1Contents
Description of the Report Preparation 01 01 02 03
To Stakeholders 03
About the Company 05 Environmental Social Responsibility for
Our Sustainability Management 13 Responsibilities Governance
Topic: Digital Intelligence Empowerment 25 Responsibilities
Accelerating the Development of New
Quality Productive Forces
Climate Change Tackling 35 Innovation-drive and Intellectual Property 71 Operation by the Board 117
Environmental Compliance 44 Safety and Quality of Products and Services 80 of Directors the Board of
Annex Management Supervisors and the General Supply Chain Security 84 Meetings of Shareholders
GRI Index 129 Pollutant Discharge and Waste 49
Treatment Support for Industry Development 89 Transparent Disclosure 121Benchmark Index to the Guidelines of the 134
Stock Exchange Energy Usage 53 Equality Inclusion and Diversity 93
Risk Management 123
List of Key Performance Indicators 135 Usage of Water Resources 56 Talent Attraction and Retention 95
Business Ethics 124
Main Participatory Domestic Associations 139 Circular Economy 61 Employee Training and Development 101
and Organizations Chemical Safety 65 Occupational Health and Safety 105
Overview of Certificates 141 Management of Raw and 68 Rural Revitalization and Social Contributions 111
Reader's Feedback 143 Packaging Materials Data Security and Customer Privacy 112
ProtectionKingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Description of the Report Preparation Terms
Unless the context otherwise requires the following words shall have the following meanings in this Report:
This is the third environmental social and governance (ESG) report issued by Kingfa Sci. & Tech. Co. Ltd. (hereinafter referred to as
"the Company" "we" or "us") intended to integrate the concept of sustainable development into corporate governance and com- Company Law means Company Law of the People's Republic of China
prehensively present our ESG practice and related performance to our stakeholders. CSRC means China Securities Regulatory Commission
Articles of Association means Articles of Association of Kingfa Sci. & Tech. Co. Ltd.The Company/we means Kingfa Sci. & Tech. Co. Ltd.Shanghai Kingfa means Shanghai Kingfa Sci.& Tech.Dvpt. Co. Ltd.Time Frame of the Report Jiangsu Kingfa means Jiangsu Kingfa Sci.&Tech. Advanced Materials Co. Ltd.Tianjin Kingfa means Tianjin Kingfa Advanced Materials Co. Ltd.This Report covers the period from January 1 2024 to December 31 2024 punished on an annual basis. To increase the compara- Guangdong Kingfa means Guangdong Kingfa Sci.& Tech. Co. Ltd.bility and integrity of this Report some content may be appropriately extended to previous and subsequent years. Wuhan Kingfa means Wuhan Kingfa Sci.& Tech. Co. Ltd.Chengdu Kingfa means Chengdu Kingfa Sci.& Tech. Advanced Materials Co. Ltd.Kingfa (USA) means KINGFA SCIENCE & TECHNOLOGY (USA) INC.Kingfa (Europe) means KINGFA SCI.&TECH. (EUROPE) GMBH.Coverage of the Report Kingfa (Malaysia) means KINGFA SCI&TECH (MALAYSIA) SDN. BHD.Kingfa (India) means KINGFA SCIENCE & TECHNOLOGY (INDIA) LIMITED
Kingfa (Vietnam) means KINGFA SCIENCE & TECHNOLOGY (VIETNAM) CO. LTD.This Report which focuses on the Company covers all branches and subsidiaries of the Company (collectively referred to as
Kingfa Biomaterials means Zhuhai Kingfa Biomaterials Co. Ltd."the Group" together with the Company). The key environmental performance indicators are mainly specific to the Company its
Zhuhai Vanteque Specialty Engineering Plastics means Zhuhai Vanteque Specialty Engineering Plastics Co. Ltd.branches and subsidiaries in China. The key social performance indicators are mainly about the Company all its branches and
Kingfa Carbon Fiber/Carbon Fiber Company means Guangzhou Kingfa Carbon Fiber Materials Development Co. Ltd.subsidiaries at home and abroad.Ningbo Kingfa means Ningbo Kingfa Advanced Materials Co. Ltd.Liaoning Kingfa means Liaoning Kingfa Sci.& Tech. Co. Ltd.National Industrial Innovation Center means National Industrial Innovation Center of Advanced Polymer Materials
Notes on Data of the Report Qingyuan Meijin means Qingyuan Meijin Advanced Material Sci.and Tech. Co. Ltd.Kingfa Environmental means Kingfa Environmental Sci.&Tech. Co. Ltd.All data and cases cited herein derive from the official documents and statistical reports of the Company and its affiliates. Unless Kingfa (Spain) means KINGFA ENVIRONMENTAL SCI.&TECH. SPAIN S.L.otherwise specified all amounts hereunder shall be denominated in RMB. Liaoning Kingfa Biomaterials means Liaoning Kingfa Biomaterials Co. Ltd.Jiangsu Kingfa Recycling means Jiangsu Kingfa Recycling Co. Ltd.Guangdong Kingfa Composites means Guangdong Kingfa Composites Co. Ltd.PP means Polypropylene
Reference Standards HDPE means High-density polyethylene
PC means Polycarbonate
This Report was prepared with reference to Guidelines No. 14 of Shanghai Stock Exchange for Self-Regulation of Listed Companies ABS means Acrylonitrile butadiene styrene
- Sustainability Report (Trial) and GRI Standards. Besides it was written in combination with the Guidelines for Self-regulation of PLA means Polylactic acid
Listed Companies on Shanghai Stock Exchange No.4 - Sustainability Development Report 2030 United Nations Sustainable De- LCP means Liquid crystal polymer
velopment Goals (SDGs) A Practical Guide to Sustainability Reporting of Listed Companies issued by China Association for Public PA means Polyamide
Companies other standards and guidelines. MBS means Methyl methacrylate-butadiene-styrene
PPA means Polyphthalamide (high temperature nylon)
PEEK means Polyetheretherketone
PCR means Post consumer recycled
COC means Copolymers of cycloolefin
Access to This Report PBS means Polybutylene succinate
PPE means Polypheylene ether
This Report may be accessed and downloaded in the official website of the Company (https://www.kingfa.com.cn/)and the web- PFAS means Per- and polyfluoroalkyl substances
site of Shanghai Stock Exchange (http://www.sse.com.cn/). This Report is provided for the readers in Chinese English and Japa- VR/AR means Virtual reality/augmented reality
nese. In case of any discrepancies among the three versions or conflicts resulting from languages the Chinese version shall prevail. RMB means Chinese Yuan
Reporting period means 2024
01 02Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
To Stakeholders
For and on behalf of the Company I would like to extend the sincerest greetings to all of you in this new year. In 2024 global cli-
mate change and sustainable development will still be grave issues. As a worldwide leader in the field of new chemical materials
the Company will actively respond to challenges and continuously promote the industry's transformation to green low-carbon
and circular economy.In 2024 the Company will continue to deepen its strategic layout in recycled plastics bio-based materials green petrochemicals
and other fields. We will focus on the applications of new chemical materials especially modified plastics special engineering
plastics and composites in new energies new infrastructure 5G communications artificial intelligence and VR/AR. We will make
technological innovations optimize production capacity structure accelerate R&D of new products and provide cost-effective ma-
terial solutions to satisfy diversified customer needs. Through in-depth cooperation with global leading customers we will achieve Optimization of Management and Practising of the ESG Concept
more breakthroughs in mass production of lightweight materials biodegradable plastics and other fields to consolidate our mar-
ket competitiveness. We have realized a systematic adjustment of our corporate governance structure by transforming our team of founders into a team
of professional managers. Besides we continuously strengthen our internal ESG training especially professional publicity and
implementation among our senior executives to ensure that the ESG concept is deeply rooted in their hearts and lay a solid foun-
Green Transformation and Promotion of a Low-carbon Future dation for our long-term development. In addition we continuously optimize our digital factory having achieved fruitful results
in increasing our production efficiency and management capabilities through intelligent means. The efforts and achievements
The Company continuously deploys its business in the upper middle and lower reaches of the industry chain for which we have
set an objective of achieving "one million tonnes in three fields". By 2030 the Company will produce 1 million tonnes of green plas- in intelligent manufacturing transformation and upgrading in the field of plastics have been fully recognized by the outside. For
tics recycle 1 million tonnes of waste plastics and manufacture 1 million tonnes of recycled plastics. In 2024 the Company pro- example Shanghai Kingfa was titled a "Service-oriented Manufacturing Demonstration Enterprise" by the Ministry of Industry and
duced 274100 tonnes of green plastics recycled 268500 tonnes of waste plastics and manufactured 348100 tonnes of recycled Information Technology and with the project named "Integrated Complete Set of Technologies for Upgrading and Recycling of
plastics. Through this series of measures we will achieve pollution and carbon reduction in the upper middle and lower reaches of Waste Plastics and Their Industrialized Applications" the Company won the "First Prize of Guangdong Provincial Science and Tech-
the industry chain and make contributions to the global green and low-carbon circular economy. nology Award". This is not only helpful for us to maintain our leading position in the path to green transition but also ensures our
more efficient and transparent operation.Global Expansion and Joint Value Creation In the context of global climate change the Company will continue to be driven by innovation and unswervingly take the path to
sustainable development with green as the background color. We believe that only by closely integrating our growth with social
In terms of globalization arrangement the Company will continue to speed up its overseas expansion and achieve the operating progress and environmental protection can we truly achieve long-term development.revenue of RMB 8.792 billion abroad in 2024. The construction of Kingfa (Vietnam) as a new factory will further deepen our coop-
eration with our major overseas customers and strike a balance between localization and internationalization of our supply chain. Finally I would like to express gratitude to all shareholders partners employees and friends from all walks of life for their trust and
Active overseas expansion has not only enhanced our global competitiveness but also created more local employment opportuni- support for us. We will continue to work hard live up to your expectations and strive for a green low-carbon and sustainable future!
ties. We have employed 581 foreign employees and promoted the sustainable development of the regional economy.In business operation we always regard product quality as the lifeline of an enterprise. Through strict quality control system we
ensure provision of high-quality reliable products for our customers. Besides we continuously improve our customer service ca-
pabilities quickly respond to customer needs and provide the customers with all-round technical support and solutions with our
customer satisfaction up to 91.30%. Chairman of the Company Chief Sustainability Officer
Talent management has always been an area that has been arousing our great concern as we have deeply realized that employees
are the most valuable assets of an enterprise. Therefore we are committed to providing our employees with a favorable work en-
vironment and career development opportunities. We help our employees grow through a sound training system and promotion
mechanism. Besides we pay attention to the health and safety of our employees and strive to create a harmonious and safe office
environment. In addition we actively participate in public welfare activities in support of education environmental protection
community development and other fields in an attempt to give back to the society.
03 04Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
About the Company
Upstream
Company Overview Green petrochemicals
Sectors of green petrochemi- Ningbo Kingfa: PP industry chain
Founded in 1993 and headquartered in Guangzhou Science City Kingfa Sci. & Tech. Co. Ltd. ("the cals and new materials Liaoning Kingfa: ABS industry chain
Company "we" or "us") "is a new material enterprise focusing on the R&D production sales and Guarantee supply chain security
services of new high-performance materials and providing brand-new material solutions for creat- Resin New materials
ing safer more comfortable and more convenient life. After more than 30 years of development the synthesis Enhance the competitiveness of
Company has set up more than 60 subsidiaries worldwide R&D and production bases in South Asia midstream business Synthesis capabilities of special engineering
North America Europe and other regions. In 2004 the Company (Stock Code: 600143) was listed on plastics fully biodegradable materials and
the Main Board of Shanghai Stock Exchange. bio-based materials
Principal Business and Important Products
Midstream
As one of the companies with the most complete product categories in the global new chemical
material industry the Company is also the world's largest manufacturer of modified plastics with
the most complete range of products. Our products are mainly based on independent innovations Modified plastics
and development including nine major categories namely modified plastics environment-friendly
high-performance recycled plastics fully biodegradable plastics special engineering plastics carbon Sectors of modified plastics General and engineering plastics solutions
fiber and composite materials light hydrocarbon and hydrogen energies polypropylene resin and and new materials All-round green comprehensive solutions
healthcare polymers These products are widely used in many industries such as automobiles house- for recycled plastics
hold appliances electronics electrical engineering communication electronics new infrastructure Provide overall material solutionsMaterial
new energies modern agriculture modern logistics rail transit aerospace high-end equipment and solutions Covering automobiles and household New materials
healthcare. We have established long-term strategic partnerships with many well-known enterprises appliances. Several fields such as elec- Solutions to special engineering plastics
at home and abroad. With excellent product performance and environmental friendliness our prod- tronics new energies and consumer
ucts are exported to more than 130 countries and regions worldwide. We provide quality services for fully biodegradable plastics and bio-based electronics
more than 1000 well-known enterprises. materials
Downstream
New materials
Sectors of new materials and Carbon fiber reinforced plastics
下 healthcare游
Leverage the advantages of polymer
Products technologies to extend downstream Healthcare
applications Super soft nitrile gloves high-grade chem-
ical protection gloves protective masks
and protective clothing etc.Diagram of Relationships between the Company's Four Major Sectors and Main Products
05 06Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Global Layout
Michigan USA Wiesbaden Germany
San Francisco Cuenca Spain
Los Angeles Tokyo
Gurgaon India
Guangzhou China
Pune India
Mexico Pondicherry India Bangkok Dong Nai Vietnam
Chennai Binh Duong
Ho Chi Minh
Kuala Lumpur Malaysia
Singapore
Changchun
Johannesburg Shenyang
Panjin Liaoning
Tianjin Airport Economic Area
Weifang Qingdao
Xinxiang
Xuzhou Jiangsu
Luoyang Nanjing
Changzhou Kunshan Jiangsu
Mianyang Sichuan Hefei Qingpu ShanghaiSuzhou
Chengdu Sichuan Wuhan Hubei WuhuHangzhou Ningbo Zhejiang
Chongqing Wenzhou
Changsha Nanchang
Headquarters of the Company
Fuzhou
Manufacturing and R&D Base of the Company Xiamen
Nanning Qingyuan Guangdong
Offices of the Company Zhuhai Guangdong Hong Kong
Danzhou Hainan
Note: This map is schematic in nature and used for an overview of a specific area only
07 08Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Corporate Culture 2004
The Company was listed on the Main Board of
Shanghai Stock Exchange.Manage-
Mission Vision Values ment Mianyang Changxin New Material Development 2015
concept
Co. Ltd. was established. Kingfa Sci. & Tech. (USA) Inc. was established.Grow together with partners share Become the world's Be value creator-oriented. Be people-oriented The Academician Workstation was established. Chengdu Kingfa Sci. & Tech. Advanced Materials Co. Ltd.achievements provide high-quality best new material en- achieve high-quality de- was established.new materials for the society and terprise highly respect- velopment and perform
create a wonderful life. ed within the industry. compliance management. 2008 KINGFA SCI. & TECH. (MALAYSIA) SDN BHD was established.Mianyang Dongfang Special Engineering Plastic
Development Strategy Co. Ltd. was acquired. 2019
In line with China's "Belt and Road" initiative and dual circulation in domestic and overseas markets the Company adheres to the Ningbo Haiyue New Material Co. Ltd. was acquired and 2009
strategic thinking of" strengthening the middle consolidating both ends being innovation-oriented and achieving leap-forward renamed "Ningbo Kingfa New Material Co. Ltd.".development" and strives to build a world-class R&D marketing manufacturing and information platform to become a worldwide Zhuhai Wango Chemical Co. Ltd. was established.leader in new materials providing support for national strategic materials. Tianjin Kingfa Advanced Materials Co. Ltd. was
established. 2020
Strengthening Expand and strengthen the polymer business; continuously expand its Hainan Kingfa Sci & Tech Co. Ltd. was established.Business the middle breadth and depth and enhance its competitiveness. In 2020 Kingfa Medical was established.development
strategy Consolidating Give full play to the pillar role of the polymer business and anti-risk capabil- 2010
both ends ity; guide the benign development in upstream and downstream business
sectors and facilitate collaboration in the whole industry chain. Jiangsu Kingfa Sci.&Tech. Advanced Materials 2021
Co. Ltd. was established.Focus of high-quality Being innovation- Guide collaboration in new technologies upselling and outward operation. Liaoning Bora New Materials Co. Ltd.sustainable development driven The Company's sales exceeded RMB 10 billion. was acquired.With the focus on the ambitious goal of achieving an output of RMB 100 Zhuhai Wango Chemical Co. Ltd. was
Core objectives of Leapfrog billion facilitate sustainable and high-quality development in four major renamed "Zhuhai Kingfa Biomaterial Co.business development development business sectors namely modified plastics new materials green petro- 2013 Ltd."
chemicalsand healthcare. Kingfa (India) was acquired.Strategic development policy Guangdong Kingfa Sci. & Tech. Co. Ltd. was
established.Development History
20032022
Liaoning Bora New Materials Co.
1993 The Postdoctoral Research Ltd. was renamed "Liaoning Kingfa Workstation was built.
The Company was established. Sci. & Tech. Co. Ltd."
KINGFA SCIENCE AND TECHNOLO-
1997 GY (JAPAN) CORPORATION LIMITED was formally established.
Guangzhou Tianhe Gaotang Pro-
duction Base was established. 2023
Kingfa Science & Technology (Viet-
nam) Co. Ltd. was established.
20142024
2001 Wuhan Kingfa Sci. & Tech. Co. Ltd. was established. The Company's Board of Directors
Shanghai Kingfa was established. Kingfa Global Innovation Training Development was re-elected. The chairman and
Center was established. management were elected.
09 10Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Important Honors
The Company National Industrial Innovation Center Ningbo Kingfa Zhuhai Vanteque Specialty Engineering Plastics
Second Prize of the First Prize of Guangdong National Key Specialized
National Scientific and Provincial Science and Refined Differentiated and Postdoctoral Research Postdoctoral Research
Technological Technology Award Innovative "Little Giant" Workstation Workstation
Advancement Award Enterprise
Kingfa Biomaterials
Guangdong Provincial Guangdong Provincial Five-star Grassroots
Standard Leading Service-oriented Manufacturing Party Organization
Enterprise Demonstration Platform
Postdoctoral Innovation
Practice Base
Provincial Quality Standard
Laboratory for Safety and Guangdong Provincial Postdoctoral 2024 Technologically
Environmental Protection of Innovation Practice Base Leading Demonstration
Plastic Materials and Products Enterprise
Guangdong Provincial Polymer Industry
Chain and Supply Chain Quality Linkage
Improvement Pilot Unit
11 12Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Our Sustainability Management
Consistently adhering to the core values of being "value creator-oriented" the Company is committed to empowering a better life
and natural ecology with high-quality products and services and insists on creating sustainable value responsibly. The Company In order to implement the sustainability concept the Company has formulated a set of comprehensive internal policies on the ESG
attaches great importance to ESG issues incorporates ESG governance into strategic decision-making and ensures the coordinat- work and disclosed some key policies on its official website to guide the management of ESG-related matters. The ESG body is re-
ed promotion of ESG goals and business growth by establishing a full-process management system covering strategic planning sponsible for monitoring the Company's compliance with the policies and procedures described below and updating the policies
execution monitoring and performance appraisal. to respond to changes in the ESG-related policies and standards.ESG Management System E S G
The Company has built an ESG architecture suitable for its own business attributes and management model created an ESG ar-
chitecture at four levels (i.e. the Board of Directors Strategy and Sustainability Committee ESG working group and ESG-related
functional departments) and appointed special ESG functional personnel to manage its ESG matters. In the ESG architecture the
division of labor rights and responsibilities are clear at all levels. The internal ESG work is managed top-down to better integrate Environment Society Governance
the ESG concept into the Company's strategic planning and promote the Company's high-quality development.Labor and Human Rights Policies
Environmental Policies of the Company Business Ethics Policies of the
of the Company Company
Board of Directors Sustainable Procurement Policies
of the Company
As the top team responsible for ESG work assume full responsibilities for the Com-
pany's ESG strategies management and external disclosure.ESG-related policies
Top Strategy and Sustainability Committee
onsib
le
respteam Incorporate ESG work into strategic planning; study the Company's medium and
long-term development strategic plans and make suggestions; carry out research
n- on the Company's sustainable development ESG and other related matters; and Governance mechanism Specific actions
cisioDe akin
g make relevant suggestions and decisions.m
Leve
l
ESG working group
t The management regularly reports the progress of
eme
n Information report-
Mana
g It is composed of the Company's senior executives heads and executives of ESG-re- sustainability-related work to the Strategy and Sustain-ing mechanism
lated functional departments. ability Committee and the Board.ion Handling daily affairs on the ESG the ESG working group supervises and manages
xecu
t
E evelL the ESG-related work of key functional departments implements ESG strategies
and specific measures and reports to the Strategy and Sustainability Committee on
Supervision Important matters related to sustainability are re-
a regular basis.procedures and viewed and approved step by step through special
measures signed reports.ESG-related functional departments
Include all functional departments and subsidiaries related to important ESG issues
of the Company.Take energy conservation emission reduction and
During the daily operation actively perform specific ESG-related work within the improvement of single-unit production capacity as
scope of responsibilities and promote the achievement of various key ESG perfor- Evaluation details evaluation indicators for relevant responsible persons;
mance indicators and goals under the guidance of the ESG working group. incorporate the ESG rating into the evaluation of the
ESG management.ESG Architecture
ESG mechanism
13 14Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Communications with the stakeholders
Extensive listening to the stakeholders' opinions is one of the important guarantees for the sustainable and healthy development
of the Company. The Company actively listens to the stakeholders' suggestions and expectations on the Company's sustainable
development and ensures effective communications with the key stakeholders through various communication channels.Government and regulatory
Shareholders and investors Customers Employees Suppliers and partners Communities and industries Media
authorities
Stable return on investment Product quality and safety Green products and designs
Responses to national strategies Transparent information disclosure
Talent attraction and retention
Customer services Climate Change TacklingProtection of employees' rights Sustainable supply chain Information disclosure and
Compliance operation Compliance operation Responsible business and marketing and interests Biodiversity and ecological dissemination
Risk management Risk management
Supplier empowerment protection
Scientific and technological innovation Employee development and Responsible business and mar-
Business ethics Intellectual property protection Privacy protection training
Transparent procurement Facilitation of the industry keting
development
Scientific and technological inno-
vation Environment and carbon management
Occupational health and safety
Public welfare donations
Regular and temporary announce-
ments Customer exchange and cooperation Employee training Environmental protection activi-
Government surveys Supplier management and
Operation by the Board of Directors Customer satisfaction surveys Working meetings audit
ties Regular and temporary infor-
Compliance inspections the Board of Supervisors and the Technical seminars Employee symposiums and
mation disclosure
Supplier training and empow- Industry conferences and exhibi-
Regular meetings and exchanges General Meetings of Shareholders democratic communications erment tions Communications and inter-Customer audit views
Participation in government coop- Performance briefing Employee engagement investi-Daily communication with customers Supplier communications
Industry-academia collaboration
eration exchanges and seminars Investor hotline gation Official accounts platform
Confidentiality of customer information Supplier conferences
Public welfare and volunteer
Company research Employee activities
activities
1516
Stakeholders Focuses and Communication expectations channelsKingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Analysis of Material Topics on ESG Issues merely of impact materiality Issues of double materiality
Innovation-driven
Materiality issues are the focuses of the Company's sustainability management identification and evaluation of ESG risks. To fully Chemical safety
understand the key concerns of the stakeholders and better integrate the demands and expectations of the stakeholders into its Safety and quality of products and services Supply chain
own sustainability management practices the Company identifies and analyzes the materiality issues identifies the database of Data security and customer Waste disposal security
Climate change tackling privacy protection
ESG issues based on the in-depth analysis of the Company's activities and business relationship background extensively solic- Employees Energy usage Circular Pollutant discharge
its opinions from various stakeholders through questionnaire surveys and ranks the issues by materiality. In the evaluation the Communications economy Anti-commercial bribery with stakeholders and anti-corruption
Company prioritizes risks that might seriously affect its business damage its reputation or arouse the greatest concern among the Facilitation of the In- Green products and designs Governance
dustry Development
stakeholders. Such prioritization enables the Company to efficiently allocate resources and formulate mitigation strategies for the
Anti-unfair Due diligence Environmental compliance management
most significant risks to better manage ESG-related matters. competition
Usage of water
resources
Understand the Equal treatment to small and Contributions to the societyUnderstand the Company's activities and business relationships. medium-sized enterprises
Company's activities
and business Understand the external objective environment. Rural revitalization
relationship Social
background Understand the key affected stakeholders. Environmental
Governance
Based on the issues identified in the Guidelines identify other potential materiality issues with Immaterial issues Issues merely of financial materiality
Database of reference to peer companies and rating standards.identified ESG
issues Identify the impacts risks and opportunities related to the issues and summarize them to form
General Impacts of Materiality Issues on the Value Chain Very material
a database of the Company's issues.Impacts of Materiality Issues on the Value Chain
Issue type Materiality issue Supply Production/chain operation Customers Employees Society
Evaluation and Identify the evaluation results that affect the materiality and financial materiality through ques-
prioritization Innovation-driventionnaires interviews and other forms.of the issues by Chemical safety
materiality Integrate the evaluation results to form a matrix for issues of double materiality.Society Supply chain security
Safety and quality of products
and services
Data security and customer
privacy protection
Materiality Confirm or adjust the results of material issues based on the opinions of the Strategy and ESG
Waste disposal
confirmation Committee. Environment Pollutant discharge
and reporting Disclose the key points in the annual ESG report according to the Guidelines. Circular economy
Governance Anti-commercial bribery and anti-corruption
Materiality Analysis Procedure Green products and designs
Environment Environmental compliance
management
Governance
During the reporting period the Company extensively solicited opinions from the stakeholders through questionnaire surveys and Governance Due diligence
comprehensively created a matrix for the current year's issues from the perspective of "financial materiality" and "impact material-
Society Employees
ity" identifying a total of 9 issues of double materiality 4 issues of financial materiality only and 4 issues of impact materiality only.Energy usage
Environment
Climate Change Tackling
Governance Communications with stake-holders
of double materiality merely of financial materiality only of impact materiality
Note: " "means the links of this value chain are impacted.
1718
Very material Materiality of economic social and
environmental impactsKingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Response to ESG Goals
In 2024 the Company joined the United Nations Global Compact (UNGC) and actively implemented the ten principles of the UNGC
based on United Nations conventions including human rights labor standards environment and anti-corruption to facilitate the
achievement of the SDGs.UN Sustainable Develop- Progress
ment Goals (SDGs) Our goals Our actions towards 2024 goals
Customer health and safety: The Company adopts advanced production technologies and a strict quality control system to ensure that all links of products from the procurement of raw materials to the delivery of finished products
From 2022 to 2030 we will continuously optimize the safety performance of our conform to safety standards. We select environmentally friendly and non-toxic raw materials to produce Achieved
products to receive no health or safety complaints from the customers. plastic products reduce the use of harmful substances and protect customer health.Occupational health and safety:
From 2022 to 2030 we will ensure annual zero work-related deaths and a cover- The Company constantly improves its health and safety management system betters its health and safety
age rate of 100% in the physical examination. management regularly organizes occupational health inspections and safety risk assessment promptly de- Achieved
From 2022 to 2030 we will ensure that the annual health and safety risk assess- tects and addresses occupational disease risks and carries out health promotion activities.ment covers 100% sites.The Company respects the employees' freedom of association and collective bargaining rights. We
Collective contracts: actively establish communication and cooperation mechanisms with our trade union encourage and
From 2022 to 2030 we will ensure that the annual coverage rate of the collective support our trade union to negotiate on an equal footing with the Company on matters such as working Achieved
contract is up to 100%. conditions remuneration benefits working hours rest and vacation on behalf of the employees and
seek mutually acceptable solutions.Career: The Company encourages and supports all employees to participate in training activities. Regardless of their positions they have the opportunity to receive training and achieve career development. Besides
Compared with 2022 the average skills training time per employee will increase the employees are regularly organized to participate in external training activities such as industry con- Achieved
by 2 hours by 2030. ferences seminars and professional training organizations to broaden their learning channels.Co verage of social insurance:
The Company provides comprehensive social insurance and housing provident fund for the employees
From 2022 to 2030 we will ensure that the annual coverage of social insurance is to firmly guarantee the health and future of the employees and their families. Achieved
100% among the employees.
Employee satisfaction: The Company conducts an employee satisfaction survey at least once a year and extensively collects the employees' opinions and suggestions on the working conditions remuneration benefits career de- In steady prog-
Achieve employee satisfaction among more than 98% of the employees in 2030. velopment etc. through questionnaires and symposiums. ress
Anti-discrimination and anti-harassment:
The Company is always fair impartial and transparent in all aspects of recruitment promotion salary
From 2022 to 2030 ensure that no discrimination or harassment occurs every training and career development. We continuously carry out publicity and education activities to pre- Achieved
year and the coverage rate of discrimination and harassment training reaches vent and stop harassment.
100%.
Energy consumption: The Company regularly conducts energy efficiency evaluation increases single-machine capacity by In steady prog-
Compared with 2022 the comprehensive energy consumption per unit of out- energy-saving renovation with advanced production technologies and processes includes energy con-
put will be reduced by 25% by 2030. servation objectives in related personnel's KPI and reduces its energy consumption.ress
In the early stage of production equipment and process design the Company gives priority to low-pol-
Air pollution: lution production equipment and raw materials to reduce the generation of pollutants. In new projects
By 2030 the emissions of air pollutants (VOCs PM SO2 NOx) per unit of output priority is given to the use of high-efficiency pollution control processes and the pollutant control fa-
in the production process will be reduced by more than 30% compared with cilities of existing projects gradually undergo iterative upgrading to improve pollution control efficiency
Achieved
2022. and reduce total pollutant emissions. Strengthen the operation and management of pollution control
facilities to ensure efficient and stable operation and emission up to standards.Wastes:
The Company is committed to converting the wastes into resources and improving the resource utiliza- In steady prog-
Establish a complete waste classification and recycling system. The recycling rate tion of the wastes through recycling and reuse. ress
of industrial waste will increase by 60% by 2030 compared with 2022.
