Environmental Social and Governance

(ESG) Report

Shanghai M&G Stationery Inc.CONTENTS

About This Report 01

01 Focus: Sustainable Product 02 Product Climate and President's Message 03 Innovation and Practice Stewardship 03 Environment

About M&G 05 Sustainable Product Portfolio 13 Sustainable Products 18 Response to Climate Change 30

Sustainable Product Series 14 Product Quality and Safety 22 Environmental Compliance and 40

Sustainable Development 06 Pollution Prevention

Management Sustainable Design 15 Marketing and After-sales 27

Waste Management 41

Green Consumption Advocacy 16

Water Resources Management 42

Biodiversity 43

04 Shared Prosperity Across the Value Chain 05 Employees and 06 Governance and Communities Integrity

Technological Innovation 46 Occupational Health and 60 Corporate Governance 76

Safety

Supply Chain Management 50 Investor Communication 77

Employee Rights and 63

Information Security and 57 Development Risk Management 78

Privacy Protection

Diversity Equity and 70 Business Ethics 79

Inclusion

Social Welfare 72

ESG Performance Data 82

Independent Assurance 88

Statement

Index of Indicators 89Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 01

About This Report

This report is the fifth Environmental Social and Governance Report (hereinafter referred to as "this Report") released by Shanghai M&G Stationery Inc.(hereinafter referred to as "M&G Stationery" "M&G" "we" or "the Company") focusing on the disclosure of M&G's concepts progress and highlights in

environmental protection social responsibility and corporate governance during 2025.Basis for Preparation Statement

This Report has been prepared in accordance with the Guidelines No. 14 of Shanghai Stock Exchange for The data contained in this Report is sourced from the Company's official documents related reports and

Self-Regulation of Listed Companies—Sustainability Report (Trial) ("SSE Sustainability Report Guidelines") statistical records. Unless otherwise specified all monetary amounts in this Report are denominated in

and the Guide No.4 for Self-Regulatory Supervision on Listed Companies of the SSE — Compilation of Renminbi (RMB).Sustainable Development Reports ("SSE Sustainability Report Guide") issued by the Shanghai Stock

This Report has been reviewed and approved at the 15th meeting of the 6th Board of Directors the 1st

Exchange website while also referencing the Corporate Sustainability Disclosure Standards – Basic

Standards (Trial) meeting of the Strategy Committee in 2026 of M&G held on March 30 2026. ("Ministry of Finance Basic Disclosure Standards") and the Corporate Sustainability

Disclosure Standards No. 1 – Climate (Trial) ("Ministry of Finance Climate Disclosure Standards") issued by

nine Chinese government authorities including the Ministry of Finance of the People's Republic of China

the GRI Sustainability Reporting Standards ("GRI Standards") issued by the Global Sustainability Standards Report Assurance

Board ("GSSB") the IFRS Sustainability Disclosure Standards ("IFRS S1" and "IFRS S2") issued by the To enhance the authenticity and reliability of this Report it has undergone third-party assurance by CECEP

International Sustainability Standards Board ("ISSB") the Recommendations of the Task Force on Climate- (HK) Advisory Company Limited. An independent assurance statement has been provided with detailed

related Financial Disclosures ("TCFD") and the United Nations Sustainable Development Goals (SDGs). content available in the "Independent Assurance Statement" chapter.Scope of Report Access to Report

Reporting scope: This Report is available in both Simplified Chinese and English versions. In the event of any discrepancy

The reporting period aligns with M&G's 2025 Annual Report covering January 1 2025 to December 31 between the two versions the Simplified Chinese version shall prevail.

