromexcessive waterirrigation to moresustainable methodswith the adoption ofwater-saving irrigationtechnologies.
Outdoor rainwaterreuse ponds are set upin industrial parks forirrigating green area,cleaning garages androads, to reduce theuse of tap water.
Elaborately designedwater-saving logos areposted at all waterpoints with contentregularly updatedaiming to raiseemployees’ awarenessof water conservationand guide them todevelop good waterusage habits.
SOCIETY
Theme: Building Specialized AgriculturalProduct Value Chains to Support RuralRevitalization and DevelopmentEmpowering the Talent TeamBuilding the Line of SafetyBuilding Responsible Chain TogetherShouldering Social Responsibility
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SF actively responds to the national strategies of rural revitalization and common prosperity. As a leading integrated logisticsservice provider in China, the Company has always adhered to the core concept of “racing against time” and deeply cultivated thefield of agricultural product delivery. Countless SF couriers are stationed in the first-mile of the place of origin, helping to realizethe business model of agricultural products from “field” to “taste buds”, winning the trust and praise of the vast number ofconsumers.Facilitating the Flows of Agricultural Products to Help Revitalize Rural Areas
In response to the promotion of “agriculture, rural areas, and farmers” work process,the Company focuses on the difficulties in the circulation field of agricultural products.To promote the upstream services of agricultural products and facilitate the leapfrogdevelopment of rural economies, SF, with the construction of the front end of logistics as itscore, scientifically allocates logistics capacity and lays collection points to injects new vitalityinto rural revitalization. Additionally, over the years, SF has actively explored the path ofbuilding regional agricultural brands by customizing brand packaging, establishing a completetraceability system, and organizing brand promotion activities, helping regional agriculturalproducts enhance their brand premium capabilities. The Company’s strategy of helpingfarmers is clear: not only to transport good agricultural products out, but also to “transport”the good agricultural brand out.The Company insists on building agricultural product collection points in the fields, investing in mobile sorting vehicles suitable for small batchsorting, and building fresh pre-processing centers close to the place of origin. For many fresh categories, the Company ensured product freshness andsafety through the design of exclusive packaging. During the harvest season of characteristic agricultural products, the Company integrates varioustransportation resources such as aviation, high-speed rail, and cold chain to ensure that agricultural products are efficiently and quickly delivered to allparts of the country. To ensure the quality of service throughout the process, a special project team is set up during the “fresh season”, with the helpof data technology and visualization system, to monitor and warn each link of collection, transfer, transportation, delivery, and after-sales in real time.The Company’s strong logistics network, advanced packaging technology, and fast delivery capabilities have overcome one after another high-difficulty transportation of fresh categories, assisting in the express transportation of products such as hairy crabs, live fish, seafood, beef and mutton,lychees, cherries, bayberries, strawberries, and matsutake, to achieve the direct delivery and direct arrival mode of agricultural products nationwide.
Theme
Building Specialized Agricultural ProductValue Chains to Support Rural Revitalizationand Development
SF’s service network for delivering agricultural products
44,000 tons
11,000 tons
2.20 million shipments
Dried fruits in XinjiangXinjiang fresh fruitsXinjiang medicinal herbsTibetan cordyceps sinensis
Shaanxi fresh datesShaanxi kiwifruitGansu wolfberryGansu applesGansu beef and muttonQinghai Golmud wolfberry
Inner Mongolia beef and muttonBeijing juicy peachNingxia beef and muttonNingxia wolfberryNingxia fresh dates
Shanxi appleSichuan orangeSichuan pomegranateSichuan cordyceps sinensisYunnan matsutake mushroomsYunnan coffee
Guangxi dragon fruitGuangxi orangeHainan mangoWest Guangdong longanWest Guangdong lycheeWest Guangdong seafood
Hubei orangeHubei cray?sh
Anhui herbal medicineAnhui tea
Xianju waxberryFuzhou teaQuanzhou teaXiamen seafoodDongguan durianEast Guangdong pomeloSouth Jiangxi orange
Chagan Lake ?shJilin ginsengDonggang strawberryDalian cherryYantai cherryRushan oysterHairy crab (nationwide)Yangshan peach
In 2023, SF delivered about
4.58 million tons
of specialty agricultural products.
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Building a Sustainable Production-distribution Ecosystem to Promote RuralIndustry DevelopmentThe Company continues to promote the coordinated development of the upstream and downstream of the agricultural industry chain, focusing onfour aspects: refined services, support for production and sales, technology empowerment, and brand building. By building a nationwide servicenetwork for the upward movement of agricultural products, SF aims to increase farmers’ income, promote high-quality development of ruralindustries, and contribute to achieving common prosperity.
Map presenting SF’s services to support the upward movement of agricultural products
Refined services
SF has integrated internal resources including charterflights, cold chain logistics, warehouses, and other externalcollaborative resources to serve agricultural products withdifferent value hierarchies and time requirements. In doingso, the Company have formulated differentiatedoperation models and refined pricing strategiesto improve business efficiency and servea wider market of agricultural productswith more cost-effective services.
Brands buildingSF actively cooperated with localgovernments, rural cooperatives and otherinstitutions to build regional agriculturalproduct brands, promote brand construction.In 2023, SF also continued to invest RMB 3 millionto formulate a special fund subsidy mechanism for thecustomization of regional brand packaging materials andalso cooperated with local governments, obtained brandauthorization, designed brand packaging, and helped tojointly build 28 regional agricultural product brands.
Technology empowermentBased on the characteristics ofagricultural products, SF applied technology
tools such as fruit wrap, harvest, one-piece delivery and Fengsu in different businessscenarios, covering production, supply, transportation,operation and sales. These tools assisted farmers in waybillprinting, source tracing, marketing and financial settlement,
providing one-stop technological logistic solutions to the
supply chain.
Support for production and sales
SF is actively developing live streaming marketing andspecific business scenarios. By leveraging its brand influence
and conducting live streaming with popular onlineinfluencers at the places of origin, SF has connected the
production and distribution of agricultural products topromote their online sales. For pre-cooked dishes, lychees,
cherries, and waxberries and others, SF has worked
closely with local governments, associations, and
leading brands to host industry conferences.
The Company also developed “SF + Cold
chain + Technology” functionalities andprovided solutions for the industrial supply
chain, so as to promote the development
of the industry.
As of the end of reporting period, SF’s service network for helping agricultural products production and sales covered more than 2,700 county-levelcities nationwide, encompassing 226 types of more than 6,000 specialty agricultural products nationwide. SF fully contributes to the upwardmovement of agricultural products with practical actions, allowing more local brand specialty agricultural products to be known, tasted, andrecognized by the Chinese.
In 2023, SF's service network for helping agricultural products production and sales covered more than 2,700 county-level citiesnationwide, and cumulatively serve more than6,000 specialty agricultural products.
Connectingproduction anddistribution topromote upward
movement of
agricultural
products
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“Developing a Comprehensive Logistics System for Gastrodia Elata,Facilitating the Rapid Delivery of Fresh Gastrodia Elata from Yunnan”In recent years, Yiliang County has seized the opportunity of YunnanProvince’s initiative to create world-class “three brands” policies,making the Gastrodia Elata industry the leading industry in thecounty’s “one county, one industry” project aimed at strengtheningthe county and enriching its people. In 2023, SF actively respondedto the development and construction requirements of YiliangCounty, focusing on multiple dimensions such as cost, timeliness,safety, after-sales service, channels, and technology, to fully ensurethe fresh and rapid delivery of Gastrodia Elata from Yunnan. Inaddition to establishing a three-dimensional transportation networkof “air + land + high-speed rail” to ensure efficient and smoothtransportation, a Gastrodia Elata project team was also established,setting up multiple collection points in the trading market to providestrong support for the rapid delivery of Gastrodia Elata from Yunnan.
Site of “2023 SF Crab Industry Solutions Release Conference and ‘Dangtu Crabs’ Brand Promotion Conference”
Introducing transportation solutions for the crab industry, facilitatingthe upgrade of the brand of ‘Anhui Crab’In August 2023, the “2023 SF Crab Industry Solutions Release Conference and ‘Dangtu Crabs’ Brand Promotion Conference” was grandly heldin Ma’anshan City, Anhui Province. SF has been cooperating with crab merchants from various regions in Anhui for many years and has beenrecognized by local aquatic industry associations, being designated as the “designated logistics supplier for Dangtu crabs.”SF continues to introduce accurate and effective transportation solutions for the crab industry. On the product side, products weighing over20kg are upgraded with door-to-door delivery. On the packaging side, exclusive packaging for “Anhui crabs” is upgraded to help deliver freshcrabs to homes. On the technology side, traceability systems are employed to ensure the authenticity and freshness of the crabs from the source.Leveraging its own brand advantages, SF drives the development of regional public brands. In terms of sales, blending production and salestogether can help production areas expand their sales channels and promote the export of “AnHui crab” beyond Anhui province.
Accelerating “Express Delivery to Villages” to Promote Regional EconomicDevelopmentOver the years, SF actively explored the “express delivery into the village” model, through the establishment of a five-level administrative divisionaddress library, supported the decision-making of township and village resource investment, accurately identified rural parcels, ensured the timelinesscommitment of express delivery into the village, and created “precise entry into the village” high-quality service.As of December 31, 2023, the Company had more than 100,000 village-level post cooperation points, gradually forming a relatively complete ruralexpress network. The service network’s township coverage rate exceeded 93%, and the daily processing volume of township parcels amounted to 2.26million. Based on the high-quality logistics services, the extension to the front end of the industrial chain to the full-process service allowed farmers toenjoy more convenient and fast express services in the village.Over the past 15 years, SF has continued to explore and steadily advance, always sticking to the path of rural revitalization, promoting express deliveryservices to the countryside and villages, building an upward service network for agricultural products, practicing social responsibility with practicalactions, and continuously injecting new momentum into rural revitalization.
SF’s courier picking up fresh Gastrodia Elata
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Empowering the Talent TeamSF remains committed to driving its business through talents. SF continuously builds a “self-sustaining” talent mechanism andan elite workforce, which forms a healthy, sustainable talent supply chain, bolstering the Company’s rapid growth and futurecompetitive advantage. SF consistently increases investment in developing its talent pool to aid both employees’ and company’sgrowth, prioritizes the protection of employee rights, implements comprehensive employee care and welfare measures, aiming tocultivate a highly skilled, cohesive workforce.
Protection of Employees’ Rights and Interests
SF has formulated a sound labor management system, established diversified communication channels for employees and cultivated a talent poolfeaturing diversity, equity and inclusion. Through these efforts, the Company strive to build a harmonious labor relationship while demonstrating ourrespect and protection of the rights and interests of our employees.Human Rights ProtectionSF remains committed to protecting and respecting human rights of all groups of the communities involved throughout its global operations andthe communities in which it operates. SF strictly complies with the human rights related laws and regulations of the jurisdictions where it operates,and commits to the core conventions of the International Labor Organization (ILO) and the United Nations Global Compact, including the EqualRemuneration Convention, Minimum Age Convention, Convention on the Worst Forms of Child Labour, Discrimination (Employment and Occupation)Convention, Forced Labour Convention, Abolition of Forced Labour Convention, and Occupational Safety and Health Convention.SF’s commitment on human rights protection? Ensure equal opportunities: Every employee is treated equally and respected, regardless of their duties or positions. Selections
and appointments must follow the principles of fairness, impartiality and openness.? Protect against discrimination and differential treatment: Prohibit discrimination on the ground of any legally protectedcharacteristics such as gender, nationality, belief and age.? No employment of child labor: Explicitly stipulate that persons under 16 years old are not allowed to be employed.? No human trafficking: Prohibition of slavery or human trafficking in any part of the Company’s business and supply chain.? Collective bargaining and freedom of association: SF respects employees to freely connect with third-party organizations inaccordance with local laws, as well as to join, form or not join labor unions. Employees may join the collective bargainingagreements voluntarily. Employees have the right to participate in or form associations that comply with the laws and regulationsof the countries in which they operate.? Freedom of expression: SF respects employees’ freedom of speech within the legal boundaries and encourages employees toexpress their opinions freely and actively communicate with the management level.? No harassment: Being rude to colleagues, verbal provocation and other disrespectful behaviors and verbal harassment ofcolleagues, customers or external partners are not allowed.? No forced labor: SF does not force employees to work against their will, and resolutely prohibits threatening or restricting their
actions.? Rights to rest and leisure: Employees are provided with legal paid leaves such as annual leave, sick leave, marriage leave and
maternity leave according to their local laws and regulations.? Privacy protection: Disclosure of any employee’s personal information to others is prohibited without the authorization of the
Company and the employee himself/herself.The above commitments apply to all directors, officers and all workforce of S.F. Holding Co., Ltd. and its subsidiaries.SF has zero tolerance for any form of forced labor, child labor, discrimination, harassment, or other illegal behaviors. The Company has formulatedthe Employee Handbook and the SF Recruitment Management System that clearly prohibit child labor and forced labor, discrimination and unequaltreatment. In this way, the Company can ensure equal remuneration for equal work between men and women, limit working hours, protect therights and interests of female employees, and promote the employment of people with disabilities. In addition, SF has clarified the rules of disciplinarypunishment for harassment in the Rewards and Penalty Management Regulations. The Company requires all employees to review and sign theRewards and Penalty Management Regulations online, and also fosters the publicity in various regional organizations offline, covering all workforce. In2023, SF did not have any incidents of discrimination.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
In terms of staff recruitment, SF requires all candidates to register their personal information online at the application stage, and automatically identifytheir age through the system. For those under 18 years old, interviews for them are prohibited. Candidates also need to pass the system for facerecognition authentication in the onboarding stage to ensure that the information about the individual and their ID cards are identical. In the selectionof third-party partners, SF requires partners to submit documents to prove that their labor management meets SF’s labor standards and that there areno human rights violations such as child labor and forced labor.SF has stipulated working hours in the Employee Handbook, Attendance Management Regulations and Labor Contract and formulated the FlexibleWorking System to provide convenience for employees with needs for special working hours. During holidays and business peaks, SF increases thenumber of employees in some temporary and auxiliary positions. This reduces the work intensity of employees on duty and guarantees their rest time.The Company treats all workforce equally and adopts the same management of employees and protection of employees’ rights and interests as forself-employed workers. SF or third-party companies sign legal contracts or agreements with all temporary employees, pay appropriate remunerationaccording to the regulations, and purchase employer’s liability insurance (including accident insurance) or work-related injury insurance for alltemporary employees.If SF undergoes major restructuring or changes, the Company will explain 30 days in advance to the labor union and all employees. SF will fullyconsider suggestions from the labor union or employees before terminating the labor contract with the employees properly.Diversity and EquitySF adheres to the principles of equal employment in its recruitment of talents, and it will never restrict the recruitment and employment ofemployees due to factors such as gender, region, ethnicity, religious belief, economic ability and other factors. With continuous expansion of itsoverseas business, SF is deeply aware that building a diversified talent pool can help the Company better adapt to the complex and changing marketenvironment. Moreover, with the support of diverse talents, the Company can better understand the needs of customers from different countries andregions, and gain new perspectives and solutions to the business challenges.
The principles of equality in SF’s recruitment, promotion and remuneration management
Recruitment
Under the principles of fairness and equality, the Company have formulated a transparentrecruitment process that is clearly and formally communicated to all candidates. TheCompany will never restrict recruitment or employment based on gender, geographicalregion, ethnicity, religious belief, or financial situation.Employee promotion
The Company select and promote talents through open and transparent internalcompetitions or appraisals, providing equal promotion opportunities for all employees.
Remuneration management
The Company implement a fair, just, and transparent remuneration management system,and adhere to the principles of gender equality and equal pay for equal work, to ensurethat all employees share in our development fruits.
Diversified recruitment: In 2023, female workforce in SF accountedfor 15.8%, an increase of 1.1% compared with 2022. Ethnic minoritiesaccounted for 6.1% of employees, an increase of 3,200 from last year.In addition, SF’s overseas branches (subsidiaries) also actively employlocal personnel in the places where they operate, and by the end of2023, there were 2,510 foreign employees, an increase of nearly 2times compared with 2022.
Female senior managers: 131 people
Senior managers: 478 people
27.41%
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Paying tribute to the power of “she” – the growth story of femaleemployeesSF always upholds the core values of equality and inclusion, and strives to promote the growth and development of female employees in theCompany. In the field of logistics, the Company believes that female employees also have excellent skills and great potential. With their keeninsight, meticulous work attitude and unwavering perseverance, they have made indispensable contributions to the sustainable development ofthe Company.
Rights and Interests Protection for Female EmployeesSF respects women’s equal rights to development and determination in their own careers,and resolutely eliminates gender bias in the workplace. In the office, the Company setsup 34 baby care rooms to cater for the needs of nurturance and breastfeeding for femaleemployees in any other special occasions. SF also provides the “warm care boxes” toprovide female employees with female products including ginger tea with red dates andbrown sugar, heating pads, and hand cream. In addition, SF provides female employeeswith free female health screening checks for cervical cancer and breast cancer, anddistributes various caring gifts to all female employees on Women’s Day every year.In 2023, SF labor union established the Female Employee Committee to promote the effective protection of female employees’ rights and interests.The special rights and interests of female employees during pregnancy, childbirth, and breastfeeding were written into the Collective Agreement of SFEmployees’ Rights and Interests.
Recruitment of vulnerable groups: SF actively provides employment opportunities for the disadvantaged groups in society, and provides positionswith lower physical intensity (such as customer service, management, warehouse management, professional, etc.) to promote the employment ofvulnerable groups. As of the end of the reporting period, SF had more than 600 employees with disabilities in service.
Wang Huanzhen | 13 years of employmentWang Huanzhen is working as a courier at SF Weifang in Shandong Province. After joining SF, she loads andunloads trucks, distributes expresses every day, rain or shine, and she doesn’t leave work until she sees thather customers’ express delivery catch up with the fastest schedule. With her hard work, Wang Huanzhen hasbecome an expert in the industry and won multiple honorary titles such as the “2023 Women’s AdvancedIndividuals” award.Feng Limei | 10 years of employmentFeng Limei is the business manager in SF’s northern Xi’an district in Shaanxi Province and the manager of nearly30,000 couriers in Xi’an. As the president of Xi’an Postal Express Industry Labor Union Federation, Feng Limeivisits an average of 200 outlets every year and collects more than 800 demands from employees. With hersincere care for couriers, Feng Limei won the title of “May 1 Women’s model” in 2023.
Li Meiyu | 9 years of employmentAs a Malaysian, Li Meiyu is currently working as a team leader for cases regarding customer services at SFSingapore. As a “Premium customer server”, Li Meiyu adheres to the concept of “taking the initiative andresponding to everything”, carefully listens to and timely responds to every customer’s problem, and activelysolves problems for them. With her dedicated service to customers, Li Meiyu has won multiple honorary titlessuch as the “Best Customer Service”, “Star Award” and “2023 Individual Excellence” awards.
There are 15,556female employees who undertook healthscreening checks for cervical cancer and breast
cancer in 2023.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Carry out female-themed activities to show the “she-power” of SF
female employeesIn order to affirm the outstanding contributions made by female employees to the Company’s management and development, and encouragefemale employees to stand firm on their positions, strive to move forward, and compete for excellence, in March 2023, SF’s labor unionorganizations held the activity with the theme of Goddess Festival, namely “Finding the beauty in ‘She-Power’ and looking for the goddessin workplace”. Through the selection of the “most beautiful employee”, makeup teaching live broadcast and other activities, to help femaleemployees unwind while showcasing the “she-power”.Communication and Exchange with Employees
SF greatly values the voice of employees. The Company has established a variety of open, transparent and responsive channels to encourage employeesto be efficient and speak out. SF offers greater incentives and opportunities to grow for employees who put forward voices and suggestions that arebeneficial to business. Meanwhile, SF recognizes and praises organizations that actively listen to voices and suggestions as well as those who promotethe improvement and solution of problems.Apart from traditional telephone channel (labor union hotline 4006883783), network channel (“Echo platform” and “I want to report”), mailboxes,etc., SF builds diverse channels that can quickly solve employees’ problems in accordance with different scenarios. For example, the problem can bequickly solved through platforms such as the “Echo Help” through the intelligent reply system, visits paid by representatives of labor union and “CloudMaster” that can connect the whole network, which can swiftly address employees’ problems and appeals.
Communication Channel for SF Primary Employees
3,863collection of employee needs throughunion representative channels
95.8%
resolution rateSF listens to the voice of employees throughvisits paid by labor union’s representativesand other similar forms, communicates withemployees face-to-face, learns about theirworking conditions, welfare benefits and careerdevelopment, and timely reports feedbackabout their opinions and suggestions torelevant departments.
In 2023
Representativefrom the labor
union
14,946
phone calls received by theEmployee Care hotline Centre
96.1%
hotline connection rateSF opens an employee care hotline to ensuresmooth procedure in channels to cater foremployees’ needs on weekdays and holidaysand provide timely psychological support andproblem-solving solutions for them.
In 2023
Employeecare hotline
broadcasts
Over
1.37 million
live broadcast viewsThe Company’s policies will be delivered to thefrontline workers in the form of live broadcastat the first time, including institutionalprocess, system tools, business development,quality improvement and logistics support andemployee welfare.
In 2023
Appeal servicefor the frontline
workers
13,834
appeals collected
98.4%
resolution rateThe one-stop appeal service collects effectiveappeals from employees monthly to distributeto the relevant regional organizations forfurther solutions.
In 2023
One-stop
appealservice
98.9%
resolution rate on the
Echo platformSF applies industry-leading Large LanguageModel (LLM) technology to build a smart servicecentre for couriers in combination with theinternalization of actual scenes of SF, which cancarry out real-time human-machine dialoguewith couriers, respond to their questions, andquickly address their problems. The wholenetwork will be promoted by 2023.
In 2023
Smart tools
40,563
of solved problems on the “Echo Help”through the intelligent reply system
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Advice and Suggestions
SF continued to scale up the publicity and promotion of the system that collects advice and suggestions, encouraging employees to put forwardreasonable suggestions around the “five little matters” (little inventions, little creations, little innovations, little designs, little suggestions), promotingthe optimization of system and process, and reducing costs and increasing income.In 2023, based on the Productivity and Reasonable Suggestion Management Mechanism, the Company has set up a supporting implementationguidelines and reward mechanism, and established 61 review panels for the reasonable proposals to identify their rationality and feasibility from aprofessional perspective, evaluating the value points and contributions of values, and giving different degrees of rewards to the recommendationsthat are determined to be adopted. In addition, the Company has also launched a rationalization proposal platform to provide employees with a moreflexible, fast and democratic way to offer suggestions.
In 2023, more than30,000 people participated in providing
suggestions, collectively submitting over35,000 proposals.Among these,1,428 suggestions were adopted, resulting inrewards for1,758 people.
SF employees’ rationalization suggestions focused on six majorscenarios, including improving operational efficiency, ensuringcompensation and benefits, safeguarding delivery operations,enhancing safety in production, improving service quality, andenhancing service skills. Among them, scenarios related tooperational efficiency improvement accounted for the highestproportion, reaching44%.Democratic ManagementSF respects employees’ freedom of association and collective bargaining.Meanwhile, SF continues to improve its democratic management level,optimizing and facilitating communication channels to make sure thevoice of frontline workers’ voices are heard. All these efforts are madeto effectively improve the happiness index of SF frontline employees.The Company actively promotes the establishment of labor unionsin regional SF companies to highlight the practical needs of primaryemployees.Every year, SF elects employee representatives through democraticelections, and it discusses and communicates with the representativeson employee rights and interests such as salary subsidies, insurancebenefits, and vocational training in SF staff representatives’ congresses.In 2023, SF holds the collective bargaining conference of “Fostering SF’s high-quality development and accomplishing happy laborers” (namely staffrepresentatives’ congress), signing the Collective Agreement of SF Employees’ Rights and Interests.
improving operational ef?ciencyensuring compensation and bene?tssafeguarding delivery operations
enhancing safety in productionimproving service qualityenhancing service skills
44%15%
17%
11%
10%3%
As of the end of the reporting period, SF had established
130 labor unions in its whole network with 21,000representatives.