19 20Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
UN Sustainable Develop- Progress Our goals Our actions towards ment Goals (SDGs) 2024 goals
Greenhouse gas: The Company identifies inspects and monitors greenhouse gas emissions during its operations
Compared with 2022 the greenhouse gas emissions per unit of products will be re- establishes a management and control system and continuously optimizes it. We gradually ex-
duced by at least 30% on a year-on-year basis. pand the scope of application of green energies build green parks and factories procure the inter-ested parties to practice green and low-carbon production living and office methods establish a In steady progress
Compared with 2022 achieve a 30% reduction in carbon emissions per unit related green procurement mechanism and a carbon emission management system in the supply chain
to procurement activities by 2030. and promote the realization of net-zero emission goals in the supply chain.Anti-corruption and anti-bribery: The Company resolutely opposes any forms of corruption and bribery encourages the employees to actively participate in the anti-corruption and anti-bribery work establishes an internal whis- Achieved
From 2022 to 2030 we will ensure that no corruption occurs every year. tleblowing mechanism and provides necessary protection and support for whistleblowers.Business ethics training:
From 2022 to 2030 we will achieve full coverage of business ethics training (on cor-
ruption and information security) among all our employees to ensure that our an- The Company continuously strengthens its business ethics education and training for the employ-
nual training coverage will be up to 100%. ees to improve their understanding of business ethics and enhance their self-discipline skills.Achieved
By 2030 the average business ethics training hours per employee will increase by 2
compared with 2022.Anti-fraud: The Company will establish a sound internal control system strengthen integrity education for the
From 2022 to 2030 the Company will ensure no fraud strengthen internal control employees enhance all the employees' vigilance and ability to identify frauds and ensure that all Achieved
increase the employees' awareness of integrity and risks and reduce fraud risks. business activities will be based on the cornerstones of truthfulness accuracy and compliance.Evaluation of business ethics risks:
From 2022 to 2030 ensure that the business ethics risks are evaluated and internally The Company conducts a comprehensive examination regarding the business ethics at least once
audited at least once a year to comprehensive assess the risks that the Company a year. The Audit Department evaluates and controls the business ethics risks. It is responsible for Achieved
might face in business ethics and put forward corresponding improvement mea- identifying risks of different departments and positions.sures and suggestions.Conflicts of interest: The Company enhances its employees' awareness of and alertness to the conflicts of interest
From 2022 to 2030 ensure that all employees can timely and accurately disclose through training and education and ensures that the employees can consciously abide by the Achieved
their external relationships or activities that have potential conflicts of interest with Company's policies on the conflicts of interest.the Company's business with a disclosure rate of 100%.Sustainable procurement training:
The Company regularly organizes internal training to communicate sustainable procurement re-
From 2022 to 2030 ensure that the annual sustainable procurement training cover- quirements to procurement engineers to ensure effective implementation of policies. Achieved
age of purchasing specialists reaches 100%.Supplier management:
From 2022 to 2030 ensure that the suppliers comply with labor laws and regulations The Company has issued the Sustainable Procurement Policies to regulate the procurement stan-
and annually 100% suppliers are qualified in protecting the rights and interests of dards and requirements for environmental protection laborers' human rights business ethics
laborers. etc. which shall be implemented by the Purchasing Department and supervised by the executive
From 2022 to 2030 the Company ensures that 100% of key raw materials will be from deputy general manager of the General Manager's Office. When selecting the suppliers the Com-
the suppliers with environmental management system certification (ISO 14001). pany regards compliance with labor laws and regulations and protection of labor rights and inter-
In steady progress
From 2022 to 2030 ensure that the supplier code of conduct will be 100% signed ev- ests as important access conditions includes labor rights protection clauses in the agreements
ery year. and actively procures the suppliers to pass the system certifications related to environmental and labor rights.Compared with 2022 the on-site audit coverage of core suppliers will increase to
90% by 2030.
Information security: The Company regulates and manages the collection storage and use of personal data prohibits the employees from disclosing customer information and other personal data to unauthorized
From 2022 to 2030 we will ensure that no major information security incident will third parties conducts regular information security risk assessment discovers and repairs security Achieved
occur every year guarantee the security of our business data and customer informa- vulnerabilities in time drafts emergency plans for information security incidents responds to and
tion and prevent information leakage and abuse.1 handles information security incidents in a timely manner.
1 A major information security incident was an information security incident that caused a loss of more than RMB 100000
21 22Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Sustainability Honors and Recognition
Level A Shanghai Kingfa
GoldenBee 2024 Sustainability
- Gold Medal Report of an Outstanding Listed
2024 Green and Sustainability
Company in the Greater Bay Area Contribution Awards
Wind Ecovadis GoldenBee ThinkTank syobserve.com gongyidaily.com
Climate questionnaire: Level B The 2nd Guoxin Cup: ESG ESG Excellence ESG Pioneer 60: ESG Explorer
Water security questionnaire: Level B Golden Bull Award Top 100 Awards of the Year Award - Chairman Chen Pingxu
CDP China Securities Journal HK ESG Reporting Awards (HERA) jiemian.com
The 1st ESG Golden Antelope 2024 Cailian Press Zhiyuan Award: Best Listed Company at Top 10 Green Development
Award: ESG Leading Enterprise in ESG Pioneer Award ESG Practices in 2024 Cases in 2024
Environmental Practice in 2024
Cailian Press Easy-Board Value Online Beijing News BK Economy
ShiDai Media
The 16th
nd
China Corporate Social Responsibility 2024 GoldenBee CSR · Chinese List: Sustainable Innovation The 2 Siemens Zero-Carbon
Annual Conference: Outstanding Responsible Influential · Leading Enterprise Awards & Circularity Award Pioneer Award: Empowerment
Enterprise of the Year Pioneer Excellence Award
GoldenBee ThinkTank CCIFC Siemens
Southern Weekly
23 24Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Digital Intelligence Empowerment
Topic Accelerating the Development of
New Quality Productive Forces
Informatization results
Based on the concept of "empowering high-quality sustainable development through digital transformation" the Com-
pany transforms its development mode and optimizes its business composition through digital intelligence continu- Platform selection and implementation preparation were completed The coverage of third-party malls for procurement
for the global collaborative marketing platform project. and the categories of materials on shelves were con-
ously refreshes its growth momentum deepens the collaboration among different business sectors and accelerates tinuously expanded which further improved the pro-
the development of the new quality productive forces. Zhuhai Base and Kingfa (Europe) launched the integrated produc- curement efficiency and transparent procurement.tion supply marketing and financial projects to refine the granulari-
ty of management. Through digital transformation of R&D ideological
unification and approval of the planning report were
The IT infrastructure construction of Kingfa (Vietnam) and Liaoning completed thus laying a solid foundation for the in-
Kingfa Biomaterials was completed realizing interconnection with troduction of digital technologies to comprehensively
the Group. improve R&D efficiency and product competitiveness.Preparations are being made for launching the human resource in-
During the reporting period In the field of data application a series of kanban on formatization upgrade project to get ready for the comprehensive group revenue PP price procurement analysis and
improvement of organizational control capabilities employer attrac- inventory analysis have been added to help the senior
tiveness and human service capabilities.the Company invested RMB and executives understand business information in real
Our five major bases in China have launched the electronic account- time and speed up team response.
680 million in building 1 unmanned warehouse ing file system online for operation realizing online filing of all attach-
information-based and digital 4 have been completed and put into use ments and one-stop inquiry and reducing our internal control risks.digital workshops
factories
Compared with traditional factories the and the defect rate of products Our factory in Shanghai
was evaluated as a Human Resource Informatization Upgrade Projectefficiency per capita has increased by has been reduced by
50% 40% "service-oriented manufacturing" demonstration enterprise by the In the second half of 2024 the Company launched a human resource informatization upgrade project with a view to
Ministry of Industry and Information improving the organizational control capabilities employer attractiveness human service capabilities and technical
Technology
support capabilities. Complete reorganization has made the organizational architecture more flexible positions more
standard preparation control more precise; optimized the employee employment and classification facilitated pan-
oramic management of the employees' electronic files and increased "electronic signing" efficiency; standardized
Informatization Improvement salary accounts achieved unified hierarchical control and budget control over labor costs; made services available to all employees and application scenarios more diversified which greatly improved the employees' self-service experi-
ence let them feel the Company's cultural care and made the services more expedient.The Company's informatization aims to Lateral collaboration with Vertical integration into the
build a full range of operations manage- the supply chain system enterprise management and control system
ment platforms with the focus on ERP Efficient collaboration with Business processes account- Special project for Special project for controlling Special project for
CRM SRM PPM OA etc. by building a optimization of organization and labor cost budgets and preparation optimizing the employee upstream and downstream cus- ing standards and assessment position management refinement lifecycle management
unified business support platform and tomers and suppliers system standards for achieving
unify the core business processes and company coordination
accounting standards of the branches
and subsidiaries thus promoting effi- Visual and controllable Quick response and efficient operation management system decision-making system
cient internal supply chain collabora-
tion and realizing a global collaborative Complete and integrated linkage Coordination of research produc- Special project for launching the whole Special project for data
work system that integrates production of logistics capital flow human re- tion supply and marketing costs salary accounting process online cleaning and preparation
supply and marketing. source flow and information flow
Five Core Tasks
Informatization plan
25 26Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Goals of the lean digital factories of modified products
Promotion of the Electronic Accounting File System
Unified form Production operations
The electronic accounting file project was quickly promoted on a large-scale basis after its pilot promotion in South
China in early 2024 realizing the construction of a lifecycle system from collection and sorting to archiving of 13 types
of documents in the five major production bases of modified plastics. Through end-to-end process reconstruction In combination with the complete SAP Establish a multi-level planning collabo-
100% electronic archiving of documents in seven core business chains including procure-to-pay and sell-to-collect Industry 4.0 a unified form is created ration and formula control system from for the Company's digital factories to ERP to MES/electronic process tables to
was realized and the relationships between business documents and attachments were established to realize infor- achieve information system consisten- highly integrate production resources
mation linkage. The synchronous embedding of intelligent approval control nodes promoted an increase in the effi- cy unified management and operation in the entire factory and achieve effi-
ciency of expense reimbursement by more than 38.9% and annually cut the costs of paper consumables by RMB 336 and collaborative production processes. cient resource collaboration real-time
thousand on average. accurate data and effective control over
formula confidentiality.Malls from Modification to Group-wide Workshop management Equipment interconnection
According to its strategic orientation for development the Company promoted the transformation and upgrade of Standardize and visualize the produc- Through equipment interconnection
the purchasing malls from the sector of modified products to the whole group. The project focused on the upgrade tion processes; facilitate reliable and ef- parameter monitoring and formula
of group control and ecological empowerment of the platform. In this project the mall platforms non-raw material ficient anomaly handling; and increase distribution are carried out to improve
procurement organization model and business control plan were horizontally promoted to the four major business the overall production efficiency for the quality predictability and stability
sectors. The category strategy was vertically and synchronously expanded. A general standard product database was the purpose of efficient on-site collab- and realize information perception data
created for new modified materials and a cross-sector collaborative procurement mechanism was constructed. The oration reliable quality traceability predictability and quality consistency."management" was promoted by "use". The use of non-raw material malls as carriers promoted the in-depth align- automatic color match recommenda-
ment of petrochemical and new materials with the Group's management system. 5 categories of modified materials tions and strict margin control.
15 categories of petrochemical and new materials and 2 categories of medical materials were launched in the online
malls. A Group-level procurement data asset pool was built providing full business perspective and dynamic analysis
support for strategic procurement decisions.AGV/pneumatic AGV
Arrival of raw Kingfa raw mate- Separation
materials rial warehouse section Feeding section Finished goods
Digital Transformation
Automatic Stereoscopic ware- Pellets: automatic Unpacking method: Packaging method:
unloading house/bulk storage separation automatic automatic
Anchoring the intelligent manufacturing strategy under the national "14th Five-Year Plan" the Company set 2023 as the first year of tank Powder: automatic Feeding mode: auto- Stacking method:
its digital transformation established its digital transformation strategies and goals planned the digital transformation path and separation matic automatic
adopted a two-step method at the physical manufacturing side. Firstly Digitalization 3.0 was designed and implemented for the Auxiliary materials: Centralized configura- Film winding meth-
automatic separation tion: automatic od: automatic
incremental domestic and foreign new factories and large-scale technological transformation projects. Secondly the existing do- Powder: automatic Mixing method:
mestic bases were transformed and upgraded with their Automation 2.0 upgraded to Digitalization 3.0. separation high-speed mixing/
pre-mixing
During the reporting period the Company implemented the demonstration project of a lean digital factory in the modification sec-
tor for the purpose of realizing synchronous and coordinated development of key elements such as men machines and materials Transportation method: AGV/pneumatic
through the in-depth implementation and active exploration of the project accumulating experience verifying the effectiveness
promoting the digital transformation model gradually expanding this successful model to different production bases and facto- Feature: modular design
ries and completely increasing the production and operation efficiency. We plan to realize Digitalization 3.0 for our factories of according to product
modified products by 2030 to 2035 to lay a solid foundation for intelligence. The complete upgrade of intelligent manufacturing requirements
was accelerated.Target: applicable to
90% of the Group's prod-
uct categories
New flexible material mixing solution: fully automatic offline batching system + AGV +
fully automatic unpacking device + robot
Construction Status of Lean Digital Factories in the Modification Sector
2728
Automatic unpack-
ing technology
Batch metering
Transfer by AGV
Offline material
separationKingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
During the reporting period the Company continuously developed and introduced intelligent manufacturing equipment such as
intelligent stereoscopic warehouse system automatic unpacking and feeding system automatic detection system for raw materi- Inspection Automation for Improving Inspection Efficiency and Quality
als and finished products automatic packaging system automatic transfer system and automatic spline injection molding system
in order to make factories highly automated and unmanned improve the intelligence of manufacturing processes and achieve The Company has introduced a variety of automation equipment to different links of the production process which
remarkable results in improving production efficiency and management ability as follows: significantly improves test efficiency and quality control capabilities reduces labor costs and realizes automation
and intelligence of production tests.Automatic
Adopt the intelligent stereoscopic warehouse Realize the standardization and visualization heterochro- The detection rate is high and the detection effi-
matic point ciency increases by 50% which can meet the detec-
management system and MES to realize un- of the production process. Quality inspection detection tion needs for 1 million tonnes of materials and an-
manned outbound and inbound delivery manage- can be traced with one click process inspection equipment for nually reduce the employment of 1.5 labor workers.ment in the whole process of material production personnel can be reduced by 50% and the en- raw materials
from demand to automatic delivery by AGV. tire quality process can be fully traceable. The self-developed particle density tester does not
Automatic par- require sample preparation characterized by low
ticle density cost small sample size for tests low energy con-
testing equip- sumption easy operation and increased detection
ment efficiency by 50%. It has been promoted by the
Company.Realize multi-directional monitoring of produc- Develop a complete range of production busi-
tion data visual refined margin control and the ness procedures standardize the operation of
average margin per order can be reduced by 50%. each node and reduce the employees' misop- They are used for online automatic sampling and
eration rate by 80%. Online auto- testing covering heterochromatic points density
matic detection fluidity and color differences. The monitoring fre-
equipment quency increases by 97% and the detection cycle is
shortened by 80%.Monitoring in- The detection data can be monitored online by
terface of on-
line automatic SPC in real time. The anomaly data can be alarmed
detection instantly and automatically pushed so that the sta-
equipment bility of the product processes is guaranteed.Increase production efficiency single-unit produc- Collect product-related data in the entire manu-
tion capacity of the workshop by 20% and annual facturing process; provide data support and di-
output per capita by 50%. Reduce the power con- rection for lean improvement scale expansion
sumption per unit of exteriors by 3 kWh/t. and long-term decision-making of enterprises
as well as basic data for companies to establish Automatic The whole process of machine washing mold
industry standards. injection change injection molding water shearing and molding packaging is automatically integrated controlled
equipment and traceable.Automatic 12 samples are loaded at one time and the equip-
particle color
difference ment repeats the tests as set automatically homog-
tester enizes and realizes unattended testing.
2930
Incoming materials Process Finished products
Highly automated and unmannedKingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Improved Automation of High-temperature Nylon Equipment for Reducing
Operational Safety Risks Digital Transformation Training for Enhancing Project Management Capabilities
From April to October 2024 in order to To accelerate the digital transformation of R&D the Company vigorously promotes the deep integration of the
further improve the intrinsic safety of Group's informatization work with its business and organizational changes achieves efficient collaboration and
production equipment and deepen the linkage with the help of project operations and continuously refines the programs titled Project Management
Company's digital transformation con- and Informatization Methodology. In these programs teaching and training activities are carried out for many
cept Zhuhai Vanteque Specialty Engi- business segments of the Group with a total of 9 training sessions covering 400 trainees from the Jincai Program
neering Plastics invested more than RMB backbones of the Technical Center backbones of the HR Department and other groups laying a solid foundation
4 million in carrying out an automation for the cultivation of talents for the Group's informatization. In April 2024 the Company held a training session fo-
improvement project for high-tempera- cusing on project management with a total of 90 online and offline participants. As a key link for accelerating the
ture nylon equipment. Zhuhai Vanteque digital transformation of R&D project management is of great significance for improving team efficiency and inno-
Specialty Engineering Plastics built a vation capabilities. This training program covered the core pain points of project management practical skills and
special project team to complete the applications in digital transformation. It supported the professional growth of the employees through the lectur-
automation improvement research ers' lectures trainees' questions group discussions result presentations interactive PK and other links to jointly
scheme design installation debugging promote the Company's innovation and development on the road of digital transformation.and commissioning of high-temperature Additional
nylon equipment reducing the frequen- control valves
cy of production operations from about
147 times/batch to 4 times/batch. This
automation improvement project effec-
Additional Control Valves of the Project
tively reduced the safety risks caused by
high-frequency operations and reduced
the risk of personnel's on-site exposure.Digital Project Management Transformation Training
31 320Env1ironmental
Responsibilities
As the world's leading enterprise of new chemical materials the
Company has always regarded environmental protection as the
cornerstone of its survival and development leading the industry
forward with "green low-carbon and sustainable" development
concept. Through continuous technological innovation and indus-
trial upgrading we are committed to minimizing the impacts on
the environment and protecting the blue planet while ensuring
product quality and performance in combination with scientific re-
source management and recycling.Highlighted results The total greenhouse emissions of domestic production bases (Scope 1 +
Scope 2 + Scope 3) were up to
13.9763
million tonnes of carbon dioxide
equivalents
The carbon emission intensity per unit
of domestic modified plastics (Scope
Invested more than RMB 1 + Scope 2) declined by
100 million in 27.58% compared with that
environmental protection in 2022
recycled Produced
268500 t waste 274100t green plastics
plastics
and produced The power of
348100 t 23.79 million kWh was
recycled plastics generated by PV
The water of The waste recycling and utilization
rate was up to
126708m3
was recycled/re-utilized 42%
SDGs benchmarking
33Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Climate Change Tackling Data on carbon emissions Low-carbon material solutions
In response to the national goal of "2030 Carbon Peaking and 2060 Carbon Neutrality" the Company officially launched the "green Accuracy authority and recognition of carbon Bio-based solutions: bio-resins or bio-based
low-carbon and circular" actions in 2021. The Company is committed to developing more environmentally friendly and ener- emission data based on life cycle assessment (LCA) flame retardants bio-based additives
gy-saving production processes and technologies continuously reducing carbon emissions improving energy utilization efficien- Provisioning of data on carbon emissions for the Factory certification
cy promoting clean energies optimizing energy structure and increasing the green level of products in order to achieve the goal whole series of plans
of carbon neutrality and contribute to the global response to climate change. Third-party authoritative material certification
Carbon emission data computing system with the Environmental substance certification and
capability for constant improvement declaration of conformity for the whole batch
Governance
The Company actively establishes a climate change management system joins hands with the stakeholders to establish a "car-
bon" management system verifies corporate carbon footprints according to relevant standards continuously reduces emissions
and regularly discloses the progress of carbon neutrality. In the Environmental Management Policies the Company specifies that
the Strategy and Sustainability Committee of the Board of Directors is a department that reviews the greenhouse gas governance Quality control Future planning
to coordinate and manage the Company's "carbon peaking and carbon neutrality" work. The General Manager's Office offices
branches and subsidiaries perform their respective duties to ensure the effective implementation of relevant practices and objec- Complete production strengths and process con- Gain insight into the future low-carbon de-
tives. trol of the factory velopment trend and make advance arrange-
Quality stability of PCRs GRS certification TC cer- ments for material solutions certification
Strategies tification etc. requirements etc.A complete range of control procedures and sys- Cooperate with the customers for joint devel-
The Company has established a dual-carbon strategy with Kingfa characteristics planned to reduce plastic pollution caused by its tems for production capacity and process stability opment and truly help the customers achieve
business operations while reducing carbon emissions and helped the industry chain reduce its overall emissions by 2060. For this Properties and quality stability of finished prod- the goal of carbon reduction
purpose we have drafted a detailed dual-carbon action plan and low-carbon product strategy and accelerated our R&D of more ucts; strict control monitoring system
low-carbon and environment-friendly products.Low-carbon Product Strategies
Identify inspect monitor and Select key products and check Create a full value chain to provide
manage emissions; establish a the carbon footprint of products low-carbon solutions accelerate the Impact Risk and Opportunity Management
control system and continuously according to relevant standards; overall emission reduction of the in-
optimize it; and gradually expand continuously improve and re- dustry and cooperate with the entire Based on the in-depth analysis of operating activities and business relationship backgrounds the Company proactively identifies
the application scope of green en- fine emission reduction work; industry chain to verify the carbon and manages possible impacts risks and opportunities arising from the climate change. In the future the Company plans to fur-
ergies. and regularly make them public. footprint of the product lifecycle and ther carry out more in-depth identification of climate impacts risks and opportunities to adapt to the potential impacts caused by
continuously reduce emissions. the climate change and formulate corresponding countermeasures for different types of potential risks in an attempt to achieve
comprehensive identification scientific assessment effective prevention and orderly control to ensure its sustainable operations.Potential Impacts of Climate Change on the Company
Action Strategies of the Company for "Carbon Peaking and Carbon Neutrality" Regulatory and Market demand Fluctuations in Correlation with
policy pressure transformation operating costs brand reputation
The fulfillment of global Customer demand for Extreme weather events The public pays more
carbon neutrality goals is low-carbon products has (e.g. flooding and high attention to corporate
Build green parks and Construct a green plas- Establish a green procure- Construct R&D design pro- accelerated. The policies surged and the compet- temperature) might cause climate actions. Envi-
green factories; promote tic recycling system; ment mechanism and a duction supply and service such as carbon tariffs and itiveness of traditional damage to production ronmental performance
relevant parties to prac- promote and continu- carbon emission manage- systems for green low-car- carbon allowances are high-carbon products facilities and supply chain directly affects brand
tice green production liv- ously improve it. ment system for the sup- bon reproduction contin- tightened. The enterpris- has declined. As a result disruptions and increase image and capital mar-
ing and office methods. ply chain to promote the uously improve efficiency es are facing stricter car- the enterprises have no operation and mainte- ket evaluation.realization of the emission and achieve the carbon bon emission constraints choice but to upgrade nance costs.targets of the supply chain. emission reduction target and increasing compli- their technologies and
ance costs. adjust their product mix.per unit product.
35 36Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Identification and Management of Climate Change Risks
According to the greenhouse gas emission verification results of an independent third-party organization our 2024 greenhouse
Risk type Description Response measure gas inventory included 17 sites in the headquarters and the sectors of modified plastics green petrochemicals new materials and
healthcare in China. During the reporting period the total greenhouse gas emissions of each site (Scope 1 + Scope 2 + Scope 3)
Policy risks: rising carbon prices Establish a carbon management system; accelerate were up to 13976319.80 tonnes of CO equivalents. The carbon emission intensity per unit of modified plastics (Scope 1 + Scope 2)
industry access restrictions. the R&D of low-carbon technologies and deploy ze- 2ro-carbon processes in advance. was 0.1338 tonnes of CO2 equivalents with a decrease of 27.58% compared with 2022.Transition risk
Technical risks: The iteration of clean Establish special R&D programs and develop low-car-
technologies has lagged behind. bon materials (e.g. bio-based materials and recycled Index Unit 2024plastics) in place of existing materials.Acute risks: The impacts of extreme Improve the disaster warning system optimize the Scope 1 greenhouse gas emissions Tonnes of carbon dioxide equivalent 794353.21 weather such as typhoon and rain-
storm on factory production and layout of production and supply chain and improve
logistics. emergency management.Physical risk Scope 2 greenhouse Tonnes of carbon dioxide equivalent 2083880.23
Chronic risks: Long-term rising tem- Promote the application of renewable energies (e.g. gas emissions
perature leads to the escalation of photovoltaic and hydrogen energies) to improve ener-
energy costs. gy efficiency. Scope 3 greenhouse
gas emissions Tonnes of carbon dioxide equivalent 11098086.37
Shift in customer demand: The Launch internationally certified carbon-related prod-
Market risk green procurement preference in ucts; provide the customers with low-carbon technical
downstream industries has increased. solutions. Total greenhouse gas emissions Tonnes of carbon dioxide equivalent 13976319.80
Green product innovation Carbon asset value development Notes: (1) Scope 1: Direct greenhouse gas emissions including consumption of fixed equipment necessary for production fuel consumption of means of transport production processes of raw and auxiliary materials refrigeration equipment dissipation of the factories' septic tanks
Explosive growth in the demand for Revenue opportunities brought and other activities within the business scope.low-carbon materials (including degradable by the expansion of the carbon (2) Scope 2: Indirect greenhouse gas emissions from incoming energies specifically electricity and steam provided outside the organizational
plastics and lightweight composites). trading market. boundaries.
(3) Scope 3: Other indirect greenhouse gas emissions specifically including Type 1 purchased goods and services Type 3 fuel and energy
related activities (parts not included in Scope 1 and Scope 2) Type 4 upstream transportation and distribution Type 5 wastes generated in
operations Type 6 business travel and Type 7 employee commuting.
(4) The total number of statistical sites for the carbon emission intensity per unit of modified plastics was the same as that in 2023 and 2022. In
Collaborative carbon reduction the actual layout the two sites were merged and one site was added due to business adjustments including 11 sites of the headquarters and
Circular economy in the industrial chain modified plastics (including recycled plastics). The emission data has been verified by independent third-party agencies.Commercialization potential of resource Become a key enabler in the
recycling technologies. low-carbon transformation of the supply chain. Participation in the Work Meeting for Drafting the National Standard Titled
Calculation of Carbon Emissions from Physical Recycling of Recycled Plastics
Identification and Management of Opportunities from the Climate Change
In February 2024 the Company and the National Industri-
Indicators and Targets al Innovation Center jointly undertook the team building for drafting the national standard titled Calculation of
Carbon Emissions from Physical Recycling of Recycled
Plastics and the first work meeting for standard revision.Compared with 2022 the greenhouse gas emissions per
unit of products will be reduced by at least 30% by 2022 As a core promoter the Company relied on its techno-
on a year-on-year basis. logical accumulation and industrial synergy advantages
in the field of recycled plastics to work with participating
Produce 1 million tonnes of green plastics recycle 1 experts to transform enterprise-level carbon manage-
million tonnes of waste plastics and produce 1 million ment experience into national standards. This not only
tonnes of recycled plastics by 2030. provided a unified scientific and feasible carbon account-
ing system for the industry but also procured the entire
The Company will realize complete carbon neutrality by plastics industry chain to achieve the carbon peak and Joint Photo of the Work Meeting for Drafting
2060. neutrality goals as soon as possible. the National Standard
Strategic "Carbon" Target of the Company
37 38Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Product applica- Production
tion scenarios lines/products Key cases
Carbon Footprint Verification of Kingfa Carbon Fiber Thermoplastic Honeycomb Panels
With advantages such as desirable mechanical properties low water absorp-
tion flame-retardant property air-tightness high molding efficiency insula-
Compared with metal materials thermoplastic com- Sealed coversTable 4.2 FP-PPKU-BK/FB Process Contribution Analysis tion withstand voltage environment-friendliness and recyclability they may
posite materials showed the advantages of low-carbon Process Carbon footprint/kg CO2e be molded into specific shapes.processing. During the reporting period the carbon Prepreg extruded unidirectional tapes New energy
Composite pressed laminate vehicles
fiber company performed a product carbon footprint Being light moisture-proof mold-proof and highly rigid with mild odor and Extruded PP honeycomb core Honeycomb
calculation of thermoplastic composites. With the Composite pressed PP honeycomb sandwich panel low VOCs the honeycomb panels are moldable and preferred alternatives to panels
paper honeycomb panels.lifecycle "from cradle to gate" the verification covered Table 4.3 FP-PPKU-BK/FB Inventory Data Contribution Analysis
prepreg extruded unidirectional tapes composite Inventory title Carbon footprint/kg Contribution percentage CO2e of carbon footprints/% Thermoplastic composite laminates: Which are light recyclable and flexible
pressing raw material transportation raw material Raw materials Organic boards with high strength and low thermal conductivity lay a foundation for light-
Energy consumption
input energy input waste discharge and other links. Transportation weight applications in the photovoltaic industry.The carbon footprint from each process of the thermo-
Carbon Footprint Calculation Result Sandwich boards: Show advantages such as lightweight high rigidity high
plastic honeycomb panels was analyzed. Honeycomb impact resistance resistance to high-temperature compression corrosion
panels
resistance and recyclability.Polyphenylene ether (PPE) materials: With high-temperature resistance de-
sirable dimensional stability and excellent low-temperature toughness they are
mainly used in photovoltaic connectors and junction boxes. With the shipment
Clean Technology Opportunity Product lines of of more than 2500t in 2024 the products can be applied in related components PPE
Photovoltaic with a power of more than 50GW (50t PPE is sufficient for producing 1GW power
In the context of the new era led by the "carbon peaking and carbon neutrality" objectives clean and low-carbon technologies generation modules (power: 650W) and help the customers reduce their carbon
and materials have become important driving forces for promoting the green transformation of the economy and society. The dioxide emissions by more than 79 million tonnes over a year.Company has elevated the R&D of clean technologies and green and low-carbon product manufacturing to a strategic level as im- PC: With excellent characteristics such as attractive appearance high heat
portant pillars for achieving sustainable development. Through continuous innovations the Company is committed to providing resistance sound toughness high weather resistance and halogen-free envi-
the downstream customers with green environmentally friendly low-carbon and efficient high-performance material solutions ronmental protection it is mainly used in photovoltaic inverters and energy
empowering the green upgrading of the industrial chain actively fulfilling environmental responsibilities while creating economic Product lines of storage battery casings. With the shipment of more than 100t in 2024 they can
value and contributing to the goal of carbon neutrality. PC be applied in related components with a power of more than 2GW (50t PC is
sufficient for producing 1GW power generation modules (power: 650W) and
help the customers annually reduce their carbon dioxide emissions by more
Product appli- Production than 3.16 million tonnes over a year.cation scenarios lines/products Key cases
Flame-retardant ABS: With advantages such as excellent low-temperature
Product lines of resistance strong corrosion resistance long-term weather resistance excellent
100% Recycled HDPE Bottles: Wholly recycled high-density polyethylene
Energy storage styrene welding performance and electrical breakdown resistance they are used in (HDPE) bottles are used in the packaging of daily chemical products. Com- lead-carbon energy storage battery casings.pared with the use of brand-new materials this recycling approach reduces
carbon emissions by 60%. Blue hydrogen: It has attracted much attention for its advantages of reducing
Recycled polypropylene from disposable fast food boxes: Used in fields greenhouse gas emissions and improving environmental balance. Ningbo
with high environmental requirements such as toys food and cosmetics they Propene and Kingfa has realized integrated and stable production capacity of propylene and
All aspects of Recycled have passed the challenging tests of the US FDA and obtained the no objec-
high purity high-purity hydrogen through propane dehydrogenation equipment provided
life and materials tion letter of food contact recycled PP (C-G grade).New Energy hydrogen reliable hydrogen sources for end customers and promoted the wide appli-
production Recycled materials: Processed and recycled from waste washing machines cation of blue hydrogen in different fields. In 2024 Ningbo Kingfa produced
air conditioners refrigerators and other household appliances as well as 14063t hydrogen-rich gases and purified 1799t high-purity hydrogen.products with low black speck content low VOCs desirable processing per-
formance and stable performance they can be used in household applianc-
es furnishings automobiles and other fields to provide the customers with
low-carbon solutions. During the reporting period the Company continuously strengthened the R&D of green technologies in different sectors. Relying
on the respective advantages and development characteristics of these sectors we identified and seized the opportunities in clean
Compared with the steel bottom guard plates they are featured by high strength technologies adopted advanced production technologies and processes constantly increased and scientifically deployed funds
Steel plastic
New energy composite boards impact resistance scratch resistance and low permeation which greatly improve resourced and manpower investments promoted the combination of the green technologies with products used them in mass
vehicles the protection capability and useful life of the bottom guard plates. production increased the proportion of operating revenues related to the clean technologies and empowered the green and
low-carbon transformation of the society.