2025 (hereinafter referred to as "this year" or "the reporting period"). Selected content and data may This Report is published in both printed and electronic formats. The electronic version can be viewed and

extend to or reference other years where appropriate. downloaded on the SSE website (www.sse.com.cn) the CNInfo Information Disclosure Platform (www.Organizational scope: cninfo.com.cn) and M&G Stationery's official corporate website (www.mg-pen.com).Unless specifically stated the information and data disclosed in this Report align with the scope of M&G's

2025 Annual Report encompassing M&G Stationery and its subsidiaries such as Colipu Technologies

Group Co. Ltd. (hereinafter referred to as "Colipu Group") Jiumu M&G Store Enterprise Management Feedback and Suggestions

Co. Ltd.(hereinafter referred to as "Jiumu Store") Axus Stationery (Shanghai) Company Ltd. (hereinafter For any inquiries or feedback regarding this Report please contact us through the following channels:

referred to as "Axus Stationery") and other subsidiaries.Address: No. 5 Lane 288 Qianfan Road Xinqiao Town Songjiang District Shanghai

Email: ESG@mg-pen.comForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 02

Chen Huxiong

President's Message President of Shanghai M&G Stationery Inc.With another year behind us we have delivered meaningful progress and tangible accomplishments. 2025 marks we have continued to reduce carbon emissions in the warehousing and logistics stage and further strengthened

a period of steady progress and sustained positive momentum with M&G navigating challenges confidently and the green resilience of our operations.advancing forward. Faced with a complex landscape marked by the shift from old to new drivers in the global

Strengthening Win-Win Value Creation and Building a Responsible Supply System

economy intensifying market competition and mounting pressure on the consumer market M&G chose to be

a long-termist and remained committed to doing what is difficult but right. Centered on the vision of "Writing Supply chain resilience and shared prosperity across the value chain are the cornerstones of M&G's steady and

a Sustainable Business Future" we made steady progress and delivered sustained efforts across the four sustained progress. We are committed to building a green compliant and win-win sustainable supply chain

strategic pillars: Sustainable Products Response to Climate Change Sustainable Supply Chain and Empowering system integrating ESG assessment dimensions into new supplier screening and onboarding mechanisms

Employees and Communities achieving a series of phased breakthroughs with demonstrative significance for the to ensure control at the source. During the reporting period we completed comprehensive and in-depth

industry. During the reporting period M&G's MSCI ESG rating jumped to AA and we were successfully selected for ESG assessments of 97 key suppliers. Through collaborative efforts we promoted targeted management

the S&P Global Sustainability Yearbook 2026 joining the leading ranks of ESG governance among global peers. improvements achieving a rectification compliance rate of 100%. Upholding the vision of "Partnership for a

This marks that through outstanding ESG practices we are demonstrating to the world the responsibility and Shared Future" we continue to strengthen our support for channel partners. In 2025 we carried out a wide

excellence of "China's stationery." range of channel empowerment initiatives including platform development brand upgrading and digital

transformation providing all-around support to help channel partners build resilient risk resistance to navigate

Upholding Green Innovation and Writing a New Paradigm for Sustainable Products

business cycles and jointly create enduring value.Products are the bridge through which M&G connects consumers with a better green life. In 2025 we deepened

the implementation of the Sustainable Product Evaluation Standards Upholding the Altruistic Philosophy and Jointly Building Employee and Community Well-being embedding sustainable concepts

throughout the full product life cycle and accelerating the development of a diversified sustainable product The altruistic philosophy of "Prioritizing the well-being of others before our own" is the foundation of M&G's

portfolio. On the consumer side through materials innovation and creative design we launched new products corporate culture. In 2025 we upheld a people-oriented approach and were committed to building a broad

in the "LOHAS" and "Rare Animals" translating biodiversity conservation concepts into accessible everyday platform for every striver to fully develop their talents. We continued to optimize talent pipeline development.experiences; on the corporate side we developed the "Eco+Office" low-carbon office solution to empower Through training programs such as the "Child of Light" management trainee development program and the

customers' green transformation. Moreover we leveraged creative pop-up events and in-store sustainability M&G Lecture Class we enabled new forces to grow rapidly and helped leading talents stand out. At the same

zones to deepen value resonance with the younger generation and showcased our innovative achievements at time we elevated diversity equity and inclusion (DEI) to a strategic level appointing for the first time a Chief

international platforms such as the Boao Forum for Asia and COP30 contributing to the world a China solution Diversity Officer (CDO) of M&G Stationery. We released the DEI Strategy House to all employees and by advancing

that leads the transformation toward green consumption. initiatives such as the Women's Leadership Workshop and the Employee Engagement Survey built an open and

inclusive workplace environment. In the area of social responsibility the Shanghai M&G Foundation remained