In 2023, there were 161 elected staff representatives, and
5 staff representatives’ congresses were held.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
SF’s Collective Agreement of SF Employees’ Rights and Interests SigningCeremony Successfully HeldIn order to ensure the effective protection of the rights and interests of all workforce,in July 2023, SF held the “Fostering SF’s high-quality development and accomplishinghappy laborers “ collective negotiation meeting and the signing ceremony of CollectiveAgreement of SF Employees’ Rights and Interests. With the remote witness of 761staff representatives, 12 negotiation representatives from the Group side and theemployee side communicated, negotiated, and explained around the demands andconcerns of express industry workers. They proposed a draft collective contract, whichwas unanimously passed through a democratic vote by 161 staff representatives, andsuccessfully completed the signing of the collective contract.
Signing of Collective Contract by Company and
Employee Representatives
On-site of SF Collective Negotiation Meeting
Main content coveredin the Collective
Agreement
RemunerationWorking hours and HolidaysInsurance and BenefitsSafety and health at workSpecial care forfemale employees
Vocational trainingDemocratic right
Reward and
Punishment System
Employee SatisfactionSF quarterly conducts satisfaction surveys for all employees, and continuously tracks the changes in employee satisfaction and employee engagement.It also analyzes and develops improvement plans according to the research results, and accepts the supervision of the all employees towards theimplementation of measures, and periodically reviews the improvement effect. In 2023, the employee satisfaction is 87.8%, an increase of 1.4%compared with 2022. In 2023, due to the Company’s deepening changes in its business model, the employee engagement shows a slight decline.The Company has focused and analyzed key issues, responded quickly and formulated improvement measures. In 2023, the rectification loop of 115points for optimization has been completed.
Results of the 2021-2023 Employee Satisfaction Survey
202320222021Employee satisfaction87.8%86.4%86.9%Employee engagement84.7%86.2%87.5%
100%
coverage rate of employees in the SFCollective Agreement
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Construction of Talent TeamSF takes human capital as its core competitiveness, pays attention to the introduction and incentive of talents, and creates an environment to attractskilled workers. It builds a comprehensive talent training and development platform, and supports employees’ career development, aiming for buildinga stable and efficient talents team.Talent Attraction and Retention
Through diversified talent strategies and training plans, SF extensively attracts talents, establishes a scientific and effective performance managementsystem, standardizes the whole process of employee performance management, and fully guarantees the stability and vitality of talent team.Talent RecruitmentSF facilitates online and offline recruitment channels such as campus recruitment, internal recommendation and online recruitment, and promotesintern programs and school-enterprise cooperation, absorbing outstanding workers and strengthening the Company’s talent pool.Deepening School-Enterprise Cooperation and Building a Solid AppliedTalents Training Chain in Logistics
Site of School-enterprise Cooperation Conference
In December 2023, SF held a discussion and exchange conference with theSchool of Logistics Management and Engineering of Zhuhai College of Scienceand Technology to further deepen school-enterprise cooperation and builda more efficient and practical logistics applied talent training model. In theconference, reviews and summaries were made to the development of “SFClass”. Looking ahead, the plan to establish “2024 SF Class” and relevantcurriculum to be conducted were also discussed by both parties.
SF-X University Elite Challenge of Smarter Supply Chain
Site of SF-X University Elite Challenge of Smarter Supply Chain
SF-X University Elite Challenge of Smarter Supply Chain is a large-scale logisticscompetition for college students across China. It requires participating teamsto provide innovative solutions for smart supply chain and is committed tocultivating innovative talents with practical spirit. In 2023, the competitioncovered 603 universities with 4,649 participants, rewarding 163 outstandingstudents with PASS cards (chances of interview in campus recruitment).
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2023 S.F. HOLDING SUSTAINABILITY REPORT
SF Regular Performance Evaluation and Communication Mechanism
? SF establishes an employee performance interview mechanism to provide employees with the results of their performancethrough the interview, and at the same time SF ensures the fairness and objectivity of the performance appraisal.? The Company pays attention to the quality of performance interviews. It carried out the “Excellent Case Sharing inPerformance Interview and Improvement Plan Signing” and compiled the Performance Interview Guidelines to strengthenmanagers’ performance coaching awareness and performance interview ability.
PerformanceInterview
? SF carries out an annual performance evaluation for all employees every year, as well as a monthly or quarterly performance
evaluation for employees in different positions based on the needs of operation and management. In 2023, 100% of theCompany’s employees have received regular performance reviews.PerformanceEvaluation
Performance Evaluation and Feedback
SF adheres to the performance management principle of “high quality, high yield and high return”, cultivates the employee performance managementculture of “Common purpose with practical actions”, and effectively leads employees to make progress together. In 2023, SF updated employeeperformance management mechanism, built a diversified evaluation system, and deepened the operation system of first accountability system tofurther standardize the whole process.
Establishment of “SF diversified evaluation system”
Diversified Value Creation SystemIn order to take the lead in value creation of SF employees, theCompany established a diversified evaluation system in line withcultural values, taking “on-job delivery value” “cross-organizationalcollaboration value” and “service support value” as its core.Supported by the “difficulty-overcoming value” “talent retentionvalue” and “knowledge empowerment value”, the system firmlydefined the value creation direction for SF employees, measuringemployee value creation objectively and effectively identifying andmotivating outstanding talents.
First Asking Responsibility SystemIn order to lead functional employees to better implement theconcept of first question service, SF has incorporated the first
asking responsibility system into the employee diversified evaluationsystem to achieve a more objective and three-dimensionalevaluation of personal value contribution. In 2023, the overallpositive rate of employees increased from 84.6% to 98.4%, andthe average demand resolution time decreased from 40 hours to 28hours.
Promotion of the “First Asking Responsibility system”
Talents Incentives
Under the principle of high performance and high salaries, SF establishes a compensation management system oriented to value creation and basedon performance appraisal. Specifically, for employees with high value contribution, the Company provides competitive compensation systems in orderto ensure its internal dynamics for sustainable development. Furthermore, the Company sets salaries based on the position and employee bonuses arerelated to the Company’s performance. Meanwhile, the Company attracts and retains core talents through differentiated and diversified short-andlong-term incentive mechanisms. As such, the core personnel will be more closely aligned with the interests of shareholders and the Company,ensuring the continuous growth of the Company’s long-term business performance.SF has established a comprehensive salary communication channel, providing employees with a full understanding of the salary structure through acombination of online salary query tools and offline face-to-face communications. Furthermore, SF regularly conducts reviews of its salary incentivemechanisms, analyses salary competitiveness, monitors salary equality, and ensures that the salary level is fair, reasonable, and competitive.
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Equity IncentivesSF grants stock options to its directors, senior executives, core management personnel, and key staff members. In 2023, the first exercise conditionsfor the stock option incentive plan for 2022 have been met, and a total of 1,252 incentive recipients have exercised their stock options.Honours SystemSF combines honours and awards with an honours system to set benchmarks and motivate outstanding employees.
Selectionorganization
Selectioncategory
Honor System of SF
Awardsetting
Honor
Annual excellenceselection of the
CompanyAnnual excellenceselection oforganizationsDaily excellenceselection oforganizations
BestSFer
Top awardof the Company
“Best SFer”Social Responsibility Award?Customer Service Award?Innovation AwardOutstanding Management Award?Long-term Contribution AwardHeadquarters Category?Special Awards (Key Figure/Business Pioneer)Individual awards by postsCollective awards by departments, functions, and outletsMoral model?Performance model?Innovation modelManagement model?Service modelExcellenceselectionof districts
Excellenceselection offunctionaldepartments
Excellenceselection of BUsand independent
organizationsMonthlyselection
instantaward
Cheer for
you
+=
Excellence selection
of the Company
Special
awards
Progressive upgrade
SF’s talent retention measures
For the outstanding employees in the performance evaluation, SF gives incentives from the aspects of care and reward, career management,retention and return visit to strengthen the retention of outstanding talents.
Care and reward– Stock option incentive– Offer extra two-day paid
leave– Display the list ofoutstanding achievementsand award exclusive giftsand activity funds
Career management
– Rely on the “CareerDevelopment Assistant” toencourage employees’ self-driven development, andpay bonuses to outstandingemployees– Provide well-performing
employee cultivation fund
Retention and return visit
– Conduct resignationinterviews to retainemployees– Visit resigned employees
regularly and send themgifts on special holidays
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Employee Training and DevelopmentSF highly values the growth and development of its employees by establishing a scientific and comprehensive talent training system and continuouslyenhancing employees’ professional quality and comprehensive ability. In this case, we aim to provide a smooth career development path for SFemployees and help them achieve long-term career development.Talent Training SystemSF has established a talent training system covering all workforce, including leadership training, professional ability training and other training.In 2023, the Company promoted the optimization of its overall training system by iterating the course and lecturer management mechanism,encouraging the creation of high-quality content, and boosting lecturers’ teaching enthusiasm; by establishing a demand map around the actualbusiness needs of key talent teams and matching course resources, the Company created a full-process training mechanism; at the same time, throughdigital platform transformation, the Company supported a closed-loop management of talent training work. Thus, the Company achieved “accuracy”of training needs, “supply” of training content, “discovery” of training resources, and “foundation” of talent team training. In addition, with thedirection of “contextualized”, “stratified”, and “specialized”, the Company continued to iterate the training of the talent team.
SF Training PlanTraining of Basic-LevelEmployees
For employee groups such as couriers, warehouse managers, customer service and sales staff, theCompany will focus on the cultivation of their service awareness, safety awareness, and communicationskills. While paying attention to personnel performance improvement, the Company will emphasize thesustainable development of personnel, help basic-level employees to improve their education, and paysattention to personal long-term development.
Echelon Building-Up ofMiddle and Basic-LevelEmployees
In terms of college graduates training, the Company will consider college graduates as an importantsource of the group’s talent echelon, thus it will independently operate special talent projects forcollege graduates and refine the operation of the “New Eagle Internship Plan, Excellent Talent Plan,Management Trainee Project”. By adhering to the three principles of “bold use of freshly joined,talent mobility, self-growth”, the Company will spot high-potential college graduates through rotationpractice, systematic course learning, dual mentor coaching and other training measures and matchthem with rapid development mechanisms, promoting college graduates to grow into core professionalpositions/key management positions.For junior managers (such as network heads), the Company will accurately identify actual business needsin various scenarios, carry out “network heads onsite special training camp” and “demands in scenarioslive room” activities in multiple sessions and multiple regions, and provide junior managers with moreeffective training resources through both online and offline.For middle-level managers (such as regional functional department heads), the Company will carry outlayered training from reserve to incumbent workers, iterate the “Fengyun Plan – Reserve FunctionalDepartment Head Training Plan” with scenario leadership training, actual job training, scenario tasksimulation as the core focus to train reserve personnel, improve reserve quality and achieve sustainable,high-quality talent supply.Professional TeamBuilding
The Company will focus on professional fields, sort out the ability situation of each functionalorganization, and improve ability through targeted training measures. The Company continues to carryout customized professional ability training projects, such as reserve expert training, expert lectures,expert forums, and provides learning resources on workplace general force and professional abilityboutique, continuously improving employees in the professional field and benefiting employees’ long-term development.
Senior ManagementTraining
Adhering to the guidance and principles of differentiated empowerment, refined management, andnormalized operation, covering three major groups of business managers, functional departmentexecutives, and reserve executives, the Company will carry out high-level cadre training projects such asbeacon training camps, Fengxing plans, and reserve executive training camps:
For senior operational managers, focusing on “setting direction, making decisions, leading teams”,through communication with moguls in the industry, visits to benchmarks, cross-industry exchanges,overseas study tours and other learning methods, the Company will help managers improve the ability ofhigh-quality decision-making and leadership skills when confronting uncertainties, thus promoting andimplementing the Company’s operation mode reform, and achieving sustainable and robust developmentof business;For senior functional managers, based on the Company’s strategic orientation and business needs,the Company will help each unit of functional executives with “chain operation, horizon expansion,capabilities improvement, and overcome insufficiencies, improving the effectiveness of supportingbusiness services and providing potential executives with differentiated learning resources and practicein various scenarios;For high-level back-up echelon personnel, through the combination of training and practice, theCompany will focus on core dimensions such as role transformation in a target position, leadershipimprovement, strategic business integration to customize the development of courses and learningcontent for the reserve echelon, provide multiple scenarios of actual practice positions and tasks, andeffectively improve reserve cadres’ matching degree for target positions.
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SF has introduced internal market-based incentives for lecturers to increase their training willingness and quality:
Average monthly effective hours of instruction increased by813 hours, a 31.9% increase from last year.575 new lecturers have been added during the year, with an instructor activity rate of 55.7%, up 10% from last year.
Developing high-quality courses to create key teams via “Jizhi Fengke” activityIn 2023, in order to provide key teams with more training resources which meet the actual needs, SF has organized the “Jizhi Fengke” activity.It brings together the excellent experience of all parties, collects the strengths, and creates high-quality demand scenario classes that arepractical and easy to replicate. These can effectively expand excellent course learning resources for the key teams and develop the quality ofskilled personnel. A total of 9,376 people participated in the development and evaluation of the courses, and more than 500 high-quality courseresources were generated.
Lecturer Team Building
Intensive creativeclass activities
More than
2,000
More than
Participants in coursedevelopment activities
Certified courses
Implementing the concept of “standardization+” and rebuilding thesystem of outlet reserve management talents training
SF has focused on the outlet reserve management talents, and has optimized the end-to-endprogram from the process of selection to training. The Company has implemented the conceptof “standardization +” to create an efficient and powerful outlet talent group.In 2023, SF has specified the standardized selection process to accurately identify talents.While performing “the first step” of the talent selection, SF has carried out a number of offlinetraining activities, including 6 training camps to improve the capabilities of station managers,and 10 “Ruifeng Plan” training sessions for reserve managers. In addition, each region hasestablished a secondary academy with personalized training needs, continuously enriched theonline learning resources for regional talents, and carried out a number of intensive training andempowerment activities in the region for reserve and on-the-job personnel.
Focusing on “benchmarking model enterprise and broadening horizons”to deepen digital transformation learningThe training system of SF transit team focuses on “benchmarking model enterprise andbroadening horizons”, and the SF transit team actively learns from enterprises with successfuldigital transformation and are the industry benchmarks.In 2023, SF transit team has organized and implemented three “external benchmarking enterprisevisits”, with “on-site visits + thematic exchanges” as the core, to learn from their secrets ofefficient operation. The Team combined the accurate diagnosis of internal situations with thehighlights of the external benchmarking enterprise visits to match the value points, effectivelytriggering the thinking of the transit talents, deepening the learning of digital transformation,and providing a talent guarantee for the continuous excellence of the SF transit site.
External Benchmarking Enterprise Visits
Special Training Camp for Station Heads
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Career Development ChannelsSF pays great attention to the career development of employees. To provide employees with diversified and open career development opportunities,SF continues to build a smooth promotion channel, and provides all-round career development support.Promotion ManagementSF continued to improve the mechanism of development programs in two channels, i.e., management competence and technical competencedevelopment, offering employees a sound development platform. Through the management competence development channel, employees withcertain management ability can participate in corporate operation and management. While through the technical capacity development channel,technical staff can become experts in various fields through continuous improvement in technical skills and accumulation of technical experience.Educational PromotionSF supports all workforce for degree programs and certifications, providing reimbursement of learning expenses to help them realize self-development.At the same time, SF actively carries out the program “SF Sends You to University” to build a platform for employees to improve their academicqualifications, skills and overall quality.In 2023:
SF supports exterior trainingfor employeesTotal inputs exceed
RMB4.6 million
“SF Sends You to Universities”
Total number of employeesobtained academic credentialsor certificates21,445
Total amount of subsidies granted exceeds
RMB1.8 million
Educational backgroundJunior collegeUndergraduate
Standard for the financial aidRMB5,000RMB10,000
“SF Sends You to Universities” Project
The 2nd “SF Cup” National Job Skills Competition Was Held
“SF Cup” National Job Skills Competition
In 2023, The Company held the 2nd “SF Cup” National Job SkillsCompetition to stimulate the enthusiasm of front-line employees tostudy professional skills, further “strengthening skills, improving qualityand providing excellent services” for colleagues in different positions toshow their personal value. The competition mainly focuses on the fourmajor positions of pickup and delivery, warehouse management, drivers,and transit. After fierce competition in the regional qualifiers and semi-finals, a total of 225 players were selected for the finals and went toShenzhen to compete in the summit.
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Employee Care and WelfareSF has established a comprehensive and multifaceted employee care and welfare system that positively influences the life of employees and theirfamily members from various aspects. The Company takes employees’ job security, medicals, food, housing and transportation, important festivals,important moments and other scenes as the entry point to establish a multi-dimensional, sinking security and care mechanism, understands the realneeds of employees, helps employees solve practical problems, enhances the sense of belonging and happiness of employees towards the Company,fostering the cohesion and sense of identity of employees.
Employee welfare andcare systemSF provides employees with a variety of welfare care measures from the three aspects of“ensuring basic welfare, improving caring temperature, and helping long-term development”.
Guaranteeingbasic welfare
Raising ofcare
Supportinglong-termdevelopment
Statutory benefit
Providing insuranceand housing fund, paidmaternity leave, paternityleave, parental leave andother statutory benefits
SubsidiesProviding food subsidies,communication subsidies,transportation subsidies,winter and summersubsidies
Living welfareProviding staff dormitory,staff canteen, remote work,and other living welfaresecurity
Physical and mental healthProviding healthcareservices such as freephysical examination,online consultation, videoconsultation, convenientmedicine purchase,psychological consultation, etc.Festival careProvidingvarious holidaybenefits/activities foremployees andtheir families
Deploying care
Offering freeshipping/family-visit holiday/family-visittransportationallowance, etc.
Performance care
Providing incentiveleaves, activityfunds and studysubsidies
Pension fordifficulties
Providing specialgreetings andassistance forabnormal weather/natural disasters/major diseases, etc
Care for family
Providingscholarships,grants, andother benefitsto employees’children
Recreational andsports activities
Organizingteam building,encouragingparticipation incultural and sportsactivities andholding art activities
Education and skillupgrading
Providing subsidies foreducation and skillsupgrading
Diversifieddevelopment withinthe Company
Smooth developmentpathways for transferand transformation
Honor andcommendation
Carrying out dailyand annual meritrecognition
Training
Providing multiple learningresources and channels
Employee welfare care system
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Guarantee basic welfareIn addition to statutory benefits, SF also provides employees withcomprehensive and diverse welfare security, including providingliving welfare facilities such as canteens and dormitories, allowingemployees to choose remote working and flexible working hours tomeet the personalized office needs of employees. In addition, thecompany will honor a number of care measures such as food subsidies,communication subsidies, transportation subsidies, winter and summersubsidies according to the positions of employees, so as to implementthe action of caring for employees to improve the quality of life andhappiness of employees.Care for the Physical and Mental Health of EmployeesSF always puts the health and safety of employees in the first place, adheres to the “people-oriented” development principle, provides employees witha full range of physical and mental health support, and strives to protect the physical and mental health of employees.
Safeguarding physical healthSF cares about the health of its employees, provides annual physical examination for all employees, and provides different physical examinationpackages according to the age and job classification of employees, to help employees identify health risks and get timely medical reminders.
Health check-ups for employees were organized, benefiting 192,000 people, including cancer screening, treatmentand recuperation for female employees, and free medical treatment for traditional Chinese medicine, dentistry, andophthalmology.Healthcheck-up
医医医医医
Forespace (Fengsheng) platform has introduced the Medical Housekeeper service and provided online consultation and drugpurchase preferential services, with a total of2,657 online consultations and 5,468 drug purchase services.
MedicalHousekeeperService
SF always puts the protection of couriers’ rights and interests in the first place, and takes multiple measures to protect their health and safety
Safeguarding couriers’ health
SF operates online medical consultation platform with couriers providing convenient service, and the annualcumulative consultation reaches about19,000 people
Equipped with first aid medicine box, the network configuration of SF is more than25,000Couriers’safety
Summer cooling activities were held in hot summer areas, covering more than 10,000 outlets and benefitingmore than630,000 peopleIn extremely cold weather, the whole network is equipped with scarves, gloves, knee pads and other cold materials,and employees in high-cold areas are provided with heating neckerchiefExtremeweather
Purchase of commercial insurance for all couriers at an investment cost of about RMB55millionOutstanding couriers reward serious illness insurance, the cumulative benefit of 57,000 people, theinvestment cost of about RMB8.6 millionPurchase of
insurance
Staff dormitories cover 43 business areas, with12,677 beds provided
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Care for Mental HealthSF attaches great importance to the mental health of employees, and helps employees grasp positive mental health concepts, master mental healthknowledge, and relieve emotions and pressure by setting up a mental care service hotline, building a psychological counseling platform, providingpsychological counseling services, holding mental health lectures and other activities.
Care about Mental Health
Mental Health Activities
One-to-one psychological counseling servicefrom the online and offline has served for morethan1,000 peopleSetting up a 24-hour hotline
Psychological
care
Mental health articles were pushed viaForespace (Fengsheng) platform, serviceaccount and other channels, with more than530,000 views
The “Shun Xin Ru Yi” self-psychologicalrelaxation experience platform has beenviewed more than180,000 timesPlatformpublicity
SF has organized 134 psychological carelectures with more than220,000
participantsSF has arranged Shun Xin Ru Yi Lecturefor56 times, covering more than22,000 people
Psychological
lectures
800 Shunxin service centers have been set
at outlets across the network
631 psychological activities wereconducted, covering more than35,000peopleDistrict happiness tour of psychology has beenset for51 events with over 2,000
participantsPsychological
activity
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Promotion of the warmth of care
SF deeply understands the needs of employees, cares about the lifeand work status of employees and their families, helps solve practicaldifficult problems, and carries out a variety of employee activities topromote work-life balance and enhancement of employee care.Care about Employees’ FamiliesSF actively carries out activities for the care of employees’ families, andprovides corporate welfare for employees’ families to enhance theirhappiness and sense of belonging.
Patrol vehicle for the Company Annual CelebrationNumerous of family members Stepping into SF
Golden Autumn Subsidies: the Company offered student subsidies of
RMB1.624 million to the families of 446
employees with serious diseases and major difficultiesScholarships for college entrance exams:
RMB362,000scholarships were given to158 children of employees who wereadmitted to universities
Carrying out greetings and assistance activities
The Company visited more than20,000 employees and their
families with difficulties, and the amount of assistance was aboutRMB11.61 million
Offering Student Subsidies/ Scholarship
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Cultural and sports activities,
SF carries out healthy and diversified employee activities to enrich their leisure life, stimulate their vitality and cohesion, increase their happiness andsense of belonging, and balance their work and life. In 2023, SF held 14,164 various activities such as birthday parties, symposiums and fun games,covering 484,000 people.
Holding the first “Happy Employee Festival” and “Fourth Culture andArts Festival”In 2023, SF has held the first “Happy Employee Festival” and “Fourth Culture and Arts Festival”. The Festival brought together more than 60organizations and attracted more than 300 employees to participate in the festival’s entries. During the Festival, more than 800 employees inGuangdong Province gathered together, and the traffic of the online live broadcasting room reached more than 560,000, which conveyed thisatmosphere of joy and art to others. The Festival not only provides a platform for employees to display their talents and exchange art, but alsofurther enhances the cohesion and centripetal force of the enterprise.
First “Happy Employee Festival” and “Fourth Culture and Arts Festival”
“Fengba” Cultural and Sports Activities
11 interest clubs were established with about 8,700 members, and over 20 major sports events were organized
Carried out “Fengba” Cultural and Sports Activities
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Building the Line of Safety
To adapt to the changes in the external policy environment and to support the stable expansion of the Company’s diversifiedbusiness, SF has paid great attention to and continuously strengthens the construction of the safety risk management system. Weare committed to creating a safe and healthy working environment for all workforce.