39 40Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
R&D Outcomes in the Clean Technologies of Different Sectors
Modified plastics Carbon fiber materials
The Company is committed to promoting the low-carbon transformation and sustainable development of the industrial chain through
The Company focuses on replacing steel with plastics develops high-performance environmentally friendly lightweight products material innovation and systematic solutions. We integrate our internal and external resources based on the customer requirements. We
and promotes the low-carbon transformation of the automobile industry. have constructed a full lifecycle management system that covers product R&D application evaluation carbon footprint measurement
and emission reduction path planning to help customers coordinate their environmental and economic benefits.Develop materials with long takt Use green environmen- Replace steel with plastics: Use plastic mate-
time shorten their production cycle tally friendly spray-free rials in place of traditional metal materials Green travel solution: In response to the core require- Clean energy layout: Lightweight photovoltaic back-
improve the processing efficiency of materials and antibacte- which are used for designing all-plastic tail- ments for automobile lightweight and battery safety we sheet innovatively developed with recyclable thermo-
parts reduce the energy consump- rial materials with longer gates inner tailgate panels seat brackets etc. have innovatively developed a series of products such as plastic composites are used. The products are 50% light-
tion per unit of products for the service life. of automobiles and greatly reduce the carbon steel-plastic composite bottom guards and continuous er than traditional backsheets providing breakthrough
downstream customers and further emissions in the production process procur- fiber reinforced thermoplastic flame-retardant compos- support for the integrated application of flexible compo-
expand the fields of application for ing the automobile industry to be lightweight ite box covers. This solution reduces the weight by 30% nents and BIPVs. Extending the service life of modules
compared with traditional metal parts and significantly by 15% through material innovations is expected to
the products. and environmentally friendly.improves the energy efficiency. The supporting carbon approximately reduce carbon emissions by 120t per
emission accounting model can accurately quantify lifecycle of the MW photovoltaic system.the carbon reduction benefits throughout the product Cold chain logistics circulation system: Cold chain
New material segment lifecycle and promote the low-carbon transformation of lining boards continuously maintain their leading posi-
the new energy automobile industry. tion in the industry. Through structural innovations the
Innovative applications of low-altitude economy:
Special engineering plastics weight of transportation cartons has been reduced by Focus on breakthroughs in aircraft lightweight technolo- 35% and the overall supporting solution developed has
gies and develop key components such as high-strength
The Company has obtained the ISCC PIUS. The critical input raw materials include Diamine (Diaminodecane) Polyamide (PA) reduced the energy consumption of cold chain logistics blades arms and fuselages. Through structural optimi-
Glass (Glass Fiber) etc. where: by 18%. Through 100% recyclable design and low VOCs zation the weight of the entire UAV is reduced by 25%-
40% and the endurance mileage is increased by over process of the products a closed-loop system from
In connector applications using Vicnyl PA10T bio- In the application of electronic components the for- 30%. The carbon footprint of the whole product lifecycle production to recycling is constructed thus reducing
based materials in place of non-bio-based materials eign high-temperature resistant polyamide was success- is reduced by 42% compared with the aluminum alloy the VOCs emissions by more than 200 t per year and
such as PA66/6T can reduce carbon dioxide emissions by fully upgraded to Vicnyl PA10T bio-based high-tempera- solution promoting the transformation of low-altitude forming a low-carbon transportation system solution.
800t over a year. ture resistant polyamide. Besides the wall thickness was economy to a resource-saving development model.
In low-voltage electrical applications Vicnyl PA10T reduced from 1.0 mm to 0.5 mm achieving an overall 60%
bio-based materials are used in place of irradiated cross- reduction in carbon emissions by 600t over a year.linked PA66 which helps the customers save irradiation In the application of key components of robots and
cross-linking processes and reduce the production cycle robot dogs the ultra-high temperature-resistant and Healthcare
by 10%. They can help the customers reduce their car- wear-resistant PPA and PEEK developed by Zhuhai
bon emissions by 2400t per year. Vanteque Specialty Engineering Plastics have solved the In the field of healthcare the Company has developed the green technologies and products with its own characteristics from ma-
Vicnyl PA10T bio-based materials are used to replace problems on long-term usability of key components of terial R&D to product development including degradable melt-blown materials degradable gloves and degradable masks.solids with plastics. Since they demonstrate the highest key robots and robot dogs and have been widely used in
RTI (155 ° C) among high-temperature resistant polyam- the industry.ides and desirable recyclability they can annually reduce Degradable melt-blown materi- Degradable gloves: Based on the Degradable masks: PLA is used as
carbon emissions by 800t on the premise of ensuring als: Based on the advantages of previous R&D the compositions the main material. The mask body
long-term use by the customers over a year. the Company's full-range biode- of biodegradable additives have filter element ear strap nose bridge
gradable materials (e.g. PLA PBS been adjusted and optimized. The and other components that can be si-
and PBAT) completely biodegrad- introduction of new degradation multaneously degraded are prepared
Biobased degradable plastics able mask melt-blown nonwoven additives into the products can ef- through different processing methods
fabrics disposable swimming fectively increase the degradation such as melt-blowing spinning and
The Company actively implements the ESG concept promotes innovations in the bio-based materials reduces the carbon emis- pool filter elements washing ma- percentage and degradation rate injection molding to form the final de-
sions from the source facilitates the green transformation and upgrading of the petrochemical and material industries and chine wastewater filter bags and of gloves without affecting the gradable mask. Compared with ordi-
reconstructs a sustainable industrial system. Through the biological fermentation process of bio-based succinic acid the Com- air filter elements were success- protection ratings of the products nary masks the carbon emissions of
pany realizes the efficient utilization of biomass raw materials which can reduce the dependence on fossil resources and provide fully developed in 2024 through against the chemicals and drugs. biodegradable masks can be reduced
low-carbon solutions for the downstream customers. nonwoven technologies. by more than 50%.
41 42Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Environmental Compliance Management
Deploying Bio-based Industries and Exploring Low-carbon Products
The Company has deeply realized the importance of the environmental compliance management for the sustainable development of
The Company builds an integrated industry chain around bio-based materials which covers the entire process of bio- enterprises. We have formulated the Environmental Policies of the Company as a programmatic document for the Group's environmental
based cell factory development monomer preparation resin synthesis and modification application accelerating the management. Each production base/branch/subsidiary combines local environmental regulations and production practices to construct
green upgrading of traditional petrochemicals. As a core production base Liaoning Kingfa Biomaterials has realized the a differentiated environmental management system to ensure that the Company's decisions and actions are steadily implemented on the
large-scale production and export of bio-based organic acids and completed the construction of a bio-based 14-butane- correct path to sustainable development.diol production line. The bio-based succinic acid is produced by the Company with a bio-fermentation process to replace
petroleum-based resources with renewable raw materials. It shows the advantages of lower carbon footprint and bio-
based carbon content of 100%. It has been certified by the United States Department of Agriculture (USDA) and DIN-Ge- Governance and Strategies
prueft. The Company plans to cooperate with professional institutions to promote product carbon footprint accounting The Company actively responds to the environmental policies and ensures its compliance through the closed-loop management of
and provide low-carbon solutions for the industry. "monthly tracking - annual review - real-time optimization". We monthly publicize and implement the newly promulgated and implemented
policies on a group basis regularly conduct a comprehensive review of applicable environmental policies at least once a year promptly rec-
tify and optimize them continuously and steadily practice environmental management in accordance with the latest environmental laws
and regulations its own development and objectives. Ensure timely adjustment and update of the environmental policies.To strengthen the organization and management of the environmental protection work to ensure accurate implementation of such work
the Company has created an environmental management network with the general manager of the Group as the top decision-maker and
leader the heads of all centers and the general managers of subsidiaries being responsible step by step and set up environmental man-
agement departments in all its production bases to ensure effective implementation of environmental management work at all places of
business. In addition to comprehensively consolidate its environmental management responsibilities the Company has established a Sys-
tem of Responsibility for Environmental Protection to clarify all its employees' responsibilities for environmental protection and ensure that
responsibilities are assigned to all employees through an accountability mechanism. The Company and 16 of its subsidiaries have passed
ISO 14001 Environmental Management System Certification.The general manager of the Company is responsible for reviewing and approving the Company's envi-
Liaoning Kingfa Biomaterials Formally Put into Production Bio-based Succinic Acid ronmental policies objectives and plans.General Supervise the operational effectiveness of the environmental management system to ensure that the
manager Company's environmental protection strategies are consistent with its overall strategies.Comprehensively implement the environmental policies ensure the input of resources and promote
the continuous improvement of the environmental management system.The office safety and environment module is responsible for the specific formulation interpretation
and revision of the environmental policies to ensure that the policies are scientific appropriate and
operable.Office Organize internal environmental protection training to increase the employees' environmental aware-
ness and publicize the Company's environmental protection concept and achievements.Supervise and inspect the environmental protection work of all bases/business departments and sub-
sidiaries to ensure that all environmental protection measures are effectively implemented.Strictly implement the Company's environmental policies to ensure that the production and operation
activities of the bases meet environmental protection requirements.Formulate and implement energy conservation and emission reduction measures to reduce energy
Branches
subsidiaries consumption and carbon emissions and increase resource utilization efficiency.and depart- Promptly communicate the Company's environmental policies to all employees of the subsidiaries to
ments ensure the effective implementation of the policies in the subsidiaries.Formulate specific environmental protection management systems and measures according to the ac-
tual situations of the subsidiaries to ensure the realization of environmental protection goals.All employees are required to abide by the Company's environmental policies actively participate in
environmental protection activities and increase their environmental awareness.Employees Pay attention to energy conservation and emission reduction in daily work to reduce unnecessary ener-gy consumption and waste.Actively put forward suggestions for improvement of the Company's environmental protection and
make contributions to the Company's environmental protection work.Environmental Management Architecture
43 44Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Risk Management
Environ- The Company always maintains high vigilance against the occurrence of environmental pollution incidents. Therefore we have
mental Cul- formulated the Environmental Risk Investigation and Hazard Governance System and the Environmental Monitoring Management
ture of the
Company System established an environmental risk investigation mechanism in line with the production types of all production bases Environmentally friendly Environmental concept comprehensively identified the risks that are likely to cause environmental protection incidents particularly supervised the points
production policy Environmental protection is the foun-
Being green and low-carbon that are likely to cause environmental pollution environmental protection incidents and accidents according to the identification dation of sustainable development.protecting the environment and results regularly checked and inspected the operation of environmental protection equipment environmental protection man-
benefiting the society agement system management records and hazards.Joint investigation and inspection Handover check
Investigation on holidays Peer inspection
Environmental mission Environmental values
Legal compliance energy conser- Environmental vision Save resources and pro-
vation emission reduction and Build an essentially environ- mote green production Seasonal inspection and inspection Self-inspection
continual improvement mentally friendly enterprise
Professional investigation and inspection Daily investigation and inspection
Forms for investigating environmental risks
Indicators and Targets
Environmental compliance targets Fulfillment of targets
0 environmental or social responsibility incident Achieved
No wastes emitted beyond standards Achieved
100% compliance of construction projects in three
Achieved In June 2024 the Company's Qingyuan Base carried out a special major A comprehensive environmental protection inspection was conducted
environmental simultaneities environmental protection inspection and a comprehensive inspection in Liaoning Kingfa in June 2024 to comprehensively investigate the
of pollutant treatment equipment in all workshops and sewage stations pollutant treatment equipment in all workshops and sewage stations of
of the factory area. the factory area.During the reporting period In the face of environmental emergencies the Company and
its subsidiaries set up an emergency rescue headquarters for
the environmental emergencies led by its general manager
The Company invested The Company's environmental hazard and the implementation rate of the prepared and filed an Emergency Plan for Environmental
107.658 rectification rate was environmental monitoring plan was Emergencies issued an Investigation Report on Environmental RMB million 100% 100% Emergency Resources and a Risk Assessment Report on Envi-in environmental protection ronmental Emergencies continuously strengthened its emer-
gency management of environmental emergencies and strived
Without experiencing general or The Company did not receive adminis- to eliminate or minimize the environmental impacts when en-
more serious environmental emer- trative penalties from any government vironmental emergencies occurred. To this end the Company In June 2024 the Company made an on-site emergency response to a
gencies agency of environmental protection regularly organized its employees to receive emergency train-
significant leakage of propylene in the polypropylene unit I simulating
an unexpected large-area leakage on the first flange of the polypropyl-
ing and drills to ensure that they could respond to the environ- ene feeding pipeline and improving the relevant personnel's capabili-
mental emergencies properly timely and efficiently. ties of making emergency responses to the environmental incidents.
45 46Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Construction of Green Factories
The Company its branches and subsidiaries have actively carried out the construction of green factories and created a "green fac- Implemented Environmental Management Requirements and Carried out Environmental Protection Training
tory" management model. From six modules namely infrastructure management system energy and resource inputs products
environmental emissions and environmental performance they have promoted green manufacturing and sought solutions with In June 2024 the Company organized a knowledge training lecture on
both environmental and production benefits. As of the end of the reporting period the Company has passed the national green the environmental protection for middle-level and above leaders with
factory certification. Ningbo Kingfa Wuhan Kingfa Kingfa Biomaterials and Tianjin Kingfa have all been included in the list of na- the theme of "Compliance Management of Solid Wastes" at Liaoning
tional green factories. Base. The lecture mainly explained the eight red lines typical cases
The Company attaches great importance to the protection of the surroundings around its places of business. The project selection and related law enforcement matters on the solid waste law definition
factory site selection and construction of all its production projects are subjected to the impact assessment system for construc- and classification of hazardous wastes compliance management of
tion projects and the three-simultaneous system for pollution control in accordance with the Regulations on the Administration hazardous wastes and solid waste management. In combination with
of Environmental Protection in Construction Projects. These projects satisfy the national and local ecological protection require- the warning and educational films as well as typical law enforcement
ments avoid ecological protection areas and never cross the red line of ecological protection and the bottom line of environmen- cases released by Liaoning Provincial Department of Ecology and Envi-
tal quality. ronmental Protection the keys for localized supervision were analyzed
in depth and the upgrading of environmental compliance from passive Training Site
Environmental Protection Promotion and Green Office response to active governance was promoted.The Company has formulated the Environmental Protection Publicity Education and Training System. We regularly carry out envi-
ronmental protection education and training actively organize and perform various environmental protection learning activities
and practice the national environmental protection guidelines and policies with a view to increasing the employees' environ-
mental awareness improving the technical qualifications for environmental protection and preventing environmental accidents. Environmental Protection Knowledge Competition on "Green Factory Area
Besides the Company has formulated the Management Regulations for Management of Energy Consumption in Offices and Living Environmental Protection First"
advocating actions such as electricity and water conservation in the daily work implementing green office initiatives and encour-
aging its employees to participate in environmental protection. In October 2024 to increase the employees' environmental
awareness and promote the concept of green low-carbon office
Post water-saving and energy-sav- Develop an online approval system and Promptly adjust when to turn on and production the Company organized a special environmen-
ing signs to create a good atmo- an online procurement platform for of- and off the street lights and light-
sphere for energy conservation and fice supplies to encourage paperless of- ing devices according to seasonal tal protection award-winning knowledge competition at Qin-
consumption reduction. fice and avoid unnecessary paper waste. changes. gyuan Base with the theme of "Green Factory Environmental
Protection First" and provided a question base for acquiring
Use energy-efficient computers The elevators are put under group knowledge about environmental protection. The employees
printers and other equipment control and linked. Properly set
to strengthen the maintenance when to start and shut down the el-
who gave excellent answers were given cash rewards to encour-
evators based on the flow of people age them to acquire knowledge related to the environmental and management of lighting and to reduce unnecessary load-free op- protection independently. Environmental Knowledge Contest Questionnaireair-conditioning systems. erations of the elevators.When the air conditioners are in
use set temperature zoning and Strictly follow the regulations on
remind door closing. Discontinue garbage classification and dispos-
their operations during rest. al. Classify and mark garbage bins.Green Office Initiatives 2024 年世界环境日
6月5日是新修订的《中华人民共和国环境保护法》规定的环境日。日前，生态环境部正式发布2024年六五环境日主题——“全面推进美丽中国建设”。
Distribution of Knowledge Manuals on Preventing Solid Waste Pollution for 1. 附图《公民生态环境行为规范十条》宣传折页
Improving Solid Waste Management 2. 珠海市生态环境局微信和官网行政信息二维码
To help the employees understand the harm of solid wastes to the environ-
ment and health and foster correct ideas about the environmental protec-
tion in June 2024 the Company organized distribution of the "Knowledge
Manual on Preventing and Controlling Solid Waste Pollution" for publicity 微信公众号 行政检查、处罚信息公示
and training. From the perspective of front-line employees in the workshop 3.广东省生态环境保护有关信息库
production the manual concisely explains the harm of solid wastes to the
human body and environment during the production in the form of pictures
and texts as well as how to correctly classify and collect the solid wastes. The
manual was issued by the Environmental Management Department to en- 生态环境保护地方法规 企业环保问题答疑
sure that environmental protection knowledge was announced in place and 编制：安环部2024.6.4
that our employees' knowledge and capabilities of environmental protection
management were effectively improved. Knowledge Manual for Employee Learning Poster of "Ecological Environment Day"
47 48Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Pollutant Discharge and Waste Treatment
The Company has formulated the Operation Management System for Pollution Prevention and Control Facilities Responsibility
System for Environmental Pollution Prevention and Control and Management Procedure for Environmental Safety Monitoring. We RCO Technology Application Project of Guangdong Kingfa Composites
constantly improve our management mechanism for monitoring and regular inspection of the pollutants and waste discharge and
regularly entrust third-party organizations to inspect pollutant treatment facilities and discharge conditions to ensure that the dis- To satisfy the environment-friendly emission requirements
charge and disposal of various pollutants and wastes strictly comply with the local discharge standards without affecting the local and effectively reduce the VOCs emissions Guangdong Kingfa
ecological environment. Composites combined cyclone hybrid spray tower + filtration +
honeycomb activated carbon adsorption concentration + RCO".In addition the Company is committed to minimized harmless and resource-oriented management of pollutants and wastes. We Through a comprehensive waste gas collection system the
actively carry out three-waste improvement projects in our major production bases and subsidiaries to explore and tap the poten- waste gas generated at each location is concentrated prelim-
tial of waste recycling and comprehensive utilization. inarily purified by cyclone hybrid spray tower filtered for im-
purity removal and subjected to honeycomb activated carbon
Waste gas treatment adsorption and concentration to further reduce the pollutant
content. Finally after deep treatment by RCO it is discharged
The Company strictly abides by relevant laws regulations and local standards on exhaust gas emissions. Following the principle at an altitude of 21m effectively reducing the waste gas emis-
of "recycling the wastes as far as possible and collecting them by quality" we are committed to adopting the most advanced pollu- sion concentration from 18 mg/m3 to 8.6 mg/m3 effectively
tion control technologies scientifically designing exhaust gas collection systems optimizing production equipment and processes mitigating the environmental pollution of organic waste gas
ensuring efficient and stable operation of air pollutant treatment facilities and reducing unorganized emissions of pollutants. ensuring that the Company's production conforms to the envi-
The Company's exhaust emission-related performance during the reporting period is shown in the following table: ronmental protection standards and taking a solid step in the
green development process of the carbon fiber industry. RCO Equipment
Index Unit Data in 2024
Wastewater discharge intensity m3 22865427592
Recovery rate of waste gases % 32
Particulate matter (PM) Tonne 91.96 Waste Disposal
Non-methane hydrocarbon Tonne 163.54 For the solid wastes the Company strictly abides by waste-related laws regulations and disposal standards to ensure that all
Nitrogen oxides Tonne 80.72 wastes are treated harmlessly to avoid harm to the environment and human health. The Company reduces the amount of wastes
generated by optimizing production processes and improving resource utilization efficiency. We actively explore how to utilize the
Sulfur oxide Tonne 41.24 wastes as resources recycle plastic wastes as recycled plastic raw materials reduce the production demand for new plastics and
VOCs emissions Tonne 548.94 develop cooperation with professional waste recycling and treatment organizations to jointly promote the utilization of wastes as
resources. As of 2024 the Company had established a complete waste classification and recycling system and the waste recycling
rate was up to 42%.Optimizing the Outbound Pumping Process of the Reactor Liquid in the Hydrocyanic The Company's waste emission during the reporting period is shown in the following table:
Acid Removal Tower of the Acetonitrile Unit to Reduce Waste Gas Emissions
In 2024 to solve the problem that the waste liquid generated Index Unit Data in 2024
during the production of the acetonitrile unit could not be ef-
fectively utilized Liaoning Kingfa implemented measures for Reactor liquid Total waste disposal Tonne 21109.84
optimizing the waste gas process. During the production of the of acetonitrile
acetonitrile unit the Company optimized the outbound delivery dehydrocya- TK-1602 TK-1601 Disposal of hazardous wastes Tonne 10934.45
nate tower
process for effective recovery of the waste liquid. After the tech- Disposal of non-hazardous wastes Tonne 9506.58
nical transformation of the projects the wastewater incineration
amount was reduced by 19910t in 2024 saving the fuel gas by Recycling to systemAdded pipeline Disposal of high-level wastes Tonne 0
3117706.9 standard cubic meters. While cutting the costs the
technical transformation effectively reduced the exhaust gas Waste recycling rate % 42
emissions providing strong support for the Company's environ- Total amount of wastes recycled/
mental protection and economic benefits. Project Reconstruction Procedure reused Tonne 8916.94
49 50Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Non-hazardous wastes
The Company's non-hazardous wastes mainly include general industrial solid and domestic wastes. Among them the domestic
wastes are collected disposed of and handed over to a municipal sanitation department for disposal. For general industrial solid Promoting Hazardous Waste Minimization and Performing Comprehensive Management
wastes the Company and its subsidiaries have prepared policy documents such as Solid Waste Management Regulations General
Solid Waste Management System and Solid Waste Packaging Specifications to standardize the management of industrial solid In 2024 Liaoning Kingfa comprehensively managed hazardous waste minimization optimized and improved the Company's hazardous waste disposal in three dimensions namely source reduction process control and end-of-
wastes which are not hazardous. The Company scientifically and efficiently recycles the non-hazardous wastes with value for recy- pipe treatment and achieved desirable results.cling. For those that really cannot be internally recycled the Company strictly screens and entrusts a third-party professional or-
ganization with corresponding qualifications for safe and standardized disposal. During the disposal some general industrial solid Source reduction
wastes are appropriately delivered to thermal power stations and advanced energy conversion technologies are used for power
generation realizing the transformation from wastes to energies. Change the waste discharge index of the process card of the upstream production equipment explore the control
scope more suitable for production strengthen management and reduce the generation of source pollutants and
discharge to the downstream."Turn wastes into treasure" for example the self-built equipment in the condensation unit of ABS production equip-
Identify and judge that industrial solid wastes are not included in the National Catalogue ment recovers more than 60% of particulate matter in the condensation wastewater realizes resource utilization
Identification of Hazardous Wastes or other standards for identifying hazardous wastes and are not haz- and reduces the generation of downstream hazardous wastes.and judgment ardous.Process screening
After their generation the general industrial solid wastes shall be collected by categories Perform classification and screening. Strictly plan the classified management of solid wastes train and assess all
handed over to relevant departments for unified warehousing and storage. Graphic envi- production equipment and units and prevent mixed storage and discharge of solid wastes.ronmental protection signs shall be set up.The resource-oriented recycling follows the principle below: Reduce sources before resource-oriented utilization
Collection The storage places shall be equipped with the facilities or measures for protection against and ultimately perform harmless disposal. Give priority to recycling valuable solid wastes including recycling waste
and storage rain leakage scattering and loss. The hazardous and domestic wastes are prohibited from timber preparing waste acid and alkali solution for wastewater treatment and recycling raw and auxiliary materials.delivery into the these storage locations.Abandon backward technologies and consider green emission reduction and resource utilization in new projects.For example the dry catalytic oxidation adsorption process is used to replace the traditional activated carbon ad-
Harmless disposal measures are required for the disposal of general industrial solid sorption process for the absorption of exhaust gases containing VOCs in a hazardous wastes warehouse to improve
wastes. the efficiency and reduce the generation of hazardous wastes. A reduction and treatment project is also initiated for
The generation and storage conditions must be strictly recorded regularly reported and sludge and scum to modify the dehydration procedures and reduce the water content from 85% to 30%. The project
Disposal and entered into the system. is expected to be put into use in the second half of 2025.transfer Relevant units and third party disposal organizations must be qualified and draft emer-
gency plans for environmental incidents. End-of-pipe treatment
Disposal Procedures for General Industrial Solid Wastes In early 2024 a large-scale survey and screening was performed for the hazardous waste terminal treatment teams
which were selected from various aspects to ensure that the transfer and disposal of the hazardous wastes were le-
Hazardous Wastes gal and compliant.Measures for Reducing Hazardous Wastes
The Company has prepared the Hazardous Waste Management System to standardize the classification collection storage trans-
fer and production of the hazardous wastes included in the National Catalogue of Hazardous Wastes. For the hazardous wastes
generated during the production the Company strictly obeys the regulations and entrusts external third-party organizations with
professional qualifications for properly disposing of the wastes. The steam generated after incineration of some hazardous wastes
is recycled by a third party for secondary value conversion of resources. Replacement of Old Machines for Improving the Transformation Results of Sludge
Treatment Technologies
Identification and Collection and storage Transfer and judgment transportation
In November 2024 to satisfy the sludge treatment needs after the output in-
Identify the hazardous When collecting the hazardous wastes necessary collection When transferred internally creased that year and the 6000-tonne polyaromatic ether sulfone workshop was
wastes based on the tools packaging and temporary storage facilities shall be the hazardous wastes shall be put into operation and the inherent defects of the original plate and frame filter
corresponding identifica- equipped. The collection sites shall be close to the opera- packaged in good containers
tion standards including tion areas and shall not affect or hinder the safe passage. or packages to prevent leak- presses Zhuhai Vanteque Specialty Engineering Plastics carried out technical 3
the National Catalogue transformation of the special plastics sewage stations. The original two 25m In the process of hazardous waste collection storage and age and pollution.of Hazardous Wastes management appropriate labor protection articles occu- Declarations should be small plate and frame filters were removed. A 100m
3 plate and frame filter press
Technical Specifications pational hazard notification card machines other signs and made on the environmental equipped with a sludge unloading bucket was added. Supporting sludge pumps
for Identification of protective equipment shall be equipped. supervision platform and sludge pipelines valves etc. were installed. The technological transformation can-
Hazardous Wastes and hazardous waste labels shall not only satisfy the sludge treatment needs after the output increase in the next
Identification Standards Centralized storage facilities or places for hazardous wastes
for Hazardous Wastes. De- shall be equipped with safety facilities or equipment
be printed in accordance with three years the 6000t polyaromatic ether sulfone workshop is put into operation
termine their types and according to the types and hazard characteristics of the haz-
the regulations. but also increases the treatment efficiency of the sludge filter presses reduces the
manage them by type. ardous wastes stored. Examine hazardous waste labor intensity and effectively settles the enterprises' difficulties in waste disposal. New Plate and Frame Filter Press
The storage plans and facilities shall be safe reasonable disposal units to ensure that
and feasible. they are qualified.
51 Hazardous Waste Disposal Procedure 52Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Improvement of the single-unit production capacity of two-stage machines: By optimizing the screw combination
of the main machine and adjusting the screw size of the sub-machine the single-unit production capacity was approx-
imately increased by 2000 t/unit/year and the power consumption per unit of output was nearly reduced by 30 kWh/t.Improvement of the HDPE twin-screw process: Two tensile screws were used in place of shear blocks which re-
duced the shear strength improved the plasticization capacity and reduced the power consumption per unit of output
by 11.6%.Kingfa Process improvement for the drying system: On the premise of ensuring that the product smell was acceptable the
Environmental drying and heating time was shortened. The cooling time was prolonged and the power consumption was reduced.Energy Usage The energy consumption was approximately cut by 10%.Research and use of meshless filter: The machine was transformed into a dual-filter production mode of continuous
filter + melt pump. The power consumption per unit of output was reduced by 13% (with an average decrease of 40
kWh/t) and the production capacity was higher.Transformation of the air compressor system: The fixed-frequency air compressor was replaced with a permanent
Committed to the continuous optimization of energy consumption the Company increases its energy utilization efficiency and re- magnet variable frequency air compressor and the electrical conversion ratio declined. It saved electricity of 376500
duces the total energy consumption with advanced energy-saving technologies and equipment. We have prepared more than ten kWh and electricity bills of RMB 199500.institutional documents such as the Energy Management Manual set clear energy consumption reduction targets evaluated and
adjusted them year by year to continuously improve the energy management system.Energy-saving motor transformation: Use a 200kW permanent magnet energy-saving 6-level motor to replace a
250kW 4-level ordinary motor reducing electric energy consumption per unit by 45%.
