Co-Founders’ Message
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Co-Founders’ Message
Add: Proya Building, No.588 Xixi Road, Xihu District, Hangzhou, Zhejiang ProvinceE-mail: proya-group@proya.comTel: +86-571- 8735 2850Web: www.proya-group.com
QR code forof? cial website
QR code forWeibo
QR code forWechat
Beauty Aspirations for a Shared Future
Table ofContents
Proya Cosmetics Co., Ltd.
Carbon Footprint Verification ResultReport Authentication Result
2023 Sustainability & Environmental, Social and
Governance (ESG) Report
Sustainability Contribution ReportSustainable Business: Creating Beauty
Sustainable Value Chain: Sharing Beauty
Sustainable Social Ecosystem: Empowering Beauty
Co-Founders’ Message
About ProyaProya Sustainability Governance System
ESG Management Practice Report
Appendix: Scope of the report
Report DescriptionIndicator Index
Environmental Responsibility
Product and Customer Responsibility
Supply Chain Responsibility
Employee Responsibilities
Community Responsibility
Corporate Governance
Compliance Operation
ESG Performance Data Sheet
Co-Founders’ Message0102
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Looking back on the year 2023, the global economy isundergoing a profound transformation. Sustainability hasevolved from a concept to a global consensus, impactingglobal strategies in an urgent and profound manner like neverbefore while acting as a bellwether that directs the future ofall industries.In 2023, Proya celebrated its significant 20thanniversary in a changing market. The past two decades bearnot just our marks of taking challenges, gaining experiences,and achieving growth, but witness our track record of securinga strong position in the fierce market and adapting ourselvesto industry changes.Proya shoulders missions and responsibilities. We set ourexistence by upholding gratitude and pursuing excellence.At the beginning of our establishment in 2003, we set aclear vision to be a China-based international enterprise, anenterprise recognized, trusted, and respected by society,and a private company that has the courage to assume socialresponsibilities while gaining social recognition from it.In theface of changes, we demonstrate keen insight and follow thetide of time to respond to global sustainability demands. Westrengthen our ESG management system, comprehensivelyenhance our performance in environment, society, andsocial governance, and fully drive the achievement of ourglobal sustainability development goals. Supported bythree pillars, namely sustainable business, sustainable valuechain, and sustainable social ecosystem, we firmly adhere toa sustainability development strategy in our efforts to driveproduct innovation and service upgrade.In terms of sustainable business, in 2023, the Longwu R&DCenter and the Shanghai R&D Center were put into operation,providing strong support for independent research anddevelopment. Being dedicated to product development andtechnological innovation, we establish close partnershipswith top ingredient suppliers around the world, use the finestmaterials, and introduce cutting-edge technologies. All helpus craft products that meet the needs of consumers.In terms of the sustainable value chain, we work with strategicpartners both upstream and downstream to jointly promotegreen transformation, actively drive carbon reduction acrossthe entire chain, and bolster sustainable managementthroughout the product lifecycle. We take the lead inestablishing a benchmark for low-carbon supply chain systemsby improving environmental assessment standards across thesupply chain as well as exploring low-carbon technologiesand efficient energy utilization modes in collaboration withpartners. In 2023, we reached a consensus with ten coresuppliers on carbon emissions management and jointlyreleased the Together for a Zero Carbon Future, Beauty in
Co-Founders’ Message
Harmony carbon reduction manifesto at our 20th anniversarystrategy release conference, during which we committed toreduce carbon emissions by 2025.In terms of the sustainable social ecosystem, we firmly assumeour social responsibilities. In August 2023, the Zhejiang ProyaPublic Welfare Foundation was officially established, markinga new milestone in our efforts to promote public welfareundertakings. Meanwhile, we are committed to creating adiverse, inclusive, and caring world around four major topics:
gender equality, emotional relationships, youth and growth,and mental health.Looking ahead to 2024, Proya will hold fast to our originalpurpose and adhere to the philosophy of emphasizing bothquality and innovation. We deeply understand that thevalue of a company lies not only in short-term profitabilityand market share, but also in its contribution to society andpositive impact on human life. We will practice sustainabilitydevelopment with a broader vision and more solid actions.Driven by innovation, we will shape a sound brand image withresponsibility, accomplish our social value by sharing, anddefine beauty with a green attribute. We will work hand inhand with all partners to draw the picture of a harmonious andprosperous future.
>
Co-Founders' Message
0304
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
About Proya
About Proya
Company name:
Headquarters location:
Established in:
Stock code:
Proya Cosmetics Co., Ltd.
Hangzhou City, Zhejiang Province2006
603605 (Shanghai Stock Exchange)
Proya Cosmetics Co., Ltd. (hereinafter referred to as “Proya,”“the Company,” and “we”) is committed to building a new Chi-nese cosmetics industry platform. We specialize in the R&D,production, and sales of cosmetics. Our main brands includeProya, TIMAGE, Off & Relax, Hapsode, CORRECTORS, INS-BAHA, UZERO and Anya. Our own brands cover ? elds such aspopular exquisite skincare, makeup, body & hair, and high-ef? -ciency skincare.
Development of the company:
We develop, manufacture, and sell cosmetic products primarilyon the Chinese mainland. We have two manufacturing facilitiesfor skincare and makeup products in Huzhou, Zhejiang Province.Our sales network encompasses multiple channels such ase-commerce platforms, specialty stores for cosmetics and de-partment stores channel.As of the end of the Reporting Period, we had 2,971 employees.
Company profile
0506
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
About Proya
| 05 | 2023 Sustainability & Environmental, Social and | ||
| Governance (ESG) Report | |||
Empowering and incubating "unique" brands that meet the "unique" needs of "unique" consumers
Title of HonorAwarding BodyGreen Supply Chain Management Company2023Green and Low-Carbon Factory of Zhejiang2023Outstanding ESG Practice of the FragranceFlavor and Cosmetic Industry 2023Wind Best 100 ESG Practices for Chinese ListedCompaniesTop 100 ESG Golden Bull AwardBest ESG AwardsThe 7th IRSC Chinese Outstanding IROutstanding Practice of Women’s Power inESG Cases 2023Outstanding Case of Social Responsibility atthe China Financial Capital ForumValue Chain Leaderboard of “Exemplary Sus-tainable Brands”Selection of Outstanding Cases for 520 SocialResponsibility Day - Caring for Children TopicA model case in theChina Sustainable PalmOil Progress Report - A Collection of Cases ofRSPO China Members
General Of? ce of the Ministry of Industryand Information Technology of the PRCEconomy and Information TechnologyDepartment of ZhejiangChina Association of Fragrance, Flavorand Cosmetics IndustriesWindChina Securities JournalOrganizing Committee of the ESG andSustainable Development Forum 2023Economic Information DailyHuxiu’s ESG TeamCCM CSR Promotion CenterRSPO
ESG management achievements
“6*N” development strategy
ESG ratings>
ESG honors and social recognitions>
The result of 2023 is not available yetProya was rated "BBB" in MSCI ESGRating 2022
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
0708
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Proya Sustainability Governance System
Proya Sustainability Governance System
Sustainabilityconcept
Sustainabilitydevelopment planning
Beauty aspiration for ashared future
Proya upholds the sustainability concept of “Beauty Aspirations for a Shared Future.”With solid sustainability management at the core, we truly care about human and eco-logical sustainability. We create beauty with our ? rst-class products, share it with ourpartners and consumers, and empower communities. We create countless beautifulmoments to shape a better future.
The Proya sustainable development strategic plan “Beauty Aspirations for a SharedFuture” is based on three pillars: sustainable business, sustainable value chain, andsustainable social ecosystem. We facilitate sustainability development based on ho-listic ESG management. The section “Contribution to sustainability development” inthis Report summarizes the annual progress made in implementing our sustainabledevelopment strategic plan.
Sustainability model>
Ever-lasting beauty andsharing blissCorporate mission:
To become a world-classcosmetics enterpriseCorporate vision:
Diligence, pragmatism, passion,aggressiveness, integrity, andgratitudeCorporate spirit:
Responsibility, willingness to learn, highef? ciency, collaboration, innovation, andfairnessCore corporate values:
Sustainable business:
Creating beautyWe are committed to creating beauty in asustainable way. We continuously develop-ing products through innovations, offeringconsumers with safe, effective, and sustain-able products.
Sustainable value chain:
Sharing beautyWe work with partners and consumersto promote sustainable developmentand consumption, making value chainsustainability a reality.
Sustainable society ecosystem:
Empowering through beautyWe provide support to address environmentalchallenges and facilitate social development sothat more people can enjoy a wonderful life.
0910
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Proya Sustainability Governance System
We have established a company-wide sustainability development and ESG structureto ensure the ef? ciency of sustainability development and ESG work. The CorporateStrategy Committee leads strategic planning. Its ESG Management Committee is re-sponsible for managing major ESG projects and evaluating performance, and reportsregularly to the Strategy Committee of the Board of Directors. The ESG Implementa-tion Team is composed of functional units to ensure overall planning and collabora-tion as well as smooth communication between the upper and lower levels.
ESG Decision MakersESG Managers
ESG Compliance
Sustainabilitydevelopmentmanagement structure
The Board of Directors is solely responsible for supervising sustainability developmentand ESG topics, as well as developing corporate sustainability development and ESGmanagement policies and strategies, such as participating in the identification andevaluation of ESG topics. It also provides recommendations and support for necessaryactions to achieve ESG goals.The Strategy Committee is responsible for directing and supervising the managementof major ESG topics, including technological innovation and product quality as wellas safety and green packaging. The Strategy Committee regularly audits the perfor-mance of ESG topics to promote the progress of ESG goals. It also provides recom-mendations on necessary actions to achieve ESG goals and reports regularly to theBoard of Directors on ESG management progress.
The ESG Management Committee is an independent department under the Strate-gy Committee and is composed of senior management members from the GeneralManager’s Of? ce, including the general manager. The department manages environ-mental, social, and governance (ESG) issues and prevents ESG risks. It also reportsregularly to the Strategy Committee and to the Board of Directors on the progress ofESG work.The board secretary leads the ESG Implementation Team, with relevant departmentheads as team members. The team coordinates business modules under the directionof the team leader and reports to the ESG Management Committee on ESG topics. Italso provides information for decision-making and work guidance to business mod-ules to support the execution of ESG strategies and decisions.
Board of Directors
To further accelerate ESG management, we added several provisions to the Perfor-mance Management Measures and the Supplementary Provisions on the PerformanceSystem. These provisions link the incentive compensation of members of the Boardof Directors and senior management with their sustainability development and ESGperformance (hereinafter referred to as sustainable performance). We also developedshort-, medium-, and long-term incentive payment plans to ensure that directors andexecutives are better motivated to perform ESG management in all aspects for a longterm. In the performance assessment system of directors and executives, sus-tainable performance indicators weigh 8-10%, with regular performance assess-ments carried out.Furthermore, we voluntarily disclose ESG (environmental, social, and governance) in-formation through the ESG report and have engaged a professional external agencyto provide ESG training to relevant departments, allowing internal employees to bet-ter understand ESG principles.
Strategy Committee
ESG Management Committee
ESG Implementation Team
Administrative DepartmentFinance DepartmentLegal DepartmentInternal Audit DepartmentInformation ManagementDepartmentHuman Resources DepartmentStrategic ManagementDepartmentOffice of the Chairman of theBoardShanghai R&D centerBrand DivisionsStrategy & Brand CenterLogistics DepartmentProcurement DepartmentProduction baseLongwu R&D Center
Board of DirectorsStrategy CommitteeESG Management CommitteeESG implementation team
1112
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Proya Sustainability Governance System
The support and trust of our stakeholders are vital to Proya. When carrying out andpromoting sustainability development and ESG management tasks, Proya focuses onthe demands of stakeholders and actively communicates with them on multiple chan-nels. We respond to stakeholder expectations and demands by conducting respon-sible practices. We strive to achieve win-win cooperation among all parties, includingshareholders, employees, and society.
Stakeholdercommunication
Stakeholder
Stakeholder
Topic
Topic
Communicationand Response
Communicationand Response
Cooperate with inspectionsEstablish a sound risk manage-ment systemImprove the quality manage-ment system for productsComplete product ? ling anddisclose product formulas tothe public in accordance withlegal requirementsCarry out energy conserva-tion and carbon reducti on,optimize our energy structure,and increase the proportion ofclean energy utilizationProperly manage emissionsand waste by practicing recy-cling and other methods ofreusingPublish ? nancial reports andperformance reports, andcommunicate with investorsand shareholders through SSEE-Interactive, email, road-shows, and other meansIncrease investments inresearch and development, es-tablish an R&D team, engagein R&D collaboration withexternal partners, and partici-pate in industry seminars andworkshopsRegularly hold shareholders’meetingsImplement measures for prod-uct quality and safety manage-ment and conduct customersatisfaction surveysEstablish a comprehensivepublic information approvalprocedure and promote sus-tainable consumption initia-tives to consumersDisclose product formulasthrough announcements onthe websiteCarry out energy conserva-tion and carbon reduction,optimize our energy structure,and increase the proportion ofclean energy utilizationEnhance sustainability in pack-aging
Develop an employee handbookand establish a labor unionEstablish a platform for talentdevelopment and shared learn-ingImplement technical transforma-tion projects for safety, organizesafety production training, andconduct occupational healthexaminationsProvide training and ESG assess-ment for suppliersConduct quality managementtraining and quality audits forsuppliersActively engage in industry ex-changesIncrease investment in researchand development, establish anR&D team, and engage in R&Dcollaboration with external part-ners
Corporate GovernanceRisk and complianceProduct and service qualityChemical safety and ingre-dient transparencyClimate change mitigationand adaptationEmissions and waste
Corporate GovernanceScience and technologyinnovationInvestor rights protection
Product and service qualityResponsible marketingChemical safety and ingre-dient transparencyClimate change mitigationand adaptationGreen packaging
Employee rights andbene? tsEmployee training anddevelopmentOccupational healthand safety
Responsible procurementProduct and service quali-tyIndustry developmentpromotionScience and technologyinnovation
Government andregulatory agencies(The NationalMedical ProductsAdministration, localgovernments, andothers)
Investors andshareholders (investorswho have equity anddebt investments inProya)
Consumers
Employees
Partners (industryassociations, suppliers,distributors, etc.)
Key stakeholders andcommunication channels >
Key stakeholders andcommunication channels >
Volunteer activities, charitabledonations, and community involve-ment by employeesCommunity publicwelfareCommunities and thepublic (communitiesaround sites of opera-tion, public welfare or-ganizations, and others)
1314
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Proya Sustainability Governance System
governance topicssocial topicsenvironmental topics
Proya identifies material topics through regular communication with internal andexternal stakeholders and in accordance with the GRI Standards for SustainabilityReporting (Global Reporting Initiative). When identifying material topics, we complywith Chinese and international laws, standards and industry policies, and consider thepriorities and expectations of stakeholders and the capital market. We identify highlymaterial ESG topics and prioritize them for corporate management and reporting dis-closure, thereby continuously improving the value of the Report.
In 2023, we reviewed and analyzed material topics based on Chinese and internationalstandards and policies. As a result, the topics “protecting the rights and interests ofshareholders” and “water management” were changed. The topic “socially responsi-ble marketing and consumer education” was split to ensure the content is more per-tinent and better aligned with the context of stakeholders, so that their concerns canbe addressed. Through the above material topic identi? cation process, we ? nalizedthe following materiality matrix:
Identification ofmaterial topics
Proya materiality matrix >
We identi? ed and summa-rized 21 topics relevant toProya in accordance withChinese and internationalstandards and policies aswell as based on industrypolicy analysis and peerbenchmarking.
We investigated stakehold-ers based on the 21 iden-ti? ed topics and assessedthe importance of thosetopics for stakeholders.
Based on the investiga-tion results, we com-prehensively analyzedand prioritized thetopics based on theirimportance for boththe Company and ourstakeholders, generatinga materiality analysismatrix.
Preliminary topicidentification
Stakeholder researchComprehensive
result analysis
Importance to Company Finances
Topics of High ImportanceTopics of Moderate Importance
?
?
?
Importance to the Economy, Society, and Environment
Science and technologyinnovationCorporateGovernance
Business ethicsInvestor rights protection
Risk andcompliance
Chemical safety andingredientEmployee rights and benefitsIndustry development promotion
Socially responsiblemarketingGreen packaging
Energy managementClimate change mitigationand adaptation
Emission and wastemanagementResource management
Product andservice quality
Intellectual property management
Responsible procurement
Employee trainingand developmentCommunity public welfare
Occupational health and safety
Topics of High ImportanceTopics of Moderate Importance
Climate change mitigationand adaptationEnergy managementResource managementEmission and wastemanagementIntellectual propertymanagementIndustry developmentpromotionResponsible procurement
Employee training anddevelopmentOccupational health andsafetyCommunity public welfareConsumer educationCorporate GovernanceBusiness ethicsRisk and complianceInvestor rights protection
Green packagingScience and technologyinnovationProduct and service qualityChemical safety and ingredienttransparencyEmployee rights and benefitsResponsible marketing
Materiality analysis process >
Sustainability ContributionReport
2023
Proya Cosmetics Co., Ltd.
2023 Sustainability & Environmental, Social and
Governance (ESG) Report
1718
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Sustainability Contribution Report
Sustainable Planning GoalsCorresponding
SDGs
Progress and Achievements in 2023We will promote the research and the de-velopment of efficacious ingredients tocreate more effective products, and realizethe application of safer and more effectiveself-developed ingredients.
By 2025During the Reporting Period
More than 70% of the palm oil derivativeswe purchase will be from palm oil certi? edby the Roundtable on Sustainable Palm Oil(RSPO). In addition, we will further improveour traceability system for palm oil, one ofthe raw materials we purchase, during theplanning period.
During the Reporting Period, Proya successfully registered our ? rst new cosmet-ic ingredient “3,3,5-TRIMETHYLCYCLOHEXYL SUCCINATE DIMETHYLAMIDE,”which effectively enhanced the core competitiveness and technological threshold ofproducts as well as fully embodied our increased internal R&D capabilities and com-mitted practice of our sustainable innovation strategy.
Proya has always been committed to providing consumers with safer and better prod-ucts. To do so, one of our priorities is to improve our capability in the development ofingredients and enhance the proportion of independent research and development.By independently developing new ingredients, we can better ensure their safety andquality from the source and meet the personalized needs of consumers.In 2023, Proya’s Longwu R&D Center and Shanghai R&D Center were put into opera-tion to focus on the independent research and innovation of new, green, safe, and ef-? cient cosmetic ingredients, thus enhancing our capabilities in fundamental researchand independent development. Meanwhile, we established the Ingredient Researchand Development Department, which integrates the functions of scienti? c research,analysis, and evaluation. The department is dedicated to introducing new, green, safe,and ef? cient cosmetic ingredients, thus enhancing our management capabilities forraw materials.
The proportion of sustainable materialsused in packaging will increase by 20% andpackaging intensity will decrease by 15%over that in 2021.
The proportion of clean energy usage willreach 50%. The emissions of greenhousegases per unit of products (Scope 1 and
2) will decrease by 25% over that of 2021.
Our operations will reach carbon peaking(Scope 1 and 2) by 2025.
We will assess the sustainability of 100% ofnew products and updated products undermajor brands.
We have basically reviewed the current usage
of palm oil in our existing products.
The proportion of sustainable materials used
in packaging had reached 25.47%, represent-
ing an increase of 25.31% compared to that of
2021.
The proportion of clean energy usage reached
35.35%. The emissions of greenhouse gases
per unit of products (Scope 1 and 2) were re-
duced by 17.30%.
The basic framework and mechanism for sus-
tainable product assessment have been estab-
lished.
We successfully registered a new ingredient,
“3,3,5-TRIMETHYLCYCLOHEXYL SUCCINATE DI-
METHYLAMIDE.”
Sustainable Business: Creating Beauty
Developing safe andoutstanding products
In November 2023, Proya registered the ? rst new cosmetic ingredient “3,3,5-TRIMETH-YLCYCLOHEXYL SUCCINATE DIMETHYLAMIDE” with the National Medical ProductsAdministration. The ingredient has of? cially entered the monitoring period with thepatent applied for. With dual bene? ts of skin protection and anti-oxidation, this ingre-dient is suitable for a variety of skincare products except aerosols and loose powdercosmetics. It lays the foundation for further product upgrades.
>Filing information of “3,3,5-TRIMETHYLCYCLOHEXYL SUCCINATE DIMETHYLAMIDE”
Overview of management
Highlighted achievementProya successfully registers the ? rst new ingredient
1920
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Sustainability Contribution Report
Driven by the global trend of sustainability development, we deeply recognize the so-cietal value and strategic signi? cance of implementing sustainable product manage-ment. In response to the increasing environmental awareness of consumers and theirdemands for green, safe, and low-carbon products, we have established a sustainableproduct assessment system while implementing a thorough sustainability develop-ment strategy from original innovation to end products.During the Reporting Period, we established the Sustainable Product EvaluationWorking Group mainly for the product development process. Through inter-depart-mental communication and collaboration, we have further improved and re? ned theProya Sustainable Product Assessment System, established a standardized work? ow,and initiated a pilot project for product assessment.Meanwhile, the top three priorities for sustainability enhancement this year lie in en-hanced sustainable packaging, sustainable palm oil, and low-carbon factories.In terms of product packaging, we invite packaging experts to jointly formulate theProya Sustainable Packaging Management Manualand provide training for relevantdepartments to establish a basis for enhancing the sustainability of product packaging.In terms of sustainable palm oil, during the Reporting Period, we of? cially joined theRoundtable on Sustainable Palm Oil (RSPO), continued to review the use of palm oilderivatives and relevant raw materials in existing products, and started to replace ex-isting materials with RSPO-certi? ed palm oil.In terms of constructing low-carbon factories, we actively promoted the digital andintelligent transformation of factories, thereby driving the upgrade of product qualityand green manufacturing through full-lifecycle digital management. In 2023, Proyawas selected on the list of “Green Supply Chain Management Companies 2023”announced by the General Of? ce of the Ministry of Industry and Information Tech-nology of the PRC. The Huzhou Branch was rated as the “Intelligent Factory of Zhe-jiang 2023” and the “Green and Low-Carbon Factory of Zhejiang 2023.” This marksthe recognition of Proya’s digital, intelligent, and green manufacturing by the govern-ment, third-party organizations, industry experts, and others.
Overview of management
The integrated application of next-generation information technologies such as 5G,Internet of Things, arti? cial intelligence, and big data is driving the cosmetics industryto grow ef? ciently and intelligently. From January 2021 to June 2023, Proya upgradedthe equipment at the 5G smart factory and the intelligent logistics center in line withtheZhejiang Construction Guidelines for Smart Factories. Relying on an informa-tion-based platform, big data analysis, and other technologies, we integrated variousproduction resources to achieve collaborative manufacturing. Proya has taken onestep closer to green manufacturing by establishing an energy management platform,strengthening environmental monitoring, reducing emissions of wastewater, wastegas, and residues, improving energy-saving processes, promoting resource recycling,implementing green supply chains, and utilizing new energy sources.In terms of resource recycling, the heat recovery system for air compressors can pro-vide 502 tonnes of hot water per month.
Creating sustainableproducts
In terms of new energy utilization, the newly built logistics center, covering 25,000square meters, is installed with a 2-megavolt-ampere photovoltaic power generationand energy storage system on the roof. In 2023, the self-built photovoltaic systemgenerates approximately 2,000 MWh of electricity annually, accounting for approxi-mately 12% of the total energy consumption of the whole factory. Besides, in additionto continuous technical transformation, the factory is also equipped with a green,energy-ef? cient and environmentally friendly boiler room, a solar auxiliary heating sys-tem, a ? ue gas waste heat recovery system, and a steam condensate water recoverysystem, which collectively save over 9,888 cubic meters of natural gas each month.
Proya builds a 5G smart factory to drive green manufacturing
In 2023, Proya actively responded to the national policies on carbon emission reduc-tion. We upgraded the packaging of three products, reducing the weight of each singlepackage and the use of plastics. The products include the Advanced Firming NourishingMoisture Cream, the Advanced Firming Nourishing Soft Cream, and the Advanced Firm-ing Nourishing Light Cream. After the upgrade, the amount of plastic used in the pack-aging of a single product decreased by 22%.Meanwhile, re? llable options were released to improve the reusability of bottles. Eachre? llable bag uses 100 grams less plastic.
More sustainable packaging of Proya products
Highlighted achievements
>Proya 5G intelligent logistics center
>Upgraded packaging of Proya products
2122
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Sustainability Contribution Report
Sustainable Planning GoalsCorrespondingSDGs
Progress and Achievements in 2023all of our key partners will conduct ESG compli-ance assessments. We will provide ESG man-agement support to all of our partners.
Proya fully recognizes our core position in the industry chain and the sustainabilitydevelopment responsibilities that come with it. Therefore, we are ?rmly committed todriving the entire value chain towards green and sustainable transformation. To ful?llthis responsibility, we have adopted an array of strategies designed to promote envi-ronmental upgrades throughout the value chain.In managing strategic suppliers, Proya works with them to align the common focus onreducing carbon emissions as a key task. By strengthening environmental assessmentstandards in the supply chain, all stakeholders work together to explore low-carbonproduction technologies and ef?cient energy utilization solutions. The purpose is togradually establish a low-carbon supply chain system that serves as a demonstration.During the Reporting Period, we reached a consensus with ten strategic suppliers oncarbon emissions management and jointly released theTogether for a Zero Carbon Fu-ture, Beauty in Harmonycarbon reduction manifesto at our 20th anniversary strategyrelease conference, during which we committed to reduce carbon emissions by 2025.We strictly adhere to the ESG principles in our dealings with key partners and inte-grate them into the cooperation mechanism. In this way, we ensure that partners com-ply with environmental regulations and social responsibility standards in every aspectfrom raw material procurement to production and logistics, thereby enhancing thegeneral sustainability performance of the supply chain.