Principles and CommitmentsSafety Management PrinciplesSafety first, focus on prevention, legal compliance, full performance of duties, continuous improvement and sound development.Safety Management Commitments
1. Abide by national laws and regulations, standards and management requirements;
2. Company’s top executive is the first responsible person for safety of SF, and the chief leaders of each organization are the first
responsible person for safety of their own organizations In daily work, they implement the code of conduct and play the leadingrole in safety;
3. Adhere to the principle of people first and focus on prevention and achieve the target of “zero accidents”;
4. Provide necessary support, including manpower, resources and funds;
5. Establish communication channels on safety management for all employees and stakeholders;
6. Control production safety risks effectively and take actions to minimize the risks;
7. Optimize the allocation of safety management resources and continuously improve the safety management;
All of our stakeholders, including employees and contractors, are obligated to keep the Company’s commitment to production safetymanagement.
Safety ManagementSystemSF has built a comprehensive work safetyframework and established a group-wide worksafety compliance database according to pertinentnational laws, regulations and standards in thefield of production safety, such as the standardof occupational health and safety managementsystem (ISO 45001), the Guideline of ChinaOccupational Safety and Health ManagementSystem (GB/T33000) and NOSA five-star systemstandard (health, safety and environment). Thecomprehensive work safety framework consists of66 elements of production safety in 11 modules.
Comprehensive Work Safety Framework
Occupational
Health
SiteManagement
PeopleManagement
Posting andDelivery Safety
Facilities and
Equipment
Management
StakeholdersManagement
Transportation
Safety
Emergency and
Accident
Risk Assessmentand Control
BasicManagement
ContinuousImprovement
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Safety Management Structure and ResponsibilitiesSF has established the three-tier management organizations consisting of the headquarters, regional Department and Primary-level Department andimproved safety systems to effectively supervise and manage the safety management of all regions and guarantee the safe production and operationof the whole Company. The Risk Management Committee of the Board of Directors is accountable for overseeing the comprehensive risk managementof the company (including safety risks), assessing the completeness and effectiveness of the safety risk management system and providing suggestions.The Chairman and Chief Executive Officer (CEO) has the primary responsibility for our production safety, and our Safety Committee is directed bythe CEO and consists of senior management from each business. The Safety Committee supervises and manages the implementation of our overallstrategies, targets and performance in production safety, and regularly reports the progress in safety risk management to the Risk ManagementCommittee of the Board of Directors.
Safety Production Management SystemSF regularly reviews and updates our documents of the safety management system every year to give rational, appropriate and effective instructionson safety production management to all functional departments. The Company optimized the safety management system in 2023 in accordancewith the requirements of the Guidance on the Safety Management System (SMS) Construction for Enterprises and Express Enterprises (Trial) issuedby the State Post Bureau of the People’s Republic of China as well as the safety management working plan of SF. The company improved the safetyproduction management system in accordance with the key elements of ISO 45001 for occupational health and safety management system, andsupplemented and updated 42 management system documents.SF requires all employees to sign the Letter of responsibility for safety production to further strengthen the targets and responsibilities of personnelin charge of safety management at all levels. Which can further implement the primary responsibility for production safety, prevent and reduceproduction safety accidents, and protect the safety of people and property. The chairman of the Board of Directors and CEO is fully responsible forsafety management objectives, assuming the highest level of responsibility for work safety and undertaking the commitment to ensure the safety andhealthy working conditions of all company personnel. At the same time, each level’s primary leader is fully responsible for production safety withintheir jurisdiction.Safety Management TargetsSF regularly reviews the safety management and its effectiveness overthe past years. The Company quantifies health and safety requirementsand sets annual safety management targets every year, and linkthe target to the performance of safety management personnel. SFcontinuously tracks quantitative indicators related to the health andsafety of our employees and contractors. In 2023, there was no majorfire accident or major casualty accident occurred in the Company, andthe accident rate of casualties in millions of express deliveries decreasedby 15.1% compared with 2022, which successfully achieved the annualhealth and safety target. In 2024, we will strive to achieve a 5% year-on-year decrease in the casualty accident rate per million expressdeliveries.
Achievements of 2023 Safety Management Targets0 major fire accidentsAchieved0 major casualty accidentsAchievedAccident rate of casualties of one million expressdeliveries
decreased by 10% year-on-year
Achieved
The casualty accident rate covers all workforce in SF.
SF Safety Management Structure
Safety ProductionCommittee
Composed of the CEO and senior management from each business. It is responsible forformulating and supervising the company’s overall policies, targets and plans of safetymanagement, and determines the accountabilities for high-risk safety incidents.Regional SafetyProduction Committee
Composed of the leaders of each regional and district departments, and responsible for theimplementation of the safety management of the company’s safety production committee.Safety ManagementLeadership Team
Composed of the Command and Safety Center of the headquarter, functional departmentsand the safety management leaders of subsidiaries. They are responsible for all coordinationof safety tasks and implementation of safety matters in a rapid pace.
HeadquartersRegional
Department
Primary-levelDepartment
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Safety Management System Certification
SF has obtained the ISO 45001 (the occupational health and safety managementsystem) certification for all business operations.
The Third-Party Audit of SF Airlines Safety Management System (SMS)
ISO 45001 Certification
Shenzhen S.F. Taisen Holding (Group) Co., Ltd.Jiangxi Fengyu Shuntu Technology Co., Ltd.SF Co., Ltd.Shenzhen SF Comprehensive Logistics Service Co., Ltd.SF Group (Shanghai) Co., LtdSF Multimodal Transportation Co., Ltd.Guizhou SF Co., Ltd.
Shenzhen SF International Supply Chain ManagementCo., Ltd.Shenzhen SF Freight Co., Ltd.Zhejiang Shuangjie Supply Chain Technology Co., Ltd.Shenzhen Fenglang Supply Chain Co., Ltd.Shanghai Shunxiaofeng Distribution Co. Ltd.GZ SF Pharmaceutical Supply Chain Co., Ltd.Wuhan Shunfeng Zhida Logistics Co., Ltd.Phoenix-Wings (Shenzhen) Co.,Ltd.Shenzhen Xingshun Intelligent Supply Chain Co., Ltd. SF Airlines Passed the Third-Party Audit on Safety Management System (SMS)
In November 2023, SF Airlines successfully passed the third partyaudit on the safety management system (SMS) conducted by theCivil Aviation Management Institute of China. This further testifiesthe Company’s integrity, conformity and effectiveness in safetymanagement system.
100% Percentage of business operations
covered by ISO 45001.
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Safety Management MeasuresSF is improving the “dual prevention mechanism” of risk classification and control as well as potential hazard inspection and elimination. TheCompany have established a scientific and systematic management process in safety risk prevention, control and hazard elimination, which has formeda double firewall to prevent production and safety accidents. This enables SF to continuously improve its safety management capability and guaranteethe safety of its production and operation in all aspects.
SF Safety Risk Identification, Evaluation and Control FrameworkBuild anorganizationalstructure
Set up a safety management working group
Defineevaluationunits
Define evaluation units based on field scenarios associated with departments, positions, operationalactivities and operational procedures
Identify sourcesof safety risks
Identify hazardous sources from the four elements of “people, materials, management andenvironment”
Assess the risklevel of safety
Evaluate the risk level of safety using the Level of Risk Evaluation of Operational Conditions (LECmethod)
Safety riskclassification andcontrol
Identify the management layer based on the level of safety risk
Develop riskcontrol measures
Control measures include but are not limited to engineering and technical measures, managementmeasures, education and training measures, personnel protection measures, and emergency measures
Safety Risk Classification and Control
SF has changed the safety risk assessment method from MES to LEC. It determines the magnitude of the risk value by multiplying the frequencyof exposure to the hazardous factor, the severity of the consequences and the likelihood of occurrence of the event. All regions are required toidentify and assess safety risks at least once a year according to the requirements of the Hazard Source Identification, Risk Assessment and ControlManagement Regulations, and then categorize the risks into four levels in accordance with SF’s risk classification control principles and determine therisk control levels.Risk LevelRisk Value Assessed by LEC MethodRisk Control LevelLevel I: Material riskD≥320
Company level (functional departments of theheadquarters)
Level II: Major risk160≤D<320Department level (business/allocation area)Level III: General risk70≤D<160
Workshop level (transit center, service outlets/supplystation)
Level IV: Low riskD<70Team/position level
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SF Completed Third-Party Safety Risk AssessmentIn 2023, SF engaged independent third-party professional evaluationorganizations to conduct comprehensive and independent safetyassessment and risk source identification in multiple business operationslocated in South China and Northeast China, including distributioncenters, transit depots, collect and dispatch points and service points. Inaccordance with the result of the third-party safety risk evaluation, SFhas optimized and upgraded the current safety risk source identificationtool, thus to further enhance the applicability and comprehensiveness ofthis assessment tool. As the tool has been widely applied and promotedacross the network, the Company has significantly improved the workefficiency in the safety risk assessment.
In 2023, the Company organized a comprehensive safety riskidentification and evaluation regarding to the workflow of allpositions in 55 regions across the network. A total of 835 safety risksources were identified and appropriate risk control measures wereimplemented. These measures include but are not limited to promotionof tools used for identifying safety risk sources, optimization of securityrisk management process, and training and communication of safetyrisks.
Major riskGeneral riskLow risk
safety risk
sourcesin total
According to the 2023 inventory of production safety risk, the Companyconducted a special training on Key Risks and Control Measures ofProduction Safety for safety management personnel and functionaldepartment members across the network. With cases and pictures, thistraining deepened their understanding of the safety risk list of 2023and allowed them to learn and discuss the key safety risks and controlmeasures.
SF safety risk training scene
SF safety risk assessment on site
The Company attaches much importance to feedback, suggestions, andinquiries from our employees on safety management. We encourage ouremployees to provide suggestions and feedback on safety managementimprovement through various channels to the Safety ProductionCommittee. This proactive approach helps prevent potential safety risksin a timely manner and contributes to the continuous improvement ofour safety management.
Channels forreporting safetyincidents
Fengsheng App ——“Provide Feedback”
Labor Union Hotline
“Safety Whistleblower”
campaign
Labor UnionWeChat Service
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Safety Hazards Investigation and Management
SF has implemented a work safety assessment mechanism that involves “oversight from theheadquarters, cross-inspection between regional organizations, and self-inspection at locallevels”. With the mechanism, SF aims to strengthen independent safety management capabilitiesat regional levels and strives to mitigate or eliminate safety hazard. The headquarters alsoregularly evaluates safety production systems of transit depots and service points in all regionsof the network. In 2023, the headquarters evaluated the safety production systems of 41 transitdepots and 61 service points in 31 regions within the whole network. At the same time, we alsopromoted self-evaluation and self-improvement of safety production systems in all regions acrossthe network.In addition, SF revised and updated the Safety Hazards Investigation and Management Measuresduring the Reporting Period to add requirements for the investigation, identification, reporting andelimination of major safety hazards. We also formulated accountability and incentive provisionsfor investigation, to further standardize and strengthen the investigation and managementof potential hazards of safety accidents, and unify the Company’s safety hazard managementstandards.Remediation of potential hazardsIn 2023, the Company carried out more than 36 special risk elimination activities, including:
Comprehensive safety hazard elimination programSpecial safety hazard elimination program
? Investigation and elimination of major safety production
hazards program? Investigation and elimination of safety hazard program? Identification and evaluation of hazard source program? Safety system evaluation program
Transit depots: special safety hazard elimination
program in belt conveyor, equipmentpadlocking, forklift, cage trolley andbuilding structure on rainy and snowydaysFleet management: vehicle inspection, tailgate trucks, and
fixing of vans and caged trucksProperty management: summer/winter electricity for
firefighting, charging area renovationTerminal management: standardization of safety and
appearance management of two- and
three-wheeled vehicles
55%
Percentage of the business operations that
has been evaluated by the headquarters
in terms of safety production systems
100%
Percentage of distribution centers
thathas been evaluated by the headquarters
in terms of safety production systems
The distribution center is a specific area used for receiving, storing, loading and dispatching goods in the logistics transportation process.
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Operational and electrical safety
Contractor Safety ManagementThe safety management policy of SF is also applicable to the safety management of the contractorsand their employees. The Company clearly stipulates in the Work Safety Management Manual thatall contractors shall comply with SF safety management policies and take relevant responsibilities.In order to strengthen contractor safety supervision and management, in 2023, the Companyoptimized and updated the Management Measures for Contractor Safety to further refine themanagement of the contractor operation process. At the same time, the Company strengthenedthe contractor safety management through performance evaluation, regular review, accidentmanagement, communication mechanism and qualification termination, continuously improving thesafety management requirements for contractors.In addition, SF integrates relevant safety management requirements into the contract terms signed with contractors on the basis of business scenarios,and signs the safety management agreement with contractors to ensure that they strictly comply with SF’s safety management standards and eliminatesafety hazards. In 2023, the Command and Safety Center of the Company headquarters, jointly with other line-of-business departments, conductedon-site safety inspections of 321 contractors.
Operational Safety of Personnel at Transit DepotsCase: Elimination of Operational
Violations at the PlatformSF utilizes the Sharp-eyed Pupil (慧眼神瞳) snapping function andintelligent video recognition technology to capture personnel’sunsafe behaviors on the platform in real time, and issue timelywarnings to on-site personnel and video supervisors, to preventsafety accidents.
Monitor screen of “Sharp-eyed Pupil (慧眼神瞳)” in transit depotsCharging cabinets in the charging areas of operating sites
Case: Fire Safety Risk EliminationProgram in Charging Areas
SF conducts fire safety hazard investigation in the charging areas ofits operating sites across the network, and draws up correspondingfire prevention and safety management measures including:
Install hanging powderextinguishing devices
Arrange 24-hour video
monitoring patrol
Primary Safety Management Qualification Requirements for SF Contractors
Essential qualification requirements for the contractors include:
Having a business licensethat matches the businessservices it provides;
No major or above levelwork safety accidentwithin one year;
Having applicablepersonnel qualificationcertificate, specialequipment use registrationcertificate and transportvehicle license;
Purchasing necessaryinsurance for employees,such as transportation,warehousing or personalinjury (accident) insurances.
100%
of contractors have signed the safetymanagement agreement
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SF Safety Training System
Senior ManagementHold “professional lectures” to facilitate the exchange of excellent management experience, thusempowering senior management by equipping them with safety management skills.Safety management professionalsPrrovide various forms of training for safety management professionals within the network, including internalsharing sessions, external tutoring sessions and special safety training.All workforce
Develop their own safety training agenda by each region across the network, and provide standardsafety training for all employees (including contractors) in the region.
Occupational Health and Safety TrainingSF has established a comprehensive safety training system that offers targeted safety trainingcontent based on different levels and positions. The Company regularly carries out offline trainingactivities such as safety production month, safety knowledge competition, and finding potentialsafety hazards. We also post online safety training materials related to holiday safety, peak seasonsafety, seasonal safety and emergency safety to all employees to continuously strengthen theirsafety awareness.
SF provides sufficient internal training resources for safety management personnel to obtain professional qualifications. By the end of the
Reporting Period, the number of employees with safety qualification certificates across the network reached940.
A total of 27 safety training sessions were provided for safety management professionals, including:
Safety management sharingsessions
External tutoring sessions
Special safety training
SF Safety Training Performance Data in 2023
Total safety training sessions launched
96,000
Cumulative number of participants676,000 people
100%
Coverage rate of Health and SafetyTraining (including employees andcontractors) in 2023
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Safety Emergency DrillIn accordance with the requirements of national laws and regulations such as the Emergency Response Law of the People’s Republic of China and theWork Safety Law of the People’s Republic of China, SF has formulated a series of emergency response procedures and standards, and established andimproved the planning system to provide emergency response guidance. In this way, the Company has effectively improved its emergency responsecapabilities. In 2023, SF maintained the Comprehensive Plan for Work Safety by updating a total of 35 emergency response plans. Apart from firedrills in accordance with national regulations, the Company also regularly organizes diversified emergency drills every year centered on explosionprevention, anti-terrorism, traffic accidents and public health. These initiatives are designed to improve SF’s emergency response capabilities.
SF Airlines Nighttime Emergency Rescue Scene
SF Airlines Conducted the First Large-Scale Nighttime Emergency Rescue
Civil Aviation ExerciseIn December 2023, SF Airlines in Shenzhen and Ezhou cooperated with the Ezhou Huahu Airport to carry out a large-scale comprehensiveemergency rescue exercise named “Mission Accomplished 2023”. This exercise was the first large-scale emergency rescue comprehensive exercisecarried out by domestic airport hub at night with all-cargo aircraft as the simulated model, and it was also the first time for the Company to carryout practical exercise in the way of “one exercise for two places” (i.e., setting up an emergency command center at the headquarters, combiningwith Shenzhen and Ezhou for coordinated disposal).This drill successfully completed the fire fighting, medical rescue, aircraft removal and other practical exercise subjects, which achieved thepurpose of strengthening the cooperation between the two places in emergency response and enhancing the synthetic emergency responsecapability. The valuable practical experience gained from this exercise also played a pivotal role in constantly enhancing capabilities of SF Airlinesto handle emergencies.
SF Fire Emergency Drill Scene
A total of 13,000 drills were conducted, with an accumulated participation of 440,000 people
2023 SF Fire DrillsTo improve employees’ safety awareness and emergency response capabilities, and to ensure the safety of the Company’s property,packages and employees, the Company organized safety knowledge training and emergency drills in 2023, involving 55 regions across thenetwork, and rewarded those regions that actively organized drills and performed well.
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Building Responsible Chain TogetherUpholding the core value of integrity and commitment, SF attaches great importance to supplier management, and advocates asound cooperation environment of equality, mutual respect, transparency, development and mutual benefit. Over the years, SF hasbeen striving to reach long-term, stable and win-win cooperation with suppliers and partners, and to build a responsible supplychain together with them.Supplier Management SystemSF continued to improve its supplier management system, implemented a strict supplier management system, and strengthened ESG risk identificationand management in the supply chain. In 2023, the company has updated Criteria for Supplier Management, further supplemented, and improved thesupplier access process standards, access conditions, performance evaluation standards, on-site evaluation standards, etc., to continuously strengthenthe supplier refined management ability and reduce the risk of supplier cooperation.
Organizational Structure of Procurement Supervision Committee
Risk Supervision of ProcurementManagement StructureIn the process of decision-making and execution of procurementactivities, SF has a risk supervision organization to carry out independentrisk monitoring of the whole process.At the same time, the company makes purchasing strategies anddecisions through the collective decision-making mode of the StrategicProcurement Committee. Under the Committee, a Purchasing SupplyChain Center is set up, responsible for the execution of purchasingdecisions, purchasing demand analysis, and supplier management.Life cycle Management for SF Suppliers
Risk supervision of the
procurement process
Risk Supervision Organization
Decision-making, management,and Execution of procurementStrategic Procurement Committee
Purchasing Supply Chain Center
Classification and grading
According to the supplier’s cooperationperformance, the Company adopts differentiatedand dynamic grading and classificationmanagement for suppliers.Access accreditation
The requirements for supplier admissioncertification are clarified in terms of admissionchannels, admission conditions, and certificationaudit process.Performance management
The Company establishes a scientific and rationalperformance management and evaluationmechanism, develops quantifiable performanceevaluation criteria and conducts multi-departmental performance evaluations.
Routine management
Three mechanisms have been established tostrengthen the routine management of suppliers:
a training and coaching mechanism, a routineaudit and inspection mechanism, and aninformation change approval mechanism.
Exit management
There are two forms of supplier exit management:
penalty exit and non-penalty exit to standardizethe supplier exit process.Penalty management
For suppliers with breach of contract anddiscipline in the course of business cooperation,penalties are imposed with reference to the SFGroup Supplier Penalty Management Measures.
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Digital Management of SuppliersSF has continued to promote the upgrading of suppliers’ digital and intelligent management. The Company has enhanced the efficiency of suppliers’management and strengthened the risk control capability of supplier cooperation through various initiatives such as the construction of supplierManagement Dashboard, supplier Digital Archives and supplier Labeling System, and the establishment of supplier risk models.
Supplier Digital ArchivesGradually optimize supplier portrait andstrengthen supplier resume management toprovide decision makers with better supplierinformation and reduce procurement risks.Supplier Management Dashboard
Establish supplier management dashboard withdifferent levels and categories dimensions,achieving dynamic real-time monitoring ofsupplier resources, to provide decision-makingassistance for management.
Suppliers Labeling System
Build supplier labeling system and implant thelabels into the business system for employees toquickly identify and prevent supplier cooperationrisks, thereby improving the efficiency ofprocurement decisions.
Supplier Risk Models
Build a supplier risk model including tradecompliance risk screening, affiliation identificationand supplier credit evaluation to realize supplierrisk control in the whole process.
Supplier Management andEvaluation
The Company regularly conducts supply chain assessmentsand identification about environment, health andsafety, labor rights and ethical risk. Through regularsupplier on-site audits, written audits and other way,SF assess the performance of supplier cooperation andbased on the performance to put forward rectificationrecommendations, urge suppliers with managementdeficiencies to make rectifications and follow up on theirimprovement in a timely manner. Besides, SF will recognizeoutstanding performers and set an excellent example ofcooperation.
In 2023, SF conducts a comprehensive evaluation and managementof suppliers:
? SF audited over1,600 suppliers on site, with an audit pass
rate of
93.6%.
? SF carries out excellent supplier evaluation and recognizes more
than60 outstanding suppliers.
? The percentage of new suppliers screened through CSR standard
is
99.29%
? The percentage of targeted suppliers that have gone through a
CSR assessment (e.g. questionnaire) is100%
? The Percentage of targeted suppliers that have gone through a
CSR on-site audit is
96.46%
? The percentage or number of audited/assessed suppliers engaged
in corrective actions or capacity building is
79.03%
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Supplier Environmental and Social Impact AssessmentSF pays attention to suppliers’ environmental and social performance and strictly regulates the behavior of suppliers in the areas of environment,society and labor rights and interests. By doing these, SF promotes suppliers to strengthen their own performance in social responsibilities such as inenvironmental and safe area.SF focuses on the following areas in supplier environmental and social risk assessment:
In 2023, the company continues to build a value chain that has a positive impact on society and the environment through the following initiatives:
Environmental protectionHealth and safetyLabor requirements and protection
Environmental permitting and reporting
Pollution preventionExhaust emission
Occupational safetyEmergency preparedness
Labor requirementsFairness and equalityEmployee protection
SF incorporates CSR clauses, including environmental protection, health and safety, and labor rights,into supplier contracts.
When conducting supplier admission and evaluation, SF pays attention to the certification of relatedsystems involving ISO environment, occupational health and safety, and information security.SF regularly evaluates suppliers’ environmental and social practices, and includes such performanceas one of the indicators in their periodic supplier reviews.SF conducts on-site audits of suppliers on key environmental and social issues, and providesrectification recommendations and support to suppliers with deficiencies.
In 2023, the percentage of targeted suppliers with contracts that include clauses on environmental, labor, and human rights requirements is
99.29%.
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Green procurement related courses
Build the Sustainable Supply ChainFollowing the principles of fairness, impartiality and openness, SF has established standards of transparent admission in the front stage ofprocurement, a fair process at the middle stage and fair supervision at the backend to ensure a responsible and sustainable procurement environment.Green ProcurementSF has formulated the Regulations on Green Procurement Management to add corresponding environmental protection requirements to the life cyclemanagement of suppliers. At the same time, SF promotes sustainable concepts among procurement staff through initiatives such as online and offlinetraining and daily advocacy. In some extent, SF gives priority to the procurement and use of raw materials, products and services that are conductiveto environmental protection, such as energy saving, water saving and material saving, in order to guarantee the implementation of the greenprocurement concept.
Procurement Integrity ManagementIn order to strengthen the procurement integrity management capability, SF hascontinued to focus on building a comprehensive and profound anti-corruption compliancemanagement system. SF has formulated the Letter of Notification of TransparentProcurement to further determine the responsibilities of joint construction of integrityand the rights owned for both parties, building high-standard business ethical practices.Also, the Company signed the Integrity Agreement with suppliers, prohibiting any form ofsoliciting, offering or accepting bribes between the two sides in their transactions.
Supplier Anti-corruption Initiative
Registration
All suppliers are required to proactively declare the conflict of interest relationship, with 100% ofdeclarations in 2023.
BiddingSupplier affiliation is monitored to prevent their collusion with other SF suppliers.