Energy substitution: Steam energy was used to replace electric energy and energy consumption costs were reduced
Kingfa by 15% per unit.The Company's energy-related performance during the reporting period is shown in the following table: Biomaterials Optimization of the distillation unit: Using the coupling process and advanced trap the steam energy consumption
per unit was reduced by 18%.Improvement of the heating method: Electromagnetic heating replaced resistance heating and electrical energy
Index Unit Data in 2024 consumption per unit was reduced by 12%.Direct energy consumption Tonne of standard coal 334812.3
Natural gas m3 134482393 Comprehensive production improvement and energy-saving transformation: A number of measures such as
debottlenecking and exhaust gas deethanization were implemented. The whole plant's commodity quantity was
Diesel Tonne 300.06 increased and the natural gas consumption was decreased. Previous steam purchase was changed into sales and the
comprehensive energy consumption per unit throughout the year was 323.6 kg oil equivalent/tonne with a year-on-
Coal water slurry Tonne 275920.61 year decrease of 28.2%.Steam optimization of the whole field: After the debottlenecking of the integrated acrylonitrile unit the production
Indirect energy consumption Tonne of standard coal 616907 capacity and the amount of by-product steam increased. The combination with a number of technical transformations
ensured the continuous return of steam. In 2024 the purchased steam decreased by 340 thousand tonnes and the return
Purchased electricity '0000 kWh 287800 Liaoning steam increased by 110 thousand tonnes saving about RMB 104 million in purchases and about RMB 18 million in sales.Kingfa
Improvement of boiler water quality: Optimized the boiler water treatment chemicals refined the control over water
Medium-pressure steam Tonne 1987963.87 quality indicators and increased the resource utilization efficiency. The volume of sewage discharge from the whole
factory's steam drums was approximately 7t/h and the consumption of desalinated water declined by 7t/h. The steam
Low-pressure steam Tonne 380380.31 output dropped by 7t/h and the steam output increased by 3t/h. The costs were approximately cut by RMB 5 million.PV power generation (self gen- Optimization of the heating and tracing system: Increase monitoring of return water in the main water units opti-
eration for self use) '0000 kWh 2379 mize hydraulic balance and reduce water supply temperature. The consumption of low-pressure steam for heat tracing decreased by 5.5 t/hour on a year-on-year basis. The heating period was calculated as 153 days saving about RMB 3.03
Total energy consumption (in- million.cluding PV power generation) Tonnes of standard coal 951719.2
Energy-saving transformation of air compressors: The low-pressure drop check valve was alternatively used for
the regenerative air compressor of the propane dehydrogenation unit. Calculated based on 8000 hours per year the
Ningbo electricity consumption could be cut by about 880000 kW/year equivalent to about 260 tonnes of standard coal/year.Energy-saving Technological Transformation Practice Kingfa Heat exchanger replacement: Both the separation tower condenser of the propane dehydrogenation unit and the product gas No. 1 chiller were high-efficiency energy-saving heat exchangers which could approximately save the stan-
dard coal by 9907 tonnes in total.Having established a complete energy efficiency evaluation mechanism the Company regularly carries out professional in-depth
assessment work. Through comprehensive monitoring and analysis of the energy use process we accurately identify what need to
be optimized and adopt pertinent improvement measures to ensure the continuous improvement of energy efficiency realize effi- Replacement of the low-power heating rod: The theoretical power was reduced by 18 kW/unit and the temperature
cient energy utilization and maximize the value of resources. Guangdong was kept stable within ± 10 ℃ .Kingfa
Composites Addition of heat insulation cotton to the extruder: The average temperature was lowered by about 18 ℃ which During the reporting period the Company's subsidiaries and production bases actively carried out energy-saving technological reduced heat loss and energy consumption.transformation practices and achieved a series of favorable results.Energy Conservation Measures for Different Sectors (Partial)
53 54Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Clean Energy Utilization Usage of Water Resources
The Company adheres to the concept of green development continuously optimizes the energy structure actively explores and
vigorously applies clean energies such as solar energy and wind energy promotes its substitution of traditional fossil energy con- The Company strictly abides by the national Water Pollution Prevention and Control Law Water Resources Management Regula-
stantly increases the proportion of clean energy to total energy consumption and gradually constructs a green low-carbon sus- tions other laws and regulations. While guaranteeing the ecological safety of water sources in compliance with the regulations it
tainable energy system. achieves intensive and efficient utilization of the water resources continuously fulfilling its corporate responsibility for green pro-
duction and sustainable development.As of the end of the reporting period Governance
Our rooftop photovoltaic installed and the capacity under In 2024 photovoltaic power The Company's water resources management exhibits a three-level collaborative governance structure with the general manager
capacity reached construction was generation was up to as the main person in charge who is responsible for coordinating overall strategies determining water resources management
objectives and supervising the implementation of the policies. The Strategy and Sustainable Development Committee at the su-
24300 38400 23.79 pervisory level focuses on target decomposition and process control reviews management plans promotes cross-departmental kW kW million kWh collaboration and optimization and drives innovation and development of water resources management. The executive level re-
lies on the process equipment department branch factory directors and full-time factory engineers to draft and implement water
resources management plans perform technological transformation for the water conservation organize daily data monitoring
and equipment maintenance and embed water-saving measures into the entire production process through refined operations
In Response to the Call for Green Development Liaoning Kingfa Biomaterials forming a closed-loop management system from the strategic planning to the on-site operation and from the target formulation to
Purchased Green Electricity the data traceability.To further deepen the carbon reduction practices Liaoning Kingfa Biomaterials Strategies
actively promotes green electricity substitution in the bio-based monomer produc-
tion. In 2024 the proportion of green electricity used in Liaoning Production Bases Committed to the efficient utilization and protection of water resources the Company increases the reuse rate of water resources
reached 60% and the cumulative purchase of green electricity throughout the year by utilizing water conservation technologies optimizing production processes and building sewage treatment and reclaimed wa-
exceeded 8.49 million kWh. With the release of production capacity it is expected ter recycling facilities. Besides we optimize our water circulation system install water conservation devices and employ advanced
that the monthly consumption of green electricity would increase to 3 million kWh wastewater treatment technologies to ensure the maximization of the water resources. The Company strictly abides by the man-
after full production (33 million kWh per year). Through the large-scale application agement and control quality requirements for water use water reuse and sewage discharge etc. We reasonably regulate our use of
of renewable energies production carbon emissions were significantly reduced and the water resources in daily operations set annual water resources management goals and indicators based on our previous year's
contributions were made to achieving the goal of carbon neutrality. water resource consumption our operation and development strategies and draft pertinent water conservation proposals for the
factories in different places of business.Green Electricity Certifi-
cate Transaction Voucher Risk Management
The Company has built a proactive prevention and control model for "data-driven warning - hierarchical hazard management -
rapid emergency response - dynamic enhancement of capabilities" to effectively respond to water resource risks.Perform regular patrol inspections and equipment inspections to identify and resolve the potential risks in time.Perform risk assessment and analysis for water use; take corresponding management measures
for different levels of risks.Establish a system for monitoring water consumption and water quality in real time; find the
anomalies and potential risks in water use through data analysis.Establish an emergency response mechanism for water safety to ensure rapid and effective re-
sponses to water accidents.Regularly conduct training on the safety of water use to increase our employees' awareness of water risks
PV Construction of the Company and their ability to deal with the risks.
55 56Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Conservation of Water Resources
The Company continuously improves its water resource management system draws up elaborate water resource utilization plans Used MVR Evaporators and Recycled Steam Condensate
clarifies water consumption indicators and targets of all departments promotes the use of water conservation equipment and
reduces the water consumption. In addition we have established an incentive mechanism for water conservation to encourage all Liaoning Kingfa Biomaterials used the mechanical vapor recompression
employees to participate in water conservation activities and enhance the employees' awareness and skills of water conservation. (MVR) technology for production. The secondary steam generated by
evaporation was pressurized and heated through a compressor before
The Company's data on its utilization of water resources during the reporting period is shown in the following table: circulation as a heat source for efficient reuse of heat energy thus reduc-
ing the energy consumption by 50%-70% compared with the traditional
Index Unit Data in 2024 evaporation process. Under the current production load the amount of
condensate from evaporation was 1100m3 per day. All the condensate
Total water consumption Tonne 14947896.89 was reused in the fermentation and purification processes. It is estimat-
ed that the daily recovery capacity of the device would reach 2750m3 af-
Total water consumption intensity t/RMB'0000 2.55 ter full production (annually saved 907500t) and technological innova-
Purchased municipal water Tonne 12561236.89 tion drove production water conservation and efficiency improvement. MVR Evaporator
Desalted water Tonne 2333191
Groundwater Tonne 53469
Recycled/reused water volume m3 126708 Wastewater Treatment
Nowadays when environmental protection is receiving increasing attention the Company regards wastewater treatment as a key
link in the green development. The Company's wastewater pollutants mainly include suspended solids ammonia nitrogen total
nitrogen total phosphorus etc. Through a series of effective treatment measures while ensuring that wastewater pollutants are
Carried out Water Conservation Renovation in discharged up to standard we have explored how to use wastewater as resources and minimize wastewater where desirable out-
Workshops to Promote the Recycling of Process Water comes have been achieved.In 2024 Kingfa Medical transformed its water conservation process The Company's performance related to the wastewater discharge during the reporting period is shown in the following table:
in the A611 workshop and established a layered reuse system based
on the water characteristics of the production line: By introducing the
water overflown from the upper tank to replenish the middle process Index Unit Data in 2024
section and the water discharged from the middle layer into the bot-
tom cleaning process and accurately calibrating the water use stan- Total wastewater discharge Tonne 4760944.73
dards for all cleaning units and recycling the water discharged from Where: Total volume of industrial
the processes a water conservation mode of "gradient use - closed- wastewater Tonne 4282130.43
loop cycle" was created. After the transformation the average daily
displacement of the workshop dropped from 2560m3 in the second Where: Total volume of domestic Tonne 478814.3
quarter to 1900m3 in the fourth quarter (with a decrease of 25.7%) wastewater
and the annual single-line water consumption of products dropped Recovery rate of wastewater % 16.42
by 7.5% on a year-on-year thus realizing the collaborative optimiza-
tion of process water efficiency and resource recycling.Chemical oxygen demand (COD) Tonne 379.97
Five-day BOD (BOD5) Tonne 41.95
Suspended matter Tonne 31.45
Ammonia nitrogen Tonne 31.95
Reclaimed Water Diversion and Use Points Ningbo Kingfa was recognized as a provin- Total phosphorus Tonne 3.88
cial water-saving enterprise
57 58Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Kingfa Medical Sewage System Renovation Project Ningbo Kingfa Reclaimed Water Reuse System
To strengthen its sewage treatment capability since 2023 Kingfa Medical has carried out the upgrading and renova- In January 2024 Ningbo Kingfa constructed a
tion of Sewage Treatment System 151 with a view to increasing the physical chemical and biochemical treatment ef- new 200m3/h reclaimed water reuse system
ficiency and reducing the total volume of pollutants discharged. After a series of modifications the system was com- which used high-density + ultrafiltration + re-
pleted and put into regular operation in April 2024. Before the transformation Treatment System 151 could achieve verse osmosis process for treating and recover-
deep denitrification to meet the emission standards only with the support of System 155. Now it can independently ing industrial wastewater for reuse as makeup
meet the standards. Among them the daily removal of total nitrogen - the main pollutant in sewage increased sig- water in the circulating and cooling water
nificantly from 130kg to 275kg laying a solid foundation for the Company's subsequent sewage treatment after the systems. The recovery rate of the ultrafiltration
expansion of production capacity. system within the system reached 92% or above.The recovery rate of water from reverse osmosis
For the physical and chemical treatment sys-
tem of the original System 151 the air flota- Contact Oxidation Tank 1 was changed into was at least 60% and the average desalination
tion process was changed into inclined tube an anoxic aeration tank to increase the de- rate exceeded 98.6%. During the reporting pe-
sedimentation to improve the physical and nitrification capacity of the system. riod the wastewater discharge was reduced by
chemical mud removal effectiveness. 338000 tonnes in total and wastewater treat-
ment costs were cut by RMB 1.75 million. Ningbo Kingfa Reclaimed Water Reuse System
The original physicochemical flocculation ad- For Contact Oxidation Tank 2 the aeration
justment system was changed from manual to system was changed from tubular type to disc
automatic to improve the system's stability. type to improve the biochemical denitrifica-tion capacity.The anoxic tank was upgraded and trans- Capacity Expansion and Technical Transformation of the Wastewater treatment
formed. The aeration system was changed An ab aeration pipeline was added to the System by Zhuhai Vanteque Specialty Engineering Plastics
from tubular type to disc type to improve the microbial culture tank to increase biological
biochemical denitrification capacity. activity and sludge concentration. After the 6000-tonne polyaromatic ether sul-
fone workshop of Zhuhai Vanteque Specialty
Engineering Plastics was put into operation
the wastewater volume daily increased by 300-
500m3 and the original sewage treatment sys-
High-COD Wastewater Recycling Project of Liaoning Kingfa Biomaterials tem could not treat the wastewater from the
whole factory's production. For this purpose the
Liaoning Kingfa Biomaterials actively explored how to recycle high-COD wastewater. High-COD wastewater came Company carried out a series of technological
from the concentrated residues after filtration of fermentation broth which was rich in organic matters such as bac- wastewater transformations including five new
teria and protein. The content of COD was as high as 150000-200000 mg/L. Liaoning Kingfa Biomaterials used high- measures namely adding accident tank polyar-
COD wastewater for producing the biogas through anaerobic fermentation and the biogas was burned by a biogas omatic ether sulfone transfer tank polyaromatic
boiler to produce steam which was reused in the production steam system. It was estimated that after the device ether sulfone pretreatment equipment (air flota-
was operated at full capacity the annual steam output was up to 16500t. This innovative measure not only success- tion tank) nylon incoming water pretreatment
fully realized the utilization of the wastes as resources and cut production costs but also alleviated the potential sedimentation tank and technically transformed
harm of high-concentration sewage discharge to the environment built a green bridge between enterprise produc- mixed monitoring tank to improve the wastewa-
tion and ecological protection and provided a valuable reference example for the sustainable development of the ter treatment capacity and ensure wastewater
industry. discharge in compliance with the regulations. Nylon Incoming Water Pretreatment Sedimentation Tank
5960
Renovation MeasuresKingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Circular Economy External Circular Cooperation
The Company has put forward an integrated and comprehensive solution for "making the best use of plastics". Through an effective
The Company is committed to constructing a resource recycling system throughout the product lifecycle and continuously improv- recycling mechanism we increase the recycling rate of plastic products produced reduce resource waste promote the recycling of
ing the resource utilization efficiency. Internally we have actively established a resource recycling mechanism within the scope of plastic products transform them into new plastic products or other valuable resources supply environmentally friendly high-quali-
production to reuse wastewater waste gases wastes and leftover materials as resources. Externally relying on technological inno- ty recycled plastics for packaging automobiles IT electronics electrical appliances furnishing electrical appliances electric tools
vations in recycling the waste plastics we will promote the high-quality development of the circular economy and provide strong construction energies express delivery and other industries and accelerate the green and low-carbon recycling transformation of
support for the green transformation of the industrial chain. the whole plastic industry chain. Since 2004 the Company has been engaged in the recycling and high-quality utilization of waste
plastics and gradually constructed a circular complete and closed technical recycling system for the whole process of the carbon
emission reduction system that covers intelligent identification automatic sorting green cleaning product lifecycle classification
Objectives of circular economy Progress of the objectives cascade recycling and high-quality utilization of the waste plastics.The Company domestically built two production bases of recycled plastics including Qingyuan Base and Pizhou Base which are
By 2030 the Company will In 2024 the Company situated in South and North China respectively. We have built factories with a total area of 0.3 million square meters 6 production
workshops of high-performance recycled modified plastics more than 60 highly standard production lines and 6 production work-
produce 1 million tonnes of green plastics produced 274100 tonnes of green plastics shops for pretreatment of waste plastics with a high-quality treatment capacity of 150 thousand tonnes of various waste plastics
recycle 1 million tonnes of waste plastics recycled 268500 tonnes of waste plastics and an annual production capacity of more than 500000 tonnes of recycled plastics. The Company has created a refined recycling
system developed more than 500 suppliers of high-quality recycled plastics built more than 60 resource recycling outlets and
manufacture 1 million tonnes of recycled plastics manufactured 348100 tonnes of recycled plastics constructed a multi-scenario and multi-channel plastic waste recycling network for industries agriculture life oceans and other
scenarios.Note: Green plastics is a collective term for fully biodegradable plastics and bio-based materials.Recycled plastics
Repeated use
Fossil raw Production of fos-
materials sil-based plastics
Consumption
Biological raw Production of bio-
materials based plastics
Repeated use
Bioplastics Sorting
The Company's Circular Economy Solution for Plastics - an Integrated Comprehensive Solution for "Making the Best Use of Plastics"
6162
Landfill Incineration Leak in environment
Recycling
Sorting
Cleaning and
crushing
Hazard-free
treatment
Odor and impurity Manufacturing of
removal finished products
Modified pelletizing
Two major focusesKingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Internal Recycling
Visualization of High-quality Utilization of Recycled Materials
During its active response to the call for the development of circular economy and vigorous promotion of sustainable develop-
The Company innovatively developed a technology for visualizing the high-quality utilization of recycled materials
ment the Company does not only actively strengthen external cooperation deeply participate in the field of waste plastic recy-
thus breaking through the bottlenecks in recycling light-colored plastics caused by low-temperature resistance
cling and join hands with all partners to construct a waste plastic recycling system which effectively promotes the vigorous de-
and uneven particle size of organic spotted materials. This technology introduced inorganic/bio-based spots ac-
velopment of the circular economy but also makes continuous efforts in the internal production process. By adopting advanced
curately controlling heterochromatic spots and fiber defects and achieving a carbon emission reduction efficiency
technologies and processes we realize the efficient reuse of wastewater waste gas waste and leftover materials as resources and
of 21.6%. Besides this technology separates spots through physical filtration during recycling and produces rela-
convert various materials that might have caused environmental burden into resources that may be re-put into production or have
tively pure PCR. Being in line with the 3R principle of circular economy it is conducive to creating a virtuous circle
other value thus maximizing the utilization of resources and effectively reducing the negative impacts of the production on the en-
of economic benefits promotes the development of the plastic recycling industry and reduces resource consump-
vironment.tion. Remarkable results have been achieved in reducing the carbon emissions.PIR Recovery Plan for Promoting Recycling Scrapped Automotive Lamps
Assisting the Partners in Building "Zero Waste Factories"
The Company carried out in-depth cooperation with leading automotive lamp companies within the industry and
Relying on a professional and complete waste plastic full-chain recycling and processing system Kingfa Envi- successfully constructed a closed-loop recycling system of "scrapped automotive lamps - dismantling and crush-
ronmental provided a petrochemical company with a closed-loop solution covering waste sorting transfer and ing - Kingfa modification - automotive lamp manufacturers - PIR (post-industrial recycled)" to realize recycling in
recycling. The warehouse pretreatment system realized efficient sorting crushing cleaning modification and the factory. This system reapplied the recycled materials in manufacturing automotive lamps through efficient
high-quality processing of the waste plastics forming recycled particles and environmentally friendly materials dismantling and modification technologies. Its PIR solution not only fully met the performance test requirements
suitable for daily chemicals cables household appliances automobiles and other fields. This solution deeply for automotive lamp parts but also contributed to a significant reduction in carbon emissions in the production
integrated the customers' new material resources jointly developed comprehensive application scenarios of PCR/ process by about 33%. The results set a benchmark for the circular economy model of the auto parts industry.PIR simultaneously provided carbon emission accounting and zero waste factory construction support and pro-
moted the increase in the resource utilization rate of production wastes and the coordinated development of the
low-carbon industrial chain.Full-chain Recycling Solution
Partnership R&D of PLA Online Recycling Technology for Promoting Recycling of the
Nonconforming Products
Powder and Mobile turnover Internal temporary Qingyuan pretreatment High-quali- Daily Wires and
particle materials carts parking area workshop ty recycled chemicals cables
plastics In 2024 Kingfa Biomaterials innovatively developed PLA online recycling technology to effectively recycle and re-
Logistics Vehicle Household
Bulk materials Ton bags vehicles accessories appliances use the nonconforming PLA resin products produced in the production process reducing the accumulation of PLA
Modification workshop
Plastic turnover External transit wastes from the sources. This not only alleviated the environmental pressure caused by waste treatment but also Waste warehouse (New Exxon materials
packages box under the may be added) Turnoverforklift simultaneously reduced the raw material consumption and manufacturing costs achieving both economic and May coop-
Wastes Containers Transportation Waste treatment
erate with
Exxon High-value environmental benefits.process and recycling applications
Kingfa Environmental Closed-loop use
Recycling of Leftover Materials and Bags
Construction of a Waste Plastic Recycling Plant in Kingfa (Spain) Kingfa Biomaterials carried out recycling actions for raw and auxiliary material packaging bags materials falling off
Kingfa Environmental built a waste plastic recycling factory in Spain to implement a localized model of the circular machines and crushed materials. Through the recycling process and reuse mechanism the cumulative recycling
economy. The project utilized integrated sorting cleaning and high-quality recycling technologies to convert the quantity reached 752 tonnes in 2024 greatly reducing Kingfa Biomaterials' demand for new raw materials and
waste plastics into high value-added environmentally friendly materials and re-inject them into the local produc- saving RMB 6.7 million in raw material procurement costs. While cutting the production costs it also reduced the
tion and living chain. The early annual production capacity of the factory was up to 10000 tonnes (which could be potential pollution of the wastes to the environment.as high as 30000 tonnes upon complete construction of the plant). In reliance upon the R&D capabilities of Euro-
pean local waste plastic recycling qualifications and technology centers the high-performance recycled plastics
produced by the Company demonstrated leading advantages in efficiency quality and supply cycle achieving lo-
calized supply in Europe facilitating the achievement of the EU's carbon neutrality goal and promoting the Com-
pany's international development process.
63 64Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Transportation Procurement
Comprehensive Utilization Project of Tail Gas from Deethanizer of the PDH Unit
The Company requires the suppliers of hazardous chemicals The Company strictly controls the safety of the hazardous
In 2024 Liaoning Kingfa invested RMB 1.48 million in solving the long-term problem that the tail gas from the to entrust the carriers qualified for road transport of dangerous chemicals from the source purchases hazardous chemi-
deethanizer of the PDH unit could not be recovered relied on torch incineration treatment and caused energy goods to carry the hazardous chemicals. We strictly control and cals from qualified suppliers and requires the suppliers to
waste. Through technical transformation the tail gas of the deethanizer could be led out and transported to the inspect the incoming vehicles transporting hazardous chemi- provide corresponding material safety data sheets. For the
wastewater and exhaust gas incinerators of the acrylonitrile unit as fuel gas. After the transformation the project cals requiring the vehicles and transport personnel to take fire purchased hypertoxic precursor and explosive hazardous
provided 12500 tonnes of fuel gas in total for acrylonitrile production achieving resource recycling while reducing and explosion prevention measures when entering areas where precursor chemicals we take the initiative to report to the
carbon emissions effectively decreasing energy waste and environmental pollution and facilitating the enterpris- flammable and explosive hazardous chemicals are stored and public security organs in accordance with regulations and
es' green and low-carbon transformation. used. The vehicles and personnel shall also be equipped with perform due diligence.sufficient and effective emergency treatment equipment and
facilities as well as personal protection equipment.When handling the hazardous chemicals within the Company
each department shall formulate safe operating procedures for
Comprehensive Utilization System of the Propane Dehydrogenation Unit (II) for handling hazardous chemicals based on the characteristics of
Pollution and Carbon Reduction the hazardous chemicals educate and supervise employees to
handle the hazardous chemicals in a standardized manner.In 2024 Ningbo comprehensive utilization system of the Propane Dehydro-
genation Unit (II) for pollution and carbon reduction was officially put into Storage Use
use. Using an innovative waste heat recycling technology the unit convert-
ed the waste heat from production into medium-pressure steam for use by For the storage of hazardous chemicals the Company strictly The Company has established a strict management system
the entire plant significantly reducing dependence on external energy. Be- implements relevant regulations and standards such as the for the use of the hazardous chemicals. Our relevant pro-
sides traditional fuels were replaced with rich hydrogen to form a resource General Rules for the Hazardous Chemicals Warehouse Storage curement storage management safety management use
recycling model. Through energy cascade recovery and alternative clean fu- and all hazardous chemicals are stored in approved hazardous and operation personnel have undergone relevant training
els this project significantly reduced steam outsourcing fuel consumption chemical warehouses that conform to national standards. The and obtained qualification certificates in accordance with
and carbon emissions. It was selected as a pollution and carbon reduction hazardous chemicals are partitioned classified and stored in national requirements. We have maintained a complete
project in Zhejiang Province. Using a resource recycling model for promot- different warehouses by their characteristics. ledger for the receipt and use of the hazardous chemicals
ing energy conservation efficiency improvement and output increase it The hazardous chemicals warehouses shall be managed by per- and regular inventories are made.became a green benchmark practice for low-carbon development. Propane Dehydrogenation Unit (II) sonnel with corresponding professional knowledge and safety The Company is equipped with personal protective equip-
skills equipped with reliable personal protective equipment. ment up to national standards strictly requires the employ-
Corresponding safety facilities and equipment are set up in the ees to wear corresponding personal protective equipment
warehouses according to the types and characteristics of the when operating the hazardous chemicals and regularly
hazardous chemicals to ensure the safe storage of the hazard- conducts safety inspections practical training and emer-
ous chemicals at all times. gency drills.Chemical Safety
Emergency response Waste disposal
Kingfa Technology strictly abides by the national laws and regulations on the safety management of hazardous chemicals includ-
ing the Regulation on the Safety Management of Hazardous Chemicals in an attempt to reduce the risks of chemical accidents and We have drafted the Emergency Plan for Production Safety We have formulated the Management Procedures for Four Types
prevent accidents of hazardous chemicals. Incidents a reasonable complete and effective emergency of Wastes in accordance with relevant national and local laws
response plan for hazardous chemicals and organized no less and industry standards. The hazardous chemical wastes and
than one practical drill every year in accordance with the na- other wastes produced in the production process are collected
Strategies tional requirements. classified and temporarily stored according to company-level
national waste management documents and standards hand-
The Company has formulated the Safety Management System for Hazardous Chemicals Management Procedure for Hazardous ed over to qualified third parties for transfer and disposal. The
Chemicals Chemical Emergency Preparedness and Response Plan other rules and regulations to ensure the safety management Company performs whole-process risk identification and closed-
of hazardous chemicals in the whole lifecycle of procurement storage use and disposal. It regularly conducts safety assessment loop risk management for the compliant disposal of wastes in
safety training and education on the hazardous chemicals as well as emergency drills on hazardous chemicals incidents. In addi- order to make industrial solid wastes traceable and searchable
and ensure the compliant disposal of waste hazardous chemical
tion the Company actively promotes the intrinsic safety management of the hazardous chemicals encourages the R&D and appli- residues.cation of green environmentally friendly chemicals and reduces the possible impacts on the environment during production and
use from the sources.Chemical Safety Management
65 66Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Risk Management Management of Raw and Packaging Materials
The Company deeply understands the importance of raw and packaging material management for practicing green development
regards efficient resource utilization and waste reduction as its core management goals establishes strict raw material screening
standards gives priority to environmentally friendly renewable materials and optimizes production processes to reduce resource
consumption. Besides the Company actively promotes the lightweight design and recycling of packaging materials establishes
Comprehensive data Risk identification Review of safety facilities an internal recycling mechanism and significantly reduces waste generation. The systematic internal management measures con-
collection and analysis and management measures tinuously improve the resource utilization efficiency reduce environmental footprints with practical actions and provide strong
support for the realization of sustainable development goals.Statistically analyze the stock Regularly organize personnel Check the equipment of safety
types and storage locations of to conduct special inspec- facilities in places where the Raw Material Management
various hazardous chemicals. tions on hazardous chemicals hazardous chemicals are stored
Create a database for the haz- warehouses and laboratories. and used; regularly inspect the The Company is committed to improving the performance and quality of environmentally friendly raw materials giving priority to
ardous chemicals. Track and implement the rec- operation of the facilities and green raw materials and establishing strict procurement standards to ensure that the negative impacts on the environment are
tification. In combination with check the implementation of mitigated while meeting the functional requirements for products.the environment and operat- the safety management system Prioritize green raw materials Establish procurement standards Empowering upstream and
ing procedures the potential including personnel training downstream of the industries
risk factors of all positions in compliance with the operating Prioritize renewable degradable Establish stringent procurement standards for envi- Actively promote upstream and down-
an area are identified. Qualita- procedures emergency plans low-toxicity and low-emission raw ronmentally friendly raw materials give priority to stream enterprises of the supply chain
tive and quantitative methods and drills. materials and reduce dependence raw material suppliers who have passed environ- to use environmentally friendly raw on traditional petroleum-based mental protection certification and conformed to materials jointly build a green supply
are used for evaluation. plastics. international environmental protection standards chain and improve the environmental
and ensure that the sources of raw materials are le- protection of the whole industry.gal and environmentally friendly.Chemical Safety Evaluation Management Measures of the Company for Raw Materials
As of the end of the reporting period
To Reduce the Use of the Hazardous Chemicals Zhuhai Vanteque Specialty
Engineering Plastics Cancelled the Use and Storage of Xylene The Company had231pieces accounting for Up to100%
Xylene is a hazardous chemical with a "Class A" fire hazard. For this reason Zhuhai Vanteque Specialty Engineering of products that had passed sus- raw materials produced by the
Plastics completely cancelled the use and storage of xylene in the polyarylether resin process in May 2024 to elim- tainability-related certifications 1.88% of all products Company are traceable
inate the employees' health risks and hidden dangers of fire explosion. This action simultaneously reduced the
storage scale of the hazardous chemicals in the enterprises reduced the costs of environmental governance and
safety protection and optimized both production activities and environmental risks by reducing the emissions of Packaging Material Management
xylene volatile organic compounds (VOCs). In terms of packaging material management the Company reduces resource consumption and wastes by optimizing packaging
material design reducing unnecessary packaging layers and material use and implementing recycling measures. Committed
to constructing a scientific and efficient management system for saving packaging materials the Company formulated the Bag
Management Standards. By implementing strict systems for procurement storage use and recycling of the packaging materials it
reduces the wastes from the sources and increases resource utilization efficiency while ensuring the timely supply of the packaging
materials.Conditions of
emergency materials
Explosion-proof Reducing Disposable Consumption and Promoting Recycling of the Packaging Materials
lamps
Sprinklers
In 2024 Liaoning Kingfa organized a project for reducing the packaging
costs to decrease and recycle the slip sheets consumed during warehousing
and delivery. By replacing the existing 0.8 mm (disposable) slip sheets with
1.5 mm slip sheets (which may be reused more than 6 times) the project
Emergency Material Reserves for Hazard- Warning Signs of the Hazardous Wastes Firefighting System of the Hazardous significantly reduced the consumption of slip sheets and the use of dispos-
ous Wastes Warehouse Wastes Warehouse able slip sheets while generating economic benefits. As of the end of the re-
porting period the project approximately created benefits of RMB 1483400
and reduced the use of approximately 155700 disposable slip sheets. Recycling of Slip Sheets
67 680Soci2al
Responsibilities
While pursuing its own high-quality development the Company
bravely shoulders its social responsibilities and actively gives back
to the society. We focus on innovation-driven and intellectual prop-
erty strategies strengthen the technological innovation and indus-
trial chain advantages assure the product safety and quality and
optimize the supply chain efficiency. We actively assume our social
responsibilities promote our talent development participate in the
social welfare and rural revitalization protect the data security and
support the sustainable development of the industry and society.Highlighted results
Invested RMB and won
2.49 billion in R&D 3 Patent Excellence Awards
The score obtained in the and the total employee training
employee engagement was hours were as long as
82.47% 583501.8 hours
The incidence rate of and
occupational diseases was
0% 0 heavy work-related injuries occurred
SDGs benchmarking
69Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Innovation-drive and Intellectual Property R&D objectives
As the world's largest producer and consumer of new chemical materials China is facing strategic opportunities for optimizing Technology leadership Leapfrog development
the industrial structure and making continuous breakthroughs in high-end new materials in the new material industry. The rapid
development of strategic emerging industries such as new energy new infrastructure 5G communications artificial intelligence Under the background of national strate- Develop across fields industries and regions. Organize the con-
and VR/AR has brought new opportunities for the Company's continuous high-quality development. During the reporting period gic emerging industry support construct struction of a national industrial innovation center strengthen
the Company effectively responded to the complex internal and external environment strengthened the technological innovation "13551" as a R&D system based on global industry - education - research cooperation technology innovation
around the new quality productive forces enhanced the advantages of the integrated industrial chain and relied on the world's collaboration. Take the R&D of modified alliance integrate the existing innovation platform resources and
leading application innovation capabilities to provide global customers with more competitive and overall new material solutions. plastics as a breakthrough strive to im- build a combined innovation fleet with the business model that
prove technological innovation capabili- increases customer value as the traction with the construction of
ties make high-quality green and intelli- the R&D platform of Academia Sinica as the center 3 international
gent technological innovations in all links R&D centers 5 domestic sub-technology centers and 5 new chem-
Innovative vision Innovation mission actively carry out technological upgrading ical material incubation bases as the pivots and with world-class
Independent innovation Grow together with partners increase resource utilization efficiency innovative talents and teams as bases guaranteed by a systemat-
technology leadership glob- share achievements provide and enhance the Company's overall com- ic professional and efficient global collaborative work system to
al collaboration high-quality new materials for petitiveness. lead the common development of the industry.the society and create a won-
derful life.Innovation objective Innovation strategy R&D investments RMB 2490million
Construct a high-level all-round and Implement talent strategy
multi-level comprehensive innova- capital strategy brand strate- RMB 1973million
tion system in the industry for the gy and intellectual property
core purpose of gathering top inno- strategy combining standards RMB 1455million RMB 1454million
vative talents building a high-level and patents.R&D platform innovating the busi-
ness model and implementing an 2021 2023
advanced innovation management 2022 2024
mechanism. 2021 2022 2023 2024
Resource Input and Innovation Capacity Building
The Company has continuously developed the world's leading technology R&D platform created a R&D system known as "13551"
led innovation achieved leapfrog development improved its independent R&D capabilities developed clean renewable new Academic i an
Workstation P
products to lead the industry's technological upgrading in an attempt to become a global leading enterprise of new chemical ma- ed Tnizory
ec
terials achieve high-quality development and make technological innovations to serve the country through industry. t
Nationally Recognized En-
terprise Technology Center
1 central research 5 technical 1 national industrial National Engineering Labo-
institute sub-centers innovation center ratory
National Key Laboratory
National Industrial Innova-
1 3 5 5 1 tion Centero
ri rn ato Co
o n
s g ry
U
P o
h
s
t d o
arc
ctoral Res
e
Workstation
3 international R&D 5 incubation bases for new
centers chemical materials
Innovation Platform
"13551" - an R&D System
7172
Na
T te iost nin alg ly L Ra eb co ora g
p
iv ee rr as ti it vy e- R Ine ds ue sa tr ryc -h Center R&D
Key
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sKingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Key Technological Breakthroughs and Achievement
Transformation
Innovation management mechanism
Upholding "making independent innovations taking the lead in technologies and creating excellent products" the Company has
been accumulating technologies and studying products. Progressively we have built a R&D platform driven by technology indus-
The Company has formulated the Management Measures for Scientific Research Work
Sustained high-growth try and product research. We have made constant efforts in four major sectors namely modified plastics new materiwhere clear indicators have been put forward for the investment of scientific research funds
R&D investment and the growth rate of scientific research investment to promote its sustained and high- Science and Technology Honors
mechanism growth R&D investments.Second Prize of National Scientific and China Patent Excellence Award
Technological Advancement Award
The Company has standardized the process management of technological projects. Guided
by the market demand and for the major purpose of "making breakthroughs in key indus- Key Technologies for the Preparation of Degrad- Matte PE material manufacturing method Operation mecha-
tries" assure project quality and build an inter-departmental collaborative product devel- able Copolyesters Based on Precise Regulation of for same and applications thereof (the nism for market-ori-
opment team with the participation of product development marketing finance pilot test Soft and Hard Segments of Molecular Chains and Company)
production personnel and other members in order to ensure the rapid response to market ented technological Their Application in Agricultural Films (the Compa-
demand and the effective transformation of achievements and promote the orderly devel- projects ny and Kingfa Biomaterials)
opment of scientific research projects.China Patent Excellence Award China Patent Excellence Award
Implement a talent training plan for "external introduction and internal training" and vigor- PBAT resin composition (Zhuhai Wango
Scientific and Thermoplastic resin composition (Shang-ously perform innovative leading talent projects; make use of talent policies such as Guang- the Company Tianjin Kingfa)
effective talent dong Provincial Leading Innovation Team Plan to attract and introduce the talents. Inter- hai Kingfa the Company)
training manage- nally we create career promotion channels enhance the R&D capabilities of the technical
ment and incen- team and cultivate international competitive technical talents through training programs
tive mechanism such as "Genesis Plan" "Overseas Creation Plan" and "Creation Plan". For innovative proj- First Prize of Guangdong Provincial First Prize of the Science and Technology
ects incentives are offered according to project value and individual contributions. Science and Technology Award Progress Award of the Light Industry Council
Integrated Complete technologies for Key Technologies and Industrialization of
Upgrading and Recycling Waste Plastics Halogen-free Flame Retardant Polymers in
An enterprise
and Their Industrial Applications the New Energy Field
The Company's values are promoted through publications such as "Kingfa Science & Tech- culture cultiva-
nology News". A corporate innovation culture of "encouraging innovations and tolerating tion mechanism
failures" and a comprehensive innovation atmosphere of "innovation everywhere and inno- for encouraging
vation in everything" have been created. Second Prize of the Science and Tech- Second Prize of the Science and Technolo-
innovation and nology Progress Award of the Light gy Progress Award of China Petroleum and
tolerating failures Industry Council Chemical Industry Federation
Key Technologies for Preparing Sustain- Key Technologies for Preparing High-per-
able Polymer Composites for New Energy formance Polyolefin Composites for New
Vehicles (Shanghai Kingfa) Energy Battery Packs (Shanghai Kingfa)
During the reporting period
and Diancheren 2024 Smart Electric Vehicle "Technology
the Company had a total of 6 197 Innovation Award"professional technical 1 experts with special alforeign academician lowance from the State personnel above the deputy Ablation-Resistant Injection Molding Material for Power Battery Packs
Council senior level.