In 2023, Proya evaluated 264 suppliers for their ESG performance with a pass rate of100%, and conducted ESG compliance assessments for all of our key partners. At the20th anniversary strategy release conference, Proya provided all suppliers with train-ing on sustainability development and ESG knowledge, aimed at enhancing partners’ESG understanding and practice.Meanwhile, Proya actively plays the leading role and shares our own sustainabletransformation experience with the entire industry. By actively attending seminarsand workshops, Proya facilitates industry peers to draw on and learn from advancedsustainability development modes so that they can jointly draw a picture of greendevelopment for the cosmetics industry. As the ?rst company to use green recyclablecartons in the industry, we play our role in setting examples. During the Reporting Pe-riod, 9 suppliers adopted our way and started to use green recyclable cartons.
We will disclose our product sustainability in-formation in multiple ways to share our sustain-able consumption concept with consumers.
We will drive sustainability development trans-formation for all partners in our value chain andshare our sustainability development actionswith our industry peers.
Efforts will be made to promote all strategicpartners to reduce carbon emissions throughcarbon reduction initiatives and incentives onthe value chain.
Proya added sustainable labels to pack-ages and advocated for the use of re?ll-able options, bottle recycling, and otherenvironmental protection campaignsthrough multiple channels.
Proya co-hosted the Proya Logistics Salonto share our sustainable practices withindustry peers.
Proya collaborated with the top tenstrategic partners (suppliers) to jointlyrelease the Together for a Zero CarbonFuture, Beauty in Harmony carbon re-duction manifesto.
Proya evaluated 264 suppliers for theirESG performance, and conducted ESGcompliance assessments for all of our keypartners.
Sustainable Value Chain: Sharing Beauty
Joining hands withpeers and partners
In 2023, Proya collaborated with the Shanghai Supply Chain Development PromotionAssociation and Daen Logistics to co-host the Proya Logistics Salon at the ShanghaiInternational Logistics Festival. During the salon, we shared our practical experienceand deep insights on building a green supply chain. In the past few years, Proya hasnot only maintained a steadily growing momentum in the cosmetics market, but hasalso fully integrated the concept of sustainability development into our operations.Measures have been taken to fully promote green development in e-commerce logis-tics, production, manufacturing, and packaging design.
By sharing those experiences, we spread our leading sustainability development cas-es among peers and provide them with effective practices.
In terms of energy conservation and emission reduction in logistics, Proya pilotsthe replacement of some fuel-powered forklifts with new energy vehicles andoptimizes the transportation process in a scienti?c manner, thereby effectivelyreducing resource consumption.In the e-commerce channel, Proya is the ?rst in the industry to use recyclablecartons as a replacement for disposable cartons, thereby signi?cantly cuttingthe use of cardboard and adhesive tapes and reducing carbon emissions. Forthe delivery of products requiring special insulation, we apply environmentallyfriendly nano-incubators to replace traditional foam incubators to effectivelyeliminate a source of white pollution. Furthermore, the packaging of productsets has been upgraded by using environmentally friendly shrink ?lm insteadof non-biodegradable plastic bags, thereby achieving the goals of cost savingand reduced environmental pollution at the same time.In terms of intelligent storage and logistics, Proya has built a modern automat-ed warehouse covering a ?oor area of approximately 60 mu (40,000 square me-ters) and a building area of 120,000 square meters. The warehouse is equippedwith high-speed stacker cranes, robotic sorting systems, and other efficientand low-energy equipment to ensure the high-ef?ciency and low-carbon oper-ation of the warehousing and logistics system.
Overview of management
Highlighted achievementsProya shares experience in sustainable supply chain management
By 2025During the Reporting Period
2324
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Sustainability Contribution Report
At the 20th anniversary strategy release conference, Proya released the Together for aZero Carbon Future, Beauty in Harmony carbon reduction manifesto together with tenstrategic partners, including Evonik Specialty Chemicals (Shanghai) Co., Ltd., CrodaChemicals (Shanghai) Co., Ltd., BASF (China) Co., Ltd., Symrise (China) Investment Co.,Ltd., and Clariant Chemicals Technology (Shanghai) Co., Ltd.This move demonstrates the strong dedication to environmental sustainability andin-depth collaboration by and between Proya and our partners. These ten strategicpartners each possess exceptional expertise and environmental practices within theirrespective ?elds. With this initiative, we will be committed to not just energy conser-vation and emission reduction in operations, but also to deeper technical exchanges,resource sharing, as well as the development and application of innovative solutions.This will enable us to comprehensively improve and upgrade our green supply chain.The establishment of this strategic partnership signi?es a solid step for Proya in ex-ploring sustainability development modes, and sets an example for the industry inpromoting collaboration and building a green future together. We will join hands withall stakeholders to create a greener, more environmentally friendly, and more ef?cientindustrial ecosystem, continuously enhance our value to society, and contribute moreto the environment.
Promoting the idea of sustainable consumption among consumers plays an indispens-able role in driving the sustainable product practices of businesses and society as awhole. The shift in consumer behavior and awareness is crucial for drawing a closed-loop green consumption cycle from production to end use. It not only drives the mar-ket to demand more environmentally friendly and greener products, but also fostersa societal value of resource conservation and environmental protection. Therefore,developing an awareness of sustainable consumption among consumers has becomea part of Proya daily operational strategy.During the Reporting Period, Proya took a series of measures to enhance communi-cation with consumers and encourage them to adopt more sustainable consumptionpractices. For example, we add sustainable labels at prominent locations of productpackages, sending clear and intuitive messages to consumers about the environ-mental attributes and recyclable value of the product. Also, we actively advocatefor the use of re?llable options and the recycling of empty bottles on various onlineand offline communication platforms, and encourage consumers to take down-to-earth actions to reduce waste and protect the environment while enjoying premiummakeup products. The combination of those measures enhances our interaction withconsumers in environmental protection and fosters the sustainability concept amongconsumers.
Conveying theconcept of sustainableconsumption
The recycling of packaging waste is the final stage of full-lifecycle packaging man-agement, essential for achieving resource recycling and environmental sustainability.By applying prominent sustainable labels on the product package Proya enhancesconsumers’ awareness of package recycling and works with them in the recycling andmanagement of discarded packages to ensure the proper disposal of discarded pack-ages.
Highlighted achievements
Overview of management
Proya and partners jointly release a carbon reduction manifesto
Proya co-creates a culture of sustainable consumption through guiding labels and edu-cational outreach
Educational article on sustainable packaginglabels on the of?cial website>>Proya’s sustainable packaging labelIn addition, Proya publishes educational articles on the of?cial website to publicizecommon sustainable packaging labels and their meanings. The purpose is to raiseconsumers’ knowledge of package recycling labels, develop green consumption hab-its, and effectively promote the circular economy.
>Together for a Zero Carbon Future, Beauty in Harmony carbon reduction manifesto
In 2023, Proya creatively launched refillable options for hot sellers including theDouble Effect Brightening Essence 3.0, and the Advanced Firming Nourishing LightCream 3.0. The previous small- and medium-sized gifts were replaced with re? llablepacks, signi? cantly reducing the unnecessary consumption of packaging materials.In addition, Proya further integrated and optimized the product marketing and com-munication strategy, actively publicized the sustainability of products, and frequentlyencouraged consumers to buy re? llable options instead of full-sized products, aimingto reduce the generation of packaging waste.During the Reporting Period, Proya promoted the use of re? llable options on multiplemainstream social media platforms such as Weibo, Xiaohongshu, Zhihu, and TikTok,gaining more than 100 million views. This move effectively promoted public aware-ness and engagement in the sustainable consumption of cosmetics.
On the occasion of World Earth Day in April 2023, Off & Relax launched the #offrelaxrecycling program, during which the brand worked with artisans to transform emptybottles and repurpose them, aiming to give discarded packages a new life and newvalue through the fusion of artistic creation and routine application and reduce thegeneration of packaging waste.In this event, Off & Relax collaborated with over 20 key opinion leaders (KOLs) fromnew media agencies to transform empty Off & Relax bottles into uniquely styled homeornaments, gardening tools, or useful containers in an artistic manner that considersboth personal aesthetics and domestic needs. Off & Relax published the event onWeChat, Weibo, and Little Red Bookto communicate a recyclable lifestyle and stir upconsumers’ awareness and action for environmental protection. The event received 1.5million views online.With this program, Off & Relax furthered its exploration and practices in the fieldof green packaging, demonstrated its firm commitment and practical action forenvironmental friendliness, and set a new example for the cosmetic industry ininnovative green packaging and resource recycling
Proya advocates for purchasing refillable optionsOff & Relax recycling program for used bottles
>Recycling program for used bottles
2526
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Sustainability Contribution Report
2728
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Sustainability Contribution Report
Sustainable Planning GoalsCorresponding SDGsProgress and Achievements in 2023
In 2023, Proya donated to establish the Zhejiang Proya Public Welfare Foundation(hereinafter referred to as “Proya Foundation” or “the Foundation”). With the vision of“uniting the power of love to make the world a better place for love,” the Foundationis committed to enabling more people to live a better life. Its welfare prioritiesinclude “promoting education development,” “seeking innovation in community,”“responding to emergencies and disasters,” and “providing benefits for employees.”
we will directly influence 500,000people and indirectly in?uence 500million people by carrying out so-cial welfare activities.
The social welfare activities promoted byProya bene?ted 233,000 people directlyand 247 million indirectly.
Proya invested CNY8.6612 million in so-cial welfare to build a more equal anddiversi?ed society.The investment totaled CNY10.0958 mil-lion.
The cumulative number of direct bene?-ciaries reached 665,100 people and indi-rect bene?ciaries 365 million.
Sustainable Social Ecosystem:
Empowering Beauty
Establishing theZhejiang Proya PublicWelfare Foundation
Progress and achievements of publicwelfare activities >
Public Welfare ActivityMeasures and Achievements
We united with the Shanghai Adream Foundation tolaunch the “Go Far” educational and charitable travelprogram. During the program, we educated childrenabout the knowledge involved in the whole process ofproduct development, production, and launch.We donated CNY400,000 to the Proya Hope PrimarySchool to upgrade campus facilities, perform renova-tion projects, and build a rubber playground.We officially launched the “One County, One Dream”charity project, with a plan to hold Dream Sports classesin 10 primary and secondary schools in Qiemo County,upgrade their sports facilities, organize sports events,enhance the professional abilities of local sports teach-ers, and promote the physical and mental well-being ofstudents.We established a charitable trust fund for the “Power ofBeauty” women’s care campaign at Xihu District CharityFederation, in which women’s entrepreneurial skill train-ing, women’s leadership training, and skincare classeswere held to bring more employment and growth op-portunities for women.We collaborated with relevant organizations withinProya to donate emergency food, winter supplies,women’s hygiene kits, and daily necessities worth CNY2million to Jishishan County in Linxia Prefecture, GansuProvince. This donation supported local earthquakerelief efforts and provided essential support for the af-fected population.On World Earth Day, we launched a campaign under thetheme “Unleash the Power of Your Actions for a BetterPlanet.” During the event, we advocated for environ-mental protection and upcycling and hosted eco-friend-ly film screenings to encourage employees to partici-pate in environmental charity and low-carbon activities.We launched the “Love in Proya for New Life” charitablepublicity campaign, calling on employees to activelyparticipate in public welfare projects.We initiated the “Hydromel Winter Warmth” program,encouraging employees to donate supplies for straysand participate in volunteer activities.
Promotingeducationdevelopment
Seeking innovationin community
Responding toemergencies anddisasters
Providing benefitsfor employees
The work and contributions of the foundation in public welfare and charity have beenrecognized by society. During the Reporting Period, the foundation was honoredwith the first “West Lake Charity Award - Charity Role Model” and was alsoawarded the title of vice president at the third session of the Xihu District Chari-ty Federation in Hangzhou.
By 2025During the Reporting Period
During the Reporting Period
By the end of the Reporting Period
By the end of the Reporting Period
we will invest RMB12 million in so-cial welfare and building a moreequal and diversi?ed society.
Overview of management
2930
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Sustainability Contribution Report
In August 2023, the Proya session of the “Go Far” educational and charitable travelprogram was successfully held at the Proya Headquarters Building in Hangzhou. Withcuriosity and admiration for cosmetics companies, several children from Longnan,Gansu, embarked on a half-day enterprise study tour with the Proya project team.By gaining insight into the company’s history, touring the Proya R&D Innovation Cen-ter, participating in hands-on lipstick production, observing new media and lives-treaming positions, learning skincare knowledge, and feeling an artistic atmosphere,we provided those children great opportunities to feel beauty while being nurturedwith a seed of “discovering, experiencing, creating, and spreading beauty.” We ex-pect this seed of beauty to take root and ? ourish, guiding them towards a better life.
In September 2023, the “One County, One Dream” charity project officially com-menced at the First Elementary School in Qiemo County, Bayingolin Mongol Autono-mous Prefecture, Xinjiang, China.As a result of intensive cooperation between Proya and the Adream Foundation, the“One County, One Dream” charity project aims to systematically improve the profes-sional abilities and vocational spirit of sports teachers in remote areas of Xinjiang andhelp students enhance their physical and mental development by means of holdingDream Sports classes in 10 primary and secondary schools, renovating their sportsfacilities, and organizing sports events.
In 2023, Proya established the “Power of Beauty” women’s care campaign at Xihu Dis-trict Charity Federation. By organizing women’s entrepreneurial skill training, women’sleadership training, and skincare classes, we support women’s family relationships,workplace interpersonal relations, mental health, and emotional management. In ad-dition, professional psychological counseling is provided to help women expand theirhorizons and build a mind of growth.Meanwhile, Proya will mobilize more people in society to join our care and support forwomen’s growth, hoping to create more employment and growth opportunities forwomen, help them better identify themselves, and enhance their internal motivatorsand external advantages for growth.
>Site of the Proya session
>Proya “One County, One Dream” charity project
>Proya “Power of Beauty” women’s care campaign
In December 2023, a 6.2-magnitude earthquake struck Jishishan County in Linxia Pre-fecture, Gansu Province. The Proya Public Welfare Foundation immediately initiatedthe emergency response mechanism and coordinated with relevant internal depart-ments to rapidly organize, allocate, procure, and transport supplies.The foundation mainly procured halal emergency food, winter clothing, emergencytents, heating appliances, women’s hygiene kits, and daily necessities to provide basicliving support for the disaster-affected population. As of the end of the Reporting Pe-riod, the foundation had donated CNY2 million worth of emergency relief supplies tothe disaster-stricken areas.
>Proya Public Welfare Foundation donating supplies
“Go Far” educational and charitable travel program
“One County, One Dream” charity project
Proya “Power of Beauty” women’s care campaign
Proya Public Welfare Foundation provides aid to earthquake-stricken areas in Gansu
Highlighted achievements
3132
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Sustainability Contribution Report
Advocating for andjointly creating a bettercommunity
Genderequality
Love and caring Mental health
Youth and
Growth
In the view of Proya, the beauty of a brand lies not only in the external charm createdby its products, but also in its deep concern for social issues and active contributionsto society. We are well aware that the existence and development of a company can-not be separated from the social environment and cultural context in which it oper-ates. Therefore, the concern for and commitment to public welfare undertakings formour essential responsibility and intrinsic driving force as a leading cosmetics companyin the industry. We ? rmly believe that every business has the power to do its part indriving social advancement, promoting growth, and changing the world with its ac-tions.For years, Proya has been deeply committed to social welfare activities, proven by aseries of meticulously designed brand marketing campaigns around public welfarethemes. During the Reporting Period, we maintained our focus on four main topics:
gender equality, love and caring, youth and growth, and mental health. We advocatedfor the values “breaking gender bias,” “braving the real essence of love and intimaterelations,” “caring about school bullying and supporting the healthy growth of adoles-cents” and “recognizing emotional experiences, caring and embracing oneself.”Those social initiatives and public welfare practices form not only an important part ofProya’s brand culture, but also a strong emotional bond between consumers and us.We will uphold this commitment and imprint the spirit of charity deeply in every stepof brand development. Joining hands with the communities we care about, we willcreate a better, more inclusive, and loving world.
Recognizing emo-tional experiences,caring and embracingoneselfCaring about school bul-lying and supporting thehealthy growth of adoles-centsBraving the real essence oflove and caring relationsBreaking genderbias
Four main topics
[ Gender equality ]“It’s Gender, Not Border!”
On top of the view that “It’s Gender, Not Border,” in 2023, Proya took further steps totranslate this brand attitude into action. This includes addressing real issues, lookinginto real practices, and providing real support.
On International Women’s Day in 2023, Proya once again drew public attention to thetopics of gender equality and women’s rights based on genuine “her stories.”Proya specially planned the TV commercial “She is the Captain” based on a true storyand introduced the theme song “Keep Up, Girl,” which tells a story of a Tibetan girlnamed Xiaoma who becomes the captain of her college’s freshman soccer team. Thestory shows the courage and resilience of the young girl in the face of prejudice. Itchallenges the stereotype that women can’t excel on the ? eld, face physical confron-tation, or lead a team to victory.The TV commercial “She is the Captain” breaks gender biases and stereotypes, whichaffirms Proya’s longstanding advocacy that “It’s Gender, Not Border.” We need tobreak stereotypical gender biases before truly knowing ourselves and unleashing ourfull potential.
>Short video “She is the Captain”During the Reporting Period, the TV commercial “She is the Captain” received morethan 6.77 million view counts and over 680,000 discussions across all platforms.
Short video “She is the Captain”>Scan to watch
3334
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Sustainability Contribution Report
>We Can Do Itgender education picture book
Proya has compiled the gender education picture book We Can Do It suitable for read-ers of all ages. The book prompts us to re?ect on the importance of gender educationwhile delving into gender issues. It conveys Proya’s vision of “breaking gender bound-aries” and implants the concept of gender equality into the minds of more people.With the gender education picture book We Can Do It, Proya expects to raise aware-ness about the subtle biases that exist in our lives, inspiring us to break preconcep-tions and truly appreciate everyone in our midst. The objective of this book is forchildren and teenagers to gain an enlightenment of gender equality, and for adults tore?ect on how to create a society that is inclusive, respectful, diverse, and safe for allgenders. During the Reporting Period, a total of 110,000 copies ofWe Can Do Itwereprinted and distributed.
Proya hopes that the discussion of “combating gender bias and breaking stereo-types” is extended beyond March to “every day from this day.” Therefore, Proya haspartnered with Beijing Qianqian Law Firm to launch the Proya Public Welfare Servicemini-program, which provides legal consultation services for workers experiencinggender bias. This initiative aims to help more employees affected by gender bias toutilize legal protection and receive professional legal assistance in cases of workplacediscrimination. Any woman experiencing unfair treatment in the workplace can seeksupport from legal professionals through this platform. During the Reporting Period,the Proya Public Welfare Service mini-program provided legal advice to 966 people,including pro bono legal consultation services to 87 people.
>Proya pro bono legal consultation service for workers
We Can Do It gender education picture bookLegal consultation services
>Scan to watch
3536
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Sustainability Contribution Report
Meanwhile, Proya captured the moments of love perception with a 3-minute love-themed short ? lm titled Dare to Love, Dare to Not Love. Opening with the question“Does love really still exist?,” the video takes the audience through a series of lovestories and unfolds romantic re? ections one after another. The story culminates withthe question “Does love really still exist?” and gives the Proya answer that “love is al-ways there if you follow your heart and dare to love and to not love.” Meanwhile, Proyaissued test cards titled “Know Yourself in Intimate Relations” to help the audiencebetter know themselves in love.
On Mother’s Day in 2023, Proya continued to care about mothers and their physi-cal and mental workload assumed for their families. On this day, Proya appealed toeveryone to recognize mothers’ hardships and difficulties in traditional housework,and proposed the brand attitude “Moms can take care of the family, but every familymember can do the same.” By means of the TV commercial Mom is Not the Only One,the creative peripheral apron for the whole family, creative posters, and the adaptedchildren’s song “Mom is Not the Only One,” we call on every family member to notjust see the merits of mothers, but assume their responsibilities as family members.
During the Reporting Period, the public welfare short ? lm Dare to Love, Dare to NotLove received over 21.79 million view counts with over 460,000 discussions raisedacross all platforms. Additionally, 19,000 copies of the “Know Yourself in Intimate Re-lations” test cards were distributed.
>Themed short film My Desired Happiness
>Themed short filmMom is Not the Only One
>Themed poster of Mom is Not the Only One
[Love and caring]
Mom is Not the Only OneProya probes into the importance of love and caring, and is committed to exploringhow to listen to the inner voice and make courageous choices in those relations. Wefocus on how individuals achieve personal growth in intimate relationships, and en-courage people tobelieve in the deep voice inside their mind with sincerity and courage.On Chinese Valentine’s Day in 2023, Proya invited netizens to leave messages to sharetheir love stories and discuss the sense of self and boundary in love relations. Inspiredby users’ stories, Proya worked with NetEase Cloud Music and JIN Wenqi to createa love song “My Desired Happiness,” which is about experiences and re? ections onselves in love relations.
[Love and caring]Dare to Love, Dare to Not Love
>Scan to watch>Scan to watch
3738
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Sustainability Contribution Report
[Youth and growth]Glimmering Project
In 2023, Proya continued with its anti-school-bullying initiative Glimmering Project byreleasing a public welfare short ? lm titledAftermath of School Bullying. This ? lm putseyes on not just bullied children, but on the long-term impact on them after beingbullied. Proya shed light on the aftermath of bullying in schools through three truestories, calling for an end to school bullying.
Proya laid bare the truth of school bullying with exceptional sensitivity and insight,removing blind spots and raising awareness with the weighty question, “Will it getbetter as we grow up?” It calls for public attention to the current situation of thosewho have experienced school bullying and encourages providing assistance withinour means. In addition, Proya specially published the printed bookIt’s Not Your Fault:
A Healing Guide for the Aftermath of School Bullying, urging society to recognizeschool bullying and understand preventive and responsive measures.
Proya partnered with the Beijing New Sunshine Charity Foundation to establish The“Glimmering Project , a dedicated anti-school-bullying helpline that provides psycho-logical counseling and legal advice for victims and their families. Meanwhile, Proyaraises discussions around the topic “Bullying is Never Right” on Weibo, and continuesto make voices heard on various platforms, aiming to turn advocacy into action andexpand the in? uence of the campaign.
During the Reporting Period, the public welfare short ? lm Aftermath of School Bully-ing received more than 44.41 million view counts across all platforms with over 62.11million interactive discussions. The anti-bullying helpline provided free psychologicalcounseling for 353 victims of school bullying and their families, including pro bonolegal consultation services provided to 27 victims. A total of 15,000 copies ofIt’s NotYour Fault: A Healing Guide for the Aftermath of School Bullyingwere printed anddistributed.
>Public welfare poster of Glimmering Project
>It’s Not Your Fault:A Healing Guide for the Aftermath of School Bullying
>Proya’s The “Glimmering Project anti-school-bullying helpline
>Scan to watch>Scan to read
3940
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Sustainability Contribution Report
Mental health:
Echo Project
On World Mental Health Day on October 10, 2023, Proya carried on with the EchoProject youth mental health campaign and released a public welfare film for youthmental health titledSay ____ to Your Emotions Right Now. In the ? lm, we advocatethat “We are not alone in the face of emotions” and “No one should be ashamed ofemotions.” We encourage consumers to take a step further so they can listen to theirinner voice and try to express their emotions.
In addition, Proya partnered with Dejavu and 9 publishing houses to design a curatedlist of emotional healing books and blind boxes of books, selecting 11 books on emo-tions, packaging them into the Echo Bookshelf with 10,000 emotional pouches, andgiving them to readers as gifts. Also, Proya and Tencent Music jointly organized publiccampus concerts and other activities, allowing people to cope with their emotions inmultiple ways.
Proya is constantly deepening our understanding and presentation of mentalhealth issues. Our efforts include acknowledging the existence of emotional issues,encouraging emotional expression and release, and providing practical support.The three-year evolution and development of Echo Project not just embodiesProya’s longstanding care about mental health issues, but underscores our enduringdedication to the public.
During the Reporting Period, the publicwelfare filmSay ____ to Your EmotionsRight Nowtouching upon mental healthamongst young people received 52.49million view counts with over 210,000discussions raised across all platforms.The Let Emotions Talk public campusconcert was held at 30 universities in 6cities with over 30,000 participants.
>Public welfare filmSay ____ to Your Emotions Right Now
>Let Emotions Talk public campus concert
>Echo Bookshelf event
Proya Echo Project psychological counselinghelpline>
>Scan to watch
2023 Sustainability & Environmental, Social and
Governance (ESG) Report
ESG ManagementPractice Report
Proya Cosmetics Co., Ltd.
4344
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Environmental Responsibility
Proya strictly complies with environmental laws and regulations, including theEnviron-mental Protection Law of the People’s Republic of China, the Prevention and Control ofEnvironmental Pollution by Solid Waste of the People’s Republic of China,and theRegu-lations on the Safety Management of Hazardous Chemicals. We follow an environmentalmanagement policy to save energy, reduce consumption and emissions, and increaseef?ciency. We continuously strengthen our environmental risk management to ensurethat our production and operations comply with relevant laws, regulations, and stan-dards. We have established management documentation covering all environmentalimpact factors. Additionally, we implement various management policies in our produc-tion and operations to ensure effective control of environment-related risks.During the Reporting Period, our use of resources had no signi?cant impact on theenvironment. We paid environmental protection taxes and fees in full, and no vio-lations of environmental protection laws or regulations occurred.
