2025 Environmental

Social and Governance

Report

Stock Code: 600361

Email address: zqb@innovationmetal.com

Contact number: 010-66536198

Company Address: No. 1808 Floor 18 Excel Centre Wudinghou Street Xicheng District BeijingTABLE OF

CONTENTS

About This Report 01

Chairman’s Message 03 01 04 05

About Innovation New Material 05 Circular Development for 21 Empowering Employees 103 Open Cooperation for a 125

2025 ESG Highlights 09 Sustainable Coexistence Co-creating Prosperity Win-Win Future

Sustainable Development 11 Developing a Circular Economy 23 Promoting Diversity and Inclusion 105 Building a Responsible Supply 127Management Chain

Enabling Talent Development 108

Fortifying Privacy Protection 132

Practising Safety Production 115

02 03 Contributing to Community 135Development

Green and Low-Carbon 33 Technology-Led Jointly 71

Building a Shared Home Driving Innovation

Climate Change Response 35 Accelerating Digital and Intelligent 73 Corporate Governance 141

Transformation

Building a Green Industrial Chain 47 ESG Key Performance Metrics 151

Adhering to Innovation-Led Devel- 80

Environmental Compliance Manage- 55 opment GRI Index 161

ment

Strict Product Quality Control 92 Index of Shanghai Stock Exchange 169

Pollutant Discharge Reduction 59 (SSE) Disclosure Requirements

Service Experience Guarantee 101

Standardised Waste 62

Management

Optimising Water Resource Utilisation 65

Biodiversity Protection 68Innovation New Material | 2025 Environmental Social and Governance Report

Index of Abbreviations for Company Members

Company Abbreviation Full Company Name

About This Report Innovation New Material the Company we Innovation New Material Technology Co. Ltd.Innovation Metal Shandong Innovation Metal Technology Co. Ltd.Innovation Sheet Materials Shandong Innovation Sheet Materials Co. Ltd.Report Introduction

Chuangfeng New Material Shandong Chuangfeng New Material Technology Co. Ltd.This Report is the third Environmental Social and Governance (ESG) report prepared and issued by Innovation New Innovation Beihai Shandong Innovation Beihai Co. Ltd.Material Technology Co. Ltd. (hereinafter referred to as“ Innovation New Material”“ the Company” or“ we”). This

Report focuses on the ESG issues of concern to stakeholders and is intended to present the Company’s ESG strategies Chuanghui New Material Shandong Chuanghui New Material Technology Co. Ltd.management practices and performance in an objective fair and transparent manner thereby helping stakeholders

gain a more comprehensive understanding of Innovation New Material’s progress in sustainable development. Yuanwang Electrotechnics Shandong Yuanwang Electrotechnics Co. Ltd.Innovation Alloy Shandong Innovation Alloy Materials Co. Ltd.Reporting Scope Chuangyuan Renewable Shandong Chuangyuan Renewable Resources Co. Ltd.The scope of this Report is the same as that of the annual report including Innovation New Material and all subsidiaries Innovation Renewable Shandong Innovation Renewable Resources Utilisation Co. Ltd.controlled by Innovation New Material 1 . The statistical scope of the data is indicated throughout this Report and data

is calculated in accordance with national regulations or international standards. Unless otherwise stated the amounts Chuangtai Renewable Shandong Chuangtai Renewable Resources Co. Ltd.in this Report are denominated in RMB.Chuanghui Recycled Shandong Chuanghui Recycled Resources Co. Ltd.Chuangyuan Recycling Shandong Chuangyuan Recycling Co. Ltd.Reporting Period

Chuangran Recycling Shandong Chuangran Recycling Co. Ltd.This Report covers the period from 1 January 2025 to 31 December 2025 (hereinafter“ 2025” or“ this year”). For the Hengwang Cable Shandong Hengwang Cable Co. Ltd.comparability and completeness of this Report the period has been extended forward and backward as appropriate.Innovation Foil Shandong Innovation Foil Technology Co. Ltd.Fulian Innovation Fulian Innovation Technology (Shandong) Co. Ltd.Basis of Preparation

Innovation Additive Shandong Innovation Additive Technology Co. Ltd.This Report is prepared in reference to the Global Reporting Initiative Standards (GRI Standards) Guidelines No. 14 of

Shanghai Stock Exchange for Self-Regulation of Listed Companies – Sustainability Report (Trial) by the Shanghai Stock Innovation Precision Shandong Innovation Precision Technology Co. Ltd.Exchange and the United Nations Sustainable Development Goals (UN SDGs).Liwang Precision Qingdao Liwang Precision Technology Co. Ltd.Mengchuang Light Materials Inner Mongolia Innovation Lightweight New Materials Co. Ltd.Access and Feedback

Inner Mongolia Yuanwang Inner Mongolia Yuanwang Metal Technology Co. Ltd.This Report can be downloaded and viewed on the Company’s website (http://www.innovationmetal.com/) Mengchuang New Materials Inner Mongolia Innovation New Material Co. Ltd.and the Shanghai Stock Exchange’s website (http://www.sse.com.cn/).If you have any valuable suggestions on this Report or would like access to other relevant information please contact Suzhou Chuangtai Suzhou Chuangtai Alloy Material Co. Ltd.us through the following channels:

Email address: zqb@innovationmetal.com Chuangtai Precision Suzhou Chuangtai Precision Technology Co. Ltd.Contact number: 010-66536198

Company Address: No. 1808 Floor 18 Excel Centre Wudinghou Street Xicheng District Beijing Yunchuang Alloy Yunnan Innovation Alloy Co. Ltd.Yunchuang New Material Yunnan Chuangge New Material Science and Technology Co. Ltd.Vietnam Precision Innovation Precision Vietnam Co. Ltd.

0102

1 This includes separable parts of the Company and its investee entities as well as structured entities controlled by the Company.Chairman’s Message

Innovation New Material | 2025 Environmental Social and Governance Report

The year 2025 marks the conclusion of China’s 14th Five-Year Plan and the beginning of the planning phase for China’s 15th Five-Year

Chairman’s Plan. Against the backdrop of China’s deepening high-quality development strategy and the accelerated pace of green transition the global energy structure is undergoing rapid reshaping and the landscape of industrial competition is undergoing profound adjust-

Message ments. The aluminium industry is now facing historic opportunities for high-end intelligent and low-carbon development. Innovation New Material has always upheld the core philosophy of“ Innovation Shapes the Future” resolutely advancing the development

strategy of“ Globalisation High-End Orientation Green Transformation and Digital Intelligence”. With a more forward-looking vision

and more steadfast strides we continue to write a new chapter in high-quality development. We deeply recognise that only by taking

responsibility as our foundation innovation as our driving force and green development as our direction can we seize the initiative

amidst the tides of the times.Recycling gives birth to new life; regeneration creates the future. Innovation New Material has consistently regarded secondary

aluminium as a key pillar of green development continuously refining its recycling and utilisation system to promote the efficient

circulation of resources throughout the industrial chain allowing every resource to continually rejuvenate within the cycle. In 2025

Mr. Cui Lixin the Company’s comprehensive recycling volume of secondary aluminium reached 1.1962 million tonnes enhancing resource efficiency through a closed-loop model and expanding the scope of sustainability through circular practices thereby injecting robust

momentum into the industry’s sustainable prosperity.Chairman of Green practices reflect our original aspirations; low-carbon initiatives lead the way to the future. Innovation New Material

Innovation New remains steadfast in advancing energy conservation efficiency improvement and the transition to clean production continuously

refining its energy management system to build a more robust foundation for green manufacturing. We persistently drive low-carbon

Material upgrades through technological innovation enhancing resource utilisation efficiency and unlocking emission reduction potential

through additive manufacturing exploration and process optimisation. We actively expand green pathways across the entire product

lifecycle making the path to emission reduction clearer and the trajectory of development more sustainable. By the end of 2025 the

Company had four national-level green factories and three provincial-level green factories.Innovation drives our progress; digitalisation empowers our future. Innovation New Material is firmly committed to leading

industrial upgrading through technology continuously advancing digital transformation and developing an innovative production

system. We have established the‘ 54321 Pyramid’ innovation and development strategy focusing on five major product sectors

striving to drive digital transformation and continuously shaping a new landscape for the green aluminium industry that spans the

entire supply chain. We forge core competitiveness through innovation and earn the market’s trust through exceptional quality.Adhering to a philosophy of responsible value delivery and client-oriented development we have maintained a client satisfaction rate

of over 90% for the long term injecting vigorous momentum into our high-end and international development.Talent forms the foundation; hard work paves the way to the future. Innovation New Material has always adhered to a

people-centred development philosophy stimulating creativity within a diverse and inclusive culture expanding opportunities for

growth through continuous training and capability development and ensuring peace of mind by safeguarding safety and health. TheCompany continues to refine its standardised safety production management system fostering a safety culture where“ safety is foreveryone and everyone contributes to safety”. In 2025 the Company’s employee satisfaction survey covered 100% of staff with a

satisfaction rate exceeding 90%. The incidence of occupational diseases remained at zero and the average safety training hours per

employee reached 28 hours.Unity enables us to go far; openness shapes the future. Against the backdrop of global supply chain restructuring and the

acceleration of green transition openness and collaboration are vital pathways to the future. Innovation New Material remains

committed to working hand in hand with clients partners industry organisations and all sectors of society to deepen collaboration

within the green value chain. We also integrate social care into our development framework conveying warmth and strength through

small yet meaningful actions such as educational support poverty alleviation rural revitalisation community outreach and mutual

assistance overseas ensuring that our sense of responsibility takes root in tangible acts of care.Steady progress leads to long-term success; a solid foundation determines the future. Innovation New Material consistently

upholds integrity as its cornerstone and compliance as its guiding principle. We continuously refine our governance systems and risk

control mechanisms proactively practise the principles of fair competition strictly adhere to anti-monopoly and anti-trust competi-

tion regulations and constantly strengthen our anti-corruption defences to foster a transparent and robust business ecosystem. At

the same time the Company is deepening collaborative efforts to promote integrity within the supply chain driving the implementa-

tion of supplier integrity guidelines streamlining supervision and reporting channels and improving whistleblower protection

mechanisms. Through a transparent robust and trustworthy governance foundation we safeguard the Company’s enduring legacy

and ensure steady long-term progress.Looking to the future Innovation New Material will continue to stand united with its employees walk hand in hand with its partners

and keep pace with the times. We will stride forward with determination on the path of high-quality development contributing our

“Innovation” strength to industrial progress social prosperity and the building of a better planet.

03 04Innovation New Material | 2025 Environmental Social and Governance Report

About Innovation New Material

Company Profile Company Milestones

Innovation New Material (Stock Code: 600361) is a large-scale modern and comprehensive enterprise mainly engaged in the R&D and

production of 3C consumer electronics aluminium profiles automotive lightweighting aluminium profiles aluminium rods and 2007 The Founding Year Laying the Cornerstone for a Century-old Enterprise

cables aluminium billets sheets strips foils and structural components. The Company operates more than ten industrial parks

across four provinces (autonomous regions) in China—Shandong Jiangsu Inner Mongolia and Yunnan as well as overseas locations The Company was established specialising in the research development and production of aluminium alloys and

in Vietnam and Mexico forming an industrial layout that facilitates coordinated development both domestically and internationally. related products and set the development goal of“ building a century-old enterprise”. We pioneered the“ directSince 2017 the Company has been ranked among the Top 500 Chinese Enterprises for nine consecutive years. molten aluminium supply” procurement model and established a strategic partnership with Weiqiao Pioneering Group

Co. Ltd. to provide comprehensive solutions for the aluminium alloy processing industry.The Company focuses on the research development and advanced processing of aluminium alloys and their products offering

clients with comprehensive solutions covering design materials and processing. Its products are widely used in various fields such as

3C consumer electronics power infrastructure automotive lightweighting transportation durable consumer goods and packaging 2013 Diversified Development Advancing into the High-End Cable Market

containers. Leveraging a comprehensive industrial chain and advanced technical equipment the Company has developed into one of

the leading aluminium alloy material production and R&D bases in the world. Among them the market share of its aluminium alloy The Company successfully overcame technical challenges in high-strength and high-conductivity aluminium alloy

round ingots and aluminium wire products has ranked first globally. cables achieving a breakthrough in key technologies. During the 13th and 14th Five-Year Plan periods over 70% of the

ultra-high-voltage conductors used in China’s West-to-East Power Transmission project were supplied by the

Company.Company Culture 2018 Accelerating Global Expansion Serving Global 3C Clients

The Company has become one of the core suppliers to global leading 3C consumer electronics research and develop-

ment and manufacturing companies undertaking the R&D preproduction and industrialisation of aluminium alloy

materials required for various new products. the Company’s technological innovation capabilities and stable product

Corporate Objective quality earned widespread recognition from clients.Striving for industry leadership

and building a century-old enterprise 2021 Benchmarking Against Industry Leaders Pioneering Automotive Lightweighting

The Company began supplying aluminium alloy materials in bulk to the world-leading new energy vehicle manufactur-

ers keeping pace with the automotive industry’s trends towards lightweighting and electrification and contributing

material solutions to the green transition of the transportation sector.Business Philosophy Corporate Philosophy 2022 Listing and Setting Sail Embarking on a New Phase of Development

Client satisfaction is the key driving Innovation Shapes the Future The Company completed a major asset restructuring and successfully listed on the capital market achieving continu-

force for a wider presence ous optimisation of the capital structure and sustained growth in development momentum.

2025 Two-way breakthroughs Accelerating Global Industrial Footprint

The Vietnam production base officially commenced operations significantly enhancing global supply chain service

Corporate Mission Corporate Ethos capabilities. By taking a stake in the“ Red Sea Aluminium Comprehensive Industrial Chain Project in Saudi Arabia” the

Company will establish an aluminium industry cluster centred on aluminium production and aluminium alloy

Propelling industry progress through scientific Seek Truth and Be Pragmatic processing while capturing full-chain investment returns ranging from upstream electrolytic aluminium to down-

and technological advancements Pioneer and Innovate stream aluminium fabrication.

05 06Innovation New Material | 2025 Environmental Social and Governance Report

Honours & Awards

Subsidiary Award Name Issuing Body

Manufacturing Single Champion Enterprise Ministry of Industry and Information

Technology

Vice-President Unit of the China Nonferrous China Nonferrous Metals Industry

Metals Industry Association Association

Vice-Chairman Unit of the China Nonferrous China Nonferrous Metals Fabrication

Metals Fabrication Industry Association Industry Association

Innovation Metal Ranked 303 r d in the 2025 Top 500 Innovation Metal Awarded the Title of Manufacturing Innovation Precision Awarded the Title of National-level Innovation

Enterprises of China Single Champion Enterprise Excellent Smart Factory Metal Vice-President Unit of the China Nonferrous China Nonferrous Metals Industry

Metals Industry Association Recycling Metal Association Recycling Metal Branch

Branch

Executive Vice-President Unit of Shandong

Aluminium Industry Association Shandong Aluminium Industry Association

President Unit of the Binzhou Aluminium

Industry Association Binzhou Aluminium Industry Association

General Office of Ministry of Industry and Information

Technology General Office of the National Development

and Reform Commission General Office of the MinistryFour Factories (Yuanwang Electrotechnics Innovation Innovation Precision Certified as a National High-Tech Hengwang Cable Certified as a“ Specialised and National-level Excellent Smart Factory of Finance General Office of the State-owned AssetsMetal Suzhou Chuangtai and Innovation Precision) Expertise Sophisticated SME” Supervision and Administration Commission of the

Awarded the Title of“ National-level Green Factory” State Council General Office of the State Administration

for Market Regulation and the Comprehensive Affairs

Department of the National Data Administration

Leading Enterprise in Excellent Typical High-Tech Department of the Ministry of

Cases for Innovative Development of Future Industry and Information Technology

Industries

Innovation

Precision

Shandong Provincial-level Single-Champion Department of Industry and Information

Enterprise Technology of Shandong Province

Shandong Province New Materials Leading Department of Industry and Information

Innovation New Material Recognised by the China Innovation New Material Recognised by the China Innovation New Material Recognised by the China Enterprise Technology of Shandong Province

Nonferrous Metals Fabrication Industry Association as Nonferrous Metals Fabrication Industry Association as Nonferrous Metals Fabrication Industry Association as a

No.1 in Domestic and Global Market Share for Aluminium No.1 in Domestic and Global Market Share for Aluminium Top 5% Industry Performer in Comprehensive Green

Wire Products in 2025 Alloy Round Ingots in 2025 Development “Craftsmanship” Artisan Training Station Office of Shandong Federation of Trade Unions

Binzhou Municipal Key Laboratory Binzhou Science and Technology Bureau

Innovation Shandong Provincial 2025 Digital Economy Department of Industry and Information

Sheet Materials “Morning Star Factory” Technology of Shandong Province

Suzhou 2024 Jiangsu Provincial Enterprise Technology Industry and Information Technology

Department of JiangsuInnovation New Material Named to the“ Wind’s 2025 Innovation New Material Awarded the Sustainability Innovation New Material Awarded the Title of the 2025 Chuangtai CentreChina Listed Companies ESG Best Practices Top 100 Supply Chain Excellence Award at the 2025 Hon Hai Cailian Press“ Zhiyuan Award · ESG Pioneer Enterprise”(Small and Medium-Cap)” List Foxconn Sustainability Awards

07 082025 ESG Highlights

Innovation New Material | 2025 Environmental Social and Governance Report

2025 Technology-Led Jointly Driving Innovation 03

ESG Highlights ? Innovation Precision has been recognised as a National-level Excellent Smart Factory.? A total of 534 patents have been obtained including 74 invention patents applied to the principal business and 460 utility model patents.? 84 newly authorised patents comprising 14 invention patents and 70 utility model patents.? 14 plants (82%) have obtained ISO 9001 quality management system certification.? 12 plants (71%) have obtained IATF 16949 automotive industry quality management system certification.? Annual client satisfaction survey results remained above 90%.Circular Development for Sustainable Coexistence 01

? A total of 9 secondary aluminium projects have been planned with long-term plans for secondary alumini-

um production capacity to exceed 2 million tonnes. Of these 6 secondary aluminium projects have

already commenced operations with an annual production capacity of 1.7 million tonnes. Empowering Employees Co-creating Prosperity 04

? Comprehensive secondary aluminium utilisation reached 1.1962 million tonnes including 0.6977 million

tonnes of market scrap and industrial offcuts and 0.4985 million tonnes of recycled aluminium from ? 14 plants (82%) have obtained ISO 45001 occupational health and safety management system certification.in-house production lines. ? 4 subsidiaries have completed Level 2 safety standardisation acceptance whilst 6 subsidiaries have passed

? The aluminium content of secondary aluminium after purification can reach up to 99.9%. Level 3 safety standardisation acceptance.? A total of 8 invention patents and 49 utility model patents in the secondary aluminium field have been ? Compliance rate for the work safety responsibility system hazard source control rate emergency drill comple-

obtained. tion rate facility integrity rate special operation personnel certification rate all reached 100%.? Average safety training hours per person reached approximately 28 hours with a 100% pass rate for safety

education and training.? Occupational disease incidence rate was 0%.? Total number of employees: 11125 with female employees accounting for 32%.? Employee satisfaction survey covered 100% of staff with employee satisfaction rate exceeding 90%.Green and Low-Carbon Building a Shared Home 02

? Total procurement of molten aluminium reached 3.2794 million tonnes accounting for 91.92% of

the total volume of aluminium ingots and molten aluminium raw materials.? Total investment in environmental protection reached RMB 41.2414 million achieving zero

excessive emissions. Open Cooperation for a Win-Win Future 05

? 14 plants (82% of our 17 plants) have obtained ISO 14001 environmental management system

certification. ? ESG due diligence on suppliers which account for over 80% of the total annual procurement value has been

? 8 plants (47%) have obtained ISO 50001 energy management system certification. conducted.? All 17 plants (100%) have obtained ISO 14064 greenhouse gas verification. ? Localised employment ratio in operating locations has long remained stable at over 80%.? A total of 9 products obtained ISO 14067 product carbon footprint verification this year with the ? The "Sanyi" Student Assistance Program has been running for 7 consecutive years benefiting a total of 350

cumulative number of certifications in 2024 and 2025 reaching 29. student sponsorships.? 4 national-level green factories and 3 provincial-level green factories. ? Consumption assistance has been conducted for 3 consecutive years with a cumulative procurement of 75000

? 12 subsidiaries have obtained Aluminium Stewardship Initiative (ASI) certification. kg of Huaniu apples an agricultural assistance product.

09 10Innovation New Material | 2025 Environmental Social and Governance Report

Green Transformation

Digital Intelligence

High-End Orientation

Sustainable Globalisation

Development

Management

Innovation New Material adheres to the core philosophy of“ Innovation Shapes the Future” continu-ously deepening its development strategy of“ Globalisation High-End Orientation Green Transforma-tion and Digital Intelligence” and systematically advancing sustainable transformation. This year the

Company completed a double materiality assessment systematically identifying and ranking the dual

financial and impact values of various sustainability issues. Concurrently the Company upgraded its

three-tier governance structure—comprising the Decision-making Level Management Level and

Execution Level—and formulated the Environmental Social and Governance (ESG) Work Guidelines embed-

ding ESG requirements throughout the entire process of strategy operations and risk management.Furthermore leveraging regular stakeholder engagement mechanisms and annual action plans the

Company continues to quantify ESG strategic goals break down tasks and track performance ensur-

ing that various measures take root and deliver results thereby solidifying the Company’s long-term

value foundation.

11 12Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Sustainable Development Management

Sustainability Strategy

As a member of the Aluminium Stewardship Initiative (ASI) Innovation New Material follows the ASI Performance Standards and

deeply advances its“ NOVEL” sustainability strategy. Guided by the established framework of“ One Core Five Pillars” the Companyrefines its annual task list and establishes a closed-loop supervision mechanism of“ monthly tracking quarterly evaluation andannual assessment” to ensure the effective implementation of strategic initiatives. In 2025 building upon this framework the

Company systematically advanced a series of key ESG enhancement projects integrating intelligent and green manufacturing talent

scaling and high-end market positioning into daily operations responding to the UN Sustainable Development Goals through

concrete actions.

1 Strategic Core

With“ Globalisation High-End Orientation Green Transformation and Digital Intelligence” as the strategic direction for our business

we aim to become a world-class developer and manufacturer of aluminium alloy materials.

5 Strategic Pillars Empowering Employees Co-creating Prosperity

(Values-based leadership)

Green and Low-Carbon Building a ? Continuously improve the employee rights protection system fostering an equal respectful and diverse work atmosphere.Shared Home (Nature-based approach) ? Continuously enhance occupational health and safety management smooth training and promotion pathways enabling

employees to thrive with peace of mind and grow together with the Company toward a better future.? Continuously increase the proportion of low-carbon raw materials such as green electricity aluminium whilst reducing upstream

carbon emissions through a“ short-distance transportation of molten aluminium” model. Circular Development for Sustainable Coexistence

? Power production lines with renewable energy including hydropower and photovoltaics while implementing refined upgrades

to processes and equipment unlocking the green potential of every kilowatt-hour of electricity and every gram of aluminium. (Eco-efficiency solutions)

? Widely apply lightweight alloys in new energy vehicles photovoltaics and 3C electronics collaborating with upstream and

downstream partners to reduce emissions and collectively paint a new green landscape for the industry.? Utilise world-leading recycled aluminium sorting and decoating equipment combined with proprietary composition control and

purification processes to achieve the grade preservation and upgraded utilisation of production line offcuts client scrap and

market scrap.? Leverage industrial chain collaboration to extend green lightweighting concepts upstream and downstream allowing aluminium

Open Cooperation for a Win-Win Future resources to circulate perpetually in a closed loop.(Open-minded collaboration) Technology-Led Jointly Driving Innovation

? Integrate key indicators such as green practices compliance and labour rights into the entire lifecycle of supplier management (Leading-edge innovation)

conduct regular on-site audits and capacity enhancement support for core suppliers to build a responsible and resilient supply

chain. ? Accelerate R&D system development concentrating efforts on high-strength high-toughness aluminium alloys to provide

? Help clients achieve lightweighting energy consumption reduction and efficiency improvement goals through high-standard domestic alternatives for critical areas such as power transmission aviation and rail transit safeguarding technological

aluminium alloy products. self-reliance and self-strengthening.? Actively carry out public welfare projects such as educational support rural revitalisation and public facility improvement ? Optimise production processes using digital tools shifting decision-making from“ experience” to“ algorithms” and collaborate

ensuring that corporate development resonates with community prosperity. with clients to broaden industrial application boundaries through higher-performance lower-energy-consumption aluminium

alloy products.

13 14Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Sustainable Development Management

? Break down the ESG strategies action plans and goals into annual work execution plans;

Sustainability Governance ESG Working ? Track the operation of the ESG system and the completion status of phased goals for each Group matter and report regularly goal achievement progress to the ESG Management Leading

(Coordination and

Execution) Group;

? Participate in the preparation of the ESG report and other public ESG materials.In 2025 the Company formulated the Environmental Social and Governance (ESG) Work Guidelines upgrading the ESG governance

structure in an institutionalised manner further clarifying responsibilities work procedures and work requirements at each level

thereby providing institutional assurance for the achievement of ESG goals.? Implement the work plans of the management level and the ESG Working Group main-Currently the Company has established a three-tier ESG governance structure comprising“ Decision-Making Level Management Subsidiary ESGWorking Group taining effective communication with the ESG Working Group and ensure that relevant Level and Execution Level”. Within this framework the Board of Directors serves as the highest authority responsible for the Compa- tasks are effectively executed at the subsidiary level;

ny’s ESG management operations whilst the Strategy and ESG Committee of the Board of Directors oversees ESG matters. At the (Joint Execution) ? Participate in the preparation of the ESG report and other public ESG materials.management level the Company has established an ESG Management Leading Group and an ESG Management Leading Office to

coordinate and oversee all specific ESG initiatives. At the execution level the Company has established an ESG Working Group led by

Innovation Metal as well as Subsidiary ESG Working Groups comprising ESG liaison officers from each subsidiary ensuring that all

initiatives are efficiently implemented at the grassroots level and achieve closed-loop results.Innovation New Material adopts an internal ESG reporting mechanism combining“ regular summaries and immediate reporting” to

ensure the efficient operation of the ESG governance structure. The ESG Working Group and Subsidiary ESG Working Group submit

key performance data to the ESG Management Leading Group on a quarterly basis; the ESG Management Leading Group compiles an

annual report for submission to the Board of Directors for review. For major ESG matters such as environmental compliance incidents

? Review and approve the Company’s ESG strategies goals and work plans oversee the or significant social responsibility-related public opinion we will activate an immediate reporting mechanism to ensure information

Board of operation of the Company’s ESG management; reaches the decision-making level in the shortest possible time so that the Company responds promptly and effectively.Directors ? Review and approve the public disclosure of the ESG report and other material ESG

(Primary information; To ensure that ESG requirements are genuinely integrated into daily operations the Company has implemented a rolling manage-

Responsible Body) ? Ensure the effectiveness of the ESG risk management and internal control systems; ment model comprising“ planning at the start of the year quarterly reviews and an annual comprehensive review”. At the beginning

? Oversee the Company’s ESG management operations. of each year the management issues the annual ESG work plan which is broken down into task lists by business segments and

milestones with corresponding quantitative indicators. The execution personnel submits progress reports to the management on a

quarterly basis and provides a comprehensive report to the decision-making personnel at the end of the year thereby forming a

closed-loop cycle of“ Plan-Do-Check-Act”. In 2025 the Company formulated a total of 18 ESG improvement plans all of which were

implemented as scheduled.? Study and make recommendations on the Company’s ESG-related matters including but

Strategy and ESG not limited to ESG strategies and goals work plans etc.; The Company has integrated ESG performance into the executive remuneration incentive system incorporating key indicators such

Committee ? Review response plans for ESG-related risks that have a material impact on the Company; as the occupational injury rate the number of environmental violations and the number of supply chain disruptions into the annual

(Guidance and ? Review the public disclosure of the ESG report and other material ESG information; performance appraisal framework and linking them to executive performance-related incentives. By aligning sustainability objectives

Supervision) ? Oversee the Company’s commitments and performance on key issues such as climate with executive interests the Company has strengthened top-level accountability for ESG management ensuring that environmental

change. social and governance requirements are effectively cascaded from the strategic level to the operational level.To comprehensively enhance the capabilities of the execution personnel the Company organised three specialised training sessions

in 2025 for the ESG Working Group and the Subsidiary ESG Working Group. The sessions covered topics including fundamental ESG

concepts interpretations of the latest policies and regulations the mainstream ratings logic key clients’ sustainable access require-

ments and technical pathways for achieving the“ dual carbon” goals. The training reached over 300 participants significantly

? Research and draft the Company’s ESG strategies action plans and goals; strengthening the professional competence and operational capabilities of frontline teams. In addition the Company invited external

ESG Management ? Coordinate policy formulation management optimisation and training empowerment to specialist ESG institutions to deliver two specialised training sessions for the ESG Management Leading Group and the ESG Working

Leading Group ensure the effective implementation of ESG strategies and plans; Groups. The training focused on ESG compliance requirements in the aluminium industry ESG practice case studies from peer

(Management and ? Coordinate the preparation of the ESG report and other public ESG materials; review the companies and pathways for implementing ESG strategies further deepening the teams’ understandings of key industry issues. We Supervison)

outcomes of material preparation. have also actively participated in ESG specialised training organised by the Shanghai Stock Exchange and industry associations

keeping abreast of regulatory developments and industry best practices to continuously improve the Company’s ESG management

standards.? Based on the ESG strategies action plans and goals determined by the ESG Management Concurrently the Company has established an annual ESG risk assessment mechanism. Referencing international standards such as

Leading Group ensure the implementation of ESG strategies and plans through policy the International Financial Reporting Standards (IFRS) S1 and S2 on sustainability disclosure and combining industry trends with our ESG Management

drafting management optimisation training empowerment and other means; own operational data the Company conducts both qualitative and quantitative analyses of risks and opportunities related to key Leading Office

? Establish a supervision mechanism for ESG work tasks regularly tracking the implementa- issues such as climate compliance and supply chain. Corresponding mitigation measures and accountability registers are also (Coordination and

Supervison) tion progress of the ESG Working Group; formulated to ensure that ESG principles are embedded into the Company’s operations throughout the entire process from top to

? Organise and coordinate the preparation of the ESG report and other public ESG materials. bottom. This year the Company defined the timeframes for short-term medium-term and long-term impacts in accordance with sustainable development requirements and its own strategic planning.

1516

Execution

Decision-Making ManagementSustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Timeframe Year Reason for Setting

The Company has formulated a three-year sustainable develop-

Short-term 2025 to 2027 ment action plan.The Company’s medium-term sustainable development strategy

Medium-term 2028 to 2030 and financial planning are aligned with the national target of

reaching the carbon peak by 2030.The Company’s long-term sustainable development strategy

Long-term 2031 to 2060 and financial plan are aligned with the national target of

achieving carbon neutrality by 2060.Stakeholders Engagement Methods Key Areas of Focus Engagement Frequency

Shareholders’ Meetings Field trips Climate Change

R&D and InnovationAutomotive Lightweighting Business Group Conducted“ Automotive Lightweighting ESG Shareholders Annual/Interim Reports Research and Questionnaire Response Product Management Quarterly/Ad hocand Investors Corporate Announcements/- SSE E-Interaction Platform Carbon EmissionsFundamentals Training” Client ServicePress Releases Investor Hotline and Email Management

In 2025 the Company’s ESG team delivered an ESG fundamentals

training programme for the Automotive Lightweighting Business

Group. Over 50 colleagues from the two subsidiaries Suzhou Business Ethics and Regular Meetings of Compliance Public Welfare

Chuangtai and Mengchuang Light Materials participated in the Regulatory Authorities Site VisitsGovernment Water Resource Initiatives

training via both online and offline formats. The training covered and regulators Seminars High-level Meetings Quarterly/Ad hocManagement

topics including the definition of ESG the latest supply chain access Regular Information Policy Advisory

Biodiversity

Occupational Health and

requirements for the leading automotive enterprises greenhouse gas Reporting

Conservation

Safety

accounting the carbon reduction benefits of secondary aluminium

and the Company’s production capacity layout. This initiative laid the Business Ethics and

Reporting

groundwork in terms of talent and corporate culture for the Automo- The Board of ComplianceDirectors and High-level The Board of Directors ESG Governance

tive Lightweighting Business Group to secure international orders and Corporate Product Management Sustainable Supply Half-yearly/Ad hocMeetings Regular Questioning

implement the Company’s dual carbon goals. Photo from the training session Management

R&D and Innovation Chain

Site visits

Energy Management

Staff Council

Employee Satisfaction Employee Rights and Employee Training and

Symposium

Sustainable Development Management Survey DiversityEmployees DevelopmentEmployee Feedback Annual/Ad hocTraining Occupational Health and Compensation and

Mailbox

Internal Publication Safety Benefits

Internal Office Software

Stakeholder Engagement

Carbon Emissions

Product Management Management

Business Communication Client Satisfaction Survey Client Service

Clients Climate Change Annual/Ad hoc

Innovation New Material attaches great importance to two-way communication with stakeholders continuously refining communica- Client Feedback Social Media Circular Economy and Response

tion mechanisms actively responding to expectations from all parties and constantly enhancing the Company’s capability for Waste Management Energy Management

sustainable development. The Company places stakeholders at the forefront and has formulated the Company Environment and

Stakeholder Control Procedure to clarify the scope of work division of responsibilities and implementation standards for stakeholder

relationship management. On this basis the Company establishes long-term and stable cooperative relationships with various Bidding and Procurement

stakeholders. Based on the characteristics of its own business and the specific concerns and expectations of different stakeholders Field Trips Sustainable Supply Chain Occupational Health Partners Access and Cooperation Annual/Ad hoc

the Company has systematically identified various stakeholder groups. By establishing a diversified communication platform the Seminars and Forums Product Management and SafetyEvaluation

Company promptly understands and responds to relevant concerns consolidates the foundation of mutual trust and cooperation

and achieves a win-win situation with stakeholders.Climate Change

Community Public Welfare Activities Social Media Public Welfare Initiatives Response Quarterly/Ad hoc

and Public Community Activities Seminars R&D and Innovation Carbon Emissions

Management

17 18Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Sustainable Development Management Results of Double Materiality Assessment

Double Materiality Assessment

The results of the double materiality assessment indicated that four issues—R&D and Innovation Circular Economy Employee Health

and Safety and Product Quality—are of double materiality to Innovation New Material. Through the materiality assessment the

Company identified the three material issues with the greatest impact on its business and they are R&D and Innovation Circular

The Company conducts a double materiality assessment annually and incorporates the results of ESG material issues into its Economy and Employee Health and Safety whilst the two issues that are deemed most material to external stakeholders are

Enterprise Risk Management (ERM) process. During this Reporting period Innovation New Material continued to benchmark against Sustainable Supply Chain and Client Service.domestic and international ESG policies and industry standards. Referencing Guideline No. 14 of Shanghai Stock Exchange for Self-Regula-

tion of Listed Companies — Sustainability Report (Trial) and the Global Reporting Initiative (GRI) Standards and in conjunction with its

core business layout and medium-to-long-term development plans the Company systematically identified 20 environmental social Innovation New Material ESG Issue Summary Table

and governance (ESG) issues relevant to its sustainable management. The Company scored each issue from two dimensions:

“financial materiality” and“ impact materiality” and identified a total of four issues of double materiality.Environmental Area Social Area Corporate Governance Area

Double Materiality Assessment Process Circular Economy R&D and Innovation 1 Business Ethics and Compliance 4Energy Utilisation Employee Health and Safety ESG Governance

Climate Change Response Product Quality

Environmental Compliance Management Employee Training and Development

To ensure that the identification results are scientific comprehensive and aligned with the Company’s actual development the Pollutant Discharge Sustainable Supply Chain 2 ESGCompany conducts the materiality assessment in accordance with three key steps“: Mapping Own Business Operations ? EstablishingWater Resource Utilisation Client Servicethe Issue List ? Double Materiality Assessment”.Waste Treatment Employee Rights and Diversity

Ecosystem and Biodiversity Conservation Compensation and Benefits

Data Security and Client Privacy Protection

Based on the current state of development and future strategic planning the Company systematically Public Welfare Initiatives 3

maps the entire aluminium alloy industry chain clarifies the core businesses such as secondary

aluminium and operational characteristics of production bases both domestically and internationally

and identifies the resource environmental and social impacts at each stage. By mapping the

Mapping Own upstream and downstream value chains the Company systematically identifies key stakeholders Innovation New Material 2025 Double Materiality Matrix

Business including suppliers clients and employees as well as the key concerns of each stakeholder group

Operations regarding the Company. The Company closely monitors national policies and industry trends to

Impact importance only Both financial and impact importance

assess the impact of the external environment on the Company.Sustainable

Business Ethics and Supply Chain Employee Training and

Compliance Development

Energy Utilisation

R&D and Innovation

Based upon the generic issues established by the Shanghai Stock Exchange and taking into account Customer Service

Compensation and

the characteristics of the aluminium alloy industry and the Company’s development strategy we Climate ChangeBenefits Response

further expand the ESG issue list identified in the previous year by referencing international ESG Employee Health and

Establishing Pollutant Discharge Safetystandards and industry ESG requirements thereby laying the groundwork for subsequent analysis.the Issue List ESG Product Quality Circular EconomyEmployee Rights and Governance

Diversity

Water Resource Environmental

Utilisation Compliance Management Waste Management

For each issue on the list the Company conducts an assessment based on two dimensions: impact

materiality and financial materiality. The assessment results are reviewed by third-party experts and Public Welfare Initiatives

submitted to Strategy and ESG Committee of the Board of Directors for deliberation and confirmation. Ecosystem and Data Security and

? Impact Materiality Assessment: Considering the extent of each issue’s environmental and social Biodiversity Conservation Customer Privacy Protection

impact its scope irreversibility and likelihood of occurrence the Company collects and quanti-

fies the opinions from various stakeholders through questionnaire surveys. Neither Financial importance only

Double ? Financial Materiality Assessment: By synthesising the opinions of internal and external experts

Materiality the Company establishes financial materiality thresholds. The potential impact of each issue on Financial Materiality to Innovation New Material

Assessment the Company’s revenue costs assets and cash flows over the short medium and long term as

well as the likelihood of such impacts occurring is analysed. A combination of qualitative and Low Environmental Area Social Area Corporate Governance Area High

quantitative methods is employed to determine the degree of financial materiality.

19 1 The Company does not engage in scientific research technological development or other activities in sensitive areas of technology ethics such as life sciences and 20

artificial intelligence nor is it involved in technology ethics issues

2 Covers two issues: supply chain security and the equitable treatment of SMEs

3 Covers two issues: rural revitalisation and social contribution

4 Covers three issues: anti-commercial bribery and anti-corruption anti-unfair competition and due diligence

High

Impact Materiality to Economy Society and EnvironmentInnovation New Material | 2025 Environmental Social and Governance Report

01

Circular

Development

for Sustainable

Coexistence

As a fully recyclable basic material aluminium’s potential for recycling

represents a vital resource for supporting the green transition. As a key

player in the aluminium alloy industry Innovation New Material has

deeply integrated the concept of sustainable development into its corpo-

rate strategy with the large-scale and high-value application of secondary

aluminium as its core development direction. By continuously improving

our multi-channel recycling network driving upgrades to key equipment

and process technologies and actively participating in the development

of industry standards the Company provides downstream clients with

low-carbon high-quality secondary aluminium products. At the same

time through systematic circular solutions we work with partners across

the industrial chain to drive the aluminium industry’s evolution towards a

sustainable model that is resource-efficient and environmentally friendly.