73 74Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Key technological R&D projects during the reporting period:
Business Business
Innovation achievements Innovation achievements
sectors sectors
Independently developed PFAS Free 5VA highly heat-resistant PPE which further improved Breakthrough progress was made in the project of "High-yield Succinic Acid Strain with Inde-
the flame retardance of the material apart from being PFAS Free as required by the customer. pendent Intellectual Property". The conversion rate potency and other indicators reached an
advanced level on a worldwide basis. The Company's independently developed high-perfor-
The self-developed flame-retardant enhanced PC products contributed to the long-term mance strains flexibly produced important chemical raw materials and products such as lactic
performance stability of outdoor security products and broke up the monopoly of foreign acid and succinic acid forming a "carbon cycle" of raw materials → finished products → com-
manufacturers in the security industry. plete biodegradation which contributed to the development of China's circular economy and
green GDP growth carbon peaking and carbon neutrality work.Independently developed bio-based PA5T LCP and other special modified engineering
materials resistant to higher temperature during use which met the industry's requirements For the self-developed halogen-free flame retardant the opportunity of green chemical up-grading was seized to overcome core technologies such as high heat resistance precipitation
for high current voltage and temperature rise. The materials are widely used in connectors resistance and long-term compatibility. Developed an environmentally friendly formula system
photovoltaics lithium batteries and power tools. and achieved industrial mass production. Promoted large-scale application in the global market
Modified plastics Independently developed rapid prototyping reinforced PBT which realized a significant de- and the technical indicators were internationally leading.cline in the molding cycle greatly improved the competitiveness of materials and achieved The Company's project on "Key Technologies for Preparing Degradable Copolyesters and Ag-
successful application in the automotive connector industry. ricultural Film Applications Based on Precise Control of Sof t and Hard Segments of Molecular
Chains" won the Second Prize of 2023 National Science and Technolog y Progress Award. As a
The self-developed chemically recyclable PBT transparent MBS and bio-based PA helped the leading and responsible unit the Company undertook the National Major Science and Technol-
customers reduce the carbon emissions of products. og y Project. Based on the major needs for the national "carbon peak and carbon neutrality"
Independently developed high-strength PA6 and realized the application of plastics instead strateg y we promoted the development in biomanufacturing and the new quality productive
forces and sped up China's overtake in the new track of bio-based degradable polyesters.of steel in automotive structural parts through hybrid structure design. The Company undertook the sub-project of the National Key R&D Plan achieving breakthrough
progress focusing on global environmental pollution problems (white pollution) giving full play
Fully biodegrad- to the advantages of application development and industrial manufacturing platforms and sup-
Through the self-developed core technologies such as intelligent fine sorting efficient clean- able plastics porting commercial promotion of biodegradable plastics in the packaging industr y.ing and low-carbon recycling an integrated overall industrialization solution was developed By creatively designing the molecular structure of resin modified PBAT useful for high-speed
Environ-
for the waste plastics. Related projects won the First Prize of Guangdong Provincial Science film blowing was developed. The film blowing speed was increased by 40% and the blown film ment-friendly
high-performance and Technology Progress Award. processing costs were cut significantly. The gaps between biodegradable packaging materials
recycled plastics and traditional packaging materials were further narrowed in terms of their processability. The
special materials for biodegradable films were further upgraded. The Company adapted to the
need that high-end flexible packages should be environment-friendly made breakthroughs in
Independently developed products such as high-rigidity high-toughness heat-resistant elec- the blown film-grade bio-based high toughness high transparency and high gloss technologies
troplated weather-resistant and chemical-resistant ABS breaking through the performance and realized small-scale application of high-end flexible packages reaching the world's leading
bottleneck of traditional ABS and gaining market recognition. level.Independently developed special high-performance modified materials for the toy industry Independently developed special materials for fully biodegradable straws based on the rapid
cr ystallization and modification process which solved the problem of low production ef fi-
which met the stringent requirements of the toy industry for safety durability and environ- ciency caused by low thermal deformation temperature and slow cr ystallization of traditional
ment-friendliness and provided core material solutions for upgrading toy performance. degradable plastic straws. The straws were highly heat-resistant with their rapid cr ystallization
Independently developed materials with high flow high rigidity and high impact properties; and the product innovations were widely recognized by downstream companies. The Company
successfully overcame technical difficulties on material odor control and spray painting that made phased breakthroughs in high-speed 3D printing applications. Domestically the product
quality was first-class and the product performance met various standards recognized by core
had long plagued the industry; greatly improved material properties and application perfor- customers.mance; overturned the dominant position of foreign companies in the field of these materi-
Green Independently developed bio-based PBT bio-based PBST and fully bio-based PBXY for degrad-als.petrification able film bags achieving a high compatibility between the bio-based and degradable satisf ying
Independently developed special modified polymer composites for the wire drawing indus- the multi-faceted diversified market needs leading the development orientation of the indus-
try shortened the product molding cycle and provided key technical support for the process tr y and consolidating the Company's leading position in the industr y.upgrading of the wire drawing industry.Continuous progress was made in the independently developed cyclic olefin copolymer Made breakthroughs in multiple key industrialization technologies of polyarylethersulfone.
(COC) its key monomer norbornene (NB) and key production technologies sold and recog- The industrialization unit with a capacity of 6000 t/year was successfully put into operation
Special Engi- and achieved full production capacity. The polymerization efficiency energy consumption and nized by the customers.neering Plastics quality were significantly improved.
75 76Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Material R&D for UAVs Facilitated the Development of Low-Altitude Economy
Business
Innovation achievements
sectors Nowadays when the low-altitude economy is booming the Compa- Consumer-grade UAVs
ny focuses on making R&D breakthroughs in the field of unmanned
aerial vehicles develops customized material solutions according Made of carbon fiber reinforced thermo-
to the differentiated needs for consumer-grade unmanned aerial plastic materials they are used in the injec-Independently developed a new generation of cold and thermal shock-resistant halo-
vehicles and industry-grade products provide strong support for the tion-molded body arms shock-absorbing
gen-free flame-retardant semi-aromatic polyamides which demonstrated excellent electri- development of the low-altitude economy and help the industry of plates platforms blade clips and other
cal safety at high-temperature and high resistance under harsh environment. The materials the unmanned aerial vehicles reach new heights. components to satisfy the performance re-
have been widely used in key areas such as high-voltage copper bars for new energy vehi- quirements.cles and ultra-high speed fans for servers providing leading material solutions for high-reli-
ability application scenarios. Industry drones
Independently developed ablation-resistant halogen-free flame-retardant semi-aromatic Use continuous carbon fiber composites to
polyamides which maintained structural integrity and excellent electrical insulation after make blades arms etc. to improve product
high-temperature burning and improved the safety and reliability of the 800V high-voltage quality and performance.architectures of new energy vehicles. New industry standards were established for protect-
ing safety of the high-voltage system of electric vehicles.Special Engineering UAV Application
Plastics Independently developed several types of LCPs with electrical performance control ul-
tra-high flow low warpage and high damping and shock absorption. The LCPs are widely
used in key components such as high-speed connectors CPU sockets and high-speed cool-
ing fans to promote high-speed and stable operations of AI servers and big data centers.Obtained a No Objection Letter from the FDA and Set a Benchmark for Recycling
The independently developed anti-cracking LCPs have been widely used in the structural Technologies
parts for packaging new energy batteries to improve the packaging efficiency and safety of
new energy batteries. In the face of high-standard supervision over the food-grade recycled materials in Europe and the United States the
Company obtained a no objection letter (NOL) from the US FDA (Food and Drug Administration) in September 2024
Independently developed the second-generation polymerization technology for extru- becoming Asia's first Company that passed this certification. In this letter a reply and a confirmation were made that
sion-grade LCP resin. The resin produced was used in high-strength LCP fibers in large the Company's recycled HDPE recycling process could produce food contact grade HDPE (covering all scenarios such
quantities which greatly improved the fiber strength and stability. as high-temperature sterilization and refrigeration) marking that the Company's recycling technologies had been
recognized by international authorities. The Company not only broke through the barriers of the high-end food pack-
aging market in the United States but also realized 100% conversion of post-consumption waste plastics into food-
grade materials setting a technical benchmark for the Asian recycled plastics industry and accelerating the upgrad-
ing of the global industrial chain to a highly safe high-value recycling model.A self-developed gradient energy-absorbing high-impact steel-plastic composite board
Carbon fiber and improved the application capabilities of thermoplastic composites in the field of new
composites energy vehicles.The Breakthrough in the Supercritical Electrostatic Injection Technology Realized
Independent and Controllable Production
The self-developed nitrocellulose microporous membranes for in vitro diagnostics have Kingfa Medical independently initiated an innovative R&D project of the "Complete Production Line Based on the
been put into pilot-scale production successfully breaking through the technical barriers Supercritical Electrostatic Jetting Principles and Technologies" to develop high-strength functional supercritical
and bottlenecks in this field laying a solid foundation for large-scale mass production electrostatic jetting nonwovens for medical protection and packaging products. Kingfa Medical deeply explored the
and market application and accelerating import substitution. formation mechanism and regulation mechanism for supercritical electrostatic jet nonwoven micro-nano structures
clarified the structure-activity relationships among the functionality processes and raw material structures and re-
The self-developed super-soft nitrile gloves and high-grade chemical-resistant gloves alized independent controllable production of high-strength functional nonwoven materials and their preparation
Healthcare have successfully been put into use in high-end fields including dentistry foods and technologies.polymers chemicals highly recognized by customers for their excellent product performance and During the reporting period Kingfa Medical made remarkable progress in this project. It not only completed the
quality. systematic optimization of dissolution blown spinning screen laying hot rolling and other processes but also suc-
The self-developed multi-grade and multi-functional air filters have achieved mass pro- cessfully developed the pilot production line preparation process and smoothly completed customer samples for the
duction and sales empowering the development of the industry and being well received medical packages. As of the end of the reporting period the overall pilot plan and main equipment had been devel-
by customers. oped and the pilot production line had been installed. It is expected that the system debugging and process package
will be output in 2025 to achieve continuous and stable production of the pilot production line. The successful im-
plementation of this project not only demonstrates Kingfa Medical's independent innovation capabilities in the field
of supercritical electrostatic jet nonwovens but also lays a solid foundation for China's technological breakthroughs
and industrial upgrading in this field.
77 78Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Intellectual Property Protection Safety and Quality of Products and Services
The Company has formulated management systems for intellectual property protection including the Intellectual Property Man-
agement Manual and the Procedural Documents for Intellectual Property and established corporate standards such as the Intel- We adhere to the quality concept of "maintaining survival based on standards becoming powerful in reliance upon quality and
lectual Property Management Regulations. A clear intellectual property management system has been established defining the taking the customers first". We have established a standardized and lean product safety and quality system provided our custom-
responsibilities of the management representatives competent intellectual property and other relevant authorities and standard- ers with all-round full-cycle service support and ensured that all products demonstrate excellent "Kingfa quality".izing the management of intellectual property declaration ownership use and infringement. The intellectual property manage-
ment system is annually audited. The Company has been certified by the intellectual property management system and won the
honor as a National Advantageous Intellectual Property Enterprise. Product Safety and Quality
Intellectual property management The Company has established a product quality management system covering the Quality Manual and Incoming Material Inspec-
tion Process to strictly control the quality of the whole product process to ensure stable and safe quality. During the reporting peri-
od the Company and all its subsidiaries passed the quality-related system certification.A technical committee composed of product line managers R&D engineers and patent engi-
neers was set up. Various intellectual property platforms such as the "National Technical Com-
mittee for Standardization of Plastic Products/Sub-technical Committee for Modified Plastics"
Patent and "Guangdong Advanced Manufacturing Standardization Pilot Unit" have been established Analyze risks and Keep customer infor- Standardize operations
standardization to promote the Company's transformation from product leadership to patent and standard draw up preventive mation confidential; and make labels trace-
leadership. measures quality specify product and able; audit products
standards and plans service requirements; and provide customer
for their realization. review design and de- services; dispose of the
velopment outputs. nonconforming prod-
During the reporting period ucts in the reported
channels.Number of valid patents Annual number of new invention Number of new invention pat-
owned patent applications ents authorized in the year
2977 558 409 Planning risks and Quality support Operations for External operations Provisioning of opportunities resources quality control management production services
Number of copyrights owned Annual number of new copyrights
18 1 The operational en- Strictly select and man-
vironment and the age suppliers; develop
measurement system a supplier quality man-
Number of trademarks owned Annual number of new trademarks are up to standards. agement system and
281 27 The human resources perform second party meet the capability audits.
requirements. The
document systems
are standardized.Quality control procedure
Support for a Supplier's Control over Metal Contaminants
In 2024 the Company provided on-site support for a supplier's control over the foreign contaminants of the PPS res-
During the reporting period the Company won in set up 6 metal control nodes from raw materials to finished products used iron removal rods metal detectors and
3 other detection methods and replaced metal filters with PPS filters. The process effectively eliminated the generation China Patent Excellence Awards. of metal impurities assured product quality mitigated product risks resulting from metal foreign objects and helped
The Company and its subsidiaries conducted intellectual proper-
ty and patent protection training respectively the supplier improve its product quality and capabilities.
79 80Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Product Recall Cultivation of Quality Awareness
The Company prevents and averts recall risks ahead of risk analysis. We standardize the after-sales product disposal process spec- The Company actively carries out the quality-related training builds a quality talent echelon and has the quality awareness deeply
ify the recall process and the responsible department in the Quality Control Specifications for Product Shipment and incorporate rooted into the hearts of all employees. During the reporting period the Company continuously improved the training of quality
on-site product return and recall data into our performance indicators related to customer satisfaction to truly protect the rights management-related talents to meet the Company's needs for high-quality development and global quality talents:
and interests of the customers. Since its establishment the Company has not experienced any recall.Trained 12 talents for each echelon including department heads and supervisors. All supervisors
undertook job rotations till it was conducive to their business improvement or personal growth.Operations Planning and Warehousing Added 3 key quality account managers to enhance the extension to Japan and Vietnam.Department Department Quality Department
According to the product recall Make transportation arrange- Control quality in the whole Appointed 2 R&D quality managers to discuss the reliability of formula design quality management
orders of the Quality Depart- ment for the recalled products production process and ana- Echelon of sample delivery trial production assurance formula change evaluation etc.ment recall the nonconforming and implement corresponding lyze the causes of nonconform- construction Appointed 5 engineers and foremen to change the foreman model that focused on the execution
products from the market and measures according to market ing products. Supervise the into an engineer empowerment model to build specialized inspection platform.carry out subsequent work. requirements. implementation of correspond-
ing measures and follow-up
improvement measures.Product Recall Procedures The senior management assisted in continuously promoting the training of new employees.Management of Hazardous Substances The LSSGB program was started for systematic training about the Six Sigma awareness and method.Talent
Performed the Golden Shield Plan Phase II.The Company always protects product safety strictly controls the use of hazardous substances in products and formulates the training
Technical Standards for the Control of Hazardous Substances to clarify the prohibited substances in the raw materials to ensure
product compliance and minimize the adverse impacts on the environment. During the reporting period the Company and its
three subsidiaries obtained the QC 08000 Hazardous Substance Process Management System Certification.The Company continuously updated the regulated list of hazardous substances and drafted reduction and control plans which
should be strictly implemented by the Company and its suppliers. When reviewing the new and qualified suppliers the Company Customer services
will check the prohibited substances separately. If the suppliers fail to meet the standards the Company will require the suppliers
to complete the rectification and re-audit them within one month. If the suppliers still fail the re-audit no new suppliers will be in- The Company has formulated customer service systems such as Customer Complaint Management Regulations to provide the
troduced and the qualified suppliers will be directly eliminated. customers with prompt services before during and after sales quickly standardize the process for handling customer complaints
respond to customer demands in a timely manner and improve customer satisfaction with its products and services.Control over the Company's new hazardous substances during the reporting period
Control Guiding principles for handling customer complaints
level List of substances Control method
Isopropylphenyl phosphate medium-chain Chlorinated paraffin poly- Ban their use in the products immediately and
brominated biphenyls poly brominated diphenyl ethers polychlorinated intentional addition is prohibited for any items.Level I biphenyl dicumyl peroxide 2-(2-hydroxy-5-tert-octylphenyl) benzotriazole The content of all product compositions must Transparent Responsive Free
(UV - 329) 2 4 6-tri-tert-butylphenol (2 4 6 - TTBP) and diphenyl (2 4 meet the control requirements or special cus-
6-trimethylbenzoyl) phosphine oxide tomer requirements except those that comply with the exemption items and can be exempted.
PFAS 6-[(C10-C13)-alkyl-(branched unsaturated)-2 5-dioxopyrrolidin-1-yl] Prohibit their use after the specified date. To Focus on customers Convenient Confidentiality
Level II hexanoic acid triphenyl phosphorothionate octamethyltrisiloxane per- use them in the manufacturing process the fluamine reaction mass of triphenylthiophosphate and tertiary butylated suppliers shall consider and draft a mitigation
phenyl derivatives tris (4-nonylphenyl branched) phosphite and gradual replacement plan.Fair Responsibilities Continual improvement
The suppliers need to pay attention to their use.Triphenyl phosphate resorcin perfluorobutanesulfonic acid (PFBS) and Currently the period of use is not specified and
Level III its salt decamethylcyclopentasiloxane (D5) dodecamethylpentasiloxane these materials will be automatically converted
(D6) octamethylcyclotetrasiloxane (D4) into Class II controlled substances with the in-
troduction of new regulations.
81 82Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Emergent Urgent General Supply Chain Security
Make an emergency response Make an emergency response Handle the complaint normally
within 8 hours and provide the within 12 hours and provide and offer an initial reply or sug- The Company has constructed and continuously improved the supplier lifecycle management system built an SRM platform and
investigation results within 2 the investigation results within gestions within 1 business day.business days. In case of any 2 business days. In case of any Make the final suggestions on realized targeted transparent supply chain management based on the differentiated needs of all the Company's business segments
anomaly contact the superior or anomaly contact the superior or how to handle the complaint and product categories. We have leveraged our own advantages to continuously empower our suppliers' performance in the quali-
the complainant in time to give the complainant in time to give within 3 business days. If the ty system ESG and other aspects to build a sustainable supply chain.an explanation. an explanation. customer puts forward special
requirements for time reply with-
in the time limit specified by the
customer. In case of an abnor-
mality in the handling process
report to the complainant as Qualification Introduction Supplier confer-
soon as possible. pre-examination management ences
On-site Audit
Graded responses to complaints Business
Supplier resource pool exchanges
Risk warning
(credit finance Relationship
quality delivery) management Technical exchanges
Tel: +86(020)-66818888 Address: 33 Kefeng Road Science City Official Account:
User Trading Fax: +86(020)-66848888 Postal Code: 510663 Kingfa New Materials Performance Quality
feedback suppliers exchangesContract guarantee management
channels (technologies qual-
ity supply social
responsibilities) Platform Classified Qualified interactions
management suppliers
Promotion of key customer service model
Supplier management process
In 2024 the Company continuously promoted the quality management model for key accounts and expanded the
capacity of 32 major customers. Starting from demand identification source management resource transformation
innovation leadership quality trust and collaborative cooperation we exactly satisfied the quality and service needs
of the key accounts. The one-way service model was changed into a customer-focused iron triangle service model
which greatly improved the services.Business Technical
Business
Quality
Customers (internal
客户服务模式转变 Quality operation)
Technical (internal
operation)
Customers
Change in the Customer Service Model
8384
Collaboration mechanism
Offboarding management
Risk control mechanismKingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
During the reporting period the Company revised the Evaluation and Application Procedures
for Supplier Classification Management. In combination with the principles for evaluating the Continuous improvement of the supply chain digitalization system
importance of material categories and supplier dependency we classified the suppliers of var-
Classified
management ious materials and carried out differentiated management for four types of suppliers namely
In 2024 the Company continuously improved the
strategic suppliers key collaborative suppliers collaborative suppliers and general suppliers. SRM system portal launched a non-raw material
e-commerce platform and increased procure-
ment efficiency. The Company published the
Formulate supplier introduction rules to standardize the selection and management process management requirements such as the Supplier
Management Manual and the Notice of Honest
for the new suppliers. Establish differentiated supplier introduction standards based on the
Cooperation on the portal to guide the suppliers
needs for category management to strictly control supply risks evaluate upstream supply ca- to learn and implement relevant requirements.pabilities and accommodate the needs for resource reserve and optimization. Through the SRM system the Company contin-
The Purchasing Department conducts pre-qualification review for all potential suppliers. The uously strengthened its communications with
Onboarding its suppliers standardized its cooperation and
management raw material suppliers shall at least pass ISO 9001 certification and attention is paid to the increased the efficiency and transparency of the SRM System
suppliers certified by ISO 14001 ISO 45001 and other relevant systems. Conduct on-site audits supply chain management.when necessary. Comprehensively evaluate the suppliers' operation status production capaci-
ty and management to improve their overall qualification.Formulate the Supplier Audit Management Regulations and conduct routine audits for key Management optimization for the suppliers of recycled materials
suppliers according to the audit plan. Evaluate whether the suppliers' management systems
remain effective and are continuously improved. Audit problematic suppliers to evaluate the In 2024 the Company optimized its management system for the suppliers of the recycled materials improved the
Audit effectiveness of the suppliers' problem improvements in order to eliminate the suppliers with full lifecycle management and clarified the exit mechanism. We built a fixed audit team for on-site audit clarified the management
supply risks in a timely manner. qualification level of all suppliers of the recycled materials initiated rectification for 42 underperforming suppliers and
gradually started to eliminate the suppliers with poor on-site management. This improved the purchase management
and supplier performance ensured the stability of the supply chain and promoted sustainable development.Formulate the Supplier Performance Management Regulations and continuously pay attention
to the suppliers' performance in delivery quality and services Output the overall performance
results of the raw material suppliers on a quarterly basis and put them into practice. Provide Sustainable Procurement
the suppliers with corresponding incentives rewards and punishments for the suppliers with
Performance
management different performance levels (A-D). Improve the efficiency of the supply chain and realize the The Company works closely with the suppliers to jointly remain committed sustainable development goals and create sustainable
differentiated demonstration of supplier value. value. During the reporting period the Company issued the Sustainable Procurement Policy. In terms of environmental protection
we prioritized environmentally friendly suppliers focused on the environmental protection of raw materials and equipment and
clarified waste management requirements. Regarding the labor workers' human rights priority was given to the suppliers who had
Closely track the political military economic climatic and other trends in different regions of passed relevant certification. Human rights were prohibited from infringement to protect the employees' rights and interests. In
the world. Identify the risk factors and draw up risk plans in advance. Adjust procurement and terms of business ethics we advocated that both parties should maintain integrity conclude fair transactions and respect mutual
inventory strategies in a timely manner including increasing raw material reserves locking raw intellectual property.material orders in advance and making early preparations for raw material substitution. Elim-
inate potential adverse effects of risks. Establish an early warning mechanism for high-risk raw The Company constantly promotes the continuous improvement of the ESG management in the supply chain through the closed-
Risk materials and keep informative about the supply chain by continuously tracking the produc- loop management of "training - evaluation - improvement":
Management
tion status of upstream suppliers and signing four major agreements with the suppliers includ- Normalized training Systematic assessment Targeted improvements
ing supply agreements quality assurance agreements environmental protection agreements
and technical agreements.Strengthen communication and col- Systematically perform sus- Establish a hierarchical man-
laboration on the annual supplier con- tainability risk assessment and agement system based on
ference special capacity training and audit environmental and social supplier ESG portraits draft
supply chain support plan. Our SRM responsibilities. targeted improvement plans
Supplier conferences technical exchanges daily business exchanges quality exchanges plat- systematically carries out training on and incorporate them into
Collaborative form interactions etc. the sustainability concept including the supplier performance ap-
management CSR management EHS diversified praisal.construction and requirements waste
Supplier Management System management sustainable water man-
agement and other topics.
85 86Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Indicators and Targets
Dimensions for Auditing the Suppliers' Environmental
and Social Responsibilities
Sustainable procurement objectives Progress of the objectives
Child labor and minor Working hours and salaries Management of toxic flammable Management of occu-
and explosive products pational diseases
Compared with 2022 achieve a 30% reduction in carbon In 2024 the Company's carbon emissions related
Anti-discrimination Morality and integrity Freedom of association Safety emissions related to procurement activities by 2030. to procurement activities were reduced by 5%.Lodging sanitation Forced labor Free choice of employment Environmental
management From 2022 to 2030 ensure that the coverage of the an- In 2024 the coverage of sustainable procurement
Information security Intellectual property Energy conservation and emis- Resource utilization nual sustainable procurement training of purchasing training by the purchasing specialists was up to
sion reduction
specialists reaches 100%. 100%.During the reporting period From 2022 to 2030 ensure that the suppliers comply with
In 2024 100% of the raw material suppliers were
labor laws and regulations and annually 100% suppliers
qualified in protecting the laborers' rights and in-
are qualified in protecting the rights and interests of la-
the Company conducted terests.borers.
2 ESG training sessions for
the suppliers From 2022 to 2030 the Company ensures that 100% of In 2024 72% of the Company's stable suppliers
key raw materials will be from the suppliers with envi- of brand new raw materials were certified by ISO
covering ronmental management system certification (ISO 14001). 14001.
100%
In 2024 the SRM portal was built. The supplier
of the suppliers and there were code of conduct was published and announced in
no suppliers with actual or po- From 2022 to 2030 ensure that the supplier code of con- the SRM portal. At present all our suppliers have
tential significant negative envi- duct will be 100% signed every year. SRM system accounts and they need to log in to
ronmental or social impacts. the system for daily purchase quotation informa-
tion receipt and interaction.
2024 Supplier Conference on "Deepening Cooperation Optimizing the Platform and Pro-
moting Global Development" Conveying the Sustainability Concept
Compared with 2022 the on-site audit coverage of core In 2024 the on-site audit coverage of the Compa-
suppliers will increase to 90% by 2030. ny's core suppliers was 80%.Contractor Management
The Company has established a contractor safety management mechanism that focuses on "who is in charge and who is responsi-
Notes: Stable suppliers of new raw materials refer to suppliers with a (valid) source list which provide brand new raw materials and are manufacturers.ble". We ensure that the safety risks of contractors' operations are controllable by controlling the whole process of "review - notifi-
cation - supervision - accountability".Examination Notification
Examine the contractors' safety qualifications partic- Clarify the safety responsibility boundaries through
ularly evaluating their legality adaptability reliabil- the Contractor's Internal Operating Safety Instruc-
ity technical and safety guarantee capabilities. The tions and the Contractor's Safety Environmental
examination results are reported to the Office of the Protection and Occupational Health Management
Work Safety Leading Group for archiving. Agreement.Accountability Supervision
Identify responsibilities of and punish the contractors All personnel of the contractor shall undergo safety
who violate safety regulations and cause accidents education and training before their entry. The Com-
according to the Company's accident investigation pany dispatches safety management personnel to
procedures. supervise the daily on-site safety inspections.