Contact conclusion
The Integrity Agreement shall be signed. Reporting channels should be clearly stated in theframework master agreement, sub-agreement, and bidding documents. If suppliers discover acts suchas solicitation of bribes, they can report the complaint.
In 2023, the signing rate of the IntegrityAgreement has reached100%.
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The Group continued to optimize its online procurement management platform. In 2023, The Company has deepened the construction of the collusivebidding identification system to realize efficient early warning of compliance and potential integrity risks. For collusive bidding behaviors identified andwarned by the system, SF also carries out integrity actions at the first time to investigate and maintain the fairness and impartiality of procurementbehaviors. In addition, SF has enhanced its ability to control the risk of corruption in procurement by various initiatives, such as regulating ethicalbehaviors of procurement staff, providing regular anti-corruption training to procurement staff and requiring procurement staff to undergo regular jobrotation.
Supplier TrainingSF regularly organizes supplier training. The Company provides trainings on six modules including quality management, integrity cooperation, andgreen and environmental protection, to convey the cooperation concepts of green and environmental protection, and honesty and integrity tosuppliers.
SF Packaging Materials Suppliers’ Conference – advocate sustainabledevelopment cooperationIn September 2023, the Group carried out the SF Packaging Materials Suppliers’ Conference,inviting more than 60 supplier partners to be present. SF carried out in-depth communication ontopics such as changes in the procurement business, macro environment change of the marketand the management mechanism of packaging materials. Also, SF encouraged suppliers tocommunicate with each other, share their own experience. The conference passed on the conceptof synergy with each other under transparent cooperation and advocated sustainable developmentcooperation, so as to jointly build up an industry ecosystem for sustainable development.
SF Packaging Materials Suppliers’ Conference
Procurement integrity-related training
“Transparent Cooperation, Healthy Win-Win”:
In 2023, SF will conduct “Transparent Cooperation, HealthyWin-Win” integrity-themed training for external suppliers,covering more than150 suppliers."Integrity Responsibility, Risk Prevention”:
In September 2023, SF carried out integrity training on thetheme of “Integrity Responsibility, Risk Prevention” for allprocurement staff, covering more than300 people.
Conducts online training in the form of video and live courses.Uploads training materials in the form of training announcement onSRM system (Supplier Relationship Management System), notifiessuppliers to download the training course materials and requiresthem to complete the training by themselves.Supplier Online Training Exchange
Key partner
suppliersFull-volumesuppliers
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Shouldering Social Responsibility
As deeply understands that business and society are intertwined, SF has always been committed to public welfare and socialresponsibility without forgetting why it started. In 2012, SF has established SF Foundation and carried out a rich variety of publicwelfare projects and volunteer activities in medical care, education, environmental protection, etc., so as to give back to the societyin every small practice.
Education CharitySF Lotus Education Assistance ProgramsLaunched in 2012, the SF Lotus Education Assistance Program, through centralized application, family visits, continuous financial support andaccompaniment, aims to help students in need to successfully complete their education and grow into wonderful young people with excellentcharacter who can adapt to the development of the society and stand ready to give back to society.
In 2023, the SF Holdings was listed in the“2023 Top 10 Chinese Corporate Volunteer
Service Brands”
In 2023, 26 business region/organizations of SF has launched 59 “SF Blood Donation Day” blooddonation events in 37 cities with 2,904 people participated, over 777,430 ml of blood and 25
treatments of platelets successfully donated by 2,236 people.
In 2023, SF Foundation spent a total of RMB106 million on public charity.21 volunteer associations organized a total of155 public service activities, with 8,861 participants and a total of 34,948volunteer hours.
In 2023, the SF Lotus Education Assistance Program sponsored 13,718 students in need, with a total of RMB31.19
million scholarships awarded.By the end of December 2023, the Program sponsored a total of38,067 students in need with RMB228.3million scholarship awarded.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Public welfare activity in rural areas
Volunteers made door-to-door home visits one by one and providedfinancial support to 3,973 new students in needIn 2023, SF Foundation has organized 40 public welfare activities in rural areas, with more than 1,200 participants as SF employees, universitystudents of SF Lotus Program, and social volunteers. Our volunteers visited rural children in Guizhou, Gansu, and Guangxi, and 4,094 studenthouseholds were visited during the Program, with 3,973 new students identified as eligible for the financial support. The Program sponsored13,718 students in need, with a total of RMB31.19 million scholarships awarded throughout the year.
Financial SupportA total of 11,762 high school students and 1,956 college students were supported throughout the year, with grants totalling RMB25.09 million andRMB6.10 million respectively.
Psychology and HealthSF Lotus Education Assistance Program attaches great importance to the physical and mental health of students. A total of 367 thematic classmeetings were held throughout the year. 16,800 high school students and college students took the psychological test.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Dream sharing sessions
Offline empowerment training of Giving-back-to-Society Program
Dream sharing sessions to dream of a better futureIn 2023, the SF Lotus Education Assistance Program provided students 40 dream sharing sessions with various forms. Students engaging in“Giving-Back-to-Society” platform project, SF’s managers and volunteers were invited to share their dreams, struggles, transformations, andgratitude in their life. During the sessions, through participating in on-site interactions, singing inspirational song, dancing, and many otherinteresting activities, students were encouraged to dream of their future and fight for their dreams. In 2023, the SF Lotus Education AssistanceProgram has convened dream sharing sessions in 35 counties under, involving 3,807 students.
Diversified empowerment to help feed the comprehensive growth ofGiving-back-to-Society students
In 2023, SF Foundation has helped college students of the SF Lotus Education Program through feeding the community mutual aid platform suchas the Giving-back-to-Society Nesting Association, encouraging participation in public welfare activities (such as teaching in rural summer camps,visits to schools, etc.), organizing empowerment courses (Learning and Career planning, Personal development, Career preparation, etc.), andcarrying out the SF on-campus cultivation Internship and part-time jobs to help college students of the SF Lotus Education Program learn togetherand grow with their peers and continue to enhance their comprehensive abilities, so as to get ready for the workplace life in the future.
Empowerment for Growth32 empowerment courses were provided in 2023, with a total of 3,908 participants. A total of 117 empowerment public activities took place,including the rural summer camp, lesson creation contest, alma mater exchange communication, volunteer consulting about application for Collegeand University Admission , involving a total of 1,142 students engaging in “Giving Back to Society” platform project.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Rural summer camp
SF Liangshan Charity Class
SF Liangshan Charity Class ProgramSF Liangshan Charity Class Program is a welfare public programcooperated by SF foundation and Liangshan Yi Autonomous PrefectureMawei Development Center (the former Liangshan Yi Women andChildren Development Center) to help Liangshan dependent children(children who have lost their fathers or mothers and have nothing torely on in their lives) and female high school students in poverty. Theproject is committed to improving the living conditions of dependentchildren in Liangshan, supporting female high school students in difficultcircumstances to complete their education, and providing them withequal access to educational opportunities and resources. The programis committed to improving their living conditions, supporting femalehigh school students in need to complete their education, providingthem with equal access to education and enjoying equal educationalresources.In 2023, the program sponsored a total of 451 students in 8 classes(with 2 new classes of 120 students) throughout the year, while 4classes with 209 students graduated. By the end of December 2023,the program had set up a total of 25 love classes and sponsored 1,407orphaned children and poor girls.
The Giving-back-to-Society rural summer camp, A summer feast for
country childrenIn the summer of 2023, university students engaging in “Giving-Back-to-Society” platform project of the SF Lotus Education Assistance Programorganized 15-day rural summer camps in 10 rural elementary schools in 6 provinces: Hunan, Shanxi, Shaanxi, Yunnan, Henan and Gansu, with atotal of 141 volunteer students participated. The camp provided “music, sports, and art” lessons, psychological counseling, fun games, and manyother activities to give rural children an exclusive summer feast. In addition to enriching the summer activities of rural children, the camp alsosupports their all-round development in arts, physical health, and mental health to improve themselves.
We also apply the digital technology to empower the SF Lotus Education Assistance Program and improve the digital platform to enhance the studentexperience while increasing the efficiency of public welfare activities.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Medical CareSF Warmth and Care – Children Medical Assistance Program(hereinafter “SF Warmth and Care Program”) is committed topromoting early detection, early treatment, and early recoveryof children patients aged from 0 to 18 who suffer from relevantdiseases. It boosts the physical and mental health of children patientsin terms of medical assistance and humanistic care, and contributesto the development of “intra-provincial treatment of serious diseases”and the children’s medical industry.By the end of 2023, SF Warmth and Care Program had invested atotal of RMB432 million to assist 21,379 orphans and children withserious diseases, and had provided humanistic care services to 35,803people including children patients and their family members, as wellas medical staff.
The SF Warmth and Care Program congenital heart diseases inchildren screening activities in Chasum, Tibet
The SF Warmth and Care Program congenital heart diseases in
children screening activities in Shantou, Guangdong
Congenital heart diseases screening in children to care for the health of
children patients
In 2023, the SF Warmth and Care Program cooperated with the Children Cardiology Department of the University of Hong Kong ShenzhenHospital to carry out screening and assistance activities in Longchuan of Guangdong, Chasum of Tibet and Lundu of Guangdong. The professionalmedical examination is conducted to diagnose congenital heart diseases in time, contributing to early detection, early treatment, and earlyrecovery of the children patients.? In 2023, the SF Warmth and Care Program carried out the
fourth diseases screening activity in Tsawang County, LinzhiCity, Tibet. Following the comprehensive school screeningin two elementary school last year, this year, it also wentdeep into the most remote Tsawanglung Township and GulaTownship to carry out school screening, with a cumulativetotal of 1,233 children being screened, and 7 newly diagnosedwith positive congenital heart disease and in need of surgery.
? 2023, the SF Warmth and Care Program carried out
universal screening continuously in 11 kindergartens throughinnovative “heart ultrasound into the garden universalscreening” way in Lundu, Shantou, Guangdong Province,with timely discovery of 55 children with positive congenitalheart disease. The Program also provided guidance tokindergartens and parents for a better follow-up review andfollow-up work, guarding young children’s “heart” healthwith all their heart.
? In 2023, we newly helped an additional number of
3,424 orphans and children with serious diseases.? 15 self-run designated hospitals of the SF Warmth and
Care Program received additional2,134 children with
congenital heart disease, blood diseases and malignant
tumours in 2023, up13% year on year.? In 2023, the SF Warmth and Care - Children Medical
Assistance Program won the12th China
Charity Awards.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Public service activity on humanistic care of the
SF Warmth and Care Program in ZhengzhouMeanwhile, SF Foundation pays special attention to medical capacity building in rural areas and contributes to the development of township hospitals,so as to improve the medical experience of rural residents.
The Qinghe Town Health Clinic in Pingquan City, Hebei ProvinceSF donation has continued to promote the digital upgrading of the SF Warmth and Care Program, upgrading the medical assistance managementsystem and completing the R&D of humanistic care management system, and thereby providing children patients and their families with a better all-process experience from the early treatment to the later humanistic care service.
Public service activity on humanistic care to accompany the growth
of children patients
In August 2023, the SF Warmth and Care Program staff organized public service activity onhumanistic care with the theme of “Accompanying Children’s Growth”in Zhengzhou, HenanProvince. During the activity, the staff made online and offline return visits to 108 children patientsdiagnosed with blood diseases and malignant tumors, to learn about their current conditions anddreams for the future. The activity laid a solid foundation for future activities and accompanied thehealthy growth of the children patients.
Concentrating on the capacity building of rural medical and healthcare
system to facilitate the development of Qinghe Town Health Clinic
In 2023, SF Foundation supported the medicalservice capability establishment of the QingheTown Health Clinic in Pingquan City, HebeiProvince. New pre-screening and triageclinics, fever clinics and enteral clinics havebeen built in the health clinic to optimizethe process of patient care and improve thehealth-care environment for rural residents.
Humanistic care
In 2023, provided humanistic care services such as growth accompany to 10,765 people including children patients, parents, as wellas medical staff.Organized20 volunteer activities with a total of 1,010 volunteer hours, involving 1,232 people including children patients
and their parents, as well as medical staff.1,151 warmth and care energy packs were given out.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Disaster Relief
Disaster is merciless, while SF stand with love. In the face of all kinds of natural disasters, SF has always regarded serving the society and safeguardingpeople’s livelihood as its own responsibility, paid close attention to the situation in the disaster area, and mobilized the emergency resources of itswhole network to support the disaster relief in the first time. Relying on its own resource advantages and efficient deployment capabilities, it hascontinued to contribute its effort to help the people in the disaster areas and tide over the difficulties together.In 2023, SF actively participated in the earthquake relief in Baoshan, Yunnan Province, flood prevention and relief in the Beijing-Tianjin-Hebei region,and earthquake relief in Jishishan County, Gansu Province by leveraging our capacity to transport relief materials to the disaster areas in time anddonating materials and funds for the reconstruction of the disaster areas. SF continues to pay attention to the disaster situation and dynamicallyschedules relief forces to provide assistance and support for post-disaster reconstruction.
SF Airlines guarantees the transportation of earthquake relief materials
SF participates in the flood relief in the Beijing-Tianjin-Hebei region
SF participates in the earthquake relief in Longyang District, Baoshan City, Yunnan Province
In December 2023, when an earthquake hitthe Jishishan County, Gansu Province, SFput the B757 cargo aircraft into service andopened up the “Wuxi-Lanzhou” air route toquickly transport 20 tonnes of relief materialsto the disaster area, providing logisticssupport for the relief efforts.In August 2023, when a flood struck theBeijing-Tianjin-Hebei region, SF immediatelydispatched 20 relief vehicles loaded with foodand other urgently needed materials to thedisaster area, and distributed them to thepeople affected by the flood. In addition, SFFoundation announced a donation of RMB10million to prioritize the emergency needs ofthe disaster areas and provide assistance tothe post-disaster reconstruction.In May 2023, an earthquake occurred inLongyang District, Baoshan City, YunnanProvince. SF urgently procured relief materialsthrough various channels and deployedpersonnel and vehicles to load, unload andtransport them to the disaster area to ensurethe supply of relief materials.
Theme: Application of smartsupply chain technologiesto boost the transformationand upgrade of clients’supply chainCreating Smart LogisticsInnovation-Driven DevelopmentSecuring Safety DeliveryDelivering Premium Services
SERVICES
Services
2023 S.F. HOLDING SUSTAINABILITY REPORT
In the era of digital intelligence, SF has always been committed to empowering logistics and supply chain services with scientificand technological innovation, and realizing “data support decision-making”, “data-driven business” and “data-enabled customers”through the transformation of business digital intelligence. Through technologies including operations planning, blockchain,integrating the leading technology capabilities and industry experience, the Company embedded digital capabilities into thecustomer value chain, providing customers with production and sales full-scenario, fully visible, one-stop, traceable smart supplychain services. Through the integration of production and logistics, and the integration of marketing and logistics, the Companyhelps various industries create a responsive, flexible and smart, sustainable supply chain system that responds efficiently to facilitateindustrial upgrading, cost reduction and efficiency enhancement.
Establish smart supply chain integration products benchmarkThe Company integrates the whole set of technological capabilities to form intelligent supply chain products – Feng Zhi Cloud Chain *(丰智云链),Feng Zhi Cloud Strategy *(丰智云策), Feng Zhi Cloud Tower *(丰智云塔), Feng Zhi Cloud Data *(丰智云数) and Feng Zhi Cloud Marketing *(丰智云商) –for different levels of customer demands.
Integration ofprocurement planningand logistics activities
Integration of
scheduling plansand logistics activitiesIntegration of delivery
planning and
logistics activitiesIntegration of pricing
strategies andlogistics activities
Integration ofpromotional strategiesand logistics activities
Integration ofproduct strategiesand logistics activities
CyclicPickup Scheme
Inbound logistics line-upand loading optimizationat sourcing stageSmartPark SolutionPark-operation screen,vehicle schedulingand 3D map
ConsumerInsightsEnd-user portraitpro?ling andbehavior analysis
NetworkOptimization
Solution
Warehouse siteselection, routing
optimization,transportation schedulingMulti-levelReplenishment/Allocation Scheme
Solve inventory turnoverand out-of-stock problemsin multi-level warehousesMiddle-endBusiness SolutionOmnichannel Order
IntegrationManagementOne BucketSolutionSolve inventoryfragmentation problemin different channels
Online Store Solution
Customized O2O, B2C,B2B and othermulti-mode online stores
ForwardWarehouseSolutionShorten order-to-delivery
time and enhanceuser experienceStore Selection
ProposalsStore recommendationbased on historicaldata and forecasts
Forecasting
OmnichannelBusiness Platform
SmartWarehousing
SmartTransportation
Smart ParkSmart ShopMulti-CloudManagementCross-CloudComputing
Real-timeData Warehouse
Separation BetweenStorage and Computation
Auto Scaling
Logistics
Fund?owBusiness?ow
Information
?ow
Feng ZhiCloud Strategy
Feng ZhiCloud Tower
Regional
warehouses
Generalwarehouse
FactorySupplier
End-user
E-commerceDistributorsForwardwarehouseOf?inestores
Feng ZhiCloud Marketing
Feng ZhiCloud Chain
In-warehouseOptimizationSolution
Optimization ofin-warehouse picking-up,spot optimization,replenishment
Feng Zhi Cloud Data
PlanningStrategyWarningCollaborationInte
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SF Smart Supply Chain Products and Services
Theme
Application of smart supply chaintechnologies to boost the transformationand upgrade of clients’ supply chain
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2023 S.F. HOLDING SUSTAINABILITY REPORT
A supply chain operation execution system. Through modules such as ordering, warehousing,transportation and settlement, it assists enterprises to achieve the interrogation of warehousingand distribution and provide a full-spectrum supply chain solution, including intelligent storage andintelligent transportation.An intelligent planning/decision-making system for supply chain. It meets the intelligent decision-making needs of enterprise supply chain in different stages of preparing, planning and executionthrough the capabilities of warehouse network planning, intelligent site selection, commodity layout,demand forecast, sales planning, plan coordination, inventory strategy optimization/simulation,intelligent replenishment, route optimization, capacity optimization, execution monitoring, indicatorsystem, root cause analysis, etc.A supply chain intelligent control system. It achieves visualized the entire process from orderplacement, warehousing, transportation, settlement and other data indicators; it achieves riskearly warning, efficiency optimization based on the core node data exploring and analysis; it helpsbusiness decision-making, and generates work order tasks, drives business collaboration through themacro perspective insight into the whole business.A cloud native-hybrid data management platform. On cloud-native real-time scenarios, it realizesa centralized storage repository with a single storage of all data. The product is divided into fourparts, including the elastic storage layer, the integrated computing layer, the data insight layer,and the data application layer. In addition, it is equipped with member data platforms, membermanagement, and marketing capabilities.A cloud native-hybrid data management platform. On cloud-native real-time scenarios, it realizesa centralized storage repository with a single storage of all data. The product is divided into fourparts, including the elastic storage layer, the integrated computing layer, the data insight layer,and the data application layer. In addition, it is equipped with member data platforms, membermanagement, and marketing capabilities.
Feng Zhi Cloud Chain
Feng Zhi Cloud Strategy
Feng Zhi Cloud Tower
Feng Zhi Cloud Data
Feng Zhi Cloud Marketing
Services
2023 S.F. HOLDING SUSTAINABILITY REPORT
Integrating algorithm strategies according to business conditions, output scientific and reasonable daily replenishmentand allocation plans.Developed visual and automated replenishment monitoring dashboards to allocate daily output and inspectionresults, improving the brand’s express fulfillment timeliness with reduced warehouse cross rate.
Provided promotion strategies and packaging transportation optimization services, at the same time controlled
the allocation execution rate and followed up on abnormal problems, helping the brand reduce unsalable inventorywith improved packaging utilization rate.
Automatic Inventory? Introduction of RFID, gravity and visual IoT
devices and platforms for automatic inventory
Supply Chain Control Tower? Visualization of order fulfillment andinventory management? Multi-source heterogeneous data integration? Automatic statement generation, businessanalysis, and BI for decision support
Intelligent Replenishment? Automated store replenishment based ondemand forecasts, supported by operationresearch optimization algorithms and arules engineSupply Network Optimization
? Network planning and implementation offorward warehouse? Order fulfillment and inventory sharing inmultiple scenarios
Help thecustomer to:
Reduce store inventoryby
Reduce warehousedelivery costs by
Decrease scrap rate perstore by
Increase the forecastingaccuracy by30%15%1.4%5-20%
Providing Solutions for Smart Supply Chain
The Company leverages its comprehensive smart supply chain products and customer demand on business sub-segments, deeply reached dozens ofindustries including cosmetics, 3C and fast-fashion consumer goods with in-depth empowerment on over 4,000 enterprises. Smart Supply Chain Project for a Coffee & Beverage GiantTo solve problems in store replenishment, operation and supply chain management, SF and the customer jointly developed a smart storemanagement system and an intelligent replenishment forecast system, which use algorithms that mimic real business scenarios to empower thecustomer’s supply chain.
Full-Link Supply Chain of Lighting BrandBy applying analysis and algorithm strategy, SF provided smart supply chain services to a lighting brand, including intelligent replenishmentstrategy, and optimization of warehouse network coverage, order strategy and packing and shipping, to improve the brand’s express fulfillmentefficiency, reduce cross-bin rates and slow-moving inventory, thereby enhancing supply chain operational efficiency.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Digital Twin Construction
Creating Smart LogisticsThe Company is committed to establishing a smart supply chain ecosystem in the digital era and becoming a leader in the smartsupply chain market. The Company combines the massive data and industry solution experience gained in its comprehensive serviceofferings with leading digitalized, visualized, and intelligent logistics technologies to promote full-link supply chain technologyinnovation and help clients in various industries create a modern supply chain system with efficient and prompt response.Logistics Digital Twin Technology: Replace Experience withData and Let Algorithms Verify the FutureDigital twin technology refers to building a twin body in the virtual digital world that is highly similar to the real world from appearance, internalmechanism, and behavior. Through this simulation technology, it is possible to verify and optimize various strategies in the real world in the virtualworld at a low error cost. SF deeply integrates digital intelligence with its business to create a logistics digital twin system with high realism and fastalgorithm verification efficiency, to promote an innovative revolution for the logistic industry.
SimulationFidelity veri?cationParameteroptimization
Machine learning
3D reconstruction andrendering
Data collection
Data mining
Digital twin
Mechanism model
Data model
PersonnelLogistics
VehiclesProcedure
Transit center
Over the years, SF has been striving to create a logistics digital twin system with high fidelity and efficient algorithm validation. The system is used tosimulate and calculate actual business scenarios based on data from warehouse sorting and logistics route planning scenarios, so as to find the bestsolutions for various scenarios and explore ways to improve the efficiency of logistics operations at each process in the real world. Through digitaltwin technology, SF can efficiently simulate, validate and optimize the strategies in the real world with extremely low simulation costs and trial anderror costs virtually, helping the logistics industry to achieve efficient intelligent transformation in warehouse design and operation, logistics networkdesign and other aspects.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Warehouse SortingSF quickly verifies the feasibility andeffectiveness of the sorting plan byadjusting simulation parameters usingthe digital twin system. This enableswarehouse sorting plans to be switchedat almost no cost and with high qualityin the real world, significantly improvingwarehouse sorting efficiency.
For the same number of parcels, the newdigital twin sorting plan reduces sorting
time by more than10%
Within a fixed sorting period, the newdigital twin sorting plan can improveactual average capacity by more than
8%
In September 2023, SF held the “SF Digital Twin Press Conference” during the 15th International Exhibition on Transport Technology & Equipment,and released the Logistics Digital Twin White Paper in December 2023, which introduced its breakthroughs and achievements in digital twintechnologies to the public.
Logistics RoutePlanningBy connecting its own business systemwith the digital twin system, SF simulatesphysical entities, such as outlets andvehicles, in the virtual world, and imitatesall kinds of parameters involved in logisticsroutes to find out the best plan for parcelsafter evaluating all strategies. In thisway, it can effectively improve logisticsefficiency and optimize resource allocationin the real world.