21 22Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Circular Development for Sustainable Coexistence Operational Execution Level

Developing a Circular Economy Core departments including the R&D Centre Marketing Centre Project Management Department Equipment Department

and Production Department collaborate closely to manage the entire process covering product R&D and process

optimisation market development and client engagement project implementation and resource allocation equipment

maintenance and energy efficiency improvement as well as lean production and quality control.Innovation New Material remains committed to the efficient development and utilisation of secondary aluminium resources an area

that represents a vital component of the Company’s core business thereby providing ongoing support for the low-carbon transition

of the industry and the downstream industrial chain.To ensure the efficient operation and closed-loop management of the secondary aluminium business the Company has established a

regular reporting mechanism. The operational execution level compiles raw material requirements every fortnight to provide a basis

for resource coordination; it also aggregates core operational data—including production sales and quality—on a monthly basis and

reports to the specialised coordination level.Calculations show that the carbon emission intensity of secondary aluminium products over the entire life cycle

is less than 6% of that of primary aluminium. For every tonne of secondary aluminium used to replace primary

aluminium greenhouse gas emissions are reduced by approximately 94.2% whilst saving 3.4 tonnes of

standard coal reducing water consumption by 14 cubic metres and avoiding the generation of approximately

20 tonnes of solid waste.

This achievement not only demonstrates the emission-reduction benefits of the Company’s circular economy model but also

provides quantifiable and traceable green value for the sustainable development of clients and the entire industrial chain. Currently

the Company’s production and recycling systems have obtained authoritative domestic and international certifications for recycled

materials and its relevant products have been recognised by numerous internationally renowned 3C and automotive enterprises.The Company systematically analyses the impact of circular economy issues on its operations

Strategy thoroughly assesses the potential risks and opportunities these issues may present across various dimensions and accordingly plans and implements a series of targeted measures to promote the

The Company has established a three-tier governance structure for secondary aluminium

Governance sound and sustainable development of its business.comprising strategic oversight specialised coordination and operational execution ensuring efficient synergy and compliant advancement of the business at the strategic

operational and resource levels.Potential Impact

Strategic Oversight Level Risk Type Risk Description Operational Impact Financial Impact

The Strategy and ESG Committee of the Board of Directors as the highest authority for circular economy management is

responsible for overseeing the strategic implementation and target execution of the secondary aluminium business. Raw material prices are subject Increased difficulty in

Market Supply to volatility due to macroeco- procurement forecast-

nomic factors policy changes ing and inventory Higher operating costsPrice

and recycling volumes management

The inconsistent quality of

Specialised Coordination Level Raw Material secondary aluminium mixed Increased difficulty in pre-production sorting Increased losses and Quality grades and unstable composi- pre-treatment costs

tion present challenges for and pre-treatment

General Managers of the Company and its subsidiaries are responsible for day-to-day management and overall coordina- subsequent utilisation

tion overseeing production planning capacity allocation and the achievement of sales targets within their respective

units. To ensure resource integration and economies of scale at the corporate level the Company has established the Bulk The smelting and grade New product develop-

Materials Management Committee this year which is responsible for centralised procurement strategies cross-departmen- preservation and recycling Technology and ment cycles are lengthy Increased R&D and

tal resource coordination and supply chain stability management for secondary aluminium. processes for secondary Production aluminium are complex with and production pace is manufacturing costs

high technical barriers slow

23 24Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

? Regarding internal production recycling the Company systematically collects and reuses various types of aluminium waste

Potential Impact generated during production such as aluminium shavings and offcuts striving to maximise the resource utilisation of produc-tion waste. By continuously optimising internal recycling processes and technical methods the Company has consistently

Opportunity Opportunity Description improved the reuse efficiency and value of its own aluminium waste.Type Operational impact Financial Impact ? Regarding the recovery of industrial surplus materials from downstream sectors the Company actively promotes

collaborative circularity within the industrial chain. It has signed long-term resource circulation agreements with downstream

clients establishing a six-in-one circular industry model encompassing R&D design production sales service and recycling.Transitioning from a ? Regarding external market recycling the Company has deployed specialised recycling teams in key regions such as Jiangsu

Enter the high-end green supply supplier-client relationship and Sichuan implementing a regional site-specific recycling strategy. By integrating downstream clients’ procurement

Market Expansion chain to meet the carbon to a partnership enhancing Increased revenue channels with third-party recycling resources the Company has established a large-scale recycling model.reduction needs of top clients the long-term nature and

stability of orders

Optimising Aluminium Scrap Treatment Technology

Alignment with the national dual Providing direct financial

Policy and carbon development strategy support for capacity

Financing Support facilitates access to government expansion and technologi- Reduced financing costs

subsidies and green finance cal upgrades Secondary Aluminium Shavings Processing

support

Build a green secondary Establishing a differentiated To enhance the recycling efficiency and environmental benefits of aluminium shavings Innovation New Material has developed and

aluminium brand by enhancing market image laying the implemented differentiated refined treatment technologies tailored to the specific characteristics of various types of aluminium Brand Equity technical and management foundation for product Increased revenue shavings.capabilities premium pricing and serving high-end clients For aluminium shavings free of plastic the Company employs a multi-stage physical treatment method. Through a magnetic

separation process iron impurities are effectively separated and removed; this is followed by spin-drying and heat-drying to eliminate

oil and moisture adhering to the aluminium shavings thereby producing clean dry raw material that serves as high-quality pre-treat-

ment material for subsequent smelting and casting operations.Expanding Secondary Aluminium Production Capacity For aluminium shavings containing plastic the Company has established a comprehensive treatment system to achieve efficient

resource utilisation of the waste. This process involves three stages of solvent washing vacuum drying air classification grinding

magnetic separation and electrostatic separation gradually stripping away impurities and precisely controlling particle size

Innovation New Material regards the secondary aluminium business as one of its strategic priorities and is vigorously advancing the ultimately achieving efficient separation of plastic from the aluminium shavings. Throughout the process solvents are recycled via

construction of secondary aluminium production lines. By introducing world-class processing equipment and continuously investing distillation significantly reducing treatment costs and environmental footprint.in R&D to optimise key technologies such as secondary aluminium smelting and grade preservation recycling the Company has

significantly improved production efficiency and metal recovery rates. By the end of 2025 the Company had established a total of With the exception of the feeding stage which requires manual operation the entire production line has achieved near-full automa-

nine secondary aluminium projects with long-term plans for a secondary aluminium production capacity exceeding 2 million tonnes. tion. Real-time monitoring via sensors for pressure temperature and liquid level ensures the stability safety and efficiency of the

Of these six projects have already commenced operations with an annual production capacity of 1.7 million tonnes. production process.Expanding Recycling Channels

Following the above treatment

the finished products of secondary aluminium shavings contain ≤0.6% oil and water ≤0.1% plastic and over

99% aluminium.

The Company has established a diversified recycling network encompassing internal production processes downstream clients and

external market resources forming a stable and efficient supply system for secondary aluminium raw materials.This year the Company has continued to enhance its recycling capacity across all channels achieving a total

comprehensive secondary aluminium recycling volume of 1.1962 million tonnes for the year comprising

697700 tonnes of market scrap and industrial surplus materials and 498500 tonnes of aluminium reused for its

own production lines.

25 26Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

After crushing the aluminium scrap first undergoes magnetic separation to remove ferrous impurities followed by multi-stage

Secondary aluminium shavings processing screening using primary and secondary trommels. Larger materials are subjected to air classification to remove lightweight impuri-

ties such as film before proceeding to secondary magnetic separation alongside the finer material. All materials are processed

through an eddy current sorter to separate non-ferrous metals such as aluminium copper and zinc. Materials within the critical

particle size range are then subjected to an X-ray sorter to precisely remove residual impurities such as copper and zinc ultimately

yielding high-purity aluminium alloy products. The sorted aluminium alloys are conveyed to a storage silo for centralised storage

whilst fine non-ferrous metal materials are categorised and managed separately.Upgrading and Purification of Secondary Aluminium

Aluminium shavings Magnetic Spin-drying Magnetic Drying kiln Smelting

free of plastic separation 1 separation 2

Innovation New Material has mastered industry-leading technologies for the high-value utilisation of secondary aluminium. By

applying the principle of metallurgical segregation we have successfully established an efficient system for the purification and

utilisation of secondary aluminium. During the solidification of molten aluminium impurity elements undergo selective separation

due to differences in their distribution coefficients; by regulating the solidification process we achieve efficient separation of

impurities from high-purity aluminium.Aluminium shavings Washing and Air classification Grinding Electrostatic Magnetic During production raw materials first undergo pre-treatment in a melting and holding furnace. Once specifications are met they are

containing plastic spin-drying separation separation

transported via a holding launder to the purification furnace. The Company has developed a solidification control system capable of

precisely regulating the solidification rate of molten aluminium. Combined with a dynamic extrusion-remelting process this ultimate-

ly yields secondary aluminium products that meet high-standard requirements.Post-consumer Aluminium Scrap Processing

Through advanced purification techniques the aluminium content of secondary aluminium can reach up to 99.9% enabling its

application in high-quality products which marks a significant breakthrough in the field of secondary aluminium grade preservation

The Company has established an automated multi-stage integrated system for the precise sorting of post-consumer aluminium and upgraded utilisation and establishes technical and process capabilities that reach an advanced industry level.scrap encompassing processes such as crushing screening magnetic separation air classification eddy current separation and X-ray

sorting thereby forming a continuous closed-loop material handling process. This system is designed to efficiently separate

materials of different compositions and particle sizes ultimately obtaining high-purity secondary aluminium alloys and improving

resource recovery quality. Comparison of the main chemical composition between secondary aluminium and

purified aluminium ingots

Post-consumer aluminium scrap processing Secondary aluminium content (%) Purified ingots content (%)

Silicon ≥0.42 ≤0.04

Shred

Iron ≥0.15 ≤0.004

Vibrating

screen

Eccentric eddy

current sorter MagnesiumAir separation ≥0.52 ≤0.04

Air separation Aluminium

X-ray ≤98.80 ≥99.9

separation

Conveyor

Vibrating

screen

High frequency eccentric

eddy current sorter

27 28Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Upgrading Processing Equipment In 2025 the Company was granted a patent for the invention“ A Device for the Reuse and Treatment of Aluminium Waste Residue”. This patented technology utilises an optimised crushing and grading structure to achieve fine screening of aluminium waste residue

particles which facilitates uniform heating of the material during subsequent smelting reduces the risk of localised oxidation and

To continuously improve the recycling efficiency and product quality of secondary aluminium resources the Company has prioritised improves metal recovery rates and the purity of secondary aluminium.investment in the upgrading and construction of intelligent low-energy-consumption pre-treatment and smelting equipment.Through refined sorting and high-efficiency purification technologies we have significantly reduced production energy consumption The Company’s achievement“ Research and Application of Green Low-Energy and Intelligent Pre-treatment Manufacturingand metal loss. Technology for Secondary Aluminium” was included in the Shandong Provincial Major Scientific and Technological Achievements

Database in 2025. By integrating multi-stage sorting with intelligent recognition this technology efficiently removes various impurities

from aluminium scrap and supports classified pre-treatment by material grades significantly improving the raw material utilisation

efficiency and product quality consistency of secondary aluminium whilst providing reliable process support for large-scale and

Innovation Precision has equipped two advanced pre-treatment production lines for secondary cleaner production.aluminium shavings designed to process shavings generated during machining. The equipment

efficiently removes adhering moisture and oil contamination achieving a removal efficiency of 92%

Innovation thereby effectively enhancing the cleanliness of raw materials for subsequent smelting and

Precision improving energy utilisation efficiency.By the end of 2025 the Company had obtained multiple patents related to secondary aluminium:

? 8 invention patents and 49 utility model patents

Chuangyuan Renewable and Innovation Metal have built green intelligent pre-treatment produc- By the end of 2025 the Company had participated in the formulation and revision of several

tion lines integrating crushing and multi-stage sorting. These lines can process various types of national and industry standards related to secondary aluminium:

aluminium scrap including beverage cans and scrap profiles achieving a comprehensive removal

Chuangyuan ? Recycled Aluminiumefficiency of 90% for all types of metallic and non-metallic impurities. The production line is also

Renewable and ? Aluminium and Aluminium Alloy Terms and De?initions-Part 4：Aluminium Scrapequipped with a paint-removal furnace which utilises a continuous pyrolysis process to remove

Innovation ? Renewable Material for Cast aluminium Alloyspaint and dry the crushed waste whilst ensuring the complete incineration of pyrolysis gases to

Metal ? Recycling Materials for Wrought Aluminium Alloysreduce exhaust emissions. ? Recycling Materials for Pure Aluminium

Suzhou Chuangtai has completed the renovation and expansion of its production line for secondary

aluminium alloy billets with an annual capacity of 250000 tonnes. By implementing energy-saving

upgrades to the existing eight smelting furnaces and two casting systems overall energy consump- Secondary Aluminium Certification

Suzhou tion has been reduced by over 20%. The project has added one paint-removal furnace and two

Chuangtai homogenisation lines further enhancing raw material pre-treatment and product homogenisation

capabilities with an expected reduction of 2% in smelting losses for secondary aluminium. Innovation New Material has made significant progress in establishing a green certification system. Several of its products and

business lines have obtained certification under globally recognised recycling standards providing global clients with traceable and

reliable low-carbon aluminium solutions. By the end of 2025 a number of the Company’s products can be made from 100% renew-

able materials.Upgrading Processing Equipment to Enable Efficient Resource Utilisation GRS Global SCS UL 2809

Recycled Standard Recycled Content Recycled Content

In November 2025 Innovation Precision launched a project to upgrade the supporting pre-treatment facilities of aluminium GRS 4.0 Certification Certification Validation

alloy materials and molten aluminium recovery systems. Through technical upgrades the Company phased out five

outdated units of equipment including the existing online aluminium shavings heating unit and aluminium dross separator

and installed eight new units of equipment such as drying furnace magnetic separator feeder high-efficiency rotary kiln Innovation Metal 7 products 27 products

and cooling screener. Following the upgrade the drying efficiency and stability of aluminium shavings have been significant- Innovation Sheet Materials

ly improved whilst the recovery rate of molten aluminium has increased by approximately 15% effectively enhancing

resource utilisation efficiency.Technological Breakthroughs and Intellectual Property Strategy

Innovation New Material attaches great importance to technological innovation and intellectual property strategy in the secondary

aluminium sector. Through continuous investment in research and development the Company has secured a series of patents in key

areas such as the pre-treatment purification and comprehensive utilisation of aluminium scrap providing robust technical support

for improving the quality of secondary aluminium and reducing production energy consumption and carbon emissions.

29 30Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Impact Risk and Opportunity Management

The Company has incorporated the impacts risks and opportunities associated with secondary aluminium into a systematic

management process covering the entire operational chain from raw material procurement and production processing to product

sales. By establishing professional management mechanisms and monitoring systems we ensure dynamic tracking of relevant issues

and scientific decision-making. Leveraging an information platform the Company tracks and records the sources of secondary

aluminium its composition production processes and product distribution. It also conducts dynamic monitoring and multi-dimen-

sional analysis of internal and external information including supply chain stability raw material price fluctuations changes in

environmental policies and market demand trends. This system not only enables early warning of potential risks but also provides

data support for identifying market opportunities and directions for technological innovation within the context of the circular

economy.Innovation Sheet Materials and Innovation Metal Products from Innovation Precision Metrics and Targets

have been certified to GRS 4.0 (Global Recycled Standard) have obtained SCS Recycled Content Certification

2025 Circular Economy Targets 2025 Achievement

Chuangyuan Renewable to achieve a secondary aluminium raw material Achieved

usage rate of 40% in 2025

Suzhou Chuangtai to achieve a secondary aluminium raw material usage Achieved

rate of 55% in 2025

Products from Innovation Metal Innovation Precision Vietnam Precision and Suzhou Chuangtai

have obtained UL 2809 Recycled Content Validation 2026 Circular Economy Targets

Innovation Metal to achieve a secondary aluminium raw material usage rate of 35% in 2026

Suzhou Chuangtai to achieve a secondary aluminium raw material usage rate of 60% by 2030

Chuangyuan Renewable to achieve a secondary aluminium raw material usage rate of 45% by 2030

31 32Innovation New Material | 2025 Environmental Social and Governance Report

02

Green and

Low-Carbon

Building a

Shared Home

Against the backdrop of ongoing global climate governance and the

deepening green transformation of industries Innovation New Material

remains committed to green development as its guiding principle actively

addressing the challenges of climate change. Whilst strictly adhering to

environmental compliance requirements the Company is deepening its

low-carbon layout across the entire value chain from source emission

reduction to end-use applications. By developing a high-quality portfolio

of green products the Company continues to create low-carbon value for

global clients safeguarding the ecological environment through concrete

actions and contributing to a green future.

33 34Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Green and Low-Carbon Building a Shared Home Capacity Building and Strategic Integration

Climate Change Response

The Company regularly organises specialised carbon management training sessions covering topics

such as carbon emission accounting methods carbon data management requirements and

Specialised interpretation of climate and carbon management systems thereby continuously enhancing the

Training professional capabilities of relevant personnel.The Company conducts climate impact assessments prior to major investments and mergers and

Governance acquisitions as well as during factory operations incorporating carbon costs transition risks and Strategic low-carbon opportunities into decision-making processes.Decision-Making

The Company’s Strategy and ESG Committee continuously monitors the progress of carbon

peaking and carbon neutrality targets and proposes improvement measures in response to any

Progress deviations from these targets.Monitoring

Climate Change Governance System

The Company incorporates climate-related indicators into the remuneration assessment system forThe Company has established a three-tier climate change governance structure comprising the“ Decision-making Level Management business heads including the achievement of carbon reduction targets data quality and theLevel and Execution Level” and has formulated the Innovation New Material Climate Change and Carbon Management System. This

Performance effectiveness of emission reduction projects thereby incentivising the management to actively drive system clearly defines the responsibilities workflows and assessment criteria for each level and department forming a management

Appraisal low-carbon transformation and ensuring the effective implementation of the climate strategy.model characterised by“ system-led structure-supported and process-closed-loop” operations to ensure that climate-related

impacts are identified and managed.Board of Directors | Strategy and ESG Committee

The Board of Directors bears ultimate responsibility for climate management. The Strategy and ESG Committee of Innovation New Material Hosted Specialised Carbon Management Training to Empower

the Board of Directors oversees the formulation and implementation of climate strategies discusses climate-related Green and Low-Carbon Development

issues reviews annual carbon targets and emission reduction pathways and deliberates on major climate-related

matters. In December 2025 Innovation New Material conducted specialised training on green and low-carbon management for all

members of the Carbon Management Working Groups providing systematic explanations on carbon management policy

directions job responsibilities and division of labour and internal operational mechanisms. The training combined policy

ESG Working Group interpretation with simulated practical exercises to strengthen participants’ professional capabilities and practical skills in

The ESG Management Leading Group coordinates the Company’s climate management efforts supervises the carbon management with a 100% pass rate in the assessment. This training was aligned with the Company’s operational

implementation of tasks by the execution level promotes the compilation and disclosure of climate-related needs effectively enhancing the team’s capabilities in carbon accounting and carbon management and laying the

information provides timely feedback on climate-related risks and reports progress to the decision-making level on foundation for the subsequent advancement of carbon accounting and low-carbon operations.a quarterly basis.Carbon Management Working Group | Subsidiary Carbon Manangement Working Groups

The execution level comprises the Carbon Management Working Group and the Subsidiaries’ Carbon Management

Working Groups. The Carbon Management Working Group is responsible for coordinating climate change-related

work and exercising centralised management over the Subsidiary Carbon Management Working Groups. The

Subsidiary Carbon Management Working Groups are responsible for data collection the implementation of carbon

reduction measures and the tracking of carbon reduction targets within their respective subsidiaries.Innovation New Material Specialised Carbon Management Training

3536

Decision-making Management ExecutionSustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Physical Risk Assessment Results

Strategy Potential ImpactRisk Identi- Response Strategies

fication 1 Operational Financial Time- Risk

Impact Impact frame 2 Level

? Assess climate risks in advance

Strong winds heavy rain and when selecting sites for new facilities

storm surges caused by Increased and operational locations;

? Refine emergency response plans for

Climate-Related Impacts typhoons may damage operating Typhoon buildings disrupt production costs and Short- Low extreme weather events such as

and transportation and in reduced term evacuation procedures;

severe cases may result in revenue ? Enhance capacity to respond to

casualties. extreme weather events such as

The Company’s climate actions are closely aligned with the policy direction of green development and industry transformation stockpiling emergency supplies.trends generating multi-dimensional positive impacts across economic social and environmental aspects.Extreme rainfall or flooding

? Economic Trends: The Company actively seizes growth opportunities in low-carbon industries such as new energy vehicles may result in damage to

and photovoltaic power generation; focuses on the R&D and supply of lightweight high-value-added aluminium alloy materials; Extreme infrastructure water and power ? Upgrade the site’s drainage system Increased

and supports emission reduction in downstream industries through green products. rainfall/flood- cuts and disruption to logistics operating Short- Low

and construct flood barriers;

ing potentially preventing the term ? Establish an early warning system ? Social Factors: The Company responds to the need for optimising the employment structure under the“ Dual Carbon” goals Company from operating costs and contingency plans.and continues to cultivate professionals in the low-carbon sector; enhances its capacity to respond to extreme weather events to normally and leading to

ensure supply chain stability. financial losses.? Technical Factors: The Company with low-carbon technological innovation as a core driver advances the digitalisation and

intelligent upgrading of production processes to build green manufacturing capabilities. Under extreme heat conditions ? Enhance early warning capabilities

? Policies and Laws: The Company strictly adheres to national policies on energy conservation carbon reduction and circular outdoor staff may be at risk of and establish contingency plans for Increased extreme heat;

economy implements the Shanghai Stock Exchange’s ESG disclosure requirements and proactively aligns with the Internation- Extreme heatstroke and dehydration; Short- Lowheat the demand for additional operating term ? Incorporate extreme weather

al Sustainability Standards Board (ISSB) standards. refrigeration and cooling costs conditions into the assessment of

facilities increases. new project proposals.To systematically manage the climate impact of its operations the Company has established and refined a comprehensive“ monitor- Under extreme cold conditions the operating efficiency ofing-prevention-management” control system. ? Enhance early warning capabilities production equipment and develop contingency plans for

Extreme decreases affecting production Increased

? Monitoring: In accordance with the ISO 14064 standard the Company has established a carbon emissions accounting system Short- Low extreme cold conditions;cold schedules; outdoor staff may operating

covering Scopes 1 2 and 3 to track energy consumption and emission data in real time. term ? Incorporate extreme weather be at risk of frostbite; the costs conditions into the assessment of

? Prevention: New projects are benchmarked against energy efficiency benchmarks; the Company has improved processes and demand for additional new project proposals.equipment to reduce the negative impact of production systems on the climate; simultaneously the Company has promoted heating/warming facilities

renewable energy projects such as distributed photovoltaic systems to increase the proportion of non-fossil energy used; and increases.continuously improved the aluminium scrap recycling system to steadily increase the proportion of recycled aluminium used.? Management: The Company has established a climate and carbon management structure implemented a“ double materiality” ? Upgrade the recirculating water

assessment mechanism for climate-related matters and conducts regular analyses to identify climate risks and opportunities. cooling system to improve water

High Prolonged high temperatures

reuse rate;

may reduce precipitation Increased Long- ? Conduct research and development tempera- resulting in water scarcity and operating term Low into water-saving technologies to Climate Risk Assessment and Response ture/drought strained water supply. costs reduce water consumption in

production processes;

? Raise staff awareness of water

conservation.In 2025 building on the previous year’s work the Company further deepened its understanding of the impacts of climate change

continued to advance our assessment work and was committed to building a more systematic climate management system. By Rising sea levels lead to coastal

erosion saltwater intrusion and ? Monitor climate change in the deeply integrating climate resilience into corporate governance and strategic planning the Company continuously optimised and Increased project’s operational area;implemented a dynamic management cycle comprising“ risk identification ? scenario analysis ? strategic response ? tracking and the inundation of coastal areas Sea-level operating which may damage coastal Long- Low ? Conduct an environmental impactevaluation”. On the one hand the Company expanded the scope and depth of assessments updated its analysis of transition risks rise costs and infrastructure and affect the term assessment during the preliminary reduced

and opportunities under different temperature rise scenarios and conducted more detailed climate risk assessments of its own operation of coastal businesses feasibility study and site selection revenue

factories and office premises; on the other hand by combining strategic direction the latest climate science consensus and recom- and the safety of personnel. phases of the project.mendations from internal and external experts and through cross-departmental collaboration to integrate feedback from the front

lines of our operations the Company prioritised and dynamically assessed identified risks and opportunities providing decision-mak-

ing support for the iteration of response measures. 1 The Company’s reference to key climate change trends includes research findings and reports published by authoritative bodies such as the Intergovernmental Panel on Climate Change (IPCC) the International Energy Agency (IEA) and the Network for Greening the Financial System (NGFS) as well as their descriptions of various emission

scenarios.

3738

2 Taking into account core business planning the timeframe of societal low-carbon development goals climate-related disclosure standards and management

recommendations we have defined the timeframes as follows: within one year of the end of this Reporting period inclusive of one year (short term); one to five years after

the end of this Reporting period inclusive of five years (medium term); and more than five years after the end of this Reporting period (long term). This approach enables a

reasonable assessment on how the Company’s business development is affected by climate change across different timeframes.Risk Type Acute risks Chronic risksSustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Transition Risk Assessment Results Opportu- Operational Impact Financial Proba- Response Strategy

nity Type Impact bility

Potential Impact

Risk Identi- Response Strategies By introducing green renewable energy and optimising production processes the ? Strengthen R&D and innovation

fication Operational Financial Time- Risk Company develops low-carbon products to optimise product performance and Increase product processes and enhance competi-

Impact Impact frame Level meet market demand. At the same time it Products and premiums and enters into strategic cooperation High tiveness;

Services boost sales agreements with downstream clients on ? Expand market channels strengthen

Carbon Carbon allowances must be Increased

? Actively participate in the carbon profitsaluminium recycling thereby facilitating the brand promotion and build a green

costs of trading market and formulate a production of greener aluminium alloy and low-carbon industrial chain Trading supplemented through market

trading increasing compliance purchasing Short to rational strategy for purchasing

ecosystem.and Carbon products.costs; expansion into overseas carbon medium Medium carbon emission allowances;Border

markets is constrained by rising allowances term ? Plan ahead and explore low-carbon Adjustment

carbon costs. and carbon production models to reduce Mechanism Shifting consumer attitudes and accelerat- Growing demand credits reliance on emission allowances.ing market transition towards low-carbon for low-carbon

? Drive the low-carbon transition

Market products drives High cultivate new market opportunities Increased ? Establish a policy research team to solutions drive increased demand for green an increase in and achieve growth in green Disclosure requirements from costs for aluminium alloys. business revenue.international and domestic personnel monitor disclosure requirements; revenue

Disclosure bodies are becoming stricter information Short- Low ? Use digital tools to improve the

leading to rising costs for data tracking and term efficiency of information disclosure;? Strengthen stakeholder engage- Implement energy-saving technical Reduce collection and verification. mainte- ment. Resource upgrades improve production efficiency production costs

? Gradually implement energy-saving

nance Efficiency reduce resource consumption and energy and increase Medium technical upgrades and optimise the

loss and increase output per unit. sales profits utilisation of resources and energy.Traditional technologies are

ill-suited to users’ new ? Collaborate with research

low-carbon demands institutions to develop clean ? Expand investment in green energy

Technologi- necessitating research Short to technologies;

Deploy green energy facilities such as wind and increase the proportion of

Increased

development and investment medium Medium ? Establish a technology assessment Energy solar and energy storage; expand the energy procured and utilised for cal Change R&D costs Reduce energy

in low-carbon transition term framework; cultivate technical talent Sources proportion of hydropower used in Yunnan Medium facilities such as wind solar and

technologies and projects and enhance technical adaptation Province and increase the share of

costs energy storage;

which may carry a risk of capabilities. renewable energy. ? Strengthen energy management and

failure. optimise energy allocation.Downstream clients are raising ? Deepen industrial chain collabora-

their low-carbon requirements ? Strengthen market research and tion establish long-term partner-

for products and operations expand into the green product Deploy new energy sources to enhance ships and jointly address market

Demand for requiring the Company to Increased market; resource resilience; expand the green changes;Increase

Green source more green raw Operating Medium Medium ? Collaborate with suppliers to explore term Resilience market to strengthen market competitive- High

? Increase investment in R&D to

operating

Products materials and energy and Costs green raw material sourcing and ness meet downstream client needs and improve the low-carbon revenue

upgrade low-carbon technolo- enhance the environmental generate new revenue. performance of products;

gies. performance of products. ? Establish a risk early-warning

mechanism to identify and address

potential risks in advance.If the Company’s actions are ? Establish stakeholder engagement

inconsistent with its low-car- Reduced mechanisms to respond promptly to

Stakeholder bon principles it may lead to revenue and Long- concerns;

Feedback negative assessments of the Low Climate Scenario Analysisgoodwill term ? Strengthen brand development

Company by the market and highlighting green and low-carbon

investors. principles and practices. We continuously conduct climate scenario analysis to dynamically track the risks and opportunities facing the Company under

different climate scenarios. By integrating climate change trends policy updates and business developments over the past year the

Company assesses the evolution of physical and transition risks across its operational locations under low-emission and high-emis-

sion scenarios providing a scientific basis for the Company’s medium to long-term strategic decision-making and risk management.Climate Opportunity Assessment Results We continue to utilise a scenario framework that is highly aligned with our industry characteristics policy sensitivity and operational

footprint. We assess physical risk resilience using the IPCC SSP1-2.6 (low-emission scenario) and IPCC SSP5-8.5 (high-emission

scenario) whilst evaluating transition risks using the IEA Net Zero Emissions by 2050 Scenario (NZE2050) and the Stated Policies

In 2025 against the backdrop of the deepening of the‘ Dual Carbon’ goals and the acceleration of the global low-carbon transition Scenario (STEPS).demand for low-carbon aluminium products across the industrial chain has further expanded. At the same time policy support for

green technologies and renewable energy has increased significantly. Relying on technological iteration and industrial chain synergy

the Company has deepened its green energy deployment and continuously promoted the low-carbon upgrading of its products

thereby proactively seizing market opportunities and building long-term competitive advantages.

3940

Risk Type Policy and Legal risks Technological risks Market risks Reputational riskSustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Scenario Selection Scenario Analysis Process and Results

Low-emission Scenario High-emission Scenario Taking into account the Company’s latest business layout and risk management measures we have updated our assessment of the

risk impact levels for 2030 and 2050.IPCC SSP1-2.6 IPCC SSP5-8.5

Physical Risks Assuming that global emission reduction efforts are actively Assuming no climate policy intervention global

pursued and the targets of the Paris Agreement are achieved Risk Impact Leveltemperatures by the end of this century will rise by

global warming this century will not exceed 2°C above more than 4.4°C compared to pre-industrial levels

pre-industrial levels (1850). with frequent extreme weather events. Risk Description Low-emission Scenario High-emission Scenario

2030205020302050

IEA Net Zero Scenario (NZE2050) IEA STEPS

Typhoons

Transition Risks Assuming global carbon neutrality is achieved by 2050 with Assuming only announced policies and regulatory Acute Risks

rapidly rising carbon prices and the widespread adoption of frameworks are taken into account with energy

clean technologies. demand continuing to grow and conventional fuels Extreme rainfall/floods

remaining dominant.High temperatures/

drought

Chronic Risks

Key Scenario Factors and Potential Impacts Sea-level rise

Risk

Categories Low-emission Scenario High-emission Scenario

Policy and Legal Risks Carbon trading and carbon adjustment mechanisms

If temperature rise is limited to within 2°C the With a temperature rise of 4.4°C the probability

Extreme probability and intensity of extreme weather events Clean technology and intensity of extreme weather events (such as Technology Risks

Weather (such as floods heavy rainfall and typhoons) substitutionfloods heavy rainfall and typhoons) increase.decrease.Water The supply of water for production remains relatively Particularly in regions prone to frequent droughts

Risk Impact Level

Resource stable and the risk of water scarcity is low. the supply of water for production may be severely

Pressure affected and the risk of water scarcity intensifies. Low Medium High

Supply The supply chain logistics system and raw material Climate-related disasters may lead to supply chain

Chain supply are relatively unaffected by rising tempera- backlogs and shortages of raw materials resulting

Stability tures and the risk of supply chain disruption is low. in a higher risk of supply chain disruption.In terms of physical risks the Company has effectively enhanced its capacity to respond to extreme weather events through facility

upgrades optimisation of contingency plans and water-saving technological improvements. Although the risk of high temperatures

Failure to strictly implement carbon neutrality and drought is increasing it remains within manageable limits overall.With the accelerated implementation of domestic and

Policy plans in various countries and regions coupled international low-carbon policies enterprises need to

Pressure with significant fluctuations in energy prices

Regarding transition risks under a low-emission scenario the Company accelerates the transition to renewable energy and the

accelerate energy-saving technical upgrades and the results in insufficient incentives for carbon deployment of low-carbon products and has established a carbon management system to address rising carbon costs; under a

transition to green electricity. reduction. high-emission scenario the Company maintains policy sensitivity and dynamically adjusts the pace of transition to ensure risk

resilience across different scenarios.With demand for low-carbon products on the rise Growth in demand for low-carbon products slows

Market enterprises need to accelerate the low-carbon with traditional aluminium products still

Demand transformation of production and operations. dominating the market; returns on low-carbon

Moving forward the Company will continue to deepen its climate scenario analysis by incorporating more regional climate models

initiatives for enterprises fall short of expectations. and business scenarios. Through quantitative analysis we will further enhance the accuracy of risk assessments and promote the

deep integration of climate risk response measures with the Company’s strategic planning.Carbon With carbon prices remaining at a high level enterprises need to rapidly implement renewable Carbon prices remain at a low level reducing the Trading energy solutions to replace traditional energy urgency for enterprises to invest in renewable Prices consumption. energy.

4142

Physical Risks Transition RisksSustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Risk Management Metrics and Targets

The Company has fully integrated climate risk management into its overall risk control framework and value chain decision-making to

address the challenges posed by climate change to business operations. By establishing cross-functional teams the Company Carbon Reduction Target Setting

conducts proactive monitoring assessment and response to climate risks. The Board of Directors and the Strategy and ESG Commit-

tee regularly review the results of relevant risk assessments incorporate them into strategic decision-making and provide ongoing

guidance for management improvement. Currently the Company has established a systematic climate risk management mechanism The Company has established a company-wide medium to long term carbon target management system. Taking 2025 as the base

covering the entire value chain. year the Company has clearly defined the core objectives of“ Carbon Peaking by 2030 and Carbon Neutrality by 2050”. The Company

will continue to deepen its low-carbon transition strategy and contribute to achieving the nationa“l Dual Carbon” goals through

technological innovation management optimisation and industrial chain collaboration.? The Company actively collects data on the full life cycle carbon footprint (LCA data) of

suppliers’ products establishes a supplier LCA environmental performance database

Upstream dynamically monitors environmental standards and requirements across relevant indus- Carbon Reduction Targets of the Subsidiaries Progress in 2025

tries and conducts in-depth assessments and analyses of the climate change impacts within

the supply chain.Taking 2024 as the base year greenhouse gas emission intensity

? The Company tracks carbon emission indicators and the progress of carbon reduction (Scope 1 + Scope 2) was reduced by 5% in 2025 Achieved

projects on a quarterly basis to manage potential risks; It comprehensively assesses Mengchuang

investments in low-carbon technology R&D and operational costs and reviews R&D funding Light Materials

and project priorities.? The Company steadily advances low-carbon projects in accordance with the established

roadmap; regularly evaluates implementation effectiveness and interim outcomes to ensure

Operations the achievement of carbon reduction targets. Taking 2024 as the base year greenhouse gas emission intensity Ongoing

? The Company conducts in-depth analysis of policies related to carbon peaking and carbon Yunchuang (Scope 1 + Scope 2) will be reduced by 2% by 2030

emission reduction and assesses their potential impact on the Company’s business Alloy

operations and development.? The Company conducts analyses related to the low-carbon transition to identify the

Company’s strengths and weaknesses as well as the opportunities and risks it faces

thereby laying a solid foundation for the application of low-carbon technologies. Taking 2024 as the base year greenhouse gas emission intensity

Mengchuang (Scope 1 + Scope 2) will be reduced by 2% by 2030

Ongoing

? The Company systematically collects and complies specific client requirements regarding New Materials

carbon reduction within the supply chain.Downstream ? The Company deepens industry-academia-research collaboration promotes green and

low-carbon product design concepts and works closely with clients to advance carbon

reduction design efforts across the entire supply chain. In 2025 the Company’s total greenhouse gas emissions increased year-on-year primarily reflecting the enhanced precision of the

Company’s carbon emissions management and the continued expansion of its business scale. On the one hand the Company has

systematically optimised its carbon data monitoring and accounting system across all scopes resulting in a more complete and

accurate emissions inventory. On the other hand the smooth commissioning of new production lines and the ramp-up of capacity at

existing sites have led to a corresponding increase in the volume of operational activities causing a temporary rise in emissions. In

The Company regularly reviews and optimises the aforementioned processes to ensure their continued integration with the overall this process by continuously optimising energy efficiency and promoting emission reduction projects the Company has achieved a

risk management system; should any adjustments be made the updated content and reasons will be disclosed in a timely manner. sustained reduction in carbon emission intensity per unit of product across its aluminium rods wires and cables profiles and FRP

products.Carbon Emissions Accounting and Disclosure

To strengthen the Company’s target management capabilities and effectively track the Company’s carbon reduction performance

we have established a routine monitoring system for Scope 1 2 and 3 greenhouse gas emissions and emission intensity. At the same

time in accordance with ISO 14064-1:2018 the Company has engaged a professional third-party organisation to conduct annual

verification of greenhouse gas emissions within the scope of operational control and to issue a third-party verification statement.