87 88Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Support for Industry Development Participated in the 3rd International Green Zero Carbon Festival and 2024 ESG Leaders Summit to Promote the Green Transformation of the Plastics Industry
In July 2024 the Company was invited to attend the 3rd International Green Zero Carbon
As a leading enterprise within the industry the Company always firmly believes in the positive value of cooperation and sharing for sustain- Festival and 2024 ESG Leaders Summit. The general manager of the sustainable devel-
able development of itself the industry and the society during innovations. To facilitate the industry win-win we cooperate with our do- opment product line delivered a keynote speech on "Deepening the Green Technology Innovation and Promoting the Development of new quality productive forces". Starting
mestic and overseas associates upstream and downstream enterprises to exchange and learn about new opportunities and achievements from the innovation of the industrial chain he introduced the Company's practical path
in the development of the industry. We actively undertake the responsibilities of industry associations promote the formulation of industry of constructing an entire green low-carbon industrial chain system and innovating the
standards carry out in-depth exchanges and scientific research project cooperation with universities and guide the future development model of circular economy by "making the best use of the plastics". During the meeting the Company deeply participated in industry dialogues and shared its experience and
trend of the industry with technological innovations. achievements in green development in the plastic chemical industry. It not only demon-
strated the Company's green development concept but also built consensus on the green
transformation of the plastics industry and promoted the industry to join hands towards
Joint industry advancement the carbon neutrality goals.Delivered a keynote speech
To promote joint construction and win-win in the industry we actively participate in exchanges exhibitions and other activities related to
materials and sustainable development and realize the coordinated development mutual benefit and win-win of the industry through in- Representatives of the Company's ESG Working Group Actively Participated in the
tuitive and high-quality exchanges. Global Sustainability Forum and Exchange
Industry events The Company was invited by Guangzhou Representative Office of Macao Trade and
Investment Promotion Institute to participate in the opening ceremony of the "2024 Ma-
cao International Environmental Cooperation Forum and Exhibition". Representatives of
the Company's ESG working group and participants from different industries shared and
In October 2024 the Company participated in the VDA The Chairman led a team to participate in the technology discussed environmental concerns such as ESG and sustainability. By participating in
Round Table. exhibition at the head office of Toyota in Japan. this event we strengthened the expansion of exchanges and cooperation among Guang-
dong Hong Kong Macao and the world in government industry academia research
and application and jointly promoted the diversification of circular economy and green
sustainable development. Participated in the forum and exchange
Attended the SPE TPO Global Automotive Conference to Share Experience in the
Field of Lightweight Automobiles
In October 2024 the Company participated in the world's leading engineering polyolefin
Kingfa (USA) participated one of the world's most in- forum - SPE TPO Global Automotive Conference focusing on the application of polyole-fins in the fields of automobiles and ground mobility. Our industry manager released
Shanghai Kingfa won APTIV Outstanding fluential SPE Automotive Innovation Awards Program a thematic report on the "the application of high-performance transparent polyolefin
Contribution Award. and entered the Finalist round of the transparent materials in luminous automotive bumpers" showcasing the Company's innovative
bumper innovation program. achievements in the R&D of lightweight materials and contributing to the application of
polyolefins in the field of automobiles.Participated in the SPE TPO Global Automo-
tive Conference
Deep Industry Engagement
Since its establishment the Company has actively participated in establishing industry standards for polymers modified plastics recycled
plastics bio-based materials etc. and discussed with associations. Taking the national deployment for the long-term development of stra-
Awards tegic emerging industries as our own mission we actively participated in and undertook the national key program to contribute to industry
development and industrial upgrading.The Company won Dongfeng Nissan's "Best Partner
Award of the Supply Chain of the Year".Kingfa Biomaterials won the "Emerging Star Award"
at the Innovative 3D Strategic Supplier Conference.The Company was evaluated by L'Oréal as "Strategic In September 2024 Liaoning Kingfa as a member of the National In October 2024 the Company held "Project of Guangzhou - a Capital of In-
Acrylonitrile Industry Association attended the annual meeting to ternational Academic Conferences - Key Technology Innovation Salon of New
Packaging Partner". exchange and discuss the industry production issues. Composite Materials for Batteries" to discuss cutting-edge technologies.
89 90Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Diversified Cooperation
The Company played important roles in several technology standardization committees including National Technical Standardiza- Guided by the needs for industrial development the Company actively establishes strategic cooperation with enterprises and insti-
tion Committee on Plastics ISO/TC61/SC9/WG27 and ISO/TC330. As of the end of the reporting period the Company took the lead tutions of higher learning to promote deep integration of industry academia and research.in and participated in the drafting and publication of 12 international standards and presided over/participated in the formulation
and revision of more than 200 national industry local and group standards.Standard Number Standard Standard Joint laboratory for joining forces to promote material innovationsstatus
ISO 15373:2024 Plastics - Polymer dispersions - Determination of free formaldehyde Released In 2024 the Company established a joint laboratory with 7 leading companies of automobile home appliances elec-
tronics electrical new energy and other industries developing joint development projects based on industry devel-
GB/T 44535-2024 Plastics - Determination of linear dimensions of test specimens Released opment trends including intelligent driving lightweight replacement steel with plastics and electrical performance
tests which effectively promoted material innovation and R&D.GB/T 44303-2024 Plastics - Quantitative evaluation of scratch damage and scratch visibility Released
GB/T 44559.1-2024 Plastics - Determination of puncture impact behaviour of rigid plastics - Part 1: Non-in-strumented impact testing Released
GB/T 33596 Electrical installations in ships - Insulating and sheathing materials for shipboard and Solicitation of offshore units power control instrumentation and telecommunication cables comments
ISO 15373:2024 Plastics - Polymer dispersions - Determination of free formaldehyde Released
GB/T 1632.1-2024 Plastics - Determination of the viscosity of polymers in dilute solution using capillary vis-cometers - Part 1:General principles Released Cooperation on the Joint Laboratory
GB/T 2035-2024 Plastics - Vocabulary Released
GB/T 5169.12-2024 Fire hazard testing for electric and electronic products - Part 12: Glowing/hot-wire based test methods - Glow-wire flammability index (GWFI) test method for materials Released
Expanding the Business Layout and Practicing Green Development
GB/T 5169.13-2024 Fire hazard testing for electric and electronic products - Part 13:Glowing/hot-wire based test methods - Glowing-wire ignition temperature (GWIT) test method for materials Released
In 2024 the Company leveraged its upstream resource advantages and downstream processing expertise to expand
its business areas accelerated the construction of a plastic recycling industry ecosystem and strengthened full-chain
GB/T 5169.23-2024 Fire hazard testing for electric and electronic products - Part 23:Test flames - 500W verti-cal flame test method for tubular polymeric materials Released synergy capabilities through strategic cooperation.Fire hazard testing for electric and electronic products - Part 48: Glowing/hot-wire based the Company entered into a contract with a representative industry of the renewable resources
GB/Z 5169.48-2024 test methods - Hot wire coil test method - Apparatus verification test method and guid- Released
ance industry to cooperate on the laboratory construction material production and sales and utili-In July
zation of household appliance dismantling materials to achieve resource sharing and comple-
GB/T 29284-2024 Polylactic acid Released mentary advantages.GB/T 40006.11-2024 Plastics - Recycled plastics - Part 11: Polyvinyl chloride (PVC) materials Released
the Company joined hands with China Renewable Resources Group explored the establish-
GB/T 44443-2024 Green product assessment - Computers Released In
ment of a joint venture based on the green concept jointly set up a sorting center and built a December
"unified purchase and marketing" cooperation model.GB/T 44447-2024 Green product assessment - Printers and multifunction devices Released
GB/T 45090-2024 Plastics - Labelling and marking of recycled plastics Released
GB/T 1632.1-2024 Plastics - Determination of the viscosity of polymers in dilute solution using capillary vis-cometers - Part 1:General principles Released
91 92Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Multiple institutions of higher learning cooperated to cultivate talents and Fight against discrimination Child labor and and harassment minor workers
promote innovation
We have formulated the Anti-Discrimination and Anti-Ha- Having formulated the Management Regulations for Child La-
In 2024 the Company continuously promoted industry-academia-research cooperation facilitated deep integration rassment Management Regulations following the principles bor and Minor Workers we don't accept suppliers or partners
of industry and education cultivated and reserved professional talents for enterprises drove scientific research inno- of fairness justice and transparency in all aspects to ensure which employ child labor or minor workers.vation accelerated the transformation of results and supported the sustainable development of the industry. equal employment opportunities. We implement stringent age verification procedures for re-
We have been carrying out publicity and education activities cruitment require the provision of identity documents ques-
Shanghai Kingfa carried out industry-academia-research cooperation with several institutions of to prevent and stop harassment posting the rules and regula- tion about educational backgrounds and age in interviews
higher learning: It negotiated with Fudan University to jointly build a "Road to a Strong Country" tions in conspicuous places such as bulletin boards. and perform background checks if necessary.ideological and political course teaching practice base exchanged views on industry-academia-re-
Shanghai The employees can file complaints through suggestion boxes Once it is found that child labor is recruited by mistake the search cooperation and joint laboratory construction and reached intentions to deepen coopera-
Kingfa dedicated mailboxes etc. When discovering discrimination children will not be dismissed immediately. Instead we will tion. It negotiated about joint doctoral training with Donghua University and carried out technical
exchanges on non-woven products. It discussed with the University of Shanghai for Science and and harassment we will collect evidences and build a team take remedial actions report to a labor bureau and arrange
Technology on the cultivation of innovative engineering talents carried out technical exchanges for investigation. After confirmation punish the relevant per- medical examination. Provide treatment for the child labor
with Zhejiang University and built an off-campus practice base with Shanghai University. sonnel appease the victims arrange paid sick leave and work with illness. After soliciting opinions the Company shall bear
normally after recovery. the expenses require the guardian to sign for acknowledging
them provide financial assistance and keep records.Kingfa Kingfa Carbon Fiber joined hands with nine organizations including Sichuan University to partici-
Carbon pate in the joint declaration of the national key R&D program.Fiber
Forced labor Labor protection for
Wuhan Kingfa successively cooperated with Jianghan University to develop key technologies for female employees
Wuhan high-performance protective safety polymers for new energy batteries studied the technology for
Kingfa preparing high-performance polyolefin composites for new energy battery packs with South-Cen- Having formulated the Management Regulations on the Pro- Having formulated the Regulations on Labor Protection tral Minzu University and cooperated with Hubei University and Wuhan University of Technology to hibition of Forced Labor we prohibit coercive or deceptive and Management of Female Employees we have created a
build an internship base. means and protect the employees' rights to rest vacation and diverse inclusive culture attached importance to the rights
termination of labor relationships during the term of the con- and interests of female employees and emphasized equality
tract. The Company does not restrict these rights in violation between men and women and equal pay for equal work.Ningbo of laws. We gradually improve our sanitary conditions regularly orga-
Kingfa Ningbo Kingfa was approved to establish a national postdoctoral research workstation. Promote the protection of human rights and anti-forced labor nize professional organizations to assist with health care set
concepts to the suppliers contractors and other partners. up relevant facilities in collective dormitories and regularly
The new employee orientation training notices may be given organize physical and gynecological examinations.through the suggestion box email reporting hotline and OA We buy the maternity insurance for our female employees
Kingfa Kingfa Biomaterials and South China University of Technology jointly built Guangdong Provincial system. according to regulations; reimburse their security and living Biomate- Postdoctoral Innovation Practice Base. Once forced labor is discovered the HR Department will com- expenses during their pregnancy; offer them insurance ben-rials
municate with the trade union in time for appeasement and efits during their childbirth (abortion); provide them with
remedy. breastfeeding leave and living expenses after maternity leave
build a committee for safeguarding the female employees'
rights and interests.Equality Inclusion and Diversity
Equality Inclusion and Diversity
During the reporting period
We uphold being people-oriented fair open and impartial giving priority to morality and attaching equal importance to capa-
bilities and good virtues. We are committed to creating a diverse equal and inclusive work environment to promote innovation
enhance teamwork and ensure that all members give full play to their potential. the Company had a total of The labor contracts All employees returned to were concluded with work after their parental 189
During the reporting period the Company continuously improved the management systems related to recruitment personnel and 13083 employees all employees leave disabled employees were
labor management revised and newly compiled 10 management systems including the Recruitment Management Regulations cumulatively recruited
Personnel Management Regulations and Internal Recommendation Management Regulations and promulgated the Labor and
Human Rights Policies to clarify its specific action guidelines and objectives in all aspects of employee rights and human rights Women accounted for and
protection and ensure the smooth achievement of the objectives. 160
retired soldiers were cumulatively 12% 4%
The Company strictly complies with the Universal Declaration of Human Rights ILO Core Conventions Social Accountability (SA employed of the Company's middle of the senior management
8000) other local laws and regulations international labor conventions and initiatives. We carry out a number of actions to ensure management
equality tolerance and diversity in the employee management.
93 94Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Talent Attraction and Retention
The Company is committed to safeguarding the legitimate rights and interests of the employees building a diverse and inclusive During the reporting period
corporate atmosphere and effectively implementing various welfare and care measures to increase all employees' sense of happi-
ness and belonging and ensure that the employees may feel warmth and respect in the Company. the Company conducted an employee en- covering multiple business sectors and em- and an increase of
gagement survey and collected a total of ployee categories with an engagement of
As of the end of the reporting period 5493 5.4%valid questionnaires 82.47% compared with last year
e
rs o
f the mploy
a total of and no
er
675 people participated in 197were evaluated as
the evaluation of professional and senior engineers (experts) all of The Trade Union and Employee Congresses Was Held and the Democratic Communication Jointly Promoted Enterprise Development
technical qualifications whom enjoyed housing benefits
In December 2024 the Company held the third member
Among them representative conference of the eighth Trade Union and
the second Employee Congress of the eighth Trade Union.
261 professional engineers Our leaders and more than 120 member (employee) repre-The Company was awarded the
were rated as intermediate engineers sentatives gathered together. All employee representatives title of "2024 Best Employer" by voted with a show of hands and unanimously approved the
Intern Monk. "Kingfa Technology Collective Wage Contract" to fully exer-
Democratic Communication cise their rights and protect their own interests. Meanwhile the representatives actively participated in discussions
provided suggestions for the Company's development and
The Company has established a systematic communication management system and created a multi-dimensional communica- fully communicated in the Trade Union's general elections
tion channel for "daily communication - appeal management - democratic participation" around the concept of "following proce- work reports and other aspects. This meeting built a bridge
dures respecting hierarchy and facilitating sincere interactions". The Company has built an employee appeal management plat- Collective Contract Reviewof communication between the Company and the employ-
form and constructed a rapid response mechanism to ensure that employees' reasonable suggestions are processed in time and ees' democratic communications enhanced the employ-
the employee participation and satisfaction were effectively improved. Through institutionalized platforms such as trade union ees' sense of belonging and responsibility and enhanced
members' and workers' congresses the Collective Contract has been concluded with employee representatives which has im- the Company's cohesion.proved the democratic management mechanism and effectively guaranteed the employees' rights to know participate express
and supervise. We conduct employee satisfaction surveys at least once a year to extensively collect the employees' opinions and
suggestions on working conditions salaries benefits career development etc.Remuneration and Performance
Grassroots shift meetings weekly semi-annual and an- Adhering to the philosophy of being "value creator-oriented" the Company has established a comprehensive remuneration and
nual meetings performance management system adopted a salary structure that combined basic salary with floating salary and made regular
adjustments based on market level and employee performance to ensure the internal fairness and external competitiveness of
the remuneration system. In terms of performance management we implement the "cake theory" and the job target responsibil-
ity system decomposed our strategic objectives for different positions step by step and guided the employees to focus on value
creation through scientific assessment and incentive mechanism in order to promote the efficient achievement of organizational
Questionnaire objectives.Communica- During the reporting period the Company continuously improved the management system related to the performance remuner-
tion channels ation revised the Performance Management Regulations Management Regulations on Performance Appraisal of Senior Manage-
ment and Internal Operations and other systems and established a performance management cycle system. If an employee raises
Online forum any objections to the performance appraisal results the employee shall communicate with the performance appraisal superior
first and no agreement can be reached an appeal may be made the HR Department. After receiving the appeal the relevant de-
partments will conduct investigation and evidence collection. If the appeal succeeds the performance responsibility of the superi-
or will be traced and assessed to ensure the fairness of the performance appraisal the rights and interests of the employees.Diverse communication channels
9596
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s
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ndKingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
1P erformance plan Equity Incentive Plan
As the starting point of the cycle the appraiser and the appraisee need to fully com-
municate and reach an agreement on the goals of a certain cycle in the future. The
goals of employees at different levels are presented in different forms. They shall The Company has implemented the employee stock ownership plan since 2016 drawn up the 2022 Restricted Stock
be consistent with the overall goals of the Company and dynamically adjusted with Incentive Plan (Draft) in 2022 and continued to promote the incentive plan during the reporting period. In August 2024
them. The goal setting shall comply with the SMART principle. After determination the Company repurchased the restricted stocks held by 1685 incentive objects and completed the cancellation.the immediate supervisor will guide the employees to draft a work plan and break
5 down the goals into specific tasks. 2 In November 2024 we reviewed and approved the Proposal on the Implementation of Equity Incentives for Whol-Performance interview Performance appraisal ly-owned Subsidiaries and the Company's Waiver of Preemptive Subscription Rights and Related Transactions made
and feedback
Performance interviews are divided into by Zhuhai Vanteque Specialty Engineering Plastics. Zhuhai Vanteque Specialty Engineering Plastics granted equity
performance planning interviews per- The superiors shall use scientific methods incentives to the Group's core employees through capital increase and share expansion which involved the Compa-
formance counseling interviews and per- to evaluate the subordinates' work against
goals and standards and set the appraisal ny's senior management key technologies collaborating with the business of Zhuhai Vanteque Specialty Engineering formance appraisal summary interviews.The performance planning interviews methods by positions and levels. The Com- Plastics marketing personnel core managerial personnel of Zhuhai Vanteque Specialty Engineering Plastics and core
guide the employee behaviors. The per- pany's senior management is assessed marketing personnel. 5 limited partnerships were established as the employee shareholding platforms.formance counseling interviews are con- Performance according to the target responsibility cer-
ducted regularly according to work nodes Management tificate. For the non-frontline employees The establishment and implementation of the personalized incentive mechanism and a series of supporting measures
or progress to improve the subordinates' Cycle engaged in the internal operation monthly
summary and scoring quarterly + annual have attracted numerous outstanding talents stimulated their passion and aspiration for the Company's development enthusiasm. The performance appraisal
summary interviews are conducted during assessments are performed. For the front- and injected everlasting vitality into the Company's development.the appraisal cycle or after the completion line employees the assessment plans
of the work for comprehensive review and shall be drafted by positions and the per-
evaluation laying a foundation for the formance evaluation rules are explained
next period of performance management. under special circumstances.
4 3 Employee WelfareApplication of performance results Performance communication and counseling
The assessment results are linked to employees' performance The superiors help the subordinates achieve their performance Being always professional and meticulous
bonuses salary adjustments position adjustments training goals through daily counseling and mid-term review. The daily in the construction of an employee welfare
development benefits etc. For the employees who fail to meet counseling is carried out for the problems in any form during system we are committed to providing all-
the annual performance standards the performance improve- the implementation of performance plan. The mid-term review
ment plan shall be initiated and those who fail to meet the is to formally review diagnose and counsel the subordinates round and multi-level welfare guarantee for Kingfa homeland
standards after the improvement period expires will be trans- at a specific time. The superiors shall record important perfor- our employees. During the reporting period
ferred or dismissed. mance facts. the Company revised the Welfare Management
Regulations Employee Retirement Manage- Consolidate the foun- Reflect the warmth Cohere the strength
ment Regulations and other systems to further dation of the "home" of the "home" of the "home"
improve the employee welfare management.Construction of "Kingfa Homeland Culture"
9798
Diverse Intensive Services
Welfare and Care System
10 Interest Associations
3000m2 Activity Venue
Party-mass Integrated Service CenterKingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
During the reporting period
Five social insurances and one housing fund Benefits and subsidies
The Company buys the "endowment insurance The Company provides the employees with various the Company cumulatively issued
medical insurance maternity insurance unemploy- benefits and subsidies including annual and quarter- benefits of RMB
ment insurance work-related injury insurance and ly benefits traffic subsidies and seniority subsidies.housing provident fund" for all employees. 85.4925 million
Supporting living and recreation facilities Improvement of academic qualification and training
The Company provides the employees with can- During the reporting period the Company built new gyms swimming The Company provides the employees with paid
teen dining services and multi-room dormitories as pools and golf rooms for the employees to do sports.training learning and improvement subsidies.benefits equipped with comprehensive land-based Employee activities
facilities and diversified cultural and entertainment
venues. Holiday care The Company has long been committed to optimizing the employees' spiritual and cultural life. Upholding popular small-scale
and routine activities we make innovations of our recreational and sports activities in form and substance according to local con-
The Company implements a five-day working week
Medical health ditions. During the reporting period we organized more than 228 activities to enrich our employees' amateur life increase our and the employees are entitled to maternity leave employees' enthusiasm for work and cohere the team spirit.The Company has set up an infirmary to provide marriage leave funeral leave annual leave and other
basic health diagnosis treatment and psychological holidays according to law.consultation services for the employees and annu- March 8 Festival Activities for Supporting the Female Employees' Growth and
ally arranges free physical examinations for the em- Family care Development
ployees. The Company encourages the employees to bring In March 2024 the Company organized a range of "March 8 Women's Day" activities which reflected the Company's
their children and other immediate family members
Support for difficulties care for the female employees and helped the female employees achieve continuous growth and shine in their life to live with them provides services for the custody and work.We attach great importance to the lives and families schooling pickup and dropoff introduces kindergar-
of our employees in need. We have set up a special tens and sets up free school bus lines. We carried out the sharing of National Clothing Culture and
fund to support the employees in need and apply Social Tasting to help the female employees enrich their cul-
for support fund for our employees who can hardly Rights and interests of the female employees tural knowledge and improve their self-cultivation.obtain loans or suffer from critical diseases or whose
Paying attention to the female employees' rights and We performed the training program named Parent-child Emo-
families face difficulties in applying for loans.interests the Company has formulated the Regula- tional and Psychological Nourishment to help the employees
tions on Labor Protection and Management of Fe- handle parent-child relationships and improve themselves.Holiday benefits
male Employees. We have set up nursery rooms and We organized our female employees and their family mem-
The Company provides birthday gifts for the em- green channels for the pregnant women to dine and bers to watch the movie known as YOLO together to draw on
ployees annually sends consolation money or Thematic activity for the Women's Dayimplemented other measures to care for the female "her strengths".condolences for the Spring Festival Mid-Autumn employees.Festival and anniversary celebrations and organiz-
es abundant recreational activities during holidays. Convenient transportation
st
The Company provides the employees with free The 31 Anniversary Hiking Event Cohering the Blonde Spirit
shopping buses shuttle buses for commuting and
welfare vehicles. In December 2024 in order to celebrate the 31st anniversary
of its establishment the Company carried out a hiking event
where four routes with a distance of 5km 10km 20km and
Dispatch benefits 31km were set up representing different challenges and dif-
The Company provides overseas subsidies overseas ficulties especially symbolizing the Company's major time
foreign language subsidies family visit holidays over- nodes. A total of more than 200 employees completed this
seas insurances and other benefits for the overseas hiking which fully demonstrated the spirit of the Company's
employees. employees who were full of vitality perseverance unity and Hiking Event
cohesion and further gathered the Company's strength.