Deepening Climate Action and Driving Low-Carbon Transition across the Entire Value Chain

deeply rooted in rural art education. During the year its flagship program the "Art Education Plan" program

In response to the long-term challenges of climate and environmental changes M&G implements the carbon reached 960 schools and 110 communities benefiting a total of 860000 individuals. We also joined hands with

neutrality roadmap with strong execution. In 2025 notwithstanding the completion and commencement of the professional psychology team of East China Normal University to publish the first Report of an Art Education

operations at our new base we maintained carbon emissions within our targets achieving a 36% reduction Based Mental Health using professional expertise to fill an industry gap. From eight consecutive years of the

in total Scope 1 and Scope 2 carbon emissions compared with 2021. By increasing the construction of in- "E.G.G Walkathon" charity walk to charity art exhibitions in the heart of the city we mobilized employees and the

house photovoltaic systems at the production and logistics base and expanding green electricity procurement public to take action in person converging into a powerful tide for good and enabling the M&G Charity brand to

the proportion of renewable energy in total electricity consumption increased to 21%. Our carbon reduction shine brilliantly across society.initiatives were further extended to upstream and downstream segments of the value chain. In accordance

The way of benefiting all beings advances with the times. On our future journey we will always remain true to our

with ISO 14067 we established a product carbon footprint accounting system and completed full life cycle

original aspiration walking side by side with consumers employees customers suppliers and all stakeholders

carbon footprint accounting for 11 products six of which have obtained third-party certification. In addition by

to jointly write a new chapter for Chinese brands on the path of sustainable development and steadily move

leveraging AI algorithms to optimize logistics scheduling and scaling up the use of reusable packaging materials

toward the goal of becoming a world-class M&G.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 03

About M&G

As one of the world's largest stationery manufacturers M&G Stationery is a comprehensive stationery supplier and office service provider that integrates creative value and service advantages advocates a fashionable stationery

lifestyle and provides learning and work scenario solutions. It is committed to making learning and work happier and more efficient with products covering writing instruments student stationery office supplies and others. The

Company was officially listed on the SSE on January 27 2015 with the stock code 603899.M&G has an independent and complete business system covering brand and product design and development raw material procurement product manufacturing supply chain management warehousing and logistics and

marketing network management. It has nearly 70000 retail terminals nationwide and 900 retail stores such as Jiumu Store and M&G Life. At the same time it launches thousands of new products every year based on market

demand with its products exported to over 100 countries and regions and partners all over the world. As a popular domestic brand among Chinese consumers M&G is pioneering innovation in Chinese stationery achieving a

magnificent transformation from "Made in China" to "Created in China." In recent years M&G's diverse products have been featured at high-level international events such as the APEC Summit the Boao Forum for Asia and the Global

CEO Summit demonstrating the Company's realize the vision of becoming a "world-class M&G."

M&G Business System

Brand and product design Raw material Product Supply chain Warehousing Marketing network

and development procurement manufacturing management and logistics management

Retail stores such as Jiumu Store and Products exported to

M&G Life

900+100

+

countries and regions

Revenue Total number of employees Retail shops nationwide

RMB 25.06 billion 5503 Nearly 70000

year-over-year

UP 3 %Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 04

M&G Business Layout Corporate Culture

M&G is comprehensively promoting four product tracks—mass market stationery segment premium stationery

segment arts and kids drawing segment office stationery segment. It is actively exploring channel innovation

and vigorously developing large retail store business of Jiumu Store and M&G Life as well as general materials

digital procurement service business of Colipu Group. It has created an independent trendy cultural and

creative brand More-Than-Fun (Qizhihaowan) and has subsequently acquired and invested in Axus Stationery

(which owns the well-known wooden pencil brand Marco) and the Norwegian high-end spine-protection

backpack brand Beckman accelerating its international expansion and continuously expanding its brand matrix.Values

Consumer-centric mindset

openness and inclusiveness

sincerity focus and win-win

mindset

Cultural Core

Prioritizing the

well-being of others

before our own

Company Vision Company Mission

World-class M&G Make study and work more

joyful and effectiveForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 05

Ratings and Awards

MSCI ESG Rating Selected for the S&P Global CDP Climate Change Wind ESG Rating

AA Sustainability Yearbook 2026 B AA

2025 Exemplary Cases of 2025 Outstanding Practice Case

Biodiversity Conservation in of Sustainable Development 2025 China Corporate

Industry and Commerce for Listed Companies ESG 100 Index

Ministry of Ecology and Environment China Association for Public Companies People's Daily Overseas Online