43 44Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

2025 Product greenhouse gas emission intensity

Scope 1 Scope 2 Scope 2

total total total

greenhouse greenhouse greenhouse

gas emissions gas emissions (location-based) gas emissions (market-based)

422061.53414142.17402572.40

tonne of CO? equivalent tonne of CO? equivalent tonne of CO? equivalent Aluminium billets & Aluminium FRP Structural

rods wires and cables profiles products components

0.130.710.507.11

Greenhouse gas emission intensity tonne of CO2 tonne of CO2 tonne of CO2 tonne of CO2

equivalent /tonne equivalent /tonne equivalent /tonne equivalent / 10000 pcs

Metric Unit 2025

The Company’s greenhouse gas accounting strictly adheres to ISO 14064-1:2018 and the GHG Protocol Corporate Greenhouse Gas

Total greenhouse gas emissions per million RMB tonne of CO? equivalent per million 10.85 Accounting and Reporting Standard adopting the operational control approach to define organisational boundaries. All production

revenue (Scope 1 and Scope 2) RMB of revenue bases ancillary facilities and business units under the Company’s operational control are included in the accounting scope ensuring

coverage of all emission sources directly managed by the Company. Scope 1 emissions are calculated using a combination of the

direct measurement method and the emission factor method. Scope 2 emissions are calculated using both location-based and

market-based approaches. Location-based emissions are calculated using annual regional grid emission factors released by the

Ministry of Ecology and Environment whilst market-based emissions are calculated based on the Company’s green electricity

procurement contracts and the actual consumption of Renewable Energy Certificates (RECs). Scope 3 emissions are calculated using

a combination of supplier-specific factors and industry-average emission factors. Key assumptions include the applicability of

tonne-kilometre emission factors for the transportation sector and the energy consumption associated with downstream product

processing. The 2025 greenhouse gas emissions data have been verified by a qualified third-party organisation.Emissions Reduction Practices and Achievements

In 2025 the Company effectively drove the continuous optimisation of carbon emission efficiency through the implementation of a

series of systematic emission reduction initiatives. In production and operations the Company prioritised the electrification and

energy-saving retrofits of key equipment such as melting furnaces and homogenisation furnaces whilst implementing multiple

renewable energy projects including ORC waste heat recovery power generation and distributed photovoltaic power generation. In

circular economy the Company continued to expand its capacity and technical capabilities for the grade preservation and utilisation

of recycled aluminium while refining its closed-loop recycling system to reduce the carbon footprint of products at the raw materialstage. Furthermore by establishing a three-tier carbon management framework comprising“ decision-making management andexecution” and by incorporating climate considerations into strategic investment and operational decisions the Company ensured

the systematic advancement and effective implementation of its emission reduction initiatives.

45 46Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Green and Low-Carbon Building a Shared Home Process Decarbonisation: Forging a New

Building a Green Industrial Chain Engine for Low-Carbon Manufacturing

In accordance with the Energy Conservation Law of the People’s Republic of China and ISO 50001 the Company has established systems

Innovation New Material adheres to a full-life cycle carbon reduction approach integrating green and low-carbon requirements such as the Energy Management System Manual and the Energy Review and Control Procedure continuously refining its energy perfor-

throughout the entire process—from green procurement and manufacturing processes to end-use applications—to establish an mance evaluation and improvement mechanisms. In 2025 eight of the Company’s plants obtained ISO 50001 Energy Management

integrated green industrial chain across the upstream and downstream value chain. System certification further expanding the scope of the energy management system.To systematically enhance energy efficiency the Company has established a comprehensive three-tier energy governance structure

Source Decarbonisation: Embedding Green comprising the“ Board of Directors ? Management ? Executive Level”.Principles into Raw Materials Board of Directors

Strategy and ESG Committee of the Board of Directors

As the highest governing body the Committee is responsible for overseeing the Company’s energy development policies and

overall carbon neutrality strategy.Green Aluminium Green Transportation

Management

The Company integrates green and low-carbon principles Leveraging the advantages of the aluminium industry Energy Management Leading Groupinto its selection of raw materials continuously advancing cluster the Company has established an“ Innovativeits strategic partnerships for green electricity aluminium. It Model” based on the“ short-distance transportation of Chaired by the Deputy General Manager this group is responsible for formulating specific energy management policiesfocuses particularly on regions rich in wind and solar power molten aluminium” effectively reducing carbon emissions approving phased energy-saving and carbon reduction targets and coordinating the operation of cross-departmental systems.and hydropower resources such as Inner Mongolia and generated during both the transportation process and the

Yunnan province and actively engages in deep cooperation remelting of aluminium ingots. By adopting a

with suppliers that produce electrolytic aluminium using “door-to-door” procurement and processing model for

renewable energy working together to reduce carbon molten aluminium approximately 70 m3 of natural gas can Execution Level

emissions at the source. be saved for every tonne of molten aluminium utilised Subsidiary Energy Management Groups

compared to remelting aluminium ingots. Extending management requirements to the production front line the groups are responsible for the implementation of the

energy management system routine energy performance monitoring and refined on-site management.The aluminium alloy round ingots (hydro-

power-based aluminium) produced by the

subsidiary Yunchuang Alloy utilise hydro- In 2025 the Company procured a total of Renewable Energy Utilisation

power-based aluminium as raw materials. 3.2794 million tonnes of molten aluminium

Compared to traditional coal-fired pow- accounting for 91.92% of the total volume of

er-based aluminium this approach aluminium ingots and molten aluminium raw

effectively reduces the product’s carbon materials used. Innovation New Material continuously optimises its

footprint by approximately 56% during the energy mix and actively increases the proportion of

raw material stage. renewable energy used driving process decarbonisation

through a combination of renewable energy substitution

and the in-house green electricity generation. In

resource-rich regions such as Yunnan Province and Inner

Mongolia the Company makes full use of renewable

energy sources including hydropower wind power and

solar power to provide green electricity for production

operations. At the same time the Company continues to

expand the scope of its rooftop photovoltaic installa-

tions harnessing solar energy to power production lines

and advancing the development and utilisation of

renewable energy.

47 48Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

The Company is further exploring energy-saving potential. Focusing on the entire aluminium processing production cycle it conducts

internal and external audits on raw material utilisation efficiency energy consumption levels process losses and pollutant genera-

By the end of 2025 the Company had installed a cumulative total of 64.39 MW of photovoltaic power generation tion stages. This has resulted in a list of improvement measures for energy conservation consumption reduction pollution control

equipment generating 66659.88 MWh of electricity annually with an estimated annual reduction of approxi- and carbon reduction continuously enhancing process decarbonisation capabilities and resource utilisation efficiency. In 2025 five

mately 41269.13 tonnes of carbon dioxide emissions. In 2025 the Company consumed 64834.87 MWh of subsidiaries conducted cleaner production audits.rooftop photovoltaic power generation an increase of 58% compared to 2024.The Company encourages employees to propose improvement plans centred on energy conservation emissions reduction pollution

control and efficiency enhancement and incorporates feasible measures into its continuous improvement plan. This has gradually

Furthermore Innovation New Material actively purchased green certificates in 2025 corresponding to 21656 led to the formation of multi-tiered initiatives covering process optimisation process control and resource recovery thereby

MWh of green electricity. Through market-based trading of green electricity and green certificates the Compa- improving the efficiency of energy and resource utilisation.ny continues to increase its utilisation of renewable energy gradually moving towards the replacement of fossil

fuels. To systematically advance energy conservation and low-carbon transition the Company prioritises energy-saving technological

upgrades as a key focus area. It continues to implement multiple energy-saving demonstration projects to drive a shift in energy

utilisation from“ high consumption” to“ high efficiency”.Energy Management Objectives Progress in 2025 By efficiently recovering thermal energy from high-temperature flue gas to preheat combustion air

this technology raises the temperature of the combustion air to a temperature just 50?100°C below

By 2030 the proportion of renewable energy in the Company’s total energy 12.32% Application of the furnace temperature whilst reducing the exhaust flue gas temperature to 200°C. The applica-

consumption will reach 15%. Regenerative tion of this technology has significantly improved thermal efficiency in the Company’s production

Combustion processes saving approximately 5.5 standard cubic metres of natural gas per tonne of aluminium

Technology thereby effectively reducing fuel consumption and carbon dioxide emissions.Hengwang Cable: Photovoltaic Expansion Project The Company mixes and recovers high-temperature flue gas generated by both the recycled

aluminium decoating furnace and the smelting furnace and feeds it into a waste heat boiler to

Hengwang Cable continues to deepen its green energy strategy and has been systematically advancing its solar expansion produce steam. In addition to being used for onsite heating and certain production workshops the In-depth

project. In 2025 Hengwang Cable added 3.41 MW of installed capacity; once fully operational the project is expected to steam is also fed into a waste heat power generation system after pressure and flow stabilisation Cascading

generate 4.4 million kWh of electricity annually. where it is converted into high-quality electricity. The first phase of this project is expected to Utilisation of generate 9.6 million kWh of electricity annually converting industrial waste heat into renewable

Energy energy for production use.The Company is steadily advancing the energy-efficient upgrade of site lighting gradually replacing

Green Lighting for lighting fixtures in workshops and office areas with high-efficiency and energy-saving LED lamps to

Energy Conserva- enhance the energy utilisation efficiency of the lighting system.tion and Emissions

Reduction

Furthermore the Company organised specialised training for all staff in energy management roles covering topics such as

cutting-edge energy-saving technologies industry energy efficiency benchmarking and the optimisation of energy management

systems. By integrating external experts with internal case studies the team’s professional skills and practical capabilities have been

effectively enhanced.Hengwang Cable continues to advance its rooftop solar projects

Innovation Beihai: Smelting Furnace Waste Heat Recovery Project

Traditional Energy Conservation

Innovation Beihai implemented technical upgrades for smelting furnace waste heat recovery introducing high-efficiency

regenerative burner technology. This system utilises heat storage media to recover heat from high-temperature flue gas

preheating ambient combustion air to a temperature just 100°C lower than that of the furnace flue gas thereby achieving a

The Company is continuously advancing technical upgrades for energy conservation and carbon reduction. By identifying opportuni- significant improvement in combustion efficiency. Since the project’s commissioning the Company has reduced annual

ties for carbon reduction optimising production processes and enhancing equipment energy efficiency it is continuously strengthen- natural gas consumption by 1 million cubic metres substantially lowering production energy consumption.ing the internal momentum of green manufacturing.

49 50Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

The Company actively explores additive manufacturing technologies which not only effectively shorten R&D cycles but also enable

the integrated forming and lightweight manufacturing of complex precision components. Through additive manufacturing processes

Innovation Renewable: Waste Heat Power Generation Upgrade Project material utilisation rates can be increased from 30%?60% in traditional subtractive processes to over 90%. Currently the Company’s

additive manufacturing products focus on high-precision components empowering high-end application scenarios such as aero-

Innovation Renewable implemented a technical upgrade for waste heat power generation upgrading the heating medium space biomedicine industrial automotive and consumer electronics.to a low-boiling-point organic working fluid and introducing a magnetic levitation turbine-generator integrated unit for

power generation. This project has substantially improved thermal energy conversion efficiency with an estimated annual Through the synergistic advancement of process optimisation and additive manufacturing technology the Company has achieved an

electricity generation of 12 million kWh. Through the efficient recovery of industrial waste heat the project saved 3788 85% reduction in aluminium alloy usage for comparable products alongside a substantial decrease in carbon emissions. It continues

tonnes of standard coal annually and reduced carbon dioxide emissions by 9441 tonnes achieving a win-win outcome of to provide the industry with high-performance low-carbon green material solutions thereby supporting the high-quality develop-

energy recycling and low-carbon benefits. ment of a green industrial chain.Yunchuang Alloy: Multi-faceted Approach to Promoting Refined Energy-Saving Management

To further reduce electricity consumption Yunchuang Alloy procured new energy-efficient sawing equipment and optimised

its operating parameters. By combining staff consolidation with shift adjustment strategies the Company implemented

centralised management of multiple sawing machines significantly reducing idle time. Operational data indicates that for

every sawing machine reduced the Company saves approximately 39000 kWh of electricity per month.Furthermore Yunchuang Alloy installed water temperature monitoring devices on the cooling towers in the casting

workshop to enable precise temperature control ensuring equipment is only activated when set thresholds are reached

thereby effectively reducing unnecessary electricity consumption. The Company also carried out external insulation Additive Manufacturing Process

upgrades on its homogenisation furnaces to enhance thermal retention minimise heat loss and achieve a year-on-year

reduction in gas consumption of 1.5 m3.R&D and The Company independently develops formulations for aluminium alloy powders and creates 3D digital

Design models to directly drive the production process thereby achieving seamless integration between design and manufacturing.Inner Mongolia Yuanwang: Smart Control Upgrade and Energy Efficiency Improvement for

Smelting Furnaces Powder Utilising the VIGA (Vacuum Induction Gas Atomisation) process the Company independently produces

Preparation micron-sized aluminium alloy powders ensuring the quality of raw materials remains stable and

Inner Mongolia Yuanwang thoroughly explored the energy-saving potential of the smelting process by retrofitting the controllable.furnace with an automatic control system. The Company prioritised the installation of high-efficiency heat storage devices

to improve furnace chamber temperature uniformity and thermal utilisation efficiency with an estimated annual reduction

Additive Utilising a high-energy laser beam to melt and deposit material layer by layer along a cross-sectional path in natural gas consumption of approximately 600000 m3. Furthermore the project is equipped with furnace doors and dust

Forming combined with coordinated control via a multi-layer airflow field system to ensure forming accuracy and recovery systems effectively reducing fugitive dust emissions by approximately 80% and further optimising process consistency.performance.Process Real-time monitoring of the printing status via powder spreading inspection systems and oxygen content

Monitoring alarm systems ensures a stable and safe operation of the process.Material Conservation

Closed-loop Excess powder is transferred under inert gas protection to a collection tank screened and returned to the

Powder Manage- powder supply system achieving full isolation between personnel and powder and enabling continuous

Innovation New Material implements a resource-conservation philosophy by establishing a new production system achieving a ment recycling.transition and optimisation from extrusion to forging processes. This transformation has effectively overcome the material consump-

tion constraints of the original production model marking an upgrade from‘ Process 1.0’ to‘ Process 2.0’. Based on the final product

geometry the Company has optimised the raw material form from round ingots to square billets and adopted a production method Following heat treatment and surface finishing the formed components are transformed into fully dense

combining forging with minimal CNC finishing. This has effectively optimised the machining path for high-deformation precision Solidification high-strength solid products that meet the requirements of high-end applications.components reduced machining allowances and significantly lowered scrap generation and resource wastage.

51 52Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Application Decarbonisation: Unleashing New Industry Exchange and Industry-Academia-Research Integration

Momentum for the Green Industry

We actively build open and shared platforms for industrial exchange joining hands with partners across the supply chain to unleash

new momentum for the green industry and drive the global aluminium sector towards a carbon-neutral future.Green Product Applications

Deepening ASI Collaboration to Build a Responsible Aluminium Value Chain

The Company demonstrates a strong understanding of the urgent demand for green supply chains in downstream industries. By fully

utilising hydropower-based aluminium wind and solar power-based aluminium and recycled aluminium resources the Company In July 2025 the Company showcased its high strength and toughness

develops low-carbon and zero-carbon aluminium alloy products thereby enabling end clients to achieve value chain emission aluminium alloy products at the 2025 International Aluminium Industry

reduction targets. Exhibition- Aluminium China highlighting applications across 3C electron-

ics automotive power grids and aerospace sectors. During the exhibition

In the 3C consumer electronics sector the Company continues to achieve technological breakthroughs. By optimising material Dr Fiona Solomon Chief Executive Officer of the Aluminium Stewardship

properties and iterating process parameters the Company has successfully enabled the mini PC products to achieve carbon neutrali- Initiative (ASI) and her delegation visited the Company’s exhibition stand

ty for the first time and enter large-scale production. The Company has pioneered the application of clean recycling technology for to gain a detailed understanding of the Company’s globalisation strategy

plastic-containing aluminium scrap in consumer electronics production significantly reducing carbon emissions across the product’s and ASI certification plan. Dr Solomon recognised the Company’s

entire life cycle. practices in green raw material sourcing renewable energy application

and the establishment of a closed-loop recycling system for recycled

In the automotive lightweighting sector the Company accelerates the research development and certification of materials for key aluminium. She expressed her expectation that the Company would

components such as side sills crash beams and battery packs with products already in use across domestic and international continue to expand its ASI certification coverage jointly refine the Dr Fiona Solomon visits the Company’s

vehicle models. By supplying high-strength high-toughness lightweight aluminium alloy materials the Company effectively supports Responsible Aluminium standards and contribute further to the sustain- exhibition stand

the reduction of vehicle weight and the enhancement of energy efficiency in new energy vehicles. able development of the global aluminium industry.Showcasing the“ Renewable Energy ? Recycled Materials ? Zero-Carbon Smart We maintain close collaboration with leading domestic universities and research institutions focusing on joint research intoManufacturing” Paradigm at the Expo cutting-edge topics such as pathways to carbon neutrality the efficient utilisation of renewable energy and the construction of digital

zero-carbon factories. We are committed to bridging academic research and industrial application transforming cutting-edge

As a member of Apple’s supply chain the Company participated the 3rd China International Supply Chain Expo in July 2025 theories into practical outcomes that drive the green upgrading of the industry.showcasing the outstanding achievements of China’s manufacturing sector in its transition towards green and intelligent

transformation. The Company established a closed-loop system for the recycling of scrap aluminium and its 100% grade-re-

taining utilisation. It has developed green electricity-based aluminium projects utilising hydropower wind power and

photovoltaic energy and worked with partners to advance process optimisation and technological innovation. This has led

to the successful realisation of grade-retaining utilisation of recycled aluminium the production of low-carbon aluminium

alloys and the continuous refinement of equipment and processes. In the future the Company will continue to deepen its University-Industry Collaboration: Building a Zero-Carbon Aluminium Supply Chain

low-carbon supply chain cooperation with key partners such as Apple supporting the large-scale development of high-per-

formance low-carbon aluminium alloy products. In 2025 a delegation of staff and students from Tsinghua University visited

Innovation Precision to conduct a practical research activity themed“Research on Pathways for Zero-Carbon Aluminium Manufacturing Plants:Based on Clean Electrification” focusing on enhancing carbon neutrality

capabilities. The delegation visited the production sites including the

scrap aluminium recycling workshop the R&D centre and the automated

warehouse to gain a systematic understanding of the Company’s

innovative practices in areas such as recycled aluminium utilisation and

the construction of zero-carbon factories. With zero-carbon aluminium

production as their research objective the university and the Company

jointly evaluated the carbon reduction potential and economic benefits of

various clean electrification schemes identified challenges regarding key Tsinghua University staff and students

equipment upgrades and cost constraints and ultimately proposed visits the production site

development pathways and key performance indicators for a zero-carbon

aluminium factory providing guidance for the subsequent implementa-

tion of the project.Photo from the Chain Expo

53 54Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Green and Low-Carbon Building a Shared Home

? Planning and Implementation: Formulates annual plans in accordance with decisions made by

Environmental Compliance Management the Board of Directors and management and drives the implementation of environmental protection policies and plans across subsidiaries.? Inspection and Rectification: Organises specialised inspections routine inspections and hazard

Health identification; maintains hazard register and tracks rectification progress.Safety and ? Compliance and Support: Monitors environmental laws regulations and standards; provides

Environment technical support to subsidiaries; organises environmental awareness training.Innovation New Material consistently regards environmental protection as a key task for the Company’s sustainable development. (HSE) ? Coordination and External Communication: Coordinates internally with production technical

We comply with laws and regulations such as the Environmental Protection Law of the People’s Republic of China the Atmospheric Pollution Department and equipment departments to fulfil environmental responsibilities; cooperates externally

Prevention and Control Law of the People's Republic of China the Water Pollution Prevention and Control Law of the People’s Republic of China with regulatory authorities regarding inspections and data submission.and the Law of the People’s Republic of China on the Prevention and Control of Environmental Pollution by Solid Wastes whilst continuously

optimising its environmental management system and enhancing its environmental risk control capabilities.In 2025 the Company continued to refine its internal management systems revising and publicly releasing the Environmental

Management System Policy and formulating the Monitoring Data Quality Management System covering areas such as pollution prevention

and control resource conservation environmental risk management and supply chain environmental management. To strengthen ? Policy Implementation and Target Allocation: Implements policies and work plans issued by

environmental protection management for external contractors the Company issued the Environmental Protection Notice to all the Health Safety and Environment (HSE) Supervision Department and ensures the achieve-

external construction personnel clearly outlining the primary environmental protection responsibilities of external contractors and ment of environmental protection targets.the Company’s management requirements. By the end of 2025 14 factories had obtained ISO 14001 Environmental Management ? On-site Management and Emissions Control: Responsible for the day-to-day management of

System certification achieving a coverage rate of 82%. production sites and the control of environmental risk points and emission points.Subsidiary ? Hidden Hazard Identification and Record Management: Conducts daily environmental risk and

HSE Depart- hazard inspections and drives the implementation of corrective measures.ments ? Training Awareness-Raising and Emergency Response: Organises environmental protection

Environmental Management System training for staff develops specific response plans and conducts drills.? Data Collection and Traceability: Standardises the collection of environmental data and the

management of daily records.Innovation New Material adheres to a management approach of“top-level coordination mid-level execution site-level implementa-tion and full participation” establishing a three-tier environmental Through the above system the Company has established a closed-loop mechanism of“ decision-making execution supervision andmanagement structure comprising“ the Board of Directors and assessment” continuously enhancing its environmental governance capabilities and compliance management levels.management the HSE Supervision Department and the HSEdepartments of each subsidiary” ensuring that environmental

responsibilities are cascaded down through each level and that

management measures cover the entire process. The Strategy and Environmental Risk Assessment and

ESG Committee of the Board of Directors serves as the highest

authority for the Company’s environmental coordination and Management

supervision overseeing issues including waste gas emissions

wastewater discharge waste disposal water resource utilisation

energy utilisation and biodiversity conservation.The Company conducts environmental risk assessments in accordance with relevant technical guidelines and standards for environ-

mental risk control such as the Technical Guidelines for Environmental Risk Assessment of Construction Projects and the Method for

Classifying Risks of Sudden Environmental Incidents in Enterprises. It identifies key environmental risks and opportunities and implements

Innovation New Material’s Environmental Management Structure and Responsibilities graded and categorised control measures to ensure precise risk prevention and control.? Planning and Policies: Approves medium- and long-term plans annual targets and core Risk Assessment

policies.? Major Matters: Approves major capital investments major risk response plans and contingen-

cy plans. Innovation New Material has established an integrated environmental risk assessment mechanism encompassing three forms:

Board of ? Resource Provision: Ensures the allocation of human resources funding technology and regular assessments dynamic assessments and specialised assessments which are jointly carried out by internal working groups

Directors and equipment. and external organisations or industry experts. By cross-analysing the conclusions of internal and external assessments the Company

Management ? Compliance Oversight: Ensures compliance with laws regulations and supervisory require- continuously identifies management weaknesses incorporates identified issues into a rectification list sets clear rectification

ments and mitigates major environmental risks. deadlines thereby forming a closed-loop management system. In 2025 the number of issues identified during internal environmental

supervision and inspection decreased by 29.63% with a rectification rate of 100%. In 2025 the Company commissioned third-party

organisations to conduct assessments of the standardised environmental management of hazardous waste at its subsidiaries with all

subsidiaries achieving a 100% compliance rate.

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Forms of Risk Assessment

? Regular Assessments: The Company conducts a comprehensive risk assessment at least once a year covering all production

processes environmental protection facilities potential risk points etc. Hengwang Cable Conducted Emergency Drill for Waste Gas Treatment Equipment Failure

? Dynamic Assessments: The Company conducts dynamic assessments immediately in the event of upgrades or modificationsto environmental protection facilities adjustments to the boundaries of sensitive protected areas in the vicinity or the In October 2025 Hengwang Cable organised an“ Emergency Drill for Wasteoccurrence of environmental incidents or non-compliant emissions. Gas Treatment Equipment Failure”. This drill simulated on-site response

? Specialised Assessments: The Company conducts specialised assessments of high-risk areas such as hazardous waste storage scenarios following a failure of the waste gas treatment system helping

and waste gas treatment systems every six months. relevant personnel familiarise themselves with the emergency response

procedures. The Company simultaneously evaluated the feasibility of its

Risk Assessment Entities environmental emergency response plan identifying and addressing any

? Internal Assessments: Internal working groups comprising environmental protection production technical and safety weaknesses. The drill effectively enhanced staff safety awareness enabled

departments carry out risk identification rectification tracking and verification of the feasibility of contingency plans. employees to understand emergency procedures and improved emergen-

? External Assessments: The Company engages qualified third-party organisations or industry experts annually to conduct cy response capabilities.assessments thereby enhancing the independence and objectivity of the assessments.Hengwang Cable Emergency Drill

Risk Management

Environmental Training

Based on the results of environmental risk assessments the Company has established a risk classification and categorisation

management system. By defining risk levels and categorising risk types the Company has formulated and implemented differentiated

control mechanisms aimed at achieving dynamic risk prevention and control as well as efficient risk response.The Company places great emphasis on the continuous improvement of employees’ environmental awareness and compliance

capabilities. In 2025 the Company systematically organised 47 environmental training sessions covering topics such as environmen-

tal laws and regulations environmental management systems risk and emergency response procedures pollution prevention and

Risk Grading Management control technologies standardised hazardous waste management and biodiversity conservation. A total of 18594 employee

? Major Risks (risks that may trigger mass incidents cross-regional pollution or significant economic losses): Develops attendances were recorded covering all levels of the Company and all staff in environmental management-related roles. Through

dedicated contingency plans assigns dedicated teams and implements 24-hour monitoring. methods such as classroom sessions on-site briefings and case studies the Company helped employees stay abreast of the latest

? Significant Risks (risks that may cause localised pollution or result in regulatory penalties): Designates responsible environmental regulations and policy requirements at both national and local levels thereby effectively enhancing their awareness of

departments reviews progress on rectification measures monthly and strengthens the operation and maintenance of environ- environmental compliance and responsibility awarenessz.mental protection facilities.? General Risks (risks with a limited scope of impact and easily rectifiable): Manages through daily controls by frontline staff

with quarterly inspections.Risk Categorisation Management In 2025 The Company conducted a total of 47 environmental protection training sessions with 18594

? Emissions-related Risks: Strengthens supervision and inspection establishes a daily patrol mechanism and utilises online employee attendances

monitoring systems to achieve targeted control over pollutant emissions and facility operations.? Hazardous Waste Leakage Risks: Constructs standardised storage facilities and conducts regular leakage drills.? Emergency Response Risks: Refines emergency response plans stockpiles emergency supplies and conducts regular drills.Environmental Emergency Management Yuanwang Electrotechnics Conducted Specialised Environmental Compliance Training

In July 2025 Yuanwang Electrotechnics organised specialised environmen-

tal compliance training focusing on systematic explanations of environ-

mental laws and regulations operating procedures for environmental

During this Reporting period Innovation New Material continued to improve its environmental emergency management system. protection equipment and hazardous waste management. Through this

Based on the results of environmental risk assessments the Company organised the preparation of safety risk reports for pollution training employees gained a deeper understanding of the requirements

control facilities and emergency response plans for sudden environmental incidents. At the same time the Company established an for environmental emergency response plans effectively enhancing their

environmental emergency response team equipped it with necessary emergency supplies and organised regular emergency drills in compliance awareness and operational compliance. The training covered

accordance with the‘ three-tier prevention and control’ requirements. In 2025 the Company conducted a total of 45 emergency drills 298 production-related staff members achieving a 100% participation

for sudden environmental incidents including hazardous waste leakage natural gas leakage and fire accidents effectively enhancing rate and enhancing employees’ overall environmental protection

the emergency response capabilities and coordination of all employees. capabilities.Yuanwang Electrotechnics Environmental

Compliance Training

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Green and Low-Carbon Building a Shared Home

2026 Air Emissions Management Targets

Pollutant Discharge Reduction ? By 2026 the Company will ensure 100% compliance with emission standards for sulphur dioxide nitrogen oxides and particulate matter.? By 2026 the Company’s emission concentration of sulphur dioxide will be below 90% of the limit value for new

pollution sources specified in the Integrated Emission Standard of Air Pollutants (GB16297-1996).? By 2026 the Company’s emission concentration of nitrogen oxides will be below 55% of the limit values for new

pollution sources specified in the Integrated Emission Standard of Air Pollutants (GB16297-1996).The Company strictly complies with national and local laws and regulations regarding the management of emissions of various ? By 2026 the Company’s emission concentration of particulate matter will be below 90% of the standard limit value

pollutants including waste gas wastewater and noise and continuously improves the standardisation level of emissions manage- specified in the Integrated Emission Standard of Air Pollutants (GB16297-1996).ment. The Company adheres to a control framework based on the principle of“ top-level coordination mid-level execution site-levelimplementation and full participation” establishing a three-tier management structure comprising“ the Board of Directors andmanagement the HSE Supervision Department and the HSE departments of each subsidiary” thereby clarifying the responsibilities

for pollutant management at each level. The Company’s Strategy and ESG Committee of the Board of Directors serves as the highest

authority responsible for the control of waste gas wastewater and noise pollution overseeing the Company’s annual management

plans targets and progress. The Company’s senior management is responsible for guiding the day-to-day implementation of waste

gas wastewater and noise management plans and for monitoring and managing monthly changes in performance indicators. Limit values for new pollution

Types of Air sources under the Integrated Company’s Actual

The Company formulates monitoring plans covering waste gas wastewater and noise in accordance with environmental impact Pollutants Emission Standard of Air Pollutants Emission Concentration

assessment documents for construction projects as well as technical specifications and standards for environmental monitoring (GB 16297-1996) in 2025

such as the Technical Speci?ications for the Application and Issuance of Pollutant Discharge Permits and the Technical Guidelines for

Self-Monitoring by Pollutant Dischargers. The Company organises monthly quarterly or annual monitoring in accordance with the

monitoring plans and maintains original monitoring data in a standardised manner. During this Reporting period the Company’s

self-monitoring implementation rate was 100% with compliance rates for waste gas emissions wastewater and noise all at 100% Sulphur Dioxide 550mg/m3 ≤50mg/m3

and the on-time submission rate for compliance reports was 100%.The Company installs and operates automatic monitoring equipment in accordance with legal and regulatory requirements ensuring

that the equipment complies with national standards and is connected to the network of the competent ecological and environmen-

tal authorities. During this Reporting period the operational rate of the Company’s Continuous Emission Monitoring System (CEMS) Nitrogen Oxides 240mg/m3 ≤100mg/m3

and Water Quality Monitoring System (WQMS) was 100% and the compliance rate of monitoring data was 100%.The Company regularly conducts environmental safety risk assessments of its environmental protection facilities maintains environ-

mental safety risk registers and continuously improves its environmental compliance management level. During this Reporting Particulate Matter 120mg/m3 ≤10mg/m3

period all types of pollution control facilities operated stably with emissions of waste gas wastewater and noise consistently

meeting regulatory standards. The Company’s production bases are all located within local industrial parks far from residential areas

and densely populated zones with minimal impact on the surrounding environment and communities.The Company has implemented a series of waste gas management measures driving a continuous reduction in pollutant emissions

through the simultaneous upgrading of technology and equipment.Air Pollution Control

? Precision configuration of treatment facilities: Based on the characteristics of different pollutants the Company

In accordance with the Atmospheric Pollution Prevention and Control Law of the People's Republic of China the Company has formulated upgraded low-pressure pulse high-efficiency baghouse dust collectors wet dust collectors and oil mist and flue gas

and continuously refined its Waste Gas Pollution Prevention and Control Management Policy. In 2025 all categories of air pollutants purification systems to ensure efficient treatment of particulate matter and volatile organic compounds in waste gas.achieved 100% compliance with emission standards and the total emission volume met the requirements for total pollutant control. Following the replacement of the low-pressure pulse baghouse dust collectors dust removal efficiency increased by

Building upon compliance with relevant national emission standards the pollutant emission concentrations at some subsidiaries 0.5% compared to pre-upgrade levels with particulate matter emission concentrations consistently maintained

were further reduced compared to local regulatory limits with reductions exceeding 40%. below 5 mg/m3.? Advanced treatment of smelting waste gas: A lime powder injection system and alkali spray system were installed

to enable the synergistic treatment of acidic gases such as sulphur dioxide and fluorides.? Energy conservation and emission reduction in the combustion system: The smelting furnace employed

regenerative combustion technology to recover waste heat from waste gas for preheating combustion air enabling

high-temperature low-oxygen combustion. This reduces fuel consumption whilst effectively lowering nitrogen oxides

emission concentrations.? Source control of fugitive emissions: The aluminium dross separation equipment was replaced with a high-effi-

ciency rotary kiln increasing dust collection efficiency to over 99% and further reducing the impact of on-site dust.

59 60Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

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Innovation Sheet Materials Upgraded Dust Removal and Smelting Processes to Reduce Noise Control

Pollutant Emission Intensity

In 2025 Innovation Sheet Materials upgraded its existing baghouse dust collectors by replacing filter bags with high-stan- In accordance with the Law of the People’s Republic of China on the Prevention and Control of Noise Pollution the Company has formulated

dard filter bags. The new bags feature acid and alkali resistance as well as high-temperature resistance. Following the and implemented the Noise Pollution Prevention and Control Management Policy continuously strengthening the control of industrial

upgrade particulate matter capture capacity was significantly enhanced effectively reducing particulate matter emission noise at source and process control. During the equipment selection phase the Company prioritised the use of low-noise equipment

concentrations. At the same time the Company installed a high-efficiency molten aluminium recovery unit reducing the to reduce noise generation at source. For high-noise equipment such as fans and air compressors the Company installed damping

number of ash scrapers and exhaust stacks thereby further lowering pollutant emission intensity. Particulate matter pads and soundproof enclosures and implemented necessary enclosure measures to reduce the noise impact of equipment

emission intensity decreased by 5% year-on-year whilst sulphur dioxide emission intensity decreased by 0.1% and nitrogen operation. The Company paved the roads within the factory premises fitted vehicles with silencers and implemented speed limits to

oxides emission intensity by 1%. reduce noise disturbance during transportation operations. Through these measures daytime noise emissions at the factory

boundary are consistently maintained below 65 dB(A) whilst night-time emissions are consistently kept below 55 dB(A) thereby

meeting the relevant requirements of the Emission Standard for Industrial Enterprises Noise at Boundary.Wastewater Management Green and Low-Carbon Building a Shared Home

Standardising Waste Management

In accordance with the Water Pollution Prevention and Control Law of the People’s Republic of China the Company has formulated and

implemented the Wastewater Pollution Prevention and Control Management Policy continuously strengthening wastewater treatment

and discharge management. The Company strictly enforces the separation of rainwater and sewage continuously improving

wastewater treatment and reuse level to ensure that all pollutants in the wastewater consistently meet regulatory standards. In 2025 Innovation New Material strictly complies with laws and regulations such as the Law of the People’s Republic of China on the Prevention

the Company achieved 100% compliant discharge of wastewater with 14 factories obtaining ISO 14001 certification. The Company’s and Control of Environmental Pollution by Solid Wastes and the Regulations on the Prevention and Control of Environmental Pollution by Solid

production and operations do not involve the generation or discharge of acid mine drainage. Waste and continuously improves its solid waste management system. The Company has formulated the General Solid Waste

Management Policy and the Hazardous Waste Management Responsibility Policy clearly defining the responsible entities and duty

requirements for the generation collection storage and transportation of waste.

2026 Wastewater Management Targets Progress in 2025 The Company has established a three-tier management structure comprising the“ Waste Management Leading Group ? HealthSafety and Environment (HSE) Supervision Department ? HSE Departments of Subsidiaries”. The Waste Management Leading Group

comprising the Strategy and ESG Committee of the Board of Directors and senior management oversees the overall planning of the

? By 2026 the Company will ensure 100% compliance with ? In 2025 the Company achieved 100% compliance Company’s waste management and the implementation of relevant policies. The HSE Supervision Department is responsible for

wastewater discharge standards. with wastewater discharge standards. coordinating supervision inspection and monitoring activities identifying and controlling key risks in a timely manner and conduct-

? By 2026 the Company’s wastewater recycling rate will be no ? In 2025 the Company’s wastewater recycling rate ing regular training for subsidiaries. The Health Safety and Environment Departments of each subsidiary are responsible for the

less than 60%. was 55%. classification source reduction and centralised disposal of waste within their respective subsidiaries.At sites with in-house wastewater treatment systems the Company installs metering devices at discharge points and commissions 2025 Waste Management Targets 2025 Achievement

external monitoring every six months to ensure that the volume and quality of effluent meet regulatory standards. For key discharging

units the Company installs automatic online monitoring systems at wastewater discharge points to monitor effluent quality in real ? 100% compliance rate for the disposal of hazardous waste ? Achieved

time ensuring consistent compliance with discharge standards. ? 100% on-site retention rate for general industrial solid waste ? Achieved

(aluminium shavings scrap offcuts scrap aluminium blocks)

In terms of industrial wastewater management the Company employs a comprehensive approach combining on-site treatment

co-disposal and cascading reuse to achieve wastewater reduction.? Yunchuang Alloy operates an on-site wastewater treatment system achieving 100% wastewater reuse and zero discharge.? Mengchuang Light Materials adopts a co-disposal model where wastewater is treated using facilities at neighbouring enterprises

and then reused within its own production systems achieving zero external discharge. 2026 Waste Management Targets Progress in 2025

? At bases such as Innovation Metal and Innovation Sheet Materials wastewater from pure water production is collected and

settled before being used for site greening road sprinkling and washing. In 2025 reuse rates reached 60% and 80% respectively.Mengchuang New Materials Inner Mongolia Yuanwang and Chuangyuan Renewable collected industrial wastewater into cooling ? 100% compliance rate for the disposal of hazardous waste ? 100% compliance rate for the disposal of hazard-

water tanks and reused it entirely in production achieving a 100% recovery rate. ous waste

? Innovation Foil Chuanghui New Material and Liwang Precision all achieved a 100% wastewater reuse rate. ? Resource utilisation rate of hazardous waste exceeds 95% ? Resource utilisation rate for hazardous waste

exceeded 90%

Regarding domestic wastewater management the Company’s domestic sewage is treated in grease traps and septic tanks to meet ? 100% on-site retention rate for general industrial solid waste ? 100% on-site retention rate of general industrial

regulatory standards before being discharged into the municipal sewerage network thereby minimising environmental impact. (aluminium shavings scrap offcuts scrap aluminium blocks) solid waste (aluminium shavings scrap offcuts

scrap aluminium blocks)

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Management of General Solid Waste Hazardous Waste Management

The Company classifies general solid waste into two categories: general industrial solid waste and domestic waste and implements The Company has established a dedicated Hazardous Waste Management Group headed by the General Manager to drive

standardised management according to these categories. The Company maintains records for industrial solid waste with utilisation closed-loop management of hazardous waste throughout its entire life cycle from generation to disposal. The hazardous waste

value fully documenting the type quantity flow storage utilisation and disposal of solid waste to ensure full traceability throughout handled by the Company includes waste oil aluminium dross dust from dust collection systems waste emulsion and waste cutting

the process. Regarding packaging materials the Company actively collaborates with downstream transportation companies and fluid. The Company implements categorised record-keeping segregated storage and refined management based on the characteris-

clients to promote the recycling of packaging items such as used wooden pallets and waste paper cores working together to reduce tics of each type of hazardous waste. The Company has strengthened hazard identification and inspection mechanism for hazardous

the generation of waste packaging. As for domestic waste the Company sorts and centrally collects domestic waste from the factory waste treatment facilities and carried out regular waste audits and ledger maintenance to ensure the stable operation of these

premises and transfers it to the environmental sanitation department for regular collection and disposal. facilities. The Company strictly manages the transfer and disposal of hazardous waste entrusting its standardised disposal to

third-party organisations with the appropriate professional qualifications. In 2025 the Company achieved a compliance rate of 100%

In 2025 the Company achieved 100% on-site reuse of offcuts scrap profiles and aluminium shavings generated during the produc- for the disposal of hazardous waste.tion process.The Company adheres to the principle of source reduction minimising the generation of hazardous waste as much as possible

through equipment innovation process upgrades and the establishment of recycling systems.Yunchuang Alloy Promoted Secondary Recycling of General Solid Waste Liwang Precision has commissioned two new phosphoric acid recycling units to enhance its

phosphoric acid recovery and recycling levels. During this Reporting period the Company’s

procurement of new phosphoric acid decreased by 43.21% year-on-year whilst the generation of

Yunchuang Alloy joins forces with downstream partners to actively waste phosphoric acid decreased by 30%. For waste phosphoric acid that cannot be reused in the

promote the secondary recycling of general solid waste. In 2025 the Liwang original production process the Company expanded diverse internal and external utilisation

Company recycled a total of 790 used oil drums whilst the volume of Precision channels using it in the production of cleaning and personal care products water treatment agents

reused waste materials including cardboard boxes packaging bags metal surface treatment materials and building material additives.wooden pallets scrap iron and steel bars reached 411.32 tonnes. This

effectively enhanced the resource utilisation level of general solid waste

and reduced the pressure on waste disposal.Mengchuang Light Materials explores the potential for the recycling of waste cutting fluids. By

Yunchuang Alloy Promotes the Recycling introducing high-speed centrifuge equipment the Company effectively removes impurities such as

of General Solid Waste metal particles from waste cutting fluids restoring them to production standards. During this

Mengchuang Reporting period the Company’s waste cutting fluid recycling rate exceeded 90% whilst the

Light Materials volume of waste cutting fluid generated decreased by 89.95% year-on-year.Innovation Sheet Materials Achieved Resource Recovery through Scrap Iron Core Recycling Innovation Beihai continuously enhances its capacity for the resource utilisation of aluminium

dross. It has constructed a new rotary kiln for aluminium dross separation and adopted a dual-pro-

cess approach of“ ball milling and screening + manual screening” for refined sorting ultimately

In 2025 Innovation Sheet Materials recovered and reused iron cores embedded in purchased small coils at the casting and Innovation achieving a 6% increase in aluminium recovery rate compared to previous levels.rolling workshop with a total of 63.16 tonnes of recycled iron cores. This reduced the procurement of iron additives by an Beihai

equivalent amount effectively improving resource utilisation efficiency.The Company collaborates with hazardous waste disposal operators holding comprehensive utilisation qualifications to enhance the

recycling value of waste and reduce the discharge of hazardous waste. In 2025 the Company achieved 100% resource utilisation of

aluminium dross dust collector ash oil-containing diatomaceous earth nickel-containing sludge and waste mineral oil.? Aluminium dross: The Company utilises high-temperature or wet processing methods to convert it into high-val-

ue-added products such as smelting additives and water treatment chemicals whilst incorporating an ammonia

recovery system to ensure the entire treatment process is rendered harmless.? Nickel-containing sludge: The Company uses specialised extraction techniques to recover nickel for the production

of recycled products whilst the treated sludge residue is utilised in the manufacture of building materials.? Waste mineral oil: The Company utilises refining and purification processes to produce high-quality mineral oil for

use in the blending of high-purity oils or for general industrial applications.? Oil-containing diatomaceous earth: The Company treats oil-containing diatomaceous earth using a pyrolysis

process to separate the oil from the earth with the recovered earth used as a raw material for construction.