99100
Employee Welfare and Care SystemKingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Employee Training and Development Adhering to the employment principle of "attaching During the reporting periodequal importance to integrity and talent and employing
one's talent to the fullest extent" the Company has con- the Company annually provided the employees with mil-
structed a "management + professional" dual-channel
The Company has continuously optimized its talent development system created a multi-dimensional career development chan- lions for the employees to improve their academic educa-
promotion system and job rotation mechanism to create
nel for the employees built a competency model for the talents established a systematic training management system improved tion and financial subsidies for further study in the insti-
a multi-dimensional career growth path for the employ-
the construction of teacher pool and curriculum development constantly enriched internal training resources effectively im- tutions of higher learning to encourage the employees to
ees. Based on the quality model and job qualification
proved the employees' professional and job competencies and provided solid talent support for the Company's development. constantly improve their professional knowledge.requirements we have established differentiated and
reasonable career promotion standards to drive talents
Employees' Career Development and corporate strategies for symbiosis and joint growth.The Company has established a fair transparent internal promotion mechanism clarified the development path promotion Organization of Employee Training
standards and ability requirements of the channels provided the employees with clear career development directions and expec-
tations and encouraged the employees to obtain promotion opportunities through hard work and outstanding performance in Regarding talent training as an important part of its sustainability strategy the Company created a stepwise training structure
order to achieve personal career growth. through the "TOP Plan - Eagle Series -Creation Series - Sword Series - Shield Series" covering core areas such as leadership devel-
opment technological tackling and market development. We implemented the "Young Eagle Plan" "Integration Series" special
Around the "1438" strategic goal for 2030 and based on the needs of the business units the Company has integrated the talent training for the new generation and foreign employees respectively to strengthen the global adaptability of the talent pool. During
strategies from the perspective of marketing technologies domestic and overseas operations. We have set the employee devel- the reporting period the Company optimized seven training systems focusing on improving the compliance management sys-
opment vision of "attracting global outstanding talents activating individuals improving organizational capabilities becoming a tems such as the Management Regulations for Labor Ethics Training formulated employee training and assessment indicators
world-renowned employer brand and guaranteeing our realization of the "1438" strategic goal by providing a high-quality talent and realized the dual-track linkage between the training evaluation and the performance appraisal. It not only protected the
supply chain". The Company is committed to fulfilling the core tasks for increasing its talent adequacy ratio organizational efficien- employee rights and interests in development but also formed a talent supply chain at the strategic level supported cultural inte-
cy and organizational fit to guarantee the talents' career development. gration and production technology needs in overseas operations and provided long-term development momentum for business
development.Level of talent competency Personal empowerment Internal empowerment Worldwide development
As of the end of the reporting period
Continuous innova- Collaboration and the Company created compiled learning maps for and produced
Customers first;
Core competencies tions; loyalty to the cooperation; effi-
striving spirit
organization cient operations 20 series of job training 47 development channels 1180 courses
Inspire others During the reporting period
Customers' foremost Shape organizational Strategic thinking
Top leadership
striving spirit capabilities Resolute decision-making a total of and the employees' total training hours were Each employee received training of
Lead transformation 13083 employees 583501.8 hours 44.6hours on average
were trained by the Company
Empower the teams
Strategic integration
Middle leadership Strive for excellence Manage target plans
Operational awareness The Company has built "Kingfa e-En-
Drive execution terprise Learning" platform. Through
the organic collaboration of the digital
learning ecosystem and a series of proj-
ects such as "TOP/Eagle/Creation" we
have created a sustainability cultivation
Intrinsic motivation Team management
Bottom leadership system covering the entire employee Resilient growth Problem analysis and Professional influence
lifecycle empowering the symbiosis and
EQ solving
joint growth of the talent value and orga-
nizational strategy.Talent Competency Model
Kingfa e-Enterprise Learning
101 102Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
The Company has established an internal lecturer training system to effectively accumulate and inherit organizational wisdom
through systematic learning and a certification mechanism for lenient entry and strict exit. As of the end of the reporting period
148 employees of the Company passed the junior instructor certification and 49 employees passed the intermediate instructor cer-
tification providing endogenous motivation for the construction of a sustainability talent system.Employee Training
Reserved middle management training program for enhancing leadership Fresh graduate training program for supporting the newcomers' growth
In 2024 the Company launched a one-year reserved mid- In 2024 the Company performed a half-year training program for the fresh graduates to facilitate the newcomers' rapid in-
dle management training program. In December trainees tegration and growth. At the beginning of the project the newcomers were received by the Company to let fresh graduates
from all over the country participated in the final training. feel warmth. Subsequently team building was carried out to hone their will and enhance their teamwork skills. The cultural
A professor of Shanghai Jiao Tong University shared the edification session was arranged to help them understand the Company's values and culture. During the grassroots train-
course titled Operations Management to help students ing the fresh graduates went deep into the front line to accumulate practical experience. The project research procured the
achieve efficient operations under a changing business fresh graduates to use what they had learned to analyze and solve problems. In the post-based teaching the tutors offered
environment. The next day the students participated in guidance to improve professional skills. This project effectively cultivated the fresh graduates' abilities and injected young
the knowledge and skills assessment. All of them passed blood into the Company.the written examinations and 19 students achieved excel-
lent results. At the end of the training camp international Training Program for Fresh Graduates
business etiquette courses were opened to pave the way
for the Company's global development. This training
camp effectively improved the trainees' knowledge and Newcomer reception Team building Cultural edificationSeminar "Combined Training and Combat: Case Study
abilities and reserved outstanding middle-level talents for on Operations Management of Kingfa (Europe)"
the Company.Overseas "Integration Series"
To deepen the implementation of the globalization strategy the Company launched the "Integration Series" cross-cultural
empowerment project initiated the overseas training camps for operation backbones and marketing elites respectively
opened core courses such as Kingfa Globalization Strategy and Overseas Business Layout and Cross-cultural Collaboration
Mechanism around three dimensions namely strategic synergy cultural integration and management efficiency improve- Topic research Grassroots training
ment and organized field studies and corporate culture competitions in the manufacturing bases to strengthen overseas
teams' deep recognition of corporate vision and strategies. The training covered the foreign employees from 10 countries
improved cross-cultural communication skills localized management awareness and provided governance efficiency
support for building a multicultural inclusive sustainable talent supply chain.Post-based teaching Competition for and fixed posts
Overseas Employee Training for Improving Marketing Elite Cultures Foreign Operation Employees' Visit to Qingyuan Factory
and Business Capabilities in 10 Countries in April 2024 for Study in November 2024
103 104Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Occupational Health and Safety Indicators and Targets
Our occupational health and safety work has always been carried out based on the management concept that "safety is essential for
survival" and the work principle that "production and life safety is the top priority". We pay attention to the management policy of "al-
ways placing an emphasis on prevention paying attention to employee health ensuring personal safety preventing and controlling Health and safety objectives Progress of the objectives
environmental pollution and remaining committed to sustainable development". To comply with the national laws and regulations
which is reckoned as a basic requirement for the purpose of "zero accidents" and in reliance on the Group's management system From 2022 to 2030 ensure annual "0" work-related death and the cover-
standards the Company has continuously improved the system construction strengthened the process control performed the main age rate of 100% in the physical examination. Achieved
responsibilities carried out regular assessment effectively improved the occupational health and safety and ensured the orderly de-
velopment of production and operation activities through the risk control mechanism safety evaluation system Group supervision From 2022 to 2030 ensure that the annual health and safety risk assess-ment covers 100% sites. Achieved
assessment etc. as well as the safety evaluation index system. During the reporting period the Company and its 14 subsidiaries or
production bases passed the ISO 45001 Occupational Health and Safety Management System Certification.The Company's health and safety data during the reporting period is shown in the following table:
Governance and Strategies
The overall occupational health and safety work of the Company is controlled by the Group led by the Work Safety Committee of Unit 2024
the Group in a coordinated manner. The work safety committees of the subsidiaries perform territorial management in accordance
with the national laws and regulations technical safety standards and our management system standards. We have established a Occupational health and safety investments RMB 10000 526.18
safety management network at four levels namely "Group-subsidiary-department-team". Improve the safety literacy and skills of Work safety investments RMB 10000 7650.92
all employees by improving the safety management system sharing work safety experience promoting intrinsic safety improve-
ment strengthening emergency response capacity building and practicing safety management culture. Number of major work safety incidents / 0
The Company strictly implements the principle of "three managements and three musts" (business/industry/production and op- Number of general work safety accidents / 0
erations management with safety management required) the responsibility system for identifying "whoever in charge is responsi-
ble" and performance linkage appraisal. The Safety Committee of the Group has formulated the annual Letter of Responsibility for Incidence of occupational diseases % 0
Work Safety set up a quantifiable safety responsibility assessment system (including result and process indicators) and performed
safety responsibilities step by step through the closed-loop mechanism of "target decomposition - process supervision - result ap- Serious work-related injuries Persons 0
plication" towards the general managers department heads and grassroots teams of all subsidiaries. Directly link the assessment
results to the year-end performance and the annual merit-based evaluation in order to realize the coverage of all employees' re- Work safety inspections Times 881
sponsibilities. Rectification rate of hidden safety hazards % 93.2
Safety Production Training Times 1320
tem for O
ccupatio
" Sys
nal Hea
y lth an Person-times of work safety training Person-times 37823
ane
it d
t Sul
afet
-si
m y Fa Work safety drills Times 276
ee c
02 Employee coverage of safety drills % 99
0103
Note: Major work safety accidents and general accidents are distinguished by casualties and property losses according to the Regulations on Safety
Accident Reporting Investigation and Handling.Design of facilities for
protecting against
Pre-assessment of occu- occupational diseases
pational hazards Effectiveness evaluation of control over occupational
Design of safety facilities hazards
Safety pre-assessment
Safety assessment upon
completion
105106
"Thr
es
ilit
iKingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Occupational Health Protection
The Company complies with the Law of the People's Republic of China on the Prevention and Control of Occupational Diseases other The Company regulates the management of infectious diseases publicizes the basic knowledge about the infectious diseases
relevant laws and regulations. We prepare and strictly implement occupational health protection system documents including the increases the employees' awareness of self-health care and disease prevention prevents controls and eliminates the occurrence
Regulations on the Management of Occupational Health Safety and Environmental Protection to protect our employees' safety and and prevalence of the infectious diseases in the Company and protects the employees' health. When suspicious symptoms of the
health in the production process and effectively prevent them from suffering occupational diseases. infectious diseases or related patients are found the Company will take necessary protective measures immediately isolate and
When entering into the labor contracts with the employees in positions exposed to occupational hazards the Company truthfully send them to hospitals for diagnosis and treatment discover and manage the sources of infection in time cut off the channels of
informs the employees of the hazards they might be exposed during work and their consequences measures for protecting against transmission and avoid cross-infection. The Company performs chemical disinfection and prepares standardized operation ta-
the occupational diseases and benefits. The employees are informed ahead of the job risks and clearly specify that no concealment bles for common disinfection of daily necessities to guide the actual disinfection work and reduce the spread of infectious viruses.or fraud is allowed. For the on-the-job employees the Company selects an occupational health examination institution after compre-
hensive consideration of its qualification medical standards experience in occupational health examination facilities internal and
external environment price and traffic accessibility. We organize physical examinations according to our production characteristics
and the occupational hazards existing in the positions of employees in with reference to the national occupational health monitoring training for the first aid personnel
standards. Besides we continuously observe and manage our employees' physical examination results.In August 2024 Zhuhai Vanteque Specialty Engineering Plastics invited lecturers from RED CROSS SOCIETY OF
Pre-job On-the-job Post-employment Emergency CHINA ZHUHAI BRANCH to conduct two-day off-the-job emergency rescue training for 30 employees. The lecturers
Arrange occupational health Annually arrange occupa- Arrange health examinations In case of any emergency taught professional rescue knowledge and skills and the employees actively learned. In the end all 30 trainees ob-
examinations for the em- tional health examinations for the employees before they that endangers the employ- tained the emergency rescue personnel certificates. Through training the employees mastered emergency rescue
ployees who are about to for the employees according are transferred away from or ees' health immediately or- skills and placed more emphasis on occupational health.go on duty (including those to national regulations on a get away from the operations ganize health examinations
subject job transfer) with regular basis. exposed to occupational haz- for the employees working
respect to the potential haz- ards or in front of their posts in the same workplace an-
ards they might be exposed in order to confirm their alyze the cause of the acci-
in their posts according to health status when they are dent draw up solutions and
the post characteristics. suspended from exposure to a solidification plan and re-
the occupational hazards. inforce occupational health
and safety management.Categories of Occupational Health Examinations
The Company pays attention to the employees' occupational health and safety carries out pre-job and on-the-job occupational
health training for them popularizes knowledge about occupational health and urges the employees to abide by laws regula-
tions rules national occupational health standards and operating procedures for prevention and control of occupational diseas-
es. For the employees in positions exposed to serious occupational hazards special occupational health training will be carried
out and the employees will be allowed to perform operations in their posts only after they have passed the training. The Company
has posted occupational hazard notification cards and bulletin boards in all workplaces to inform the employees of occupational
hazards in the workplaces preventive and control actions and systems. Each base branch and subsidiary regularly monitor the
occupational hazards in the workplaces and announce the test results to the employees. The Company provides sufficient and
conforming personal protective equipment for all employees exposed to the occupational hazards.On-site Learning
Set up an occupational health management
organization with occupational health manage- Formulate and improve occupational health manage-
ment personnel to be responsible for the pre- ment systems and operating rules.vention and control of occupational diseases.Establish and improve the systems for monitor- Provide the employees exposed to occupational haz-
ing and evaluating occupational hazards in the ards with personal protective equipment up to the na-
workplaces. tional standards.Draw up plans for prevention and control of oc- Create and improve files on occupational health and
cupational diseases and implementation plans. laborers' health monitoring.Draft and improve the emergency rescue plans Set up corresponding warning signs and occupational
for occupational hazards and accidents. health bulletin boards in THE workplaces that produce or have occupational disease hazards.Free Clinic and Health Lecture for Supporting the "Hundred-Thou- Mental Health Training for the Employees
sand-Ten Thousand Talents Program"
107108
Management Measures for
Prevention and Control of
Occupational DiseasesKingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Protection of Work Safety Safety Training and Drills
In terms of work safety we have always adhered to the concept that "safety is essential for The Company implements full coverage of safety education requires the During the reporting period
survival" and the policy of "safety first prevention foremost full participation and com- employees to study conscientiously and strictly abide by various rules and
During the reporting period prehensive governance" to ensure the employees' personal safety. We ensure the smooth regulations and enhances their awareness of safety work without violating
progress of production and business activities by improving our system construction labor disciplines operating in violation of regulations or giving commands
strengthening our process management performing our main responsibilities and con- the average time for online safety
a total of in violation of regulations in order to avoid accidents to the greatest extent. ducting regular assessments. training for employees was up toThe new employees must pass the orientation training and assessment
276 safety emergency During the reporting period the Company improved the Safety Inspection Hidden Danger on safety and the incumbent employees must receive safety re-education 110 hours per capita
drills were organized by the Investigation and Governance System classified hidden dangers into hidden dangers of every year. The management supervisors professional and technical engi-
Company according to its general and major accidents by their hazards and rectification difficulty and completed neers shall receive safety training before their promotion and may be pro-
annual plan the closed-loop rectification assessment in time. moted or appointed only after passing the assessment.Safety Inspection and Hidden Hazard Investigation Methods
including
189 Daily Comprehensive Professional Seasonal Content of safety traininginvestigation investigation investigation investigation
on-site emergency plan drills Previous accident cases of the Company and those related to the appointment for this post; procedures
Investigation Investigation Diagnostic and requirements for handling the emergencies
before key Investigation of before produc- investigation
periods and accident types tion and work by an external
66 holidays resumption expert Work safety laws and regulations Safety procedures and require-
special emergency plan drills as well as relevant standards ments of the Company includ-
To strengthen the Company's emergency response capability and speed the Company applicable to the Company ing work safety prohibitions
has formulated emergency response procedures such as the Management Procedures for
and Risks Opportunities and Emergency Preparedness and Response Plans to ensure that var-
21 ious emergency plans can be implemented in time and effectively in case of emergencies minimize casualties and property losses and ensure the safety of the employees' lives. The evaluation is performed after Discuss the hazards existing in
comprehensive emergency the training and a closed-book the areas of new posts where
plan drills for work safety examination is arranged. The appointment remains to be
accidents Fire emergency Drills for Strengthening Safety Guarantees exam paper consists of choice performed or that the person-
questions and short answer nel to be appointed for these
In November 2024 our petrochemical segment teamed up with the Manage- questions or case analysis. The posts will be exposed and
ment Committee of Liaobin Economic Development Zone the Fire Rescue minimum passing score is 80 some major controls
Brigade and multiple professional fire brigades to carry out an emergency
response drill for the Acetone Storage Tank Leakage and Fire Accident mobi-
lizing 18 fire trucks and 80 commanders and fighters to participate. The drill
focused on five professional units such as communication command fire
extinguishing cooling and airlift jet. A number of practical programs were
performed on UAV and robot detection foam fire extinguishing tactics chem-
ical decontamination and emergency avoidance. This drill tested the park's Safety knowledge competition for enhancing safety awareness
ability to make collaborative responses to sudden hazardous chemical acci-
dents improved the government-enterprise linkage efficiency and emergency
In December 2024 Zhuhai Vanteque Specialty Engineering Plastics orga-
response and achieved good results.nized 14 participatory teams represented by departments to carry out the
first 100-day safety and accident-free knowledge competition. The Compa-
ny created a specialized examination questions database with more than
8 categories and 500 questions which covered knowledge about multiple
fields including safety and environmental protection. The employees
actively participated in answering questions. This competition effectively
popularized safety knowledge increased the employees' safety awareness
promoted the construction of corporate safety and environmental protec-
tion culture and helped improve the overall safety management. Safety Knowledge Contest
Drilling Site
109 110Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Rural Revitalization and Social Contributions Data Security and Customer Privacy Protection
The Company actively performs its corporate social responsibilities re- During the reporting period The Company deeply realizes the importance of information assets adopts a series of strict comprehensive measures to ensure
sponds to the national rural revitalization strategy and remains committed data integrity and confidentiality and creates an information security defense line in order to create a safe and reliable digital en-
to promoting social equity and common prosperity. Through charitable vironment for the customers and fully protect customer privacy.donations and project assistance we continuously increase our invest- the Company's social welfare donations
ments in the rural revitalization to facilitate the economic development (including rural revitalization donations)
and improve people's livelihood and ecological construction in pover- totaled Data Security Protection During the reporting period
ty-stricken areas. In the future we will continue to implement our national
The Company systematically improves the information
rural revitalization strategy further increase our investments in the field of RMB 2.383 million security management system. During the reporting peri- the Company conducted and the information security risks
rural revitalization explore diversified innovative models such as industrial
od we revised the Information Application Management 62 identified in the security audit wereassistance ecological protection and cultural revitalization facilitate rural Regulations and added the Requirements for Supply information
economic development ecological protection and social progress and
Chain Information Security Management to ensure the security audits 100% rectified
make contributions to the goal of common prosperity.security of information systems and data.Consolidating the achievements in poverty alleviation Revitalizing rural economy and building a
and laying a solid foundation for development beautiful homeland together Data security protection measures
Assisted with the infrastructure construction: Donat- Lvmei Qingyuan Project: Donated RMB2 000 Risk assessment Risk assessment and reclassification of data are carried out annually to ensure the pertinence
ed RMB 50000 to the solar street lamp construction through Guangyi Joint Fundraising Platform to and effectiveness of data protection measures.project in Huanggang Village Shigu Town Gaozhou support the regional ecological and environmental
City to improve local infrastructure and the villagers' construction in Qingyuan and facilitate the green Quarterly arrange information security engineers for vulnerability scanning penetration test and
living standards. development of rural areas. weak password inspection on the intranet. Output scanning results and rectification require-
Vulnerability scan- ments. Follow up on and review the reinforcement measures. Finally summarize all inspections
Promoted common prosperity: Donated RMB 250 Community Charity Fund support: Donated RMB ning and fixing reinforcements and tracking. Prepare a summary report and announce the completion of the
000 to support the Beilun District "Common Prosper- 5000 to support Wuhan Liaojiabao Community work internally. During the reporting period the Company discovered 611 system vulnerabilities
ity Happy Home" charity fund supported the devel- Charity Fund to promote the harmonious develop- and completed all repairs.opment of charity in Beilun District and promoted the ment of the rural society.realization of the goal of common prosperity. Ecological protection of the Yangtze River: Donated Construct an access control and privileged account management system. The information securi-
RMB 50000 to support Hubei Yangtze River Eco- Access permis- ty engineers conduct behavioral audit on the account permissions of product managers adminis-
sion settings
logical Protection Foundation promote ecological trators and external consultants. During the reporting period the security access control over the subsidiaries' new servers only allowed the access through a bastion host.environment protection in Yangtze River Basin and
assist with rural ecological revitalization.During the reporting period we completed performed special security protection for 10 domestic
Software and bases added 6 firewalls 2 network access systems 2 network threat detection systems and 3
equipment online behavior management systems. The anti-virus software of the terminal computer fully cov-
ered those that met the installation conditions.Encrypt data for storage and transmission to ensure the data confidentiality and integrity. Any
Document
encryption decryption requirements must be submitted through the internal OA system and the decryption
operation can only be performed with approval.Data backup Perform regular backup and recovery tests on important data to ensure data reliability and availability.We have formulated the Equipment Network Access Management Specifications to specify the
Equipment
network access procedures for application approval use and change of equipment network access require office
specifications computers to be installed according to standards and private computers to follow specific rules
for network access and punish violations.According to the Information Security Management Regulations employees or departments mak-
Reward and punish- ing valuable suggestions implementing improvement measures or performing well in handling
ment mechanism incidents in information security work are rewarded and information security violations are pun-
ished.
111 112Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
To improve our ability to make emergency responses to information security incidents strengthen the information security guar-
antee work and form a scientific effective and responsive emergency work mechanism we have drafted the Emergency Plan on
Information Security according to the Management Measures for Internet Information Services Management Measures for Com-
puter Virus Prevention and Control other relevant laws and regulations set up an information security emergency organization
standardized emergency response procedures ensured the physical security operation security and data security of important
company information systems and minimized the harm of information security emergencies.Information security emergency organization
Emergency organization Personnel composition Information Security Training for New Information Security Training Information Security Training for
Employees for Key Groups Overseas New Employees
Level 1 incidents: CEO CIO general managers of bases
Emergency
response Level 2 incidents: head of the Information Department heads of departments related to Confidentiality of Material Information
leading application systems
group of the
Company Level 3 incidents: head of the Information Department heads of departments related to The Company has formulated the Confidentiality Management Regulations which stipulate that internal confidentiality-related
application systems employees and external personnel shall enter into confidentiality agreements to ensure that sensitive information is not disclosed
and the information security of the Company is guaranteed. In addition the Company has also formulated and strictly implement-
ed the Management Specifications for Major Meetings and the Management Specifications for Meeting Safety to ensure smooth
Level 1 incidents: head of the Information Center supervisors relevant module team lead- progress of important meetings confidentiality and security of meeting information.Emergency ers director of the Confidentiality Office confidentiality commissioner
response team Level 2 and 3 incidents: related supervisors of the Information Center related module
team leaders
Customer Privacy Protection
The Company complies with the relevant laws and regulations on privacy protection regulates and manages the collection stor-
External age and use of personal data and ensures the data security and legality of data. In addition we require our employees not to dis-
liaison Supervisors of the Information Center security team leader
officers close customer information or other personal data to unauthorized third parties in order to ensure the confidentiality of customer
information and other personal data. During the reporting period there was no customer privacy leakage incident. During the
reporting period no customer privacy was disclosed in the Company.The Company has formulated the Management Measures for Information Security Training to conduct annual information security
awareness training for new employees and the employees in key positions such as finance procurement sales and IT to increase
their awareness of the Company's information security strategies evaluate the training effectiveness and adjust the training plan
and content. The Company also requires the suppliers to conduct information security awareness training for all employees at
least once a year to ensure that they understand the Company's information security policies and regulations. A perfect DLP system has been Implement data desensitization and
During the reporting period established. All documents are anonymization to protect customer
circulated in an encrypted state privacy.the Company organized and achieved and outgoing applications need to
be decrypted or passed through the
22 training sessions related full coverage of key personnel Company's mailbox. Customer pri-
to information security vacy protec-
tion measures
Among them a total of Encrypted storage is performed Establish the roles of the audit man-8 orientation training 2 information security for the database. agers to conduct regular audits on 10 information security training sessions sessions on information security training sessions for key data usage query and download.were organized for branches and subsidiaries for the new employees personnel
1 information security training session and Strictly manage permissions and grant authorities to the positions to the minimum extent.
for middle and senior management cadres 1 information security
above the ministerial level training session for overseas employees
113 1140Resp3ons ibility
for Governance
Committed to building an efficient governance structure for the
shareholders' meeting the Board of Directors and the Board of Su-
pervisors the Company ensures the transparency and compliance
of corporate governance through a range of measures. The Compa-
ny has optimized the information disclosure process and strength-
ened risk management to improve governance efficiency and
effectiveness. In addition the Company firmly adheres to business
ethics upholds the principle of integrity management and jointly
creates an equal competitive environment with its stakeholders.Highlighted results
Convened 11 meetings of the
4 general meetings of Board of Directors
shareholders
and The information disclosure
work was evaluated as Class
7 meetings of the A
Board of Supervisors
Completed a new-round management re-election
SDGs benchmarking
115 116Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Operation by the Board of Directors the Board of Independence and Diversity of the Board of Director
Supervisors and the General Meetings of Shareholders The Company attaches great importance to the independence of the Board of Directors. We have
formulated and regularly revised the Independent Director Work System. The Company attaches
The Company has established a sound system for the operations of the three boards and continuously regulates the operation and de- great importance to the plurality of independent directors in the Board of Directors and its spe-
cision-making of the general shareholders' meetings the Board of Directors and the Board of Supervisors so as to ensure efficient co- During the reporting periodcial subordinate committees and ensures independent operations of the special committees
operation checks and balances among the authorities decision-making and supervisory bodies. In order to protect the legitimate rights so as to strengthen the fairness of the Board of Directors' decision-making and protect the legiti-
and interests of the shareholders and creditors and standardize its organization and operation in 2024 the Company revised the Rules of the Board of Directors consisted ofmate rights and interests of the shareholders.Procedure for the General Meeting of Shareholders Rules of Procedure for the Board of Directors Remuneration Management System for
Directors Supervisors and Senior Managers Articles of Association and other governance documents and disclosed them on the website While emphasizing the independence of the Board of Directors the Company also attaches great 11members
of Shanghai Stock Exchange (www.sse.com.cn) and its own official website. importance to the diversity of the Board of Directors. Sex age professional background and
other dimensions have been considered in nominating directors for the Nomination Committee.The Company believes that directors with diverse backgrounds may help the Board of Directors
General Meeting of Shareholders better supervise its management and operations evaluate the risks and opportunities of its 4 of whom were independent
business model from different perspectives and promote its formation of an equal inclusive and
Board of directors
Supervisors open culture.Board of Directors Diverse Backgrounds of the Members of the Board of Directors All members of the Audit
Committee were independent
Secretary of the directors
Board of Directors
Name Age Gender Current Incumbency of the position committees Major Either the Audit Committee
Nominating Remuneration and Strategy and Sustain- the Nomination Committee
Committee Evaluation Committee ability Committee Audit Committee
Chen 42 Male Chairman Strategy and Sustain- or the Remuneration and Pingxu ability Committee Appraisal Committee had
Director Vice
Board of Directors of the Company Yuan Chairman
Chang 41 Male Executive Nominating Committee 3 members
chang Deputy Gen-
General Meeting of Shareholders eral Manager
Remuneration and
In accordance with the Company Law the Rules of Procedure for the Meet- During the reporting period Wu Di 40 Male Director Gen- Appraisal Committee
2 of whom were independent
ing of General Shareholders of the Company and the Articles of Association eral Manager Strategy and Sustain- directors
the shareholders' meeting of the Company shall perform the procedures for ability Committee
convening/holding the meetings and voting according to law. As the highest Ning The Strategy and Sustainability
authority of the Company the general meeting of shareholders is mainly the Company held at which a total of Hongtao
51 Male Director
Committee had
responsible for decision-making over major issues of the Company super-
vising corporate governance safeguarding the right of all shareholders to Chen Director and 40 Male Deputy Gen-
attend the meeting providing sufficient consultation channels for the share- 4 general 27 motions Niande 5 memberseral Manager
holders and ensuring the open fair and just voting. meetings of shareholders were considered
Director and
Li Peng 43 Male Deputy Gen-
Board of Directors eral Manager 3 of whom were independent
Li directorsOur Board of Director strictly performs the duties for lawfully deciding on Hua 43 Male Director
our major business decisions and investment plans of the Company and for- xiang
mulating our basic management systems in accordance with the Company 11 Board of Directors meetings at which
Law the Rules of Procedures for the Board of Directors of the Company and Yang 58 Male Independent Audit Committee
the Articles of Association. The Board of Directors has set up four special Xiong director
committees to provide professional advice and support for its scientific de- a total of 50 motions were considered Nomination Commit- Polymers
cision-making. Meng Independent tee Remuneration and Yue 61 Male director Appraisal Committee zhong Strategy and Sustain- EconomicsBoard of Supervisors ability Committee
Management Science
Our Board of Supervisors lawfully performs its supervisory duties in strict Remuneration and
compliance with the Company Law the Rules of Procedure for the Board of and 7 Board of Supervisors meetings at Zeng Independent Appraisal Committee Xing 62 Male Strategy and Sustain- Finance
Supervisors of the Company and the Articles of Association. As a body that rong director ability Committee Audit
supervises the corporate governance the Board of Supervisors carries out which a total of19motions were Committee Law
supervision by convening regular meetings and reviewing reports and on- considered
site inspections. It performs its duties for supervising and inspecting the Nomination Committee Zhang Independent Audit Committee Strat-
performance of duties by our directors and senior management as well as Jicheng 48 Male director egy and Sustainability
our financial affairs in order to effectively safeguard our and our sharehold- Committee
ers' legitimate rights and interests.
117 118Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Governance Optimization Remuneration and Equity Policies
The Company completed the new-round management re-election in May 2024 turning the founding team to a team of profession- The Company adopts a salary structure of " annual base salary annual performance pay and long-term incentives". We have estab-
al managers making the members of the Board of Directors younger systematically adjusting the corporate governance structure lished a benefit and risk-sharing mechanism for our shareholders management and business backbones. Besides we implement
and further optimizing the decision-making mechanism and management efficiency. an equity incentive plan for all employees to encourage our managerial personnel technical business and operation backbones
who satisfy the incentive conditions.Management specialization Enhanced market competitiveness Restrictions on shareholder transactions
The Company turned its founding team into a The new members of the Board of Directors in- If the directors supervisors senior managers and shareholders holding more than
team of professional managers and made the troduced innovative business models and market 5% of the shares sell the Company's stocks or other equity securities within 6 months
members of the Board of Directors younger. We strategies so that the Company became more after their purchase or purchase them within 6 months after selling the proceeds
introduced new professional knowledge and advantageous in the market competitions. therefrom will be owned by the Company.market experience thus improving the efficiency
and quality of decision-making.Exceptions
Except for the circumstance that a securities company holds more than 5% of the
Innovation and change promotion Improved brand image shares due to the purchase of the remaining shares after the package sale and other
The younger Board of Directors was more willing The optimization of corporate governance circumstances stipulated by the China Securities Regulatory Commission.to accept new technologies and ideas which pro- structure and the management specialization Equity
moted the continuous innovation of our products attracted more value investors and partners and Policies
and services. improved our brand image. Execution by the Board of Directors for the
The Board of Directors shall implement the above provisions. Otherwise the share- Company's
holders have the right to request the Board of Directors to implement the provisions Directors
within 30 days. Supervisors
Optimized corporate culture Enhanced risk management capacity and Officers
The new directors made our culture more open The team of professional managers was more Shareholders' right to file lawsuits
and inclusive stimulating the employee motiva- capable of risk identification and management If the Board of Directors fails to execute within 30 days the shareholders have the
tion and creativity. which helped the Company maintain its stability right to directly file a lawsuit with the people's court in their own name for the bene-
in market fluctuations. fit of the Company.Higher shareholder value
With the optimization of corporate governance structure and performance improvement the share- Directors' responsibilities
holder value increased while the shareholder satisfaction and loyalty were improved.The responsible directors shall be jointly and severally liable according to law.Conflicts of Interest
For details of the remuneration policy and remuneration of the directors supervisors and officers during the reporting period
The Company will always uphold the principles of fairness and transparency avoiding any behaviors that might lead to conflicts please refer to Section IV - Corporate Governance of the 2024 Annual Report.of interest. Ensure that all employees and partners can identify and report the conflicts of interest in business activities by estab-
lishing a sound conflict of interest management system. In addition the Company enhances its employees' awareness of and
alertness to the conflicts of interest through training and education and ensures that the employees can consciously abide by the
Company's policies on the conflicts of interest.We strictly abide by the relevant laws and regulations of related party transactions in the place of listing and prohibit our directors
supervisors and other senior managers from harming our and our shareholders' interests through related party transactions. The
interested directors need to voluntarily declare and abstain from voting. In addition the Company strengthens the supervision and
review of related party transactions requires the independent directors to perform their duties and supervises the potential major
conflicts of interest among the controlling shareholders actual controllers directors and senior managers of its subsidiaries in
order to urge the Board of Directors to make decisions in line with the overall interests of the Company and protect the legitimate
rights and interests of minority shareholders. For details of the Company's related party transactions during the reporting period
see Section 10 - Financial Report "Related Parties and Related Party Transactions" in the Annual Report 2024.
119120
120
Positive Impacts of the New Management on the CompanyKingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Transparent Disclosure Investor communications
The Company strictly obeys the Measures for the Administration of Information Disclosure by Listed Companies ensures the trans- The Company annually organizes publicity During the reporting period
parency of information disclosure and protects the rights and interests of its investors and stakeholders by formulating the Infor- activities for the Investor Protection Day
mation Disclosure Management System and the Investor Relations Management System. The Company objectively and completely on May 15. The investors are organized to
the Company participated in
displays its performance in ESG and builds a good image around the information demand related to the investors' decisions and visit and communicate with the Company
by fully considering the correlations between the present and past information. from time to time. Meanwhile the Company 46 strategy meetings
provides the investors with diversified com- organized by the securities firms
munication methods so the investors can
Information disclosure keep informative about the Company's latest
information through communication chan- held
A transparent and standard information disclosure mechanism is essential nels such as strategy meetings with securities
for the Company's smooth communications with its investors regulators and firms corporate performance briefings in- 4 performance briefings
other stakeholders. The Company truly accurately completely timely and vestor surveys hotline email E-Interactive
fairly discloses the matters related to its operation and governance through and investor relations portal of the official
regular and interim announcements strictly performs its information disclo- website. The relevant persons in charge of and carried out
sure obligation as a listed company and protects the legitimate rights and the Company promptly sort out and respond
interests of its investors and stakeholders. to the investors' questions actively commu- 11 investor research
nicate with the investors and effectively im- and exchange activities
The Company designates the media announced by China Securities Regula- prove the relationship between the Company
tory Commission and the website of Shanghai Stock Exchange that meet the and its investors.conditions for information disclosure in the securities market as the media
for publishing its announcements and other information that need to be dis-
closed. In addition a special investor relations column has been set up at our
website to update important announcements in real time to ensure that our
investors and stakeholders can have easy access to our key information accu- Inviting the Investors to Conduct On-site Research to Boost the Investor Confidence
rately through authoritative and official channels.In 2024 the Company organized investor communi-
During the reporting period cation event and invited Wanlian Securities China
Merchants Securities Huaan Securities other insti-
tutions and individual investors to conduct on-site
the Company disclosed research thus further strengthening its communica-
4 tions with the investors increasing its transparency regular announcements and improving its governance. The activities included
presentations by the Company's management fac-
tory tours and visits to the R&D Center enabling the
investors to understand the Company's operations
and and strategic planning more comprehensively. During
88 the event the management actively responded to the interim announcements investors' concerns and enhanced their confidence in
the Company. After the event the Company collected
related feedback and provided reference support for
the Company's future investor relations management.Shanghai Stock Exchange's evaluation By continuously deepening its communications with
result of the Company's information
investors the Company continuously improved its
disclosure work in 2023-2024 was rated
governance mechanism and laid a solid foundation
A for its healthy development. Investor Survey
121 122Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Risk Management Tax Management
The Company abides by the local tax laws and regulations of its places of business all During the reporting period
To increase its efficiency of corporate governance and risk management and promote its long-term development and value cre- over the world and fulfills its tax declaration and information disclosure obligations
ation the Company has built an Audit Committee under the Board of Directors to coordinate its compliance management work according to law. We pay all taxes on time empowering social value creation with tax
and supervise the efficient operation of its compliance management system. In addition the Company has also issued a number of contributions. The management strictly implements the reporting mechanism of the
policies including the Internal Audit System and Corporate Risk Control and Early Warning Plan to strengthen its internal control Board of Directors in major business decisions cooperates with internal professional the Company paid taxes of
and risk management and ensure its stable operation and sustainable growth. teams to conduct tax compliance reviews and introduces third-party organizations for
01 02 03 evaluation when necessary in order to ensure that tax risks are controllable throughout
RMB1.078 billion
the decision-making chain. in total
The tax team is actively responsible for managing and supervising the direct and indi-
First line of defense Second line of defense Third line of defense rect tax changes of all entities assessing the potential impacts of new tax legislation and
All departments of the Company Determine that the Legal Affairs De- The Audit Department shall policies on the Company continuously optimizing tax management measures improv-
are responsible for compliance partment is a general compliance audit and evaluate the com- ing compliance with tax policies reducing tax risks and improving the tax management
management of this system and management department which pliance of operations manage- information system to enhance the informatization of tax management.lead such management. shall organize coordinate and ment and the effectiveness of
supervise the compliance manage- compliance management.ment to provide compliance sup-
port for the departments responsi- Business Ethics
ble for compliance management.Adhering to the highest standards of business ethics the Company always regards integrity management information disclosure
Internal Control and Management System of the Company elimination of illegitimate interests prevention of conflicts of interest anti-money laundering anti-fraud and customer privacy
protection as its core principles. In all its business activities the Company its employees and partners are committed to creating a
Rectification of risk issues sunny transparent standardized and orderly corporate ecosystem.The Company adheres to the risk management philosophy of "prevention first supported by control". We emphasize reducing the Taking a "zero tolerance" attitude towards any violations of business ethics we resolutely oppose any form of bribery corruption
possibility of risks through preventive actions and mitigating the impacts of risks through control measures. extortion and other violations of business ethics. For relevant misconducts verified the Company will immediately terminate co-
operation with relevant personnel and take legal measures when necessary for ensuring the Company's ethical and legal rigor.In 2024 the Company sorted out the process for rectifying risk issues informatized the process improved the rectification effi-
ciency and realized real-time monitoring of risk rectification. The risk rectification is a systematic and multi-step process involving
multiple roles including the persons following up on the rectification heads of the responsible departments persons responsible Anti-corruption
for rectification administrator of the risk database and audit manager. The process starts from the entry of risk data ranging from The Company has always strictly abided by the relevant laws and regulations on anti-corruption and anti-bribery and formulated
preliminary review feedback review and approval of rectification measures update of risk database feedback review and review a series of internal systems and norms including the Regulations on Acceptance of Gifts for Business Code of Conduct for Employ-
of rectification situation and reexamination to the confirmation of rectification completion and final filing. This process ensures ees Business Ethics Policies and Management Regulations for Protection against Commercial Bribery to comprehensively stan-
the standardization transparency and effectiveness of our risk management timely implementation of rectification measures and dardize and control the employees' business practices. In addition the Company has signed the Integrity Commitment Letter with
effective risk control through the layer-by-layer review and feedback mechanism. all suppliers it has transacted with to ensure that its partners follow the principle of integrity management. It is expressly stipulated
During the reporting period in the Management Regulations for Protection against Commercial Bribery that the Company shall establish and improve its integ-
rity management system that covers all customers suppliers service providers and contractors who have business dealings with
the Company produced a total of identifying a total of the Company. Adhering to the management policy for "bribery prohibition and fair trade" we resolutely reject commercial bribery
bribe and any form of improper business practices. We are committed to creating a clean honest transparent and fair business
32 summary reports on risk identification 171 medium and high risk items environment.
and included them in the Group's risk database
Audit Department All departments of the Company
In 2024 a total of with a rectification completion rate of
Assess and control our integrity risks; identify integ- Assist the Audit Department in conducting regular
237 rity risks of different departments and positions.problems in the Group's risk database were rectified 78% self-examination on their integrity problems re-Perform regular integrity inspection for each depart- Internal port any problems found to the Audit Department
ment report the integrity problems to the general Integrity and the general manager in time and formulate
By promoting the rectification of the medium and high risk and added/revised a total of manager if any and formulate control measures. Management
Mechanism corrective and preventive actions. problems the Company avoided economic losses totaling Organize on-the-job integrity training for all depart-
11 Particularly organize follow-up on their positions 22.4 standards ments and employees to increase their awareness with integrity risks and formulate corresponding RMB million of integrity. management measures.