Sustainability Pioneer Cases 2025 Corporate Green Transition Children's Charity Contribution

and ESG Practice Case Award

Corporate Sustainable Development Conference All-China Environment Federation Shanghai Children's Public Welfare FoundationForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 06

Sustainable Development Management

Sustainable Development Strategy

M&G has established its sustainability vision of "writing a sustainable business future." Centered on four strategic pillars: sustainable products response to climate change sustainable supply chain and empowering employees and

communities the Company has defined its 2022-2025 Sustainable Development Strategy. Committed to leading industry-wide sustainable development M&G focuses on advancing sustainable consumption green production

responsible sourcing employee growth initiatives and equitable education programs.Vision

Writing a sustainable business future

Strategic Positioning Becoming an industry leader in sustainable development including: Sustainable consumption green production responsible procurement focus on employee development and promoting equal education

Sustainable products Response to climate change Sustainable supply chain Empowering employees and communities

Producing sustainable Group-level carbon emission Supply chain management Management system of

products reduction targets system occupational health and safety

Sustainable design Improving energy efficiency Anti-corruption management Employee training and career

concept energy conservation and of supplier development system

Sustainable raw material consumption reduction Supplier capacity building Employee benefits

selection Optimizing energy Supply chain traceability Diverse and inclusive work

Four Pillars Chemical management consumption structure culture

system Green logistics Internal social support

Green office operation mechanism

Featured community activities

Systematic Foundation Responsible corporate governance: building a top-down corporate management and governance systemForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 07

M&G's Sustainable Development Goals

During the reporting period M&G officially released its 2030 Sustainable Development Goals promoting the transformation of ESG from a concept into quantifiable trackable and actionable initiatives and using these goals to

integrate sustainable concepts into business operations further. The goals were formulated based on research into domestic and international laws and policies reference to industry-leading practices and an assessment of the

Company's internal status. Following multiple rounds of discussions among the Company's core management team the implementation path and specific annual action metrics were finalized. As 2025 the first year of implementing

these quantifiable goals begins the Company has linked sustainability goals to the performance reviews of business unit heads. By implementing a management cycle of "monthly tracking quarterly review and annual

assessment" resources are allocated and timely adjustments are made in response to business evolution and environmental changes ensuring steady progress of all objectives.M&G's Sustainable Development Goals and Progress in 2025

Strategic

Pillars Goals

Baseline Target

Year Year Progress in 2025 Status

To adopt sustainable design for 20% of products / 2030 Total of 262 products adopting sustainable design In progress

Sustainable

products1 To perform sustainable product evaluation for / 2030 Fully integrating sustainable product evaluation into new product 100% of new product development development and review processes In progress

To reduce GHG emissions from our own operations (Scope 1

Response and Scope 2) by 42% 2021 2030 Reduced Scope 1 and 2 GHG emissions by 36% in 2025 compared to 2021 In progress

to climate

change2 To achieve carbon neutrality across the entire value chain. 2021 2050 Established an initial supplier carbon data management system and collected carbon data from 80% suppliers In progress

To ensure that 100% of key suppliers comply with M&G ESG guidelines / 2025 100% pass rate for key suppliers in ESG assessment and remediation Achieved

Sustainable 97 suppliers participated in the M&G ESG audit achieving 100% coverage

supply chain To ensure that ESG assessments and audits cover 80% of suppliers / 2030 of key suppliers In progress

To integrate ESG requirements into all new supplier screening and / 2025 Incorporated ESG risk assessment factors into the assessment system for onboarding standards new supplier development and onboarding Achieved

To ensure that 100% of full-time employees are covered by the

training system / 2028 Employee training coverage reached 85.6% In progress

Empowering

employees and To maintain zero severe injuries and fatalities annually 2024 / Zero severe injuries and fatalities Achieved

communities

To achieve 10 million instances of empowerment 2022 2030 Since 2022 the Shanghai M&G Charity Foundation's educational charity initiatives have generated over 2.03 million instances of benefit In progress

1. For more information on the definition and evaluation methods of sustainable products please refer to the "Product Stewardship – Sustainable Products" section of this Report.