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Collaborating with Partners to Achieve the Advanced Resource Utilisation of 2026 Water Resource Management Targets Progress in 2025

Aluminium Dross Excluding natural evaporation the Company’s circulating Excluding natural evaporation the Company’s circulating

cooling water utilisation rate reaches 100%. cooling water utilisation rate reached 100%.Innovation New Material has established in-depth cooperation with specialist partners to jointly explore pathways for the

comprehensive resource utilisation of aluminium dross. Relying on mature integrated pyrometallurgical and hydrometallur-

gical processes the Company converts aluminium dross generated during production into high-value-added products such

as calcium aluminate polyaluminium chloride and ammonium sulphate. This model precisely addresses the challenge of

ammonia emissions from aluminium nitride in aluminium dross achieving targeted recovery and resource utilisation of

harmful components. Through this industrial symbiosis that turns waste into valuable resources the Company reduces Water Resource Risk Management

emissions of hazardous waste and transforms environmental protection costs into product revenue while contributing to a

green circular economy.Innovation New Material adheres to a multi-source water supply strategy primarily utilising water from the municipal network

supplemented by water from the Yellow River for production purposes. Water sources are not located in water-scarce regions or water

The Company organises specialised training sessions on the standardised management of solid waste and pollution prevention source protection zones. During this Reporting period the Company did not undertake any new projects in drinking water source

responsibilities systematically enhancing employees’ compliance awareness and professional management capabilities thereby areas or sensitive zones nor did it experience any operational disruptions caused by water scarcity.further consolidating the effectiveness of standardised solid waste management.The Company conducts annual water resource risk assessments using the AQUEDUCT Water Risk Atlas to identify whether its

operational areas fall within high-risk water resource zones and formulates targeted response strategies based on the findings. The

Company regularly assesses future water availability and quality using hydrological data and climate models to forecast supply

trends and optimise production layout. The Company concurrently carries out impact assessments on local stakeholders to ensure

Hengwang Cable Specialised Training on“ Waste Reduction at the Workplace” that water abstraction and usage practices are aligned with the livelihood needs of the community. The Company continuously

monitors potential future regulatory changes regarding water use at the local level adjusting compliance strategies in advance to

effectively address policy uncertainties and is committed to achieving coordinated development with the region’s water resource

In April 2025 Hengwang Cable conducted specialised training on the theme of“ How to Reduce Waste at My Workplace”. carrying capacity whilst safeguarding operations.Through case studies and on-site explanations the training identified the sources of waste in each production process andoutlined specific reduction measures at the workplace level. In the wire drawing and stranding processes employees Regarding groundwater and soil protection the Company adheres to the principle of“ source control and zoned prevention andreduced the generation of metal shavings by standardising threading operations and optimising tension control to lower control” dividing the plant site into key anti-seepage zones general anti-seepage zones and simple anti-seepage zones. In high-riskwire breakage rates. At the same time the Company strengthened daily equipment inspections and maintenance to prevent areas such as hazardous waste storage facilities the Company employs dual engineering measures comprising“ HDPE impermeablelubricant leaks and required all metal scrap to be placed in dedicated collection bins to avoid contamination with oil. In the geomembranes and impermeable concrete” to effectively block pollution pathways. The Company has established groundwater

extrusion process employees reduced excess material by strictly adhering to standardised procedures for machine start-up monitoring wells downstream of the site and conducts routine monitoring at least twice a year to ensure water quality meets the

shutdown and material changeovers. This training further enhanced staff awareness of waste reduction and improved requirements of Class III under the Groundwater Quality Standards.operational compliance.To safeguard the health of employees’ drinking water Innovation New Material strictly adheres to the Drinking Water Management and

Control Procedure. The Company regularly cleans and disinfects water supply facilities and commissions third-party organisations to

conduct water quality testing covering key indicators such as colour turbidity pH and faecal coliforms thereby ensuring the safety of

drinking water.Green and Low-Carbon Building a Shared Home

Optimising Water Resource Utilisation Water Metering Management and

Discharge Monitoring

Innovation New Material attaches great importance to the efficient use of water resources and strictly complies with laws and

regulations such as the Water Law of the People’s Republic of China the Water Pollution Prevention and Control Law of the People’s Republic

of China and the Water Conservation Regulations. The Company has established and implemented the Water Use Management Policy and

the Water Resources Management Plan integrating water conservation requirements into the entire production and operations. In 2025 The Company has installed metering devices at key water intake and

the Company did not experience any adverse incidents related to water resources management. discharge points establishing a three-tier metering management

system covering the main water inlet company level and workshop

The Company continues to refine its water resource management framework. The Strategy and ESG Committee of the Board of level thereby achieving precise metering and real-time data tracking.Directors serves as the highest authority for water resource management responsible for overseeing the Company’s overall water The Company conducts quarterly statistics and analysis of water intake

resource management. The Water Resource Management Leading Group comprising senior management is responsible for and discharge volumes to provide a basis for water management and

coordinating departments such as production equipment and procurement identifying key water-consuming processes and water-saving improvements.potential risks of wastage driving the implementation of water-saving measures and regularly reviewing water resource manage-

ment targets.

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Conservation and Recycling Green and Low-Carbon Building a Shared Home

Biodiversity Protection

The Company focuses on reducing fresh water intake and increasing reuse rates whilst continuously advancing the retrofitting of

water-saving and consumption-reducing facilities.Ecosystems form the foundation upon which human survival and development depend. Innovation New Material regards the

protection of biodiversity as a vital component of its corporate social responsibility. The Company takes proactive measures to

minimise the negative impact of its operations on ecosystems and is committed to contributing to the conservation and restoration of

? Yunchuang Alloy collects rainwater for production based on local climate conditions reducing average monthly fresh biodiversity.water use by 47.21%.? Innovation Precision utilises reverse osmosis and ion exchange processes to produce purified water and collects the

clean effluent generated during this process for reuse in washing and road sprinkling reducing annual fresh water use

by 5475 tonnes. Management Systems and Structure

? Liwang Precision recycles condensate for use in the boiler room saving 3300 tonnes of fresh water annually.Additionally the Company utilises the concentrate from the purified water treatment system for flushing toilets in the

staff accommodation and watering greenery on the factory premises achieving annual water savings of approximate-

ly 6000 tonnes.? Liwang Precision has upgraded its anode line washing system. Water collected from the daily replacement of water in The Company adheres to international and domestic biodiversity conservation frameworks such as the Convention on Biological

the washing tanks is pumped via submersible pumps to be recycled in washing processes with lower water quality Diversity the Kunming-Montreal Global Biodiversity Framework and the China National Biodiversity Conservation Strategy and Action Plan

requirements reducing daily water consumption from 180 tonnes to 145 tonnes and saving 11600 tonnes of pure (2023–2030) and has formulated and published the Innovation New Material Biodiversity Conservation Statement and the Biodiversity

water annually. Conservation Management System. The Company commits to avoiding deforestation and refraining from conducting operations in

ecologically sensitive and fragile areas whilst requiring suppliers to comply with the Company’s relevant management measures

regarding biodiversity conservation. The Company’s operational sites do not overlap with ecologically sensitive areas such as

national parks nature reserves World Natural Heritage sites nature parks or ecological protection red lines; the Company’s

production and business activities do not have a significant adverse impact on ecosystems or biodiversity.The Company places great emphasis on fostering water conservation awareness among staff continuously organising training on

water management and holding“ water-saving brainstorming sessions” to encourage frontline employees to propose feasible Innovation New Material has established a three-tier biodiversity management system comprising the“ Board of Directors ? Manage-measures for water-saving. For proposals that are evaluated and adopted the Company offers incentives thereby promoting a shift in ment ? Specialist Departments”. The Strategy and ESG Committee of the Board of Directors as the highest decision-making body is

water management from institutional constraints to voluntary action. In 2025 the Company collected and implemented eight responsible for overseeing major biodiversity matters and monitoring the progress of management’s implementation. Management

water-saving ideas from frontline employees providing incentives to 15 staff members. is responsible for driving the implementation of the biodiversity strategy including setting specific targets and coordinating cross-de-

partmental resources. At the level of specialist departments biodiversity conservation working groups have been formed comprising

the Health Safety and Environment (HSE) Supervision Department and the HSE departments of subsidiaries which are responsible

for day-to-day management project execution and risk management.From“ Constant Running Water” to“ Water on Demand”: Employee Proposals Drove

Water-Saving Upgrades

During a company-wide water-saving proposal campaign initiated by Innovation Precision employees observed water Risk Assessment and Management

wastage caused by continuous flushing in some of the factory’s toilets. Consequently they proposed specific measures

including the installation of smart infrared sensors and the implementation of water-saving retrofits. The Company attached

great importance to this proposal and upgraded the original continuous-flow system to a sensor-activated on-demand

water supply. This retrofit significantly reduced unnecessary water use achieving annual water savings of 5940 tonnes. For existing operational sites and their surrounding areas Innovation New Material has established a biodiversity risk assessment

process comprising“ identification - evaluation - control - monitoring” and conducts risk assessments and reviews on a regular basis.Biodiversity Risk Assessment Process

Innovation Sheet Materials Conducted Company-wide Training on Water (1) Scope Definition and Context Identification: Define the assessment boundaries collect information on ecologically sensitive areas

Conservation Awareness and protected species in the vicinity of the project and establish an ecological baseline.

(2) Dependency and Impact Analysis: Systematically identify potential risk points from two dimensions: the Company’s dependency

Innovation Sheet Materials organised a specialised“ Energy and Water Conservation” training session for all staff. The on ecosystems and its impact on ecosystems. Risks related to dependency and impact considered by the Company include species

training provided a systematic explanation of the importance of water conservation and drawing on practical scenarios decline caused by air and water pollution as well as the intentional unintentional and natural introduction of alien species.from both production and office environments introduced specific feasible water-saving measures and practical methods. (3) Risk Assessment and Prioritisation: Classify risks into tiers based on factors such as impact severity and probability of occurrence

Through case studies and behavioural guidance it effectively enhanced employees’ understanding of the sustainable use of and identify priority management targets.water resources. Employees have enhanced their awareness of water conservation in their daily work actively reducing (4) Mitigation Measure Development and Monitoring: Following the mitigation hierarchy of“ avoidance - reduction - regeneration -unnecessary water use and implementing water-saving practices. restoration - transformation” the Company develops specific control measures for different operational sites establishes monitoring

indicators and creates a closed-loop management system.

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

In 2025 the Company utilised the Biodiversity Impact Assessment (BIA) tool drawing on the Natural Observation Species Distribution

Database the IUCN Species Distribution Database the KBA Database and the WDPA Database to identify the distribution of endan-

gered species within a 5-kilometre radius of 12 operational sites including Innovation Metal Innovation Sheet Materials Yuanwang Safeguarding the Azure Coast Building an Ecological Barrier Together

Electrotechnics and Chuanghui New Material. We also analysed the impact of the Company’s operations on the surrounding

environment and ecosystems from the perspectives of hydrology soil vegetation biology and natural resources and compiled the In 2025 Liwang Precision organised more than 20 employee volunteers toBiodiversity Assessment Report. Based on the results of biodiversity impact identification and risk assessment we formulated updated carry out an environmental campaign titled“ Safeguarding the Azureand implemented the Biodiversity Action Plan fully integrating ecological protection requirements into business decision-making and Coast Building a Beautiful Home Together” along the coastline near the

operational practices. In 2025 the Company did not identify any significant impact on biodiversity at its operational sites or proximity Company’s premises. Working in groups the volunteers cleared plastic

to critical biodiversity areas; the comprehensive assessment result for biodiversity risks was low. bottles foam debris and discarded fishing nets from rocky areas while

collecting cigarette butts and packaging bags from footpaths to prevent

Throughout the entire lifecycle of new projects—from planning and construction to operation—we systematically incorporate waste from harming marine life. The campaign collected over 20 bags of

national ecological protection red lines and relevant regulatory requirements. We commission qualified third parties in advance to marine litter which not only significantly improved the coastal environ-

conduct biodiversity impact assessments identifying potential risks such as air emissions water disturbance and alien species. We ment but also enhanced employees’ awareness of marine and biodiversity

establish management procedures for wastewater exhaust gases noise solid waste and hazardous chemicals to ensure that the conservation demonstrating the Company’s commitment to supporting

implementation of new projects does not adversely affect local biodiversity. ecological construction.The Company concurrently assesses the dependence and impact of its aluminium processing operations as well as those of its Liwang Precision organised volunteers to

upstream and downstream value chain on natural ecosystems particularly the ecological impacts of water consumption and bauxite collect marine litter.mining as well as the potential disturbance to surrounding habitats caused by emissions. Building on this we further analyse the risks

such as operational disruptions tighter regulatory controls and market access restrictions that may arise from biodiversity degrada-

tion while identifying green growth opportunities through the development of low-carbon aluminium recycled aluminium and

eco-friendly products. The assessment results will serve as a key basis for the Company to optimise its production capacity layout

deepen its green supply chain initiatives and participate in nature conservation actions.During the raw material acquisition phase the Company prioritises the purchase of ASI-certified raw materials requiring suppliers to

strictly avoid ecologically sensitive areas during bauxite mining refrain from encroaching on nature reserves and critical habitats and

carry out ecological restoration upon completion of mining operations. During the production and processing phase we continuously

monitor key pollutants within the plant premises to minimise their impact on surrounding biodiversity while implementing greening

projects to promote regional micro-ecological balance. At the product recycling stage the Company establishes a closed-loop

recycling system with clients to implement the recycling of aluminium scrap.Innovation Metal Innovation Beihai and Mengchuang New Materials respectively organised employee volunteers to carry out

Selected Biodiversity Mitigation Measures of the Company environmental protection public welfare activities creating clean spaces for biological habitats.? Avoidance: When selecting sites for new projects the Company proactively avoids nature reserves key biodiversity

areas World Heritage sites and habitats of endangered species.? Reduction: The Company implements measures to reduce pollutant emissions and conserve resources thereby

minimising disruption to the surrounding ecosystem.? Regeneration: The Company plants vegetation around the plant premises to enhance ecological functions.? Restoration: The Company carries out targeted restoration of affected habitats such as installing artificial nesting

boxes for birds.? Transformation: The Company provides biodiversity conservation training to all employees incorporate biodiversi-

ty conservation requirements into our supplier qualification criteria and work with partners to drive collective

transformation.On the 2025 International Day for Biological Diversity Innovation Suzhou Chuangtai installed bird nests in Tongli National

New Material organised an awareness-raising campaign themed Wetland Park creating ecological stopovers for migratory birds

“Coexistence of All Things Harmony and Sustainability”. and supporting wildlife conservation.Yunnan Innovation Alloy installed bird nests in key areas of the

Heiba Migratory Bird Corridor in Kaiyuan providing nesting and

breeding sites for birds within the nature reserve.

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03

Technology-Led

Jointly Driving

Innovation

Against the backdrop of technology driving industrial transformation

Innovation New Material continues to refine its R&D and innovation

mechanisms strengthen the systematic protection and transformation of

technological achievements and comprehensively advance the intelligent

upgrading of production processes focusing on building corporate

competitiveness centred on technology. At the same time the Company is

deepening the construction of its full-chain quality management system.By strengthening process control and optimising service systems it drives

continuous improvements in product quality and client satisfaction

forming a development model where innovation-led growth and quali-

ty-based support advance in tandem.

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Technology-Led Jointly Driving Innovation Direction of Digital and Intelligent System Layout

Accelerating Digital and ? Enterprise Resource Planning（ERP）：Integrates business and financial data to achieve end-to-end closed-loop management

“from order to delivery”.Intelligent Transformation ? Manufacturing Execution System (MES): Deploys functions such as production order management product work instruc-

tions and process operation platforms to issue track and record production instructions in real time.? Quality Management System（QMS）：Standardises quality inspection criteria automatically collects quality data and

During the year Innovation New Material focused on the goal of“ digital innovation”， launching a comprehensive digital system enables defect traceability and closed-loop improvement.renewal project. Leveraging three key systems—Enterprise Resource Planning (ERP) Manufacturing Execution System (MES) and

Supplier Relationship Management (SRM)—as key pillars and supported by automated stereoscopic warehouse smart metering ? Warehouse Management System（WMS）：Achieves fully unmanned operations throughout the entire process from material

equipment and industrial robots the Company carried out a comprehensive upgrade of its existing digital infrastructure. Through intake to finished goods dispatch via highly automated stereoscopic warehouse and flexible logistics systems integratingprocess re-engineering data integration and business collaboration the Company has further unlocked the potential of“ operational intelligent stacker cranes and conveyor lines.excellence + smart manufacturing” driving a leap forward in lean and intelligent capabilities.? Supplier Relationship Management（ SRM）：Provides online lifecycle management of suppliers from admission and evalua-

tion to optimisation ensuring that raw material quality delivery and costs remain under control at all times.Top-level Design ? Metering System：Interfaces with weighbridge hardware to automatically collect weights and print weighbridge tickets

preventing human interference and data errors or omissions.? Data Platform and Data Analytics：Establishes integrated decision-making reports and data dashboard.Innovation New Material has established a three-tier digital governance structure comprising the“ Board of Directors ? Operations? Industrial Robots：Large-scale deployment of industrial robots across multiple stages including extrusion casting and surfaceCentre ? Specialist Working Groups”． The Strategy and ESG Committee of the Board of Directors oversees the Company’s digital

treatment to achieve automated cutting precision loading and unloading intelligent handling and labelling.strategy and objectives; the Operations Centre led by senior executives is responsible for coordinating resources formulating

roadmaps and spearheading the construction of digital platforms. Under the Operations Centre are the Product Design Group and

? Unmanned System：Enables fully unmanned management of the entire process from vehicle entry to exit by identifying

the Architecture Development Group: the former is responsible for standard-setting team development platform design and

license plates retrieving pre-bound information creating weighing tasks linking material details and automatically assigning

operations while the latter focuses on architecture design technology selection unified development standards security and

unloading points thereby enhancing logistics efficiency.compliance data collaboration and system integration.The Company has firmly anchored its digital transformation strategy around the core principle of“ serving the Company’s overall Achievements of Digital and Intelligent System Applications by Innovation New Materialobjectives” building a digital operational system characterised by full-chain integration real-time perception and intelligent

decision-making. It drives decision-making through data and institutionalises internal controls via standardised processes thereby

continuously enhancing operational efficiency. The Company plans to establish six major standardised and full-platform application ? Eliminating Information Silos：Standardises data formats and master data specifications achieves real-time cross-system

systems including ERP MES and SRM while deploying intelligent production equipment and integrating the entire supply chain synchronisation and accumulates reusable corporate-level data assets.spanning procurement production warehousing logistics and finance. This will build a unified data asset base to drive operational

decisions with data forming a“ data - insight - improvement” management closed-loop. ? Strengthening Quality Control：Collects key parameters online provides real-time alerts and supports forward and

backward traceability shortening defect resolution times.ERP MES QMS WMS SRM ? Supporting Flexible Manufacturing：Dynamically distributes work order parameters and achieves rapid production line

changeovers to meet the demands of small-batch and multi-batch orders.Enterprise Resource Manufacturing Quality Management Warehouse Management Supplier Relationship

Planning Execution System System System Management

? Data-driven Decision-making：Builds an analytics platform to make strategic and operational metrics visible in real time

enhancing decision-making efficiency.? Platform-based Scalability：Encapsulates core capabilities as microservices allows new business scenarios to be invoked via

Metering Data Platform and Industrial Unmanned assembly and shortens functional iteration cycles.System Data Analytics Robots System

Layout Directions and Application Effectiveness of Digital

Intelligence Systems

Eliminating Strengthening Supporting Flexible Data-driven Platform-based

Information Silos Quality Control Manufacturing Decision-making Scalability

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Implementation Service Optimisation

Leveraging the data dashboard the Company integrates end-to-end data covering order production warehouse operations logistics

distribution etc. and provides clients with access to order progress tracking portals enabling them to view real-time production

In 2025 the Company completed the rollout and operation of ERP and MES systems in selected subsidiaries while simultaneously

status dispatch information and logistics tracking. The ERP system captures client requirements and in conjunction with the MES

completing the prototype design for the SRM system. In 2026 the Company plans to roll out the ERP and SRM systems across all

system enables rapid response to customised order requests. In 2025 the Company’s delivery cycle for customised orders was

remaining subsidiaries achieving a unified platform unified portal unified standards and unified business norms at the corporate

shortened by approximately 35% significantly enhancing its service reputation.level.Leveraging the seamless integration of the three core systems—ERP MES and SRM—the Company is transforming“ data” into a new

factor of production spanning planning execution and collaboration thereby achieving operational upgrades and value leapfrog-

ging in key scenarios.MES-WMS-QMS Trinity: Building a Transparent and Efficient Smart Manufacturing Hub

In 2025 Innovation Metal launched an integrated MES WMS and QMS system achieving the seamless integration of data

and business flows. Upon receiving orders from the ERP system the MES automatically matches them with process routes

and generates electronic work instructions which are displayed paperlessly on process operation platforms. The process

operation platforms are interconnected with IoT devices such as weighbridges etc. capturing real-time weighing data and

automatically recording it in the MES system thereby enhancing warehousing efficiency and data accuracy. Operating as a

subsystem of the MES the WMS manages warehouse inventory transfers and sales shipments in real time ensuring

first-in-first-out (FIFO) principles and inventory visibility. The QMS simultaneously retrieves inspection procedure templates

automatically generates inspection tasks and links them to MES sample codes completes inspection assessments and

provides minute-level localisation of quality anomalies. The three systems share material batch and furnace numbers;

through electronic guidance automated work allocation and real-time data collection they reduce paper-based records

prevent quality defects lower inventory backlogs and achieve standardised transparent management.Innovation Precision Launched Process Stability Improvement Project to Make the Entire

Production Chain“ Predictable Controllable and Traceable”

In 2025 Innovation Precision collaborated with downstream clients on a process stability improvement project. Through

standardised processes data monitoring error-proofing mechanisms and automation upgrades the Company reduced

Smart Manufacturing parameter fluctuations and human error in the production process thereby continuously enhancing product quality and

production efficiency.? Regarding MES system deployment modules covering production execution equipment management quality

The Company’s ERP system features modules for production planning process management working hour recording qualitymanagement warehouse management etc. enabled end-to-end control across the“ planning-production-equip-inspection control etc. enabling real-time monitoring of production progress. The MES system breaks down production plans issuedment-energy” chain resulting in a 12.5% improvement in material turnover efficiency.by the ERP system into process-level tasks and intelligently optimises production scheduling and dispatch by combining real-time

? In terms of automation 134 units/sets of automated equipment were added or retrofitted to enable functions such as

equipment data thereby preventing any disconnect between production planning and execution. Intelligent unmanned handling

automatic loading and unloading automated production automatic measurement automatic report generation etc.equipment within the stereoscopic warehouse coordinates in real time with the MES system to deliver production materials on

increasing the proportion of automated equipment to 85.96%.demand and on time significantly reducing waiting times on the shop floor. Thanks to this end-to-end digital control the Company’s

? Regarding the error-proofing system process parameter recipe management and out-of-specification alarm functions

production scheduling efficiency increased by approximately 30%.were implemented gradually shifting from“ post-event inspection” to“ preventive intelligent interception” with recipe

and out-of-specification alarm coverage reaching 76.46%.? Regarding SPC data analysis the Company monitored production processes through data to provide early warnings of

Supply Chain Management fluctuations stabilise product quality and reduce cost wastage; the relevant functionalities have been fully developed.The Company’s ERP system centrally compiles material requirements plans and issues precise purchase orders while simultaneously

verifying raw material quantities with suppliers via the metering system to ensure procurement accuracy. The stereoscopic ware- The Company has extensively adopted intelligent and automated equipment. Fully automatic coding machines assign unique codes

house monitors inventory in real time and the ERP system conducts optimisation analyses based on real-time stock levels effectively to aluminium billets for precise traceability; automatic palletisers stack finished products; robotic arms for automatic billet feeding

preventing both stock accumulation and shortages. Through end-to-end data coordination across procurement production precisely grasp and feed materials according to MES instructions; and intelligent stereoscopic warehouse facilitate automatic

warehousing distribution etc. the Company has achieved transparency of supply chain information. In 2025 supply chain response material flow under WES scheduling significantly enhancing production efficiency.speed increased by approximately 52% while the risk of supply chain disruptions was reduced and stability was enhanced.

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

The Company’s Intelligent Equipment Drives Production Quality Innovation Precision Recognised as a National Excellence-Level Smart Factory

and Efficiency Improvements

In 2025 through continuous innovation and in-depth practice in the field of smart manufacturing Innovation Precision was

successfully awarded the title of“ National Excellence-Level Smart Factory” by the Ministry of Industry and Information

Technology becoming a benchmark enterprise for intelligent transformation within the aluminium processing industry. By

deploying a Manufacturing Operations Management (MOM) system the Company achieved end-to-end digital control

spanning production planning and scheduling production execution equipment monitoring and energy management.Leveraging its manufacturing process stability projects it strengthened quality control and full-process traceability

capabilities. The Company introduced a stereoscopic warehouse to achieve the automated management of finished

products and moulds and operated a laser engraving and marking automatic production line to enhance product identifi-

cation accuracy and production efficiency. Currently Innovation Precision has established a digital and intelligent manage-

ment system covering the entire R&D and manufacturing chain gradually forming a new intelligent manufacturing ecosys-

tem characterised by efficiency collaboration and green development.High-precision coding equipment assigns a unique The intelligent palletising robot can adapt to products

identifier to every product ensuring full traceability of of varying sizes and weights while dynamically

product information and adding a‘ safety lock’ to adjusting according to production instructions

quality control right from the source. demonstrating a high degree of flexibility and

intelligence.Innovation Precision’s Intelligent Production Line

The billet-loading robotic arms handle the automatic The intelligent stereoscopic warehouse utilises

picking and feeding of aluminium alloy billets; automated equipment such as high-speed stackers to

combined with a real-time monitoring system they achieve real-time synchronisation of material

ensure the precision and stability of the feeding information and precise storage and retrieval serving

process. as a highly informatised and intelligent logistics hub.

2025

? Innovation Precision was recognised as a National Excellence-level Smart Factory passed the China Manufacturing

Maturity Model (CMMM) Intelligent Manufacturing Maturity Assessment (Level 3) and was designated as a Shandong

Provincial Advanced-level Smart Factory.? Innovation Sheet Materials was designated as a pilot unit for the 2025 Digital Economy“ Morning Star Factory”

construction.案例间距

National Excel- Shandong Provincial 2025 Digital Economylence-level Advanced-level “Morning StarSmart Factory Smart Factory Factory”

Dual-head high-speed wire drawing equipment can process raw materials of larger diameter through multiple

drawing passes to produce wire with smaller diameters higher precision and superior surface quality. Innovation Precision Innovation Precision Innovation Sheet Materials

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Talent Development Technology-Led Jointly Driving Innovation

Adhering to Innovation-Led

In response to the urgent demand for versatile talent arising from digital and Development

intelligent transformation Innovation New Material has incorporated the strat-

egy of“ Strengthening the Enterprise through Talent” into its core strategy and

the Company continues to refine its multi-tiered training system through mea-

sures such as the deep integration of industry academia and research theInnovation New Material adheres to the technological development philosophy of“ technological leadership collaborative innova-joint development of high-end platforms and frontline skills enhancementtion and low-carbon recycling”. Guided by the principles of independent innovation high-end products and client needs the

etc. systematically cultivating a new generation of professionals who under-

Company proactively undertakes research projects and leads the formulation of technical standards. By accelerating process

stand both manufacturing processes and intelligent technologies.optimisation and equipment iterations the Company comprehensively enhances its innovation capabilities and the industrialisation

of technological achievements. Furthermore the Company systematically advances its patent portfolio injecting momentum into the

In 2025 the Company launched tiered digital technology and intelligent

rapid growth of both the Company and the industrial chain. At the same time the Company integrates ethical guidelines throughout

empowerment training for team leaders key personnel and frontline opera-

the R&D lifecycle strictly adhering to risk red lines to ensure that technological innovation remains compliant controllable and

tors covering key system operation points process requirements risk areas

sustainable.and emergency measures. The Company arranged practical exercises to

reinforce learning and compiled digital system operation manuals tailored to

different roles. During the initial rollout of the system the Company encour-

The Company has established a three-tier governance structure for scientific and techno-

aged employees to report operational issues through various channels such as

logical innovation comprising“ decision-making management and execution”. The

WeChat groups and face-to-face feedback sessions etc. The Operations Centre

decision-making tier is overseen by the Strategy and ESG Committee of the Board of

categorised and summarised these issues and addressed them according to Digital System Training

Directors; the management tier features the Innovation Alloy Research Institute led by

priority. Upon resolution the Company proactively provided feedback to the Governance

senior executives; and the execution tier relies on Engineering and Technology Centres for

reporters ensuring that“ every issue received a response”.the five major product lines—bars profiles wire flat rolled products (FRP) and structural

components. These centres extend to all production subsidiaries forming a full-chain R&D

network covering cutting-edge research applied development and industrial application.Innovation New Material Joined Hands with Tsinghua University to Establish

an Embodied Intelligence Research Centre

Levels Governance Entities Primary Functions Reporting Frequency

In November 2025 the“ Joint Research Centre for Industrial Embodied Intelligence Robotics” jointly established by

Innovation New Material and the Tsinghua University Shenzhen International Graduate School was officially inaugurated

focusing on the industrial application of embodied intelligence robots in industrial settings. The Joint Research Centre takes Decision-making Strategy and ESG Committee of the Board Overseeing technological innovation strategy and /

“cutting-edge technology - industrial commercialisation” as its core thread carrying out collaborative R&D centred on Tier of Directors direction

innovative robot design dexterous manipulation and embodied navigation and control etc. Leveraging the collaborative

chain of“ university R&D + enterprise pilot production + cluster mass production” the Company transfers fundamental

theories and core algorithms from the laboratory to the production line. The Centre will also strive to build a cross-disci-

Formulating technological innovation strategies resource

plinary talent development platform to cultivate leading versatile professionals who are proficient in both artificial intelli- Management Tier Innovation Alloy Research Institute allocation and risk management Every six months

gence and industry. Currently Innovation New Material is undergoing a transition from“ aluminium manufacturing” to Providing end-to-end management for innovation projects

“robot manufacturing” and this university-industry collaboration will inject new momentum into the intelligent and digital

transformation of the manufacturing sector.Allocating resources according to project priority

Execution Tier Engineering and Technology Centres Building R&D teams and conducting personnel training Monthly

Resolving technical issues in R&D and production

The Company strictly adheres to the Shandong Province Scienti?ic Research Integrity Management Measures and complies with codes of

conduct and regulations regarding the management of fiscal research funds. To ensure the authenticity and reliability of research

activities the Company has formulated the Scienti?ic Research Integrity Management System upholding the principles of objectivity

honesty fairness and self-discipline while eradicating scientific misconduct.In addition the Company has established internal regulations including the R&D Project Management System and the Employee-wide

Innovation Incentive Scheme. These create an R&D management framework that covers the entire process from project application and

approval to process control and acceptance and evaluation. The Company continuously refines its mechanisms for research project

management fund utilisation and talent incentives. To standardise procedures the Company has defined clear requirements for

project application and approval budget management plan execution operational standards and deliverables among others for

The official inauguration of the Joint Research Centre for Industrial Embodied Intelligence Robotics.various project types thereby exercising full-process control over all research activities from initiation to final acceptance.

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Innovative Strategic Deployment

The Company has incorporated“ technological innovation” into its material topic management

Strategy process systematically identifying relevant risks and opportunities. The Company has established a

full-process governance mechanism covering assessment monitoring and response to ensure that

risks are kept under control and opportunities are promptly realised. Innovation New Material has established the“ 54321 Pyramid” innovation and development strategy focusing on 5 major product

sectors striving to achieve 4 transformations building 3 communities serving 2 markets and forming 1 green aluminium industrial

chain.Potential Impact Innovation New Material’s“ 54321” Pyramid Innovation

Risk Types Risk Description

and Development Strategy

Operational Impact Financial Impact

The commercialisation of new energy new 3

materials and new processing technologies Rising costs of production line

Increased capital expenditure and

Technology Iteration may outpace the Company’s R&D cycle upgrades loss of orders and

a decline in gross profit margin 4 Fostering employee relations

potentially rendering existing equipment or declining capacity utilisation.based on a“ community of sharedprocesses obsolete.Implementing management interests a community of shared

innovation to drive talent endeavours and a community oftransformation product shared future”;

The development of high-end alloy grades is transformation energy Vision

highly challenging; performance may fail to Project delays and a decline in Rising R&D costs and declining transformation and capital

R&D Failure

meet standards during initial testing or mass yield rates. profits transformation;

production. 1 Industrial

Chain

2

2 Markets

The Company faces the risk of losing key Slowing R&D progress Following an international

Talent Drain personnel such as core materials specialists necessitating the recruitment Rising labour costs development strategy actively

and digital engineers. and training of new staff. 3 Communities expanding into overseas markets

5 whilst maintaining a strong

foothold in the domestic market;

Focusing on high-strength and 4 Transformations

Erosion of technological

Patents for high-end alloy compositions and high-toughness aluminium alloys

advantage emergence of Increased litigation costs and

intellectual property relating to advanced

Intellectual Property 3C electronic materials substitute products with R&D costs

manufacturing technologies may be subject automotive lightweight materials 5 Major Product Sectors

comparable performance and a

to theft or leakage. ultra-high-strength and

reduction in orders. 1

high-conductivity cables and

recycled aluminium;

Supporting the Company in building a

green aluminium industrial chain.Potential Impact

Opportunity

Opportunity Description

Types

Operational Impact Financial Impact Establishment of Innovation Platforms

The Company develops low-carbon

Securing additional orders from

products such as hydro-powered aluminium

Green Product Premium clients and continuously Increasing revenue Innovation New Material has established an“ N+1+N” collaborative innovation model. Relying on the Innovation Alloy Research

and recycled aluminium and obtains

improving capacity utilisation.third-party certification. Institute the Company has built an industry-university-institute cooperation bridge linking universities research institutes its

subsidiaries and major end clients creating a two-way efficient channel for the transformation and application of scientific and

technological achievements and the addressing of research needs.The Company innovates and develops

Increasing market share

technically challenging products to break

Domestic Substitution reducing reliance on imports Increasing revenue

foreign monopolies and enter the supply

and securing more client orders.chains of major clients.Jiangxi University

Tsinghua Central South Shandong Qilu University of

of Science and

The Company deploys AI and digital University University University Technology

applications throughout the entire Technology

Improving yield rates and

Digital Operations aluminium processing workflow to adjust Reducing operating costs

reducing client complaints.process parameters in real time and monitor

product quality.The Company strengthens R&D into

technologies for the grade-retaining Reducing the carbon footprint of

Cost Reduction through

recycling and upgrading of aluminium scrap products to meet client demand Increasing revenue N + 1 + N

Recycling

to enhance its circular value and reduce for green products.product carbon emissions.Universities Innovation Alloy Research Institute Various Subsidiaries

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Innovation New Material has established the“ Model Worker Innovation Studio” and set up provincial-level innovation platforms

including the“ Shandong Provincial Academician Workstation”“ Shandong Provincial New-Type R&D Institution”“ ShandongProvincial Postdoctoral Research Practice Base” and“ Shandong Provincial Enterprise Technology Centre”. The Company has jointly Model Worker Studio Drove Green Intelligent Manufacturing and Talent Development

established the“ Engineering Research Centre for High-Strength and High-Toughness Aluminium Alloy New Materials” and the

“Central South University Master’s Training Base” with the School of Materials Science and Engineering at Central South University. The“ Wu Shengli Model Worker Innovation Studio” was established in December 2021. Focusing on skills competitionsFurthermore the Company has partnered with Hunan University to establish the“ Joint Laboratory for High-Performance Aluminium process optimisation and management innovation it has built a multi-dimensional platform for R&D innovation theAlloys for Automotive Lightweighting” and with Shandong University to create the“ Shandong University Joint Training Base for transformation and application of technological achievements and talent incubation. This has formed a closed-loop cycleCasting Professionals” thus facilitating the incubation of research projects and the cultivation of innovative talents. of“ technological breakthrough - industrial application - talent replenishment” driving the enterprise’s intelligent upgrade.In 2022 the studio was named a“ Qilu Craftsman Innovation Studio” continuously producing skilled craftsmen and

significantly enhancing the Company’s production efficiency and economic benefits.