Environmentalmanagement system
StageInputOutput
*Raw materials, energy,and water consumed in theproduction and operationsof various suppliers
Resources: Raw materialsand packaging materialsEnergy: Natural gasEnergy: Outsourced elec-tricity, self-produced photo-voltaic powerWater: Municipal watersupply
*Waste water, wastegases, solid waste,and greenhouse gases(Scope 3) generatedin the production andoperations of varioussuppliersGreenhouse gases(Scope 1 and Scope 2)Waste gases: Volatileorganic compounds(VOCs), nitrogen oxides(NOx), and oil smokeWaste water: Chemicaloxygen demand (COD),ammonia nitrogen con-tent (NH3-N)General waste: Discard-ed product packaging,expired products, dis-carded membranes and?lters, sludge from sew-age stations, domesticwaste, and kitchenwaste from canteensHazardous waste:
Hazardous reagentsfrom laboratories, wastemachine oil, waste ink,and others
Purchasing
Produc-tion andR&D
Product ingredients andpackagingSteam generation, pastemaking, and heating
Product ingredient wa-ter, process media, andcleaning
Air conditioning and re-frigeration, productionpower, and lighting
Environmental management systemcertification >
Analysis of the environmentalimpact of each process
>
Environmental impacts marked with * are not covered in this Report.
Company/Manufacturing Base
Certification
Valid Period of
Certification
ISO 14001?20152025.2.14Skincare factory
Number of environmental safety incidents
Performance highlights
Overview of management
Greenhouse gas emissions(Scope 1 and Scope 2) wasCO
e /CNY10,000
8.33
kilograms of
Decreased bycompared to 2022
32.93%
35.35
%
The use of clean energyaccounted forreducing greenhouse gasemissions by4,774.30tonnes of CO
e
Increased bycompared to 2022
16.94%
The proportion of sustainablepackaging materials used was
25.47
%
Increased bycompared to the baselineyear of 2021
25.31%
4546
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
StageInputOutputAnalysis of the environmentalimpact of each process
>
*Water and energy con-sumed when consumersuse products (generatinghot water)*Energy and water con-sumed in the productionand operations of wastedisposal units
Resources: Transport pack-aging materialsEnergy: Gasoline anddiesel consumed by freightvehicles; outsourced elec-tricity used in warehouseoperations (including thirdparties
)*Energy and resources con-sumed in the operations ofdistributors
Energy: Outsourced elec-tricity and gasoline con-sumed by company-ownedvehiclesWater: Municipal watersupply
*Waste generated afterconsumers use products*Waste water, wastegases, solid waste,and greenhouse gases(Scope 3) generatedin the production andoperations of wastedisposal units
Greenhouse gases(Scope 1, Scope 2, andScope 3)General waste: Discard-ed product packagingand domestic waste
Waste water: Domesticwaste waterNon-hazardous waste:
Domestic wasteGreenhouse gases(Scope 1 and Scope 2)
Product usage anddisposal
Distribution andwarehousing & logistics
Office operations
Proya Huzhou Factory was designed and built in accordance with GMP standards. Allproduction workshops meet the environmental control standards for cosmetic cleanareas. The intelligent warehousing center has fully optimized the data and the roboticautomation system, maximizing the sustainability of healthy and ecological produc-tion and achieving our strategic goals of cost reduction and ef?ciency enhancement.In September 2023, Proya Huzhou Factory was awarded the title “Green and Low-Car-bon Factory of Zhejiang 2023.”
Proya closely follows the situation of global climate change and places high impor-tance on climate change management. Proya has incorporated “climate changemitigation and adaptation” as one of our material topics for ESG management. TheBoard of Directors supervises and manages the Company’s ESG issues, including cli-mate change issues. Relevant functional and business departments integrate climatechange management into their daily work priorities. In 2023, we submitted the Cli-mate Change Questionnaire to the Carbon Disclosure Project (CDP) and achievedgrade “B”, re?ecting our effective management in sustainability and climate action.Our greenhouse gas emissions are generated throughout the product lifecycle, with asmall percentage arising from of?ce operations. Based on identi?ed sources of green-house gas emissions, we set greenhouse gas emission reduction goals in Proya Sus-tainable Development Strategic Plan and collect greenhouse gas emission data everyyear to assess our performance in climate change management.
Climate changemitigation andadaptation
Primary Energy
Consumed
Major GreenhouseGas SourcesProcess EmittingGreenhouse GasesIdentified sources ofgreenhouse gas emissions >
Energy consumed in theproduction and transporta-tion of raw materialsElectricityNatural gas
ElectricityGasoline and diesel con-sumed by freight vehicles
Energy consumed by wa-ter utilities during productusageEnergy consumed forwaste recycling and dis-posalElectricityGasoline and dieselconsumed by self-ownedvehicles
Scope 3 emissions generatedin the production and trans-portation of raw materialsScope 2 emissions from theconsumption of electricityScope 1 emissions from theconsumption of natural gas,gasoline, and diesel fuel con-sumed by company-ownedvehiclesScope 2 emissions from theconsumption of electric-ity consumed by compa-ny-owned warehousesScope 3 emissions generatedfrom third-party warehousesand freight vehiclesScope 3 emissions
Scope 2 emissions from theconsumption of electricity
Procurement of rawmaterialsProduction
Product distribution
Product usage anddisposal
Office operations
Third parties are not covered in this Report.
4748
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Я???
MeasureAchievement
??
TypeGreenhouse gas emission reductionactions >
Greenhouse gas emissionreduction goals >
The proportion of clean energy will reach 50%, and carbon peak willbe accomplished in business operation.Greenhouse gas emissions (Scope 1 and Scope 2) per unit of productwill decrease by 25% compared to 2021. Carbon peak (Scope 1 andScope 2) will be accomplished in business operation.We will drive all strategic partners to reduce carbon emissionsthrough value chain carbon reduction initiatives and incentives.
Carried out clean production as well asenergy-saving and technology upgrades inan orderly manner.
Reduced green-house gas emissionsby 177.21 tonnesof carbon dioxideequivalent
Reduced green-house gas emissionsby 4,744.30 tonnesof carbon dioxideequivalent.
Reduced green-house gas emissionsby 650.42 tonnesof carbon dioxideequivalent.
Used 6,121.42 megawatt-hours of green elec-tricity.Installed a photovoltaic system on the roofof the new warehouse, with an installationarea of 38,197 square meters and a capacityof 2,000 kilowatts. The annual electricityoutput is estimated to be approximately2,000 MWh. During the Reporting Period,the photovoltaic system generated 2,197.53MWh of electricity.As of the end of the Reporting Period, allforklifts at the factory had been replacedwith new energy forklifts.Advanced Firming Nourishing Light Cream
3.0 has simplified packaging design com-
pared to 2.0, reducing plastic usage byapproximately 100.49 tonnes during the Re-porting Period.Double Effect Brightening Essence hasadopted substitution packaging design, re-ducing plastic usage by approximately 107.97tonnes during the Reporting Period.
We will achieve net zero emissions from our operations.We will achieve carbon neutrality across our entire value chain.
Implementedenergy-savingand technolo-gy upgrades.Used cleanenergy.
Packagingreduction andsubstitution
By 2025
By 2030
By 2045
We actively communicate and collaborate with original equipment manufacturers(OEMs) and original design manufacturers (ODMs) to seek carbon reduction oppor-tunities in production. During the Reporting Period, an OEM factory reduced its elec-tricity consumption by using automated products, saving approximately 28 MWh ofelectricity per year.We promote carbon reduction policies to our raw material suppliers and plan for theestablishment of a system for collecting and evaluating suppliers’ carbon emission
data. We prioritize suppliers with lower carbon emissions. During the Reporting Pe-riod, the range of carbon data collection covered 156 suppliers, accounting for 90%(amount of cooperation) of raw material suppliers. Additionally, during the ReportingPeriod, Proya’s e-commerce delivery boxes (May 1, 2023 to December 31, 2023) hadachieved achieve carbon neutrality by suppliers through carbon offset, reducing thecarbon footprint of products in the distribution and transportation processes.
In the sales process, all of our stores choose the best energy-saving solutions duringrenovation to reduce carbon emissions during operation. Our extensive sales are alsoengaged in carbon reduction initiatives. For example, a photovoltaic power genera-tion facility has been installed at Haining Intime Department Store to partially replacetraditional energy sources.During the Reporting Period, Proya reached a consensus with the top ten strategicpartners on Proya Sustainable Development Strategic Plan and released theTogetherfor a Zero Carbon Future, Beauty in Harmony” carbon reduction manifesto, commit-ting to reduce carbon emissions by 2025.
20212021
7,420.89
8.33
2022202220232023
8,426.86
7,933.90
Greenhouse gas emissions (Scope1 and Scope 2) in the past 3 years(tonnes of carbon dioxide equivalent/CNY10,000)
Greenhouse gas emissions per RMB10,000of revenue (Scope 1 and Scope 2) in thepast 3 years(kilograms of carbon dioxideequivalent/CNY10,000)
18.19
12.42
Greenhouse gas emissionperformance >
>Carbon neutral certificate
4950
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Electricity consumption per CNY10,000of revenue in the past three years (kWh/CNY10,000)
Natural gas consumption per CNY10,000of revenue in the past three years (cubicmeters/ CNY10,000)
20212021
26.250.64
25.010.58
19.91
0.45
2022202220232023
Resource conservation
Our production, operations, and of?ce activities directly or indirectly consume elec-tricity, natural gas, gasoline, and diesel. We have developed energy managementsystems such as the Power Saving Management System and the Natural Gas LeakageEmergency Plan. We constantly improve the usage ef?ciency of energy and optimizethe use structure of energy.
In our of?ce operations, we advocate for a green of?ce. Proya strictly adheres to theDaily Power Saving Plan of Proya Building and the Orderly Power Consumption Regu-lation Plan of Proya Building, encouraging employees to turn off lights and air condi-tioners when leaving the company to avoid wasting energy. To minimize of?ce powerconsumption, we take measures such as turning off certain air conditioners in theof?ce area and reducing excess underground lighting on the premise of ensuing thebasic needs of employees.During the Reporting Period, our use of clean energy accounted for 35.35%, with a
20.39% decrease in electricity consumption per RMB10,000 of revenue and a 22.81%
decrease in natural gas consumption per RMB10,000 of revenue.
New energy-saving and emissionreduction measures and theirperformance in production andoperation processes >
Energy managementperformance >
Main MeasurePerformanceInstalled matched cooling towers to preventfouling on the heat exchange pipes in thecondenser, resulting in a 10% increase in theoperating ef?ciency.Added a set of three CIP (clean-in-place) tankdevices. Reduced natural gas and electricityconsumption resulting from the separateovertime operation of the boiler and the airconditioner associated with tank cleaning.
After the renovation, the average annualelectricity consumption was reduced by
120 megawatt-hours.After the renovation, the average annualconsumption of natural gas was reducedby 36,000 cubic meters and the con-sumption of electricity was reduced by72 megawatt-hours.
Energy managementThe water resources we use for production and operation mainly derive from the mu-nicipal water supply, and the water source has no signi?cant impact on the environ-ment. In the Huzhou skincare factory, we established the Water-Saving ManagementSteering Group, which is solely responsible for water-saving management work. TheGroup builds the evaluation, reward, and punishment mechanism for water saving,and improves the water metering system, the standardization of water use behavior,and the continuous improvement of water utilization ef?ciency.In 2023, the Huzhou skincare factory conducted a water balance test analysis to assesswater-saving opportunities and develop improvement plans. During the Reporting Pe-riod, Proya Huzhou Factory was honored as a water-saving enterprise for the year 2023.
Major water-saving measure andperformance >
PerformancesMeasures
The Huzhou skincare factory conducted a water balance test to gain afull view of the current water usage. It also drew a water balance dia-gram to analyze improvement measures for water conservation.Water balancetest
Recycling of cooling water: The Huzhou skincare factory built coolingwater circulation pools in the workshop. The cooling water is reusedand discharged regularly.Sewage ?ltration and reuse: The Huzhou skincare factory built a sewagetreatment system. Through ?ltration treatment, the system can reuserecycled water such as toilet water and landscape pool water, reducingthe amount of fresh water used.Reuse of concentrated water from the pure water preparation unit: Theconcentrated water produced by the pure water preparation unit is re-used as toilet water and landscape pool water.Reuse of steam condensate water: Steam condensate water is collectedand reused in the cleaning process, which utilizes steam waste heat andwater resources.
Water recycling
Equipmentupgrade
The automatic cleaning system of CIP efficient tanks saves 2,000t ofwater annually.
Water resource management
Water consumption per CNY10,000of revenue in the past three years(cubic meters/ CNY10,000)
Total recycling water volume in the pastthree years (cubic meters)
20212021
0.4515,000
0.413,000
0.31
19,000
2022202220232023
Water resource managementperformance >
5152
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
The raw materials we use mainly include base materials for products, functional ingre-dients, active ingredients, additives, and packaging materials. Our key managementmeasures for raw materials include ef?cient use of raw materials, sustainable procure-ment of raw materials, quality management of raw materials, and enhancement ofpackaging sustainability.In terms of raw material use and conservation, we implement excellent performanceand lean management, and encourage employees to propose improvement sugges-tions at any time during production. We seek to reduce the scrap rate and improvethe usage ef?ciency of raw materials. We collect improvement suggestions from em-ployees and regularly recognize those employees.In addition, for information on the management of "sustainable procurement of raw ma-terials", please refer to the “Sustainable procurement” section of this Report. For detailson raw material quality management, please refer to the “Product quality and safety”section of this Report. For information on the management of packaging sustainabilityenhancement please refer to the “Green packaging” section of this Report.
Our green packaging management and practices cover a variety of product pack-aging across the whole production process, including finished product packaging,intermediate packaging, and warehousing and logistics packaging. Proya follows the3R (reduce, reuse, and recycle) design philosophy. We are committed to reducing theuse of packaging materials at the source to further achieve lightweight packaging andimprove the packaging utilization rate and recovery rate.
Raw material management
Green packaging
Green Packaging Working Group
Green packaging managementprocess >
In the packaging design stage, we take various design measures, such as reducingpackaging, improving packaging materials, and using alternative packaging and re-cyclable packaging, to reduce the use of disposable plastic packaging and increasethe packaging recovery rate.Packaging design
In the packaging procurement stage, we prioritize the procurement of sustainablepackaging.Packaging procurement
In the warehousing and logistics stage, we apply various methods, such as recyclingand improved packaging design, to reduce the use of cartons and disposableplastics.Warehousing and logisticsIn the factory production stage, we recycle and replace the packaging and contain-ers used in internal logistics to generate less packaging waste.Factory production
Key actions for green packaging >
Structure of the Green PackagingWorking Group >
Action and ResultAspect
Streamlined the packaging design of Advanced Firming NourishingLight Cream 3.0
: Compared to Advanced Firming Nourishing LightCream 2.0, the weight of Advanced Firming Nourishing Light Cream 3.0was reduced by 22%.The Advanced Firming Nourishing Light Cream 3.0 became availablewith re?llable options. Compared with the original design, each re?ll-able option reduces the use of plastics by over 100 grams.
Reduce
Recyclable cartons were promoted to all the warehouses of flagshipstores nationwide (Tianjin, Guangzhou, Chengdu, Wuhan, Hangzhou,Huzhou, Changsha). A total of 529,000 cartons were shipped, amount-ing to a save of 500 tonnes of paper for packaging.Factories began using mobile stainless steel storage tanks instead ofblue plastic buckets or PE plastic bags, reducing the use of 13500plastic bags.
Recyclable winter incubators were used for transportation in NortheastChina and Northwest China in replacement of disposable foam incuba-tors. The annual usage reached 3,500 incubators.
Reuse
RecycleProya participated in the plastic recycling program of the Intime De-
partment Store, calling consumers to recycle plastic bottles and raiseawareness of recycling.Furthermore, we integrate our environmental protection concept into productand packaging design, and promote refillable options and empty bottle recyclingprograms through various channels such as Weibo, Little Red Book, and overseasplatforms. Our purpose is to promote the recycling value of refillable options toconsumers and enhance their awareness of environmental protection.
The Advanced Firming Nourishing Cream 3.0 series covers Advanced Firming Nourishing Moisture Cream.Advanced Firming Nourishing Soft Cream, and Advanced Firming Nourishing Light Cream
Product Development DepartmenteProduct Design DepartmentProcurement Department IMake-up Procurement DepartmentSkincare FactoryMake-up FactoryFactory Logistics DepartmentPlanning Operations DepartmentE-commerce Logistics Department&
5354
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Measures for guiding consumerstoward sustainable consumption >
Packaging managementperformance >
Packaging weight of 2023 (by type)
Developed and launched refillable options of products, encouraged con-sumers to buy re?llable options, and reduced unnecessary packaging waste.Used recyclable packaging materials to improve the sustainable attributesof packaging.
Functional design
OR and Hapsode both launched empty bottle recycling programs, callingon consumers to better reuse and repurpose bottles.Proya participated in the plastic recycling program of the Intime DepartmentStore, calling consumers to recycle plastic bottles and raise awareness ofrecycling.
Use guide
Proportion of sustainable packag-ing materials used (%)
Packaging intensity (t/10,000 pieces)
Glass 19%
Other 2%
Paper 55%Plastic 24%
The waste water we produce mainly comes from domestic sewage and productionwaste water and is discharged to landscape water pools or to the outside througha consolidated water pipe after being treated by the sewage treatment station. Thewaste gas produced mainly comes from boilers. We have formulated theSewageTreatment Management System,theBoiler Management System, and other manage-ment documents to strictly control the discharge of waste water and waste gas. Duringthe Reporting Period, we discharged waste water and waste gas up to standards.
Emission and waste managementWaste water dischargeand waste gases
Emission StandardObserved
Main Control Indicator
Management Measure
Category
PollutantCategory
Integrated Emission Standard ofAir Pollutants (GB 16297-1996)Emission Standard of Air Pollut-ants for Boilers (GB 13271-2014)
Integrated Waste water Dis-charge Standard (GB 8978-1996)
Five-day biochemical oxygen demand(BOD5) 300 mg/L, chemical oxygendemand (CODcr) 500 mg/L, suspendedmatter 400 mg/L, ammonia nitrogen 35mg/L, animal and vegetable oil 100 mg/L, and othersNitrogen oxides 50 mg/lim3, particulatematter 20 mg/m3, sulphur dioxide 50mg/m3
Construct a waste water treatment system to ensure that the treatedwaste water is highly purified and recycled.Install the Multi Vision COD online automatic monitoring instrument tomonitor the COD content in treated water 24 hours a day.During the Reporting Period, a new sludge pressing device wasinstalled at the Huzhou factory, which effectively removes organicsubstances from the waste water and further improves the sewagetreatment capability to ensure class-A sewage discharge.During the Reporting Period, we excavated, replaced, repaired andretested some damaged rain and sewage pipes in the factory area inaccordance with the results reported by the underground pipelineCCTV detection system.A waste gas treatment facility for the cream production line was addedto reduce the emission of dust and organic waste gas. After being used,the facility can collect 99% dust and remove 75% organic waste gas.A highly precise volatile organic chemical (VOC) gas collection devicewas installed to effectively reduce uncontrolled gas emissions.
Wastewater
Waste water
Waste gas
Wastegas
Waste water discharge and waste gasstandards & main control indicators >
Primary measures for managing wastewater discharge and waste gases >
20212021
1.1
7.04
25.47
1.15
2022202220232023
0.16
0.94
5556
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
We properly dispose of solid waste generated in production and operations. Wemanage solid waste in a macroscopical manner and our factories can track the wholeprocess data on solid waste and prevent risks by requesting to report the amountof generated hazardous waste on the Zhejiang Information System Platform for theSupervision of Solid Wastes every year, selecting hazardous waste treatment serviceproviders through open bidding on the platform, and requesting for the treatment ofhazardous waste on the platform.During the Reporting Period, the sludge pressing device at the Huzhou factory re-duced sludge production by 75%, resulting in an annual reduction of approximately540 tonnes of sludge.
Solid waste
Waste
Main TreatmentMeasure
Reference StandardCategory
Domestic waste, cartons,tape, ?lm, paper, andothersLined bags, expiredproducts, waste ?ltermembranes and ?lters,sewage sludge, domesticwaste, canteen wasteHazardous reagents,waste oil, waste ink inlaboratories
Standard for PollutionControl on MunicipalSolid Waste Incineration(GB 18485-2014)
Identi?cation Standardsfor Hazardous WasteGeneral Rules (GB 5058.7-2019)
Collected, and thenrecycled or resoldRegularly handedover to a quali?edagency for treatmentRegularly handed overto a quali?ed agencyfor treatment
Generalwaste
Hazardouswaste
Main measures and implementationstandards for solid waste treatment >
Solid waste discharge performance >Discharge of general waste per CNY10,000 of revenue (kg/CNY10,000)
Discharge of hazardous waste per CNY10,000 of revenue (g/CNY10,000)
2021
2021
1.62
2.16
1.99
1.53
1.84
0.65
2022
2022
2023
2023
Product and Customer Responsibility
Proya takes innovation in research and development as an area of core competitive-ness and builds a comprehensive R&D innovation framework and management sys-tem. Adhering to a “consumer-centric” concept, we fully consider consumers’ needsbased on dermatology, and apply this concept throughout the whole process fromraw materials to ?nished product development, including fundamental research, for-mula development, physical and chemical analysis, and assessment of raw materialsand product ef?cacy.In 2023, Proya’s Longwu R&D Center and Shanghai R&D Center were put into operation.The two centers are equipped with laboratories catering to different functions and arefurnished with advanced experimental instruments, thus enhancing our capabilities inindependent research and development. Additionally, we have established a researchand development center for makeup base to enhance the development and competi-tiveness of makeup base products.We continue to increase investment in research anddevelopment. During the Reporting Period, the investment in research and develop-ment reached CNY173.5701 million, accounting for 4.13% of the revenue of the parentcompany.
Innovations in researchand development
The proportion of scientific researchinvestment in the revenue of the parentcompany
is
Product health andsafety violations
4.13
%Performance highlights
The “revenue of the parent company” here refers to the revenue of Proya Cosmetics Co., Ltd., excluding therevenue of its subsidiaries.
R&D teammembers
master’s degree or abovedoctoral degree or above
41.6%
2.48%
5758
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
In 2023, our research and development focus was on the construction of three majortechnology platforms in chemical synthesis, biotechnology manufacturing, and plantextraction. During this process, we continued to re? ne precise analytical testing meth-ods and support the research, development, and ef? cacy veri? cation of new ingredi-ents, ultimately enhancing our R&D ef? ciency.
R&D investment in the past three years(Unit: RMB100 million)
Proportion of scienti? c research investmentin the revenue of the parent company (%)
20212021
3.55
1.28
1.73
4.13
2022202220232023
0.77
4.31
Research and development layout >
R&D investment >
We have a professional, diversified, and innovative R&D team comprising high-caliberprofessional researchers in different disciplines such as skin science, biochemistry, lifescience, material science, medicine, industrial design, psychology, and statistics. In2018, we licensed and established the Zhejiang Postdoctoral Workstation as a part ofour efforts to deepen the training of high-level personnel. In 2023, the managementtrainee project of our R&D team admitted 32 outstanding members to enrich ourtalent pool. Currently, 41.6% of the R&D team members hold a master’s degree or aboveand 2.48% hold a doctoral degree or above. For selected R&D talents, we plan for jobrotation schedules, promote the exchange of knowledge, new industrial technologiesand results among them, and provide specialized R&D training to enhance theirresearch and development capabilities.To fully stir up the innovation enthusiasm for R&D personnel, we continuously improveour talent incentive measures by revising the Intellectual Property ManagementRegulations and setting up rewards for papers and patents to encourage R&Dpersonnel to enhance their research capabilities and promote technologicalinnovation in the company. Meanwhile, we actively recommend patent researchprojects as well as opportunities to cooperate with universities and receiveprofessional titles for eligible R&D personnel, so they can be better recognized by theindustry.We attach importance to external R&D cooperation and continuously deepencooperation. In terms of international strategic cooperation, we have establishedpartnerships with BASF in Germany, Lipo True (a Spanish family peptide company),Ashland (an American special materials expert), and other global technologicallaboratories. In terms of the integration of industrial, academic, and researchcapabilities, during the Reporting Period, we collaborated with Beijing Technologyand Business University, Zhejiang University, Jiangnan University, and other highereducation institutions to actively promote the integration of industrial, academic, andresearch capabilities. Also, we take an active part in industrial exchange and share ourpractices with industrial peers, helping the industry grow healthily.
Application and achievements of ourtechnology platforms >
Main FunctionTechnologyPlatform
Based on known ef? cacy targets, the platform designs speci? c mo-lecular structures and seeks synthesis possibilities.The platform screens specific microorganisms or strains, andachieves the biosynthesis of active ingredients through AI simulationand biological computation.The platform extracts plant components such as flavonoids, poly-phenols, and polysaccharides with technologies, and then puri? esand condenses functional products.
Chemical synthesisBiotechnologymanufacturingPlant extraction
Shanghai R&DCenterFocus on scalp skinmechanism, ecology, andhair washing and main-tenance, and carries outfundamental, applica-tion, and clinical ef? cacyresearch.