2. Scope 2 GHG emissions reduction targets are set using a market-based accounting method.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 08

Sustainable Development Governance

M&G has established a clear and well-structured sustainable development governance framework that integrates top-down coordination. During the reporting period the Company released its Environmental and Sustainability

Policy 3 further clarifying a tiered governance system comprising the Board of Directors the Strategy Committee the Sustainability Office various business units departments and subsidiaries that drive the implementation of

sustainability strategy initiatives. The Company has established a Sustainability Office led by the Chief Sustainability Officer (CSO). The team members possess professional expertise and experience in sustainability. To support key

projects under annual goals the Company runs focused training sessions for managers on new trends and related topics to strengthen science-based decision-making skills across all governance levels.M&G's Sustainability Governance Framework and Responsibilities

* Responsible for the comprehensive management and oversight of the Company's sustainable

development impact risks and opportunities; reviewing and approving sustainable

development strategies goals and disclosures; and supervising and reviewing sustainable

Board of development-related policies management practices performance and target progress.Decision-Making Directors

Strategy

Committee * Responsible for breaking down sustainable development goals into actionable targets;

* Coordinating role assignments across business operations conducting internal and external

sustainability communications and dissemination;

* Identifying and tracking ESG risks and opportunities;

* Reporting progress on strategic objectives to the Strategy Committee regularly.Coordination Sustainability Office

Execution All business units

* Responsible for the implementation of specific projects to achieve sustainable

departments and subsidiaries development goals.The Company implements dynamic monitoring and hierarchical management of ESG performance. Each business unit department and subsidiaries gathers and regularly reports key ESG data. The Sustainability Office tracks

ESG performance in real time using the strength of sustainability governance as a measure of each function's efficiency thereby reinforcing management accountability. Based on this feedback the Board's Strategy Committee

reviews progress on key goals and allocates resources to link ESG aims with operations. Concurrently the Company integrates sustainability-related impacts risks and opportunities into business decision processes. This includes

prudent collaboration with high-risk suppliers and partners or implementing risk management in line with standard procedures to ensure the precise implementation of the sustainability strategy thereby laying a solid governance

foundation for the organization's long-term resilient growth.

3. M&G's Environmental and Sustainability Policy has been published on the Company's official website under the "Investor Relations – ESG – Reports and Policies" section.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 09

Management of Sustainability Topics

Double Materiality Assessment

The materiality assessment of sustainability topics serves as the foundation for M&G's sustainability planning internal and external communication and information disclosure. In accordance with the requirements of the SSE

Sustainability Report Guidelines the Company conducted a quantitative upgrade of our assessment methodology this year effectively linking sustainability-related opportunities and risks with specific financial metrics. Through

policy analysis peer benchmarking internal workshops and cross-department interviews we systematically identified and assessed "double materiality" with respect to the potential impacts of existing sustainability topics on our

finances (financial materiality) and our actual and potential impacts on the economy society and the environment (impact materiality). After submitting the assessment results to the Company's Risk Management and Compliance

Committee for review and confirmation we developed M&G's 2025 Sustainability Material Topic Matrix. In the future we will further optimize the assessment methodology for double materiality topics enhance the level of

quantification and accuracy of the financial materiality assessment and disclose it when the time is right communicating transparently with stakeholders.By analyzing sustainability trends and industry dynamics based on the requirements of the SSE M&G's 2025 Sustainability Material Topic Matrix

Sustainability Report Guidelines and in conjunction with M&G's strategic planning and operational

priorities we updated and confirmed 18 sustainability topics. Compared with the topics identified

Topic Library in 2024 the following changes were made: "Labor rights" "Employee benefits" and "Training and Marketing and after-

Update salesdevelopment" were merged into the "Employee rights and development" topic "Product quality" Product quality and

and "Chemical safety" were merged into the "Product quality and safety" topic "Response to climate Business ethics Occupational health

safety

change" and "Carbon emissions and energy management" were merged into the "Response to and safety Technological

climate change" topic. Employee rights and innovation

development

Based on the confirmed list of topics and through benchmarking studies internal workshops