123 124Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
The Company deeply advances its Party integrity and clean gover- During the reporting period Anti-money laundering
nance and promotes the integrity culture. We have formulated the
Regulations on Integrity Management to integrate integrity education The Company undertakes to fully abide by national anti-money laundering laws and regulations and resolutely opposes any form
into the corporate culture overall publicity and education work. The the Company conducted of money laundering activities. We deeply realize the great harm of money laundering to financial market stability social public
Company has established a compliance and business ethics training 7 anti-corruption training safety and our reputation taking effective measures to prevent and curb money laundering.system that covers all employees. We strengthen incorruptible em-
ployment and risk control education for key positions. Our marketing
and financial personnel are required to receive training related to the Anti-monopoly
anti-corruption anti-bribery and anti-money laundering. We regular- sessions with a total duration of
ly organize the employees of the Securities Department to learn the 28 The Company has formulated the Management Regulations on Anti-monopoly and Anti-unfair Competitions to ensure that its new regulations of the CSRC. hours operations comply with national anti-monopoly and anti-unfair competition laws and regulations maintain a fair orderly market
environment and protect the legitimate rights and interests of itself and the stakeholders.In addition the Company actively conducts compliance training for
each place of business which covers local laws and regulations its and a total of
compliance code of conduct ethics etc. By carrying out positive and
negative education for typical Party members we have increased 259 participants
these members' awareness of integrity and self-discipline and drawn Monitoring monopoly Preventing abuse of Managing the operators' agreements market dominance centralized declarations
up an annual Party building work plan for corruption prevention.Establish a regular review mech- Evaluate the Company's market Track M&A equity acquisi-
anism to screen agreements and position through market surveys tions and other projects that
Anti-corruption Education and Training for Creating a Clean and Honest Atmosphere exchanges with competitors draw up a self-examination plan might lead to concentration
suppliers distributors etc. and follow the principle of cost plus of the operators predict
From August to October 2024 the Company organized a total of 259 prevent monopolistic behaviors and dynamic balance between whether they meet the decla-
employees in the key positions of the Marketing Center Purchasing involving sensitive areas such as market supply and demand to ration standards and initiate
Department Finance Department Audit Department Technical price output market division price products and avoid acts the declaration process.Center and other departments to visit Guangdong Integrity Educa- and technology sharing. like price discrimination.tion Base for study and conducted anti-corruption education and
training through on-site visits in order to increase the employees'
awareness of laws disciplines and professional ethics mitigate its Detailed Anti-monopoly Rules
operational risks create a clean and upright corporate atmosphere
and promote its sustainable and healthy development. Purchasing Department's Anti-corruption Educa-
tion and Training
In September 2024 to further increase the awareness of integrity and Preventing misleading consumer behaviors Prohibiting commercial bribery
self-discipline among the leaders and cadres in key departments the
Company organized key Party members and leaders of key regula- Formulate norms on brand use conduct infringement The employees in key business positions sign a
tory departments to go to Qingyuan Prison visit the anti-corruption search and prevent counterfeiting and misleading con- letter of commitment on integrity and self-disci-
warning education base and prison command center. They intuitively sumers. pline receive training on anti-commercial bribery
understood the prisoners' life study and re-education and were and establish a registration and confiscation sys-
enlightened. This study and education helped the leaders and cadres tem for gifts.deeply understand the serious consequences of duty crimes keep in Detailed
mind the red lines of discipline strengthen self-discipline and play Anti-unfair
Leaders' and Cadres' Visit to the Self-cultivation Hall vanguard and exemplary roles. Competition
Rules
This activity touched my soul directly made me confident to create a Controlling false propaganda Protecting trade secrets
"sunshine procurement" ecosystem and strengthened my determina-
tion to stay away from corruption and maintain integrity. Promotional materials shall be reviewed by the Legal Clarify the scope of trade secrets implement hi-
Affairs Department to ensure their authenticity and accu- erarchical and classified management ensure in-
I will resolutely fulfill my duties give priority to the interests of the orga- racy. Establish a quick response mechanism for customer formation security and perform strict resignation
A leader of the nization and be honest and self-disciplined. A leader of feedback. and handover procedures.Purchasing the Finance
Department Department
125 126Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Whistleblowing Mechanism
The Company has established a comprehensive whistleblowing system to encour-
age all stakeholders to provide feedback complaints and suggestions on corruption Whistleblowing channel:
money laundering fraud conflict of interest unfair competition and other violations Tel: +86(020)-66818888 Protecting the rights and interests of whistleblowers
through the hotline and e-mail and whistleblowing channels. We promise to serious- Email: ir@kingfa.com
The Company takes measures to protect the rights and privacy of the whistleblowers and
ly process all reported information and protect the rights and privacy of the whis-
ensure that the whistleblowers will not be subject to any form of retaliation.tleblowers.Reward and Punishment Measures of Business Ethics
Anonymous whistleblowing Fast response
The Company respects privacy Once complaints or suggestions are
and makes anonymous whis- received the Company will prompt-
tleblowing optional to encour- ly initiate investigation and handling
age people to provide informa- procedures.tion without concerns.Employees Suppliers and service pro- Truthful Protective Mea-
violating rules viders violating rules whistleblowing sures for Whis-
Forfeit all bribery proceeds and Notify and supervise our depart- Encourage the parties and insid- tleblowing
perform relevant education and ments corresponding to the relat- ers to whistleblow. We will re-
administrative sanctions depen- ed units and send a written warn- ward the whistleblowers whose Maintaining safety and privacy Investigation and handling
dent upon seriousness of the ing letter. If the circumstances are reports are true as demonstrat-
case; transfer them to judicial serious the suppliers and service ed after investigation and main- The Company resolutely protects Including recording and classify-
organs for investigation of their providers will be resolutely dis- tain their confidentiality. the safety and privacy of the whis- ing complaints assigning them to
criminal responsibilities if the qualified. If their acts constitute a tleblowers and ensures the con- relevant departments for handling
circumstances are rather seri- crime of commercial bribery (brib- fidentiality of information during conducting necessary investigations
ous. ery) they will be transferred to the the whistleblowing. and taking appropriate actions.judicial organs for investigation of
their criminal responsibilities.
127 128Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
GRI Index
The information cited in this GRI Content Index is reported by the Company with reference to the GRI
Instructions Disclosed item Sections of the Report
GRI Standards from January 1 2024 to December 31 2024. Standards
2-16 Communication of critical concerns Our Sustainability Management
GRI 1 used GRI 1: Foundation 2021
2-17 Collective knowledge of the highest gover- Operation by the Board of Directors
nance body the Board of Supervisors and the Gen-eral Meetings of Shareholders
Operation by the Board of Directors
GRI Disclosed item Sections of the Report 2-19 Remuneration policies the Board of Supervisors and the gen-Standards eral meetings of shareholders; Talent
attraction and retention
2-1 Organizational details About the Company
2-20 Process to determine remuneration Talent Attraction and Retention
2-2 Entities included in the organization's sustain-
ability reporting Description of the Report Preparation 2-22 Statement on sustainable development To Stakeholders
2-3 Reporting period frequency and contact point Description of the Report Preparation strategies
2-4 Restatements of information List of Key Performance Indicators 2-23 Policy commitments Our Sustainability Management
GRI 2: General
2-6 Activities value chain and other business rela-
tionships About the Company
Disclosures 2021 2-23 Integration policy commitments Our Sustainability Management
2-25 Procedures for remedying negative impacts Safety and Quality of Products and Ser-2-7 Employees Equality Inclusion and Diversity vices
Operation by the Board of Directors
2-9 Governance structure and composition the Board of Supervisors and the Gen- 2-26 Mechanisms for seeking advice and raising Talent Attraction and Retention
eral Meetings of Shareholders concerns
Operation by the Board of Directors
2-10 Nomination and selection of the highest gov- Operation by the Board of Directors
ernance body the Board of Supervisors and the Gen-
2-27 Compliance with laws and regulations the Board of Supervisors and the Gen-
eral Meetings of Shareholders eral Meetings of Shareholders
GRI 2: General
Operation by the Board of Directors
Disclosures 2021 Main Participatory Domestic Associa-2-11 Chair of the highest governance body the Board of Supervisors and the Gen- 2-28 Membership associations tions and Organizations
eral Meetings of Shareholders
2-29 Approach to stakeholder engagement Our Sustainability Management
Our sustainability management; Op-
2-12 Role of the highest governance body in over- eration by the Board of Directors the 2-30 Collective bargaining agreements Talent Attraction and Retention
seeing the management of impacts Board of Supervisors and the general
meetings of shareholders 3-1 Process to determine material topics Our Sustainability Management
Our sustainability management; Op- GRI 3: Material
2-13 Delegation of responsibility for managing eration by the Board of Directors the 3-2 List of material topics Our Sustainability ManagementTopics 2021
impacts Board of Supervisors and the general
meetings of shareholders 3-3 Management of material topics Our Sustainability Management
Our sustainability management; Op- 201-2 Financial implications and other risks and Climate Change Tackling
2-14 Role of the highest governance body in sus- eration by the Board of Directors the opportunities due to climate change
tainability reporting Board of Supervisors and the general GRI 201: Econom-
meetings of shareholders ic Performance 201-3 Defined benefit plan obligations and oth-er retirement plans Talent Attraction and Retention
Operation by the Board of Directors 2016
2-15 Conflict of interest the Board of Supervisors and the Gen- 201-4 Financial subsidies granted by the gov-
eral Meetings of Shareholders ernment Refer to the annual report
129 130Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
GRI
Standards Disclosed item Sections of the Report
GRI
Standards Disclosed item Sections of the Report
GRI 203: Indirect
Rural Revitalization and Social GRI 304: Biodiversity
304-1 Operational sites owned leased managed in or
near protected areas and areas of high biodiversity val- Environmental Compliance Man-economic impacts 203-1 Infrastructure investments and services supported Contributions 2016
2016 ue outside protected areas
agement
205-1 Operations assessed for risks related to corruption Business Ethics 305-1 Direct (Scope 1) GHG emissions Climate Change Tackling
GRI 205: Anti-cor- 205-2 Communication and training about anti-corrup-
tion policies and procedures Business Ethics
305-2 Energy indirect (Scope 2) GHG emissions Climate Change Tackling
ruption 2016
205-3 Confirmed incidents of corruption and actions Business Ethics 305-3 Other indirect (Scope 3) GHG emissions Climate Change Tacklingtaken GRI 305: Emissions
GRI 206: An- 2016
ti-competitive 206-1 Legal actions for anti-competitive behavior No Related Lawsuit in the
305-4 GHG emissions intensity Climate Change Tackling
anti-trust and monopoly practices Company
Behavior 2016
305-5 Reduction of GHG emissions Climate Change Tackling
207-1 Approach to tax Risk Management
305-7 Nitrogen oxides (NOx ) sulfur oxides (SOx ) and List of Key Performance Indicators
GRI 207: Tax 2019 207-2 Tax governance control and risk management Risk Management other significant air emissions
306-1 Waste generation and significant impacts related Pollutant Discharge and Waste
207-3 Stakeholder engagement and management of
concerns related to tax Risk Management
to waste Treatment
Management of Raw and 306-2 Management of significant waste-related impacts
Pollutant Discharge and Waste
301-2 Recycled input materials used GRI 306: Effluents Treatment
GRI 301: Materials Packaging Materials
and Waste 2020
2016 306-3 Waste generated Pollutant Discharge and Waste
301-3 Recycled products and their packaging materials Circular Economy; Management Treatmentof Raw and Packaging Materials
302-1 Energy consumption within the organization Energy Usage 306-4 Waste diverted from disposal
Pollutant Discharge and Waste
Treatment
List of Key Performance 308-1 New suppliers that were screened using environ-302-3 Energy intensity GRI 308: Supplier en- mental criteria List of Key Performance Indicators
GRI 302: Energy Indicators vironmental assess-
2016 ment 2016 308-2 Negative environmental impacts in the supply
302-4 Reduction of energy consumption Energy Usage chain and actions taken Supply Chain Security
302-5 Reduction of energy demand for products and Energy Usage 401-1 New employee hires and employee turnover List of Key Performance Indicators services
GRI 401: Employ- 401-2 Benefits provided to full-time employees
303-1 Interactions with water as a shared resource Usage of Water Resources ment 2016 (excluding temporary or part-time employees)
Talent Attraction and Retention
303-2 Management of water discharge-related impacts Usage of Water Resources 401-3 Parental leave Equality Inclusion and Diversity
GRI 303: Water
403-1 Occupational health and safety management sys- Occupational Health and Safety;
and Effluents 303-3 Water withdrawal Usage of Water Resources tem Overview of Certificates
2018 GRI 403: Occupa-
tional Health and 403-2 Hazard identification risk assessment and inci-303-4 Water discharge Usage of Water Resources dent investigation Occupational Health and Safety
Safety 2018
303-5 Water consumption Usage of Water Resources 403-3 Occupational health services Occupational Health and Safety
131 132Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
GRI
Standards Disclosed item Sections of the Report
Benchmark Index to the Guidelines of the
403-4 Occupational health and safety issues: worker
Occupational Health and Safety Stock Exchange
participation consultation and communication
403-5 Training on occupational health and safety Occupational Health and Safety
Topics disclosed Sections of the Report
403-6 Promotion of worker health Occupational Health and Safety
Climate change tackling Climate Change Tackling
GRI 403: Occupa- 403-7 Prevention and mitigation of occupational health
tional Health and and safety impacts directly linked by business relation- Occupational Health and Safety Pollutant discharge Pollutant Discharge and Waste Treatment; Usage of Water Resources
Safety 2018 ships
403-8 Workers covered by an occupational health and
Occupational Health and Safety Waste disposal Pollutant Discharge and Waste Treatment
safety management system
Ecosystem and biodiversity
403-9 Work-related injuries Occupational Health and Safety protection Environmental Compliance Management
403-10 Work-related ill health Occupational Health and Safety Environmental compliance management Environmental Compliance Management
Employee Training and Develop-
GRI 404: Training 404-1 Average hours of training per year per employee Energy usage Energy Usage
ment
and Education
2016 404-2 Programs for upgrading employee skills and tran- Employee Training and Develop- Usage of water resources Usage of Water Resources
sition assistance programs ment
Operation by the Board of Directors
GRI 405: Diversity
the Board of Supervisors and the Circular economy Circular Economy
and Equal Oppor- 405-1 Diversity of governance bodies and employees
general meetings of shareholders;
tunity 2016
List of Key Performance Indicators Rural revitalization Rural Revitalization and Social Contributions
GRI 406: Anti-Dis- 406-1 Incidents of discrimination and corrective actions
Equality Inclusion and Diversity
crimination 2016 taken Contributions to the society Rural Revitalization and Social Contributions
GRI 407: Freedom
407-1 Operational points and suppliers at risk of violat-
of Association
ing freedom of association and collective bargaining Equality Inclusion and Diversity Innovation-driven Innovation-drive and Intellectual Property
and Collective
rights
Bargaining 2016 Ethics of science and Not involved. The Company's core business does not involve scientific re-search technology development and other activities in sensitive fields such as
GRI 408: Child 408-1 Operations and suppliers at significant risk of technology life sciences and artificial intelligence ethics.Equality Inclusion and Diversity
Labor 2016 child labor incidents
Supply chain security Supply Chain Security
GRI 409: Forced
409-1 Operations and suppliers at significant risk for
or Compulsory Equality Inclusion and Diversity
incidents of forced or compulsory labor Equal treatment to small and Not involved. The Company treats small and medium-sized enterprises equal-
Labor 2016 medium-sized enterprises ly and there is no overdue payment to small or medium-sized enterprises.GRI 413: Local
413-1 Operations with local community engagement Rural Revitalization and Social Safety and quality of products
Communities and services Safety and Quality of Products and Services
impact assessments and development programs Contributions
2016
414-1 New suppliers that were screened using social Data security and customer Data Security and Customer Privacy Protection
GRI 414: Supplier List of Key Performance Indicators privacy protectioncriteria
Social Assess- 414-2 Negative social impacts in the supply chain and Employees Equality Inclusion and Diversity; Talent Attraction and Retention; Employee
ment 2016 Supply Chain Security Training and Development; Occupational Health and Safetyactions taken
416-1 Assessment of the health and safety impacts of Safety and Quality of Products and Due diligence Risk Management
GRI 416: Custom- product and service categories Services
er Health and Communications with stakeholders Our Sustainability Management
Safety 2016 416-2 Incidents of non-compliance concerning the Safety and Quality of Products and
health and safety impacts of products and services Services Anti-commercial bribery and
anti-corruption Business Ethics
GRI 418: Custom- 418-1 Substantiated complaints concerning breaches Data Security and Customer Privacy
er Privacy 2016 of customer privacy and losses of customer data Protection Anti-unfair competition Business Ethics
133 134Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
List of Key Performance Indicators
Index Unit 2021 2022 2023 2024 Index Unit 2021 2022 2023 2024
Environ-
mental Total investment
Wastewater dis-
3 m3 15167781315 12115581982 21795515009 22865427592
Protection in environmental RMB 10000 5510.87 5640.23 6689.70 10765.80
charge intensity
Input protection Recovery rate of
waste gases % 8.03 10.52 26.26 32
Direct energy con- Tonnes of stan-
sumption dard coal 331099.35 222972.54 618559.85 334812.3
Particles Tonne 32.234336 193.155492 753.820625 91.96
Natural Gas3 Standard cubic meters 45420273.21 17958913 122408572 134482393
Emissions
of gaseous Non-methane hydrocarbon Tonne 310.468 257.075 127.673 163.54
pollutants
Diesel Tonne 393 268 284 300.06 Nitrogen oxides Tonne 124.825745 216.483935 106.111583 80.72
Coal water slurry Tonne 432334 314168 424676 275920.61 Sulfur oxide Tonne 33.9 50.833 53.434989 41.24
Indirect energy Tonnes of stan- VOCs emissions Tonne 309.76 721.23 1446.83 548.94
consumption dard coal 373742.97 315849.68 590678.64 616907
Total amount
Energy of wastewater Tonne 528164.0 1463014.4 5434078.1 4760944.73
Consump- Purchased elec-tricity3 '0000 kWh 77610 73306 199721 287800 discharge
3
tion Recovery rate of % 11.54 4.05 8.54 16.42
Medium-pressure wastewater
steam Tonne 2257989.16 1641952.22 2787760.571 1987963.87 Chemical oxygen
demand (COD) Tonne 29.662 82.933 238.711 379.97
Low-pressure
steam Tonne 250039.67 427803.00 325068.7263 380380.31
Emissions
of water Five-day bod (BOD5) Tonne 11.036 14.795 45.819 41.95
PV power genera- pollutants
tion (self genera- '0000 kWh / 1137 1334 2379 Suspended
tion for self use1 matter Tonne 12.202 13.322 34.577 31.45
Total energy con- Tonnes of stan- Ammonia
sumption2 dard coal 704842.25 540220.24 1210877.98 951719.2 nitrogen Tonne 0.522 2.043 6.055 31.95
Intensity of energy Tonne standard Total
consumption coal/RMB '0000 / / 0.24 0.16 phosphorus
Tonne 0.185 0.584 1.822 3.88
operating revenue
Total waste
Purchased munici- Tonne 13691.3 20803.53 20873.35 21109.84
pal water Tonne 5359027 3870989 10627435 12561236.89
disposal
Total amount of
wastes recycled/ Tonne / / / 8916.94
Con- Desalted water Tonne 0 0 2452794 2333191 reusedWaste
sumption emis- Recovery rate of of water
4 wastes
%22.9725.6833.8942
resources Groundwater Tonne 0 0 2356 53469 sion
Disposal of haz-
ardous wastes Tonne 2026.2 3360.6 8848.17 10934.45
Recycled/reused
water volume Tonne / / / 126708 Disposal of
high-level wastes Tonne 0 0 0 0
135 136Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Index Unit 2021 2022 2023 2024 Index Unit 2021 2022 2023 2024
31~40 Persons 3565 4036 4034 4965
Customer satisfaction % / / 92.40 91.30
Cus-
tomer 30 and below Persons 2588 3503 3579 4448
services Customer complaint Employees working in
handling rate % 100 100 100 100 Mainland China Persons 8166 9973 10217 12273
Em- Employees working in
Total number of suppli- other countries and Persons 370 377 412 810
ers / 3226 6699 8307 9780 ployee regions
compo-
sition PhD Persons 106 124 168 212
Suppliers of Mainland
China / 3102 6430 8009 9103
Master Persons 707 895 1136 1364
HK Macao Taiwan and
foreign suppliers / 164 269 298 677 Bachelor Persons 1483 2536 2849 3249
Below bachelor's de-
Percentage of Suppli- gree Persons 6240 6795 6476 8258
er Code of Conduct % 100 100 100 100
signed Em- Total rate of new em-
ployees % 21 18 23 25
Sustain- Percentage of suppli- ploy-ers with clauses that
able ment Total turnover rate % 18 14 19 24include environmental % 100 100 100 100
supply and labor require- Total number of trained
ments* employees Persons 7413 8685 10658 13083chain5
Classification by
Total number of new / 490 3433 1608 1473 gender: trained male Persons 6013 6987 8565 10458 suppliers6 employees
Classification by
Percentage of new gender: trained female Persons 1400 1698 2093 2625
suppliers that were % 100 100 100 100 employeesscreened using envi- Em-
ronmental criteria* ployee Total training hours of employees h 206304 257858 440232 583501.8
Percentage of new training
suppliers that were Average training hours
screened using social % 100 100 100 100 per employee
h 28 30 41 44.6
criteria Classification by gen-
Percentage of our der: total training hours h 166079 211776 340459 390486.1
purchasing specialists % 0 100 100 100 of male employeespassing sustainable Classification by gen-
procurement training der: total training hours h 40225 46082 99774 130097.6
of female employees
Social
Male Persons 6689 8221 8541 10447 Amount of investment
RMB
welfare in social public welfare
14861167635238.30
10000
Em- Female Persons 1847 2129 2088 2636 Notes: In 2021 the Company deployed photovoltaic modules by which power was generated for self-use but the PV power generation was not sys-
ployee tematically analyzed.compo- The PV power generation was included in the total energy consumption.From August 2022 Liaoning Kingfa started trial production and pollutant discharge so material changes occurred to propane consumption
sition 51 years old and above Persons 564 756 892 1050 purchased electricity emission and other indicators.The waste emissions excluded waste empty barrels and paint barrels produced by Kingfa Medical as well as the wastes that the weight is hard
to measure.The number of suppliers which is indicated in the SRM system launched online excludes the number of the suppliers in the systems not
41~50 Persons 1819 2055 2124 2620 launched and overseas bases.
The indicator marked * only indicates the percentage of suppliers of raw materials made in China.
137 138Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Main Participatory Domestic Associations Unit Associations/organizations Position Held
and Organizations Executive vice pres-
Panjin Petroleum and Chemical Industry Association ident-level execu-
tive director unit
Unit Associations/organizations Position Held
Liaoning Kingfa National Acrylonitrile Production Technology Association Group Member unit
China National Light Industry Council Vice chairman unit
Panjin Precursor Chemicals Industry Self-discipline Association Member unit
China Plastic Processing Industry Association Vice chairman unit
Ningbo New Material Industry Association Vice chairman
Plastic Carbon Neutrality Working Group of the National Technical Director and mem-
Standardization Committee on Plastics ber unit Ningbo Petroleum and Chemical Industry Association Vice president
Technical Subcommittee on Modified Plastics of the National Tech- Director and mem- Ningbo Kingfa
nical Standardization Committee on Plastics ber unit Ningbo Beicang District Enterprise Federation (Entrepreneur Associ- Executive chair-
ation) man
China Synthetic Resin Association Standing council member unit Ningbo Plastics Industry Association Vice president
ABS Branch of China Synthetic Resin Association Member unit
Latex Products of Rubber and Rubber Products Director and mem-ber unit
China Association of Automobile Manufacturers Vice chairman unit
Guangdong Medical Devices Management Academy Supervisory unit
China Household Electrical Appliances Association Member unit
China Nonwovens & Industrial Textiles Association Member unit
The Company
China Packaging Federation Vice president unit Guangdong
China Association for Medical Devices Industry Member unit
Kingfa
Society of Competitive Intelligence of China Ordinary member unit Qingyuan Pharmaceutical Society Vice chairman unit
China Electronics Standardization Institute (National Technical Director and mem- Standing council
Standardization Committee on National All-or-nothing Relays) ber unit Guangdong Association for Medical Devices Industry member unit
Working Group on Standards for Pollution Prevention and Control
of Electrical and Electronic Products Ministry of Industry and Infor- Member unit with Guangdong Food & Drug Technology Association for Evaluation &
mation Technology full authorities Certification
Council member
China Association for Public Companies Council member Professional Committee on Recycling of Plastics China Plastic Pro-
cessing Industry Association Director unit
ICT Industry High Quality and Green Development Alliance Standing council member unit Recycled PCR Self-discipline Organization Initiator
Kingfa Environ-
mental
China Industrial Association of Power Sources Member Sustainability Working Group on Food Contact Materials Initiator
Diancheren Council member Green Recycle Plastic Supply Chain Group (GRPG) Member unit
139 140Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Overview of Certificates Guang- Num- Number dong Guang- Lia- Kingfa Chakan Pondi Manesar
Kingfa dong Ningbo oning Kingfa (Eu- Factory Factory Factory
Kingfa ber of of ap-
System certification Com- Kingfa Kingfa Kingfa (USA) rope) of Kingfa of Kingfa of Kingfa
(Viet- certified plicable
nam) compa- compa-
posites (India) (India) (India) nies nies
Zhuhai ISO 9001 ? ? ? ? ? ? ? ? ? 19 21
The Shang- Jiangsu Wuhan Tianjin Cheng-
Kingfa Jiangsu
Compa- hai du Envi- Kingfa
Qin- Vanteque Kingfa
System certification Kingfa Kingfa Kingfa ron- Recy- gyuan Specialty Bioma-ny Kingfa Kingfa Meijin Engineer- terials IATF 16949 ? ? ? ? ? ? 13 16mental cling ing Plastics
GMP ? 1 2
ISO 9001 ? ? ? ? ? ? ? ? ? ?
IATF 16949 ? ? ? ? ? ? ? ISO 13485 ? ? 2 3
Quality
GMP QSR 820 ? 1 2
ISO 13485 MDSAP ? 1 2
Quality
QSR 820 MDR ? 1 1
MDSAP 5GONOGO ? ? 3 4
Environ-
MDR ment ISO 14001 ? ? ? ? ? ? ? 17 21
5GONOGO ? Occupa-
tional
health and ISO 45001 ? ? ? ? ? 15 21
Environment ISO 14001 ? ? ? ? ? ? ? ? ? ? safety
Occupational Hazardous
health and ISO 45001 ? ? ? ? ? ? ? ? ? ? substances QC080000 3 21
safety
Hazardous sub- Laboratory ISO/IEC 17025 ? ? 4 21
stances QC080000 ? ? ? ISCC PLUS 1 2
Laboratory ISO/IEC 17025 ? ? Sustain- OK RECYCLED 2 2
ISCC PLUS ? ability
GRS ? 5 7
Sustainability OK RECYCLED ? ?
Social re- CSR(SA80000/RBA/
GRS ? ? ? ? sponsibility SMETA/IWAY) ? ? 6 21
Social respon- CSR(SA80000/RBA/ Measure-
sibility SMETA/IWAY) ? ? ? ? ment ISO 10012 1 21
Measurement ISO 10012 ? Intellectual
property GB/T 29490 3 15Intellectual
property GB/T 29490 ? ? ? Brand certi-
Brand certifica- fication GB/T 27925 1 15
tion GB/T 27925 ?
Energy ISO 50001 2 21
Energy ISO 50001 ? ?
AEO ? ? 4 15
AEO ? ?
BRC (packaging ? 2 4
BRC (packaging materials)
materials) ?
ISO 28000 (Supply ? ? 3 21
ISO 28000 (Supply Chain Security)
Chain Security) ?
Other GSP (Quality Man-
Other GSP (Quality Man- agement System
agement System ? 1 2
for Medical Device
for Medical Device
Operation)
Operation)
GB/T23001 Integra- GB/T23001 Integra-
tion of informatiza- tion of informatiza-
tion and industrial- ? tion and industrial- 1 15
ization management ization management
systems systems
141 142Kingfa Sci. & Tech. Co. Ltd. Environmental Social and Governance (ESG) Report 2024 Introduction Environmental Responsibilities Social Responsibilities Responsibility for Governance Annex
Reader's Feedback
Dear Reader
Thank you for reading the "2024 Environmental Social and Corporate Governance (ESG) Report of the Company". To pro-
vide you and other stakeholders with more professional and valuable corporate ESG information please answer our relat-
ed questions in this feedback form to help us further improve our future ESG work.Choice Questions (please tick the appropriate box)
1. For the Company what's your identity
□ Employee □ Customer □ Supplier □ Regulatory Authority □ Media
□ Others (please indicate) Editor-in-chief: Chen Pingxu
Consultant: Li Jianjun
2. What is your overall evaluation of this Report
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Editors in Charge: Tang Hailan and Kuang Sirong
3. What do you think of the outline of this Report
□ Very reasonable □ Relatively reasonable □ Medium □ Relatively poor □ Very poor Members of Editorial Board (in no particular order): Huang Hesheng Li Peng Fu Jiangying Wang Zhonglin Ye Nan-
biao Guan Xunning Rao Xiang Lei Yuewen Xu Xianjun Peng Zhi Zhang Chao Peng Zhongquan Wu Jun Chen Yan'an
4. What do you think of the layout design and presentation form of this Report Cheng Qing Zheng Hefen Lu Yuanqiu Liao Mengyuan Qi Wenliang Gu Junyong Zou Junqin Wu Jiechun Wang
Zongke Cai Hongxiang Sun Yajie Yao Bing Jin Lixiao Hu Qisong Yang Yong Zhu Xiao Liu Jin Wang Tingting Lin Shi-
□ Very good □ Relatively good □ Medium □ Relatively poor □ Very poor song Hu Jinni Wang Yanli Qin Chunyan Shen Faqiang Su Limei Li Xianyu Zhou Zhuang Guo Pan Zhou Shengjia Lin
Haibin Liang Wenzhen Xie Zhenpeng Li Baosen Jin Min Huang Hui Jiang Hongmei Chen Xie Li Yihang Nie Kai Wei
5. What do you think of the Company's overall performance in the environmental issues Zhichi Ning Jindi Wang Shuting Li Peng Deng Zhendong Huang Haibin Huang Shifang Zheng Wen Xie Jiang Zhang
Yile Li Guoming Cao Liying Lou Zhihe Zhou Xiaojiao Ma Xintai Guo Shijun Zhou Fengcan Lin Ziyu
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□ Very good □ Relatively good □ Medium □ Relatively poor □ Very poor Disclaimer
The information contained herein does not constitute any investment advice and investors shall not use such information as a
7. What do you think of the Company's overall performance in the governance issues substitute for their independent judgment or make decisions based solely on such information. The Company does not accept any
□ Very good □ Relatively good □ Medium □ Relatively poor □ Very poor responsibility for losses caused or possibly caused by the use of the information contained herein. The information published by
the Company is true and accurate. In case of any inconsistency with the statutory disclosure documents the statutory disclosure
documents shall prevail.If this report constitutes forward-looking statements it shall not restrict the Company's future actions. The Company has no obli-
Open-ended Question: gation and does not undertake to revise the forward-looking statements (if any) contained herein.What opinions and suggestions do you have regarding the Company's ESG work The copyright and the right of final interpretation shall be owned by the Company.
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