Research anddevelopment layout
Longwu R&DCenterFocus on cutting-edgeskin mechanism study,new material design anddevelopment, formula de-velopment and validation.
5960
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Cooperative UniversitiesResearch Achievements
Beijing Technology andBusiness UniversityHangzhou DianziUniversityJiangnan University
Research on the Mechanism and Improvement Ap-proaches of Enlarged Skin PoresBall Milling of Titanium Dioxide and Zinc Oxide for Im-proved UV ProtectionPlant Cyclic Peptide and Their Potential Applications inthe Cosmetics Industry
Achievements of externalcollaborations >
In 2023, we actively participated in industrial exchanges, such as the 2023 NationalConference on Integrated Traditional Chinese and Western Medicine for Dermatolo-gy and the IFSCC Conference. During those events, we shared our practices with theindustry and contributed to its high-quality development.
Highlights and recognitionsof research, development,and innovation >
Submitted 47 new patent applications and was granted 15 invention patents.Launched 76 new products
.Successfully registered the new cosmetic ingredient “3,3,5-TRIMETHYLCYCLO-
HEXYL SUCCINATE DIMETHYLAMIDE.”Published 2 journal articles,including “Skin Health and Disease” (a core journal ofthe British Association of Dermatologists) and “Journal of Daily Chemical Industry” (acore journal of the Chinese daily chemical industry) and 6 English posters,includingIFSCC 2023 (International Federation of Societies of Cosmetic Chemists) and the2023 Annual Meeting of the International Federation of Cosmetic Chemists.Participated in the development of 3 national standards and 12 group standards, in-cluding GB/T 43197-2023Determination of Prohibited Acid Red 73 and Solvent Red1 in Cosmetics - Liquid Chromatography - Tandem Mass Spectrometry and Valida-tion Criteria for Analytical Results of Cosmetics Using Chromatographic Techniques.
Led or participated in the development of 17 national standards, 4 light QB/Tindustry standards, and 26group standards.Obtained 256 valid patents, including 122 invention patents.
During the Reporting Period, Proya:
As of the end of the Reporting Period, Proya had:
The new products here refer to completely new products, products with upgraded formulas, products withupgraded packaging, and products with minor innovations.
We strictly abide by the Regulations on the Supervision and Administration of Cos-metics, the Code for Quality Management of Cosmetics Production, the Safety andTechnical Standards for Cosmetics, and other laws and regulations. To ensure thequality, safety, and ef?cacy of products, we perform quality management throughoutthe entire process from product R&D and production to post-market. During the Re-porting Period, we completed the missing registration of product information in ac-cordance with the new requirements speci?ed in the Regulations on the Supervisionand Administration of Cosmetics, ensuring the compliance of products.
Product qualityand safety
In product development, we focus on the safety and efficacy of raw materials andformulas. We have formulated the Product Anti-Corrosion Energy Efficiency TestProcess, the Human Patch Test Process, and other systems to standardize the qualityand safety control of product development. In addition, we comprehensively evaluatenewly developed formulas, and upgrade original formulas and functional and activeraw materials to ensure product safety and outstanding efficacy. During the ReportingPeriod, we formulated the Regulations on New Product Development to standardize thenew product research and development procedure, aiming to achieve procedural, stan-dardized, and ef?cient R&D processes, thereby enhancing our management capabilities.We comply with national requirements for cosmetics registration and filing andconduct product inspections and safety testing of physical and chemical microbialindicators. We established the Analysis and Test Department and the ProductEvaluation Department under the R&D Innovation Center to evaluate the quality ofproduct development. We designed a sophisticated safety evaluation system thatincludes stability, anti-corrosion tests, sensory evaluation, in vitro efficacy evaluation,cytotoxicity evaluation, animal toxicology experiments, clinical test evaluation, andtests performed by dermatologists. In addition, we conduct human patch tests, eyeirritation/corrosion tests using chick embryo chorioallan toic membranes, zebrafishtests, and lactic acid tingling tests to reduce the potential adverse skin reactionscaused by cosmetics in humans.We also actively establish and develop in vitro evaluation methods to replace animalexperiments. We have set up a technology evaluation module within the InternationalAcademy of Sciences to evaluate the safety and efficacy of key functional raw materialsand products. We have established more than 20 in vitro evaluation methods such asin vitro moisturizing; whitening and freckle removal; soothing and anti-inflammatoryfunctions; anti-oxidative, anti-aging and other efficacy evaluations; toxicologicalstimulation; and other safety evaluations at the biochemical, molecular, cellular, and3D model levels. We have the preliminary ability to conduct in vitro efficacy andsafety evaluations of major cosmetics such as those for anti-aging, whitening andfreckle removal, soothing and stimulation, as well as to conduct research on efficacymechanisms.
Quality management inproduct R&D
6162
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Certification
KPIs in ProductionQuality
Scope of Certification
Target
Valid Period ofCertification
Performance in 2023Skincare FactoryMakeup Factory
ISO 22716 Cosmetics - GoodManufacturing Practices (GMP)
First-pass yield of theproduction processAcceptability of spotchecksRate of quality-related complaintsIQC pass rateClose rate of defectsin managementsystem review
ISO 9001:2015ISO 9001:2015ISO 22716 Cosmetics - GoodManufacturing Practices (GMP)
US FDA CFSAN Cosmetics - GoodManufacturing Practices (GMP)
US FDA CFSAN Cosmetics - GoodManufacturing Practices (GMP)
Proya Cosmetics Co., Ltd.
≥99%100%≤2ppm(reject ratio per 1million products)≥99%100%
Proya Cosmetics Co., Ltd.Zhejiang Beauty CosmeticsCo., Ltd.Zhejiang Beauty CosmeticsCo., Ltd.
Proya Cosmetics Co., Ltd.
Zhejiang Beauty CosmeticsCo., Ltd.
2026.5
99.66%100%
100%100%≤1.22ppm≤0.59 ppmRaw materials IQC passrate 98.73%Packaging materials IQCpass rate 99.18%
Raw materials IQC passrate 100%Packaging materialsIQC pass rate 94.8%100%100%
2025.22024.3(under reviewfor renewal)
2026.5
Quality managementsystem certification >
Key performance objectives andperformance of production factories >
During the production stage, Proya upholds the quality control philosophy of processcontrol, quality and safety, and customer satisfaction, and has established a well-de-veloped quality management system. We have developed the Proya ManagementManual, the Deviation Control System, the Non-Conformance Corrective Action Con-trol Procedures, and other systems to standardize quality control and deviation man-agement at all stages from raw materials and production to delivery. Quality objec-tives are set at all stages and strict quality monitoring is applied to guarantee productquality across the board. The skincare factory and the makeup factory are responsiblefor managing product quality and developing quality audit plans to ensure that thequality management in the production process meets industry and company stan-dards. During the Reporting Period, we formulated the Management System for Safe-ty Testing of Innovative Raw Materials and the Management System for Lubricants,and revised the Raw Material Quality Management Specifications, the Quality andSafety Responsibility System, and the Quality Management System Self-InspectionMechanism. Our purpose was to improve the quality management in the productionprocess and ensure our quality management measures comply with legal regulationsand industry standards.
Quality management inproduction
We further improved our quality assurance and quality control standards, optimizedthe con?rmation process of product production, and established an audit mechanismto check product quality, which was agreed upon by departments, including research,development, and factories. We perform internal quality audits regularly to identifypotential quality management improvements. Then, we develop corresponding im-provement measures.
Quality control at theproduction stage
Formulate a raw material management system, set acceptance standards, and stan-dardize evaluation methods, and ensure each department strictly abides by the reg-ulations of various documents.Develop the Management System for Safety Testing of Innovative Raw Materials toconduct full-lifecycle monitoring of new materials used in China for the ?rst time.Adopt a raw material shelf-life control system and set quality control indicators forraw materials, including physiochemical, microbiological, and infrared spectrum ?n-gerprint control.
Raw material control
Formulate the Packaging Material Management Specifications and other systems.Evaluate packaging samples and small-lot trial production of packaging.Set up an inspection plan and release products only after they pass all inspections.Packaging material control
Formulate process specifications in strict accordance with the production processapproved by the state, and manage the production process in a standardizedmanner.Develop evaluation specifications for semi-finished products and set quality controlindicators such as physiochemical, microbiological, and preservative additions.Sample every lot of semi-finished products and regularly re-check inventory.
Manufacturing process
Carry out first-piece control and in-process control, and manage the quality of thepacking process.The MES system launched in 2021 collects quality data during the productionprocess to realize real-time sharing of on-site quality information and informationtraceability.
Packing control
Perform quality control of products against quality standards, including physical andchemical, stability, and heavy metal inspections. Products can only be released afterpassing these inspections.
Finished product control
Establish the Labeling and Traceability Control Procedures in strict accordance withthe requirements of laws and regulations.Ensure production records on the labels of all delivered products are traceable andinclude lot number, specification, process, and inspection records.Ex-factory inspection
To ensure product quality, the Company establishes inspection criteria for each raw material and carriesout inspections strictly. For raw materials that do not meet Proya's standards, the Company handles themappropriately based on management systems such as "Raw Material Quality Management Specification,""Quality and Safety Responsibility System," and "Quality Management System Self-Inspection System." In 2023,the Company added new inspection criteria for raw materials and increased the requirements for raw materialquality management. As a result, the qualification rate of incoming raw materials has slightly decreased.
6364
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
We have complete in-house testing capabilities and advanced equipment and in-struments. Our various safety and ef?cacy tests are conducted throughout the entireproduct R&D process, covering the whole lifecycle of raw materials, packaging materi-als, semi-?nished products and ?nished products to ensure that the products reachingconsumers are safe and effective. The equipment includes the Vision Swift Duo inte-grated video and optical measurement system from the UK, Olympus wall thicknessgauge, SUNTEST light aging tester from America, Agilent high-performance liquidchromatograph from America, and inductively coupled plasma emission spectrometer(ICP-OES). During the Reporting Period, we introduced the Agilent high-performanceliquid chromatography from America and the sealing and leakage intensity tester for?exible tube masks on the production line. These allow us to measure the appearanceof packaging materials, wall thickness, ?lm thickness, hardness of electroplated coat-ing, adhesion of surface printing and electroplated coating, light aging performance,impact resistance, solvent resistance, airtightness, fatigue properties, and compatibil-ity. We can also determine the content of preservatives, heavy metals, and sunscreenagents in cosmetics, and the content of prohibited and restricted substances stipulat-ed in the Safety and Technical Standards for Cosmetics. In 2023, we developed a phys-ical sunscreen content testing method, a preservative content testing method, and aphysical and chemical PH water-in-oil product testing method in accordance with theSafety and Technical Standards for Cosmetics to enhance our self-testing capabilities.We carry out internal quality management training to align employees with our qualityrequirements and standard management procedures. Meanwhile, we conduct qualitytraining and quality review meetings with suppliers to update them on Proya’s qualitymanagement systems and standards and share with them our quality managementmeasures and cases, so as to help them improve their quality management capabilities.During the Reporting Period, we passed 12 external audits from regulatory unitsand collaborative units. Additionally, we did not encounter any punishment relatedto quality and safety, nor did any lawsuit arising from the above matters occur.To protect the rights and interests of consumers, we have formulated the Product Re-call Management and Product Recall Control Procedures to immediately stop sellingand recall sub-standard products already sold or in transit. We conduct an annualproduct recall rehearsal to ensure the recall procedure is running effectively.During the Reporting Period, we did not encounter any product recall events. We alsorehearsed the recall of products due to customer complaints attributable to suppliers.The entire process took 8 days from the ?ling of customer complaints to the issuanceof recall letters, and ?nally to the return of products. Also, we require suppliers to takecorrective actions based on the Eight Disciplines Problem Solving (8D) method withinthe speci?ed time frame[The 8D method covers 8 steps and is used to systematicallyaddress quality issues through collaborative teamwork. It is commonly used in theautomotive industry.], and their performance will be evaluated accordingly. This recallrehearsal veri?es the availability of recall procedures and traceable management sys-tem processes, and ensures the suitability and conformity of our management system.
Post-market qualitymanagement
The 8D method covers 8 steps and is used to systematically address quality issues through collaborativeteamwork. It is commonly used in the automotive industry.
During product research and development, we monitor the chemical ingredients weuse to ensure their safety. Proya strictly abides by the requirements of laws and regu-lations such as the Safety and Technical Standards for Cosmetics and the Catalog ofAlready-Used Cosmetic Raw Materials (2021 Edition). We do not use prohibited ingre-dients, including but not limited to more than 2,000 ingredients banned by the Cata-log of Prohibited Cosmetic Raw Materials and the Catalog of Prohibited Plant (Animal)Raw Materials for Cosmetics, such as hydroquinone, phenol, retinoic acid and its salts,glucocorticoids, and antibiotics.On this basis, we adopt stricter standards than Chinese laws and regulations to regulatethe selection of raw materials for cosmetics. By referring to the ingredients and dosagesin the relevant standards of the European Union, South Korea, and Japan, we prohibitthe use of controversial ingredients in the development process of new products.
Chemical safety
International safety standards for importantchemicals we refer to
European Commission
South Korea
Japan
LIST OF SUBSTANCES PROHIBITED IN COSMETIC PRODUCTSLIST OF SUBSTANCES WHICH COSMETIC PRODUCTS MUST NOT CONTAIN EXCEPT SUBJECTTO THE RESTRICTIONS LAID DOWNLIST OF COLORANTS ALLOWED IN COSMETIC PRODUCTSLIST OF PRESERVATIVES ALLOWED IN COSMETIC PRODUCTSLIST OF UV FILTERS ALLOWED IN COSMETIC PRODUCTS
Types and Restrictions of Cosmetic Colorants
Cosmetics Benchmark - List of Prohibited and Restricted Substances
6566
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Chemical safety management procedure
Management procedure for chemicals of concern
Development and selection of raw materials
Retrieval
Tracking
Review and identificationAssessment
Information disclosure
Adjustment
Develop the Speci?cations for the New Raw Material Development Process to standardize theresearch and development of new materials and ensure that new raw materials are developedin a compliant and safe manner.Prohibit the use of controversial ingredients that are identi?ed by laws and regulations, industrystandards, academic ?ndings, and the internal list of chemicals of concern in the developmentof new products.Require suppliers of chemical raw materials to conduct safety assessments and provide toxicol-ogy test reports for chemical raw materials.
Regularly retrieve laws and regulations, industrial standards, and relevant rules related to thesafety of chemical raw materials, identify new policies as well as controversial chemical com-ponents and those of concern, update the internal list of chemicals of concern and the list ofbanned substances, and improve the compliance of chemical management.
Monitor chemicals, update the internal list of chemicals of concern, and continuously improvethe management of chemical records based on laws and regulations, industry policies, andthe inquiry result of academic ?ndings; inform relevant authorities of the updated content, andgradually reduce the usage of chemicals of concern.Run tests on chemical impurities, and use chemicals with fewer impurities on the premise ofensuring product safety.Develop the Management System for Safety Testing of Innovative Raw Materials to conductfull-lifecycle monitoring of new materials used in China for the ?rst time.Set acceptance standards for raw materials, adopt a raw material shelf-life control system andset quality control indicators for raw materials, including physiochemical, microbiological, andinfrared spectrum ?ngerprint control, and guarantee the safety and effectiveness of chemicals.
Review chemicals of concern, identify chemicals of concern and associated products, and im-prove the management of chemical raw material records.Assess the use of chemical raw materials of concern, ensure relevant departments conductevaluations and make decisions, and develop a plan for upgrading and phasing out formulas.
Disclose the list of replaced chemical ingredients and the complete formula of hero products onthe of?cial website, protecting consumers’ right to know about product ingredients.
Strictly prohibit the usage of ingredients prohibited by laws and regulations.Gradually phase out and reduce the use of controversial ingredients in accordance with theingredient upgrade program for controversial ingredients disputed in clinical research, industrypolicies, and market feedback.Update the product filing information after the adjustments.
As for chemicals of concern, we have established a complete management procedureto ensure the proper management of these chemicals and to address the concerns ofstakeholders through solid action.
NumberName of Raw MaterialProgress of Replacement
Iodopropynyl butylcarbamate (IPBC)Kojic acidAvobenzoneTriclosanLyralImidazolidinyl ureaDiazolidinyl ureaZinc pyrithione (ZPT)MethylisothiazolinonePropylene glycolParabenMineral oilIsopropyl myristateCocamide DEATalcum powderButylated hydroxytoluene (BHT)PhenoxyethanolEmulgator containing PEGArtificial color
Mixture of CMIT/MIT and magnesiumchloride/magnesium nitrate (CMIT:MIT=3:1)
ReplacedReplacedReplacedReplacedReplacedReplacedReplacedReplacedReplacedGradually being replaced (nolonger used in key products)Gradually being replaced (nolonger used in key products)Gradually being replaced (nolonger used in key products)Gradually being replaced (nolonger used in key products)Gradually being replaced (nolonger used in key products)Gradually being replaced (nolonger used in key products)Gradually being replaced (nolonger used in key products)Gradually being replacedGradually being replacedGradually being replaced
ReplacedList of ingredients replaced overthe years >
Note:
We update the list of component replacement in real time. For speci?c and up-to-date information, pleaserefer to the of?cial website.Raw materials numbered 5, 6, and 9 were replaced due to regulatory requirements,while the remaining raw materials were voluntarily replaced.
Our chemical safety management runs through all stages from R&D to post-market.During the stage of product development and ?ling, we invite professional third-partyinstitutions to jointly conduct product safety assessments and adjust ingredients ac-cording to the clinical research results and market feedback.
6768
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Adhering to the concept of heartfelt service and sincere hospitality, Proya is commit-ted to providing consumers with a premium customer service experience. We havebuilt a smooth online and of?ine customer service channel to provide consumers withpre-sale, in-sale, and after-sale inquiries, consultation, and complaint services. Weregularly organize training for marketing personnel to continuously improve their pro-fessionalism and service capabilities. We also regularly carry out customer satisfactionsurveys and collect consumer opinions and suggestions to optimize the consumerservice experience.In terms of consumer communication, we build consumer feedback channels to listento their opinions and suggestions, provide Q&As and after-sales services for consum-ers, and track them after the purchase. To collect improvement suggestions, we carryout consumer communication and collect feedback on products, services, and oper-ations through return visits for evaluation, satisfaction surveys by phone, and othermethods.
Consumer communicationchannels >
Customer service and rights protection
In terms of consumer complaints, we have established a comprehensive com-plaint-handling channel linking our sales, R&D, and customer service departments totimely handle consumers’ feedback and questions on user experience, after-sale ser-vice, and product improvement suggestions.
Consumer services
Social mediaE-commerce
customer service
Customerservice center
Official websiteOffline storesSatisfaction
surveys
Method and procedure for handlingcomplaints >
Customerservicechannels
Offline stores
Proya VIP center onWeiboE-commercecustomer service
24-hour servicehotline
User experience
Customer service personnel answer the questions ofusers immediately and provide professional suggestionsand solutionsAfter-salesexperience
User needs are recorded and reported to the customerservice department and other relevant departments tosolve the issues encountered by users as soon as possibleand maximize their rights and interestsProductoptimization
Products are sorted and monthly reports are generatedand sent to the R&D Department for product upgradesand improvementsProduct qualitycomplaints
Factories, R&D, and quality departments work togetheron troubleshooting and implement targeted measuresaccording to problem severity to reach a consensus withconsumers and maximize their rights and interests
FeedbackCommunication
Handling Method
6970
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Measures for consumerexperience optimization >
In terms of consumer service ability improvements, we are committed to building aprofessional and ef?cient consumer service team through talent training and businessinnovation. In terms of consumer satisfaction surveys, our business departments carryout annual consumer satisfaction surveys and collect consumer opinions on products,logistics, and services to learn about consumer needs. Additionally, we organize physi-cal product salons and provide training for distributors on products and services to en-hance the of?ine service experience. In 2023, the Proya and TIMAGE brands integratedpre-sales and after-sales customer service management to a higher degree, helpingthe customer service team quickly address customer issues and reduce waiting time.
Reduce the use of customer service bots and provide a 24-hour manual onlineservice to improve the consumer interaction experience
Pursue “quick reply in 30 seconds” to respond to consumer questionsUse unified tickets to record after-sales issues and carry out closed-loopmanagement to ensure that the issues are fully handledFollow up the early warnings and alerts on consumer services on the e-commerceplatform to promptly improve the consumer experience
Consumption Process Experience Improvements
Product Usage Experience Improvements
Update products according to consumer feedback after product launch toimprove the user experience in relation to the products themselves
Progress and achievements ofconsumer experience optimization >
WorkAchievements
ConsumerCommunication
Enhancementof ConsumerExperiences
Improvementof CustomerServiceCapabilities
ProyaFormulated a line of customer service managementdocuments such as the Channel Management Mech-anism, the Pre-Sales and After-Sales Handling Stan-dards, and the Quality Inspection Management Stan-dards to re?ne the customer service process.
The one-time resolutionrate for customer issuesreached 80.38%.
In 2023, the one-time res-olution rate for customerissues reached 73.08%.
Singuladerm 8.7 ,SOSAnti-aging Beauty Optimiz-ing Complex 7.5 points,and Singuladerm ExpertContour 9.8 points.
2,233 consumer product
salons were held.
187 product training ses-sions were held.The 24-hour pick-up time-liness ratio increased from
86.53% to 99.21%.
The delivery time wasreduced by 24.65 hourscompared to 2022.The error rate was reducedto as low as 0.003%.Training was provided forover 300 store managers toimprove service standards.The Proya PCA Academyhas over 800 trainees, of-fering 86 courses totaling
423 hours of study time.
There are 134 exam ses-sions with a total of 5,547participants.
(Increased by 1.35% comparedto 2022)
(Increased by 10.30% comparedto 2022)
TIMAGE
Established an active service team to provide end-to-end services from consultation and order ful?llment toafter-sales support.Provided complete and diverse solutions to help con-sumers and customers make quick decisions.Offered privileges for after-sales service, including thefast-track service for the ?rst order.
Singuladerm
Conducted a product satisfaction survey that coveredskin feel, ef?cacy, packaging, and pricing. The survey
helped the brand understand consumers’ use experi-ence and provided feedback to relevant departments toenhance overall consumer satisfaction.ProyaProvided consumers with outstanding product experi-ences at bricks-and-mortar stores.Updated product information with sales staff and dis-tributors to enhance their understanding of productsand deliver better customer services.TIMAGEOptimized warehouse operation to improve warehous-ing ef?ciency.Optimized the allocation of logistics service providersto improve the accessibility of logistics services.Continuously optimized packaging solutions and logis-tics operation standards.Anya, UZEROProvided training for store managers, covering brandand product knowledge, skincare expertise, and serviceskills.
Proya
Established the Proya PCA Academy to provide onlinecustomer service training, thereby enhancing the busi-ness competence and product expertise of customerservice personnel and providing consumers with premi-um services and experiences.Conducted on-site quality checks for customer service,engaged in one-on-one communication with customerservice personnel based on customer feedback, andanalyzed and reviewed feedback to help them improvetheir customer service capabilities.
Singuladerm conducted a satisfaction survey for its own products, capped at 10 points.
In terms of consumer feedback, we collect consumer comments on the Tmall CustomerVoice module every month and hold monthly consumer service meetings. To improveinternal management mechanisms, we coordinate with our sales, R&D, factory, and cus-tomer service departments to follow up on and handle consumer feedback and ques-tions on user experience, consumer services, product optimization, and logistics service.In terms of optimizing the consumer experience, we pay attention to consumers’ pur-chases and usage experience, and actively track all stages of the transaction chain.We forecast issues that consumers may encounter and follow up on them, and contin-ue to optimize the consumption experience at all stages.
7172
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
All the brands under Proya have been recognized for their customer service capabili-ties, and have received numerous accolades.
Recognition and honors related to consumer servicesProya
TIMAGE
Hapsode
Proya’s customer service team was honored as a “Jinwangwang” team (gold team) twice and“Yinwangwang” team (silver team) eight times.The customer experience score for Proya’s store on TikTok remained at 97 or above.Proya’s JD store obtained the Excellent Consulting Service Award for the Through Train service.The TIMAGE store on Tmall was granted the title “6.18 Gold Customer Service Team,” the “Five-Star Store Experience Award,” and the “Silver Bee Award for Functional Services of Stores.”TIMAGE was awarded the Red Rabbit “Star Customer Service” prize (highest satisfaction andconversion rates).The Tmall store has been honored as a “Jinwangwang” customer service team for eightconsecutive months.The brand maintained a 100% rating for services on the TikTok store.Consumer privacy protection
Proya values information security and consumer privacy protection. We strictly abideby the Personal Information Protection Law of the People’s Republic of China, theData Security Law of the People’s Republic of China, and other laws and regulations.We have developed the E-commerce Data Security Management System, the NetworkSecurity Management Measures, the Information System Development ManagementMeasures, the Data Security Management Rules, the Data Classi?cation and GradingSecurity Management System, the Full-Lifecycle Data Security Management System,and other management systems. In terms of data security and research and develop-ment, we require all employees to strictly implement security systems to ensure com-pliance with data-secure production requirements. We follow up on the latest securitypolicies and related regulations in real time.We strictly control the access to and transmission of consumer information, desensi-tize sensitive information, and restrict data duplication and the frequency of access toconsumer information. We also set permissions for the export of sensitive informationso that operators cannot obtain user information. We review the existing data, tightenthe access rights of the data domain, and strengthen access control of the networkenvironment. In terms of e-commerce platform management, we strictly comply withthe requirements of each platform for consumer information protection, encryptingand desensitizing consumer information during transmission to ensure informationsecurity.Meanwhile, we enhance consumers’ awareness of privacy protection through internalmeetings and expert-led training sessions. Additionally, we have organized three in-ternal meetings to discuss and promote privacy protection. We also invite external ex-perts to hold exchange sessions, aiming to spread the concept of information securityand protection.