On average, more than 500 transport routes percity per month can be avoided via the digital twin-based operation research optimization technology.
over 500 routes
Adoption rate of strategies recommended by the
digital twin reaches
Above 95%
Digital twin optimization improves logistics route verification efficiency by 600
times, greatly reducing manpower and resource consumption
600 times
While the digital twin technology continues to iterate, SF has primarily achieved:
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Upgrading the digital intelligence of the logistics networkSF has continued to improve its overall digitalization and intelligent level of the logistics network. Through the whole-chain digitalization throughoutits end-to-end operations from first-mile pickup to last-mile delivery, together with visualized monitoring and early warning, the Company hasachieved the universal intelligent planning and dispatching, dynamic resources matching and mapping, and flat and efficient management. Leveragingthe IoT technologies, automation and investments in unmanned technologies, the Company has improved network operation efficiency, with securedelivery guaranteed at the same time, thus enabling the Company to reduce costs with increased efficiency.Digital intelligence of forecast & schedulingUtilizing data, operation and intelligence, the Company created a universal intelligent decision-making system covering “forecast → early warning →scheduling → feedback”.
Forecast in advance: In order to ensure optimal and accurate resource scheduling and dispatching, the Company’s cargo volume flow forecasthas achieved multi-dimensional extension, from the overall cargo volume to province-to-province, city-to-city and other flow dimensions, enablingvarious forecasts, regardless of long-term, short-term, or dynamic as the case may be. Synchronized with these forecast results, the Company’ssystem can then adjust the pre-planning and on-going planning of various resources, thus ensure service quality and enhance resource utilizationand allocation efficiency.Network planning: The Company has been continuously improving the aviation and ground transportation network planning capabilities byestablishing and consolidating its intelligent network planning system tools. By utilizing the digitalization capabilities, the Company has visualizedthe data of customer demand and market dynamics to guide the utilization and adjustment of various types of sites under multi-networkintegration. With various product standards bearing in mind, the Company also accurately match aviation transportation resources accordingto the dynamic changes in volume demand of seasonal fresh food and other types of goods. Leveraging algorithm-backed dynamically adjustedstrategies and programs, the Company built an integrated multi-network ground transportation system to support various service scenarios,such as new modes of ground transportation, ground-air resource coordination, and flexible routing and loading of oversized goods for airtransportation, to maximize the efficiency of resources allocation and enhance the timeliness and competitiveness of the air and groundtransportation products.Real-time scheduling: Utilizing the universal operation monitoring system, the Company has achieved real-time monitoring, automated datacapture and intelligence warnings of abnormal scenarios, such as weather anomalies, flight delays and traffic control, as well as the monitoring ofour real-time operation status. Therefore, the Company would further recommend optimal adjustment plans intelligently and notify the frontierstaff to intervene for safeguarding the service performance in a timely manner, ensuring consistent delivery of product and proactive customerservices.Digitalized and intelligent sortingCommitted to establishing automated, visualized and intelligent sorting centers, creating an efficient and intelligent.Automation: In 2023, automation construction or upgrade projects in over 100 sites have been completed, thus further improved the transit andsorting capacity and efficiency of the whole network.Intelligence: Build up digitalized production managementcapability for major processes on-site. Site managers canuse the system to capture the potential risks of eachprocess in advance and take measures to avoid them, makemore refined deployment of equipment, personnel, vehiclesand other resources, improve the timeliness of expressdelivery, and ensure the smooth and orderly operation ofthe site during peak hours.Visualization: Leveraging image recognition and video
recognition technology, the combination of technical defense and human defense guarantees the transportation safety of express in theproduction process as well as the personal safety of personnel in the business process, provides a safe production and working environment forparcels and personnel, thus solving problems of quality management and safety risk control in sorting centers.
The system can provide cargo forecast information and site capacityestimation aboutevery 10-minute, and provide earlywarning of overcapacity on-site.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Case: Building a Digital International Air Cargo Hub – The Ezhou CargoHubThe Ezhou cargo hub comprehensively uses technologies such as building information modelling to consolidate the hub database, and adoptsoperations optimization, computer vision, and other algorithms to refine hub operation management and effectively ensure the time-definiteparcels.Dispatch collaboration? To ensure the time-definite transit of parcels at the hub, from take-off to landing, the full-link has been perceived and deducted andthe operation process and resource efficiency will be collaborativeoptimized.? The self-developed parking position allocation algorithm takestimeliness, transit efficiency, aircraft taxiing efficiency, and dozens ofbusiness operations into consideration to automatically form a pre-allocation plan, and adjusts in real-time according to flight dynamics,effectively reducing the complexity of the work of air traffic controlpersonnel and improving operational efficiency.? Automatically collect aircraft stand guarantee nodes, monitor in real-time through cameras, efficiently identify with intelligent algorithms,and accurately collect real-time node data information such as aircraftpositioning and aircraft push-out.
Field Operations in the Ezhou aviation hubSorting managementAutomated equipment and intelligent algorithms help the transit center increase capacity. The Ezhou cargo hub has an automated sortingequipment line with a total length of 52 kilometers, with a peak sorting volume of 280,000 pieces per hour. The parcel follows the optimalparcel walking path obtained by the algorithm, and smoothly and accurately falls into the boarding or loading mouth. Monitor the status of allautomated equipment in the field, warn of sub-health equipment, maintain during idle time, effectively reduce equipment failure rate and failurerecovery time.Computer room networkMultiple computer rooms back up each other, 5G WIFI signal covers the whole area, and the signal is strengthened in key operation areas such asloading and unloading vehicle areas, and dismantling and boarding areas, improving the reliability of the transit center, and ensuring the stableoperation of basic IT infrastructure and intelligent mobile terminals.
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2023 S.F. HOLDING SUSTAINABILITY REPORT
Digitalized and intelligent service outlet managementThe company further refined comprehensive digital operation and online management of collection and delivery at service outlets.
Digitalized and intelligent transportationContinuously improved the full-stack end-to-end digitalized and intelligent management across various transportation modes such as air, ground andrail transportation.Air transportation: In terms of all-cargo aircraft, based on the Ezhou cargo hub, the Company built up the capability related to abnormalscheduling and timeliness guarantee in hub scenarios; in terms of bulk flights, the Company improved the efficiency of procurement and thematching of resources and demand through the refinement of numerical and intellectual management tools to segregate procurement of demandand use, so as to guarantee the consistent availability of resources and meet the demand for timeliness.Ground transportation: Through intelligent route combination and resource structure design, the Company schedules resource reserves for a moreoptimal cost structure.In terms of transportation resource matchingBased machine learning and other technologies, the Company predicts data in terms of dimension including cost, task, and volume of each routeflow, and outputs the expected structure of different transport resources (controllability and elasticity); at the same time, through intelligentalgorithms, routes are packaged in combination according to various strategies and matched with the most suitable transport resources toeffectively control costs.During transportationThrough the digital system, the Company swifts from manual dispatch to automatic dispatch. If there is a temporary increase in transportationdemand, the system will prioritize the assignment of idle controllable transport resources to undertake, maximizing the reduction of temporaryresource dependence.In terms of transport resource outsourcing and pricingSF has built basic price for routes to calculate the corresponding route’s price according to the market average price, mileage, and other factorsin the industry through intelligent algorithms; on this basis, it further builds a digital transportation resource outsourcing system, and a series ofprocesses such as bidding, contract signing, and settlement are completed in one-stop through the online platform. At the same time, this systemcan output procurement strategies based on the intelligent route price base and pre-planning data of transport resources, and intelligently judgethe rationality of contracts or transactions, ensuring the rationality, transparency, and health of transportation resource outsourcing.Rail transportation: Through digital upgrading, the standardization of end-to-end railway operations has been improved, supporting theapplication of diversified resources based on high-speed rail freight, high-speed rail scheduled trains, express trains, and ordinary trains, providingcustomers with differentiated transportation services, improving transportation performance timeliness and customer satisfaction.
Collection and dispatching service capacity? Provide intelligent resource planning and dynamic scheduling suggestions at service outlets by combining factors such as forecasted parcel
volume, operational difficulty, courier professional ability, and couriers’ willingness to rest, so as to reasonably allocate collection anddispatch tasks and improve courier service ability, thus guaranteeing customer experience.? Provide differentiated subsidies based on the difficulty of collection and delivery tasks, mode of operation, and scenario specificity, sothat the couriers can get more reasonable compensation. The Company optimized the online delivery SOP, so that the system will quicklyformulate personalized operational requirements and operational guidelines based on customer preferences, consignment characteristics,etc., and dynamically push them to the cell phones or handheld terminal devices of the couriers to enhance their operational standardization.? Meanwhile, the “Courier Service Center” has been launched to support couriers’ questions at any time, providing couriers with intelligent,accurate, and easy-to-understand comprehensive information Q&A services quickly, with the accuracy rate reaching 90%. The Company hasbuilt packaging recommendation tools to accurately recommend corresponding eco-friendly packaging solutions and materials according todifferent consignments, to improve packaging quality, to protect the safety of customers’ shipments, and to avoid over-packaging and waste.Last-mile network construction? Integrated and upgraded the last-mile capacity scheduling system and operational tools to achieve the integration of large and small parcel
collectors and dispatchers, effectively strengthening the flexibility of the last-mile collection and delivery capacity.? At the same time, The Company upgraded its system capacity to further enhance the synergistic capability of various end channels, suchas service outlets, HIVE Boxes and post stations, to meet the differentiated needs of customers for receiving and delivering parcels and toimprove the customer experience while optimizing the resource utilization of the entire last-mile network.End transportation application? The end collection and delivery operation has been combined with automated transportation to enhance delivery efficiency. In office
scenarios such as industrial parks, transportation through automated collection and delivery vehicle and door-to-door transportation and
delivery through robots improved transportation efficiency and reduced the pressure for couriers. Terminal transportation applications have
been promoted in various places including Beijing, Shanghai, Shenzhen, Suzhou, Wuxi, and Hefei, etc.
Services
2023 S.F. HOLDING SUSTAINABILITY REPORT
InnovationCultivation
InnovationGeneration
InnovationImplementation
InnovationValueCreation
Innovation-Driven DevelopmentManagement of Technological InnovationInnovation is the soul of enterprise progress and development. Highly concerned with innovation R&D, SF is committed to driving business productivitythrough innovation, and encourages employees to create value in new and disruptive ways. SF has also established a sound innovation managementmechanism to inject impetus for sustainable technology-enabled innovation.SF implements mechanism-driven innovation to promote innovation from idea to practical application. Since 2016, SF has set up the InnovationWorkshop and continued to upgrade it. Up to now, it has realized a closed loop covering innovation cultivation, generation, implementation and valuecreation.
In 2023, SF continued to optimize its innovation mechanism and carried out diversified innovation activities to improve its innovation efficiency. Asshown below:
Conducted: 4 live courses by the Innovation Workshop 12 selective micro innovation reviews
4 Innovation Pioneer Award reviewsOutput: Over 2,500 innovation achievements 80% of employee participation rate
Services
2023 S.F. HOLDING SUSTAINABILITY REPORT
Promoting Industry-University-Research CollaborationWith an open and win-win attitude, SF continues to team up with research institutes, universities, and other partners to promote the technologicalinnovations development, such as digital twins, blockchain and operations, jointly creating a new era of intelligent logistics.
Creation π-The Third Innovation Competition on
Intelligent Logistics Application
SF Technology Postdoctoral Research Station
Partnering with Universities to Facilitate Industrial Innovation
Innovation Competition: In 2023, SF cooperated with Zhejiang
University National Science Park to hold the “Creation π-The ThirdInnovation Competition on Intelligent Logistics Application”. Thecompetition attracted top universities and research institutes fromaround the world and gathered various innovative projects, which,combined with regional development and the requirements oflogistics business scenarios, promoted innovation and developmentin intelligent logistics and contributed to the construction of theindustrial ecosystem.
Collaborative R&D: SF collaborates with Xidian University and Zhuhai Fudan Innovation Research Institute to co-develop a “Supply ChainCollaborative Management and Financial Service Platform based on National Cryptography and Blockchain”. The platform has completed systemestablishment and the design of the blockchain solution, and will greatly enhance the data credibility of internal supply chain system, and theindustry trust penetration level.Industrial Base: SF collaborates with The Chinese University of Hong Kong, Shenzhen to establish an “Industrialization Base for the Digital TwinResults of Logistics Transit Centers”. The collaboration aims to promote the construction of digital twins and intelligent operation and maintenancefor logistics transit centers, providing an industry-typical demonstration for enhancing deployment efficiency and optimizing operation plans.Scientific Research Station: In 2023, SF Technology’s Postdoctoral
Research Station began recruiting and cultivating high-caliber andcutting-edge talents worldwide. Besides cultivating talents for logisticindustry, the station established joint training and cooperationrelationships with top universities at home and abroad to promote theintegrated development of industry, university, and research in fieldssuch as digital twins, operation research optimization, and supply chainoptimization.
2023 S.F. HOLDING SUSTAINABILITY REPORT
ServicesSecuring Safety DeliverySF strictly complies with laws and regulations such as the Postal Law of the People’s Republic of China, Measures for Supervisionand Management of Posting and Delivery Safety in the Postal Industry, Management Measures for Real-Name Receiving andSending of Mail and Express and the Regulations on the Management of Prohibited Items for Posting and Delivery. By doing so, SFcan improve its safety management of delivery service.In 2023, the Company formulated and launched the Regulations on the Management of “Three Systems” for Safety Delivery, inwhich the principles for the internal management and control of the “Three Systems” are clearly defined and implemented, namelythe systems of real-name pickup and delivery, the inspection of parcels in delivery and the security inspection of the express mail.Through optimizing the internal management regulations, performing real-name authentication and strengthen the managementand control of illegal and prohibited articles, the Compamy can ensure the safety of mail delivery.
? SF collaborates with the Ministry of Public Security. and utilizes its authoritative “National Network Identity AuthenticationPlatform,” to verify user information.? The prompt of “Online Real-name Registration” and the link for real-name registration are displayed on the orderplacement pages of WeChat Mini Programs and Apps to guide customers to complete the real-name authentication beforeplacing orders.? SF regularly verifies the real-name information of credit account customers (enterprise customers), provides system promptsfor modifying incorrect data, and enhances the accuracy of real-name information.? Customer ID cards are automatically identified through the OCR/NFC methods. The combination of original ID card andtwo-factor verification is adopted to ensure the validity of real-name authentication.? SF has introduced the “Scan Me” function for real-name authentication, which allows users to automatically jump to themini program for real-name authentication after scanning with WeChat.? Real-name authentication prompts are optimized by adding reminders before, during, and after the ordering process. Usersare informed in advance to prepare valid identification documents.
Processimplantation
? Cause analysis is carried out on the data of abnormal real-name notifications of enterprises monitored by the State Post
Bureau. The problems are simultaneously exported to the relevant region in the form of daily reports for improvement andrelated departments are urged to rectify the problems found.
Assessment
andmonitoringManagement of Illegal and Prohibited Articles
SF, in strict accordance with the Regulations on the Management of Prohibited Items for Posting and Delivery, formulates the Standards for Receivingand Sending Common Articles and updates and releases them monthly. SF regularly carries out special rectification work on delivery safety. SF takesmeasures such as strengthening investigation and management, conducting employee training, and establishing incentive mechanisms to preventprohibited items from entering the delivery channels. The Company properly disposes the prohibited articles that entered the delivery channels,maintains the safety and smooth of delivery channels and creates a safe and stable delivery service environment for the public.
Systemcompulsion
Real-Name Authentication Management
SF strictly enforces real-name authentication management to ensure the safety and complianceof the delivery process. This is achieved via the dimensions of process implantation, systemenforcement, and assessment and monitoring.
In 2023, the real-name onlineregistration rate of SF was
99.84%, with an increase of
0.31% from 2022.
2023 S.F. HOLDING SUSTAINABILITY REPORT
Services
SF Supported the Safety Delivery in the 31st FISU World University Gamesin Chengdu
In August 2023, the 31st FISU World University Games held in Chengdu,Sichuan Province was successfully concluded. During the event, SFprovided perfect service to guarantee the safe delivery of sports-relateditems and documents.During the preparation stage of the competition, SF participated inseveral meetings with local government departments to coordinate anddeploy real-time operations. SF proactively coordinated with relevantdepartments in the pre-event stage to develop a full-process plan,identified and resolved issues on-site in a timely manner, ensuringthe smooth operation of centralized security checks. During thecompetitions, SF achieved zero occurrences of express delivery safetyincidents and its delivery service was highly appreciated by society. Asa result, SF was also honoured with the “Sichuan Province OutstandingEnterprise in Express Delivery Security Work of the 31st World UniversityGames” award.
Inspection and Management of Prohibited Articles
SF has strengthened its cooperation with relevant national sectors to jointly crack down on the transportation of prohibited articles and performcomprehensive and strict security inspections on each parcels to ensure the safety. This year, SF took a series of actions to comprehensively reducethe transportation of prohibited articles, which further enhanced the risk prevention for delivery safety. SF investigated and disposed 38,500 illegalprohibited articles in total.
TheStandards for Receiving and Sending Common Articlesis implemented into the system. Warnings and interceptions aredelivered when it comes to items that do not meet the standards in the process of customer ordering and collection.On the basis of inspection of goods in receiving and sending, mandatory photo inspection of high-risk express items is takenand uploaded to the system.SF increases the investment in high-speed security machine to improve the quality of security inspection. By the end of thereporting period, more than 1,100 high-speed security machines had been put into operation.SF develops its own intelligent security check platform, which checks parcels for security while they are being automaticallysorted, replacing with 99% parcels that undergo manual inspection. Additionally, security inspectors can remotely assesssuspected prohibited articles at multiple locations simultaneously through the smart security check system.SF enhances the government-enterprise collaboration by partnering with the Ministry of Public Security and the Ministry ofNational Security. Specifically, SF precisely tracks the parcels of suspicious individuals, intercepts them during the pickup andtransit sections, actively communicates with relevant departments regarding the suspicious articles, and cooperates them in thesubsequent processes.SF formulates the Reward Management Measures for Self-Inspection of Illegal and Prohibited Articles. SF sets positive incentivesfor security inspectors to encourage them to actively discover and report suspected prohibited articles. More than 800 safetyinspectors have been rewarded in 2023.Positiveincentives
Security checkimplementation
Government-
enterprisecollaboration
Pickup and
delivery
inspection
In 2023, SF launched special rectification actions such as the “Management of control of battery express parcels” and the “Control on the deliveryof inflammable and explosive articles such as fireworks and firecrackers” to effectively prevent inflammable and explosive goods, drug-related goods,dangerous chemicals, illegal publications and other illegal articles from entering the delivery channel.
“Sichuan Province Outstanding Enterprise in Express DeliverySecurity Work of the 31st World University Games” award for SF
2023 S.F. HOLDING SUSTAINABILITY REPORT
Services
SF Airlines Assisted in the Completion of A99 International Air TransportCertification and the First Air Transportation of Large-Power Lithium BatteriesOn November 23, 2023, SF Airlines successfully transported large-power lithium batteries of a leading new energy vehicle manufacturerfrom Ezhou to Germany. This was the first time that it’s large-powerlithium battery products were exported via the domestic airline,demonstrating the enhancement of SF’s ability to provide cross-borderair transportation services for dangerous goods.SF formulated a transportation support plan, prepared A99 materialswith special approval, strictly adhered to transportation operationalrequirements, and successfully completed the safety testing of lithiumbatteries and their packagings in accordance with internationalstandards. Besides, SF Airlines and Ezhou Airport evaluated theairport’s emergency response plan and SF Airlines’ emergency responsecapabilities based on the pre-set scenarios such as “emergency responseto fires involving dangerous goods within the cargo warehouse” toensure transportation safety.
Training on Identification of Prohibited ArticlesTo improve employees’ ability to identify illegal and prohibited articles, SF regularly carries out illegal and prohibited articles identification trainingactivities for grassroots employees. In 2023, SF carried out professional ability improvement training for safety inspection personnel. This training wasconducted through various forms, including sending safety-related training materials through internal online platforms and conducting offline training,self-training, morning meetings and other forms of training for new employees in different regions.
Additionally, by putting up posters to crack down on drug, prostitution and pornography, knives and other illegal and prohibited articles, SF remindsemployees to remain vigilant at all times and jointly maintain the safety of delivery services.Dangerous Goods Transportation
SF strictly abides by the relevant laws and regulations on the transport of dangerous goods. The company has established a comprehensivemanagement system for the transport of dangerous goods, such as the Dangerous Goods Transportation Manual and the Emergency ResponseGuidance for Aircraft Incidents Involving Dangerous Goods. Meanwhile, SF formulated detailed safety standards, standardized the classification,identification, packaging, collection and transportation, inspection and delivery of dangerous goods, strengthening the monitoring and managementof the transport of dangerous goods. In terms of the qualification of the transport of dangerous goods, SF Airlines has obtained the Category 1~9dangerous goods qualification for self-use aviation materials and commercial transport, and it has become the first airline in China to obtain theapproval under the A99 International Air Transport Certification.
SF actively invested in the research and development of dangerous goods transportation technology. In November 2023, SF participated in thedemonstration of application of the national key project “Safety Protection Technology and Equipment for Power Lithium Battery Transportation”for the first time as a benchmark logistics enterprise in the lithium battery industry. SF developed the key technology of power lithium batterytransportation safety protection equipment, and improved China’s transportation safety risk warning and accident prevention and control system. Inthis case, SF supports the high-quality development of China’s new-energy automobile industry.
As of the end of the reporting period, SF has conducted more than500 offline trainings.In 2023, the coverage rate of safety delivery training for the couriers is 100%, and the qualification rate of the trainings is 99.9%.
SF Airlines Supported First Transportation ofLarge-Power Lithium Batteries
2023 S.F. HOLDING SUSTAINABILITY REPORT
ServicesDelivering Premium ServicesSF continuously improves service quality, differentiates service competitiveness and continuously provides customers with high-efficiency and high-quality services. SF’s services have penetrated into industrial manufacturing, commercial circulation, salesof agricultural products, food and medicine cold chain, international trade, local life and other fields, covering all aspects ofproduction and people’s livelihood. This establishes a “fast” “punctual” “safe” brand image, which has been widely recognized bycustomers, industries and society.Enhancing Customer ExperienceSF continues to improve the industry service standards in various segments. It is committed to providing customers with high quality service. SF drivesthe coordinated delivery of all operational processes based on customer feedback, promotes the optimization of internal service standard processes,provides customers with speedy and warm services, and continuously improves customer satisfaction.Completed customer complaint service target in 2023 and target of customer complaint servicein 2024
Target of 2023Target achievement in 2023Target in 2024Customerservice
The dissatisfaction rate
towardscustomer complaint service is lowerthan 5%
The dissatisfaction rate customercomplaint service in 2023 was 3.7%
The dissatisfaction rate towardscustomer complaint service is lowerthan 5%
The dissatisfaction rate with customer compliant service is derived from satisfaction ratings with respect to the handling of customers’ complaint issues, which equalsto, the number of customers dissatisfied with the handling of their complaint issues / total number of customer complaints.
Create an online customer service center: SF provides customers with a more convenient and unified digital tool for after-sales service,
comprehensively enhancing the customer experience in the after-sales service process. For different claims circumstances, SF constructs the modeof differentiated direct compensation. While helping employees improve their operational efficiency, SF provides rapid services for high-qualitycustomers in the claim scenarios. At the same time, through in-depth analysis of the feedback of customer experience, SF fully explores customerfeedback, accurately identifies customer needs, and enhances customer experience.Improve the professional team for customer service: Through the “Ability diagnosis – Thematic empowerment – Online resource – Effect audit”,SF improves the professional ability of customer service in the whole process, strengthens the evaluation by means such as dialing test bymysterious person, business testing, and applies the evaluation results to the optimization of processes and tools.Expand customer service channels in a diversified manner: SF provides one-to-one exclusive service channels via WeCom for some enterprisecustomers, and gradually builds up the self-processing capabilities of WeCom to achieve self-service processing in simple scenarios. This year, SFhas achieved the self-service processing in 12 scenarios to provide customers with prompt responses and 24/7 uninterrupted service.
In 2023, SF continued to promote customer satisfaction by building online customer service centers, improving professional customer service teams,and expanding diversified customer service channels.