2025

Fostering an Atmosphere of Innovation

? Innovation Metal and Innovation Precision were selected for the 2025 Shandong Province New Materials Leading

Enterprise Incubation Pool

? Innovation Metal was certified as a National High-Tech Enterprise The Company has formulated the Company-wide Innovation Management System and encourages all employees to participate in

? Innovation Precision passed the re-certification review for National High-Tech Enterprise innovation through various activities such as the“ Striving for Excellence and Meritorious Service” labour competition. To further

? Suzhou Chuangtai’s Core R&D and Testing Laboratory successfully obtained the Laboratory Accreditation Certificate deepen the culture of innovation the Company has simultaneously refined the Implementation and Reward System for Improvement案例间距

issued by the China National Accreditation Service for Conformity Assessment (CNAS) Proposals encouraging employees to propose practical innovation and optimisation schemes based on their respective positions. The

? Hengwang Cable was designated as a Shandong Provincial Specialised Refined Unique and Innovative SME a Company implements a routine process for collecting innovation proposals conducting monthly reviews and categorising initiatives.Binzhou Municipal Industrial Design Centre and a Binzhou Municipal Enterprise Technology Centre. Employees receive tiered rewards based on the effectiveness of adopted projects fostering an innovation ecosystem characterised by

universal participation and continuous improvement.Suzhou Chuangtai Laboratory Achieved CNAS Accreditation Harnessing Frontline Improvement Insights to Unleash Employee Innovation Potential

Elevating Its Technical Capabilities to the National LevelFor three consecutive years Innovation Precision has organised the“ Call for Improvement Proposals and Rational Sugges-In 2025 Suzhou Chuangtai Laboratory was officially accredited by CNAS. This accreditation covered core testing areas such tions” campaign establishing an innovation platform for all employees to participate in business operations and collecting

as tensile testing and Brinell hardness testing of metal materials and their products signifying that Suzhou Chuangtai over 800 proposals. Production technicians have reduced the processing time per unit from approximately 10 minutes to 4

Laboratory’s management standards and technical capabilities have reached national standards. Leveraging CNAS minutes by optimising machining methods and designing specialised cutting tools thereby significantly reducing equip-

accreditation Suzhou Chuangtai Laboratory can shorten the R&D and validation cycle for new products provide testing ment occupancy. Furthermore engineers from the Quality Assurance Department have independently overcome technical

reports with international credibility to domestic and international clients and strongly support the global market expan- challenges in EBSD testing achieving monthly cost savings of over RMB 200000. This series of innovative practices allows

sion of green aluminium alloy products. employees to realise their value through participation while simultaneously driving quality and efficiency enhancements in

production and operations.Suzhou Chuangtai Laboratory

Innovation Precision’s“ Call for Improvement Proposals and Rational Suggestions” Campaign Awards Ceremony

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

R&D Achievements and Applications

Company-wide Innovation Unlocked Development Momentum

Innovation New Material focuses on core technical challenges within the industry as well as the engineering and industrial applica-

Innovation Sheet Materials launched the“ Innovation and Breakthrough” improvement proposal program. Centred on the tion of major scientific and technological achievements. The Company formulates long-term and short-term technical development

theme of company-wide innovation the program encouraged employees to use innovative thinking to resolve production plans and conducts research activities in an orderly manner. The Company prioritises breakthroughs in key chokepoint technologies

pain points thereby driving simultaneous progress in safety quality and efficiency. The program received a total of 22 and key common technologies that the aluminium processing industry urgently needs to overcome with a targeted focus on the

improvement proposals with optimisation areas covering seven categories: enhancing quality and efficiency reducing design and development of lightweight aluminium alloy automotive components and manufacturing process technologies for

costs saving time optimising tooling and equipment improving operational ease improving the environment and mechanical parts. This year the Company has continued to deepen industry-university-institute cooperation and actively engaged in

enhancing safety. Some of the implemented projects have successfully achieved breakthroughs including a reduction in the research for local and national key science and technology projects with some R&D projects being approved as projects under the

product adhesion defect rate the optimisation of annealing processes and a decrease in energy consumption. Shandong Provincial Key R&D Programme.The transformation and application of the Company’s scientific and technological innovations have become a vital engine for

fostering and developing new quality productive forces. At the technical level the Company is continuously driving dual leaps in

material properties and processing technologies achieving the large-scale application of high-strength aluminium alloy materials in

sectors such as new energy vehicles and high-end equipment thereby generating new industrial momentum through technological

iteration. At the industrial level through the development and promotion of key common technologies the Company is upgrading

the aluminium processing industrial chain toward higher added value and higher technological content supporting the sector’s

transition towards intelligent and green operations. At the environmental level by optimising manufacturing processes the Company

is improving resource utilisation efficiency and reducing the environmental footprint of production thereby empowering the

development of a circular economy through green technologies. At the social level the Company is fostering technological progress

and talent development within the industry by driving the coordinated development of the industrial chain and promoting high-quali-

ty employment.

2025

? Innovation Metal’s research achievement Research and Application of Green Low-Energy Consumption and Intelligent

Pre-treatment Technology for Recycled Aluminium was included in the Shandong Provincial Major Scientific and

Technological Achievements Database.Innovation Sheet Materials’“ Innovation and Breakthrough” Improvement Proposal Awards Ceremony

? Innovation Alloy Research Institute in collaboration with Chuanghui New Material and Guangdong Ocean University

undertook the joint research project Development and Industrialisation of Heat-Resistant and High-Conductivity Alumini-

um Alloy Con案du例cto间r M距aterials.? Innovation Metal in collaboration with Shandong University and Qilu University of Technology undertook the joint

research project Research and Development of a Complete Set of Manufacturing Technologies for High-Quality Recycled

R&D Funding Allocation and Safeguards Aluminium Alloys.? Innovation Metal in collaboration with Shandong University and Qilu University of Technology undertook the joint

research project Research and Development of Production and Processing Technologies for Rare Earth Microalloyed

Innovation New Material has formulated the R&D Cost Management Measures Homogenisation-free 6xxx Series Aluminium Alloy Billets.. The R&D Centre and the Finance Department are jointly

? Innovation Metal in collaboration with the Institute of New Materials Shandong Academy of Sciences undertook

responsible for managing R&D funds which includes preparing detailed R&D budget schedules and ensuring the strict management

the joint research project Research and Industrial Application of Preparation Technologies for Large-Diameter Thin-Walled

of funds in accordance with the approved budget. At year-end both departments jointly conduct project final accounting to deter-

Aluminium Tubes Used in Air Suspension Tanks.mine total expenditure ensuring that every project has a budget upon initiation and a final settlement upon completion. In cases of

improper use of R&D funds the Company will hold the responsible parties to account and may recover the planned investment funds

for the project depending on the circumstances. Furthermore the Company will hold the parties concerned legally liable for any

violations of laws and regulations.The Company has established an innovation risk assessment system covering four key dimensions: technological maturity market

demand team capability and compliance. Through unified scoring standards the Company regularly evaluates R&D projects and

dynamically adjusts project strategies based on the resulting assessment reports. During the project initiation phase the project team

must prepare a project initiation report which requires review by the project assessment panel and approval by the General Manager.During the R&D phase the Company reduces the probability of technical failure through prototype testing laboratory validation and

the Company’s resource sharing with universities and research institutions. During the market launch phase the Company conducts

flexible iterations based on client needs while a dedicated compliance department monitors legal updates in real time. This ensures

that the entire process—from R&D and pilot production to application—remains lawful and compliant thereby safeguarding the

smooth implementation of innovation projects.

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Industry-University-Institute Exchanges

Innovation New Material actively participates in industry association exchange activities engaging deeply in association development

through diverse cooperation channels. The Company conducts in-depth discussions with peer enterprises on industry development

trends and technological innovation jointly facilitating the implementation of key projects and promoting overall innovation and

sustainable development within the industry.Name of Industry Association Position Held

China Nonferrous Metals Industry Association Vice President Unit

China Nonferrous Metals Fabrication Industry Association Vice Chairman Unit

China Nonferrous Metals Industry Association Recycling Metal Branch Vice President Unit

Shandong Aluminium Association Executive Vice President Unit

Mr Cui Lixin Chairman of Innovation New Material serves as Chairman of the Binzhou Aluminium Association working with

member enterprises to promote the industry’s green and low-carbon transition and high-quality development.The Company maintains regular technical exchanges and joint talent training programs with universities such as Tsinghua University

and Central South University. Through collaborative research projects joint laboratories and postgraduate practice bases the

Company shares cutting-edge research findings and engineering expertise and facilitates the two-way flow of academic and

industrial talents thereby providing intellectual support for continuous innovation.Liwang Precision Joined Forces with Rhein-K?ster to Launch a Strategic

Partnership for Industrial Talent Cultivation

Tsinghua University Faculty and Students Visited Innovation Precision

to Promote Industry-Education Integration In 2025 Liwang Precision and Rhein-K?ster established a strategic partnership for industrial talent cultivation formally

signing the Strategic Cooperation Agreement for Industrial Talent Cultivation and announced the joint establishment of the

“Skilled Talent Certification Centre” and“ Skilled Talent Training Centre”. This strategic partnership marks a crucial step

In 2025 18 outstanding students from Tsinghua University visited Innovation Precision to participate in a practical pro-

forward for both parties in deepening the integration of industry and education delivering positive outcomes for Liwang

gramme titled“ Ideological and Political Education & Innovation in Practice Reform and Research in Action”. During the

Precision in areas such as skilled talent cultivation automation upgrades for smart manufacturing and equipment

four-day programme the students systematically studied courses on the transformation of cutting-edge R&D achievements

performance enhancement.digitalised production innovations in recycled aluminium production lean manufacturing talent management and

marketing strategies. They also engaged in in-depth discussions with the Company’s leadership on topics such as proposals

for the intelligent upgrading of production lines the opportunities and challenges of automation reform and how enterpris-

es can balance strategy production and publicity. This resulted in three optimisation reports on the Company’s opera-

tions. Adopting an integrated“ industry-university-institute-application” model this initiative facilitated a two-way exchange

between university talents and corporate technical resources thereby injecting innovative momentum into the Company’s

development.? 14 factories have obtained ISO 9001 Quality Management System Certification.? 12 factories have obtained IATF 16949 Automotive Quality Management System Certification.? Mengchuang Light Materials has obtained AS 9100D Quality Management System Certification

for aviation space and defense organizations.? Innovation Precision has obtained ISO 22163 Quality Management System Certification for the

railway industry.Tsinghua University Enterprise Innovation and Reform Practice Team Visited Innovation Precision for Exchange Activities

Signing Ceremony of the Strategic Cooperation Agreement for Industrial Talent Cultivation

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Standards in which the Company has participated in the formulation or revision in 2025：

? Approved standard: Wrought Aluminium and Aluminium Alloy Products—Packing Marking Transporting and Storing

? Approved standard: Optical Emission Spectrometric Analysis Method of Aluminium and Aluminium Alloys

? Approved standard: Molten Aluminium and Aluminium Alloys

? Approved standard: Greenhouse Gas—Quanti?ication Requirement and Method of Product Carbon Footprint—Aluminium

Processing Product

? Published standard: Low-carbon Aluminium-rich and High-strength Ceramsite for Construction

? Published and implemented standard: Alloy Wires Used for the Grain Re?iner for Aluminium and Aluminium Alloys—Part 2:

Al-Ti-C Wires

? Published and implemented standard: Alloy Wires Used for the Grain Re?iner for Aluminium and Aluminium Alloys—Part 3:

Al-Ti Wires

The Company actively collaborates with Central South University on key technical breakthroughs and talent cultivation. This Co-hosting a National Standard Seminar to Support High-quality

year the Company partnered with the School of Materials Science and Engineering at Central South University to launch a Technical Development of the Industry

research project on high-performance aluminium alloy conductors.From 1 to 5 September 2025 a working group meeting for the formulation and revision of five light metal standards

including Wrought Aluminium Alloy Ingots Made from Recycled Aluminium was held in Yunnan Province. The meeting was

hosted by the National Technical Committee for Nonferrous Metals Standardisation and co-hosted by Yunchuang Alloy.Following five days of in-depth discussions significant progress was achieved on the draft standards. Leveraging its

extensive industry data and verification platforms Yunchuang Alloy provided key technical indicators and experimental

cases for the formulation and revision of the standards. This co-hosting not only demonstrated the Company’s high

attention to the formulation and revision of technical standards but also enriched the standard texts with practical

experience contributing innovative solutions to the scientific nature applicability and advanced nature of industry

standards.Intellectual Property Protection

Innovation New Material strictly adheres to laws and regulations such as the Civil Code of the People’s Republic of China the Patent Law of

the People’s Republic of China and the Trademark Law of the People’s Republic of China. The Company has formulated and implemented

the Patent Management System and the Intellectual Property Protection Control Procedures and has established the Intellectual

Property Management Leading Group and the Trade Secret Protection Office. Through measures such as employee training key

Shandong Jianzhu University and Innovation Precision have launched a“ Student Employment and Internship Base” to personnel management and contract risk control the Company continuously improves its intellectual property management system

strengthen industry-academia collaboration. maximising the value of intellectual property in the Company’s development. The Company constantly enhances its capabilities in

independent innovation and the utilisation of intellectual property while ensuring that it does not infringe upon the patents

trademarks copyrights or other intellectual property rights of others.Industry Standards Establishment

Process Management

The Company actively participates in the formulation of technical standards strengthening its standardisation efforts in key areas

such as high-end alloy manufacturing recycled aluminium production and green manufacturing to support high-quality industry The Company’s Information Technology Department is responsible for safeguarding technological security and data

development. This year the Company has actively participated in the formulation and revision of standards relating to recycled privacy through measures such as data encryption and two-factor authentication (2FA). Prior to the initiation of new

aluminium green and low-carbon aluminium wrought aluminium and clean production evaluation indicator systems earning product projects the Technology Centre conducts intellectual property searches and risk assessments. The Company

recognition from the industry for its significant contributions to national non-ferrous metal standardisation work. In the future the tracks IP outputs and protection status throughout the entire R&D lifecycle. All information releases and record archiving

Company will vigorously advance research and the drafting of technical standards continuing to drive and lead high-quality industry require prior approval and controlled filing ensuring process compliance and traceability.development.

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Personnel Management Technology-Led Jointly Driving Innovation

The Human Resources Department conducts background checks on candidates for key and confidential positions. Upon joining

the Company employees sign a Non-disclosure and Non-compete Agreement and upon leaving a post-employment intellectual

property handover and debriefing is conducted and recorded. The Company conducts annual intellectual property protection Strict Product Quality Control

training for relevant personnel combining internal and external training. The Company cooperates with authoritative bodies and

experts for professional lectures while internal training focuses on the creation utilisation and protection of intellectual

property thereby continuously enhancing the risk awareness and professional capabilities of relevant personnel.Innovation New Material takes product quality as the cornerstone of its development adhering to a systematic and lean quality

management model. Guided by client demands the Company continuously enhances quality awareness among all employees and

Risk Prevention and Control optimises full-process control establishing a quality assurance mechanism covering the entire product lifecycle to continuously

improve product performance and reliability. During the reporting period the Company’s product quality remained stable with no

major product-related quality or safety liability incidents.In project collaborations the Company stipulates in business contracts the allocation of intellectual property rights and

confidentiality obligations among all parties. Should any breach of contract or potential infringement be identified during

the collaboration remedial measures are taken immediately or the collaboration is terminated. The Legal Department

provides intellectual property legal advisory services to business divisions promptly identifying and addressing potential

risks to safeguard the Company’s legitimate interests.In 2025 the Company demonstrated outstanding

performance in quality with its achievements gaining

industry recognition. Chuanghui New Material and

Yuanwang Electrotechnics were both honoured as

Impact Risk and Opportunity Management “Outstanding Suppliers of the Shandong Wire and Cable Industry” at the Shandong Wire and Cable Industry

High-Quality Development Conference.The Company has established a systematic mechanism for managing risks and identifying opportunities in scientific and technologi-

cal innovation which is fully integrated into its strategic planning and operational processes. The Company has put in place a

comprehensive framework for managing risks and opportunities throughout the entire innovation cycle—from R&D execution to R&D 段落间距

achievement transformation—clearly defining the responsibilities and decision-making pathways for each stage in risk and opportu-

nity identification assessment and response. Leveraging its information management platform the Company regularly conducts

dynamic tracking and data integration across key dimensions such as R&D investment technological iteration intellectual property

market trends and policy developments. It systematically identifies potential risks in technology roadmaps and assesses the maturity

and market adaptability of emerging technologies providing insights for decision-making. The Company regularly reviews the

technical risks commercial benefits and social impact of ongoing R&D projects and those already transformed feeding the analysisresults back into strategic planning and resource allocation to form a closed-loop management cycle of“ monitoring—analysis—decision-making—optimisation”.Metrics and Targets

To better integrate technological innovation into its strategy and realise long-term value the Company has established the following

technological innovation targets.By the end of 2025

2026 Scientific and Technological Innovation Targets

? Invention patent applications applicable to the Company’s core business: no fewer than 15

? Granted invention patents: no fewer than 5 14 factories have obtained ISO 9001 Quality Management System Certification.? Total granted utility model patents: no fewer than 40 12 factories have obtained IATF 16949 Automotive Quality Management System Certification.Mengchuang Light Materials has obtained AS 9100D Quality Management System Certification for

As of the end of 2025， aviation space and defense organizations.The Company held 534 granted patents comprising 74 invention patents and 460 utility model patents; Innovation Precision has obtained ISO 22163 Quality Management System Certification for the

In 2025 the Company acquired 84 new patents including 14 invention patents and 70 utility model patents. railway industry.

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Innovation New Material continues to deepen its three-tier quality governance structure

Governance consisting of the“ Board of Directors-Management Layer-Execution Layer” and establishes Strategy The Company systematically identifies potential risks and development opportunities in quality

a closed-loop quality control system covering the entire process from R&D procurement management and formulates forward-looking response strategies accordingly.and production to sales.Hierarchy Responsibilities Reporting Frequency

Potential Impact

Risk Type Risk Description

Operational Impact Financial Impact

Board of As the highest decision-making body the Strategy and ESG Committee of the Board oversees

Directors product quality targets and implementation progress. /

Failure to adapt products to the latest

Iteration of industrial International standards undergo standards in a timely manner will lead to

Increased compliance costs

regulations regular annual updates. restricted sales delivery delays damaged

client trust and unstable supply chains.Comprising department heads of production quality control warehousing and other divisions this

Submits quality strategy

Management tier focuses on top-level design and system optimisation. It leads the establishment and efficient

implementation reports

Layer operation of the quality management system and coordinates supplier quality engineering and

every six months.internal quality system audits.Insufficient quality stability of key

Quality fluctuations

raw and auxiliary materials Disruption to production continuity increases

along the upstream Increased production costs and

including refining agents the risk of quality incidents and affects

and downstream procurement expenses

aluminium ingots minor metals on-time order delivery.supply chain

and Al-Ti-B wire.Comprising three core centres—Quality Control Quality Engineering and Quality Assurance — this

tier maintains strict oversight across the manufacturing process. It strictly implements the three-tier

Execution Submit monthly reports on

inspection system: Incoming Quality Control (IQC) In-Process Quality Control (IPQC) and Outgoing

Layer quality control performance.Quality Control (OQC). By utilising digital tools for accurate key data recording it ensures real-time Growing stringent technical

Backward adaptation of technical indicators

feedback and closed-loop resolution of on-site quality abnormalities. requirements regarding chemical

Upgraded require- will make products incompatible with

composition mechanical

ments from high-end market demands resulting in the Decline in operating revenue

properties hydrogen /slag

downstream clients risk of delisting from supplier lists and

content and homogenisation

shrinking market share.effects.段落间距

Potential Impact

Opportunity Type Opportunity Description

Operational Impact Financial Impact

Efficiency Construction of full-process data Effectively reduces manual recording errors

improvement via interconnection and intelligent optimises process parameters and improves Profit growth

digital quality control traceability systems. production efficiency.Entry into high-barrier markets optimises

Penetration into new markets

Expansion into high-end product structure and strengthens the

such as aerospace and Profit growth

application fields Company’s competitiveness in high-end

packaging materials.industrial chains.Enhanced industrial influence Excellent product quality reinforces client

Product quality and

and strengthened core client stickiness expands high-end market share Increased operating revenue

brand development

loyalty. and consolidates industrial leading position.

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Full-Process Quality Control Quality Audit

The Company adheres to international standards including ISO 9001 and IATF 16949 continuously consolidating the foundation of its The Company has established a three-tier audit system covering internal self-inspections third-party supervision and client factory

quality management system. In response to evolving external environments the Company has established a dedicated compliance audits. The Company conducts at least one internal quality system audit and management review on an annual basis while proac-

team and a dynamic global regulatory tracking mechanism to forecast changes in regulatory requirements keeping its management tively accepting external oversight from third-party certification bodies and clients. The audit scope fully covers key links including

system aligned with international advanced practices. supplier management in-process inspection and finished product release.The Company has built a multi-level standard system centred on over 50 technical standards. Among them more than 30 national For issues identified in audits the Company adopts the 8D and 5 Whys (5Y) methodologies to locate root causes of abnormal

standards cover full-process fundamental control to guarantee product safety and basic performance; over 10 industry standards fluctuations and implements standardised rectification procedures to ensure closed-loop resolution. In addition the Company has

target specialised requirements in segmented fields to improve professional adaptability of products. In addition the Company built a systematic product quality improvement mechanism. By collecting and analysing internal and external quality data and

actively introduces advanced international standards such as American and German standards bringing key indicators in line with leveraging tools including regular quality analysis meetings and the FMEA database it identifies improvement opportunities.global levels. Through the strict implementation of this standard system the Company has constructed a systematic and stan- Following expert evaluation improvement plans are formulated and implemented and subsequent result verification and standard

dardised defence line for product quality. revision achieve closed-loop management to drive continuous quality upgrading. The Company holds weekly quality analysis

meetings targeting production issues. In 2025 over 100 items were optimised leading to substantial improvements in product yield.Adhering to the concept of lean manufacturing the Company keeps optimising its closed-loop management system covering

“incoming material control process monitoring and outgoing inspection”.

2025 Quality Audit Statistics of Innovation New Material

Control Stage 2025 Work Highlights

2025年工作亮点 Number of internal quality audits conducted：132 Number of client audits conducted：181

Number of third-party quality audits conducted：61 Cumulative quality improvement items rectified：1080

? Institutional upgrades: Revised the Incoming Inspection Operating Standard to raise admission

thresholds.? On-site audits: The Quality Inspection Department and Procurement Department jointly conducted

quality control carrying out 3?4 high-frequency on-site audits annually for key material suppliers to

strictly control source quality. Quality Optimisation

Incoming ? Tiered management: Implemented refined supplier tiered management to strengthen constraints on

Inspection quality liability clauses.? In-house testing: Established internal testing standards and carried out in-house testing for key Digital Empowerment

auxiliary materials including magnesium ingots refining agents and additives.In 2025 the Company successively launched the Manufacturing Execution System (MES) and Laboratory Information Management

System (LIMS) marking its quality management entering a new stage of digital and intelligent empowerment. Supported by stan-

dardised inspection workflows and centralised data management the systems greatly improve information collection efficiency and

? Hardware upgrades: Newly introduced testing equipment such as handheld flaw detectors LiMCA III provide real-time intuitive data support for management decision-making. Going forward the Company will further integrate

online inclusion analysers and water-immersion flaw detectors to improve detection precision. Statistical Process Control (SPC) functions into its data platform deepen data value mining and construct a predictive quality

? Key control: Implemented full-process quality control for flat ingots and high-end billets with early-warning mechanism. This will enable quality management to evolve from“ post-event inspection control” to“ proactive riskupdated and enforced special control standards. prevention”.In-Process ? Absolute veto power: Quality inspectors hold veto power over identified quality hazards and

Inspection non-conformities against SOPs. They may immediately halt non-compliant operations and supervise

full corrective rectification.? Optimised strategies: Implemented differentiated control measures 100% full inspection for flat

ingot products and strict sampling inspection for aluminium billet products.? Technological upgrades: Adopted Podfa offline inclusion analysis technology. With high-precision

Final filtration and microscopic analysis the technology accurately identifies the type and content of

Inspection inclusions. Process optimisation across the whole chain is guided by analytical data to effectively

improve melt purity.

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Talent Cultivation Industry Exchange

By establishing a systematic empowerment framework and positive incentive mechanisms the Company fosters a culture of pursuing To further cultivate an open and inclusive quality culture the Company actively participates in high-level industrial events such as

quality excellence across all operations. automotive industry associations contributing its“ Innovation Wisdom” to industrial upgrading. In addition the Company regularly

issues quality disclosure reports. With a transparent operational stance it builds an industry benchmark image and commits to

Rigorous skills assessments to verify professional competence co-creating a high-quality industrial ecosystem with partners across the industrial chain.? Quarterly dual assessments: A quarterly skill assessment system covering all quality inspection positions is implemented

combining theoretical examinations and practical evaluations to ensure consistent job competence among employees.? Advanced qualification certification: To strengthen high-precision testing capabilities in 2025 three core specialists from

Innovation Metal obtained Level 2 Ultrasonic Testing qualifications realising qualification upgrading for key technical positions.Participating in Industrial Technical Exchange Conference

Introduction of high-end talents and diversified training system construction

to Empower Quality Control Upgrading

? High-end talent recruitment and cultivation: The Company recruits senior quality and technical talents and delivers targeted

professional training programmes.? External benchmarking exchanges: Adopting the strategy of“ learning externally and introducing expertise internally” the In 2025 the Company was invited to attend the 16th Technical Exchange Conference on Physical and Chemical Testing and

Company carries out specialised training in core fields such as equipment operation and failure analysis continuously bench- Failure Analysis hosted by the Materials Branch of the China Society of Automotive Engineers (CSAE). During the conference

marking against advanced industrial practices. leading industrial experts and enterprises conducted in-depth discussions on core topics including cutting-edge failure

? Internal mentorship system: A mentor team composed of internal technical experts and benchmark employees is established. It analysis technologies and innovative testing methodologies. The Company integrates advanced industrial experience into

delivers structured training including the Furnace Reserve Talent Programme lean management enhancement courses and its internal quality management system optimises testing standards and procedures and further strengthens its risk

professional skills training. Combined with departmental improvement seminars the programme comprehensively upgrades prevention capabilities.staff competence laying a solid human resource foundation for high-standard quality inspection. In 2025 the Company

organised 12 specialised quality training sessions covering all quality-related personnel.Enhanced reviews and competitions to create multi-dimensional value

? Quarterly skills competitions: Quarterly incentive competitions integrating theoretical knowledge and practical operation are Hazardous Substance Management

held to verify and consolidate training outcomes.? Regular quality improvement meetings: A routine mechanism for quality improvement meetings is established to develop

preventive measures for process and finished product defects and continuously optimise standardised process operational

Innovation New Material strictly adheres to regulations and client requirements establishing an integrated control mechanism for

procedures. In 2025 36 quality improvement meetings were held forming closed-loop management from problem identification

hazardous substances that spans raw materials production processes finished products and by-products. The Company sets clear

to quality value enhancement.raw material environmental and quality standards for supply chain partners promoting a collective improvement in hazardous

substance management across the entire value chain.Optimised positive incentive mechanism to stimulate internal initiative

? Performance linkage and recognition: Quality metric achievement and contributions to quality improvement projects are

incorporated into employee performance appraisal. Honorary titles including“ Quality Role Model” and“ Improvement Pioneer”

are awarded to strengthen overall staff awareness of quality responsibilities via positive incentives.As of the end of 2025 seven factories had obtained QC 080000 hazardous substance process management system

certification.Organising QCC Improvement Achievement Selection

to Consolidate Frontline Lean Management Foundations

In the raw material testing phase the Company identifies and classifies environmental risks associated with raw materials in

accordance with the HSF Risk Assessment Management Procedure. The Company commissions qualified third-party organisations to

Suzhou Chuangtai held a Quality Control Circle (QCC) improvement achievement selection event displaying quality conduct specialised testing on key raw materials in accordance with the RoHS Directive (Restriction of Hazardous Substances in Electrical

improvement outcomes of 10 selected frontline projects. Centring on on-site pain points including energy consumption and Electronic Equipment) and the REACH Regulation (Registration Evaluation Authorisation and Restriction of Chemicals and its Amend-

quality fluctuations and equipment failures each project carried out data analysis and pilot optimisation on typical ments). The Company strictly enforces a“ zero-tolerance” policy for hazardous substances; raw materials are admitted to inventory

processes forming a set of replicable operational specifications and management practices. Multiple projects achieved and used only after test results comply with relevant limits.remarkable results in energy reduction product defect rate control and downtime shortening. Through scoring evaluation

and experience-sharing mechanisms the Company promotes outstanding practices and establishes a closed-loop manage- During the manufacturing process the Company strictly enforces the Standards for the Restriction of Hazardous Substances ensuring

ment cycle of“ evaluation—improvement—feedback” consolidating the foundations of frontline lean management. that hazardous substance control requirements are precisely implemented on the production frontline. The Company strictly

monitors key process parameters to ensure a stable and controllable manufacturing process. Should process parameters deviate

from the set range the system automatically triggers an alert or shutdown to facilitate the timely investigation and correction of

abnormalities ensuring controllable process risks.For finished product and by-product testing the Company has established a rigorous factory release testing system based on client

requirements. It conducts necessary component testing and risk assessments on by-products to prevent secondary environmental

risks during subsequent utilisation or disposal building a robust defence line for product safety and environmental compliance.

97 98Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Impact Risk and Opportunity Management Metrics and Targets

The Company has integrated quality risk and opportunity management into its comprehensive risk management process. It has The Company has established clear quantifiable key performance indicators (KPIs) for quality management with actual results

established an assessment team comprising multiple departments including the Quality Management Department Production serving as the measurement standard. As of the end of the reporting period all indicators have met or exceeded the predeterminedDepartment and Procurement Department to form a closed-loop management mechanism of“ identification—analysis—response— targets fully reflecting the Company’s outstanding performance in product quality management and high recognition from clients.monitoring”.Product Current Level Industry Average Level Industry Position

The Company collects quality risks and opportunity information through channels such as client

feedback supplier evaluations internal audits and industry policy tracking creating a dynamic High-strength and high-toughness Tensile strength: 420 MPa Tensile strength: 350 MPa Industry-leading

Identification aluminium alloy information database.Phase

3C electronic profiles Yield rate: 98.4% Yield rate: 97% Industry-leading

The assessment team employs a risk matrix methodology to classify risks into high medium and

low tiers based on probability of occurrence and impact severity. Opportunities are categorised into Lightweight automotive profiles Yield Rate: 97.4% Yield rate: 95% Industry-leading

Grades A B and C based on potential value and implementation difficulty while assessing their

Analysis

impact on business and finance.Phase

High-strength and high-conductivity Resistivity: 29.10 nΩ·m Resistivity: 27 nΩ·m Industry-leading

cables

For high-risk items the Company formulates specific contingency plans clearly defining responsi- High-quality recycled aluminium Impurity size < 20 μm Impurity size < 25 μm Industry-leading

ble departments response measures and completion deadlines. For Grade A opportunities it

Response formulates implementation plans allocates appropriate resources and drives execution.Phase

2026 Quality Management Targets 2025 Progress

The Company tracks the progress of risk responses and opportunity implementation monthly and

organises review meetings quarterly or biannually to dynamically adjust strategies based on

Monitoring 100% product factory qualification rateimplementation outcomes. Achieved

Phase

First-pass inspection qualification rate for cast finished

99.5%

products ≥ 99%

Client satisfaction score ≥ 90 points 99.64 points

99 100Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Concurrently the Company relies on a full-process quality traceability system to conduct dynamic monitoring of potential product

Technology-Led Jointly Driving Innovation

risks. If systemic quality hazards that may affect multiple batches of products are identified the Company will immediately activate an

emergency response mechanism to quickly locate the problematic batches and their distribution and safeguard client rights and

interests through clear solutions and compensation plans. During the reporting period the Company had no product recall incidents

Service Experience Guarantee caused by product quality and safety issues and the amount of damages resulting from major liability accidents related to product and service safety and quality was zero.Innovation New Material adheres to a client-centric service philosophy emphasising that“ client experience is paramount”. The Client Satisfaction Surveys

Company strictly complies with laws and regulations such as the Law of the People's Republic of China on the Protection of Consumer

Rights and Interests and has established a service quality management system underpinned by the Client Requirements Process Control

Procedure Client Feedback Process Control Procedure and Client Satisfaction Survey Control Procedure ensuring the standardisation and

continuous improvement of service processes. Client service quality directly affects the Company’s reputation and client stickiness and ultimately contributes to long-term value

creation and sustainable development capabilities. To this end the Company systematically evaluates service quality and optimises

its management system by establishing a regular client feedback mechanism.Client Feedback and

Service Channels Complaint Resolution ? Annual comprehensive survey：The Company conducts at least one full client satisfaction survey every year.Combining online questionnaires and on-site visits the survey assesses ten indicators across four dimensions:

product quality client service delivery timeliness and hazardous substance management.? Regular on-site communication：Sales staff conduct on-site visits every two months to collect client demands and

The Company has established a systematic client The Company provides diverse client feedback channels and feedback in person maintaining consistent daily communication and relationship maintenance.relationship management system covering the entire communication approaches including email WeChat ? Multi-Departmental comprehensive evaluation：To deepen insights into key clients the Company has set up an

business process integrating resources from internal telephone regular meetings client evaluation platforms and internal cross-departmental evaluation team. The evaluation team carries out systematic scoring for key client

sales field sales and on-site service as well as other team a client complaint handling system actively listening to client products from five dimensions: technology quality delivery compliance and service forming a comprehensive

resources to provide clients with comprehensive needs. To improve the management of client service evaluation system integrating internal and external perspectives.professional support. In 2025 the Company further refined complaint processes the Company has formulated the Client ? Closed-loop feedback management：The Company regularly organises analyses and summarises all feedback

its service grid division to build a more agile and efficient Feedback Process Control Procedure standardising complaint data compiling special reports on product and service improvements. These reports are submitted to the manage-

client response and support mechanism. handling processes and time limits to ensure that client ment team as an important basis for operational decision-making.complaints are dealt with promptly orderly and efficiently.The Company also regularly conducts reviews of complaint

cases and conducts personalised follow-ups based on client

preferences to enhance the client experience.In 2025 the closed-loop resolution rate for

client requests reached 100%。 To ensure timely response to client demands the Company Throughout 2025 the Company carried out multiple client satisfaction surveys with overallhas established a“ three-tier progressive timeframe” client satisfaction remaining steadily above 90%，and the coverage rate of client satisfactioncomplaint handling mechanism: surveys reached 100%.The Company has established a multi-dimensional client

service system integrating online and offline channels with ? Within 24 hours of complaint occurrence：The

front-office and back-office linkage. Regional field sales Marketing Department accepts and registers the

managers provide localised on-site support while the complaint simultaneously transferring it to the Quality Responsible Marketing

internal sales team ensures that client demands are Management Department and relevant responsible

promptly addressed and followed up through a stan- departments; an emergency response process will be

dardised communication matrix comprising telephone activated immediately for major quality complaints.corporate WeChat and dedicated email channels. The ? Within 48 hours：The Quality Management

back-end technical support team—comprising Production Department together with the responsible departments The Company is committed to building a fair and impartial marketing environment. It strictly abides by relevant laws and regulations

Department Quality and Technical Department—can convenes a quality analysis meeting to identify the root to ensure truthful and accurate product promotion and eliminates exaggerated or misleading statements. The Company has

rapidly provide solutions to complex issues forming an cause of the abnormality and the responsible depart- established the Bulk Material Management Committee to oversee marketing activities of all subsidiaries standardise marketingefficient collaborative mechanism of“ front-end ments formulate corrective and preventive measures. procedures prevent improper transactions and protect clients’ legitimate rights and interests. Under the guidance of the Commit-reception—back-end support—closed-loop manage- ? Within 72 hours：The responsible departments tee each subsidiary formulates annual service and sales targets according to its own client structure and actual production condi-ment”. implement corrective actions the Quality Management tions and implements corresponding assessment mechanisms to ensure all marketing activities are compliant transparent and

Department prepares a written improvement report or traceable.submits a written response to the client and tracks the

closure of the complaint process.