We believe that the most basic customer service that an enterprise can perform is toprovide consumers with genuine, accurate, and complete product and marketing infor-mation. In strict compliance with the Law of the People’s Republic of China on Protec-tion of Consumer Rights and Interests, we have established a sophisticated manage-ment mechanism to ensure the authenticity and accuracy of product marketing content.
Understanding the safety and functionality of cosmetics is an important line of de-fense for consumers to ensure their own safety. Through transparent ingredient dis-closure and education on chemical ingredients in various forms, we help consumersbetter understand the ef?cacy of ingredients so they can make purchasing decisionsmore wisely.
Responsible marketing
We fully indicate product ingredients on labeling in accordance with the require-ments of laws and regulations.We upload a complete ingredient list of products on apps commonly used byconsumers, such as “Transparent Label” and “Practical Beauty,” on which weopenly and transparently disclose product ingredients.We publish a list of replaced chemical ingredients of concern on our of?cial web-site and regularly update the replacement list and progress. We also announcethe method to access product ingredient records.We clearly explain the ingredients used, the mechanism of action, and the sourcein the promotion of all products.
Guaranteed Accuracy of Product
Promotion
Training for Responsible MarketingWe have established the Product Technolo-gy Content Department, in which our R&Dprofessionals review product descriptionsto ensure the correctness and accuracy ofscienti?c and technical content in the pro-cess of product promotion.We have established the Product Copywrit-ing Review Procedures. Marketing copywrit-ing must be reviewed by departments suchas brand marketing, product development,research and development, and legal affairs.We conduct internal clinical trials andthird-party testing for the main ef?cacy ofproducts during the marketing process.
Prior to the launch of a new product, weorganize training in product informationaccuracy for brand marketing, operations,and customer service personnel, includingproduct texture science, product usagesuggestions, and more.Customer service personnel receive at leastthree sessions of training in product knowl-edge and take post-training examinationsto ensure that consumers are provided withconsistent product information in line withour standard product introduction.During the Reporting Period, we conduct-ed three training sessions on brand valuesto standardize marketing behavior. Thecoverage rate of responsible marketingtraining for product marketers and cus-tomer service personnel reached 100%.
Administrative measures for sociallyresponsible marketing >
Administrative measures for chemicalsafety and ingredient transparency >Ingredientdisclosure
7374
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
We develop complete quality control standards covering chemical ingredients, appearance,and consumers’ use experiences to ensure that suppliers adhere to the standards during pro-duction.Before the ?rst batch of products are produced, we conduct on-site guidance to clarify stan-dards for production management personnel and address issues related to the application ofquality standards in actual production.When products are released by OEM/ODM suppliers, we require them to conduct qualityinspections and provide the test results.We conduct quality inspections to ensure that outsourced products meet our standards.We conduct random inspections based on quality standards and perform on-site reviews inresponse to market feedback.
Quality control measures foroutsourcing >
Standard formulation
On-site guidance
Quality testing
Random inspection
Supply Chain Responsibility
Supplier managementprocess >
Based on new requirements arising from business operations, the ProcurementDe-partment makes a request for developing new suppliers as existing resources areunable to meet the demand.The business pro?les of new suppliers are reviewed to select the most appropriatepotential supplier, and then on-site audits are arranged. Suppliers are scored andthen admitted according to the evaluation standards for new suppliers.
Supplier admission
We evaluate the performance of suppliers semi-annually, which is initiated by theProcurement Department and carried out in collaboration with the Quality Manage-ment Department and the Price Review Department. During the process,suppliersare scored and graded into A, B,C, and D both on the SRM platform and through of-?ine evaluation. The evaluation criteria mainly include product quality,delivery, price,value-added services, and ESG management.
Supplier evaluation
Based on the results of supplier performance evaluation, D-level suppliers are con-sidered unquali?ed and will have their cooperation terminated after the ProcurementDepartment ?lls out the Supplier Removal and Change Form,which must undergomultiple levels of approval by superior organizations.
Unqualified suppliers
Performance highlights
Supplier management
%
40.4
%*
15.93
%*
Pass rate of ESG complianceassessment for suppliers
Proportion of RSPO-certifiedpalm oil derivatives procured(by type)
Proportion of RSPO-cer-ti?ed palm oil derivativesprocured (by weight)
*Calculation formula for the proportion: RSPO-certified palm oil derivatives/all palm oil derivatives
Most of our suppliers are material suppliers, OEMs, or ODMs. Stable relationshipswith suppliers are crucial to the quality of our products and services, as well as our sta-ble operations. Proya complies with the Civil Code of the People’s Republic of China,the Bidding Law of the People’s Republic of China, and other laws and regulations. Wealso conduct effective end-to-end management of suppliers to prevent and controlsupply chain risks.We have established multiple management documents such as the Supplier Manage-ment System and the New Supplier Development Management System for ProductionMaterials, which place normative regulations on the entire process from supplier ad-mission to evaluation, assessment, and review. In 2023, we formulated the CosmeticsProcurement Management System to further standardize the procurement process,supplier admission, review procedure, and standards for cosmetic products, ensuringthat cosmetic products are procured in compliance with company standards.
In terms of supplier quality management, we conduct regular on-site audits ofsuppliers and provide specialized quality training for key suppliers. In 2023, wecompleted annual audits for 77 suppliers. Meanwhile, various departments of thecompany worked together to organize targeted quality training and review meetingsfor 11 suppliers, aiming to enhance their quality management and ensure theeffectiveness and safety of raw materials.In addition, we have established the Outsourcing Management System for OEM/ODM suppliers. This document strengthens quality control in the outsourcingprocess through standard formulation, on-site guidance, quality testing, and randominspections.
In terms of supplier ESG management, we consider environmental, labor, and ethicalfactors in supplier admission and review. The assessment indicators involved in thisprocess include compliant employment, employee training, trustworthy operation,and environmental management. In 2023, Proya evaluated 264 suppliers for their ESGperformance with a pass rate of 100%, and conducted ESG compliance assessmentsfor all of our key partners.To keep the supply chain stable, during the Reporting Period, we continued to facil-itate upgrades in automation, digitization, and intelligentization, enabling smoothdata and information ?ows between the production and demand sides and improvingthe accuracy and agility of our response to market needs. Additionally, we have built awell-covered and stable supply chain guarantee system that covers value assessment,strategic planning, technology application, and business operations. Measures arealso taken to effectively improve supply chain resilience, including scienti?c forecast-ing, early warning, and strict supplier management.
7576
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Our sustainable procurementmeasures >
Measures and achievements ofsustainable palm oil procurement >
Environment
Society
Governance
We preferentially purchase eco-friendly raw materials, including sustainable forest certi?ed pa-per, palm oil, eco-friendly inks, coatings and glues.For raw materials originating from Africa, we give preference to producers who have signed fairtrade agreements.Natural products are the core ingredients of Proya’s products. For punarnava root extract, taragum, and cupuacu butter, we give preference to suppliers who comply with the Nagoya Protocol.We work with suppliers to improve the production process and reduce the environmental impactof the manufacturing process.All suppliers are required to sign the Business Code Compliance Commitment and commit to es-tablishing a complete environmental management system to improve resource ef?ciency, reduceindustrial waste water, waste gases, and residues, as well as lower greenhouse gas emissions.
In the Business Code Compliance Commitment, we require suppliers to commit to adhering tocompliant employment practices, not employing child labor, not engaging in forced labor, andfollowing fair and non-discriminatory employment principles.
Suppliers must abide by the principles of integrity and transparency, and reject any form ofcommercial bribery.
Prioritize the use of green and certified raw materials
Work with producers and suppliers to reduce environmental impact
Requiring suppliers to establish an environmental management system
Sustainable procurement
Proya is fully aware that our procurement activities have a signi?cant impact on theenvironment and society. We need to take a holistic approach to examining our re-sponsibilities across the entire value chain system. We consider the environmentaland social impact of the raw materials we use, and are committed to their responsibleprocurement. Also, we actively guide and support our partners in implementing ESGmanagement, helping them to reduce their own environmental and social footprint.
In terms of forest products, the cartons of our hero products and new products alladopt FSC-certi?ed paper. The retail warehouse of skincare products adopts FSC-cer-ti?ed zipper cartons. Proya Advanced Firming Nourishing Concentrating Mask 2.0 andProya Original Repair Concentrating Mask 2.0 adopt FSC-certi?ed lyocell ?ber fabricto support sustainable forest development.We also actively introduce natural and organic raw materials to provide consumerswith more diverse product choices and meet the growing demand for sustainable con-sumption. During the Reporting Period, Proya Inaugurating Intensive Firming Cream,Proya Inaugurating Anti-Wrinkle Essence, and Proya Inaugurating Anti-Wrinkle EyeCream adopted rambutan peel extracts that are certi?ed by COSMOS and ISO 16128.Proya Advanced Firming Nourishing Concentrating Mask 2.0 adopted vegan-certi?edcotton fabric.Moreover, we support suppliers in their ESG management to drive sustainable trans-formation across the entire value chain. In 2023, we provided ESG training for packag-ing and raw material suppliers as well as OEMs and ODMs at the supplier seminar toenhance their awareness of ESG management. Drawing on the experience of Proya, 9suppliers started to use recyclable cartons during the Reporting Period to reduce theuse of disposable cardboard cartons.
Palm oil is an important raw material in the cosmetics industry. We do not directly usepalm oil in the manufacturing of our products, but palm oil derivatives are included inthe raw materials we use. We are actively engaged in the management of palm oil de-rivatives by prioritizing the procurement of palm oil derivatives certi?ed by the Round-table on Sustainable Palm Oil (RSPO). This effort enhances the sustainability of ourproducts and reduces their environmental impact. In 2023, we of?cially joined RSPOand are now working to gradually replace palm oil in raw materials with RSPO-cer-ti?ed products.
WorkAchievementIdenti?cationand reviewTracking
Adjustment
Identi?ed products involving palm oil or palmoil derivativesReviewed our use of RSPO-certi?ed palm oil
Proportion of RS-PO-certi?ed palm oilderivatives procured(by type): 40.40%Proportion of RS-PO-certi?ed palm oilderivatives procured(by weight): 15.93%
?*Calculation formula for the proportion:
RSPO-certi?ed palm oil derivatives/all palmoil derivatives
Tracked the source of palm oil, required sup-pliers to provide information on the origin ofpalm oil as well as RSPO certi?cation creden-tials, and added relevant information in theinternal system to enhance palm oil recordmanagementGradually replaced palm oil with RSPO-certi-?ed products
7778
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Employee Responsibilities
In accordance with the Labor Law of the People’s Republic of China and the LaborContract Law of the People’s Republic of China, we have established and implement-ed the Employee Recruitment and Hiring Management System, the CompensationManagement System and other regulatory documents to protect employees from anyform of discrimination during the recruitment and management processes. During theReporting Period, we did not encounter any incident or lawsuit related to recruitmentand dismissal, working hours and vacations, promotion and equal opportunities, an-ti-discrimination and diversity, or labor standards.
An equal relationship in dialogs is bene?cial for establishing an ef?cient work mech-anism and can encourage more employees to participate in the development andoperation of the company, thus enhancing their sense of belonging. We continuouslyimprove our communication approach with employees, listen to their opinions andsuggestions, and perfect corporate management to create an equal and open work-place. Furthermore, we have established a labor union by signing a collective agree-ment, and actively communicate with employees.
Attaching great importance to the bene?ts of employees, we have formulated and im-plemented the Bene?t Management Measures to provide employees with a rich andcomplete bene?t package. On the basis of statutory bene?ts, we also provide supple-mentary and special bene?ts for employees. According to the document, we providespecial bene?ts for employees working in factories, such as employee dormitories orhousing subsidies, free meals, as well as rewards for full attendance and long service.In 2023, we provided free temporary accommodation for employees who had to workovertime and live far from the of?ce, aiming to reduce their commuting time and en-sure they have enough time to rest.
Employee rights and benefits
Compliant employment
Employee communication
Employee benefitsPolicies of employment andfundamental rights of employees >
Employee communication channels >
Relevant DocumentRight Protection MeasurePrinciples: fairness, equity, transparencyElimination of child labor: We ensure that jobapplicants meet the legally required minimumage for employment during the recruitmentprocess.Prohibition of forced labor: We promote ?exibleworking hours, timely attendance recording,regular monitoring of work intensity, and work-life balance.
Social insurance
Elderly care benefits
Lunch allowanceCash gifts for weddings and funerals, holiday, condolence payments, birthday gifts, etc.
Housing provident fund
Special health benefitsTemporary accommodation
High temperature fee
Statutory holidays, annual leave, andother statutory benefits
Special benefits forfactory employees
Physical exams andcommercial insurance
Annual travel, team building benefits,additional leave for employees
We carry out dismissal procedures in strict ac-cordance with labor regulations.We implement a standard working hours sys-tem, with 40 hours per week. Overtime hourscan be compensated with time off upon re-quest.We provide paid annual leave, marriage leave,bereavement leave, and other statutory holi-days.We provide parental leave, nursing leave, andother types of leave according to local regula-tions.
Employeerepresentativeassembly
DingTalk, Fei-shu, and of?ceautomationplatforms
Face-to-facecommunicationbetween man-agement andemployees
Employee satis-faction surveysand touchpointsurveys
Smooth employ-ee complaintchannels
We have established a fair and competitivecompensation system based on performance-driven principles.We provide subsidies or allowances fortransportation, travel, and other expenses thatmay vary depending on the job or positionrequirements.
Employee Recruitment
and Hiring Management
System
Employee Departure
Management Measures
Administrative Measures
for Requesting Leave
Compensation Manage-
ment System
Recruitment
DismissalWorkinghours andvacations
Compensationand benefits
List of company benefits >
Statutory benefits
Special benefits
Additional benefits
Performance highlights
23.53
%
90.51
%
Proportion of women in senior managementCoverage of training for employees
7980
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
As we continue to grow and employees have increasing needs, we are constantly up-grading our bene?t system to reward our employees for their hard work. To enhancethe care for employees’ families, in 2023, we organized the “Paintings of Kids” artexhibition for employees’ children, and held an open day when employees’ childrenwere allowed to visit our facilities and experience hands-on production of makeupproducts. Furthermore, the labor union regularly organizes holiday events and otheractivities to enhance the sense of happiness and belonging among the employeesworking at Proya.
We advocate for a balance between work and life. To keep this advocation, we imple-ment a ?exible working hours system to give employees more freedom at work. Thecompany is also equipped with leisure facilities such as a relaxation lounge and a ?t-ness area. We encourage employees to form clubs and provide a fund of CNY150,000per year on average for clubs. In addition, we hold cultural and sports activities regu-larly to enrich the vocational life of employees, enhance their happiness, and achievea better work-life balance.
Employee care
Employee care initiatives >
MeasuresActions
We set up a private, clean, and comfortable “mommy hut” for workingmoms, which is equipped with sofas, chairs, a refrigerator, wet wipes,breastfeeding promotion guides, and posters, to provide a “home awayfrom home” in the workplace.On International Women’s Day, we presented our female employees with“3?8” pink gift bags and launched the initiative “Gender Equality in theWorkplace.”
We invited a professional instructor to conduct a meditation and psycho-logical stress relief lecture titled “Farewell to Workplace Anxiety, Startwith Loving Yourself” to help employees accept their emotions, relievenegative emotions, and bid farewell to workplace anxiety.We curate holiday celebrations to share happiness with employees, deliv-ering home-like warmth to them. The events we organize include present-ing couplets on Spring Festival and roses on Valentine’s Day.We organized four company-wide multi-brand internal purchase sessionsto provide employees with cost-effective products. The sales amount ex-ceeded CNY2.4 million.
The Logistics Departments of factories built “employee hubs” for employ-ees, complete with furniture and facilities, which serve as comfortable restareas in the workplace.
Care forWomen
PsychologicalCare
HolidayEventsInternalPurchaseBenefits
EmployeeHub
Cultural and sports activities foremployees (partial) >DescriptionEvents
We organized a fun sports event including mixed tug-of-war,3-minute jump rope, mixed 100-meter relay, charades, and men’s/women’s 4×400 meter relays. The event relieved work tension andimproved employees’ physical ?tness.We organized the 20th Anniversary Concert and streamed it liveon the internet to share our accomplishments with employees andpay tribute to those who have helped us grow better.We organized an outdoor night hiking event for employees.We invited a professional band to perform live at the Starlight Mu-sic Festival titled “Singing the Beauty at Sunset.”We organized a travel season photography contest, encouragingemployees to capture beautiful moments in life with cameras.We organized a badminton competition, including single matches,two-player fun matches, and six-player group matches, aiming toenrich employee life and intensify team cohesion.
Youth forVitality, Sportsfor the FutureSound of ProyaCharity forBeautyPhotographyCompetition“Power of Youth”Badminton Com-petition
8182
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Regarding work safety, we are committed to creating a safe and healthy working en-vironment and ensuring the physical and mental health of employees to facilitate safeproduction. We strictly comply with the Labor Law of the People’s Republic of Chinaand the Work Safety Law of the People’s Republic of China, and establish work safetygoals. During the Reporting Period, we had no incidents of work-related casualtiesand no ?re incidents.
We highly value the occupational health of our employees and comply with theLaborLaw of the People’s Republic of China and the Law of the People’s Republic of Chinaon Prevention and Control of Occupational Diseases. We have established occupa-tional health management objectives, as well as formulated and strictly implementedthe Occupational Health Management System. Those documents allow us to identifyoccupational health risks in the production environment, and take targeted measuresto ensure the physical health of employees. During the Reporting Period, our skincarefactory passed the audit of ISO 45001:2018Occupational Health and Safety Manage-ment Systems, with zero occupational health cases occurring in the company.
We have established a sophisticated work safety management system that comprisesa line of regulatory documents, including the Production Safety Inspection and Poten-tial Accident Identi?cation and Elimination System, the Production Safety Educationand Training System, the Regular Safety Meeting System, and the Occupational HealthManagement System. In addition, regular safety training and ?re drills are carried outto ensure the safety of employees.
Occupational health and safetyWork safety
Occupational health
Management goals >
Avoid major casualties, fire or explosion incidents, and ensure that thenumber of incidents causing minor injuries stays below three per year.
Prevention is the key. We regularly study the dynamics of work safety, and promptly address anyissues arising in production, as well as make wise and effective use of work safety funds to im-prove working conditions and operating environments.We establish a robust safety organization network, improve the accountability system for worksafety positions, sign work safety responsibility agreements at each level, fully play our part inwork safety management, and eliminate unauthorized commands and operations.
We improve safety education pro?les for employees. All new workers must receive three-tiersafety education and training, pass the exam, and sign the Safety Liability Statement beforetaking their posts.We organize the “National Work Safety Month” campaign every year. By organizing safetyactivities, we enhance employees’ safety awareness, improve their safety skills, and promote aculture of work safety.
We strictly review and approve hazardous work to ensure that all necessary procedures are inplace for it. We ensure that a detailed construction plan, written instructions, and safety pro-tection facilities are in place before hazardous work, and regular inspections are carried out toidentify and promptly correct any potential hazards.We manage work safety records in a uni?ed manner, conduct regularsupervision and inspec-tions, and identify potential safety hazards in production.We have established the Emergency Response Plan for Production Safety Accidents, whichspeci?es a complete safety incident emergency response system that covers organization, re-sponse, post-incident disposal, specialized emergency response, and on-site handling.
Work safety management measures >
Improve the management system
Enhance safety education
Tighten process management
The Huzhou skincare factory added a ?re monitor and a sprinkler system, and replaced?re extinguishers in the warehouse to ensure the safety of buildings and employees.
We entrusted a professional team to diagnose the safety design of the factory and developan improvement plan, with the aim of continuously enhancing the safety of workplace forour employees.
All employees of the Huzhou factory attended the Zhejiang Provincial Work Safety MassTraining for Employees, and were required to complete both online and of?ine exams.We organized a fire emergency drill to identify unfamiliarity with emergency responseplans and the use of protective equipment. Based on the results, we provided additionaltraining to enhance employees’ safety awareness and emergency response capabilities.This training covered self-rescue and disaster relief skills for various types of accidentsand disasters.
Progress of work safety >
Technological upgrade projects in workshops
Safety design diagnosis
Massive safety training for employees
Fire safety emergency drill
Certification of the occupationalhealth and safety managementsystem >
Certified EntityCertificationExpiration DateISO 45001:2018 OccupationalHealth and SafetyManagement Systems
November 2021 -February 2025Skincare factory
Health management goals >
Zero occupational diseases; conduct regular occupational hazardtesting and occupational health examinations
8384
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Our occupational hazards mainly include dust and VOC gases. We provide compre-hensive protection for employees against occupational hazards in terms of environ-mental and equipment safety protection, as well as personal safety protection.
In addition, our labor union provides medical assistance insurance and organizes fre-quent health training activities to ensure the health of employees.
We not only cared about the physical health of employees, but also their mentalhealth. We created a relaxing and enjoyable work environment for employees, andprovided them with frequent psychological support. During the Reporting Period,we engaged a professional psychology instructor to conduct mindfulness meditationtraining, helping employees relieve workplace anxiety and learn to embrace theiremotions. Meanwhile, we encourage employees to call the Echo Project helpline toreceive telephone counseling that can help them relieve their psychological stress.
Measures for the prevention ofoccupational hazards >
Work progress of Proya’s laborunion >ResultsProjectsMedical assistanceinsuranceOccupationalhealth trainingMedical servicein the company
During the Reporting Period, the labor union provided 2,061 employ-ees with on-the-job medical assistance bene?ts.During the Reporting Period, we held 4 health seminars, with 196employees participating in total. The content covered ?rst aidtraining, CPR treatment, shoulder and neck therapy, and otherrelated topics.We invited doctors to provide on-site consultations in the company,facilitating employees to seek medical attention.
Personal safety protectionEnvironmental and equipmentsafety protectionWe prioritize the use of new technologies,processes, and materials beneficial inpreventing occupational diseases andprotecting workers’ health.We use a dust and VOC collection systemto remove dust and VOC gases from ourworkshops.We set up on-site warning signs and bulle-tin boards and distribute protective gearto our employees.We regularly repair and maintain occu-pational health protective equipment,emergency rescue facilities, and otheroccupational health protective items forpersonal use.
We provide workers with protective equip-ment against occupational diseases for theirpersonal use, and regularly conduct trainingon the proper use of personal protectiveequipment to ensure that employees canuse them correctly.We carry out occupational health checksfor workers who may be exposed to oc-cupational hazards before, during, andafter their employment.Every year, we provide free health check-ups for all employees. Additionally, weorganize targeted health seminars to ad-dress prevalent suboptimal health issuesamong employees.
We are fully aware that Proya’s high-quality development depends on the growthof talent. Seeing the capability enhancement of employees as a critical driver of ourbusiness development, we continuously empower employees to grow. Proya placesgreat importance on nurturing talent in schools. Therefore, we have formulated theManagement Trainee Development Program. Each year, we visit universities to conductcampus recruitment activities, bringing fresh blood into the company. We also inviteindustry experts specializing in raw material development and research, productdesign, and many other aspects to join us. The purpose is to create a pool of talent forenhancing our competitiveness.In terms of employee training, we integrate internal and external training resources andprovide personalized vocational training sessions for employees at different stages ofdevelopment and with different skill enhancement requirements. In this way, we cancreate a fully covered training and development system for employees. Furthermore,we strictly comply with the Regulations on the Management of Professional Skillsand have established the Management Procedures for the Grading and Certificationof Professional Skills. This allows us to assess employees’ professional skills in astandardized manner while continuously optimizing our training system.
Development ofhuman capital
Employee training
Training system >
Trainee: New employeesTraining content: Proya’s history and culture, rules and regulations, and essential knowledge foremployeesTrainee: Key personnel in the business department and management traineesTraining content: Brand marketing planning, research and development techniquesTrainee: Mid-level managersTraining content: Business mindset, management skills, leadership development trainingTrainee: All employeesTraining content: Business and management skill enhancement trainingTrainee: Executive managersTraining content: Horizon expansion and strategic thinking improvement
Internal training
Onboarding Training
Professional Training
Promotion Training
Routine Training
Executive Study Tour
Trainee: All employees who have passed the examTraining content: Alibaba’s business training course to provide employees with comprehensivebusiness knowledge educationExternal training
8586
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
In addition, we also encourage employees to further their education. In 2023, wesponsored six employees to participate in the education improvement subsidy pro-gram organized by the Hangzhou Municipal Federation of Trade Unions, aiming topromote their educational level.During the Reporting Period, we conducted 53,607.75 hours of training in total, cover-ing 90.51% of employees. The average training duration per person was 18.04 hours.
Furthermore, to ensure the implementation of our 6*N strategy, we have establishedthe Proya Brand Academy, dedicated to nurturing more marketing talents for Proya.During the Reporting Period, we developed the Proya Brand Academy Operation andManagement Method and continuously enhanced training in leadership, expertise,and general skills. Also, the focus was put on improving employees’ cross-departmen-tal communication and team management capabilities. We carried out a satisfactionsurvey for the training of the Proya Brand Academy, and optimized the practicality,format, and course design of the training based on the results. In 2023, the satisfac-tion rate for the training held at the Proya Brand Academy increased to 95% (comparedto 88% in 2022).