Customer Satisfaction Survey
SF conducts quarterly surveys on customer satisfaction and the NPS (Net Promoter Score), adopts online questionnaire survey and random stratifiedsampling, continuously monitors NPS and customer satisfaction scores of enterprises and individual customers and collects customer opinions. In 2023,the total number of survey samples exceeded 100,000, covering hundreds of cities across China, and the research content incorporated more than 40subdivision indicators in six dimensions, namely the express timeliness, express security, pickup and delivery service, sales service, after-sales service,and system service.
In 2023, SF received 32,578 complaints about products and services, a decrease of
12.1% compared with 2022, and the consumer
complaint handling rate reached 100%.
2023 S.F. HOLDING SUSTAINABILITY REPORT
Services
Customer Privacy Protection
SF pays attention to the privacy protection of its users and implements a comprehensive customer data security protection strategy covering all aspectsof the service process, including “ordering, pickup and delivery, transit, after-sales service, and operations”. It comprehensively safeguards the securityof customer data and privacy.SF’s measures to protect customer privacy in each businessBusiness ProcessOrder PlacementPickup and DeliveryTransit/After-salesOperationProtectionmeasures
Customers areencouraged to completeonline real-nameauthentication usingState Post Bureau’sAn YiDi Real-Name QRCode and the SF Real-Name QR Code beforeplacing an order.Information is alsocollected by means ofa virtual QR code uponpicking up parcels.
For sealed documentssuch as biddingdocuments andpersonnel files, it isforbidden to unseal andinspect the envelope. Bytaking and uploadingphotographs of the outerpackaging, it is ensuredthat the parcel is sealedand intact before it issent.
Data desensitization andintelligent outboundcalling are implementedto protect customerprivacy. When contactingcustomers, customerphone numbers areprotected with maskedphone numbersdisplayed on the callinterface. Alternatively,customers are directlycalled from the backend.
Encrypted storage andtransmission are usedto encrypt customerinformation stored inthe business systems anddata platforms to realizecipher text transmissionduring data transfer.
Since 2017, SF has taken the lead in launching SF privacy waybill - “Fengmi Waybill”, by hiding the middle 6 digits ofthe phone numbers of both senders and receivers. The personal information is encrypted on the waybill, and the virtualnumber is used to contact customers by the delivery personnel and customer service personnel through the informationsystem security technology. In addition, it also supports the differentiated privacy protection needs of customers,protecting the name and address information of customers, and comprehensively guaranteeing the security of customerdata and privacy.In November 2023, SF took the lead in launching the innovative “SF ID” service in the industry to provide users with amore convenient and private and secure way to send parcel. The “SF ID” service allows users to set a customized code(a combination of digits and letters) in place of traditional address information. After the setup, users no longer needto provide details such as phone number and address to the sender, but only need to provide “SF ID” for the pickupand delivering. The rest of the information will be encrypted and hidden, to realize the information encryption in thewhole process, greatly safeguarding personal privacy and security.
Further upgrade of claims service enables more convenient self-serviceoperationIn 2023, SF has launched its online self-service claims product that is based on risk models and intelligent compensation algorithms to effectivelysolve the needs such as the long-processing cycle, opaque processing progress. Customers can apply for claims online through the SF app or itsWeChat mini program, and then upload the relevant claim proof. They can receive quick compensation within 5 minutes, which greatly enhancescustomers’ experience in their settlement of claims.
According to the survey results, SF customer satisfaction and NPS continue to be promoted. According to the public satisfaction score of expressdelivery services in 2023 released by the State Post Bureau, SF ranked first in the first three quarters of 2023
. According to the China Net PromoterScore (C-NPS) released by Chnbrand in 2023, SF is the most recommended company that provides express delivery services.
As of the disclosure date of this report, the annual public satisfaction score of express delivery services in 2023 has not been released.
SF ID Interface
CLIMATE-RELATEDDISCLOSURES
Climate-related Disclosures
2023 S.F. HOLDING SUSTAINABILITY REPORT
PrefaceClimate change concerns the well-being and future of all humankind, and a globalconsensus has been formed to actively cope with climate change. As the UnitedNations Framework Convention on Climate Change (UNFCCC) and the Paris Agreementset the course for global climate governance, stakeholders from all walks of life shouldwork together to explore and establish a new mechanism for a comprehensive andefficient climate governance, so as to address the challenges brought by extremeweathers, to move towards a green and low-carbon future, and to safeguard ourplanet Earth.In 2023, the 28th Conference of the Parties (COP28) to the United Nations FrameworkConvention on Climate Change conducted the first global stocktaking since the entryinto force of Paris Agreement. The Conference summarized the achievements and gapsin countries’ progress towards achieving the target to limit the temperature rise, andreaffirmed the key concerns of independent contributions and energy system transitionmade by each country, as well as the target to limit the temperature rise to 1.5℃.China, as a major participant, contributor and leader in the global climate governanceprocess, has further refines the national goal of “Carbon Peaking and CarbonNeutrality” and actively participated in global climate governance by adhering to theconcept of green and low-carbon development, thereby contributing to the building ofa community of human destiny.Under the context of China’s “Carbon Peaking and Carbon Neutrality” goals, thelogistics industry, as one of the important pillar industries of national economicdevelopment, shoulders the critical mission of energy saving and carbon reduction.As a key player of green and low-carbon transformation in the logistics industry, SFalways upholds the original intention of sustainable development, and is committedto leveraging science and technology to take the lead in changing the green supplychain. SF has deeply integrated the sustainability concept with its development strategyby extending the green value to the industrial chain, thus providing upstream anddownstream partners and customers with green and low-carbon solutions supportedby digital intelligence technology. SF firmly believes that it can provide upstream anddownstream partners and customers with more efficient and low-carbon solutions inall aspects of supply chain logistics, such as packaging, transportation and transit bymeans of digital intelligence technology. In this way, SF has also built a green supplychain ecosystem jointly with its partners, contributing to achieving global climate goals.To actively respond to the concerns of stakeholders on sustainability issues, SF haspublished sustainability reports since 2019. In 2021, SF released a white paper oncarbon targets, setting out the climate commitment to “achieve a 55% improvementin carbon efficiency by 2030 compared to 2021, and a 70% reduction in the carbonfootprint of each parcel compared to 2021”. This year, by joining the Science BasedCarbon Targets Initiative (SBTi), SF took a crucial step in committing to achieve “net-zero” greenhouse gas (GHG) emissions across its value chain by 2050.To better understand the risks and opportunities posted by climate change, SF has fullyadopted the management suggestions and disclosure framework of the Task Force onClimate-related Financial Disclosure (TCFD) and has increased its climate informationdisclosure efforts. In addition, through policy research, industry benchmarkingand other means, SF comprehensively assesses and analyses climate-related risksand opportunities for an accurate identification of the key ones, and formulatescorresponding response strategies. Meanwhile, SF keeps on optimizing and refiningrelevant metrics and target management to ensure effective strategic response to thechallenges brought by climate change.The task of addressing climate change must be conducted with ambitions andpragmatism. Based on the present circumstances and looking towards the future, SFwill continue to improve its understanding of climate change risks and opportunities,actively explore paths of green innovation, continuously promote the low-carbontransformation of operations, and work with various stakeholders to jointly push ourindustry towards technology, efficiency, cleanliness and greenness.
Climate-related Disclosures
2023 S.F. HOLDING SUSTAINABILITY REPORT
GovernanceSF is keenly aware of the significant impact of climate change on its own strategic planning and business operations. Thus, SFhas integrated climate change governance as an important part into its Environmental, Social and Governance (ESG) system.To effectively respond to climate risks and continuously improve its governance level in ESG, SF has established a sustainabledevelopment governance structure since 2019 and continuously improves its ESG governance system. In 2022, SF also elevatedESG professional management work to the corporate governance level, and added responsibilities regarding the supervision ofsustainable development to the Strategy Committee of the Board of Directors that is responsible for monitoring and managingsustainable development issues, including the task of addressing climate change. In this case, SF integrates climate risks andopportunities into its strategic planning.
The Board of Directors, acting as the highest decision-making body for SF’s sustainable development andresponse to climate change, is responsible for the strategydevelopment, supervision and policy-making on ESGand climate change issues to ensure the implementationdepartments take effective measures to address ESG risksand impacts of climate disasters. The Strategy Committeedelivers ESG and climate goals and regularly discussestrends, risks and opportunities to keep information updated.Meanwhile, SF has incorporated carbon reduction targetsinto its corporate strategy, tracked them as a key issue tofollow up, and linked them with management performanceto ensure effective implementation of ESG and climategovernance.
The Board of DirectorsAuditcommittee
StrategyCommitteeSalary andassessmentcommittee
Nominatingcommittee
Riskmanagementcommittee
As a professional working body, the SustainableDevelopment Working Group is composed of representativesfrom the Office of the Board of Directors, various functionaldepartments involved in sustainable development word, BGs(Business Group), and BUs (Business Unit). It is specificallyresponsible for coordinating the implementation of ESGand climate change-related work, ensuring the effectiveuploading and issuing of tasks, and reviewing the risks andopportunities related to climate change.Sustainable Development
Working Group
The Sustainability Leadership Team composed of ChiefStrategy Officer (CSO), Chief Financial Officer (CFO), ChiefOperating Officer (COO)and Chief Human Resources Officer(CHO), reporting to the Strategy Committee of the Board ofDirectors, is responsible for setting and regularly reviewingESG and climate change related targets to ensure that ESGand climate related risks are fully considered and addressedwith SF’s decisions, investments and operations.Sustainability Leadership Group
In order to effectively implement and perform ESG andclimate-related management work, all business andfunctional departments of SF do a good job of ESG andclimate risk identification and carbon emission accountingin accordance with established management indicators andmechanisms, implement climate change risk managementmeasures in business activities, and implement energyconservation and emission reduction work plans to ensurethat ESG and climate governance work is comprehensivelyimproved.Business and Functional Departments
Overall planningDaily reporting
Supervision & guidancePeriodic reporting
Daily reportingCoordination in implementation& promotion
Decision-making SupervisionDaily ManagementImplementation
Climate-related Disclosures
2023 S.F. HOLDING SUSTAINABILITY REPORT
StrategyTo identify and assess the impacts of climate-related risks and opportunities in a more effective way, based on therecommendations of the TCFD framework and extensive industry research, SF adopts the two Shared Socioeconomic Pathways (SSPs)of the United Nations Intergovernmental Panel on Climate Change (IPCC) Sixth Assessment Report, i.e., SSP1-2.6 (Low-EmissionScenario) and SSP5-8.5 (High-Emission Scenario), to analyze the risks and opportunities of SF under different climate scenarios. Interms of physical risks, SF focuses on the impacts of acute and chronic physical risks under high-emission scenarios. For transitionrisks, the main consideration is the impacts of changes in various external policies, markets, technologies and other factors on SFunder low-emission scenarios.The climate scenarios adopted for the current year are shown below:
TypeScenarioSourceApplication Notes
High-emissionscenario
SSP5-8.5AR6 of IPCC
●Under this scenario assumption, GHG emissions
are projected to be at a high level by 2100 dueto the continuous exploitation of fossil fuels asthe primary energy to drive global economicgrowth, which may exacerbate the occurrenceof extreme weather events;
●Under such a scenario, the lack of robust
climate response interventions leads to asignificant increase in GHG emissions and a risein physical risks faced by enterprises.
Low-emissionscenario
SSP1-2.6AR6 of IPCC
●Under this scenario assumption, the economy
shifts rapidly from fossil fuel-dependent tothe renewable energy-driven one, and manycountries begin to implement strong climatemitigation measures to control the magnitudeof global warming in this century to notexceed 2.0℃ higher than the temperaturebefore the Industrial Revolution (1850).
●Under such a scenario, enterprises face a
higher transition risk as policy regulationbecomes more stringent in an effort to reach alower-carbon economic environment.In the meantime, SF identifies and assesses short-, medium- and long-term climate risks and opportunities, and maps risk management to SF’s short-,medium- and long-term strategic targets and action plans. During the year, SF defined the time frame of the its climate-related risks and opportunitiesas short-term (0 to 2 years), medium-term (2 to 5 years) and long-term (5 to 10 years), so as to assess the impacts and trends of the risks andopportunities under various climate scenarios in different time frames, thus formulating a more forward-looking and flexible risk managementstrategy.
Climate-related Disclosures
2023 S.F. HOLDING SUSTAINABILITY REPORT
Physical RiskPhysical risk refers to the impact of changes in climatic conditions on SF’s operations and development, including acute physical risks (e.g., typhoons,floods) and chronic physical risks (e.g., rise in average temperature). This year, SF conducted a comprehensive risk screening of acute and chronicphysical risks, identifying and analyzing the financial impact of key physical risks on SF. The physical risks identified by SF are shown in the tablebelow:
Risk TypeRisk FactorTime frame of InfluenceLevel of ImpactAcute riskTyphoonsShort-, medium- and long-termLow to medium
Risk Analysis
●
At the stage of transit, SF has a large number of domestic and overseas self-operated and agency outlets, transit centers,
logistics industrial parks and warehouses. Strong winds and heavy rains brought by frequent typhoons may cause damageto the facilities in transit centers, such as damage to the roofs of warehouses and breakage of the transit equipment, etc.,which may result in the malfunction of the transit centers, as well as a possible increase in maintenance expenses andoperating cost.●During the transportation, SF provides domestic and cross-border multi-modal transport services to customers using variousmodes of transportation such as air, land and railway. Severe typhoon events may have impacts on the overall logisticstransportation, resulting in goods being stranded in transit centers or warehouses and the inability to deliver goods to theirdestinations in a timely manner, thereby affecting logistics performance risk and causing loss of revenue.
Countermeasures●In the design and construction of transit centers (e.g., industrial parks), due consideration shall be given to the effects ofstrong winds and heavy rainfalls brought by typhoons. And in compliance with local building requirements, the design ofmulti-sloped pavement shall be avoided to prevent the formation of inward gullies produced by heavy rainfalls.●In terms of air transportation, SF Airlines has set up a meteorological seat in the Aviation Operation Command Center to
give warnings and forecasts about the weather situation in a timely manner, assess the specific intensity, scope and periodof influence of inclement weather in a refined way, and be ready to convey such information to the operational guaranteeunits such as the units responsible for dispatching and releasing goods, so as to provide meteorological support for thedecision-making adjustments on flights.
Risk TypeRisk FactorTime frame of InfluenceLevel of Impact
Acute riskFloodsShort-, medium- and long-termLow to medium
Risk Analysis●In transit, especially in regions prone to flooding, SF’s transit centers, warehouses and industrial parks may suffer fromwarehouse flooding or waterlogging, which may result in damage to goods in stock. At the same time, the logisticsinfrastructure, such as transportation equipment, piping systems and warehouse facilities may be destroyed, causing loss ofasset and an increase in repair cost.●Flooding may lead to serious damage to roads, bridges and other transport infrastructure, resulting in obstruction of routes
and delays in logistics transportation, thereby affecting SF’s transportation efficiency and causing a revenue decline.
Countermeasures
●
For industrial parks located in low-lying terrain, drainage facilities are checked in advance, and flood prevention anddrainage modifications are carried out in accordance with local requirements to cope with flood risks.
●On the basis of the news released by the China Meteorological Administration and the Ministry of Water Resources, SF’scommand and security center issued emergency plans such as the Emergency Response Plan for Flood Control and AbnormalWeather Response Plan to the whole network through emails and other forms of communication, so as to prevent the safetyrisks brought by the flood season by making work arrangements in advance, including organizing activities for safeguards,daily precautions (personnel safety, parcel safety, driving safety, site safety and materials reserve) and responses duringdifferent processes.
Climate-related Disclosures
2023 S.F. HOLDING SUSTAINABILITY REPORT
Risk TypeRisk Factor
Time frame ofInfluence
Level of Impact
Chronic riskRise in average temperatureLong-termLow to medium
Risk Analysis
●As the temperature continues to rise, the work efficiency of outdoor workers (such as couriers, sorters) is significantlyaffected. High temperature may make them fatigued, suffer from heat stroke or physical discomfort, which in turn reducestheir work efficiency. Meanwhile, the expenses incurred for high temperature subsidy and environmental improvement mayincrease the operating costs.●High temperatures may increase the refrigerant requirements for SF’s cold chain logistics (such as cold warehouses, coldtransport vehicles), which may lead to the rise in refrigeration costs.●High summer temperatures and temperature differences within the business area due to geographical location may adverselyaffect the storage and transportation of consignments or result in loss of revenue.
Countermeasures●Based on external weather forecasts, we established and improved the weather monitoring system, which can give earlywarnings of high temperature. By doing so, our staff can respond to the risk of extreme high temperatures in advance.●Implementing safety and health measures for high-temperature work, including the provision of cooling materials such asportable fans, special renovation projects for ventilation and cooling, and the reasonable allocation of working hours andtime for rest, to avoid injuries to personnel caused by extreme heat.
●Based on the national urban temperature data and routing data collection, we developed an environmental temperaturemodel and divided the country into different temperature zones. Through the use of different temperature control materialsand composite temperature control technology, temperature control packaging solutions and refrigerant configurationrequirements based on temperature zone and flow direction are formed to deal with the potential adverse effects broughtby extreme temperatures on consignments.Transition Risk
Transition risk refers to the risks brought to enterprises by a series of changes in policies, laws, technologies, and markets in the process of respondingto climate change and shifting to a sustainable economy. By analyzing the macro environment, industry characteristics and internal research, as wellas the characteristics of its own business mode, SF has conducted in-depth analysis of four types of transition risks, namely the policy and regulatoryrisks, technical risks, market risks and reputation risks.The key transition risks identified during the year are shown in the table below:
Risk TypeRisk Factor
Time frame ofInfluence
Level of Impact
Policy and regulatory risks
Pressure from the GHGreduction policy
Short-term, medium-term and
long-term
Medium to highRisk Analysis? Since the announcement of the “Carbon Peaking and Carbon Neutrality” goal, China has successively issued a series of
relevant policies for the fields of energy, transportation and logistics, such as the Plan for Modern Logistics Developmentduring the “14th Five-Year Plan” Period and the Outline for the Development of Green Aviation Manufacturing Industry(2023-2035), to promote the green and low-carbon transformation of the economy. These pressures from the relevant macropolicy adjustments will influence SF’s core business activities such as express transportation and warehousing services, whichmay have an impact on SF’s business model, and may also lead to an increase in SF’s expenses on environmental protection,energy conservation and emission reduction and other related activities.
? In terms of offshore compliance, the EU-ETS has included the air transport sector, aiming to reduce the carbon emissions of
aviation through market mechanisms. With the rapid expansion of SF Airlines freighter fleet and the increased demand forintercontinental routes, SF Airlines may be included within the scope of carbon emission trading control in the future, whichmay lead to an increase in additional operating costs.
Climate-related Disclosures
2023 S.F. HOLDING SUSTAINABILITY REPORT
Countermeasures●Continuously tracking the progress of laws and regulations at home and abroad and incorporating them into the riskassessment process, SF has set up a national and local policy research team to deeply analyze the relevant policies that havebeen issued and make strategic layouts in advance in light of the changes in the internal and external environments.
●For international routes, SF continuously monitors the volume of flights and closely follows the policy changes of the EUETS. Accordingly, SF has set up the working group on EU route carbon emissions and formulated the Guidelines of EU RouteCarbon Emission. By strengthening carbon business management capabilities in an all-round way, opening up relevantchannels, and cultivating professional talents, SF can cope with risks in advance.●SF invites the professional third-party institution to carry out carbon emission verification every year to gain a deeperunderstanding of its own carbon emission status, and implements refined management of energy saving and carbonreduction in order to promote scientific and standardized emission reduction work.
Risk TypeRisk Factor
Time frame of
Influence
Level of Impact
Technical risk
R&D and investment in low-carbon transition technology
Short-term, medium-term and
long-term
Medium to highRisk Analysis
●Under the joint promotion of policy and external market environment, the investment of R&D in new energy and carbon
reduction technology in various application scenarios of logistics and transportation field has gradually received wideattention, such as the application of hydrogen fuel cell electric vehicles, sustainable aviation fuel (SAF) and other innovativetechnologies in various transportation links. SF is increasing its investment in electric vehicles in vehicle transportation,while continuing to expand its own freighter fleet in air transportation. The R&D and application of new energy innovativetechnologies in transportation scenarios require substantial capital investment, which may increase short-term costs.
Countermeasures
●SF has actively participated in seminars on the development of SAF to gain an in-depth understanding of the relevant
cutting-edge technologies and market dynamics. Based on this, SF explores the feasibility of deploying SAF projects topromote the green and low-carbon transformation of air transport.
●Considering the maturity of new energy vehicle technology and the conditions of replenishment facility, the pilot operation
of new fuel vehicles such as LNG, CNG, methanol and hydrogen is planned to be carried out in some specific areas or routesin the future.
Climate-related Opportunity
On the road to a low-carbon economy, with the transformation of energy structure, changes in market demand, and the emergence of technologicalinnovation, SF actively takes forward-looking climate adaptation measures and actions, which also brings new development opportunities for SF itself.The measures and actions include the development of new products and services, and the optimization of supply chain resilience.Type of OpportunityOpportunity Factor
Time frame ofInfluence
Level of ImpactProducts and services
Development and/orexpansion of low-emission
products and services
Short-term, medium-term and
long-term
Medium to high
Climate-related Disclosures
2023 S.F. HOLDING SUSTAINABILITY REPORT
Opportunity Analysis? From the policy perspective, China has successively issued a number of policies in recent years, such as the 14th Five-Year Plan
for Circular Economy Development and the Instruction on Accelerating the Construction of a Waste Recycling System, whichclearly points out the comprehensive implementation of the recycling mode of production, and provides strong guidance andsupport for various industries to vigorously promote the development mode of circular economy.? From the market perspective, as climate change becomes more and more a focus of attention, downstream customers and
consumers shift their preference to greener and low-carbon services and seek sustainable supply chain solutions. Meanwhile,by actively responding to customer demand for green and low-carbon services, SF can win the favor of customer and itscompetitive advantage, and it can also promote the green and low-carbon transformation of the upstream and downstreamsupply chain.
Countermeasures? In line with the development trend of circular economy, SF has deeply created a circular ecosystem of express packaging,
cooperated with the industrial chain to the downstream, and actively participated in the development of a new model ofgreen, low-carbon plastic recycling and the formulation of green packaging standards such as “double easy” (easy to recycle,easy to regenerate). At the same time, we continue to implement the “Fengjing Plan”, and actively practice packagingreduction, reuse, recycling, and degradation, promoting the enthusiasm of customers to participate in recycling as well as thedevelopment of circular economy.? SF has cooperated with a number of brand customers. Through the carbon emission calculation model of SF’s self-developed
“Fenghe Sustainability Platform” with digital intelligence, it helps customers to learn about the volume of GHG emissionsduring transportation, which enhances the transparency of carbon emission data and provides customers with greener andlow-carbon logistics solutions.Type of OpportunityOpportunity FactorPeriod of InfluenceLevel of Impact
Resource efficiency
Usage of more efficienttransport modes
Short-term, medium-term and
long-term
Medium to high
Opportunity Analysis
●As green logistics continues to be popularized and promoted, multimodal transport has received widespread attention as one
of the key strategies for advancing green logistics. In order to ensure the accelerated implementation of policies supportingmultimodal transportation, China continues to promote the Work Plan for Optimizing the Development of MultimodalTransport and Adjusting the Transport Structure (2021-2025). In this way, it helps establish a unified, open, orderlycompetitive transport service market where various modes of transport are deeply integrated and comprehensive transportefficiency is improved, reducing the logistics costs and promoting energy saving and carbon reduction in transport links.
Countermeasures●SF makes full use of its own resources such as air transportation, land transportation and delivery hubs to develop
multimodal transport combining highway, railway, waterway and air transportation. In terms of bulk transport business,SF has participated in the national multimodal transport demonstration project, continuously optimized the transportorganization model, and provided rail transport services from pick-up and delivery to settlement, further enhancing itscompetitive edge of business in the industry. At the same time, SF is actively exploring a new logistics model of air-railcombined transport, which has carried out demonstration projects in Wuxi and Shenzhen. Working with partners to promotethe integrated development of rail transportation and modern logistics industry, we make full use of capacity resources ofurban rail transportation, reduce traffic congestion, and foster the green and low-carbon development of logistics.