Risk and and business interviews we established a mapping relationship of "topics-processes-impacts" Information

Opportunity security and privacy

Identification preliminarily identified and verified the trigger points of key risks and opportunities in business protection Environmental

processes and clarified the chain of impact transmission on our operations. Supply chain

Social welfare compliance and pollutant management

Diversity and equal management Sustainable

Financial materiality assessment: Based on risk and opportunity identification we matched each opportunities Risk management products

topic with existing accounting items and available financial data established a basis for quantitative Corporate

analysis scored each topic for the degree of financial impact and likelihood of occurrence and based governance

on the composite average score calculated as well as defined thresholds prioritized the topics with

financial materiality After incorporating the opinions of internal experts and senior management we

Topic

Materiality formed the financial materiality assessment results for all topics.Assessment Impact materiality assessment: We distributed survey questionnaires to 13 stakeholder groups Biodiversity

including Board members investors employees suppliers and consumers inviting them to Waste management Response to climate change

score each topic across two dimensions: degree of impact and likelihood of occurrence. Weighted Water utilization

calculations were performed on the scores based on the perspectives of each group and the topics

were then prioritized. This year a total of 742 valid questionnaires were collected.Development Based on the results of financial materiality assessment and impact materiality assessment we Not material Financial Materiality Material

of the Double

Materiality prepared a topic matrix and reported it to the Company's Risk Management and Compliance

Matrix Committee. M&G's double materiality topic matrix was thus reviewed and confirmed. Note: In this Report a topic marked with " " is financially material as assessed by the Company.High Impact Materiality GeneralForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 10

Impacts Risks and Opportunities

M&G follows the principle of double materiality and attaches great importance to the potential impacts of sustainability topics on our business value especially those with high financial materiality. Through a systematic assessment

mechanism we identify and manage the risks and opportunities associated with these topics to enhance our strategic resilience and create long-term value. The Company has integrated the management of sustainability-

related risks and opportunities into our overall strategy and enterprise-wide risk management system. Leveraging our existing the "three lines of defense" risk management system we have clarified the responsibilities of business

departments functional departments for risk management and the Audit Department established a normalized risk monitoring and early warning mechanism and ensured that material financial risks are preventable and

controllable.Topic Specific Risk/ Impacts Affected Value Metric Opportunity Timeframe4 Chain Processes Potential Impacts Response Measures

Upstream of Stricter higher-level product quality testing and

the value chain chemical management require additional capital Strengthen the development of the product quality and

Short

corporate investment. Meanwhile quality-related negative safety management system to reduce quality risks while

Product quality Risk medium and

operations incidents may lead to product recalls damage to brand strictly controlling the quality and safety of raw materials

long term

downstream of reputation and other consequences thereby affecting and finished products across the supply chain.the value chain our revenue.Product quality

and safety

Consumers are paying increasing attention to the health Continue to invest in the R&D of food-grade children's

Healthy and safety of stationery products. High-value-added art supplies while implementing chemical safety

Medium and Downstream of

and safe Opportunity products with higher safety standards can unlock new management standards that are more stringent national

long term the value chain

products profit growth drivers and promote growth in revenue standards and raise consumers' awareness of product

and operating performance. health and safety.If our core technologies are infringed upon or

Improve the intellectual property compliance

maliciously imitated by third parties our differentiated

Corporate management system embedding intellectual property

Intellectual competitive advantage may be weakened leading to the

Medium and operations risk identification into the end-to-end business process

property Risk loss of market share and potential revenue. Additionally

long term downstream of and join forces with multiple parties to strictly combat

protection involvement in intellectual property disputes or

the value chain infringement safeguarding market share and brand

litigation may result in extra legal and compliance costs

reputation.as well as compensation liabilities.Technological

innovation

Through automated production and process

improvements we can directly reduce energy material

Innovation

and labor costs and improve profit margins. Over the By establishing an R&D innovation system and increasing

in materials Medium and Corporate

Opportunity long term technological innovation is favorable for R&D investment we continuously enhance our

process and long term operations

higher product pricing new business expansion and technological innovation capabilities.design

asset revitalization bringing sustainable value creation

to the Company.