Courses available at the ProyaBrand Academy >
DescriptionCourseTraining
Regularly conduct profes-sional training courses toenhance the professionalawareness and skills of em-ployees.Re?ne best practices fromwork experiences to enhancethe professional skills ofmarketing talents.
Enhance the managerialawareness and skills ofemerging managers, broad-en their horizons, and intro-duce new work philosophiesand practical experiences.
Structured Interview TechniquesCross-Departmental Communica-tionExpressions in Work ReportsDepartment-Speci?c Communi-cation and ExchangeProfessional Quality and PracticalWorkplace ToolsCore Management Theory forNew Product LaunchesCore Concepts and Principles ofMarketingConsumer Behavior and ProductAnalysisPrinciples and Tools of ConceptDevelopmentManagement Mindset Transfor-mation and Capability ModelSituational LeadershipTeam MotivationCollaborative In?uence
General skilltraining
Productdevelopmentempowermenttraining camp
Manager 2.0micro-consultingpractical trainingcamp
We select talented individuals based on their virtue, ability, and performance, ratherthan purely on quali?cations and ranks. According to the requirements of the compa-ny’s organizational structure, business opportunities, and the selection and examina-tion results of the talent pool, employees with outstanding abilities and contributionsare promoted exceptionally. We also have a mechanism for individual and team recog-nition to honor outstanding employees and teams.
In terms of employee promotion, we have formulated the Performance ManagementMeasures, the Personnel Management Measures, and the Internal Competition Pol-icies. These regulations adopt unified criteria for performance management andassessment to ensure accessible performance evaluation standards, fair procedures,as well as transparent appointment and promotion of managers at all levels. We havepromotion channels for management-oriented and expertise-oriented employees ac-cording to the characteristics of the position, and provide employees with clear careerdevelopment paths.
Additionally, we have established a sophisticated talent review and job rotation mech-anism to expand employees’ knowledge areas and help them ?nd their direction ofcareer development. Furthermore, we have implemented a manager feedback pro-gram to assess the leadership of key leaders in business departments with the aim ofenhancing their leadership and cohesion.
Employee performanceevaluation and promotion
Mechanism for selecting outstandingindividuals and teams >
Conduct the talent review every July and December to review the needs for job ro-tation.Talent review
Develop the job rotation plan based on the needs of the employees and relevant depart-ments.Submit the job rotation plan to the General Manager’s Of?ce for approval.Plan developmentUnderstand employees’ perception of their new positions and performance expec-tations, and reach a consensus with them.Employee communication
Prepare the handover checklist for the original position once the plan is approved.Assign the direct supervisor of the new position as the counselor.Handover coaching
Set a three-month grace period, during which the original performance level andsalary remain unchanged.Conduct performance evaluation after the grace period, and determine the rankand salary based on the actual conditions.Performance evaluation
YearFrequency of
selectionAwardSelectionmechanismSelectionprocess
3 special prizes, 6 team prizes, and 11 individual prizesBased on contribution, business development scenarios, and capabilityNomination by department > Review by the project team > Approvalby the General Manager’s Office > Holding of the award ceremony
8788
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Community Responsibility
We uphold the corporate mission of “enabling a beautiful and better life” and ad-vocate for the societal value of “beauty.” We focus on four key social topics: genderequality, mental health, youth and growth, and love and caring. Leveraging our brandin?uence and expertise, we issue initiatives, take action, and join hands with partnersto build a better life. In 2023, the social welfare activities promoted by Proya directlybene?ted 233,000 people and indirectly bene?ted 247 million people.
Social welfare
Social welfare activities in 2023
>
Social welfare activities in 2023
>
Project NameProject DescriptionProject Data“It’s Gender, NotBorder”special campaignfor InternationalWomen’s Day
Start date: March 2023Project description: Proya distributed the gendereducation picture bookWe Can Do It, aimed atexpressing the idea that we can all break freefrom gender biases and stereotypes, and becomethe people we want to be.
Start date: March 2023Project description: Proya partnered with Beijing
Qianqian Law Firm to launch the Proya PublicWelfare Service mini-program, which providespractical legal assistance to workers facing gen-der bias in the workplace.Start date: March 2023Project description: Following the principle of
telling genuine “her stories,” Proya found a storyabout a Tibetan girl name PUBU Zhima whobecame the captain of a freshman soccer teamat Nankai University. Then, Proya produced theshort video “She is the Captain” to show thecourage and resilience of the young girl in theface of prejudice.
A total of 110,000 copies of the picturebookWe Can Do Itwere printed anddistributed.The Proya Public Welfare Servicemini-program provided legal advice to966 people, including pro bono legalconsultation services to 87 people.The short video “She is the Captain”received more than 6.77 million viewcounts and over 680,000 discussionsacross all platforms.
Gender equality
Project NameKey socail topicsProject DescriptionProject Data
Echo Projectyouth mentalhealth campaign
Fire?y ProjectAnti-School-Bul-lying Campaign
Start date: October 2023Project description: Proya produced the public
welfare ?lmSay ____ to Your Emotions RightNow, calling on everyone to embrace emotionsand pay attention to mental health.Start date: October 2023Project description: Proya partnered with Dejavuand 9 publishing houses to design a curated listof 11 selected books, as well as produce anddistribute Echo Bookshelf blind boxes, hopingreaders can learn to embrace emotions throughreading.
Start date: October 2023Project description: Proya collaborated withTencent Music to launch the “Let Emotions Talk”public campus concert. This spiritually curativeevent included 1 public welfare song, 1 publiccampus concert, 30 campus pop-ups, and 4 freelectures.Start date: October 2022Project description: Proya maintains the op-eration of the public welfare initiatives jointlylaunched with the China Youth DevelopmentFoundation, which included 1 teacher training, 1parent-child game, and 1 campus lecture.Start date: October 2022Project description: Proya maintains the long-
term public welfare hotline built in collaborationwith the Beijing New Sunshine Charity Founda-tion, providing a safe place for those who seekan inclusive and secure channel to speak.
Start date: September 2023Project description: Proya collaborated with the
Beijing New Sunshine Charity Foundation to setup the Glimmering Projectanti-school-bullyinghelpline. Coupled with distributing theIt’s NotYour Fault: A Healing Guide for the Aftermathof School Bullyingand producing theAftermathof School Bullyingshort ?lm, this initiative aimsto promote everyone’s awareness of how schoolbullying would affect our children, appeal foraction against school bullying, and educate thepublic on preventive and responsive measures,so as to guarantee a healthy environment forchildren to grow.
The public welfare ?lmSay ____ to YourEmotions Right Nowreceived 52.49million view counts with over 210,000discussions raised across all platforms.A total of 10,000 Echo Bookshelf pouch-es were produced and distributed, with30,000 people attending the charitablecampus music project.A total of 100 teachers participated inthe teacher training workshop, and 400students and teachers attended thecampus lecture.The public welfare hotline received1,482 calls.
The anti-bullying helpline provided freepsychological counseling for 353 victimsof school bullying and their families,including pro bono legal consultationservices provided to 27 victims.The public welfare short ?lm receivedmore than 44.14 million view countsacross all platforms with over 62.11 mil-lion interactive discussions.A total of 15,000 copies ofIt’s Not YourFault: A Healing Guide for the Aftermathof School Bullyingwere printed anddistributed.
Mental health
Youth and growth
Performance highlights
233,000
(million)
Number of people directly benefited
Number of people indirectly benefited
The number of people directly benefited is the number of people directly benefiting from the projects in which they are involved.
The number of people indirectly benefited is the number of people influenced by Proya’s projects, such as the number of people influenced by online campaigns andrelated offline activities.
Key socail topics
8990
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Stupid Geniusspecial campaignfor Proya’s 20thanniversary
Dare to Love,Dare To Not Lovespecial campaignfor Chinese Val-entine’s Day
Mom is Not theOnly OneSpecial Cam-paign for Moth-er’s Day
Start date: November 2023Project description: By producing a micro ?lmtitled Stupid Genius, the project pays tributeto those hard-working and dedicated research-ers, volunteers, inheritors of intangible culturalheritage, and all individuals who hold unwaver-ing faith and make unsung contributions at theirposts.Start date: May 2023Project description: Proya collaborated with Ne-tEase Cloud Music to launch a special campaignshort ?lm for Chinese Valentine’s Day titledDare to Love, Dare To Not Love. As a trial of lovefollowing the lead of music, this event was heldtogether with NetEase Cloud Music and JINWenqi to present the love song “My DesiredHappiness.” We also invited ZHANG Ruonan toshoot the music video for the themed short ?lm.When it comes to the mysteries of love, we say“love is always there if you follow your heart anddare to love and to not love.”Start date: May 2023Project description: On Mother’s Day, Proya
continued to care about mothers and theirphysical and mental workload assumed for theirfamilies, appealed to everyone to recognizemothers’ hardships and dif?culties in traditionalhousework, and proposed the brand attitude“Moms can take care of the family, but everyfamily member can do the same.” By means ofthe TV commercialMom is Not the Only One,the creative peripheral apron for the whole fam-ily, creative posters, and the adapted children’ssong “Mom is Not the Only One,” we call onevery family member to not just see the meritsof mothers, but assume their responsibilities asfamily members.
The micro ?lm received more than 87million view counts and over 650,000discussions across all platforms.
The short video received more than
21.79 million view counts and over
460,000 discussions on all platforms.A total of 19,000 “Know Yourself inIntimate Relations” test cards weredistributed.
The short video received more than
22.208 million view counts and over
250,000 discussions on all platforms.
Youth and growth
Love and caring
Social welfare activities in 2023
>
Project NameProject DescriptionProject Data
In addition, in 2023, Proya worked with Ta Foundation and Naloong (a cartoon IP) tolaunch the “Stray Animals Winter Survival Program.” Together, we distributed 10,000copies ofPopular Science Handbook for Stray Animal Rescueand donated 5% of thesales revenue from the Co-Branded Stray Cat Nest Gift Boxes to local rescue centersin order to help more animals in need.
In 2023, we established the Proya Foundation with the mission of “enabling morepeople to live a better life.” The foundation is dedicated to promoting educationaldevelopment, facilitating social innovation, providing emergency relief assistance,and supporting employee volunteerism. During the Reporting Period, Proya donatedCNY6,402,300 to the foundation. At the same time, we leveraged the platform to car-ry out a series of employee volunteer activities.
Furthermore, we are actively engaged in rural revitalization work by implementing theOpinions of the CPC Central Committee and the State Council on ComprehensivelyPromoting Rural Revitalization and Accelerating Agricultural and Rural Modernizationissued by the CPC Central Committee and the State Council. By purchasing agricultur-al products, we support the rural revitalization efforts and economic development ofYunhe County. During the Reporting Period, we purchased agricultural productsworth CNY192,000 from Yunhe County.
Charitable events
On World Earth Day, we launched a campaign under the theme “Unleash the Power of YourActions for a Better Planet.” During the event, we advocated for environmental protection andupcycling and hosted eco-friendly ?lm screenings to encourage employees to participate inenvironmental charity and low-carbon activities.We initiated the “Hydromel Winter Warmth” program, in which 10 employees donated suppliesfor strays and participated in volunteer activities.
Key socail topics
9192
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Corporate Governance
We comply with the Company Law of the People’s Republic of China, the SecuritiesLaw of the People’s Republic of China, the Listing Rules of the Shanghai StockExchange, the Code of Corporate Governance of Listed Companies and other lawsand regulations. We have established our Articles of Association and other regulatorydocuments to continuously improve our corporate governance structure and compliantoperation.We strictly follow the provisions of our Articles of Association in convening and hold-ing shareholders’ meetings, treating all shareholders equally, and providing as muchconvenience as possible for shareholders to attend the meetings, allowing them tofully exercise their shareholder rights.To further enhance the compliance of our corporate governance, in 2023, we revisedthe External Investment and Operation Decision-Making System, the Working Pol-icies for Independent Directors, the Related Transaction Decision-Making Policies,the External Guarantee Decision-Making Management System, and the Raised FundsManagement System. We also newly issued the Rules of Procedures for the Meetingsof the Board of Directors of Proya Cosmetics Co., Ltd., the Entrusted Wealth Manage-ment System, the Accounting Firm Selection System, and other regulatory documents.All shareholders, directors, supervisors, and senior management personnel were dil-igent in carrying out their duties, exercised their rights and ful? lled their obligationsin accordance with the regulations, relevant rules, and procedures. The actual per-formance of our corporate governance complied with the regulatory requirementsfor listed companies issued by the China Securities Regulatory Commission and theShanghai Stock Exchange. We did not receive any documents from the regulatory au-thorities imposing any administrative or regulatory measures on us.
Corporate governancesystem
Composition of the Board ofDirectors and convening of thethree meetings >
Composition of the Board ofDirectors and convening of thethree meetings >
directors on the Board of Directors
independent non-executive directors
shareholders’ meetings
meetings of the Board of Supervisors
executive directors
supervisors (including 1 employeerepresentative supervisor)
meetings of the Board of Directors
meetings of special committees of theBoard of Directors
A total of approximately proposals and reports have been deliberated, read, reviewed orheard in the three meetings
Composition of the Board of Directors and theBoard of Supervisors
Convening of the Three Meetings
Corporate governance structure diagram
>
General Manager'sOffice
Shareholders'
Meeting
Board of Supervisors
Board of Director’s
Office
Securities and Investor
RelationsESG Management
Committee
Internal AuditDepartment
UZERO DivisionOverseas Project TeamNew Brand Project TeamAnya DivisionCORRECTORS ProjectDepartmentINSBAHA Project TeamHapsode Brand DivisionTIMAGE Brand DivisionOff & Relax BrandDivisionProya Brand Division
Research and Development Middle Platform?Brand Middle Platform?Supply Chain Middle Platform?Digitalization Middle PlatformStrategic Management Department?Human Resources Department?Finance Department?Investmentand M&A Department?Legal Department?Administration Department
Chairman's Office
Corporate Culture
Department
Board ofDirectorsChairman of
the Board
GeneralManager
Compensation andAssessment CommitteeNomination Committee
Audit Committee
Strategy Committee
Performance highlights
CNY1,017.756mn
Total tax paid
Social contribution per shareCash dividends per 10 shares
CNY7.38(tax included)CNY9.10(tax included)
Increased bycompared to 2022
54.18%
9394
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Composition of the remuneration of directors and senior executives in 2023 (unit: CNY)
>
We have established a well-developed compensation and incentive system for ourdirectors and senior executives. The remuneration for our directors and senior ex-ecutives consists of ?xed salary and variable compensation. The amount of variablecompensation is determined by their annual performance. Particularly, we includecorporate sustainability performance as an indicator of variable compensation, andlink the remuneration of directors and executives with the progress of sustainabilityperformance. This approach truly propels the achievement of our sustainable devel-opment goals.
Position
Base Pay
Fixed SalaryVariable CompensationPosition PayAnnual BonusAllowancesand OtherCompensation
SustainabilityPerformanceBonus
Total AnnualCompensation
EquityCompensationNameHOUJunchengFANGYuyouHOUYamengJINYanhuaWANGLi
Chairman of theBoard ofDirectorsDirector,GeneralManagerDirector,Deputy GeneralManagerDeputy GeneralManagerDeputy GeneralManger, BoardSecretary, andChief FinancialOf?cer
240,000240,000
86,000120,000120,000
240,000240,000
86,000120,000120,000
672,000672,000128,000264,000480,000
300,000300,000
70,000220,000250,000
1,863,873.331,842,485.00
456,261.801,832,090.001,555,658.73
3,315,873.3303,294,485.000
826,261.8002,556,090.0002,525,658.730
We ful?ll the obligation of information disclosure in strict compliance with theCompa-ny Law of the People’s Republic of China, the Securities Law of the People’s Republicof China, and other relevant laws and regulations to ensure that our information is dis-closed truthfully, accurately, completely, and timely, and that all investors have fair ac-cess to our information. During the Reporting Period, we did not violate any regulationson information disclosure or investor rights, or face any penalties arising therefrom.We review the changes in relevant laws and regulations regularly and update ourmanagement documents such as theInformation Disclosure Management Policies ofProya Cosmetics Co., Ltd. in strict accordance with regulatory requirements. Also, weactively ful?ll our information disclosure obligations to ensure information is disclosedaccurately. In addition, we organize directors, supervisors, and senior executives tostudy relevant laws and regulations, including the Company Law of the People’s Re-public of China,the Securities Law of the People’s Republic of China, and theListingRules of the Shanghai Stock Exchange, ensuring that their behavior complies withthe legal requirements for information disclosure. Meanwhile, we have establisheda well-covered information disclosure approval process. Information to be disclosedoutward must be reviewed and approved by the Board of Director’s Of?ce to ensurethe disclosure is compliant.We are committed to giving equal opportunity to investors. To further protect therights and interests of small- and medium-sized investors, we have formulated theInvestor Relations Management Policies of Proya Cosmetics Co., Ltd. In addition, weactively communicate and interact with investors through various channels such astelephone, email, the SSE E-Interactive platform, performance brie?ngs, investor sur-veys, and online forums, aiming to enhance investors’ understanding and trust in thecompany.
Investor relationsInformation disclosure andinvestor communication
Investment communicationchannels >
TelephoneEmailPerformance
briefing
Investor surveySSE E-Interactive
9596
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Social recognition for ourinformation disclosure and investorcommunication performances >
Awarding BodyAwardBest Practice Award for Directors of ListedCompanies in 2023China Tianma Award of Investor Relationsfor Listed CompaniesTop 100 Companies Listed on the MainBoard by Market ValueChina Sunshine Board Secretary Award forChinese Listed CompaniesAnnual Entrepreneurship Vanguard forChinese Listed CompaniesIR Team with the Best InstitutionalCoverage 2023Best Information Disclosure Award
China Association for PublicCompaniesThe Securities TimesThe Securities TimesThe Securities TimesThe Securities TimesComeinThe 7th IRSC Chinese Outstanding IR
In 2023, we actively communicated and interacted with investors through diverse per-formance brie?ngs and investor exchange events. In addition, we kept expanding ourcommunication channels with investors by operating investor relations accounts onprofessional ?nancial platforms such as Eastmoney, HiThink, and Snowball Finance.
While striving for rapid and steady growth in both scale and ?nancial bene?ts, we nev-er forget to provide reasonable returns to investors based on our pro?tability and theneeds for production, operation, and development. Therefore, we implement a pru-dent dividend distribution policy that guarantees stable and continuous dividends,and rewards shareholders frequently.Investor rights
Investor communication performance >
We issued periodicannouncements
We conductedinvestor surveys andcommunication activities bothonline and offline
Interim announcements
Receivedinstitutionalinvestors
1500+
We value our reputation, comply with commercial credit rules, and safeguard the le-gitimate rights and interests of creditors as bestowed by laws, regulations, and ourArticles of Association. Based on the comprehensive analysis and evaluation of thecompany’s and the industry’s operating conditions, on June 16, 2023, China LianheCredit Rating Co., Ltd. issued the 2023 Tracking Rating Report on the Public Issuanceof Convertible Corporate Bonds by Proya Cosmetics Co., Ltd. The main long-termcredit rating of the Company was “AA,” the credit rating of Proya convertible bondswas “AA,” and the rating outlook was “stable.”The “social contribution per share” re?ects the comprehensive value created by thecompany for society and stakeholders. Our social contribution per share over the pastthree years is as follows:
Cash dividends over the pastthree years >
Dividends per 10 shares (CNY) (tax included)Year
Year202120222023
2021
Social contribution per share(CNY)
?tax included?
7.247.187.38
20222023
8.6
8.7
9.1
The cash dividends for the year 2023 include a proposed dividend of CNY9.10 (including taxes) per 10 sharesfor the annual distribution in 2023, a cash dividend of CNY3.80 (including taxes) per 10 shares for the interimdistribution in the first half of 2023, and the amount for share repurchases through centralized bidding in 2023.The total amount accounts for 45.98% of the net profit attributable to the shareholders of the listed companyin the consolidated financial statements for the year 2023.
Social contribution per share = (Net profit + Tax revenue generated for the country in the year + Wages paidto employees + Interest on loans paid to creditors such as banks + External donations and value created forother stakeholders ? Other social costs resulting from environmental pollution)/Total number of shares.
9798
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
In order to establish a risk management mechanism that facilitates the implementa-tion of strategies and promotes integrity, and to ensure the effective operation of thissystem, we have formulated the Internal Audit Management Policies,the Internal Con-trol Application Guidelines, and other regulatory documents. We also set up a mech-anism in each subsidiary and business unit to optimize the internal control systemand effectively manage and respond to internal and external risks. Those measuresensure that we can operate with low risks and develop rapidly and healthily. Duringthe Reporting Period, we revised the Internal Audit Management Policies to specifythe audit coverage and re? ne the audit procedure, thereby continuously raising thestandards of audit.Under the guidance of the Internal Control Application Guidelinesand theInternalAudit Management Policies, we have established project-speci? c systems and proce-dures for each business unit and functional department, so as to respond to marketdemands rapidly. We pay speci? c attention to the timely identi? cation and assessmentof ? ve major risk categories, including risks related to operational decision-making,violation of laws and regulations, ? nancial report misrepresentation, threats to assetsecurity, and fraudulent activities. We require the description of speci? c risk controlobjectives and measures for addressing these risks and enhancing our internal riskmanagement ef? ciency.
Our Internal Audit Department regularly conducts special audits and off-of? ce auditsto strengthen the legality, compliance, and authenticity of our business activities.Rigid inspections are in place for key areas such as contract performance and relatedtransactions. We also take measures to promptly address any violations or breaches,thereby promoting continuous improvement in our business processes and operation-al systems. In 2023, the Internal Audit Department carried out 14 special audits and 10other audits. They timely communicated and con? rmed with audited units about iden-ti? ed non-conforming items to ensure recti? cations were made. In addition, we wereawarded the Top 30 Best Internal Control Award for Zhejiang Public Companies In2023 granted by the School of Management, the Institute of Finance and Accounting,and the Academy of Global Zhejiang Entrepreneurship of Zhejiang University.
Internal control
special auditsother auditsBest Internal Control
Award for Zhejiang PublicCompanies In 2023
1410TOP30
99100
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Compliance Operation
Proya considers compliance operation as the cornerstone of our stable development.Therefore, we have established and are constantly improving a robust compliancemanagement system. We actively identify compliance risks in production and opera-tion processes, with a focus on anti-corruption, anti-bribery, environmental issues, andlabor rights.We have a multi-level supervision and reporting mechanism. For internal reports, wehave established the Employee Monitoring and Reporting Management Policies. Forexpert reports, we maintain diversified reporting channels such as the hotline andemail. We adopt a serious approach toward all reports, which are investigated underthe leadership of the Internal Audit Department.
Compliancemanagement system
Employee reporting and handlingprocess >
The Internal Audit Department has a reporting of?cer to record all reported cases.Register
The Internal Audit Department holds an internal discussion to verify the investigationconditions and severity of the case.Severe cases are reported to the deputy general manger, the general manager, thechairman, or the Audit Committee.Accept
The head of the Internal Audit Department forms the investigation team and ap-points the leader for investigation.All functional departments, business units, and subsidiaries assign personnel andparticipate in the investigation if so required.Form an investigation team
Report-handling personnel keep the relevant information of the whistleblower and the spe-ci?c content of the reported case strictly con?dential. The investigation proceeds withoutrevealing the identity of the whistleblower. Unless otherwise agreed by the whistleblower,the name, department, and contact information of the whistleblower are not disclosed un-der any circumstances.Report-handling personnel who violate con?dentiality regulations or improperly performtheir duties will be punished severely based on the severity of the situation and its conse-quences. Where it constitutes a crime, they will be handed over to judicial organs.No individual or organization is allowed to obstruct or suppress the whistleblower for anyreason, or take any form of retaliation against them. Those who retaliate against the whis-tleblower or their family members, once veri?ed, will be punished severely in accordancewith the relevant regulations of the Company. Where it constitutes a crime, they will behanded over to judicial organs in accordance with the law.Where a reported case is proven to be true, those who caused the violator to be duly pun-ished and losses of the company to be recovered or reduced will be commended or reward-ed according to company regulations as suggested by the Internal Audit Department. Inorder to protect the whistleblower, the reward approved by the CEO should be issued in acon?dential manner unless the whistleblower agrees otherwise.
Whistleblower protection measures >
Performance highlights
%
Coverage of anti-corruption trainingparticipated by directors
Number of corruption lawsuits filed againstthe issuer or its employees and alreadyconcluded
The investigation team leader starts the investigation work.The investigation should be completed within 30 days from the date of receivingthe report. It can be appropriately delayed for no more than 90 days if schedulingan audit is dif?cult or major obstacles exist.Investigate
The investigation team issues a report and submits it to the General Manger’s Of?ceso the case can be handled according to company regulations.Signi?cant cases need to be reported to the Audit Committee and the Board of Di-rectors.Cases violating national laws are handed over to judicial organs.
Report
101102
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
Legal compliance training andpromotion work >
AchievementsWork
Publishing thelegal journal
Proya LawThemedpromotionalactivities
Legal seminars
Peer-to-peerlegal exchangesand training
We produced and released 5 issues of the periodical, coveringthree main sections, which are “New Regulations,” “Hot TopicAnalysis,” and “Case Studies from the Legal Perspective.” The pur-pose is to comprehensively enhance employees’ awareness of riskprevention.We organized 2 offline interactive compliance publicity sessionsfor all employees as a part of the “4.26 Intellectual Property DayPublicity Event.”We organized the “Proya Transparency Promotion Week,” duringwhich we developed and released theCode of Conduct for Integri-ty and the Proya Integrity Initiative.