Climate-related Disclosures
2023 S.F. HOLDING SUSTAINABILITY REPORT
Risk ManagementSF has established a risk management framework at the company level based on the risk management framework of enterprise andfully integrated climate change risks into the its risk management system. SF also conducts regular identification and assessment inaccordance with the its overall process of risk management to identify, manage and disclose significant climate-related risks.The Risk Management Committee of the Board of Directors, as the highest decision-making body of SF risk management, isresponsible for the effectiveness of the SF’s risk management system, such as identifying, preventing and monitoring climaterisks and ESG-related risks, and the Committee is also in charge of formulating strategies to cope with the related risks. The RiskCommittee, as a body under the Risk Management Committee of the Board of Directors, is responsible for considering and makingdecisions on the risk management system, systems, major risk prevention and crisis response that incorporate climate change risks.In addition, the risk control and compliance department regularly conducts discussions and analyses on climate change-relatedissues, and prepares SF’s overall risk report taking climate change risks into consideration, and submits it to the Risk ManagementCommittee of the Board of Directors for further consideration. SF ensures timely transmission and effective handling of riskinformation including climate risk through regular reporting and communication mechanisms, thus forming a risk managementmechanism of efficient collaboration and close communication.In order to effectively manage climate risks, SF effectively combines climate risk assessment and risk management, establishesa sound management mechanism and process for climate risk identification, assessment, control and supervision, and forms arisk management process of “risk environment analysis – goal setting and risk identification of risk control – risk assessment – riskresponse – supervision and improvement”.
Risk environmentanalysis
SF continues to pay attention to and analyse changes in the internal and external environment broughtabout by climate-related risks, including pressures exerted by external policies, market trends, SF’s risktolerance, and business operation models. If environmental changes have a significant impact on riskmanagement strategies or measures, SF’s risk management and control department will make timelyadjustments to the risk control strategy planning.
Goal setting and riskidentification of risk
control
Based on SF’s goals of risk control, it conducts in-depth research and analysis on the internal and externalconditions and key matters affecting the realization of the objectives, covering multiple aspects such asinternal management, external economic environment, natural environment and laws, regulations andpolicies. In this case, we can identify and sort out the list of risks related to climate change.
Risk assessment
SF adopts a combination of quantitative and qualitative methods to conduct climate risk analysis andassessment. Based on the probability of risk occurrence and the degree of impact on SF’s objectives, theidentified risks are prioritized and the risks that are confirmed to be given the extensive focus and thepriority to control. As a result, the risks can provide information for the reference of formulation andadjustment of SF’s development strategy.
Risk responses
Taking into account the causes and tolerance of risks, SF weighs risks and benefits, brand reputation,social responsibility and other factors, and based on the results of risk analysis, the Board of Directorswill review and determine appropriate and effective risk response plans to ensure SF’s stabledevelopment.
Supervision and
improvement
SF continues to follow up, monitor and manage the handling of climate-related risks. In daily work, SFimproves its ability to cope with climate risks by continuously optimizing its risk control mechanism andmanagement capabilities.
Climate-related Disclosures
2023 S.F. HOLDING SUSTAINABILITY REPORT
Metrics and TargetsAs the largest integrated logistics service provider in China and Asia and the fourth largest in the world, SF always adhere to theconcept of sustainable and healthy development. We understand the importance of participating in global climate action, and weactively respond to the global carbon reduction initiative in an attempt to practice the national dual carbon strategy, and achievethe long-term goal of the Paris Agreement to limit the rise in global temperatures to 1.5°C that is lower than that of the pre-industrial level. Based on carbon reduction achievements in the past, SF released the industry’s first Carbon Target White Paper,committing to improve carbon efficiency by 55%, and reduce the carbon footprint of each parcel by 70% in 2030 compared to2021. On 23 November 2023, SF has formally signed and submitted to the Science Based Targets initiative (SBTi) the BusinessAmbition for 1.5°C Commitment Letter to demonstrate our commitment to achieving the scientific target of GHG emissionsreduction and striving to achieve a net-zero emission of the value chain by 2050.
IndicatorsProgress on Climate Action
Future Plans for Short- andMedium-Term/Goal Setting
Scope 1 and scope 2
Clean energy
●By the end of 2023, SF has 26photovoltaic projects in operation andconstruction in its industrial parks,with a total installed capacity of 116megawatts.
●14 photovoltaic projects that have
been put into operation havegenerated a total of 18.39 million kWhof photovoltaic power generation.
SF plans to continue to invest in theconstruction of photovoltaic projects in itsindustrial park in 2024. By the end of 2025,all photovoltaic projects are expected to becompleted and put into operation.By then, it is expected that the total installedcapacity of photovoltaic equipment in theindustrial park will reach 140 megawatts andthe annual power generation will exceed 100million kWh, realizing a stable supply of greenelectricity.
Scope 3
Greentransportation
●In 2023, SF actively adjusted the
structure of transport vehicles,continued to optimize the selectionand replacement of traditional fuelvehicles, and further expanded theproportion of the fleet of energyvehicles. By the end of 2023, SF hascumulatively deployed over 31,000new energy vehicles, serving a total of243 cities.
In 2024, based on the maturity of new energyvehicle battery technology and replenishmentconditions, SF plans to select several areas orroutes for the pilot and application of LNG,CNG, methanol, hydrogen and other fuelvehicles.By 2030, the Company will strive to achieve100% electrification of vehicle equipment inthe aviation base.
Greenpackaging
●In 2023, we have reduced carbon
emissions by about 540,000 tonsthrough green packaging initiativessuch as packaging reduction,recyclability and degradability, whichreduced the use of packaging basepaper by 43,000 tons, and reduced theuse of plastic by about 162,000 tons.
In 2024, SF will continue to carry out thesophisticated R&D of the reduction technologyfor various types of packaging materials,and complete the formulation of mandatorynational standards in the Requirements forRestrict Excessive Packaging. Meanwhile, SFwill complete the switch in the scale of usingdouble easy recycled plastic bags in 7 majorcities, while applying recycling technologyto other packaging materials to improve theamount of recycled plastics.By 2030, we will strive to reach 100% of theswitching of standard plastic bags to recycledplastic bags.
55%70%
Carbon ef?ciency will beimproved by 55% in2030 compared to 2021
Carbon footprint of eachparcel will be reduced by 70%in 2030 compared to 2021
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
About the ReportThis is the fifth annual sustainability report issued by S.F. Holding Co., Ltd.. Adhering to the principles of balance, comparability,accuracy, timeliness, clarity and reliability, this report discloses the management measures and effectiveness of S.F. Holding Co.,Ltd. in terms of sustainable development.Report Title
For the convenience of expression and reading, “SF”, “the Company”, “we” and “the Group” in this Report all refer to “S.F. Holding Co., Ltd.”.Time RangeThis report covers the period from 1 January 2023 to 31 December, 2023.Reporting ScopeThe reporting scope of this Report on general disclosure and management of material issues, and social key performance indicators is consistentwith 2023 SF Annual Report, including S.F. Holding Co., Ltd. and its major subsidiaries in the People’s Republic of China and other regions includingthe United States, South Korea, Singapore, and Malaysia. To ensure data reliability and properly and thoroughly reflect the Company’s overallenvironmental performance, the Company will continue to improve data coverage and calculation processes for environmental performance indicators.If this report includes further explanations on the coverage of specific information, those explanations will take precedence.Reference and PrinciplesSF created this Report using systematic procedures including research and interviews, the identification of important stakeholders and material issuesrelated to ESG, and its understanding of stakeholder opinions. The procedures also include the determination of material issues, the scope of ESGdisclosure, and the collection and review of relevant information. SF prepared the Report based on collected relevant information and review andapproval by the Board of Directors.The preparation basis referred to in the Report includes:
? Environmental, Social and Governance Reporting Guide in Appendix C2 to the Rules Governing the Listing of Securities on the Stock Exchangeof Hong Kong Limited? Shenzhen Stock Exchange Social Responsibility Instructions to Listed Companies 《深圳证券交易所上市公司社会责任指引》? Guidelines for Sustainability Reporting Standards (GRI Standards) of the Global Sustainability Standards Board (GSSB)? Task Force on Climate-Related Financial Disclosure (TCFD)? Sustainability Accounting Standards Board (SASB) of Sustainability Accounting Standards Board Committee? United Nations Sustainable Development Goals (SDGs)? Key indicators of corporate environmental, social, and governance performance by capital market rating agencies.
Appendix
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
Reporting principlesThis Report responds to and follows the reporting principles of the Environmental, Social and Governance Reporting Guide, including materiality,quantitative, consistency and balance. The following table describes the Company’s application of the reporting principles:
PrinciplesResponses of the Company
Materiality
In 2023, SF analyzed and evaluated important issues related to the company’s operation through thesubstantive issues survey questionnaire and submit them to the senior management of SF Express forreview and approval. We used the results of the ranking of issues of importance in 2023 as the basis forthis report.Quantitative
The report discloses SF’s key quantitative performance indicators and sets quantitative performancetargets where applicable. The calculation criteria, methods, assumptions and/or calculation tools for allquantitative indicators have been described in their respective locations.Consistency
Unless otherwise indicated, the information selection, preparation and presentation of this reportremain consistent with previous years. If there are material changes that could affect comparisons withprevious years’ reports, we have indicated them in the appropriate location.Balance
This report is based on objective information and facts, and fairly discloses positive and negativeinformation about the company to prevent descriptions or reporting formats that may affect readers’decisions or judgments.Meanwhile, the Report responds to and follows the reporting principles of the GRI standard. The following table is the Company’s explanation of theapplication of the reporting principles:
PrinciplesResponses of the Company
Accuracy
The Report has been carefully reviewed to report accurate and detailed information to ensure theaccuracy of the disclosed data.Clarity
The Report is written in a way that is easy for readers to understand, presenting information in anaccessible manner.CompletenessThe Report fully discloses all the materiality issues identified by the Company in 2023.Sustainability ContextThe Report discloses information about the Company in the context of broad sustainability.Timeliness
The Company discloses the ESG Report every year and releases it at the same time as the annual Reportto provide readers with timely reference for decision-making.VerifiabilityThe data collected, recorded, compiled and analyzed in the Report may be reviewed to ensure quality.
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
Information Explanation
In 2023, SF conducted ESG management for Kerry Logistics Network Limited. During the Reporting Period, SF completed the integration ofenvironmental indicator data of Kerry Logistics Network Limited (see Appendix “Key Performance – Environment” for details).In March 2024, SF successfully passed the audit by SGS-CSTC Standards Technical Services CO., LTD., an international independent third-party auditorganization. The Company completed the third-party verification of greenhouse gas emissions of 2023 and obtained the certificate of greenhousegas accounting.
For the monetary amounts stated in the Report, unless otherwise stated, the currency in the Report is denominated in RMB.This Report is published in both Chinese and English. If there is any discrepancy between the Chinese version and the English version, the Chineseversion shall prevail.Release of this ReportThis Report was approved and released by the Board on 27 March 2023 after confirmation by the management. The sustainability report of SF isreleased annually at the same time as the annual financial report.Accessibility of this ReportYou can obtain the electronic version of this Report from the following website: SF’s official website https://www.sf-express.comFor further consultation, or to offer any opinion or suggestion about this Report, please contact the Company via sfir@sf-express.com.
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
Assurance statement
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
Policy ListChapterChapter name
Compliance with the main laws and
regulations
Main internal system of SF
Governance
StandardizingCorporateGovernance
“Code of Corporate Governance for ListedCompanies”“Rules Governing the Listing of Stocks on theShenzhen Stock Exchange”“Company Law of the People’s Republic ofChina”“Criminal Law of the People’s Republic ofChina”“Securities Law of the People’s Republic ofChina”
“Rules of Procedure for Risk Management Committee ofthe Board of Directors”“Rules of Procedure for Audit Committee of the Board ofDirectors”“Rules of Procedure for Nomination Committee of theBoard of Directors”“Rules of Procedure for Remuneration and AppraisalCommittee of the Board of Directors”“Rules of Procedure for Board of Directors”“Rules of Procedure for Strategy committee of the Boardof Directors”“Work System for Independent Directors”“Rules of Procedure for General Meeting”“Rules of Procedure for Supervisory Committee”“Articles of Association of SF Holdings Co., Ltd.”“Investor Relations Management System”“Information Disclosure Management System”StrengtheningRisk ControlManagement
“Law of PRC on Countering UnfairCompetition”“Anti-monopoly Law of the People’s Republicof China”“Basic Standards for Enterprise InternalControl”
“Management System of Company Risk Control”“Operation Rules of the Risk Committee”“Risk Control Compliance Management System of theGroup”“Risk Event Management System of the Group”“Crisis Management System of the Group”
Abiding byBusiness Ethics
“Anti-Money-Laundering Law”“Trademark Law of the People’s Republic ofChina”“Audit Law of the People’s Republic of China”“Patent Law of the People’s Republic of China”“Interim Provisions on Banning CommercialBribery”“Accounting Standards for Business Enterprises– Application Guide”“Provisions of the Audit Commission oninternal audit work”
“Integrity Handbook”“Anti-corruption Management System”“Rewards and Penalty Management Regulations”“Reporting Management Measures”“Operation Guidelines for Handling InfringementIncidents”“Administrative Measures for Relatives and BiddingAvoidance”“Trademark (Trade Name) Management System”“Employee Communication Management Regulations”“Patent (Software Copyright) Management System”EnsuringInformationSecurity
“Personal Information Protection Law of thePeople’s Republic of China”“Data Security Law of the People’s Republic ofChina”“Cyber Security Law of the People’s Republicof China”
“Information Security Incident Management Provisions”“Privacy Data Security Compliance ManagementStandards”“Employee Information Security Manual”
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
ChapterChapter name
Compliance with the main laws and
regulations
Main internal system of SF
Environment
Creating GreenLogistics
“Method and Criteria for Green PackagingAssessment”“Limitation of Excessive Packaging for ExpressDelivery”
“SF Aviation Energy Management System (Provisional)”“Administrative Measures for Updating and Disposing ofOperational Vehicles”“Regulations on the Administration of Operational VehiclesPut into Use”“Lump-sum Oil Consumption Plan for Commercial Vehicles”“Regulations on the Administration of Water andElectricity in the Parks”“Management Guide for Maintenance of Industrial ParkFacilities and Equipment”“Industrial Park Property Service Standards”“SF Packaging Code of Practice”PromotingCircularEconomy
“Circular Economy Promotion Law of thePeople’s Republic of China”
No relevant internal management system
Protecting theEnvironment
“Forestry Law of the People’s Republic ofChina”“Regulations for the Implementation ofForestry Law of the People’s Republic ofChina”“Regulations of the People’s Republic of Chinaon Wild Plants Protection”
No relevant internal management system
Green Office
“Air Pollution Prevention and Control Law ofthe People’s Republic of China”“Law of the People’s Republic of China onthe Prevention and Control of EnvironmentalPollution by Solid Waste”“Law of the People’s Republic of China onthe Prevention and Control of Ambient NoisePollution”“Energy Conservation Law of the People’sRepublic of China”“Water Law of the People’s Republic of China”“Water Pollution Control Act of People’sRepublic of China”“Soil Pollution Prevention and Control Law ofthe People’s Republic of China”“Integrated Emission Standard of AirPollutants”“Emission Standards for Odor Pollutants”“Emission Standard for Industrial EnterprisesNoise at Boundary”“Standard for Noise Limits at the Boundary ofConstruction Plants”“Self-monitoring technology guidelines forpollution sources – General rule”“Regulation on the Administration ofPermitting of Pollutant Discharges”“Comprehensive Wastewater DischargeStandard”“Standard for pollution control on the non-hazardous industrial solid waste storage andlandfill”(GB 18599-2001)“Guidelines for the Investigation of SoilPollution Hazards in Key Regulatory Units(Trial)”
“Measures for Office Space Management”“Energy Metering Management System”“Dangerous Goods Management Procedure”“Measures for the Administration of Water and Electricityof Property Sites”
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
ChapterChapter name
Compliance with the main laws and
regulations
Main internal system of SF
Society
Empowering theTalent Team
“Labor Law of the People’s Republic of China”“Labor Contract Law of the People’s Republicof China”“Regulations for the Implementation of theIndividual Income Tax Law of the People’sRepublic of China”“Law of the People’s Republic of China onTrade Unions”“Employment Promotion Law of the People’sRepublic of China”“Law of the People’s Republic of China on theProtection of Women’s Rights and Interests”“Social Insurance Law of the People’s Republicof China”“Regulation on Work-Related Injury Insurance”“Provisions on the Prohibition of Using ChildLabor”“Special Rules on the Labor Protection ofFemale Employees”“Regulations on Paid Leave for Employees”
“Contractor regulations”“Work Guideline on Handling of Employees’ Demandsthrough Labor Union”“Labor Union Hotline Service Quality ImprovementMechanism”“Reasonable Suggestion Management Mechanism”“Rewards and Penalty Management Regulations”“Administrative Measures for Relatives and BiddingAvoidance”“Talent Management System”“Talent Promotion Management System”“Sf send you to University Project Management Methods”“Complete-Process Management Mechanism for Demands”“Plan for Whole-Process Quality Improvement of Demand”“Retirement and reemployment management methods”“Management measures for the transfer of first- andsecond-line employees”“First- and second-line employees diversified developmentof key positions within the employment issued standardrequirements”Employee “Welfare Management System”“Operation Instruction Manual for Employee Care”“Work Guidelines for Conversing Employee Voice intoProductivity”“Employee Handbook”“Information disclosure guidelines for employees”“Recruitment Management System”
Building theLine of Safety
“Work Safety Law of the People’s Republic ofChina”“Special Equipment Safety Law of the People’sRepublic of China”“Fire Protection Law of the People’s Republicof China”“the Law of People’s Republic of China onPrevention and Control of OccupationalDiseases”“Requirement and Guidelines for OccupationalHealth and Safety Management Systems”“Regulations on emergency response toproduction safety accidents”“Regulations on the administration of safeproduction of construction projects”
“Safety education and training management provisions”“Safety assessment and incentive management provisions”“Safety production target responsibility statement”“Comprehensive emergency plan for work safety”“Regulations on safety management of vehicle operationin yard”“Safety Management Protocol for road Cargo Transportservices”“Regional risk control list”“Standard for safe operation of post”“Notice on Regularly Carrying out Hazard SourceIdentification and Evaluation and Improving theConstruction of Dual Prevention System”“Express fire emergency handling operation guide”“the Competence Evaluation and Training ManagementProcedure”“Production safety risk assessment standards”“Production Safety Risk Assessment Standards andQuantitative Suggestions”“Safety Production Management Manual”“Production Safety System Evaluation Standards andFramework”“Production Safety System Evaluation Guide”“Production Safety Hazard Identification Control List”“SF Safety Production Management Manual”“Procedures on Hazard Source Identification, RiskAssessment, and Control Management”“Logistics supplier safety management provisions”“Logistics handling and sorting services securitymanagement protocol”“Related Party Safety Management Procedures’“Emergency Plan Management Regulations”“Emergency Preparation and Response ManagementProcedure”“Workplace safety management standardizationimprovement action plan”“Workplace safety management standardizationimprovement action plan”
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
ChapterChapter name
Compliance with the main laws and
regulations
Main internal system of SF
BuildingResponsibleChain Together
“E-Commerce Law of the People’s Republic ofChina”“Contract Law of the People’s Republic ofChina”“The Bidding Law of the People’s Republic ofChina”“Regulation on the Implementation of theBidding Law of the People’s Republic of China”
“Management Regulations on Procurement Risk”“Regulations on the Management of Purchasing Staff”“Regulations on Green Procurement Management ofProcurement Supply Chain Center”“Management Regulations on Procurement Suppliers”“Supplier Penalty Management Measures”“Letter of Notification of Transparent Procurement”ShoulderingSocialResponsibility
“Charity Law of the People’s Republic ofChina”
“Articles of Association of SF Charity Foundation”“Management System of SF Charity Foundation VolunteerAssociation”
Service
Creating SmartLogistics
No relevant laws and regulationsNo relevant internal management systemInnovation-DrivenDevelopment
No relevant laws and regulationsNo relevant internal management system
Securing SafetyDelivery
“Postal Law of the People’s Republic of China”
“Measures for the Administration of the
Real-Name Receipt and Delivery of Mails and
Express Mails”
“Supervision and Administration of Security of
the Postal Industry”
“Measures for the Supervision and
Administration of the Delivery Safety of the
Postal Industry”
“Provisions on Articles Prohibited from
Delivery”
“Operation Specification in Safety Production
of Express Service”
“Common Standards for Receiving Consignments”“Regulations on Operation and Management of Battery-Contained Parcels”“Guidelines for Emergency Handling of Dangerous Goodson Board”“Provisions on the Management of “Three Systems” forDelivery Safety”“Provisions on the Administration of ProhibitedConsignments”“Operation Procedures for Real-Name Pickup and Delivery”“Pickup and Delivery Inspection System”“Dangerous Goods Transportation Manual”“Special Plan for the Control of Illegal and ProhibitedArticles”“Regulations on the Management of “Three Systems” forMails and Shipments”“Reward Management Measures for Self-Inspection ofIllegal and Prohibited Articles”“Reward Mechanism for Self-Inspection of Illegal andProhibited Articles”
DeliveringPremiumServices
No relevant laws and regulations
“Reasonable Suggestion Management Mechanism”“Reward and Punishment Rules for Customer Service”“Differentiated Customer Services”“Customer Voice Classification Standard”“Customer Experience Customer Service Operation Process”“Measures on the Acceptance of Customer Complaints”“Administrative Measures for Claims Settlement”“Abnormality Handling Mechanism for Time-EffectiveCategory”“Complaint Handling Procedure”“Complaint Handling Upgrade Mechanism”“Guidelines for the Control of Internet Public Opinions andComplaints”“Abnormal Event Customer Service Process”“Emergency Response Capacity System”
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
Key PerformanceTable of Environmental Key Performance
Indicator – EnvironmentUnit
20222023SFKLNTotalSFKLNTotalGHG emissions
GHG emissions
Total GHG emissionstCO
e9,185,355.12,472,955.011,658,310.18,748,710.72,451,355.011,200,065.7Scope 1tCO
e3,143,752.0322,253.03,466,005.02,652,365.1221,739.02,874,104.1Scope 2tCO
e1,804,248.580,543.01,884,791.51,465,521.8 79,916.01,545,437.8Scope 3
tCO
e4,237,354.62,070,159.06,307,513.64,630,823.82,149,700.06,780,523.8Category 1: Purchased goodsand services
tCO
e2,522,391.5N/A2,522,391.5775,202.1N/A775,202.1Category 3: Fuel and energy-related activities
tCO
e1,689,195.7N/A1,689,195.71,754,182.2N/A1,754,182.2Category 4: Upstreamtransportation anddistribution
tCO
eN/A2,070,159.02,070,159.02,073,065.92,149,700.04,222,765.9Category 5: Waste generatedin operations
tCO
e1,492.1N/A1,492.13,303.1N/A3,303.1Category 7: Employeecommuting
tCO
e24,275.3N/A24,275.325,070.6N/A25,070.6
TheCompanycontinuestoimprovethestatisticsoftheemissiondataofthecategoriesofGHGemissionsScope3.In2023,theemissionsofScope3Categories2,6,12and15arenotapplicabletothemainbusinessoperationscenariosofSF,andthereforearenotpresentedinthetableofenvironmentalkeyperformance.