101 102Innovation New Material | 2025 Environmental Social and Governance Report

04

Empowering

Employees

Co-creating

ProsperityThe Company adheres to the recruitment principle of “integrity and com-petence with the right person for the right position” and is committed tobuilding a full-chain talent development ecosystem centred on “empow-erment growth and mutual benefit”. Grounded in the core philosophy of

“co-creation and sharing” we have deeply cultivated a “Five GoodnessCulture” with the connotation of “good environment good cuisine goodrecreation good learning and good career prospects”. We strive to create

a healthy safe and harmonious workplace for both work and life thereby

truly realising the symbiotic value between the Company and its employ-

ees.Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Innovation New Material has formulated the Human Rights Policy covering its own business contractors and partners. The policy has

Empowering Employees Co-creating Prosperity clearly defined a series of commitments regarding labour rights including providing employees with a living wage strictly controlling

overtime and excessive working hours establishing reasonable maximum working hours upholding equal pay for equal work

Promoting Diversity and Inclusion between men and women and fully paying annual leave wages. It has also committed to a minimum consultation period or fulfilling advance notification obligations prior to large-scale layoffs.The Company continuously operates the Human Rights Due Diligence Management Procedure regularly conducting systematic human

rights due diligence and impact assessments on its own operations the upstream and downstream value chains and newly expand-

ed businesses (including mergers and acquisitions joint ventures etc.) covering core issues such as forced labour human trafficking

Innovation New Material adheres to a talent philosophy of diversity equality and inclusion strictly complying with international child labour freedom of association collective bargaining rights equal pay for equal work and discrimination. In our own operations

standards and relevant domestic laws and regulations including Universal Declaration of Human Rights United Nations Guiding Principles we focus on reviewing workplace conditions the implementation of policies and the protection of employee rights. At the value chain

on Business and Human Rights Labour Law of the People’s Republic of China Labour Contract Law of the People's Republic of China Law of the level we assess the labour practices of suppliers through online or offline audits. In the early stages of new business collaborations

People’s Republic of China on the Protection of Women’s Rights and Interests Special Rules on the Labour Protection of Female Employees Law we incorporate human rights risk screening into the scope of the investigation. The Company compiles the Human Rights Due Diligence

of the People’s Republic of China on the Protection of Minors Social Insurance Law of the People’s Republic of China. The Company is commit- Report and Human Rights Impact Assessment Report annually formulates special rectification measures for identified risks and revises

ted to establishing a comprehensive human rights and diversity and inclusion management system pledging to provide all employ- management procedures in a timely manner in accordance with updates of international human rights standards and business

ees with equal career development opportunities and competitive remuneration and benefits whilst effectively safeguarding changes thereby continuously enhancing the level of human rights management. All of the Company’s factory areas have formulated

employees’ legitimate rights and interests by continuously broadening communication channels. and implemented human rights risk mitigation plans which include the immediate cessation of infringements the revision of relevant

policies the provision of financial compensation and the provision of necessary psychological counselling or legal assistance.The Company has established a three-tier employee management structure comprising the“ Board of Directors ? Senior Management? Specialised Departments” to ensure the effective implementation and deep penetration of the aforementioned policies. The Company has simultaneously refined its Anti-Discrimination Management and Control Procedure and the Anti-Violence and Anti-Ha-

rassment Policy. Throughout all stages of recruitment and employment the Company prohibits any form of discrimination based on

gender race age religion sexual orientation disability pregnancy marital status or trade union membership. The Company

? Strategy and ESG Committee of the Board of Directors: Responsible for overseeing the overall strategy on diversity and human maintains a zero-tolerance policy towards violence and harassment in the workplace (including sexual and non-sexual harassment)

rights protection. with clear requirements for prevention handling and accountability in order to foster a safe healthy and mutually respectful

? Senior Management: Responsible for formulating and overseeing the implementation of the Company’s policies on diversity workplace environment.equality inclusion and human rights.? Specialised Departments: The Corporate Management Department is responsible for recruitment onboarding training and The Company has formulated the Policy on the Protection of Women’s Rights and Interests and the Procedures for the Protection of

labour relations management and for implementing requirements regarding diverse recruitment fair promotion as well as Female Employees stipulating that all positions suitable for female employees shall be equally open to them. We strictly implements

anti-discrimination and anti-harassment measures. special labour protection measures for female employees during“ pregnancy maternity leave and lactation” and strictly prohibits

the assignment of prohibited tasks. Furthermore the Company has specifically established a comfortable nursing room to provide a

private and comfortable space for rest and breastfeeding for employees thereby effectively safeguarding the rights and interests of

female employees.By 2025 The Company has established the Internal and External Grievance Management and Control Procedure and has publicly disclosed the

complaint channels on the official website. The Corporate Management Department has been designated as the receiving depart-

? The Company employed 27 employees with disabilities ment responsible for registering categorising investigating and tracking feedback on complaints and grievances ensuring that the

? The Company employed 172 veteran employees handling process is open fair and timely. Employees and partners may report incidents of discrimination harassment or human

rights violations observed in the workplace and may also lodge grievances regarding promotion or remuneration outcomes. In

? Assisted employees in financial difficulty with applications for 34 rental accommodation units response to the reports and appeals the Company will immediately launch an investigation and take necessary corrective measures.? Resolved the issue of nearby school enrolment for the children of 45 employees Personnel found to have violated relevant regulations after investigation will be subject to internal disciplinary actions by the

? Provided support to 88 employees in difficulty cumulatively Company. The involved units and responsible persons should provide explanations regarding the rectification plans and where harm

has been caused to the parties concerned liability for compensation shall be borne. In 2025 the Company did not identify any

instances of discrimination or harassment.During the reporting period the Company incorporated human rights anti-discrimination and anti-harassment content into its

company-wide training and new employee induction programmes continuously enhancing employees’ awareness and practice of a

Respecting and Protecting Human Rights culture of diversity equality and inclusion and striving to provide every employee with equal opportunities fair treatment and an inclusive working environment. In 2025 the Company did not experience any labour disputes.Innovation New Material has explicitly committed to respecting and protecting the legitimate rights and interests of all employees

including regular staff flexible workers and contractors. At the same time the Company pays particular attention to the protection of

the rights of vulnerable groups such as women children ethnic minorities migrant workers and indigenous peoples and has

gradually established a labour rights protection practice system covering dimensions such as remuneration working hours and

employment management.The Company has issued the Policy on the Prohibition of Child Labour and the Statement on Modern Slavery strictly prohibiting the

employment of child labour and any form of forced labour human trafficking and debt bondage. It ensures that all employees are of

at least the statutory minimum working age and extends these requirements to business partners and suppliers.案例间距Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Remuneration and Benefits same time the Company has refined regulatory documents such as the Trade Union Management Regulations and the Freedom of Association Management and Control Procedures. Through platforms such as the trade union and the employees’ congress it ensures

unimpeded channels for employees to express their opinions and lodge complaints safeguarding their freedom of association and

collective bargaining rights. By 2025 the coverage rate of the collective bargaining agreement among employees was 100%.The Company strictly adheres to the principle of confidentiality and rigorously protects the personal information of employees who

Innovation New Material strictly adheres to the Working Hours Management and Control Procedure to ensure that employees’ working lodge complaints and fosters a communication environment where employees feel safe willing and able to express themselves

hours comply with national laws and regulations safeguarding their statutory entitlements to paid public holidays marriage leave effectively. In 2025 the Company organised a campaign named“ Innovation Proposal” to solicit rationalisation suggestions collecting

maternity leave bereavement leave annual leave and other categories of leave. The Company has clearly stipulated employees’ over 900 improvement proposals and distributing a total of more than RMB 100000 in rewards thereby effectively driving manage-

working hours as well as the number of days of annual leave as well as various types of leave that the employees are entitled to. The ment optimisation and continuous improvement.daily working hours are set at 8 hours. The Company implements strict controls on overtime monitoring employees’ work status and

overtime hours on a monthly basis analyses the rationality of business operations and personnel allocation and makes improve-

ments. At the same time working hours and overtime standards are determined in accordance with legal provisions and adjusted

based on actual circumstances.Company-wide Democratic Appraisals to Build an Open and Transparent Democratic

With regard to remuneration the Company has established the Wage and Bene?its Management and Control Procedure ensuring that Management Mechanism

wages are paid in full on a monthly basis and on time whilst overtime pay is calculated and disbursed in accordance with applicable

laws. When determining remuneration standards the Company refers to the government’s minimum wage standards wage Innovation Metal Innovation Precision Innovation Sheet Materials and Yunnan Innovation Alloy have implemented annual

guidelines and estimated regional living costs to ensure that employees’ wages are set above the baseline level. Furthermore based company-wide democratic appraisals to further deepen the democratic management mechanism. The appraisals were

on its business conditions the Company provides employees with subsidies for transportation communication and meals. The open to all current employees and were conducted through anonymous online scoring. Centred on the five key dimensions

Company adheres to the principle of equal pay for equal work and conducts regular assessments of remuneration disparities between of“ Virtue Competence Diligence Performance and Integrity” the appraisals encourage employees to provide objective

male and female employees to ensure that employees of different genders receive consistent remuneration for the same positions evaluations of management personnel at all levels and solicit a wide range of suggestions for management optimisation.and the same levels of performance. Furthermore on the basis of lawfully implementing the“ five social insurances and one housing The Company adhered to a“ problem-oriented” approach and used the appraisal results as a key basis for cadre evaluationfund” the Company continuously enhances its welfare system by offering diversified care benefits such as commercial insurance and management decision-making which has effectively established an open and transparent feedback loop and fostered

team-building funds and educational grants for children thereby comprehensively improving employee well-being. a sense of ownership among employees in participating in corporate governance.In 2025

? The Company paid employees’ wages in full and on time with no instances of arrears

? The Company made social insurance contributions for all employees in accordance with the law achieving a coverage

rate of 100%

Employees Actively Participated in the Annual Democratic Appraisal

Employee Communication and Interaction

Empowering Employees Co-creating Prosperity

The Company attaches great importance to communication and interaction with employees and has established a communication

mechanism that is“ multi-channel full coverage and traceable”. To facilitate the smoothness of the feedback channel the Company Enabling Talent Development

has set up a direct hotline to the chairperson and deployed digital suggestion boxes in all production workshops employee activity

centres and canteens ensuring that the voices of frontline employees reach management directly.Innovation New Material conducts annual employee satisfaction surveys. Through questionnaires and other methods the Company

collects feedback on job satisfaction sense of purpose well-being and work-related stress. The Company comprehensively considers

multiple dimensions including the working environment career development teamwork benefits and corporate culture. Based on Fair Recruitment

the survey results the Company produces an employee satisfaction survey report and a list of improvement measures corresponding-

ly. The Company also regularly organises specialised satisfaction surveys on matters such as company vehicles and canteens

continuously optimising relevant management practices in line with the actual needs of its employees. Furthermore the Company

conducts communication and research on working conditions through various channels including monthly employee representative

forums and individual employee interviews. In 2025 the employee satisfaction survey achieved a coverage rate of 100% with the Innovation New Material adheres to the principles of fairness impartiality and transparency in recruitment and has established the

overall employee satisfaction rate exceeding 90%. Recruitment Management System and the Resignation Management System to clarify employee onboarding and offboarding procedures as well as remuneration and benefits standards. The Company provides detailed disclosures on job postings including job responsi-

The Company regularly convenes the employees’ congress and organises annual democratic comprehensive evaluations and other bilities eligibility criteria and remuneration packages. The recruitment process is managed according to standardised procedures by

activities and encourages employees to take ownership and contribute suggestions for the management of the Company. At the structured interviews with uniform scoring criteria whilst interviewers undergo training to enhance the professionalism and standard-isation of the process. A dedicated reporting email address and hotline have been established at the recruitment office to proactively

accept supervision from applicants and the public at large.Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

The Company actively promotes workforce diversity and continuously expands channels for recruiting international talent. With the The Company has further refined its Company-wide Performance Appraisal Measures conducting monthly performance evaluations and

expansion of the Company’s overseas projects it has recruited foreign employees abroad for positions at multiple levels. To foster using the results of semi-annual and annual appraisals as the core basis for promotion and talent selection.multicultural integration the Company has established an onboarding support mechanism for foreign employees providing cultural

adaptation support and cross-cultural exchange activities to help them integrate into the team swiftly. ? Objectives and Key Results Assessment: It focuses on work performance with results directly linked to monthly remuneration.? 360-Degree Evaluation: Centred on the four dimensions of“ Virtue Competence Diligence and Performance” this involves

multi-perspective scoring by superiors peers and subordinates to objectively assess employees’ overall capabilities. The

evaluation results serve as a key reference for internal talent reviews and merit-based rankings.Internal recruit- * Internal job vacancies are published regularly to encourage employees to apply for positions broad- ? Team Appraisal: Conducted on a team or departmental basis this involves periodic assessments centred on overall team

ment channels: ening internal career development opportunities. performance and goal achievement rates.? Agile Dialogue: Through monthly quarterly and semi-annual one-to-one agile dialogues managers and employees are encour-

aged to engage in open discussions regarding business objectives capability development and work obstacles enabling timely

* Deepening university-industry collaboration and jointly building training bases: We actively conduct adjustments to work direction and resource allocation.campus recruitment and have established in-depth cooperative relationships with numerous univer-

sities including Jiangxi University of Science and Technology Kunming University of Science and

Technology Liaocheng University Shandong University of Science and Technology Qingdao Univer-

sity of Science and Technology and Shandong University of Aeronautics. The Company has been The Company implements differentiated appraisals for different levels:

approved as a university student internship and training base providing students with advanced ? Senior Management Personnel: Differentiated appraisals for the executive team are conducted based on strategic objectives

internship equipment facilities and professional mentors. By offering internship positions and business unit operational performance and job responsibilities.employment opportunities the Company has achieved deep integration between industry and

External ? Middle Management Cadre: A dual appraisal mechanism comprising“ goal achievement” and“ quarterly performance reviews” is education.recruitment implemented based on the breakdown of operational targets.* Strengthening skills training and consolidating the reserve of skilled craftspeople: The Company has

channels: ? Functional and Technical Personnel: A“ one-person-one-form” system is implemented with precise KPI scoring based on job partnered with vocational institutions such as Lubei Technician College and Luzhong Vocational responsibilities and actual work performance.College to conduct targeted skills training cooperation providing ample internship and employment ? Frontline Employees: Differentiated appraisals are conducted monthly based on production target achievement rates and

opportunities for students and continuously consolidating the reserve of highly skilled frontline compliance with operational procedures.personnel.* Attracting talent through multiple channels to pool high-end talent: The Company has made full use

of headhunting services and professional online recruitment platforms to precisely recruit mid-to-se- The Company attaches great importance to the fairness and impartiality of performance appraisals and has established a comprehen-

nior management personnel and core R&D technical talent thereby injecting momentum into the sive performance appeal process. Should an employee have any objections to the appraisal results they may submit an appeal in

Company’s high-quality development. writing or via the online system. The Corporate Management Department will collaborate with the employee’s department to complete

a review of the performance scores and provide feedback within seven working days thereby effectively safeguarding employees’

rights to be informed and to appeal.Employee Development

Employee Training

The Company has established four parallel career development pathways“ Management Functional Technical and Skilled” 1

covering the full career lifecycle of employee growth and ranging from frontline staff to senior management and from entry-level

workers to chief technicians. A mechanism has been implemented linking remuneration packages to career progression. As employ-

ees advance through the ranks their salaries and benefits are adjusted accordingly effectively recognising their professional growth The Company places great emphasis on the capability development and talent development of employees and has established a

and performance contributions. systematic employee training management system covering four key dimensions: pre-job training on-the-job development external

training and job-transfer training to continuously enhance employees’ job competence and the overall quality of the organisation.The Company implements a certification model that combines external professional title assessments with internal self-evaluation. The Company has systematically constructed a training matrix covering multiple dimensions including production quality safety

Non-production positions adhere to the external professional title evaluation system whilst production positions utilise a self-evalua- cost control and management enhancement with training participants encompassing its own employees contract workers and

tion mechanism for skilled personnel. Through self-evaluation the Company precisely aligns production needs with talent develop- part-time employees.ment ensuring“ the right person for the right position” and empowering both employees and the Company. In 2025 the Company

organised over 600 frontline employees to participate in the self-evaluation for skills with 559 of them successfully obtaining skills The Company implements a tiered and categorised training strategy tailored to job characteristics delivering targeted instruction

level certification thereby opening up career progression pathways for skilled personnel. through diverse methods such as mentorship schemes and internal trainer programmes to systematically conduct employee training.? For new graduates the Company places particular emphasis on strengthening mentorship and growth-enabling mechanisms.Through specialised development programmes it helps young talent integrate quickly into their positions and accelerate their

professional growth thereby laying a solid foundation for the talent pipeline to support the Company’s high-quality develop-

ment.? For production positions the Company prioritises strengthening standardised operating procedures safety awareness and

quality control capabilities.? For management positions the Company focuses on enhancing managerial mindset professional competence and organisation-

al coordination. With respect to building the capabilities of middle and senior management the Company collaborates with

external professional institutions combining “bringing in” internal training with “sending out” on-site training to continuous-

ly conduct leadership development programmes thereby driving the simultaneous advancement of management philosophy

and practical skills.Enterprise Talent Self-cultivation

1、For details of the career progression pathways please refer to the Innovation New Material ESG Report 2024. The career development pathways for the current year remain

consistent with those of 2024.Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Suzhou Chuangtai“ Green Vine Programme” Mentorship Development Initiative Innovative Training Models Empowered Talent for the Green Industry Chain

Suzhou Chuangtai successfully organised a specialised training session on“ Fundamentals of Extrusion Die Design” which

In 2025 Suzhou Chuangtai launched the“ Green Vine Programme” a graduate recruitment development initiative centred adopted a model that integrates offline interaction online live streaming and open lectures to maximise internal and

on a mentorship to facilitate the rapid growth of new employees. The Company selected 11 key business personnel to serve external knowledge sharing. The Company’s technical team served as instructors combining practical case studies to

as mentors and mentors and mentees signed a mentoring agreement to clarify development objectives and responsibili- explain fundamental principles structural characteristics material selection and core design processes. Trainees completed

ties. The nine-month programme spans nine departments including production technology and safety & environment exercises through a blend of online and offline methods gradually mastering design methodologies and problem-analysis

which is divided into three phases: onboarding orientation position specialisation and competency advancement. Through techniques.job rotation project-based training and performance assessments the programme systematically enhanced the job

competence of young talent thereby supporting the Company’s talent pipeline development.External Experts Conducted Specialised IATF 16949 Quality System Training

The Company engaged external IATF 16949 quality management system experts to deliver systematic professional training

for department heads and system administrators. The training covered knowledge of the IATF 16949 standard and the six

core tools—APQP PPAP FMEA MSA SPC and CP—and included a dedicated training module for internal system auditors.The training was delivered through frequent intensive sessions to help participants progressively comprehend the standard

requirements and practical methodologies. Following the training employees in key positions have systematically mastered

the relevant knowledge and skills laying a solid foundation for the effective operation and continuous improvement of the

quality management system.Suzhou Chuangtai “Green Vine Programme” Graduate Recruitment Development Initiative

Innovation Precision Launched Specialised Training for Production Management Capabili-

ty Enhancement

To further strengthen frontline production control level and achieve top-down management consensus Innovation

Innovation Precision Supported New Recruits’ Development Precision launched a production management capability enhancement project. Targeting 182 frontline management

personnel the project delivered a total of 22 training sessions comprising 44 teaching hours. By introducing high-quality

Innovation Precision has launched a graduate induction training resources the project successfully established a multi-dimensional closed loop for capability enhancementprogramme themed“ Encounter Acquaintance Understand- spanning from theoretical learning to practical application providing a solid management talent guarantee for the efficienting Familiarity Companionship” helping 36 outstanding and stable operation of the Company’s production activities.recent graduates from 19 universities embark on a new

journey of professional development. The programme

implemented a“ dual mentor” system assigning a business

mentor to each new employee to impart practical skills whilst Specialised Training on Management Philosophy Enhancement for Middle and Senior

a HR mentor provided regular career guidance and feedback. Management:“ Rising Leaders in Succession”

Following three months of systematic training the pro-

gramme has effectively facilitated the rapid transformation of The Company organised a specialised training programme for middle and

new employees from“ newcomers to the workplace” to“ key senior managers attended by nearly 300 managers. The curriculum focusedtalents in their positions”. on the development and replication of high-performing talent providing a

Innovation Precision Launched a Graduate Induction Camp systematic explanation of the“ learning-practicing-accessing-competing”

closed-loop development model. It facilitated managers in deepening

understanding of the principles of talent development reinforcing goal

orientation and performance-driven management thereby assisting the

Company in building a high-calibre management echelon and providing a

solid talent foundation for the enterprise’s sustainable development. “Rising Leaders in Succession” Management Training Programme

Innovation Metal "Innovation Wings" Training CampInnovation Metal held the opening ceremony for the“ Wings The Company held a strategic management reading session togetherof Innovation” training camp systematically conducting

competency development and job-specific competency

training for young employees to help them adapt to their Through the organisation of group reading sessions the Company

positions as quickly as possible. has facilitated systematical study of strategic growth logic among

middle and senior management comprehensively enhancing

management capabilities and laying a solid talent foundation for the

enterprise’s high-quality development.Innovation Metal "Innovation Wings" Training Camp The scene of the strategic management reading sessionSustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Innovation Precision“ Elite Internal Trainer” Programme Empowered Talent Development “ Good Cuisine”: Healthy Meals Thoughtful Care

Innovation Precision continued to deepen its“ Elite Internal Trainer” programme organising 29 appointed instructors to

conduct secondary seminars and in-depth development of the curriculum. Through iterative optimisation the Company has ? Tailored Services: Adhering to the “self-operated canteen” model we maintain strict food safety standards and imple-

successfully established a curriculum system that combines theoretical depth with practical value effectively promoting the ment a mechanism of “daily customised menus and weekly dish updates” and have also established special dietary

consolidation and transmission of internal expertise. windows to accommodate the dietary habits of different groups.? Thoughtful Care: We have introduced special themed meals during traditional festivals and implemented an overtime

meal subsidy policy.Employee Well-being

Upholding the core philosophy of“ Empowering Employees Co-creating Prosperity” Innovation New Material regards talent as the “ Good Recreation”: Energising and Building Team Spirit

Company’s most valuable asset. The Company thoroughly implements the“ Five Goodness Culture” focusing on the three dimen-

sions of“ good environment good cuisine and good recreation” and has formulated the Environmental and Occupational Health and ? Club Competitions: We have established various sports and interest clubs regularly organising competitive events such

Safety Operational Control Procedures and continuously optimises employees’ working environments and living facilities striving to as fun runs and ball game leagues. Over 60 employee activities are organised throughout the year to enrich employees’

comprehensively enhance employees’ sense of fulfilment and happiness. leisure time.? Team-Building Empowerment: A dedicated departmental team-building fund has been established to flexibly organise

outdoor development activities and short trips whilst skilfully integrating safety culture education into these activities to

“Good Environment”: Poetic Industrial Park Ideal for Living and Working achieve a dual enhancement of team cohesion and employee well-being.The Company is committed to breaking away from the stereotypical image of traditional factories continuously advancing

the functional optimisation and environmental beautification of the industrial park to create a“ landscape line” that

integrates efficient working spaces with convenient living facilities.? Hardware Upgrades: Standardised refurbishment of staff accommodation and enhanced industrial park greening

projects have been implemented to create a comfortable and welcoming living environment.? Cultural and Recreational Landmarks: A comprehensive cultural space within the industrial park integrating a library a

cinema and a multi-purpose sports venue featuring facilities for badminton basketball billiards and archery.The Company organised a themed cultural event titled“ Lantern Riddles During the Labour Day holiday the Company organised a“ Labour DayGuessing Games Playing Lant ern Festival Celebrating” where employees Celebration” staff sports day featuring more than ten events including

enjoyed the festive occasion and shared moments of reunion through fun games basketball badminton table tennis and skills competitions attracting nearly a

and traditional folk experiences. thousand employees to participate.The Company organised a symposium for veterans celebrating“ August 1s t ” The Company held a ceremony to present congratulatory gifts for employees’

Army Day paying tribute to their contributions to national defence upholding children who have advanced to higher levels of education sharing the joy of

Creating a Comprehensive Cultural Space the spirit of the military and inspiring new endeavours to achieve distinction their growth with employees.and success on new journeys.Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Empowering Employees Co-creating Prosperity The Company strictly complies with laws and regulations such as the Work Safety Law of the People's Republic of China the Law of the People's Republic of China on the Prevention and Control of Occupational Diseases the Fire Protection Law of the People's Republic of China the

Law of the People's Republic of China on the Safety of Special Equipment the Guideline of China Occupational Safety and Health Management

Practising Safety Production System. It actively responds to national occupational health and work safety objectives including the Five-Year Action Plan for Work-place Injury Prevention (2026–2030) and builds a comprehensive safety management system.The Company has established a range of rules and regulations governing the health and safety of all employees suppliers andAdhering to the safety philosophy of“ safety first prevention-oriented holistic management continuous improvement people-cen- contractors. These include the Production Safety Responsibility System Safety Education and Training Management System Managementtred and safe development” the Company has consistently promoted“ full participation in safety responsibility inherent safety of System of Special Operations Personnel Risk Classi?ication and Control System Hidden Danger Investigation and Management Systemequipment and facilities and standardised operational behaviour”. Centred on the objectives of“ risk control reduction of work Operation Safety Management System Occupational Health Management System Production Safety Accident Emergency Rescue Managementinjuries and zero work fatalities” the Company has comprehensively implemented a standardised safety management system. System and the Work-related Injury Incident Handling and Assessment Management System. The Company conducts annual training on

During the reporting period the Company has prioritised the prevention of major risks deepened source governance and introduced safety production regulations for all employees to ensure they are fully aware of the latest policies and regulations. Furthermore the

“technology-driven safety enhancement” measures to achieve mutual promotion and advancement between work safety and Company actively listens to feedback from frontline employees and consults with them throughout the revision process to ensure

production operations. that regulations are grounded in practical realities.The Company maintains a safety performance appraisal mechanism in accordance with the Safety Performance Appraisal Measures

strengthening supervision inspection and disciplinary action for violations and fully leveraging the guiding and motivational role of

By the end of 2025 performance appraisal. The Safety and Environment Supervision Department conducts quarterly safety performance appraisals of

subsidiaries. Performance scores are calculated item by item based on safety management aspects such as the fulfilment of safety

? Four subsidiaries have passed the second-level safety standardisation acceptance and six subsidiaries have passed the responsibilities training and education rectification of hazards emergency drills on-site safety conditions and work-related injuries.third-level safety standardisation acceptance. Safety performance rewards and penalties are implemented from frontline employees up to the General Manager of the subsidiary

? 14 factories have obtained ISO 45001 Occupational Health and Safety Management System certification accounting for based on the annual safety management outcomes of the Company workshops and work teams.

82% of the total.

In 2025

? The coverage rate of work-related injury insurance for employees reached 100% and the coverage rate of employees The Company annually analyses the potential impact of risks and opportunities on its

under work safety liability insurance for companies involving molten metal operations also reached 100%. Strategy operations and formulates corresponding response measures to mitigate risks and seize

opportunities.The Company has established a four-tier safety management framework to implement health and safety management

responsibilities at each level. The Strategy and ESG Committee of the Board of Directors serves as the highest authority for

the Company’s safety management responsible for overseeing the Company’s overall safety management. The Company

Governance has established a Safety Committee chaired by the General Manager with members comprising the General Managers of each subsidiary and the head of the Company’s Safety and Environmental Supervision Department. It provides unified leadership and formulates work safety objectives and plans. An Office is established under the Safety Committee as its

administrative body exercising unified supervision over the subsidiaries. Each subsidiary has established a Safety Potential Impact

Subcommittee chaired by the General Manager and comprising heads of workshops and departments. These subcommit-

tees fully fulfil their primary responsibility for work safety implement health and safety management measures and carry Risk Types Risk Description

out self-inspections self-corrections and self-improvements. Operational Impact Financial Impact

Tier Primary Responsibilities Reporting Frequency

Operational Risk Exposure to working environments Casualties or health Increased costs arising

Strategy and ESG ? Overall supervision of the Company’s safety / involving high-temperature molten impairment among from compensation

Committee of the management. metal gas facilities mechanical production personnel medical expenses and

Board of Directors processing equipment and special lead to production line potential litigationequipment such as overhead cranes shutdown and possible

Safety ? Establish the Company’s safety guidelines and policies and and forklift trucks may lead to burns operational disruption.Annually

Committee sets safety objectives and targets; explosions mechanical injuries

? Investigate and resolves prominent and significant work safety lifting-related injuries and vehi-

issues and monitors the outcomes of corrective actions; cle-related injuries.? Collect compile analyse and discuss typical safety incidents

within the Company and the industry to prevent safety

accidents. Management Risk Inadequate safety training and a Continuous accumula- Increased production lack of on-site supervision lead to tion of accident hazards costs and a decreased in

Safety Committee ? Conduct regular safety production supervisions and inspec- Monthly non-compliant operations and makes it impossible to operation revenue

Office tions of all subsidiaries; breaches of labour discipline. serve major clients who

? Develop and implement work safety education and training have high requirements

programmes for all employees. regarding suppliers’

safety standards.Subsidiary Safety ? Implement government and company safety policies and Quarterly

Subcommittee work requirements; Supply Chain Risk Inadequate performance Contractor accidents Increased costs

? Establish and implement a dual prevention mechanism of management of contractors may result in project

safety risk classification management and control， and whose on-site accidents or delays or joint liabilityhidden danger investigation and management and conduct non-compliant behaviour may for the Company.regular inspections of work on safety productions. directly impact the Company’s

operations.Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

investigation and management and emergency management. It has formulated the 2025 Work Plan for Advancing Safety Production

Potential Impact dynamically adjusting priorities and work plans based on completion status to ensure the effective implementation of all manage-

Opportunity Opportunity ment elements at every management level.Type Description Operational Impact Financial Impact During the reporting period the Company continued to advance the project for the standardisation and quantification of safetyproduction strengthening safety culture within work teams. It reinforced full-process management through“ pre-shift safety briefingsin-shift safety inspections and post-shift safety reviews” and refined the standardised safety production system to ensure that“operations follow established procedures inspections meet measurable standards management adheres to regulations andrewards and penalties are based on verifiable records”.Technology and Investment in robots centralised Reduce accidents and Enhance profitability by

Process dust collection and purification occupational disease improving production systems and isolation devices for rates whilst enhancing efficiency.high-temperature areas etc. to inherent safety levels Risk Identification and Classification Management and Control

reduce personnel exposure risks and production process

at source. stability.The Company has established a Safety Risk Grading Control List applicable to each subsidiary tailored to different business scenarios.This risk control list is reviewed and updated at least once a year. Risk categories and levels are determined comprehensively basedCulture and Brand Establish effective safety Enhance employee’s Reduce staff turnover and recruitment costs on potential hazards existing conditions and triggering factors. The Company uniformly adopts the principles of“ higher risk higher incentives comprehensive sense of belonging andhealth promotion programmes retention rates; create a and increase profit control level”“ key risks receive key control” and“ risks controlled at a higher level must also be controlled at lower levels” to define

and transparent communication virtuous cycle of full staff margins. the control hierarchy which serves as an important basis for hazard identification and rectification efforts.mechanisms to embed safety as participation in safety

a core value. management; win the In addition each subsidiary conducts its own annual risk identification activities. By integrating analysis of production anomalies

trust of high-end clients to lessons learned from industry accidents safety regulations and standards and the results of hidden danger investigation and

expand market presence. management each subsidiary analyses and identifies unsafe conditions of equipment and unsafe behaviours in operational activities.Adopting a bottom-up feedback model each subsidiary utilises the Likelihood Exposure Consequence method (LEC) to classify and

manage hazard sources systematically identifies safety production factors and maintains a Risk Identi?ication and Evaluation Analysis

Record. The Company’s primary safety production factors include burns mechanical injuries vehicle-related injuries crane-related

Standardised Safety Production Management System injuries and struck-by objects.Hidden Danger Investigation and Management

The safety production responsibilities of all employees

The Company has established a long-term mechanism for self-inspection and self-correction strictly implementing the requirements

of the Three-Year Action Plan for Specialised Recti?ication of Work Safety issued by higher-level government departments and conducting

hidden danger investigation work at multiple levels. The Safety and Environment Supervision Department has formulated the 2025

anagement b Hidden Danger Investigation Plan implementing weekly hidden danger investigation at team level monthly hidden danger investiga-

sed

m y the a

m Po

i sit tion at workshop level monthly specialised inspections and quarterly comprehensive inspections at Company level and conducting

monthly reviews and acceptance checks.Five levels 12 elements ? Subsidiaries shall organise at least one company-level comprehensive inspection and special inspection per quarter attended Two"One" of control of safety

by the principal responsible person or the person in charge workshop managers and technical specialists. They shall conduct at

management least one seasonal hidden danger investigation per quarter and carry out specific hidden danger investigations prior to public holidays.? Production workshops shall organise at least one workshop-level hidden danger investigation per month within their production

areas.a ig e nv E ? The Equipment Department shall organise at least one specialised inspection per month covering equipment electrical systems em ry

l

e a S and related areas.nt by subsidi ubsidiary ? Team leaders shall organise at least one team-level hidden danger investigation per week whilst dedicated safety management personnel shall conduct daily patrol safety inspections of production sites.In addition the Company has established a work safety hidden danger reporting system clarifying reward standards and ensuring

The driving Safety performance The driven The driven unimpeded reporting channels to encourage employees to actively participate in the“ Identify Hidden Dangers Around You” cam-

wheel evaluation wheel 1 wheel 2 paign with immediate rectification implemented for identified hidden dangers. During the reporting period the Company launched

the“ Hidden Danger Identification Awareness Campaign” clarifying the content of hidden danger reports reporting channels

“Dual-Wheel Drive” Safety Production Management System verification and rectification measures as well as incentive mechanisms. The Company collects hidden danger reports through various channels including telephone hidden danger reporting boxes and pre-shift meetings and maintains a comprehensive ledger

covering the entire process of“ reporting?verification?rectification?feedback”. Employees who report potential hazards are rewarded

with financial incentives. In 2025 the Company received a total of 5262 reported hidden dangers and disbursed safety rewards

The Company has established a“ Dual-Wheel Drive” Safety Production Management System. Under the unified leadership of the amounting to RMB 94600.Safety Committee of the Company and the Safety Subcommittee of subsidiaries the Safety and Environmental Supervision Depart-

ment of the Company the Safety and Environmental Department of the subsidiaries workshop safety officers team leaders and The Company has strengthened closed-loop management of hidden dangers. For identified hidden danger each subsidiary specifies

frontline employees implement classified safety management and supervision with all personnel fulfilling their safety management rectification deadlines assigns a responsible person defines corrective measures and conducts regular reviews of rectification

responsibilities within their respective positions. The Company has established 12 key elements of safety management covering the progress until closed-loop management is achieved. The Company regularly discloses the status of hidden danger investigation and

management of production equipment and facilities operational safety risk classification management and control hidden danger management and incorporate the hidden danger rectification rate into safety performance appraisal criteria.Central

aders

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nSustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

The Company engages a professional third-party organisation annually to conduct an analysis and diagnosis of its safety manage-

ment operations. From June to October 2025 the safety technology services company carried out on-site inspections of Innovation Production Equipment Management

New Material’s subsidiaries involved in molten metal operations and issued an Accident Prevention Technical Services Report. The

diagnostic analysis covered fundamental management equipment and facilities fire protection systems power distribution systems The Company continues to enhance the intelligence and safety levels of its production processes through technological upgrades and

site management and safety warning signage. All identified hidden dangers were classified as general hidden dangers. The Company equipment innovation. In 2025 Suzhou Chuangtai replaced the wire rope casting machines on two production lines with hydraulic

formulated rectification measures deadlines and responsible persons for each item and all rectifications were completed and casting machines thereby improving the inherent safety of the equipment. By the end of 2025 seven subsidiaries had established the

verified on schedule. “Deep Well Casting Safety Production Risk Monitoring and Early Warning Platform” utilising safety indicators from the PLC control

systems of the casting production lines for safety risk monitoring and early warning. The Company has designated dedicated

personnel to carry out daily monitoring of the platform promptly identifying early warning information for production and non-pro-

Accident Reporting Investigation and Handling duction processes identified by the system and ensuring timely handling of abnormal conditions.The Company implements the“ Four Nos” principle in response to abnormal situations such as work-related accidents health issues

and sudden illnesses and strictly controls the procedures and time limits for accident investigation and handling. Following an Safety Education and Training

incident the Company immediately establishes an investigation team and initiates the accident investigation procedure which

includes on-site investigations interviews with relevant personnel review of operating procedures examination of training records

and risk assessment documents. Technical analysis is conducted where necessary in order to ascertain the cause and implement The Company formulated the 2025 Employee Safety Education and Retraining Plan implementing company-wide monthly training

improvements in areas such as engineering technology personal protective equipment and management measures. The Company’s sessions for all employees team activities“ three-level” safety education for new employees training for personnel engaged in special

Safety and Environment Supervision Department regularly compiles statistics on work-related accidents involving employees and operations safety management capability training for dedicated safety management personnel and training for relevant parties.external personnel organises subsidiaries to study accident investigation and analysis reports and implements the principle that

“one injury serves as a warning to the entire plant”.Emergency Response Plans and Drills Each subsidiary conducts pre-job“ three-level” safety education for new employees namely:

company-level training on basic work safety knowledge safety management systems and

In accordance with relevant laws and regulations and taking into account the Company’s management system production scale emergency management; workshop-level training on hazard factors personal protective equip-

and the characteristics of potential accidents the Company compiles the Production Safety Accident Emergency Response Plan annually ment and on-site emergency response; and team-level training on job responsibilities safe

which is issued internally following review by internal and external experts. Based on the characteristics of accident risks the operating procedures shift handover procedures and typical case studies. This ensures that new

Company has issued the 2025 Comprehensive and Specialised Emergency Response Drill Plan requiring all subsidiaries to implement employees receive systematic and comprehensive safety management education. Pre-job training

each item. Subsidiaries involving molten metal operations must organise at least one comprehensive or specialised emergency drill Safety Education for new employees at subsidiaries involving molten metal operations shall be no less than 72 hours

every six months and conduct drills for all specialised emergency response plans every two years; subsidiaries not involving molten and Training for whilst at other subsidiaries it shall be no less than 24 hours. By 2025 the coverage rate for the

metal must organise at least one comprehensive or specialised emergency drill annually and conduct drills for all specialised New Employees “three-level” safety education programme for new employees across the Company reached 100%.emergency response plans every three years. Following the drills the organising department evaluates the effectiveness of the drill

identifies areas for future improvement and maintains records of the emergency drills. In 2025 the Company formulated a total of 52

emergency drill plans conducted 52 comprehensive and specialised emergency drills and carried out 690 on-site response plan

drills.Formulated Conducted comprehensive and Conducted on-siteemergency drill plans specialized emergency drills response plan drills The Company conducts annual training for all employees on the theme of“ Safety Production LawsRegulations Standards and Specifications”. The content includes the requirements of laws and

52 52 690 regulations such as the Work Safety Law of the People's Republic of China the Measures for the Adminis-tration of Contingency Plans for Work Safety Accidents and the Provisions on Work Safety in Metallurgical

Enterprises and Nonferrous Metal Enterprises as well as analyses of typical case studies which aims to

Training on Safety strengthen employees’ understanding of their safety production responsibilities and enhance their

Laws and Regula- awareness of compliance with rules and regulations. By 2025 the Company’s training on safety

tions laws and regulations covered 100% of employees.Innovation Precision Conducted Comprehensive Emergency Drill

In September 2025 Innovation Precision conducted a comprehen-

sive emergency drill simulating a fire and explosion caused by a

high-temperature molten aluminium leakage. Upon the occurrence

of the simulated incident the Company activated a Level II emergen-

cy response organising on-site emergency response and personnel During the reporting period the Company has strengthened training at the team level utilising the

rescue and evacuating the casting workshop as well as other five minutes before each shift to disseminate safety knowledge. The content covered safe technical

workshops and departments from the site. The drill helped operating procedures risk classification and control lists and accident case studies. By the end of

employees consolidate their evacuation procedures and enhanced Pre-shift Safety 2025 the Company had conducted over 1300 sessions of these micro-class with a participation

their self-rescue and mutual rescue capabilities in the event of an Micro-Class rate of 100% among production employees.emergency. A total of 2436 employees participated in the drill Training

achieving a participation rate of 100%. The Safety Drill SiteSustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Safety Culture Development ? The Company has formulated the “2025 Employee Safety Education and Retraining Plan” organises “Personal ProtectiveEquipment” safety training and instructs employees on the correct use and maintenance of personal protective equipment.During the nationa“l Work Safety Month” the Company organised activities under the theme“ Everyone Talks Safety EveryoneResponds to Emergencies—Identifying Safety Hazards Around Us”. Subsidiaries creatively launched distinctive safety culture In 2025 the Company achieved a 100% reporting rate for occupational hazard items a 100% detection rate for occupational hazard

initiatives including safety knowledge competitions safety skills contests safety-themed essay contests the distribution of safety factors a 100% occupational health examination rate for employees exposed to occupational hazards during their employment and

culture leaflets and the promotion of safety model stories via official WeChat public accounts collectively fostering a strong atmo- a 100% occupational health training rate for all employees.sphere of“ safety culture is built by everyone”.“Spot the Hazards” Competition Activated Safety Mindset Across the Workforce Mental Health Support Initiative

During the 2025“ Work Safety Month” the Company organised a“ Spot the Hazards” knowledge competition to identify To enhance employees’ mental well-being and alleviate workplace stress Innovation Precision launched four major

potential safety hazards. A total of seven teams representing subsidiaries reached the finals competing in multiple rounds initiatives in June 2025: Mental Health Awareness Training the“ I Love Myself” Themed Campaign Mindfulness Training

of compulsory and quick-response questions on safety knowledge including operating procedures for special equipment Empowerment and the Development of Mental Health Volunteers.control measures for confined space operations and key points for emergency evacuation. Over a hundred employees

attended the event to observe and participate. This competition effectively stimulated enthusiasm among all employees to ? The Mental Health Awareness Training for employees provided knowledge across dimensions such as sleep exercise

learn safety knowledge and enhance safety skills laying the foundation for building an intrinsically safe enterprise. psychology and diet. During the reporting period the training has covered all new employees.? The “I Love Myself” Themed Mental Health Awareness Campaign fostered a comprehensive learning atmosphere for

mental health knowledge through the development of promotional materials and the organisation of online and offline

knowledge competitions. The online knowledge competition achieved a participation rate of 96.92% with a total of

13066 responses recorded.