We produced and played the Transparency promotion video andheld a quiz with prizes for employees.We organized 2 special training seminars on compliant employ-ment, which covered prevention and handling of legal risks in em-ployment as well as employment management and risk prevention.We organized 8 intellectual property training sessions to enhanceour ability to protect our intellectual property and reduce the riskof infringing on others’ intellectual property.We conducted 3 e-commerce legal compliance training sessions to en-hance the compliance of e-commerce operations and management.We organized the legal team to attend multiple professional legaltraining sessions provided by third-party experts. The trainingcovered various topics such as advertising compliance trainingand judicial interpretation of Civil Code contracts.We organized and held the LCOUNCIL famous enterprise visit andexchange event titled “Proya’s Legal Empowerment and ValueCreation under the Optimization of Enterprise Functional Struc-ture” for the legal affairs teams of more than 30 companies in theFMCG industry. During the event, we shared with industry guestsour practical experiences in legal function management, e-com-merce compliance, and intellectual property compliance.
In order to enhance the efficiency of our compliance management system, duringthe Reporting Period, we transitioned from a “preventive” to a “strategic” legal ap-proach that is more professional, focused, and re?ned while standardizing legal affairmanagement across all brands. We also continuously improve the awareness of com-pliance operation among employees by publishing legal journals, organizing themedpromotional activities, conducting legal seminars, and facilitating peer-to-peer legalexchanges and training.
We place great emphasis on ethical standards in business operations and strictlycomply with relevant laws and regulations such as theAnti-Unfair Competition Law ofthe People’s Republic of China, theZhejiang Province Anti-Unfair Competition Reg-ulations, the Bidding Law of the People’s Republic of China, and theCriminal Law ofthe People’s Republic of China. Also, we have formulated the Management Measuresfor Anti-Commercial Bribery and Anti-Corruption, the Code of Conduct for Integrity,Proya’s 32 Articles, and other regulations to stem corruption from inside the company.We have a well-developed corporate governance and internal control managementframework. An Audit Committee is established under the Board of Directors to coor-dinate and plan anti-corruption and business ethics management. The Internal AuditDepartment is responsible for implementing anti-corruption and business ethicsinitiatives. During the Reporting Period, we did not encounter any incidents of cor-ruption, bribery, extortion, fraud, or money laundering, nor did we face any lawsuitsarising therefrom.We implementProya’s 32 Articlesand sign the Integrity and Self-Discipline Commit-ment with employees to enhance their awareness of “honesty, integrity, and trustwor-thiness.” Additionally, we sign the Integrity and Self-Discipline Agreement with direc-tors and senior executives, requiring them to abide by our business ethics standards.In terms of procurement from suppliers and brand partnerships, we require all suppli-ers of raw materials and packaging materials to sign theBusiness Code ComplianceCommitment, and brand promotion partners to sign theCooperation Agreement inIntegrity, while asking them to strictly adhere to anti-corruption and anti-bribery prin-ciples. We also clarify the de?nitions of commercial bribery and penalties for violationsin procurement contracts. Suppliers who violate our anti-corruption principles will beblacklisted. If a supplier’s actions constitute a crime, the supplier will be handed overto the competent state organ to investigate their criminal liabilities. We also requireprocurement personnel to sign theCommitment to the Code of Ethical Conduct forProcurement Personnel, so as to avoid the risk of bribery in the procurement manage-ment process.We have developed an audit plan for front-, middle-, and back-office operations,which covers the procurement of raw materials and packaging, media procurement,and inventory management. We also conduct anti-corruption and business ethics au-dits in an orderly manner according to the plan. We aims to conduct a business ethicsand anti-corruption audit throughout our entire business processes and all operation-al points every three years. The focus is on areas of high business ethics risks, such ascompliance audits for contract signing, ?nancial audits, and veri?cation of sales re-bates and discounts. The purpose is to ensure the effectiveness of our anti-corruptionand business ethics management. We assess the risk level based on the audit results,and then develop further corrective and re-audit plans as necessary to minimize risksof corruption and unethical business practices.
Anti-corruption andbusiness ethics
103104
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Management Practice Report
We strictly comply with thePatent Law of the People’s Republic of China, theCopy-right Law of the People’s Republic of China,and theTrademark Law of the People’sRepublic of China, and have developed a line of intellectual property managementregulations including the Intellectual Property Management Regulations. While pro-tecting our intellectual property, we also ensure that we do not infringe on the intel-lectual property rights of others.We have established an intellectual property management system to strengthen ourintellectual property protection efforts by means of intellectual property planning andmanagement, risk monitoring and control, process and system development, profes-sional talent development, and informatization tool availability. Meanwhile, we havenewly formulated theProya Compliance Guidelines for Audio and Video Productionand Release and the Proya Compliance Guidelines for Music Playback in Livestream-ing Rooms. Those documents are designed to regulate the compliant behavior inaudio and video production and release conducted by business units, and eliminatepotential risks of intellectual property infringement.
During the Reporting Period, we organized 8 intellectual property training sessions,including 5 sessions provided by external experts and 3 internal sessions on legalaffairs. The topics involved covered patent mining and layout, patent intelligence tosupport R&D innovation, and guidelines for the compliant use of images. The trainingenabled us to better manage our intellectual property and heightened our awarenessof respecting others’ intellectual property rights. Meanwhile, we applied for 47 newpatents and 95 registered trademarks, and were granted 41 patents of various kinds,62 newly registered trademarks, 5 copyright registrations, and 21 copyright deposits.Those efforts help us protect our innovative achievements and various intellectualproperty rights.We also combat illegal infringements through legal procedures. During the ReportingPeriod, our Proya brand took measures to combat online counterfeiting and unautho-rized use of trademarks in of?ine stores. This effort led to the ?ling of 48 cases, with 4cases already resolved through settlement. OR ?led 28 civil cases and Hapsode ?led236 cases. As a result, the legitimate rights and interests of the company and consum-ers were properly protected.
Protection ofintellectual propertyrights
When initiating a research and development project, we search for and review related intel-lectual property. Any project that may infringe on the intellectual property of others will besubjected to a one-vote veto.In the process of an R&D project, we protect the intellectual property rights generated in theR&D process in a timely manner.We actively carry out intellectual property registration, ?ling, application, registration and otherrights con?rmation work.
We have established an Intellectual Property Training and Publicity Fund to carry out intellectu-al property training and publicity annually.We have formulated the Proya Compliance Guidelines for Audio and Video Production andRelease, the Proya Compliance Guidelines for Music Playback in Livestreaming Rooms, and the
Proya Intellectual Property Compliance Guidelines in Exhibitionsto enhance our awareness ofintellectual property protection.
Before we initiate a new research and development project, proceed with new product devel-opment activities, and import or export new technologies and products, we must conduct intel-lectual property checks and searches to ensure we do not infringe on the intellectual propertyrights of others.We set uniform criteria regarding the use of software, fonts, and images across different busi-ness units to eliminate potential risks of intellectual property infringement.
Intellectual propertymanagement measures >
Anti-corruption and businessethics performance highlightsand social recognition >
Protection of our intellectual property rights
Intellectual property publicity
No infringement on the intellectual property rights of others
In 2023, we held multiple training sessions on anti-corruption and business ethics tobetter educate directors, senior executives, employees, and suppliers on knowledgerelated to anti-commercial bribery and anti-corruption, as well as to promote a cultureof integrity. Examples of training sessions include the “Compliance with Business Eth-ics and Strengthening Integrity and Self-discipline” education event for directors andkey management; training related to business ethics standards and anti-corruption forall employees (including outsourced personnel and part-time employees), such as theIntegrity Campaign Week; monthly compliance training for new employees and busi-ness ethics training for suppliers.In 2023, we held three training sessions on anti-corruption and business ethics, namelythe “Compliance with Business Ethics and Strengthening Integrity and Self-Discipline”education event for directors and key management, the “Business Ethics Standards andAnti-Corruption” training for all employees (including outsourced personnel and part-time employees), and business ethics training for suppliers. Our purpose was to bettereducate directors, senior executives, employees, and suppliers on knowledge aboutanti-commercial bribery and anti-corruption, as well as to promote a culture of integrity.
100% of existing suppliers signed theCommitment to Business Principles.
The makeup factory obtained the Sedex Members Ethical Trade Audits (SMETA) certi?cation,which covers labor standards, health, safety and working environment, environmental man-agement, and business ethics.
105106
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Performance Data Sheet
ESG Performance Data Sheet
Environmental data
Unit202120222023Disclosure ItemNumber of incidents involving penalties for violatingenvironmental protection laws and regulationsPower consumption
Electricity consumption per CNY10,000 of revenueTotal consumption of natural gasNatural gas consumption per CNY10,000 ofrevenueConsumption of gasoline
Consumption of diesel
Total consumption of waterWater consumption per CNY10,000 of revenueTotal consumption of recycled waterProportion of recycled water in total waterconsumptionTotal consumption of packaging materials
Consumption of packaging materials perCNY10,000 of revenueTotal waste gas emissions
Total waste gas emissions per CNY10,000 ofrevenue
Discharge of hazardous waste per CNY10,000 ofrevenueTotal consumption of green electricity
IncidentMegawatt-hoursKilowatt-hours/
CNY10,000Cubic metersCubic meters/
CNY10,000
LitersLitersCubic metersCubic meters/
CNY10,000Cubic meters
%Tonnes
Kilograms/CNY10,000Cubic metersCubic meters/
CNY10,000
Grams/CNY10,000Megawatt-hours
Industrial waste water dischargeIndustrial waste water discharge per CNY10,000 ofrevenueCOD emissions per CNY10,000 of revenue in wastewaterBOD emissions per CNY10,000 of revenue in wastewaterAmmonia nitrogen (NH3-N) emissions (kg) in wastewater
Chemical oxygen demand (COD) discharge inwaste waterBiochemical oxygen demand (BOD) (COD)discharge in waste waterAmmonia nitrogen (NH3-N) discharge in wastewater
Total amount of general waste generated
Discharge of general waste per CNY10,000 ofrevenueTotal amount of hazardous waste generated
Cubic metersCubic meters/CNY10,000Grams/CNY10,000Grams/CNY10,000Grams/CNY10,000
KilogramsKilograms
Kilograms
TonnesKilograms/CNY10,000Tonnes
12,161.96
26.25
295,436.00
0.64
291,954.00
42,614.00208,614.90
0.45
15,000.00
7.19
21,424.34
46.24
16,368,000.00
35.33
13,500.00
0.03
1.46
0.29
0.15
675.00
135.00
67.50
751.84
1.62
1.00
15,970.07
25.01
368,936.00
0.58
52,620.0039,903.00253,488.70
0.40
13,000.00
5.13
27,524.98
43.11
16,080,000.26
25.18
20,219.00
0.03
1.59
0.27
0.16
1016.00
172.00
104.40
1267.63
1.99
0.98
17,728.44
19.91
397,113.82
0.45
86,678.7369,948.07272,865.52
0.31
19,000.00
6.96
418,867.60
47.02
38,376,000.26
43.10
8,318.953,838.99
24,329.00
0.03
1.30
0.27
0.07
1160.00
242.00
60.00
1638.79
1.84
0.58
Unit202120222023Disclosure Item
Total greenhouse gas emissions (Scope 1, Scope 2) Scope 1 greenhouse gas emissions
?
Scope 2 greenhouse gas emissions
?
Scope 3 greenhouse gas emissions
Greenhouse gas emissions (Scope 1, Scope 2) per
CNY10,000 of revenue
Tonnes of CO
eTonnes of CO
eTonnes of CO
eTonnes of CO
eKilograms CO
e/CNY10,000
2.16
8,426.861,360.777,066.10
/
18.19
1.53
7,933.901,015.546,918.35
/
12.42
0.65
7,420.892,054.665,366.2388,194.52
8.33
Note:
[1] The data for 2021 and 2022 covers the of?ce building and R&D facilities at the Proya Headquarters, as well as the skincare and makeup factories at the Huzhou production base.The data for 2023 covers of?ce buildings at the Proya Headquarters, the skincare (including the newly constructed logistics center during the Reporting Period) and makeup factoriesat the Huzhou production base. The current data covers all the main operations of Proya’s cosmetics business, excluding sales of?ces in different locations.[2] The electricity consumption includes the usage of outsourced electricity as well as clean energy. The growth of increase in electricity consumption in 2023 was caused by business growth.[3]The total consumption of green electricity includes solar power and outsourced green electricity. The increase in green electricity consumption in 2023 was caused by our new in-stallations of photovoltaic power generation equipment and purchased green electricity.[4] In 2023, our visit activities returned to normal due to the removal of external factors. In addition, we purchased new gasoline cars, which caused an increase in gasoline consumption.[5] In 2023, due to business growth, diesel consumption increased.[6]The total consumption of packaging materials includes primary packaging, secondary packaging, and packaging accessories. In 2023, due to business growth, the usage of pack-aging materials increased.[7] In 2023, the waste gas treatment facility for the cream production line in the skincare factory was of?cially launched, resulting in an increase in waste gas generation. This facilitycan effectively collect waste gas and dust generated in the production process, thereby reducing the emission of dust and organic waste gas.[8] In 2023, the Company improved the scope of general waste statistics, which now includes household waste, general production waste, as well as recyclable waste such as card-board, plastic ?lm, and plastic barrels. Data traceability was also implemented. After veri?cation, the data for the past three years regarding general waste performance indicators arebased on the disclosed data in this year's report.[9In 2023, the Company improved the scope of hazardous waste statistics and implemented data traceability. After veri?cation, the data for the past three years regarding hazardouswaste performance indicators are based on the disclosed data in this year's report.[10] In 2023, the Company conducted an inventory check based on ISO 14064 and passed the veri?cation. The veri?cation certi?cate is available in the "Carbon Veri?cation Results" section.[11] For the 2021-2022 period, carbon emissions were calculated for gasoline, diesel, and natural gas. The calculation method refers to the Ministry of Ecology and Environment's"Calculation Method and Reporting Guide for Corporate Greenhouse Gas Emissions - Power Generation Facilities" (2022 revised edition). In 2023, the Company improved the scopeof carbon emissions calculation for Scope 1, which now includes gasoline, diesel, natural gas, ?re extinguishers, and air conditioning refrigerants. Additionally, gasoline and dieselconsumption increased, leading to an increase in Scope 1 carbon emissions. The calculation factors for Scope 1 in 2023 are based on the relevant factors in the "IPCC NationalGreenhouse Gas Inventory Guidelines."[12] Scope 2 calculates the carbon emissions of electricity supplied by power grids. The electricity generated by photovoltaics and the green electricity purchased by the Companyare not included in the calculation of carbon emissions. The method for calculating greenhouse gas emissions is subject to the Guidelines for Enterprise-Generated Greenhouse GasEmission Calculation and Reporting by Power Generation Facilities (2022 revised edition) published by the Ministry of Ecology and Environment. Calculation formula for greenhousegas emissions: Electricity supplied by nation-wide power grid × Average emission factor on the nation-wide power grid. The electricity emission factor of MWh2021 is 0.5810tCO
/MWh; that of 2022 and 2023 is 0.5703tCO
/MWh, which is the average emission factor on the nation-wide power grid speci?ed in the Notice on the Reporting and Management ofGreenhouse Gas Emissions by Enterprises in the Power Generation Industry for 2023-2025.
107108
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Performance Data Sheet
Product and Customer Reasponsibility
Unit202120222023Disclosure Item
Number of complaints received regarding productsand servicesComplaint resolution rate
Total number of incidents involving violations of laws andregulations in marketing activities (including advertising,promotion, and sponsorship)
Total number of incidents involving violations of regulationson product and service information and labeling as well asvoluntary principles
Number of incidents involving violations of laws andregulations related to health and security in products andservices
Number of incidents involving violations of regulationsrelated to customer privacy protection
Incidents
%
IncidentsIncident
Incident
Time
3,925100%
2,120100%
100%
Note:
[1] During the International Women’s Day promotion in 2023, Meiligu and Ningbo Tangyu were imposed with administrative penalties by the local market supervision and administra-tion authority for mistakenly targeting the wrong audience when sending promotional text messages using a third-party tool, resulting in the accusation of “sending advertisementswithout the consent of others.” We have organized relevant departments to comprehensively review and optimize the SMS marketing veri?cation process to prevent similar incidentsfrom happening again.In 2023, Meiligu was imposed with an administrative penalty by the local market supervision and administration authority for omitting some label text on the product promotion pageon certain e-commerce platforms, resulting in the accusation of “advertising with misleading content to deceive consumers.” We have organized relevant departments to compre-hensively review and improve the process, and strengthen the supervision of marketing and promotion campaigns to prevent similar incidents from happening again.Supply chain management
Unit202120222023Disclosure Item
Total number of suppliers
Number of suppliers from the Chinese MainlandNumber of suppliers from Hong Kong, Macau, Taiwan, andother countries or regionsProportion of suppliers receiving environmental, labor, andethics assessments
Proportion of suppliers having passed environmental, labor,and ethics assessments
3
CompaniesCompaniesCompanies
%%
33.38
100.00
30.41
95.05
17.88
96.30
Note:
[1] The data of suppliers in 2022 covers suppliers of materials and services in the production stage as well as suppliers involved in of?ine sales, but excludes suppliers related to brandmarketing. In 2023, we further re?ned our statistical caliber. The statistical data of suppliers covers suppliers of materials and services in the production stage as well as suppliers in-volved in of?ine sales and brand marketing, but excludes brand ambassadors and KOLs.[2] Proportion of suppliers receiving environmental, labor, and ethics assessments = Number of suppliers receiving environmental, labor, and ethics assessments / Total number ofsuppliers (end of the Reporting Period).[3] Proportion of suppliers having passed environmental, labor, and ethics assessments = Number of suppliers having passed environmental, labor, and ethics assessments / Numberof suppliers receiving environmental, labor, and ethics assessments.
Employee data
Unit202120222023Disclosure ItemEmployment
Occupational health and safety
Employee training and development
Number of employees
Number of female employeesNumber of employees aged 30 and belowNumber of male employees
Number of workdays lost due to occupational injury
Coverage of training for employees
Proportion of male employees covered by trainingProportion of female employees covered by trainingProportion of grassroots employees covered by training
Number of employees who have died as a result of work-related injuriesProportion of employees who have died as a result of work-related injuries
Number of employees aged 30 to 50Number of employees aged 50 and aboveNumber of employees working in the Chinese MainlandNumber of grassroots employeesNumber of mid-level managersNumber of senior managersProportion of female employees in mid-level management
Proportion of female employees in senior management
Number of R&D personnel
Number of penalties for violating labor and employmentlaws and regulations
PeoplePeoplePeoplePeople
Day
%%%%
People
%
PeoplePeoplePeoplePeoplePeoplePeople
%%PeopleIncident
Number of employees working in Hong Kong, Macau,Taiwan, and other countries or regions
People
3,1772,4261,408
46.27
27.96
51.94
44.31
1,723
3,1772,875
62.46
17.65
2,9712,0941,584
90.51
74.12
97.37
89.14
1,338
2,9712,596
59.50
23.53
2,8442,2021,192
49.75
28.50
55.95
52.23
1,612
2,844
2,598
60.17
20.00
109110
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Performance Data Sheet
Unit202120222023Disclosure Item
Employee training and developmentProportion of senior managers covered by trainingAverage duration of training received by employees
Average duration of training received by male employeesAverage duration of training received by female employeesAverage duration of training received by grassrootsemployeesAverage duration of training received by mid-level managersAverage duration of training received by senior managersEmployee turnover rate
Male employee turnover rateFemale employee turnover rateTurnover rate of employees aged 30 and belowTurnover rate of employees aged 30 to 50Turnover rate of employees aged 50 and above
%HoursHoursHoursHoursHoursHours%%%%%%Note:
[1] The data of employees only covers full-time employees bound by labor contracts at the end of the Reporting Period, and does not include outsourced personnel or part-timeemployees.[2] Proportion of female employees in mid-level management = Number of female middle-level managers / Number of mid-level managers (end of the Reporting Period).[3] Proportion of female employees in senior management = Number of female senior managers / Number of senior managers (end of the Reporting Period).[4] Coverage of training for employees = Number of employees in this category trained during the Reporting Period (end of the Reporting Period) / Total number of employees inthis category (end of the Reporting Period).[5] Average duration of training received by employees = Total duration of training for employees in this category (end of the Reporting Period) / Total number of employees in thiscategory (end of the Reporting Period) In 2022, the training duration does not include anti-corruption training. In 2023, we adjusted the statistic scope of employee training to includethe data of anti-corruption training.[6] Employee turnover rate = Number of employees in this category who left during the Reporting Period / Total number of employees in this category (end of the Reporting Period)In 2023, Proya downsized our of?ine business team and reduced the number of physical stores, resulting in an increase in the employee turnover rate.
Proportion of mid-level managers covered by training%
64.71
17.40
8.53
20.15
18.05
11.51
5.76
28.83
29.16
28.73
34.16
25.01
8.70
64.91
100.00
18.04
14.30
19.61
17.76
20.47
10.09
43.86
22.01
53.01
36.49
53.44
20.41
100.00
19.31
4.00
23.77
20.60
6.03
26.79
18.22
29.29
27.35
26.61
17.50
25.11
Anti-corruption
Note:
[1] The data of anti-corruption training in 2021 is not calculated.
Note:
[1] Investments in public welfare include funds and materials donated by Proya to various community philanthropic and charitable activities. The decrease in the actual investmentamount in public welfare in 2022 was caused by our changing the strategies for public welfare and charity investments, and also by the suspension of some charitable activities due toexternal factors. Our involvement in community undertakings returned to normal in 2023, leading to an increase in the investment amount.[2] In 2021, we did not carry out any offline volunteer services due to external factors. In 2022, the total duration of volunteer services increased because we organized employeesto provide volunteer services in the community. In 2023, we carried out volunteer services as usual, so the total duration of volunteer services continued to grow. Particularly, theFoundation and the Company encouraged employees to actively partake in volunteer services.
Unit202120222023Disclosure Item
Number of corruption lawsuits filed against the issuer orits employees and already concluded during the ReportingPeriodCoverage of anti-corruption training for all directorsAverage duration of anti-corruption training receivedby each directorCoverage of anti-corruption training for all employeesAverage duration of anti-corruption training receivedby each employee
Incident%Hours
%Hours
100100
31.50
100100
3.022.50
Community and public welfare
Unit202120222023Disclosure ItemAmount of investment in public welfare
Amount of charitable donationTotal duration of volunteer services
CNY10,000CNY10,000CNY10,000
370.60
370.00
143.46
143.46
285.00
866.12
850.14
765.00
111112
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
ESG Performance Data Sheet
Awarding BodyAwarding BodyTitle of HonorTitle of HonorNational Intellectual Property Advantageous Enterprise
Brand of China Cosmetics Industry (Facial Skincare) 2022 - ProyaSelected Upgraded and Innovative Cosmetic Product - Proya DoubleEffect Brightening Essence
Green Supply Chain Management Company 2023
Brand of China Cosmetics Industry (Facial Skincare) 2022 - Hapsode
No. 1 of Top 10 Enterprises in the Cosmetics Sector of ChinaLight Industry (Universal Leaderboard)
Shopee 2023 Cross-Border Elite Brand Award - Proya
High-Tech Enterprise
2023 Super Growth Brand - ProyaIntelligent Factory of Zhejiang 2023
Upgraded and Innovative Cosmetic Product - Proya Double Effect
Brightening EssenceAdvanced Unit in Cosmetic Standardization of 2023Four-Star Headquarters Enterprise in HangzhouHonorary Title of Hangzhou “Kunpeng Enterprise”Civilized Unit of HuzhouOrganizational Donations Prize in the Fourth Wenzhou Charity Award17th Top 100 Companies Listed on the Main Board by Market ValueChina Tianma Award of Investor Relations for Listed CompaniesChina Sunshine Board Secretary Award for Chinese Listed CompaniesAnnual Entrepreneurship Vanguard for Chinese Listed CompaniesCapital Market Value Ranking: Annual Return AwardListed Company with High Quality DevelopmentIR Team with the Best Institutional Coverage 2023Star Listed Company of 2023
Provincial Industrial Design Center 2023
2023 Super Growth Brand - TIMAGE
Outstanding Practical Case of the Board Office ofListed Companies
Outstanding Chinese Cosmetics Brand 2023 (Face Cream, Emulsion) - ProyaThird Prize in the Zhejiang First Intellectual PropertyTrademark Award
Dark Horse Brand of the Year 2023 - Off & Relax
Identified Future Factory and Intelligent Factory (Digital Workshop) ofZhejiang Province 2023
Outstanding Chinese Cosmetics Brand 2023 (Essence) - Proya
China National Intellectual Property Administration
China Association of Fragrance, Flavor and Cosmetics IndustriesChina Association of Fragrance, Flavor and Cosmetics Industries
General Office of the Ministry of Industry and InformationTechnology of the PRC
China Association of Fragrance, Flavor and Cosmetics Industries
China National Light Industry Council
Shopee
Department of Science and Technology of Zhejiang Province
Cosmetic NewspaperEconomy and Information Technology Department of Zhejiang
Cosmetic NewspaperSecretariat of Zhejiang Provincial Cosmetics StandardizationTechnology CommitteeHangzhou Municipal Committee of the Communist Party ofChina and Hangzhou Municipal People’s GovernmentHangzhou Municipal Committee of the Communist Party ofChina and Hangzhou Municipal People’s GovernmentHuzhou Municipal Committee of the Communist Party of ChinaHuzhou Municipal People’s GovernmentWenzhou Municipal People’s GovernmentThe Securities TimesThe Securities TimesThe Securities TimesThe Securities TimesYICAIThe Times WeeklyComeinCosmetic Newspaper
Economy and Information Technology Department of Zhejiang
Cosmetic Newspaper
China Association for Public Companies
Cosmetic NewspaperThe People’s Government of Zhejiang Province
Yi Beauty Lifestyle
Division of Technological Innovation, Economy andInformation Technology Department of Zhejiang
Cosmetic Newspaper
Company honors and social recognition
Second China Top 100 Benchmark Smart Factories 2023Outstanding Case of Innovation in Anti-Infringement and Anti-CounterfeitingMOKA Most Popular Employer Brand Among College StudentsThe 20th People’s Ingenuity Brand Award
e-works.net.cn
Anti-Infringement and Anti-Counterfeit Alliance (CAASA)
Moka+, HKU Institute for China Business, HRflag
People.cn
113114
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Indicator Index
Indicator Index
Report SectionTerm and Disclosed Information
8.1 Overview
8.2 Principles of operation
8.3 Social responsibility planning and working
mechanism
8.4 Social contribution per share
8.6
??