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
Indicator – EnvironmentUnit
20222023SFKLNTotalSFKLNTotalGHG emission intensity
tCO
e/millionrevenue(RMB)
47.633.143.5 41.1 53.5 43.3GHG emissions per parcel
g CO
e/parcel
824.5N/A824.5730.9 N/A730.9GHG removal from newly planted treestCO
eN/A6.06.04.69.013.6EmissionNitrogen oxide emissionston25,555.52,416.027,971.527,246.41,907.029,153.4Sulfur oxide emissionton20.66.026.618.23.021.2Particle emissionston2,087.3156.02,243.32,021.2118.02,139.2Energy consumption
Non-renewableenergyconsumption
Total gasoline consumptionMWh18,546,599.71,673,098.020,219,697.717,506,785.11,005,665.0 18,512,450.1Gasoline consumptionMWh1,100,111.115,339.01,115,450.11,394,864.513,424.01,408,288.5Diesel consumptionMWh12,590,526.51,035,410.013,625,936.510,681,630.0780,440.011,462,070.0Aviation keroseneconsumption
MWh4,855,962.1N/A4,855,962.15,430,290.5N/A5,430,290.5Natural gas consumptionMWhN/A1,410.01,410.0N/A909.0909.0Consumption of liquefiedpetroleum gas
MWhN/A2,808.02,808.0N/A2,112.02,112.0Compressed natural gasMWhN/A614,100.0614,100.0N/A204,405.0204,405.0Gas and oil consumptionMWhN/A4,031.04,031.0N/A4,375.04,375.0Renewableenergy
Total energy consumptionMWh7,271.2901.08,172.215,712.01,402.017,114.0Solar energyMWh7,271.2768.08,039.215,712.01,378.017,090.0Hydropower
MWhN/A133.0133.0N/A24.024.0Indirect energyconsumption
Electricity consumptionMWh1,840,522.7164,389.02,004,911.72,100,998.5167,799.02,268,797.5
The GHG emissions per parcel are calculated from the total GHG emissions and the total parcel volume during the reporting period, which does not include the parcelvolume of Kerry Logistics Network Limited express delivery business in overseas countries. In addition, this indicator is not applicable to Kerry Logistics due to differencesin business forms.
Due to the differences in the business forms of SF and Kerry Logistics Network Limited, some of the indicators in Non-renewable Energy Consumption are not applicable
and are therefore presented as N/A in this environmental key performance table.
This indicator is not applicable to SF due to differences in business forms.
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
Indicator – EnvironmentUnit
20222023SFKLNTotalSFKLNTotal
Total sold energyMWh74.8657.0731.857.2479.0536.2Total energy consumptionMWh20,394,318.81,837,731.022,232,049.819,623,438.41,174,387.020,797,825.4Energy consumption intensity
MWh/millionrevenue(RMB)
105.824.683.192.325.680.5Use of water resourcesWater withdrawal
ton1,423,452.01,169,181.02,592,633.01,601,051.41,042,625.02,643,676.4WasteNon-hazardous waste productionkg46,096,330.928,442,000.074,538,330.9155,214,609.720,113,000.0175,327,609.7Hazardous waste productionkgN/A142,000.0142,000.0N/A
54,000.054,000.0
Packaging materials
Use ofpackagingitems
Total use of packaging itemskg445,093,236.0
9,203,000.0454,296,236.0
477,113,830.45,672,000.0482,785,830.4Express envelopekg75,219,380.073,959,992.9N/A73,959,992.9Waybillkg17,620,130.414,257,402.5N/A14,257,402.5Cartonkg241,291,360.0266,797,554.74,539,000.0271,336,554.7Plastic bagskg41,596,926.651,729,610.91,100,000.052,829,610.9Scotch tapeskg28,412,018.026,013,021.8N/A26,013,021.8Foaming type of fillerskg12,814,718.212,884,490.833,000.012,917,490.8Inflatable type of fillerskg28,138,702.831,471,756.8N/A31,471,756.8Table of Social Key Performance
Indicator-SocietyUnit2022
2023
Employment
Number of workforcesTotal workforcePerson743,377746,577By gender
MalePerson623,980627,408FemalePerson119,397119,169
The Company’s water sources are all municipal water, and the statistical data is based on the total amount of water withdrawn. Therefore, adjustments have been madeto the indicators disclosed in previous years’ report.
SF’s own operations do not involve the generation of large quantities of hazardous waste, and hazardous waste in the office has not yet been accounted for.
Due to the differences in the business forms of SF and Kerry Logistics Network Limited, some of the indicators in the usage of packaging items are not applicable and aretherefore presented as N/A in this environmental key performance table.
As the statistical scope of SF’s social performance data in 2023 is the same as the scope of disclosure in the Annual Report, the Company has retrospectively adjusted the
social performance data disclosed in 2022 to include Kerry Logistics in the scope of SF’s statistics and disclosure to provide continuity and comparability between the 2022and 2023 data.
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
Indicator-SocietyUnit2022
2023By age
Aged below 30Person244,875226,221Aged 30-50Person485,308508,251Aged over 50Person13,19412,105
By educational background
DoctoratePerson65 57Master degreePerson4,143 4,068Bachelor’s degreePerson55,364 57,302Associate’ degreePerson131,760 137,996High school and belowPerson552,045 547,154By job functions
Management personnelPerson25,374 26,025Professional personnelPerson47,804 43,725Operations personnelPerson670,167 676,827By employment type
Full-timePerson630,072 647,728Part-timePerson113,305 98,849Number of newly recruited workforcesPerson323,493 305,817Workforce turnoverTotal number of workforces departedPersons142,540122,037Workforce turnover rate
%19.216.3By gender
Male%18.615.9Female%22.218.7By age
Aged below 30%30.926.4Aged 30-50%13.612.1Aged over 50%7.27.4
Workforces turnover rate = Total departures ÷ Total workforces
Turnover rate of workforces by category = Number of departures by category ÷ Number of workforces by category
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
Indicator-SocietyUnit2022
2023Diversified employmentNumber of newly recruited female workforcesPerson61,60653,894Health and SafetyMajor express fire accidentsAccident00Major site first and second level fire accidentsAccident00Signing rate of contractor safety management agreement%100100Safety training coverage%100100Lost time injury rate
Per million hoursworked
1.76 2.35
Number of aviation accidentsPiece00Training and developmentNumber of trained workforcesTotal number of trained workforcesPerson728,201724,277Percentage of trained workforces%98.0 97.0By gender
Male%84.284.5Female%15.8 15.5
Total training hours
Average training hours per trained workforcesHour6.0 7.8By gender
MaleHour5.9 7.8FemaleHour6.1 7.9
Lost-time injury rate = Number of lost man-hours accidents ÷ Number of actually hours worked × 1,000,000
Percentage of trained workforces by category = Number of trained workforces by category ÷ Total number of trained workforces
Average training hours per trained workforces by category = Total training hours by category ÷ Number of trained workforces by category
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
Indicator-SocietyUnit2022
2023Supply chain managementTotal number of suppliersCompany12,41410,932By region
Mainland ChinaCompany11,72810,271Hong Kong, Macao andTaiwan
Company16951OverseasCompany517519Number of new suppliersCompany3,830 2,766Product ResponsibilityIntellectual PropertyNumber of patents grantedPatent1,8512,002Number of new patents granted annuallyPatent221247Number of software copyrights acquiredCopyright2,4492,490Number of new software copyrights acquired annuallyCopyright480285Anti-corruptionAnti-corruption trainingNumber of employees involved in anti-corruption trainingPerson67,893121,701Total hours of anti-corruption trainingHour32,336 70,073Community investmentDonations to community activitiesRMB118,845,372105,900,635Community activity expenses (excluding donations)RMB935,1691,008,576
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
Indicator IndexGRI Standard Content IndexInstructions
SF referred to the GRI standards for preparation of the Report covering the period from January 1, 2023,to December 31, 2023.Use of GRI 1GRI 1: Foundation 2021GRI StandardIndicator No.
GRI Standard IndicatorLocation/NoteGRI 2: General Disclosure 2021
2-1Organizational detailsAbout SF2-2Entities included in the organization’s sustainability reportingReporting Scope2-3Reporting period, frequency and contact pointTime Range2-4Restatements of informationInformation Explanation2-5External assuranceExternal Audit Statement2-6Activities, value chain and other business relationshipsAbout SF2-7EmployeesTable of Social Key Performance Index2-8Workers who are not employeesTable of Social Key Performance Index2-9Governance structure and compositionStandardizing Corporate Governance2-10Nomination and selection of the highest governance bodyStandardizing Corporate Governance2-11Chair of the highest governance bodyStandardizing Corporate Governance2-12
Role of the highest governance body in overseeing the managementof impacts
Standardizing Corporate Governance2-13Delegation of responsibility for managing impactsStandardizing Corporate Governance2-14Role of the highest governance body in sustainability reportingESG Governance System2-15Conflicts of interestAnti-Corruption management2-16Communication of critical concernsCommunication with Stakeholders2-17Collective knowledge of the highest governance body
ESG Management Policies and
Strategies2-18Evaluation of the performance of the highest governance bodyESG Goal Setting and Progress Review2-19Remuneration policiesESG Goal Setting and Progress Review2-20Process to determine remunerationESG Goal Setting and Progress Review
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
GRI StandardIndicator No.
GRI Standard IndicatorLocation/Note
2-21Annual total compensation ratio
Due to the confidentiality ofinformation, it is not publicly disclosed2-22Statement on sustainable development strategy
ESG Management Policies andStrategies2-23Policy commitments
Protection of Employees’ Rights andInterests2-24Embedding policy commitments
Protection of Employees’ Rights andInterests2-25Processes to remediate negative impacts
Protection of Employees’ Rights andInterests2-26Mechanisms for seeking advice and raising concerns
Protection of Employees’ Rights andInterests2-27Compliance with laws and regulationsIntegrity Management System2-28Membership associations
Management of TechnologicalInnovation2-29Approach to stakeholder engagementCommunication with Stakeholders2-30Collective bargaining agreements
Protection of Employees’ Rights andInterestsGRI 3: Materiality topics 20213-3Management of material topics
Process of Assessing Materiality IssuesAnalysis Result of Materiality Issues3-1The process of identifying material topicsAnalysis Result of Materiality Issues3-2List of material topicsAnalysis Result of Materiality Issues3-3Management of material topicsAnalysis Result of Materiality Issues
GRI 201: Economic Performance 2016
3-3Management of material topics
Please refer to the Company’s AnnualReport201-1Direct economic value generated and distributed
Please refer to the Company’s AnnualReport201-2
Financial implications and other risks and opportunities due toclimate change
Physical riskTransition riskClimatic opportunity201-3Defined benefit plan obligations and other retirement plansEmployee Welfare and Care201-4Financial assistance received from government
Please refer to the Company’s AnnualReport
GRI 202: Market Presence 2016
3-3Management of material topics
Please refer to the Company’s AnnualReport202-1
Ratios of standard entry level wage by gender compared to localminimum wage
Due to the confidentiality ofinformation, it is not publicly disclosed202-2The percentage of executives hired from the local community
Due to the confidentiality ofinformation, it is not publicly disclosed
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
GRI StandardIndicator No.
GRI Standard IndicatorLocation/NoteGRI 203: Indirect Economic Impacts 20163-3Management of material topics
Please refer to the Company’s AnnualReport203-1Infrastructure investments and services supported
Accelerating “Express Delivery toVillages” to Promote Regional EconomicDevelopment
203-2Significant indirect economic impacts
Unblocking channels for the circulationof agricultural products and boostingrural revitalizationBuilding a Sustainable Production-distribution Ecosystem to Promote RuralIndustry DevelopmentFacilitating the Flows of AgriculturalProducts to Help Revitalize Rural AreasGRI 204: Procurement Practices 20163-3Management of material topics
Supplier Management SystemBuilding the Sustainable Supply Chain204-1Proportion of spending on local suppliers
Due to the confidentiality ofinformation, it is not publicly disclosedGRI 205: Anti-corruption 20163-3Management of material topics
Integrity Management systemAnti-Corruption management205-1Operations assessed for risks related to corruptionAnti-Corruption management205-2
Communication and training about anti-corruption policies andprocedures
Anti-Corruption management205-3Confirmed incidents of corruption and actions takenAnti-Corruption managementGRI 206: Anti-competitive Behavior 2016
3-3Management of material topicsRisk Management Practice206-1
Legal actions for anti-competitive behavior, anti-trust, andmonopoly practices
Abiding by Business Ethics
GRI 207: Tax 2016
3-3Management of material topics
Please refer to the Company’s Annual
Report207-1Approach to tax
Please refer to the Company’s Annual
Report207-2Tax governance, control, and Risk Management
Please refer to the Company’s Annual
Report207-3
Stakeholder engagement and management of concerns related totax
Please refer to the Company’s Annual
Report
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
GRI StandardIndicator No.
GRI Standard IndicatorLocation/Note207-4Country-by-country reporting
Please refer to the Company’s AnnualReportGRI 301: Materials 2016
3-3Management of material topicsSustainable Packaging R&D301-1Materials used by weight or volume
Sustainable Packaging R&DTable of Environmental KeyPerformance Index301-2Recycled input materials usedSustainable Packaging R&D301-3Reclaimed products and their packaging materialsSustainable Packaging R&D
GRI 302: Energy 20163-3Management of material topics
Optimizing Environmental ManagementSystemPromote Low-carbon TransportationEnergy management302-1Energy consumption within the organization
Table of Environmental KeyPerformance Index302-2Energy consumption outside of the organization
Table of Environmental KeyPerformance Index302-3Energy intensity
Table of Environmental KeyPerformance Index302-4Reduction of energy consumption
Promote Low-carbon TransportationBuilding Green Industrial ParksEnergy management302-5Reductions in energy requirements of products and services
Promote Low-carbon TransportationPromoting Circular Economy
GRI 303: Water and Effluents 2018
3-3Management of material topics
Building Green Industrial ParksWater Resources Management303-1Interactions with water as a shared resource
Building Green Industrial ParksWater Resources Management303-2Management of water discharge related impacts
Building Green Industrial ParksWater Resources Management303-3Water withdrawal
Water Resources ManagementTable of Environmental KeyPerformance Index303-4Water dischargeManagement of Water Resources303-5Water consumption
It is not applicable to the Company’sbusiness operation scenarios
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
GRI StandardIndicator No.
GRI Standard IndicatorLocation/NoteGRI 304: Biodiversity 2016
3-3Management of material topicsProtecting the Environment304-1
Operational sites owned, leased, managed in, or adjacent to,protected areas and areas of high biodiversity value outsideprotected areas
SF Forest304-2Significant impacts of activities, products and services on biodiversitySF Forest304-3Habitats protected or restoredSF Forest304-4
IUCN Red List species and national conservation list species withhabitats in areas affected by operations
Not applicable, the habitat in the area
affected by the Company’s operations
does not contain species that have been
listed on the IUCN Red List and the
National Conservation Register
GRI 305: Emissions 20163-3Management of material topics
Promoting Low-carbon Transportation
Building Green Industrial Parks
Sustainable Packaging R&D
Exhaust & Noise management305-1Direct (Scope 1) GHG emissions
Table of Environmental Key
Performance Index305-2Energy indirect (Scope 2) GHG emissions
Table of Environmental Key
Performance Index305-3Other indirect (Scope 3) GHG emissions
Table of Environmental Key
Performance Index305-4GHG emissions intensity
Carbon Reduction Initiatives and
Effectiveness
Table of Environmental Key
Performance Index305-5Reduction of GHG emissions
Carbon Reduction Initiatives and
Effectiveness
Sustainable Packaging R&D305-6Emissions of ozone-depleting substances (ODS)
It is not applicable to the Company’s
business operation scenarios305-7
Nitrogen oxides (NOx), sulfur oxides (SOx), and other significant airemissions
Table of Environmental Key
Performance Index
GRI 306: Waste 2020
3-3Management of material topics
Recycle and recycle express packaging
Waste management306-1Waste generation and significant waste-related impactsWaste management306-2Management of significant waste-related impactsWaste management
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
GRI StandardIndicator No.
GRI Standard IndicatorLocation/Note306-3Waste generated
Table of Environmental KeyPerformance Index306-4Waste diverted from disposalWaste management306-5Waste directed to disposalWaste management
GRI 308: Supplier Environmental Assessment 20163-3Management of material topics
Supplier Management SystemBuilding the Sustainable Supply Chain308-1New suppliers that were screened using environmental criteria
Supplier Management SystemBuilding the Sustainable Supply Chain308-2
Negative environmental impacts in the supply chain and actionstaken
Supplier Management SystemBuilding the Sustainable Supply ChainGRI 401: Employment 20163-3Management of material topics
Protection of Employees’ Rights andInterestsEmployee Care and Welfare401-1New employee hires and employee turnoverTable of Social Key Performance401-2
Benefits provided to full-time employees that are not provided totemporary or part-time employees
Employee Care and Welfare401-3Parental leaveEmployee Care and WelfareGRI 402: Labor/Management Relations 20163-3Management of material topics
Protection of Employees’ Rights and
Interests402-1Minimum notice periods regarding operational changes
Protection of Employees’ Rights and
Interests
GRI 403: Occupational Health and Safety 2018
3-3Management of material topics
Safety Management System
Safety Management Measure
Employee Care and Welfare403-1Occupational health and safety management systemSafety Management System403-2
Hazard source identification, risk assessment, and incidentinvestigation
Safety Management Measure403-3Occupational health services
Safety Management Measure
Employee Care and Welfare403-4
Worker participation, consultation, and communication onoccupational health and safety
Safety Management System
Safety Management Measure
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
GRI StandardIndicator No.
GRI Standard IndicatorLocation/Note403-5Worker training on occupational health and safetySafety Management Measure403-6Promotion of worker healthEmployee Care and Welfare403-7
Prevention and mitigation of occupational health and safety impactsdirectly linked by business relationships
Safety Management Measure403-8
Workers covered by an occupational health and safety managementsystem
Safety Management System403-9Work-related injuriesTable of Social Key Performance403-10Work-related ill healthTable of Social Key Performance
GRI 404: Training and Education 2016
3-3Management of material topicsConstruction of Talent Team404-1Average hours of training per year per employee
Construction of Talent Team
Table of Social Key Performance404-2
Programs for upgrading employee skills and transition assistanceprograms
Construction of Talent Team404-3
Percentage of employees receiving regular performance and careerdevelopment reviews
Construction of Talent TeamGRI 405: Diversity and Equal Opportunity 20163-3Management of material topics
Protection of Employees’ Rights and
Interests405-1Diversity of governance bodies and employees
Corporate Governance Protection of
Employees’ Rights and Interests
Table of Social Key Performance405-2Ratio of basic salary and remuneration of women to men
Due to the confidentiality of
information, it is not publicly disclosed
GRI 406: Non-discrimination 2016
3-3Management of material topics
Protection of Employees’ Rights and
Interests406-1Incidents of discrimination and corrective actions taken
Protection of Employees’ Rights and
Interests
GRI 407: Freedom of Association and Collective Bargaining 2016
3-3Management of material topics
Protection of Employees’ Rights and
Interests407-1
Operations and suppliers in which the right to freedom ofassociation and collective bargaining may be at risk
Protection of Employees’ Rights and
Interests
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
GRI StandardIndicator No.
GRI Standard IndicatorLocation/NoteGRI 408: Child Labor 20163-3Management of material topics
Protection of Employees’ Rights andInterests408-1
Operations and suppliers at significant risk for incidents of childlabor
Protection of Employees’ Rights andInterestsSupplier Management SystemGRI 409: Forced or Compulsory Labor 20163-3Management of material topics
Protection of Employees’ Rights andInterests409-1
Operations and suppliers at significant risk for incidents of forced orcompulsory labor
Protection of Employees’ Rights andInterestsSupplier Management SystemGRI 413: Local Communities 20163-3Management of material topics
Educational CharityMedical Care413-1
Operations with local community engagement, impact assessments,and development programs
It is not applicable to the Company’sbusiness operation scenarios413-2
Operations with significant actual and potential negative impactson local communities
It is not applicable to the Company’sbusiness operation scenarios
GRI 414: Supplier Social Assessment 2016
3-3Management of material topics
Supplier Management SystemBuild the Sustainable Supply Chains414-1New suppliers that were screened using social criteria
Supplier Management SystemBuilding Sustainable Supply Chains414-2Negative social impacts in the supply chain and actions taken
Supplier Management SystemBuild the Sustainable Supply Chains
GRI 416: Customer Health and Safety2016
3-3Management of material topics
Real-name Authentication ManagementManagement of Illegal and ProhibitedArticlesDangerous Goods Transportation416-1
Assessment of the health and safety impacts of product and servicecategories
Real-name Authentication ManagementManagement of Illegal and ProhibitedArticlesDangerous Goods Transportation
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
GRI StandardIndicator No.
GRI Standard IndicatorLocation/Note416-2
Incidents of non-compliance concerning the health and safetyimpacts of products and services
Real-name Authentication ManagementManagement of Illegal and ProhibitedArticlesDangerous Goods Transportation
GRI 417: Marketing and Labeling 20163-3Management of material topicsEnhancing Customer Experience417-1Requirements for product and service information and labelingEnhancing Customer Experience417-2
Incidents of non-compliance concerning product and serviceinformation and labeling
There were no violations involvingproduct and service information andlogos in SF in 2023.417-3Incidents of non-compliance concerning marketing communications
There were no violations involvingmarketing communications in SF in2023.GRI 418: Customer Privacy 20163-3Management of material topics
Ensuring Information SecurityCustomer Privacy Protection418-1
Substantiated complaints concerning breaches of customer privacyand losses of customer data
Ensuring Information SecurityEnhancing Customer ExperienceSustainability Accounting Standards Board Index (SASB Content Index)
Sustainability Disclosure Topics & Accounting Metrics
TopicAccounting MetricCategoryCodeLocation
Greenhouse GasEmissions
Gross global Scope 1 emissionsQuantitativeTR-AF-110a.1
Table of Environmental KeyPerformanceDiscussion of long-term andshort-term strategy or planto manage Scope 1 emissions,emissions reduction targets,and an analysis of performanceagainst those targets
Discussion andAnalysis
TR-AF-110a.2
Climate-relatedInformation DisclosuresFuel consumed by (1) roadtransport, percentage (a)natural gas and (b) renewable,and (2) air transport,percentage (a) alternative and(b) sustainable
QuantitativeTR-AF-110a.3
Promote Low-carbonTransportationTable of Environmental KeyPerformance
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
TopicAccounting MetricCategoryCodeLocationAir Quality
Air emissions of the followingpollutants: (1) NOx (excludingN2O), (2) SOx, and (3)particulate matter (PM10)
QuantitativeTR-AF-120a.1
Table of Environmental KeyPerformance
Labor Practices
Percentage of drivers classifiedas independent contractors
QuantitativeTR-AF-310a.1Not ApplicableTotal amount of monetarylosses as a result of legalproceedings associated withlabor law violations
QuantitativeTR-AF-310a.2Not Applicable
Employee Health &Safety
(1) Total recordable incident
rate (TRIR) and (2) fatality ratefor (a) direct employees and (b)contract employees
QuantitativeTR-AF-320a.1
Table of Environmental KeyPerformance
Supply ChainManagement
Percentage of carrier withBASIC percentiles above theFMCSA intervention threshold
QuantitativeTR-AF-430a.1Not ApplicableTotal greenhouse gas (GHG)footprint across transportmodes
QuantitativeTR-AF-430a.2
Table of Environmental KeyPerformance
Accident & SafetyManagement
Description of implementationand outcomes of a SafetyManagement System
Discussion and
Analysis
TR-AF-540a.1Safety Management SystemNumber of aviation accidentsQuantitativeTR-AF-540a.2
Table of Social KeyPerformanceNumber of road accidents andincidents
QuantitativeTR-AF-540a.3Not ApplicableSafety Measurement SystemBASIC Percentiles for: (1)Unsafe Driving, (2) Hours-of-Service Compliance, (3)Driver Fitness, (4) ControlledSubstances/Alcohol, (5)Vehicle Maintenance, and
(6) Hazardous Materials
Compliance
QuantitativeTR-AF-540a.4Not Applicable
Appendix
2023 S.F. HOLDING SUSTAINABILITY REPORT
Readers’ FeedbackDear reader:
Thank you for taking time to read the 2023 SF Sustainability Report. To improve SF sustainable development program and this Report, SF would liketo hear your comments and suggestions.If you have any opinions and suggestions on the sustainable development of the Company, please send an email to sfir@sf-express.com.Readers’ Feedback Form for 2023 SF Sustainability ReportNameCompanyPositionTelEmailYour evaluation: (Please put a check mark in the corresponding box)
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