? The Mindfulness Training Programme attracted a total of 2806 employees to participate in daily check-ins and 1381 of

the participants received completion certificates.? The Mental Health Volunteer Training Programme selected 32 management personnel from 14 departments to

participate in online training and offline assessments with all participants having obtained certification. Volunteers

Scene from the Safety Knowledge Competition have developed psychological relief cards tailored to business scenarios and conducted regular mental health

consultations with employees. By 2025 over 10 stories about psychological improvement have been collected and

shared.Occupational Health Management

The health and safety of employees are integral to product quality production efficiency and the long-term development of the

enterprise. Innovation New Material adheres to laws and regulations such as the Law of the People's Republic of China on Work Safety the

Law of the People's Republic of China on the Prevention and Control of Occupational Diseases the Regulations on the Prevention and Treatment

of Pneumoconiosis of the People‘s Republic of China and the Provisions on the Administration of Occupational Health at Workplaces. In

accordance with the requirements of the ISO 45001 Occupational Health and Safety Management System the Company has formulat-

ed its Occupational Health and Safety Policy Statement. The Company has fully integrated occupational health and safety requirements

into its internal management systems and procurement contract terms requiring all employees and contractors to strictly adhere to

safe operating procedures.The Company safeguards the physical and mental well-being of its employees by continuously optimising the working environment

conducting regular health check-ups and training providing personal protective equipment in accordance with regulations and

organising mental health support activities.? The Company conducts annual detection of occupational hazard factors in the workplace publishes the results and establishes

corresponding emergency preparedness and response action plans at the same time.* The Company has established the Personal Protective Equipment Management System and distributes personal protective equip-

ment to employees on a regular basis in accordance with the system. The Safety and Environment Departments of each subsidi-

ary are responsible for supervising the procurement regular distribution and proper use of personal protective equipment.? The Company organises pre-employment and post-employment occupational health examinations for its employees in

accordance with regulations and establishes occupational health surveillance records.? The Company organises annual occupational health examinations for all current employees whilst on duty informs employees of Mindfulness Meditation Activity

the results in writing and establishes a “one person one file” occupational health surveillance record.Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Safety Management of Contractor Operations Indicators and Targets

The Company attaches great importance to the health and safety management of third-party external personnel and has formulated

the Management System for External Construction Teams to standardise the entire process of contractor bidding and construction. Innovation New Material is committed to continuously improving the performance of its health and safety management system.Centred on a dual mechanism of risk classification and control alongside hidden danger investigation and management the

During the bidding process the qualifications and safety management capabilities of construction units are prerequisites for Company formulates and cascades its annual work safety targets from the top to bottom ensuring that safety responsibilities are

shortlisting for Company’s projects bidding. Prior to commencement of cooperation the Company signs the Work Safety Management firmly upheld by all employees through quantifiable indicators.Agreement with all contractors and lessees stipulating the respective responsibilities for safety production management. By the end of

2025 the signing rate for safety management agreements had reached 100%.

Prior to contractors entering the site the Safety and Environment Department is responsible for collecting and verifying safety Classification 2026 Safety Management Objectives 2025 Achievement Status

management documentation including the contractor’s qualifications special operations certificates for construction personnel

insurance coverage status safety management agreements and safety construction plans and promptly provides safety training for

the contractor’s personnel. Work Safety 100% compliance rate with the work 100%

Responsibility

During construction local units and the relevant administrative departments carry out routine inspections of the contractors’ quality safety responsibility systemSystem

progress and safety measures. The Safety and Environment Department of the subsidiary continuously strengthens supervision and

inspection conducting a safety conditions confirmation inspection on the first day of project construction and organising at least one

special inspection per month targeting external construction personnel. The Company’s Safety and Environment Supervision 100% pass rate for safety education and 100%

Department conducts random spot checks on the safety of on-site construction operations at subsidiaries assessing instances of training

construction violations improper implementation of safety measures and breaches of the Company’s safety production manage-

ment system.

100% special operation personnel 100%

certification rate

Impact Risk and Opportunity Management 100% control rate for hazard sources 100%

100% completion rate for emergency 100%

The Company has incorporated employee health and safety into a systematic management framework enabling dynamic manage- drills

ment of relevant risks through process optimisation and the deployment of tools. In terms of processes the Company has embedded

the identification assessment control and response of occupational health and safety risks and opportunities into daily operations.Each year subsidiaries are organised to carry out risk identification activities establish priorities and develop action plans. By 100% integrity rate for safety devices 100%

combining analysis of production anomalies lessons learned from industry accidents and safety regulations and standards the

Company analyses identifies and improves upon issues relating to the safety of equipment and facilities unsafe human behaviour in safety signage and emergency facilities

operations unsafe conditions of objects management deficiencies as well as potential opportunities. In terms of tools the Company

utilises an information technology platform to dynamically collect and analyse data on work-related injury records occupational

health monitoring hazard reporting and training completion rates thereby providing data support for resource allocation and Work-related 1% work-related injury incidence rate 0.87%

management optimisation. Injury Manage-

At the same time the Company provides employees and contractors with necessary resources training and supervision and ment 0 occupational disease incidence rate

establishes feedback channels to receive suggestions from employees or their representatives thereby enhancing safety awareness 0

and reducing health and safety incidents.Innovation New Material | 2025 Environmental Social and Governance Report

05

Open Cooper-

ation for a

Win-Win

Future

Innovation New Material places great importance on collaborative prog-

ress with partners and is committed to working with upstream and down-

stream partners to jointly build a green resilient and responsible sustain-

able supply chain. The Company continuously strengthens privacy protec-

tion and data security management to ensure that the personal informa-

tion of partners clients and employees is strictly safeguarded thereby

laying a solid foundation for sustainable development through responsibil-

ity and trust. Whilst pursuing high-quality development we remain com-

mitted to social welfare sharing the fruits of our corporate development

with the community actively engaging in public welfare initiatives and the

construction of thriving communities and making a solid contribution to

the deep integration of commercial value and social value.Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

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Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Open Cooperation for a Win-Win Future Access Stage

Building a Responsible Supply Chain The Company has established a rigorous multi-dimensional supplier screening mechanism to control supply chain risks and quality at the source.? Multi-dimensional Sourcing: The Company sources high-quality supplier resources through open tenders industry exhibitions

peer recommendations and other channels thereby establishing a pool of high-quality potential suppliers.The Company has established a supplier ESG governance structure under the overall oversight of the Board of Directors. The Strategy ? Preliminary Qualification Screening: The Company strictly enforces a pre-qualification review system conducting comprehensive

and ESG Committee of the Board of Directors serves as the highest decision-making body is responsible for supervising the imple- checks on potential suppliers’ business licences work safety permits management system certifications and product test

mentation of strategic objectives related to the sustainable supply chain. The Sustainable Supply Chain Committee comprised of reports thereby establishing the first line of defence for compliant access.departments such as Procurement Corporate Management and Safety and Environment is responsible for policy formulation ? ESG Due Diligence: The Company has established a comprehensive ESG due diligence mechanism combining document reviews

day-to-day management and supplier capacity building. The Sustainable Supply Chain Committee regularly reports on supplier ESG with third-party screening to assess supplier compliance. The Company sets clear ESG bottom line standards and applies a

performance and risk to the Strategy and ESG Committee of the Board of Directors thereby forming a management system closed one-vote veto on suppliers that fail to meet the standards thereby strengthening risk prevention and control at the source.loop. ? On-site Audit: For suppliers who pass the initial screening the Company organises a cross-departmental team of experts

composed members from the Procurement Department and the Quality Inspection Department to conduct on-site factory

The Company has adopted the Supplier Code of Conduct and the Responsible Procurement Statement as core policy documents which set inspections. The scope of the audit covers operational capabilities such as production equipment process flows and quality

forth requirements regarding environmental management labour rights business ethics human rights protection and conflict

minerals management. These are complemented by policies such as the systems as well as the supplier’s performance in ESG areas including environmental management labour rights and employee Basic Principles of Procurement Procurement Process Control

Procedures Supplier Control Procedures and Management Procedures for Con?lict-Affected and High-Risk Areas ensuring transparent welfare.value-driven and green procurement. The Company makes a solemn commitment not to procure mineral resources from conflict-af- ? Access Commitment: All suppliers participating in the bidding process are required to sign documents including the Supplier Code

fected regions and resolutely prevents any association between its business and supply chain activities and human rights violations. of Conduct Supplier Social Responsibility Commitment Letter Environmental Notice to Relevant Parties and Declaration of Assurance of

By 2025 Innovation New Material had no overdue and unpaid accounts payable to SMEs exceeding the prescribed time limits. Prohibited Substances thereby clearly acknowledging in writing their responsibilities regarding business ethics labour rights and

environmental protection.? Positive Incentives: The Company has established a mechanism linking ESG performance to procurement decisions. During the

bidding evaluations suppliers with outstanding ESG performance are awarded bonus points and given priority in procurement.This creates positive incentives driving the continuous improvement of overall ESG management standards across the supply

chain.The Company has established a risk-based supplier screening mechanism in accordance with the Organisation for Economic

Co-operation and Development (OECD) Guidelines for Multinational Enterprises on Responsible Business Conduct and the ASI Performance

Standard. Taking into account industry characteristics and business operations we conduct differentiated risk assessments based on

specific countries industries and commodities. We focus on raw material suppliers from conflict-affected and high-risk areas

(CAHRAs) partners involved in labour-intensive processing and key raw material categories such as bauxite and recycled aluminium

systematically identifying potential risks in terms of the environment labour business ethics and human rights.Supplier Audit Elements

Environmental Impact Assessment compliance greenhouse gas emissions and energy management

Environment pollution prevention and waste management resource efficiency biodiversity and land protection

Occupational health and safety production prohibition of child labour and forced labour prohibition

Social of discrimination and harassment freedom of association and collective bargaining rights working

Supplier Full Lifecycle Management conditions conflict minerals traceability

Governance Anti-corruption and conflict of interest anti-unfair competition

The Company has established a systematic supplier lifecycle management system covering the entire process from access coopera-

tion evaluation to exit. This system aims to systematically manage suppliers’ performance in areas such as quality delivery cost

and ESG through standardised processes and strict standards thereby ensuring the stability compliance and continuous improve-

ment of the supply chain. Business Quality systems delivery capability innovation capabilitySustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Cooperation Stage Supplier Empowerment

The Company has updated its Supplier Due Diligence Form and incorporated ESG performance as a key indicator in the annual To promote collaborative development and continuous improvement of the supply chain the Company has established a systematic

performance appraisal of suppliers placing equal emphasis on dimensions such as quality delivery times and service attitude and supplier empowerment and management system in accordance with the Regulations on Supplier Capability Enhancement and Collabora-

implementing regular annual monitoring. To ensure the objectivity and comprehensiveness of the assessment results we employ a tive Development Training.diversified evaluation approach including proactive file reviews of suppliers’ compliance certificates and ESG documentation

continuous passive tracking and verification via third-party platforms on-site audits conducted at production sites and the engage- The Company conducts regular training sessions for both core suppliers and new cooperating suppliers covering core areas such as

ment of professional agencies to carry out third-party audits for key suppliers. Based on the annual assessment results the Company the requirements of the Supplier Code of Conduct product quality and delivery requirements cost and technological innovation and

classifies suppliers into three risk levels“: Red Yellow and Green” and implements differentiated management strategies accordingly. sustainable development requirements. We deliver these training sessions through various channels including online training

platforms dedicated communication meetings one-on-one coaching and email updates. The training content is divided into

compulsory and optional modules to accommodate the needs of different types of suppliers. For SMEs within the supply chain the

Company assists them in optimising production processes and enhancing overall supply chain management levels by providing

professional guidance technical support and necessary resource assistance. The Company conducts regular on-site quality safety

and compliance audits of suppliers to verify the effectiveness of training outcomes and continuously monitors any deviations in

implementation to ensure that corrective measures are fully implemented.Green Regarded as high-quality partner. The Company maintains routine annual inspections and grants

(Low Risk) priority access to strategic cooperation opportunities and order allocation.

2026 Supplier Management Objectives

Triggers an early warning mechanism. The supplier is required to formulate a dedicated improve-

Yellow ment plan spanning 6?12 months. The Company will provide necessary guidance including case ESG training coverage rate for first-level key suppliers 100%

(Medium Risk) studies of exemplary ESG suppliers assistance with improvement measures and training on the

Company’s ESG policies processes and requirements whilst monitoring the effectiveness of the

corrective actions.On-site audit coverage rate for high-risk suppliers ≥80%

Deemed an unacceptable risk. An emergency response plan will be activated a Notice of Recti?ication

Red will be issued to the supplier and a rectification deadline will be set. If the supplier fails to complete Rectification completion rate for ESG non-compliant suppliers 100%

(High Risk) rectification within the specified period or the risk continues to deteriorate the Company will

implement the supplier elimination mechanism.Supply Chain Resilience Building

The Company maintains a zero-tolerance policy towards suppliers who breach the red line. Should a supplier commit a violation

explicitly prohibited by the Company’s business ethics or Supplier Code of Conduct the Company will resolutely terminate the

cooperation relationship. Furthermore the Company strictly reviews procurement activities in accordance with the Supplier Code of Building supply chain resilience not only helps to reduce the Company’s own operational risks and improve the efficiency of resource

Conduct to ensure alignment with ESG requirements and to prevent supply chain liability risks. utilisation but also promotes value sharing across the entire industrial chain. Based on this the Company has established and

continues to refine a supply chain assurance system centred on resilience. During the reporting period the Company experienced no

supply disruptions.Performance ? Implementing a management strategy combining multi-source supply with strategic backups: We proactively develop diversified supply channels to reduce the risk of reliance on single suppliers and enhance the capability to sustain supply during

emergencies by means such as stockpiling critical materials and formulating alternative supply plans.? In 2025 the Company conducted due diligence covering ESG indicators such as environmental labour rights and

business ethics on suppliers accounting for over 80% of the annual total procurement amount and no significant ? Establishing a scientific inventory management system: We set appropriate safety stock levels for different raw materials

risks were identified. and continuously optimise inventory structure balancing supply security with the reduction of idle resources.? Between 2023 and 2025 the Company conducted human rights risk assessments for 100% of its key suppliers and ? Deepening strategic coordination mechanisms with core suppliers: Through regular information sharing and collabora-

identified no human rights issues. tion both parties jointly analyse changes in macroeconomic policies market conditions and the trade environment formulate

contingency plans in advance and enhance the overall adaptability and risk-resilience of the supply chain.Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Digital-Driven Approach

Professional Competence Enhancement Training Series for the Procurement Team

In 2025 the Company’s Procurement Department organised three comprehensive and in-depth specialised training

The Company is continuously deepening the digital transformation of its supply chain and plans to launch an integrated Supplier programmes centred on the dual themes of“ deepening expertise” and“ broadening mindset”. The training courses covered

Relationship Management (SRM) platform in 2026. Leveraging digital systems it will promote fully digitalised procurement across the areas such as practical supplier risk audit analysis of core production processes and advanced strategic management

entire process to ensure that the tendering process is standardised transparent and traceable. The platform will establish a thinking thereby enabling full-chain empowerment from operational execution to strategic management. Through this

full-chain management system covering supplier access performance evaluation risk monitoring and collaborative optimisation series of intensive training sessions the Company has effectively strengthened the procurement team’s ability to identify

thereby comprehensively enhancing the resilience efficiency and sustainability of the supply chain. risks and ensure compliance laying the foundation for building a professional efficient supply chain management team

with a vision for sustainable development.Key Functions of the SRM System

? Supplier Access and Classification Management

- Establish mechanisms for supplier registration qualification review assessment and access.- Classify and grade suppliers based on performance risk strategic value and other dimensions.? Performance and Contract Management

- Track supplier indicators including delivery quality cost and timeliness.- Manage contract terms performance and compliance.? Risk Management and Compliance Monitoring

- Integrate with third-party databases to automatically monitor supplier risks related to finance opera-

tions legal and other areas.Procurement Personnel Training

? Collaboration and Process Optimisation

- Enable online collaboration for processes such as order management inventory and logistics and

enhance management efficiency through data sharing.Open Cooperation for a Win-Win Future

? Data Analysis and Reporting

- Consolidate supplier data to generate multi-dimensional analytical reports to support optimised Fortifying Privacy Protection

decision-making and enhanced transparency.Innovation New Material has always placed client privacy protection at the core of its business operations and is committed to

building a comprehensive and efficient information security protection system. In 2025 in compliance with laws and regulations such

Internal Empowerment as the Cybersecurity Law of the People’s Republic of China and the Personal Information Protection Law of the People’s Republic of China the Company reviewed and upgraded its Network Security Management System further strengthened the client information protection

system and committed to continuously improving its information security systems and continuously monitoring and responding to

information security threats.The Company simultaneously strengthens internal capacity building. By continuously enhancing the professional competence of the Based on the full lifecycle of client information the Company has formulated the Regulations on the Con?identiality Management of Client

procurement team it provides a solid foundation for building a high-quality supply chain. To ensure that employees comprehensively Information and the Measures for the Management of Client Archives. These documents clarify the requirements for the integrity and

improve their job competencies the Company conducts training for internal employees covering multiple dimensions including security protection of client information at all stages from collection storage to destruction standardise the archiving and borrowing

supply chain quality management production processes technical inspection standards ESG risk assessment and supplier compli- processes and establish individual information security responsibilities for all employees. In addition the Company requires

ance audit capabilities. During the reporting period procurement personnel have received an average of no fewer than eight suppliers to comply with the same information security standards and incorporates information security requirements into supplier

comprehensive training sessions with content including key points of supplier ESG audits and supplier ESG capacity enhancement. access and daily management. During the reporting period the Company experienced no data security incidents no client privacy

breaches or related litigation cases and no associated losses or compensation amounts.? For new graduates the Company places particular emphasis on strengthening mentorship and growth-enabling mechanisms.Through specialised development programmes it helps young talent integrate quickly into their positions and accelerate their

professional growth thereby laying a solid foundation for the talent pipeline to support the Company’s high-quality develop-

ment.? For production positions the Company prioritises strengthening standardised operating procedures safety awareness and

quality control capabilities.? For management positions the Company focuses on enhancing managerial mindset professional competence and organisation-

al coordination. With respect to building the capabilities of middle and senior management the Company collaborates with

external professional institutions combining “bringing in” internal training with “sending out” on-site training to continuous-

ly conduct leadership development programmes thereby driving the simultaneous advancement of management philosophy

and practical skills.Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Governance Structure Safeguarding Business Resilience

? Business Continuity PlanThe Company has established a three-tier information security management and control system consisting of the“ Decision-making - Consolidation of infrastructure: Completed the standardised transformation of core computer rooms and added hyper-con-level Management level Execution level” forming a closed-loop responsibility system“ covering all areas horizontally and reaching verged nodes significantly improving computing and storage performance and business flexibility and building a more reliableall levels vertically”. By restructuring the organisational framework refining the responsibility system and strengthening the redundant architecture.emergency response mechanism the Company has gradually achieved the management transformation from“ passive defence” to - Improving safeguard schemes: Formulated the Information Centre Business Continuity Plan and conducted disaster recovery drills

“active prevention and control”. to ensure the continuity and rapid recovery capability of critical business services.? Security Monitoring and Vulnerability Analysis

- Strengthening layered defence: Deployed additional high-performance firewalls between the core production network and

industrial control network to achieve logical isolation of key business areas.- Dynamic closed-loop governance: Relying on regular vulnerability scanning and situation awareness platforms the Company

built an operational closed-loop of“ monitoring-discovery-remediation” to realise dynamic clearance of security risks.The Strategy and ESG Committee of the Board of Directors is the highest governing body for the ? Endpoint and Data Security Management Control

Company’s information security responsible for overseeing information security management work. - Strict prevention of data leakage: Launched the DLP (Data Loss Prevention) system implemented full-lifecycle encryption and

The Information Security Committee led by the Company’s senior management is responsible for permission control for core documents and combined exit control strategies for USB drives networks and other channels to

Decision-making approving the Company’s information security strategy and major policies. block unauthorised data leakage at the source.level - Standardisation of endpoint operations: Comprehensively monitored and recorded endpoint behaviours implemented unified

control strategies for software installation and external device usage strengthened security baselines and ensured that unau-

thorised and abnormal behaviours are visible and controllable.- Improving compliance efficiency: Reduced operation and maintenance burdens through automated asset inventory and

remote assistance functions and supported incident tracing and compliance audits with detailed audit logs.? Operational Mechanisms and Incident Reporting

- Establishment of a“ promoting improvement through testing” mechanism: Directly linked the results of vulnerability scanning

The Information Security Management Department coordinates strategy formulation supervision and penetration testing to the Information Centre budget to clarify the direction of technical iteration.and assessment and external cooperation and establishes a strict accountability system. - Optimising reporting processes: Set up a unified security incident reporting channel and conduct company-wide training to

Management ensure that any employee can quickly report security incidents or vulnerabilities improving the speed of problem identification

level and response.Driving Management Improvement

? Internal Audit and Verification

The Information Security Implementation Team has four dedicated sub-teams under its jurisdiction: - Conducting internal audits: Carried out a specialised internal audit of the information security management system covering

technical protection security monitoring emergency response and safety training which are the three core modules of strategy and systems technical control and operation and maintenance management.responsible for the implementation of specific tasks. - Strengthening technical verification: Focused on verifying the consistency between IP-Guard system policies and management

Execution systems validated the effectiveness of endpoint control in document encryption and peripheral device management and

level ensured closed-loop rectification of medium and high-risk issues.? ISO 27001 Certification

- Advancing system certification: Aligned with international best practices and launched preparatory work for ISO 27001 Informa-

tion Security Management System certification pushing security management to a new stage of standardisation and interna-

In 2025 the Company’s Emergency Response Command formulated graded emergency response plans covering full scenarios tionalisation.including cyber attacks and data leaks and introduced support from external professional security vendors. Through regular drills and

specialised tests the Company has significantly improved its practical security capabilities. ? Security Awareness Training

- Learning advanced experience: Participated in“ Microsoft Cybersecurity Training” to deeply absorb cutting-edge international

? The Company carried out specialised vulnerability testing throughout the year identifying a total of 17 medium and high-risk experience in AI security supply chain protection and malware defence and improved practical capabilities in responding to

vulnerabilities with a remediation rate of 94% and the average remediation cycle was shortened to 7 days. advanced threats.? In the specialised backup testing all data recovery times met the standards and the recovery efficiency of core business data - Enhancing employee capabilities: Conducted quarterly practical training for employees in key positions. The click-through rate

increased by 30% year-on-year. of phishing tests dropped to 12% the coverage rate of strong passwords rose to 90% and the average number of proactive

? The emergency decision-making efficiency for sudden security incidents improved by 40% effectively safeguarding the security of security feedback per quarter exceeded 30 items significantly improving the risk identification capabilities of all employees.the Company’s digital assets and business continuity. - Raising awareness among all staff: Continuously fostered a security culture of“ All are participants” through diversified forms such

as regular publication of the Information Security Monthly Bulletin and organisation of cybersecurity knowledge competitions.Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Open Cooperation for a Win-Win Future proactive one-on-one interviews and holds community communication meetings.The Company has established a communication and grievance mechanism combining“ regular online channels and dedicated offlineContributing to Community Development channels” in accordance with the Internal and External Grievance Management and Control Procedure and provides convenient feedback channels for stakeholders through hotlines email addresses and offline contact points. The Company has specified a 48-hour

grievance handling time limit to ensure that every complaint receives fair and efficient handling.Innovation New Material attaches great importance to the synergistic development with the communities where it operates. Adhering

to the principle of“ mutual benefit and win-win results respect for differences” the Company has built a three-tier organisationalstructure of“ Board supervision Senior management decision-making Corporate Management Department execution and coordina-tion” and created a systematic community management system. The Strategy and ESG Committee of the Board of Directors is Social Care

responsible for coordinating and supervising the Company’s work progress in the areas of community communication community

public welfare and rural revitalisation. Senior management is responsible for determining and supervising the implementation of the

annual community communication plan as well as the investment areas and amounts for public welfare and rural revitalisation. To

ensure continuous and effective interaction with stakeholders each subsidiary has established a dedicated“ Community Communica- Innovation New Material adheres to the development philosophy of“ Business for Good” continuously improves the Communitytion Officer” position responsible for coordinating and promoting community participation plans conducting daily inspections and Participation Plan and integrates social care into its daily operations and global footprint. Focusing on key areas such as elderly care

addressing community demands. student assistance poverty alleviation and disaster relief the Company has continuously carried out diversified public welfare

practices in communities where it operates both domestically and internationally earnestly addressing the needs of groups including

the elderly disadvantaged students children and disaster-affected people. The Company conveys its corporate warmth throughCommunity Management and Engagement actions. While giving back to society it continuously enhances brand reputation and strengthens community recognition fostering a sound external environment for the steady development of its business. In 2025 Chairman Cui Lixin was awarded the title of“ CaringIndividual with Outstanding Contributions to Binzhou’s Charitable Causes” and elected Vice-President of the Binzhou Charity

Federation.The Company strictly adheres to internationally recognised social responsibility standards and has formulated the Community

Management System Indigenous Peoples Identi?ication Procedure Human Rights Impact Assessment Management Procedure and Indigenous Respecting and Caring for the Elderly

Peoples Protection Policy. For new renovation and expansion projects as well as resource development and utilisation activities the

Company undertakes to strictly follow the Free Prior and Informed Consent (FPIC) principle at all stages involving the use of For more than two decades the Company has always regarded giving back to society as an important corporate mission and has long

indigenous peoples’ lands territories and traditional resources and fully safeguard their rights to independent decision-making been actively promoting the traditional virtue of respecting and caring for the elderly through systematic public welfare investments.prior consultation and informed consent. The indigenous people 1 protection measures adopted by the Company include but are not

limited to: fully recognising the unique rights of indigenous peoples to their traditional lands and resources and requiring employees

to understand their history beliefs customs and social structures; assisting indigenous communities in establishing fair and impartial

representative election mechanisms and inviting indigenous representatives to participate in the Company’s project decision-mak-

ing processes; disclosing project information through means such as posting announcements and holding information briefings and Spring Festival Visits to Nursing Homes to Continuously Fulfil Community Care Responsi-

only implementing projects after obtaining the explicit free prior and informed consent of indigenous peoples; protecting the bilities

cultural relics historic sites and traditional buildings of indigenous peoples and funding their cultural activities and artistic creations.In the run-up to the 2025 Spring Festival the Company visited and consoled nursing homes in Gaoxin Sub-district Xidong

In 2025 in accordance with the Stakeholder Identi?ication Checklist the Company conducted an in-depth human rights impact due Sub-district Jiaqiao Town and Weiqiao Town of Zouping City presented consolation funds and daily necessities such as

diligence on residents of communities surrounding its operating locations. The Company drew up community distribution maps rice flour and cooking oil to the elderly inquired with concern about their daily living and health conditions and accompa-

systematically identified surrounding community groups and other stakeholders that might be affected during project siting and nied them to celebrate the Spring Festival.operation processes and defined the scope of potential impacts and the involved parties.In response to the identified potential impacts the Company compiled the Community Investigation Report and Resettlement and

Affected Persons and Organisations Report and formulated and implemented comprehensive resettlement protection measures. During

the project planning phase the Company comprehensively conducts Environmental and Social Impact Assessments (ESIA) to identify

and mitigate the negative impacts arising from project implementation. In the event of indigenous peoples resettlement the

Company undertakes to formulate and publish the Resettlement Action Plan (RAP) and Livelihood Restoration Plan (LRP) at the

earliest possible stage ensuring that new resettlement sites are equipped with sound public service infrastructure encouraging and

supporting residents’ entrepreneurship prioritising employment opportunities for indigenous peoples within the project area

establishing an indigenous peoples grievance mechanism and regularly evaluating the implementation of resettlement actions and

livelihood restoration plans. Over the past decade no indigenous peoples resettlement has occurred in the vicinity of the Company’s

operations.In addition the Company adheres to the principles of transparency and fairness and implements the stakeholder engagement plan.The Company attaches importance to consultations with landowners local communities and government agencies to ensure that

residents have a clear understanding of project information and compensation mechanisms and promotes the transformation from

one-way communication to two-way decision-making. Throughout the entire process of environmental assessment planning and

design and operation and management the Company adheres to incorporating reasonable community demands into decision-mak-

ing references and promotes the synchronous progress of corporate development and community well-being by continuously

optimising project plans and operation models. Meanwhile the Company respects the local cultures and customs of the communities

where it operates. In the event of major operational changes the Company actively communicates with local communities through Visits to Nursing Homes

1、Indigenous peoples refer to residents who have a close connection with their territories and the surrounding

natural resources. In mainland China indigenous peoples specifically refer to “rural residents who own the land”.Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Jointly Organised Elderly Care Visits to Build a Warm Community Vietnam Precision Cared for Children in Need to Build a Warm Community

In 2025 multiple subsidiaries jointly launched themed public welfare activities of respecting the elderly on the Double Ninth In 2025 Vietnam Precision organised a volunteer team to visit the Children’s Welfare Home in Vinh City Nghe An Province

Festival enhancing the trust and emotional identity of community residents towards the enterprise. Employees of Innova- Vietnam launched a themed consolation activity of“ Fulfil Social Responsibilities Convey Innovation’s Warmth” and

tion Sheet Materials visited the nursing home in Jiaoqiao Town organised artistic performances and participated in donated children’s daily necessities to the welfare home. During the interactive session volunteers sang and communicat-

voluntary work such as cleaning the premises. Suzhou Chuangtai launched“ Green Vine Program” organising new employ- ed with the children. The person in charge of the welfare home stated that these supplies and companionship not only

ees to visit the Lingfeng sanatorium making dumplings with the elderly combing their hair and massaging their shoulders. brought practical help but also provided important spiritual encouragement to the children. The Company will gradually

Employees of Yunchuang Alloy donated disinfection cabinets and daily necessities such as rice flour and cooking oil to the establish a long-term public welfare mechanism and actively give back to the local communities whilst developing its

nursing home in Yanshan County to help improve elderly care conditions. These series of actions continuously deliver overseas business.corporate care strengthen community trust and emotional identity and contribute to the improvement of elderly care

conditions and harmonious governance.Vietnam Precision Donated Supplies to the Children’s Welfare Home

in Vinh City Nghe An Province Vietnam

Respecting and Caring Activities for the Elderly

Donations for Education

The Company has long paid attention to the growth needs of disadvantaged students and children in need and guards their educa-

tional journey through educational grants and caring actions. The Company takes educational support and child care as its long-term

public welfare focus continuously increases investment and practical efforts upholds the hopes of young people for growth through

practical actions and conveys a positive and compassionate spirit.Deepening the“ Sanyi Education Aid” Program for Seven Consecutive Years to Uphold the

Hope of Community Education

Supporting Disaster-Affected People

In 2025 the Company participated in the“ Sanyi Education Aid” public welfare program for the seventh consecutive year

and issued educational grants to 50 disadvantaged students with excellent academic performance and moral character in

Zouping City. Adhering to the tenet of“ ensuring access to education safeguarding health and guaranteeing safety” the The Company always keeps the disaster-stricken areas in mind and regards post-disaster assistance as an important practice in

“Sanyi Education Aid” program paves a smooth educational path for students through one-on-one targeted assistance. As fulfilling its social responsibilities. Through visits and consolations material donations and other means the Company responds

of the end of 2025 the Company has cumulatively supported 350 students through this program. promptly to the practical needs of disaster-affected people and helps them restore basic living order. The Company will continuously

improve its emergency response and relief mechanisms to act quickly and support disaster-stricken areas when natural disasters occur.Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Vietnam Precision Consoled Villages Affected by Typhoon Consumption Assistance Drove Revitalisation Apples Built a Bridge Connecting Hearts

In 2025 Typhoon Bualoi made landfall on the Vietnamese coast causing severe impacts on villages surrounding Vietnam In 2025 the Company continued the“ Sweet Order” consumption assistance mechanism centrally purchased 25 tonnes of

Precision. While ensuring safe production Vietnam Precision quickly activated the emergency response mechanism Huaniu apples from Lixian County an old revolutionary base area all of which were used for employee welfare. As of the end

organised volunteers to visit and console 8 disadvantaged villagers in H? Khê Village Xingyuan Commune and delivered of 2025 the Company has carried out this program for three consecutive years with a cumulative purchase of 75 tonnes of

essential daily necessities such as rice and cooking oil. The Company will continue to follow the progress of post-disaster apples. This initiative not only allows employees to taste high-quality agricultural products but also helps solve the sales

reconstruction work and provide further assistance. At present the Company has incorporated disaster relief and communi- difficulties of local fruit farmers and increases the income of rural households. The Company will continue to implement the

ty consolation into the routine of overseas operation management standing together with the communities where it “Ten Thousand Enterprises Helping Ten Thousand Villages” initiative through the“ purchase instead of donation”

operates through thick and thin with practical actions. approach providing sustainable support for rural revitalisation.Vietnam Precision Visited and Consoled H? Khê Village Xingyuan Commune after the Typhoon Disaster.Rural Revitalisation

Innovation New Material actively responds to the national rural revitalisation strategy. By establishing a long-term enterprise-village

collaborative development mechanism the Company promotes the synchronous resonance between corporate development

achievements and rural revitalisation and has established a responsible brand image. Three Consecutive Years of “Sweet Orders”

In terms of industrial collaboration the Company thoroughly implements the“ localised supply chain” strategy prioritises the

procurement of raw and auxiliary materials from surrounding rural enterprises in production and operation supports the develop- Deepening Employment Assistance to Stimulate the Endogenous Driving Force of Rural

ment of rural characteristic industries with long-term and stable commercial orders injects sustainable market momentum into the

rural economy and effectively enhances their self-sustaining capacity. Meanwhile Innovation New Material has established a Revitalisation

“welfare-driven agriculture promotion” mechanism incorporating local characteristic agricultural products into the employee welfare

procurement catalogue. While enriching employee care forms the Company effectively promotes stable income growth for local Yunchuang Alloy actively responds to the national rural revitalisation strategy deeply participates in the consolidation of

farmers achieving a win-win situation for supply chain optimisation improved employee satisfaction and increased farmers’ income. poverty alleviation achievements in Yanshan County and takes employment assistance as the core driver to regional development. The Company adheres to the principle of“ localised employment” establishes a“ priority recruitment underIn terms of talent empowerment Innovation New Material regards improving local employment as a long-term commitment and equal conditions” mechanism for registered impoverished households in its recruitment system and is committed to

actively recruits residents from surrounding communities. As of the end of 2025 the Company’s local employment rate has stabilised driving the professional transformation of rural labour force through industrial development. As of the end of the reporting

at over 80% significantly driving residents’ income growth and stimulating community economic vitality. We not only provide jobs period Yunchuang Alloy has absorbed 69 registered impoverished households to achieve stable employment effectively

but also focus on establishing a long-term talent training mechanism and implement a two-track empowerment strategy of employ- increasing the per capita annual household income of disadvantaged groups; the Company has cumulatively solved

ment and education. Through mature pre-job training and on-the-job skill improvement programs the Company helps local employ- employment for 685 local labourers with the localised employment rate reaching as high as 89.19%; and the Company has

ees quickly become competent in their work and achieve career growth assisting them in making the leap from“ simple employment” recruited 567 rural employees accounting for 73.83% of the total workforce. Through the above measures the Company

to“ skilled talent” and allowing more people in surrounding communities to benefit from corporate development achievements. has effectively promoted the local transfer of local rural labour force and injected sustainable“ self-sustaining” capacity into the balanced development of the regional economy.Innovation New Material | 2025 Environmental Social and Governance Report

Corporate

Governance

Standardising Corporate Governance

Strengthening Risk Management

Upholding Business Ethics

Innovation New Material has always regarded a sound governance system as the cornerstone of the

enterprise’s sustainable development continuously deepens corporate governance and comprehen-

sively strengthens risk management. The Company strictly abides by business ethics and compliance

operation standards embeds integrity into all aspects of the enterprise’s operations and ensures the

sound operation of the Company.

141 142Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Corporate Governance

Standardising Corporate Governance

Innovation New Material strictly complies with laws and regulations such as the Company Law of the People’s Republic of China the

Securities Law of the People’s Republic of China and the Code of Corporate Governance for Listed Companies in China and continuously

improves its corporate governance structure. The Company has formed a decision-making supervision and operation system

consisting of the Shareholders’ General Meeting the Board of Directors the Audit Committee and the Senior Management and Committee Structure

effectively safeguards the legitimate rights and interests of the Company and all shareholders. Name Position Gender Age

Audit Nomination Remuneration and Strategy and

Committee Committee Assessment Committee ESG Committee

In 2025 the Company further enhanced its governance effectiveness abolished the Board of Supervisors in accordance with the

requirements of regulations such as the Company Law and focused on strengthening the core supervisory function of the Audit

Committee. By establishing a quarterly regular supervision meeting mechanism the Audit Committee regularly reviews special Cui Lixin Chairman Male 57 ?

reports from the Internal Control and Internal Audit Department on risk management internal control and audit work achieving

full-process supervision of risk prevention and response and ensuring that the Company’s overall risk level remains under control.Wang Wei Director Male 59 ? ? ?

Xu Feng Director Male 64

Governance Structure of Innovation New Material

Zhao Xiaoguang Employee Director Male 50

Gao Shanghui Director Male 49

Audit Committee Guo Jinxiang Director Female 46

Shareholders' Meeting Xiong Hui Independent Director Female 58 ? ? ? ?

Nomination Committee Luo Bingqin Independent Director Male 61 ? ?

Board of Directors Zhang Yong Independent Director Male 44 ? ?

Remuneration and

Appraisal Committee

Senior Management Board Independence

Strategy and

ESG Committee

In accordance with national laws and regulations and the relevant provisions of the Articles of Association the Company has formulat-

ed internal systems including the Rules of Procedure for the Board of Directors the Independent Directors Working System and the working

rules for all specialised committees establishing a scientific effective and well-defined governance system with clear division of

Board Diversity powers and responsibilities. In terms of composition all members of the Audit Committee are independent directors. The chairper-sons of the Nomination Committee and the Remuneration and Assessment Committee are also independent directors so as to

ensure the independence and professionalism of each committee and strengthen supervisory effectiveness.Innovation New Material attaches great importance to the diversified composition of the Board of Directors and has formulated and The Company stipulates that independent directors shall account for no less than one-third of the Board of Directors. Independent

implemented the Board Diversity Policy. When electing or appointing directors the Company takes into comprehensive consideration directors of the Company shall meet at least three of the following criteria: 1. Having not served as senior management personnel of

factors including gender age cultural and educational background professional experience competencies expertise industrial the Company or acted as a partner or employee of the external auditor within the past one year; 2. Neither the individual nor their

insights and regional experience of members. As of the end of 2025 the Board of Directors comprises 9 members in total including 3 family members hold senior management positions in the Company or receive excessive remuneration from the Company beyond

independent directors 2 female directors and 1 employee representative director. All incumbent directors of the Company possess regulatory requirements excluding director remuneration; 3. Having no affiliated relations with major clients or suppliers of the

extensive industrial experience and solid professional knowledge in their respective fields. Company or non-profit entities receiving substantial donations from the Company; 4. Not acting as consultants or counsellors for the

Company and having no personal service contracts with the Company; 5. Being free from any other conflicts of interest as determined

by the Board of Directors.