?
8.8
??
?
8.8
??
?
8.8
??
?
8.8
??
?
8.8
??
?
8.8
??
?
8.8
??
?
8.8
??
?
8.9
??
?
8.9
??
?
8.9
??
?
8.6
??
?
8.5 Disclosure of corporate social responsibility
report
8.7 Employee benefits
8.6
??
?Establishment of a socialresponsibility systemShortcomings and issues in fulfilling socialresponsibilities
Comply with environmental protection laws,regulations, and industry standardsEnvironmental protection planUse of natural resourcesDisposal of pollutantsPollution control facilitiesPayment of taxes and fees related toenvironmental protectionEnvironmental safety of the supply chainOther environmental protectionresponsibilitiesEnvironmental protection policies,objectives, and achievementsTotal resource consumption throughout theyearInvestment in environmental protection anddevelopment of environmental technology
Improvement measures and specific timeschedule
Environmental, Social, and CorporateGovernance SystemCompliance OperationProya Sustainability Governance SystemESG Governance SystemESG Performance Data Sheet
Marketing activities (including advertising, promotion,and sponsorship) as well as products and serviceinformation and labeling
Environmental management systemEnvironmental ResponsibilityResource conservationEmissions and wasteEmissions and wasteEnvironmental management systemBuilding a Responsible Supply ChainEnvironmental ResponsibilityEnvironmental ResponsibilityESG Performance Data SheetClimate change mitigation and adaptation
We have developed correspondingmanagement regulations, and arrangedtraining for relevant business departments.
Report Description
Employee rights and benefits
Environmental ResponsibilityProduct and Customer ResponsibilityEmployee ResponsibilitiesCommunity Responsibility
Index for Guidelines No. 1 for the Self-Regulatory Rules of Companies Listed onthe Shanghai Stock Exchange - Regulation of Operations (2023)
Report SectionTerm and Disclosed Information
8.9
??
?
Types, quantities, concentrations, anddestinations of pollutant emissions
8.9
??
?
8.9
??
?
8.9
??
?
8.9
??
?
8.9
??
?
8.10
??
?
8.10
??
?
8.10
??
?
8.10
??
?
8.10
??
?
8.10
??
?
8.11 Environmental inspections
8.12 Key pollutant discharging units
8.13
??
?
8.13
??
?
8.13
??
?
8.13
??
?
8.14
??
?
8.14
??
?
8.14
??
?
8.14
??
?
Construction and operation of environmentalprotection facilitiesWaste management, disposal, and recyclingof discarded productsVoluntary agreements signed withenvironmental protection departmentsRecognition from environmental protectiondepartmentsOther voluntary information disclosuresNew, renovated, and expanded constructionsor major investmentsViolation of environmental laws and regulationsand corresponding penaltiesMajor environmental lawsuits or seizure, freezing,detention, pledge, or mortgage of assetsKey pollutant discharging unitsImpact of newly enacted laws and regulationson the companyMajor environmental protection events
Laws, regulations, and industry standards onproduct safetyProduction environment and processQuality assurance mechanism and emergencyresponse plan for product safetyOther production and product safetyresponsibilitiesEmployee management system and measuresagainst violationsPrevention of occupational hazards andcomplementary safety measuresEmployee trainingProtection of other employee rights andinterests
Emissions and wasteEnvironmental ResponsibilityEmissions and wasteN/ACompany Performance HighlightsWater ManagementN/AN/AN/AN/AN/AN/AN/AEnvironmental ResponsibilityProya is not a key pollutant discharging unitProduct and Customer ResponsibilityProduct and Customer ResponsibilityProduct and Customer ResponsibilityProduct and Customer ResponsibilityEmployee rights and benefitsEmployee Health and SafetyEmployee training and developmentEmployee rights and benefits
8.15 Scientific ethicsInnovations in research and development
115116
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Indicator Index
Proya Cosmetics Co., Ltd. reports information in this GRI Index according to GRI standards for the period from January 1, 2023, to December 31, 2023.GRI 1: Foundation 2021
Terms of UseReference to GRI 1
Index for Global Reporting Initiative (GRI) Standards (2021)
SectionGRI StandardsDisclosure Item
2-1 Organizational details2-2 Entities included in the organization’ssustainability reporting2-3 Reporting period, frequency, and contact point2-4 Restatements of information2-6 Activities, value chains, and other businessrelationships2-7 Employees2-9 Governance structure and composition2-12 Role of the highest governance body in overseeing themanagement of impacts2-13 Delegation of responsibility for managing impacts
2-19 Remuneration policies2-22 Statement on sustainable development strategy
2-14 Role of the highest governance body in sustainability reporting2-16 Communication of critical concerns2-17 Collective knowledge of the highest governance body
GRI 2: GeneralDisclosures (2021)
About ProyaReport DescriptionReport DescriptionReport DescriptionMain Business and Sub-BrandsSustainable Value Chain: Sharing BeautyProduct quality and safetySupply Chain ResponsibilityESG Performance Data SheetEmployee ResponsibilitiesESG Performance Data SheetProya ESG Management StructureCorporate governance systemProya ESG Management StructureCorporate governance systemProya ESG Management StructureCorporate governance system
ESG Governance SystemCorporate GovernanceProya Sustainability Governance SystemProya ESG Management Structure
Proya ESG Management StructureStakeholder communicationESG Governance System
SectionGRI StandardsDisclosure Item
2-23 Policy commitments
3-1 Process to determine material topics
301-1 Materials used by weight or volume
302-1 Energy consumption within the organization
2-24 Embedding policy commitments
3-2 List of material topics
301-2 Recycled input materials used
302-2 Energy consumption outside the organization
203-1 Infrastructure investments and services supported
205-2 Communication and training about anti-corruption policiesand procedures
201-1 Direct economic value generated and distributed
201-3 Defined benefit plan obligations and other retirement plans201-2 Financial implications and other risks and opportunities dueto climate change
2-25 Processes to remediate negative impacts
3-3 Management of material topics
301-3 Reclaimed products and their packaging materials
302-3 Energy intensity
203-2 Significant indirect economic impacts
205-3 Confirmed incidents of corruption and actions taken
2-26 Mechanisms for seeking advice and raising concerns
2-29 Approach to stakeholder engagement
2-27 Compliance with laws and regulationsGRI 2: GeneralDisclosures (2021)
GRI 3: Material Topics(2021)
GRI 301: Materials (2016)
GRI 302: Energy (2016)
GRI 203: IndirectEconomic Impacts(2016)GRI 205: Anti-Corruption (2016)
GRI 201: EconomicPerformance (2016)
Co-Founders’ Message
Identification of material topics
ESG Performance Data Sheet
ESG Performance Data Sheet
Co-Founders’ Message
Identification of material topics
ESG Performance Data Sheet
ESG Performance Data Sheet
Community Responsibility
Anti-corruption and business ethics
Company Performance Highlights
Employee rights and benefitsSustainable Business: Creating BeautyClimate change mitigation and adaptation
Compliance management system
Identification of material topics
ESG Performance Data Sheet
ESG Performance Data Sheet
Social welfare
Anti-corruption and business ethics
Compliance management system
Stakeholder communication
Environmental ResponsibilityProduct and Customer ResponsibilitySupply Chain ResponsibilityEmployee ResponsibilitiesCommunity ResponsibilityCorporate GovernanceCompliance Operation
117118
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Indicator Index
SectionGRI StandardsDisclosure Item
302-4 Reduction of energy consumption
303-1 Interactions with water as a shared resource303-2 Management of water discharge-relatedimpacts303-3 Water withdrawal303-4 Water discharge303-5 Water consumption305-1 Direct (Scope 1) GHG emissions305-2 Energy indirect (Scope 2) GHG emissions305-3 Other indirect (Scope 3) GHG emissions305-4 GHG emissions intensity305-5 Reduction of GHG emissions
306-1 Waste generation and significant waste-relatedimpacts306-2 Management of significant waste-relatedimpacts306-3 Waste generated306-4 Waste diverted from disposal306-5 Waste directed to disposal308-1 New suppliers that were screened usingenvironmental criteria308-2 Negative environmental impacts in the supplychain and actions taken401-1 New employee hires and employee turnover401-2 Benefits provided to full-time employees that are not providedto temporary or part-time employees401-3 Parental leave403-1 Occupational health and safety managementsystem403-2 Hazard identification, risk assessment, andincident investigation403-3 Occupational health services
305-7 Nitrogen oxides (NOx), sulfur oxides (SOx), and other significantwaste gases
302-5 Reductions in energy requirements of productsand servicesGRI 302: Energy (2016)
GRI 303: Water andEffluents (2018)
GRI 305: Emissions(2016)
GRI 306: Waste (2020)
GRI 308: SupplierEnvironmentalAssessment 2016GRI 401: Employment(2016)
GRI 403: OccupationalHealth and Safety (2018)
Resource conservation
Resource conservationResource conservationESG Performance Data SheetESG Performance Data SheetESG Performance Data SheetESG Performance Data SheetESG Performance Data SheetESG Performance Data SheetESG Performance Data SheetESG Performance Data Sheet
Emissions and wasteEmissions and wasteESG Performance Data SheetESG Performance Data SheetESG Performance Data SheetBuilding a Responsible Supply ChainBuilding a Responsible Supply ChainESG Performance Data SheetESG Performance Data SheetESG Performance Data SheetOccupational health and safetyOccupational health and safetyOccupational health and safety
ESG Performance Data Sheet
Resource conservation
SectionGRI StandardsDisclosure Item
GRI 404: Training andEducation (2016)GRI 405: Diversity andEqual Opportunity(2016)GRI 406: Non-discrimination (2016)GRI 408: Child Labor(2016)GRI 409: Forced orCompulsory Labor (2016)GRI 413: LocalCommunities (2016)
GRI 418: CustomerPrivacy (2016)
GRI 414: Supplier SocialAssessment (2016)GRI 416: CustomerHealth and Safety (2016)
GRI 417: Marketing andLabeling (2016)
GRI 403: OccupationalHealth and Safety (2018)
403-6 Promotion of worker healthOccupational health and safety403-7 Prevention and mitigation of occupational health and safetyimpacts directly linked by business relationships403-8 Workers covered by an occupational health and safetymanagement system403-9 Work-related injuries403-10 Work-related ill health404-1 Average hours of training per year per employee404-2 Programs for upgrading employee skills and transitionassistance programs405-1 Diversity of governance bodies and employees406-1 Incidents of discrimination and corrective actions taken408-1 Operations and suppliers at significant risk for incidents of childlabor409-1 Operations and suppliers at significant risk for incidents offorced or compulsory labor413-1 Operations with local community engagement, impactassessments, and development programs
418-1 Substantiated complaints concerning breaches of customerprivacy and losses of customer data
414-1 New suppliers that were screened using social criteria416-1 Assessment of the health and safety impacts of product andservice categories417-1 Requirements for product and service information and labeling
414-2 Negative social impacts in the supply chain and actions taken416-2 Incidents of non-compliance concerning the health and safetyimpacts of products and services
417-2 Incidents of non-compliance concerning product and serviceinformation and labeling417-3 Incidents of non-compliance concerning marketingcommunications
Occupational health and safetyOccupational health and safetyESG Performance Data SheetOccupational health and safetyESG Performance Data SheetDevelopment of human capitalESG Performance Data SheetEmployee rights and benefitsEmployee rights and benefitsEmployee rights and benefitsSocial welfareCharitable events
ESG Performance Data Sheet
Supply chain managementProduct quality and safety
Product quality and safetyCustomer service and rights protection
Building a Responsible Supply ChainESG Performance Data Sheet
ESG Performance Data SheetESG Performance Data Sheet
403-4 Worker participation, consultation, and communication onoccupational health and safety403-5 Worker training on occupational health and safety
Employee rights and benefitsOccupational health and safety
119120
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Indicator Index
Index for the United Nations Sustainable Development Goals (SDGs)
Report Section SDGSDG Target
Target 1.4: By 2030, ensure that all men and women, in particular the poor and the vulnerable,have equal rights to economic resources, as well as access to basic services, ownership andcontrol over land and other forms of property, inheritance, natural resources, appropriate newtechnology and ?nancial services, including micro?nance.Target 3.4: By 2030, reduce by one third premature mortality from non-communicable diseasesthrough prevention and treatment and promote mental health and well-being.
Target 5.1: End all forms of discrimination against all women and girls everywhere.
Target 4.1: By 2030, ensure that all girls and boys complete free, equitable and quality primaryand secondary education leading to relevant and effective learning outcomes.
Target 6.3: By 2030, improve water quality by reducing pollution, eliminating dumping and mini-mizing release of hazardous chemicals and materials, halving the proportion of untreated wastewater and substantially increasing recycling and safe reuse globally.
Target 7.2: By 2030, increase substantially the share of renewable energy in the global energy mix.
Target 4.7: By 2030, ensure that all learners acquire the knowledge and skills needed to promotesustainable development, including, among others, through education for sustainable develop-ment and sustainable lifestyles, human rights, gender equality, promotion of a culture of peaceand non-violence, global citizenship and appreciation of cultural diversity and of culture’s con-tribution to sustainable development.
Target 6.4: By 2030, substantially increase water-use ef?ciency across all sectors and ensure sus-tainable withdrawals and supply of freshwater to address water scarcity and substantially reducethe number of people suffering from water scarcity.
Target 7.3: By 2030, double the global rate of improvement in energy ef?ciency.
Charitable events
Sustainable SocialEcosystem: EmpoweringBeautySocial welfare
Sustainable SocialEcosystem: EmpoweringBeautySocial welfare
Charitable events
Emissions and waste
Energy management
Sustainable SocialEcosystem: EmpoweringBeautySocial welfare
Water Management
Target 8.5: By 2030, achieve full and productive employment and decent work for all women and men,including for young people and persons with disabilities, and equal pay for work of equal value.Target 8.7: Take immediate and effective measures to eradicate forced labor, end modern slav-ery and human traf?cking and secure the prohibition and elimination of the worst forms of childlabor, including recruitment and use of child soldiers, and by 2025 end child labor in all its forms.Target 8.8: Protect labor rights and promote safe and secure working environments for all workers,including migrant workers, in particular women migrants, and those in precarious employment.
Employee rights and bene?tsEmployee rights and bene?tsBuilding a responsible sup-ply chainEmployee rights and bene?tsBuilding a responsible supplychainEmployee rights and bene?tsOccupational health and safety
Target 9.4: By 2030, upgrade infrastructure and retro?t industries to make them sustainable, withincreased resource-use efficiency and greater adoption of clean and environmentally soundtechnologies and industrial processes, with all countries taking action in accordance with theirrespective capabilities.Target 9.5: Enhance scienti?c research, upgrade the technological capabilities of industrial sec-tors in all countries, in particular developing countries, including, by 2030, encouraging innova-tion and substantially increasing the number of research and development workers per 1 millionpeople and public and private research and development spending.
Resource conservationInnovations in research anddevelopment
Report SectionSDGSDG Target
Target 12.2: By 2030, achieve the sustainable management and ef?cient use of natural resources.Target 12.5: By 2030, substantially reduce waste generation through prevention, reduction, re-cycling and reuse.
Target 10.2: By 2030, empower and promote the social, economic and political inclusion of all,irrespective of age, sex, disability, race, ethnicity, origin, religion or economic or other status.
Target 11.6: By 2030, reduce the adverse per capita environmental impact of cities, including bypaying special attention to air quality and municipal and other waste management.
Target 12.6: Encourage companies, especially large and transnational companies, to adopt sus-tainable practices and to integrate sustainability information into their reporting cycle.Target 12.8: By 2030, ensure that people everywhere have the relevant information and aware-ness for sustainable development and lifestyles in harmony with nature.
Resource conservationGreen packagingEmissions and waste
Sustainable Social Ecosys-tem: Empowering BeautySocial welfareEmissions and waste
Report DescriptionSustainable Value Chain:
Sharing BeautyTarget 13.3: Improve education, awareness-raising and human and institutional capacity on cli-mate change mitigation, adaptation, impact reduction and early warning.
Target 14.1: By 2025, prevent and signi?cantly reduce marine pollution of all kinds, in particularfrom land-based activities, including marine debris and nutrient pollution.
Target 15.2: By 2020, promote the implementation of sustainable management of all types offorests, halt deforestation, restore degraded forests and substantially increase afforestationand reforestation globally.Target 16.5: Substantially reduce corruption and bribery in all their forms.
Climate change mitigation
and adaptation
Green packaging
Building a responsible sup-
ply chain
Anti-corruption and busi-
ness ethics
121122
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Report Description
This Report covers the cosmetics business of Proya Cosmetics Co., Ltd. and its subsidiaries. For more details, please refer to the section “Appendix:
Scope of the report.”
Integrity
Report DescriptionThe Proya Sustainability & Environmental, Social, and Governance (ESG) Report 2023 (hereinafter referred to as “this Report”) isthe fourth sustainability and ESG report released by Proya Cosmetics Co., Ltd. It outlines the principles and performance of ProyaCosmetics Co., Ltd. in sustainable development and ESG governance in 2023, including environmental, social, and corporate gov-ernance issues of concern to key stakeholders.
This Report is formulated based on Guidelines No. 1 for the Self-Regulatory Rules of Companies Listed on the Shanghai Stock Exchange - Regulationof Operations (2023) released by the Shanghai Stock Exchange. It also references the Global Reporting Initiative (GRI) Standards (2021) and the Unit-ed Nations Sustainable Development Goals (SDGs).
We identify material topics that are important to stakeholders and the company, and present them as a focus of this Report. While reporting materialtopics in this Report, we also consider the features of the industry in which we operate the company and the region we are located. For a detailedanalysis of material topics and the results, please refer to the “Identi?cation of material topics” and “Stakeholder communication” sections in thisReport. Meanwhile, this Report prioritizes material topics related to the environment, society, and corporate governance.Materiality
We do our best to ensure the accuracy of the information in this Report. Particularly, the data caliber, calculation basis, and assumed conditions areprovided for the measurement of quantitative information to ensure that calculation errors will not mislead the users of the information in this Report.For information about quantitative measurements and additional notes, please refer to the “ESG Performance Data Sheet” section of this Report.The Board of Directors warrants that this Report does not contain any false information, misleading statements, or signi?cant omissions.
Accuracy
This Report re?ects objective facts and provides unbiased disclosure of both positive and negative information about the company. We havesearched on the Shanghai Qingyue Credit Database for the subject in this Report and did not ?nd any undisclosed negative events that should havebeen disclosed during the Reporting Period.Balance
This Report is released in both Simpli?ed Chinese and English. This Report contains tables, diagrams, and a glossary of professional terms, which areused to help readers better understand the textual content of this Report. To facilitate stakeholders to access information more quickly, this Reportcontains a table of contents and an index for ESG standards.
Clarity
This Report discloses key quantitative performance indicators and aims to provide as much historical data as possible. In this Report, indicators aresubject to consistent statistical and analytical methods in different reporting periods. Where any statistical and analytical methods are changed, theywill be fully explained as a note in the Report, so that stakeholders can perform meaningful analysis and evaluate our ESG performance and trends.Quantification and consistency
The cases and data in this Report are based on the actual records or financial reports generated during our operation. The sources of disclosed dataand calculation processes are all traceable and can be used for third-party verification and inspection.VerifiabilityThis Report is an annual report that covers the period from January 1, 2023, to December 31, 2023. We do our best to release the annual report assoon as possible after the end of the reporting year, so that stakeholders will have information they need to make informed decisions.Timeliness
This Report applies the principles of the GRI Standards 2021 to ensure the quality and appropriate presentation of reported information.
Basis of preparation
Principles of reporting
Scope of organization: This Report covers the cosmetics business of Proya Cosmetics Co., Ltd. and its subsidiaries. The statisticalscope of some data may vary. Explanations have been provided in the data section. For more details, please refer to the section“Appendix: Scope of the report.”The abbreviations in this Report are de?ned as follows:
Scope of the report
Proya promises that this Report does not contain any false information, misleading statements, or significant omissions. The board of directors ofProya assumes general responsibility for ESG management and reporting.We have searched on the Shanghai Qingyue Credit Database for the information of Proya Cosmetics Co., Ltd. involved in this Report, and did notfind any negative environmental information.
If you have any questions about this Report or Proya’s ESG governance, please don’t hesitate to contact us using the following methods.Contact address: No. 588 Xixi Road, Xihu District, Hangzhou City, Zhejiang Province, ChinaEmail: proya-group@proya.comTel.: +86-571-8735-2850Website: www.proya-group.com
The data and cases in this Report are based on the actual records or ?nancial reports generated during our operation.The ?nancial data in this Report is presented in CNY. If there is any discrepancy between the ?nancial data and our annual ?nancial report, the annual?nancial report shall prevail.Data description
Reliability assurance
Contact us
AbbreviationDefinition
Proya Cosmetics Co., Ltd.Proya Cosmetics Co., Ltd. Huzhou BranchZhejiang Beauty Cosmetics Co., Ltd.Proya, the company, weSkincare factoryMakeup factory, Zhejiang Beauty
123124
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Appendix: Scope of the report
Number
Included in This
ReportCompany Name
Proya Cosmetics Co., Ltd.Proya Cosmetics Co., Ltd. Huzhou BranchProya Cosmetics Co., Ltd. Shanghai BranchHangzhou Proya Trade Co., Ltd.Hanna Cosmetics Co., Ltd.Anya (Huzhou) Cosmetics Co., Ltd.Yueqing Laiya Trading Co., Ltd.Huzhou UZERO Trading Co., Ltd.Mijing Siyu (Hangzhou) Cosmetics Co., Ltd.Zhejiang Meiligu Electronic Commerce Co., Ltd.Huzhou Chuangdai E-commerce Co., Ltd.Hangzhou CORRECTORS Trade Co., Ltd.Huzhou Keyan E-commerce Co., Ltd.Hapsode (Hangzhou) Cosmetics Co., Ltd.Hapsode Co., Ltd.Hong Kong Keshi Trading Co., Ltd.Hong Kong Xinghuo Industry LimitedHuzhou Hapsode Trading Co., Ltd.
Hong Kong Zhongwen Electronic Commerce Co., LimitedHong Kong Xuchen Trading LimitedHuzhou Younimi Cosmetics Co., Ltd.Ningbo TIMAGE Cosmetics Co., Ltd.Hangzhou TIMAGE Cosmetics Co., Ltd.Ningbo Keshi Trading Limited
YesYesYesYesYesYesYesYesYesYesYesYesYesYesYesYesYesYesYesYesYesYesYesYes
Japan ORNingbo Tangyu Trading Co., Ltd.Hangzhou Weiluoke Cosmetics Co., Ltd.Hangzhou Oumisi Trading Co., Ltd.
YesYesYesYes
Number
Included in This
ReportCompany Name
Proya (Hainan) Cosmetics Co., Ltd.Singuladerm (Hangzhou) Cosmetics Co., Ltd.Proya (Zhejiang) Cosmetics Co., Ltd.PROYA PTE. LTD.PROYA BEAUTY MALAYSIA SDN. BHD.PROYA PTE. LTD.PROYA BEAUTY MALAYSIA SDN. BHD.Hangzhou Luxiaotie Fitness Co., Ltd.Proya Europe SARLShanghai Zhongwen Electronic Commerce Co., Ltd.Huzhou Niuke Technology Co., Ltd.Hangzhou Wanyan Culture Media Co., Ltd.Hong Kong Wanyan Electronic Commerce Co., LimitedNingbo Proya Enterprise Consulting Management Co., Ltd.Zhejiang Qingya Culture Art Communication Co., Ltd.BOYA (Hong Kong) Investment Management Co., LimitedHangzhou Yizhuo Culture Media Co., Ltd.Xuzhou Laibo Information Technology Co., Ltd.Guangzhou Qianxi Network Technology Co., LtdHubei Proya Technology Co., Ltd.
YesYesYesYesYesNoNoNoNoNoNoNoNoNoNoNoNoNoNoNo
Appendix: Scope of the report
Zhejiang Beauty Cosmetics Co., Ltd.Yes25
125126
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Carbon Footprint Verification Result
127128
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Report Authentication Result
129130
2023 Sustainability & Environmental, Social andGovernance (ESG) Report
Report Authentication Result