143 144Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Board Effectiveness Innovation New Material has established a regular risk assessment and closed-loop management mechanism which is specifically undertaken by the Internal Audit Department. It updates risk appetite thresholds annually in conjunction with industry benchmarking

and strategic objectives and conducts at least two systematic assessments of financial and operational risks each year. The Company

implements hierarchical and classified risk management and control at three levels: major significant and general and continuously

The Company continuously clarifies the organisational structure responsibilities authority and working procedures of each optimises the internal control system based on assessment results. At the implementation level we adhere to the problem-oriented

specialised committee under the Board of Directors ensuring standardised and efficient performance of duties. During the reporting principle adopt a combination of internal control evaluation and special audits and accurately identify management pain points and

period the Board of Directors held 7 meetings in total and all specialised committees convened 11 meetings cumulatively. A number internal control deficiencies.of important proposals were reviewed and approved including periodic reports connected transactions amendments to the Articles

of Association external guarantees the utilisation of raised funds and the closure of fundraising investment projects. The convening

and proceeding of all meetings fully complied with applicable laws and regulations. Risk Levels Assessment Criteria Management Principles

The Company has established a comprehensive board evaluation mechanism and regularly conducts effectiveness assessments on Implement substantive measures to reduce the risk to an

the Board of Directors and its subordinate specialised committees in strict compliance with the Articles of Association. To guarantee Major Risks High probability and severe impact acceptable level

efficient board operation the Company conducts an annual self-assessment on board performance and compiles a dedicated report.Meanwhile independent directors and the Audit Committee are required to deliver annual work reports and an annual indepen- Significant Risks High probability or severe impact Proactively manage and establish an early warning

dence review of independent directors is carried out with relevant reports publicly disclosed. Targeted improvement plans are mechanism

formulated for problems identified in the assessment process to continuously optimise the overall governance system. During the

General risk Low probability and limited impact Incorporate into day-to-day operational management and year the Company steadily advanced the optimisation of the board governance framework completed the general election and monitor dynamically

renewal of the Board of Directors and reviewed the qualifications of all board members to ensure that newly appointed directors

meet regulatory and corporate governance requirements in terms of professional expertise industrial experience and performance

competence.For the identified key risks the Company conducts quantitative assessments by combining the likelihood of occurrence and the

In addition the Company fulfils its information disclosure obligations proactively and continuously strengthens institutional severity of impact and clarifies specific risk exposures.development and investor relations management. Committed to a regular multi-dimensional evaluation system the Company

strives to steadily enhance the governance efficiency and decision-making capacity of the Board and its committees providing a solid

foundation for the long-term and stable development of the enterprise.Partial Risk Identification Results of the Company

Corporate Governance Risk Name Risk Level Evaluation Process Response Measures

Strengthening Risk Management ?Likelihood: Mainly affects specific product

lines of some subsidiaries. The scrap

aluminium recycling industry is fragmented ?Expand diversified procure-

with significant price fluctuations posing ment channels;

Innovation New Material has always regarded risk prevention and control as well as audit supervision as the cornerstones of its stable Risk of uncertainties to relevant business units. ?Deepen cooperation with core

operation. The Strategy and ESG Committee of the Board of Directors oversees the identification assessment and management of Unstable The Company’s overall raw materials are suppliers;

ESG risks comprehensively consolidating the enterprise’s risk defence line and establishing a new risk management framework that Supply of dominated by molten aluminium so the General risk ?Establish a safety inventory

balances foresight and resilience. In addition the Company actively adapts to the trend of sustainable development and incorporates Recycled risk likelihood is limited. mechanism and set dynamic

ESG risks into its overall risk management system. Aluminium ?Impact Level: In the event of supply safety inventory thresholds

Raw Materials shortages it may have a certain impact on based on production capacity

In 2025 the Company comprehensively strengthened its risk management capabilities to safeguard long-term sustainable develop- the production schedule of relevant requirements and market

ment. To better guard against potential risks the Company has established three lines of defence: product lines but will not cause a major fluctuations.disruption to overall production continuity

and order delivery.First Line of Defence Second Line of Defence Third Line of Defence ?Likelihood: Supervision of the aluminium ?Establish a policy tracking

All employees Finance Department Legal Audit Department processing industry continues to tighten mechanism to timely grasp the

Department and Archives Centre and carbon emission control policies are dynamics of environmental

Risk of being introduced successively resulting in policies;

Environmen- a high likelihood of environmental policy ?Continuously promote clean

Responsible for daily internal control risk Responsible for supervising and Responsible for internal audit tal Policy Significant Risk adjustments. production transformation;

identification and assessment taking inspecting the implementation of the and risk management review Adjustments ?Impact Level: Policy tightening may lead to ?Incorporate environmental

timely control measures and reporting first line of defence and conducting and implementing rigorous increased compliance costs and the need compliance requirements into

risk prevention and control status to the compliance reviews and risk control prevention and control over for transformation of some production internal audits performance

management when necessary. for key business activities. internal risks. lines but the impact can be effectively appraisals and conduct regular

mitigated through advance planning. compliance self-inspections.

145 146Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

The Company revised the Anti-Bribery and Anti-Corruption System and continuously improved the management of anti-monopoly

The Company identifies and assesses emerging risks that may impact its operations and supply chain in the anti-unfair competition anti-corruption gift-giving political donations and charitable contributions. In terms of organisational

medium to long term and proactively takes measures to better address such risks. The two major emerging guarantee the Board of Directors is the highest authority for the supervision of the Company’s business ethics responsible for the

risks faced by the Company are the risks of international trade frictions and the risk of the implementation of overall supervision of matters related to anti-corruption anti-monopoly and fair competition. The Compliance and Ethics Commit-

carbon tariffs in multiple countries. For detailed risk descriptions and response measures please refer to the tee composed of senior management is responsible for coordinating the management of business ethics-related work including

Innovation New Material 2025 Annual Report. formulating strategic plans for anti-corruption anti-monopoly and fair competition and regularly assessing the effectiveness of the

management system. The specific tasks of anti-corruption anti-monopoly and fair competition are implemented by the Legal

Department and the Economic Supervision Department respectively. The Company regularly conducts internal audits and risk

investigations to promptly identify and correct potential compliance risks and continuously consolidates the line of defence for

business ethics. In 2025 the Company conducted on-site audits on 16 subsidiaries covering compliance internal control and

Over the past two years the Company has completed multiple internal and external risk process audits. For regional key risks and financial management. During the reporting period no major illegal or irregular acts that had a significant impact on the Company

management loopholes identified in the audits the Audit Department directly submits the assessment results and rectification occurred in the course of operation and management including corruption money laundering unfair competition bribery extortion

suggestions to the Audit Committee. Meanwhile we implement time-bound rectification and continuous tracking promote the fraud and conflicts of interest demonstrating sound business ethics management results.cultivation of regular risk management awareness among all subsidiaries and ensure the effective implementation of control

measures. From 2024 to 2025 the Company conducted 34 internal risk audits and 4 external risk audits. The Company incorporates business ethics education into its annual training plan and regularly organises training sessions on

business ethics and integrity building focusing on core areas such as anti-corruption anti-monopoly and anti-unfair competition.The Company attaches great importance to the cultivation of risk culture and the continuous upgrading of its management system. At This helps employees enhance their legal and disciplinary awareness and ethical literacy and gradually builds an all-round and

the governance level members of the Board of Directors regularly participate in training on laws and regulations organised by multi-level moral risk prevention and control network. In 2025 the Company organised a total of 12 internal training sessions covering

securities regulatory authorities to establish top-level risk awareness. At the operational level we regularly carry out risk management themes of anti-corruption anti-monopoly and fair competition with all directors and employees of the Company participating.and compliance training for all employees through a combination of online and offline methods to enhance the legal awareness and

risk prevention capabilities of all staff. In the process of business expansion the Company incorporates risk factors into the prelimi-

nary consideration of new products and new services development to ensure that innovation and risk control advance in parallel.Meanwhile risk management-related indicators are incorporated into the incentive and assessment system for senior management

and departments to promote the effective implementation of risk management responsibilities in an institutionalised manner.The overall supervision of Innovation New Material’s tax management is the responsibility of the Board of Directors. The Company Integrity Lectures Safeguarded Clean Development and Built a Solid Line of

has formulated the Tax Commitment undertaking to comply with the tax laws and regulations of the countries where it operates not Defence for Professional Ethics

to use tax structures lacking commercial substance to conduct transfer pricing in accordance with the arm’s length principle not totransfer created value to low-tax jurisdictions and not to use secrecy jurisdictions or so-called tax havens for tax avoidance. In 2025 the Company held an integrity education seminar themed“ The Sword of Discipline Hangs High Uphold Integrityand Pursue Innovation” covering over 1300 senior management personnel and employees in key positions across the

Company and all its subsidiaries. The seminar combined analysis of typical cases educational warning videos and integrity

oaths to strengthen the awareness of integrity and self-discipline among all staff. Mr. Cui Lixin Chairman of the Board

Corporate Governance emphasised the need to improve the system strengthen supervision and create a clean and upright working environment

and required employees to conduct self-reflection and keep the alarm bells ringing at all times. This event further deepened

the anti-corruption management system established a long-term mechanism to prevent and resist corruption and

Upholding Business Ethics provided a solid guarantee for the healthy development of the Company.Building a Solid Line of Defence for

Business Ethics

Innovation New Material has always regarded upholding business ethics as the core principle of its operation and management. The

Company maintains a zero-tolerance attitude towards acts such as bribery asset misappropriation conflicts of interest and seeking

improper benefits by taking advantage of official positions and resolutely safeguards a fair and honest business order. The Company

conducts its operation and management in strict compliance with laws and regulations including the Company Law of the People’s

Republic of China the Anti-Unfair Competition Law of the People’s Republic of China the Anti-Monopoly Law of the People’s Republic of China

and the Anti-Money Laundering Law of the People’s Republic of China. In conjunction with its business characteristics it has formulated

systems such as the Management and Control Procedures for Anti-Overseas Bribery and Anti-Corruption and the Management and Control

Procedures for Prohibiting Acceptance of Bribes or Obtaining Improper Bene?its by Other Means to regulate and restrict all business

activities and employee conduct. In 2025 the Company revised the Code of Business Conduct adding control requirements for emerging

risks such as the platform economy and data monopoly. On-site Photos of the Integrity Education Seminar

147 148Sustainable Circular Develop- Green and Low-Car- Technology-Led Empowering Open Cooperation

Innovation New Material | 2025 Environmental Social and Governance Report Development ment for Sustainable bon Building a Shared Jointly Driving Employees for a Win-Win Corporate

Management Coexistence Home Innovation Co-creating Prosperity Future Governance

Conducting Anti-Monopoly Training to Consolidate the Foundation of Compliant Operation

In 2025 the Company organised a special training themed“ Practices of Anti-Monopoly and Fair Competition” inviting

experts from the State Administration for Market Regulation to give on-site lectures. This training covered all middle and

senior management personnel as well as employees in key positions such as marketing and procurement with over 620

participants. Through systematic learning of the legal requirements and practical key points of anti-monopoly and fair

competition the participants further enhanced their compliance awareness and risk prevention capabilities.Launching the“ Integrity and Compliance Promotion Month” Themed Activity

The Company organised the“ Integrity and Compliance Promotion Month” activity which strengthened all employees’

awareness of integrity and self-discipline as well as their anti-bribery and anti-fraud capabilities by setting up integrity

education display boards and organising all staff to participate in online compliance knowledge quizzes. In the process of The Company maintains a zero-tolerance attitude towards corruption and unfair competition. It stipulates that neither party shall in

learning typical cases and interactive quizzes employees deepened their understanding of the Company’s compliance the course of business dealings solicit accept or accept in disguised form improper benefits such as kickbacks bribes or facilitation

requirements and behavioural bottom lines effectively promoting the construction of integrity culture. payments in any form; shall not participate in improper activities that may affect the impartial performance of duties; and shall not

engage in any other acts beyond normal working relationships that violate national policies laws and regulations. In the event of any

violation by a supplier the Company will immediately suspend the cooperative relationship and require the supplier to promptly

formulate and implement rectification measures. If the supplier still fails to meet the Company’s compliance requirements after

rectification the Company will terminate the cooperative relationship in accordance with laws and regulations.Focusing on Legal Risks to Empower Management Performance

The Company organised a special training themed“ Legal Risk Prevention for Enterprise Managers”. Starting with typical Whistleblowing and Handling Mechanism

enterprise cases the training systematically sorted out eight types of acts that damage the Company’s interests which

managers must strictly guard against in the course of performing their duties as well as the civil administrative and even

criminal liabilities they shall bear if the Company suffers losses due to breach of obligations. A total of 282 managers

participated in this training. Through learning the participants further clarified the legal boundaries and potential risks in The Company has always attached great importance to the establishment and improvement of the whistleblowing mechanism and

operation and management and effectively strengthened their awareness of law-abiding and compliant operation and the has formulated and implemented the Internal and External Complaint Management and Control Procedures and the Whistleblower

bottom line of business ethics. Protection Policy. We have established multiple round-the-clock channels for reporting violations of business ethics including

dedicated hotlines email addresses and mailing addresses which are open to employees partners clients and the general public

and support both real-name and anonymous reports. The Company strictly keeps confidential the identity information of whis-

tleblowers and undertakes to conduct investigations in accordance with the principles of openness and impartiality.Supplier Integrity Development Upon receiving a report from a stakeholder the Company will complete the preliminary assessment approval and registration of the

clue within 7 working days and determine a reasonable handling method and investigation level. For accepted clues the Company

will conduct an independent investigation within one month. If the investigation confirms the violation the Company will strictly

initiate the internal accountability procedure and feedback the handling result to the whistleblower within 7 working days after the

case is closed. If no conclusive evidence is found after preliminary investigation but further verification is still required the Company

The Company deeply integrates the concept of integrity and compliance into the entire process of supply chain management actively will transfer the case to the supervision authority of the relevant subsidiary to conduct an in-depth investigation within three months.jointly builds an integrity ecosystem with suppliers and consolidates the integrity defence line at the source of cooperation. After the investigation is completed the Company will provide an objective clarification and explanation to the relevant parties as

appropriate.? At the tendering stage the Company conducts special integrity lectures for potential suppliers to clearly communicate the

principles and requirements of integrity cooperation. All potential suppliers are required to sign the Integrity Commitment Letter The Company adopts strict whistleblower protection measures. Whistleblowing investigation materials are only accessible to

and truthfully disclose their business affiliations with other partners ensuring that supply chain information is transparent and case-handling personnel and unauthorised copying and dissemination are strictly prohibited. The Company prohibits any form of

traceable. retaliation against whistleblowers. If any internal employee is found to have committed retaliatory acts the Company will dismiss

? At the contract signing stage the Company takes the Integrity Agreement as a standard annex to all contracts and requires all them in accordance with the Employee Rewards and Punishments Management System and transfer those involved in serious circum-

cooperating suppliers to sign it clarifying the integrity obligations and breach accountability mechanism of both parties in stances to the judicial organs. If a partner commits retaliatory acts the Company will immediately terminate the cooperation and

writing. pursue liability for breach of contract so as to effectively safeguard the legitimate rights and interests of whistleblowers. In addition

? During the cooperation period the Company regularly conducts supplier integrity audits and dynamically supervises the Company incorporates the whistleblowing policy channels and case acceptance procedures into the induction training for new

suppliers’ integrity performance by requiring partners to submit compliance statements carrying out document verification and employees and the annual company-wide training system and ensures that all employees are familiar with the reporting channels

conducting proactive on-site visits. We regularly provide anti-corruption training for business partners and promptly communi- and whistleblower protection mechanism through regular publicity and implementation.cate the Company’s latest requirements to ensure that partners fully understand and comply with the Company’s compliance

standards.

149 150Innovation New Material | 2025 Environmental Social and Governance Report

Key Performance Metrics Unit 2025

ESG Key Performance Metrics

Energy Utilisation

Petrol tonne 289.12

Environmental Data Diesel tonne 859.73

Natural gas cubic metre 188876736.08

By

category

Key Performance Metrics Unit 2025 Liquefied petroleum gas tonne 2056.62

Climate Change Response Acetylene tonne 6.23

Total greenhouse gas emissions (Scope 1 + Scope 2) tonne of CO? equivalent 836203.70 Propane tonne 6.07

Direct greenhouse gas emissions (Scope 1) tonne of CO? equivalent 422061.53 Total indirect energy consumption tonne of standard coal 94048.61

Indirect greenhouse gas emissions (Scope 2) — location-based tonne of CO? equivalent 414142.17 On-site photovoltaic power generation kWh 64834871.40

Indirect greenhouse gas emissions (Scope 2) — market-based tonne of CO? equivalent 402572.40 By

category Purchased electricity kWh 675046036.44

Greenhouse gas emission intensity (Scope 1 + Scope 2) — tonne of CO? equivalent per 0.13

aluminium billets aluminium rods and cables tonne of output Purchased steam GJ 91361.16

Greenhouse gas emission intensity (Scope 1 + Scope 2) — profiles tonne of CO? equivalent per 0.71

tonne of output Proportion of renewable energy used

1%12.32

Greenhouse gas emission intensity (Scope 1 + Scope 2) — FRP tonne of CO? equivalent per 0.50 Renewable energy consumption tonne of standard coal 11201.52

tonne of output

Greenhouse gas emission intensity (Scope 1 + Scope 2) — tonne of CO? equivalent per

structural components 10000 pcs produced

7.11 Solar energy consumption tonne of standard coal 8664.57

By

category

Number of products with carbon footprint certification pcs 9 Hydropower energy consumption tonne of standard coal 2536.95

Green electricity certificates traded kWh 21656000.00 Water Utilisation

Energy Utilisation Water withdrawal tonne 3223886.69

Total energy consumption tonne of standard coal 328667.64 Industrial wastewater discharge tonne 142261.96

Energy consumption intensity tonne of standard coal 0.04 Domestic sewage discharge tonne 326587.92

per RMB 10000 revenue

Total direct energy consumption tonne of standard coal 234619.03 Water consumption tonne 2755036.81

Water utilisation intensity tonne per RMB 10000 revenue 0.36

Water recycling and reuse rate % 99.06

15111512

1 = (Purchased green electricity + Self-generated green electricity)/(Purchased electricity + Self-generated green electricity)Innovation New Material | 2025 Environmental Social and Governance Report

Environmental Data Social Data

Key Performance Metrics Unit 2025 Key Performance Metrics Unit 2025

Pollutant Emissions 1 Employees

Ammonia nitrogen (NH3-N) tonne 0.37 Total number of employees person 11125

Chemical oxygen demand (COD) tonne 10.27 Male employees person 7524

Biochemical oxygen demand (BOD) tonne 2.32 By

gender Female employees person 3601

Total nitrogen (TN) tonne 2.04 Proportion of female employees % 32.37

Total phosphorus (TP) tonne 0.24 By Full-time employees person 11125

employ-

Sulphur oxides (SOx) tonne 20.40 ment type Part-time employees person 0

Nitrogen oxides (NOx) tonne 213.98

Workers Agency workers person 101

other than

Particulate matter (PM) tonne 72.40 employees Contractors-assigned workers person 630

Volatile organic compounds (VOCs) tonne 13.90 Employees under 30 person 2654

Waste Treatment By age Employees aged 30?50 person 7616

Total volume of hazardous waste generated tonne 66685.23 Employees over 50 person 855

Total volume of non-hazardous waste generated tonne 555072.75 Employees in Chinese mainland person 10564

By region

General industrial solid waste generated tonne 552160.91 Employees in overseas regions person 561

Domestic waste generated tonne 2911.84 Proportion of female employees in management % 13.21

positions

Total volume of waste recycled and reused 2 tonne 618132.93 Proportion of female employees in junior % 14.04

management positions

Proportion of waste recycled and reused % 99.42 Employee Proportion of female employees in middle

diversity 3 management positions % 14.28

Circular Economy Proportion of female employees in management % 11.11

positions within revenue-generating departments

Total volume of recycled aluminium tonne 1196221.16 Proportion of female employees in R&D positions % 22.62

Volume of aluminium scrap recycled from in-house tonne 498471.46

production lines

Volume of recycled materials from market scrap and tonne 697749.70

industrial offcuts

153154

1 Only pollutant discharges from industrial wastewater are counted. 3 Junior management - Department head and deputy department head level

2 Includes waste recycled/reused by the Company itself and waste sent to third parties for recycling/reuse. Middle management - Deputy general manager level

Senior management - General manager levelInnovation New Material | 2025 Environmental Social and Governance Report

Social Data Key Performance Metrics Unit 2025

Employees

Key Performance Metrics Unit 2025 Proportion of internal hires % 51.00

Employees Employee turnover rate % 32.69

Number of ethnic minority employees person 814 Turnover rate for ethnic minority employees % 34.56

Proportion of ethnic minority employees in management % 1.42 Turnover rate of female employees % 25.34

Employee positions By

diversity gender

Number of local employees person 9887 Turnover rate of male employees % 35.73

Proportion of local employees in management positions % 15.38 Turnover rate for employees under 30 % 44.57

Number of demobilised military personnel recruited person 172 By age Turnover rate for employees aged 30?50 % 28.84

Employee Number of employees with disabilities person 27 Turnover rate for employees aged over 50 % 17.71support

Number of employees in difficulty receiving assistance person 88 Turnover rate among junior management level % 12.24

By

Number of R&D employees person 504 manage- Turnover rate among middle management level % 24.32

ment level

Proportion of R&D employees % 4.53 Turnover rate among senior management level % 0

Total number of new recruits person 5071 Voluntary employee turnover rate % 32.69

Total number of new recruits from ethnic minorities person 418 Total employee training hours hour 575412.00

Total number of new female employees person 1203 Total training hours for employees under 30 hour 137271.00

By

gender

Total number of new male employees person 3868 By age Total training hours for employees aged 30?50 hour 393919.00

Total number of new employees aged under 30 person 2322 Total training hours for employees aged over 50 hour 44222.00

By age Total number of new employees aged 30?50 person 2662 Total training hours for junior management level hour 9672.00

By

Total number of new employees aged over 50 person 87 manage- Total training hours for middle management level hour 982.00

ment level

Total number of new employees at junior management level person 12 Total training hours for senior management level hour 672.00

By

manage- Total number of new employees at middle management level person 4 Number of employee training sessions session 6381

ment level

Total number of new employees at senior management level person 0 Employee training coverage rate % 100.00

155 156Innovation New Material | 2025 Environmental Social and Governance Report

Social Data Key Performance Metrics Unit 2025

Occupational Health and Safety

Key Performance Metrics Unit 2025 Employees % 3.80Total Recordable

Injury Frequency Rate

Employees (TRIFR) Contractors % 0

Total employee training expenditure RMB 540700 Number of occupational disease cases person 0

Proportion of employees covered by trade unions/collective agreements % 100.00 Incidence rate of occupational diseases % 0

Employee satisfaction rate % 90.00 Average safety training hours per employee hour 28

Proportion of employees covered by employee satisfaction survey % 100.00 Work-related injury insurance expenditure RMB 5750900

Number of discrimination or harassment lawsuits filed against the Company or case 0 Work safety liability insurance expenditure RMB 728800

its employees that have been concluded

Occupational Health and Safety Employee coverage rate of work safety liability insurance % 100.00

Number of workdays lost due to occupational injury/illness day 16576 Employee coverage rate of work-related injury insurance % 100.00

Employees % 98.36 Supply Chain Security

Loss of Workday

Rate (LWR)

Contractors % 0 Total number of suppliers supplier 2642

Employees incident 97 Suppliers in Chinese mainland supplier 2543

Number of By region

work-related

accidents Contractors incident 0 Suppliers in overseas regions supplier 99

Number of employee work-related accidents (serious and above) incident 0 Tier 1 suppliers supplier 2642

Employees 1 person 1 Tier 1 critical suppliers supplier 126

Number of

work-related

By type Proportion of total procurement spend on Tier 1 fatalities Contractors person 0 % 76.22critical suppliers

Work-related fatality rate % 0.009 Non-Tier 1 critical suppliers supplier 0

Number of work-related injuries person 97 Critical suppliers (including Tier 1 and non-Tier 1) supplier 126

Work-related injury rate % 0.87

Employees % 2.88

Lost Time Injury

Frequency Rate

(LTIFR) Contractors % 0

157158

1 One commuting traffic fatality occurred in 2025.Innovation New Material | 2025 Environmental Social and Governance Report

Social Data Key Performance Metrics Unit 2025

Rural Revitalisation

Key Performance Metrics Unit 2025 Number of people benefiting from rural revitalisation person 43

Supply Chain Security Social Contribution

Total number of suppliers assessed online or on-site supplier 2642 Total investment in social contribution RMB 100000

Proportion of critical suppliers assessed % 100.00 Total number of employees involved in social contribution person 203

Number of suppliers assessed as having significant actual or Total hours spent on social contribution activities hour 763.00

potential negative impacts supplier 59

Proportion of suppliers with significant actual or Number of participants in volunteer service activities participant 279

potential negative impacts that have implemented % 100.00

corrective measures or improvement plans

Number of individuals provided with social assistance person 241

Number of suppliers with significant actual or potential supplier 0

Number of suppliers negative impacts that have been terminated Anti-Commercial Bribery and Anti-Corruption

participating in

Number of suppliers supported during the Number of concluded corruption litigation cases brought against the

assessments and supplier 59implementation of corrective action plans case 0Company or its employees

training

Proportion of suppliers with significant actual Number of concluded conflicts of interest litigation cases brought case 0

or potential negative impacts that are support- % 100.00 against the Company or its employees

ed in corrective action plans Number of concluded money laundering or insider trading litigation cases brought case 0

Total number of suppliers participating in capaci- against the Company or its employees40

ty-building projects supplier Proportion of directors who have received anti-commercial % 100.00

bribery and anti-corruption training

Proportion of critical suppliers participating in % 100.00

capacity-building projects Proportion of management who have received anti-bribery and % 100.00

anti-corruption training

Proportion of total transaction value from suppliers

whose primary operating location is Shandong % 70.68 Proportion of employees who have received anti-bribery and % 100.00

Province anti-corruption training

Innovation-Driven

Total R&D investment RMB 313744700

R&D investment as a proportion of principal business revenue % 0.41

Number of invention patents applied to principal business Number 74

Number of invention patent applications Number 53

Number of invention patents granted Number 14

Number of valid patents Number 534

159 160Innovation New Material | 2025 Environmental Social and Governance Report

GRI Index GRI Standards Disclosure Items Report Disclosure SectionsGRI 2: General Disclosures

Role of the highest governance body in

2-14 sustainability reporting Sustainable Development Management

Innovation New Material has prepared this report in accordance

Instructions for Use 2-15 Conflicts of interest Sustainable Development Managementwith the GRI Standards for the 2025 reporting period

2-16 Communication of critical concerns Sustainable Development Management

GRI 1 used GRI 1: Foundation 2021

2-17 Collective knowledge of the highest governance body Standardising Corporate Governance

2-18 Evaluation of the performance of the highest governance body Standardising Corporate Governance

2-19 Remuneration policies Promoting Diversity and Inclusion

GRI Standards Disclosure Items Report Disclosure Sections 2-20 Process to determine remuneration Promoting Diversity and Inclusion

GRI 2: General Disclosures 2-21 Annual total compensation ratio /

2-1 Organisational details About Innovation New Material 2-22 Statement on sustainable development strategy Chairman’s Message

2-2 Entities included in the organisation’s sustainability report About This Report 2-23 Policy commitments

Upholding Business Ethics

Promoting Diversity and Inclusion

2-3 Reporting period frequency and contact point About This Report 2-24 Embedding policy commitments Upholding Business Ethics

2-4 Restatements of information / 2-25 Processes to remediate negative impacts Promoting Diversity and Inclusion

2-5 External assurance / 2-26 Mechanisms for seeking advice and raising concerns Promoting Diversity and Inclusion

Activities value chain and other business About Innovation New Material

2-6 relationships Building a Responsible Supply Chain 2-27 Compliance with laws and regulations Disclosures by Chapter

2-7 Employees ESG Key Performance Metrics 2-28 Membership associations Adhering to Innovation-Driven

Development

2-8 Workers who are not employees ESG Key Performance Metrics 2-29 Approach to stakeholder engagement Stakeholder Engagement

2-9 Governance structure and composition

Sustainable Development Management

Standardising Corporate Governance 2-30 Collective bargaining agreements Promoting Diversity and Inclusion

Nomination and selection of the highest

2-10 governance body Standardising Corporate Governance GRI 3: Material Topics

2-11 Chair of the highest governance body Standardising Corporate Governance 3-1 Process to determine material topics Double Materiality Assessment

Role of the highest governance body in overseeing

2-12 the management of impacts Standardising Corporate Governance 3-2 List of material topics Double Materiality Assessment

2-13 Delegation of responsibility for managing impacts Standardising Corporate Governance 3-3 Management of material topics Double Materiality Assessment

1611 1612Innovation New Material | 2025 Environmental Social and Governance Report

GRI Standards Disclosure Items Report Disclosure Sections GRI Standards Disclosure Items Report Disclosure Sections

GRI 201: Economic Performance GRI 207: Tax

201-1 Direct economic value generated and distributed / 207-3 Stakeholder engagement and management /

of concerns related to tax

201-2 Financial implications and other risks and opportunities due to climate change Climate Change Response 207-4 Country-by-country reporting /

201-3 Defined benefit plan obligations and other Promoting Diversity and Inclusion

retirement plans GRI 301: Materials

201-4 Financial assistance received from government / 301-1 Materials used by weight or volume Building a Green Industrial Chain

GRI 202: Market Presence 301-2 Recycled input materials used Building a Green Industrial ChainDeveloping a Circular Economy

202-1 Ratios of standard entry level wage by gender / 301-3 Reclaimed products and their Building a Green Industrial Chaincompared to local minimum wage packaging materials Developing a Circular Economy

202-2 Proportion of senior management hired from ESG Key Performance Metrics

the local community GRI 302: Energy

GRI 203: Indirect Economic Impacts 302-1 Energy consumption within the organisation ESG Key Performance Metrics

203-1 Infrastructure investments and services supported Contribution to Community 302-2 Energy consumption outside of the organisation /

Development

203-2 Significant indirect economic impacts Contribution to Community 302-3 Energy intensity ESG Key Performance Metrics

Development

GRI 204: Procurement Practices 302-4 Reduction of energy consumption Building a Green Industrial Chain

204-1 Proportion of spending on local suppliers ESG Key Performance Metrics 302-5 Reductions in energy requirements of products Building a Green Industrial Chain

and services

GRI 205: Anti-corruption GRI 303: Water and Effluents

205-1 Operations assessed for risks related to corruption Upholding Business Ethics 303-1 Interactions with water as a shared resource Optimising Water Resource Utilisation

205-2 Communication and training about anti-corruption Upholding Business Ethics 303-2 Management of water discharge-related impacts Pollutant Discharge Reduction

policies and procedures Optimising Water Resource Utilisation

205-3 Confirmed incidents of corruption and actions taken Upholding Business Ethics 303-3 Water withdrawal ESG Key Performance Metrics

GRI 206: Anti-competitive Behaviour 303-4 Water discharge ESG Key Performance Metrics

206-1 Legal actions for anti-competitive behaviour Upholding Business Ethics 303-5 Water consumption ESG Key Performance Metrics

anti-trust and monopoly practices

GRI 207: Tax

207-1 Approach to tax /

207-2 Tax governance control and risk management /

163 164Innovation New Material | 2025 Environmental Social and Governance Report

GRI Standards Disclosure Items Report Disclosure Sections GRI Standards Disclosure Items Report Disclosure Sections

GRI 304: Biodiversity GRI 308: Supplier Environmental Assessment

308-1 New suppliers that were screened using Sites owned leased or managed within or Building a Responsible Supply Chainenvironmental criteria

304-1 adjacent to protected areas and areas Biodiversity Protection

outside protected areas with high 308-2 Negative environmental impacts in the Building a Responsible Supply Chain

biodiversity value supply chain and actions taken

304-2 Significant impacts of activities products

GRI 401: Employment

Biodiversity Protection

and services on biodiversity

401-1 New employee hires and employee turnover ESG Key Performance Metrics

304-3 Protected or restored habitats Biodiversity Protection

401-2 Benefits provided to full-time employees that are not provided to temporary or part-time employees Promoting Diversity and InclusionHabitats affected by operations that have

304-4 been listed by the International Union for Biodiversity Protection

Conservation of Nature 401-3 Parental leave Promoting Diversity and Inclusion

GRI 305: Emissions GRI 402: Labour / Management Relations

305-1 Direct (Scope 1) GHG emissions ESG Key Performance Metrics 402-1 Minimum notice periods regarding Promoting Diversity and Inclusion

operational changes

305-2 Energy indirect (Scope 2) GHG emissions ESG Key Performance Metrics GRI 403: Occupational Health and Safety

305-3 Other indirect (Scope 3) GHG emissions ESG Key Performance Metrics 403-1 Occupational health and safety Practising Safety Production

management system

305-4 GHG emissions intensity ESG Key Performance Metrics 403-2 Hazard identification risk assessment Practising Safety Production

and incident investigation

305-5 Reduction of GHG emissions Climate Change ResponseBuilding a Green Industrial Chain 403-3 Occupational health services Practising Safety Production

305-6 Emissions of ozone-depleting substances (ODS) / 403-4 Worker participation consultation and commu- Practising Safety Production

nication on occupational health and safety

305-7 Nitrogen oxides (NOx) sulphur oxides (SOx) and other significant air emissions ESG Key Performance Metrics 403-5 Worker training on occupational health and safety Practising Safety Production

GRI 306: Waste 403-6 Promotion of worker health Practising Safety Production

306-1 Waste generation and significant Standardising Waste Management

waste-related impacts Prevention and mitigation of occupational health 403-7 and safety impacts directly linked by business Practising Safety Production

306-2 Management of significant Standardising Waste Management relationships

waste-related impacts

403-8 Workers covered by an occupational health and Practising Safety Production

306-3 Waste generated ESG Key Performance Metrics safety management system

403-9 Work-related injuries Practising Safety Production

306-4 Waste diverted from disposal ESG Key Performance Metrics

403-10 Work-related ill health Practising Safety Production

306-5 Waste directed to disposal ESG Key Performance Metrics

165 166Innovation New Material | 2025 Environmental Social and Governance Report

GRI Standards Disclosure Items Report Disclosure Sections GRI Standards Disclosure Items Report Disclosure Sections

GRI 404: Training and Education GRI 413: Local Communities

404-1 Average hours of training per year per employee ESG Key Performance Metrics 413-1 Operations with local community engagement Contributing to Community

impact assessments and development programs Development

404-2 Programs for upgrading employee skills and Enabling Talent Development Operations with significant actual and

transition assistance programs 413-2 Contributing to Community potential negative impacts on local Development

404-3 Percentage of employees receiving regular

communities

Enabling Talent Development

performance and career development reviews

GRI 414: Supplier Social Assessment

GRI 405: Diversity and Equal Opportunities

414-1 New suppliers that were screened using Building a Responsible Supply Chain

405-1 Diversity of governance bodies and employees ESG Key Performance Metrics social criteria

Ratio of basic salary and remuneration of 414-2

Negative social impacts in the supply chain Building a Responsible Supply Chain

405-2 / and actions taken

women to men

GRI 415: Public Policy

GRI 406: Non-discrimination

Incidents of discrimination and corrective 415-1 Political contributions /406-1 Promoting Diversity and Inclusion

actions taken

GRI 416: Client Health and Safety

GRI 407: Freedom of Association and Collective Bargaining

416-1 Assessment of the health and safety impacts of Strict Product Quality Control

Operations and suppliers in which the right to product and service categories

407-1 freedom of association and collective Promoting Diversity and Inclusion

416-2 Incidents of non-compliance concerning the health bargaining may be at risk Strict Product Quality Controland safety impacts of products and services

GRI 408: Child Labour GRI 417: Marketing and Labelling

408-1 Operations and suppliers at significant risk for / 417-1 Requirements for product and service incidents of child labour Strict Product Quality Controlinformation and labeling

GRI 409: Forced or Compulsory Labour 417-2 Incidents of non-compliance concerning Strict Product Quality Controlproduct and service information and labeling

Operations and suppliers at significant 417-3 Incidents of non-compliance concerning

409-1 Promoting Diversity and Inclusion

Strict Product Quality Control

risk for incidents of forced or compulsory marketing communicationsBuilding a Responsible Supply Chain

labour

GRI 418: Client Privacy

GRI 410: Security Practices

Substantiated complaints concerning

Security personnel trained in human rights 418-1 breaches of client privacy and losses of Fortifying Privacy Protection410-1 /

policies or procedures client data

GRI 411: Rights of Indigenous Peoples

411-1 Incidents of violations involving rights of Contributing to Community indigenous peoples Development

167 168Innovation New Material | 2025 Environmental Social and Governance Report

Index of Shanghai Stock Exchange Dimension No. Topic Report Disclosure Section

(SSE) Disclosure Requirements 13 Supply Chain Security Building a Responsible Supply Chain

The Company has no outstanding

14 Equal Treatment of SMEs accounts payable to SMEs that are

Index of the Guidelines No. 14 of Shanghai Stock Exchange for Self-Regulation of Listed overdue.Companies—Sustainability Report (Trial)

Strict Product Quality Control

Social 15 Product and Service Safety and Quality Service Experience Guarantee

16 Data Security and Client Privacy Protection Fortifying Privacy Protection

Promoting Diversity and Inclusion

17 Employees Enabling Talent Development

Dimension No. Topic Report Disclosure Section Practising Safety Production

1 Responding to Climate Change Climate Change Response 18 Due Diligence Building a Responsible Supply ChainUpholding Business Ethics

Sustain-

2 Pollutant Emissions Pollutant Discharge Reduction ability-re- 19 Stakeholder Engagement Stakeholder Engagement

lated

3 Waste Disposal Standardising Waste Management gover- 20 Anti-Commercial Bribery and Upholding Business EthicsAnti-Corruption

nance

4 Ecosystem and Biodiversity Protection Biodiversity Protection 21 Anti-Unfair Competition Upholding Business Ethics

Environ-

mental 5 Environmental Compliance Management Environmental Compliance Management

6 Energy Utilisation Building a Green Industrial Chain

7 Water Utilisation Optimising Water Resource Utilisation

8 Circular Economy Developing a Circular Economy

9 Rural Revitalisation Contributing to Community Development

10 Social Contribution Contributing to Community Development

11 Innovation-Driven Adhering to Innovation-Led Development

Social

The Company does not engage in scientific

research technological development or

12 Ethics of Science and Technology other activities in areas sensitive from an

ethical perspective such as life sciences

and artificial intelligence.

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