4. Definition of time horizons: Within one year is short-term one year to five years is medium term and more than five years is long term.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 11

Topic Specific Risk/ Impacts Affected Value Metric Opportunity Timeframe4 Chain Processes Potential Impacts Response Measures

Upstream of The extent to which suppliers manage their governance Improve the supplier ESG risk assessment system

Responsible Risk Short term the value chain environmental and labor practices affects the stability

incorporate ESG metrics into supplier onboarding

procurement corporate and security of the supply chain as well as our management and performance evaluation and support

operations reputation and profitability. suppliers in enhancing their ESG risk management capabilities.Supply chain

management Upstream of Green procurement brings opportunities for the Establish a product carbon footprint accounting and

the value chain Company to enhance supply chain resilience meet analysis platform integrate the carbon footprint concept

Green Medium and corporate market demand for low-carbon products and obtain a into the product life cycle support the development

procurement Opportunity long term operations green premium. Despite the increase in procurement of a low-carbon product series and actively carry out

downstream of costs in the short term due to material upgrades it helps supplier empowerment training to promote coordinated

the value chain reduce compliance risks and enhance brand value in the green and low-carbon transformation across upstream long term. and downstream.The unit purchase prices of sustainable raw materials Conduct joint supply chain R&D and innovation expand

Upstream of such as recycled materials and bio-based materials are

upstream and downstream cooperation build a circular

Sustainable economy system and drive cost reduction through the

materials Risk Short and the value chain

higher than those of traditional raw materials which

medium term corporate may increase production costs. Meanwhile ensuring

scaling up of substitute materials; meanwhile closely

substitution operations compliance of raw materials through traceability and

follow policy trends and market dynamics carry out

green certification incurs management and compliance certification based on demand and optimize the

costs which can constrain short-term profits. effectiveness of resource allocation for sustainable

Sustainable products.products

With growing consumer attention on the environmental Clarify quantitative strategic objectives for sustainable

Green Medium and Downstream of attributes of products proactively developing a green products formulate the Sustainable Product Evaluation

consumption Opportunity long term the value chain product portfolio presents an opportunity to expand Standards and gradually integrate the sustainability differentiated growth while building long-term market concept into the entire chain of product development

competitiveness and revenue streams and marketing.Acute and Upstream of

chronic Short the value chain corporate Heightened regulatory compliance requirements and Develop and implement carbon emission reduction physical risks Risk medium and operations increased climate-related physical and transition risks targets and plans and continuously advance energy and transition long term downstream of the increase operating costs across multiple dimensions. conservation and emission reduction initiatives.risk value chain

Response

to climate

change5 Resource Upstream of Improvements in resource and energy use efficiency Improve data management and the quality of

efficiency Short the value chain driven by the low-carbon transition can reduce operating information disclosure to enhance the transparency of

brand Opportunity medium and corporate energy consumption expenses and hedge against climate actions and performance; embed the climate reputation long term operations potential carbon trading costs and enhanced climate strategy into corporate governance and our brand

and market downstream of the governance helps improve ESG ratings and strengthen culture and continuously enhance the brand's green

opportunities value chain brand credibility. assets.

5. For more information on climate risk-related disclosures please refer to the "Climate and Environment - Response to Climate Change - Strategy" section of this Report.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 12

Stakeholder Engagement

M&G is committed to establishing two-way unimpeded and regular communication channels with all stakeholders. Through diverse communication formats we enable timely understanding and addressing of stakeholders'

concerns and expectations.Government

and Regulatory Shareholders Consumers and and Investors Customers Suppliers Channel Partners Employees

Community and Industry

Departments General Public

Media Associations

Product quality Marketing and Sustainable products Business ethics Business ethics Occupational health and Waste management Environmental Sustainable

and safety after-sales safety compliance and products

Supply chain Product quality Marketing and Environmental pollutant control

Supply chain Product quality management and safety after-sales Product quality and safety compliance and Employee rights

management and safety pollutant control Product quality and development

Business ethics Supply chain Technological Employee rights and and safety

Concerned Social welfare Supply chain management innovation development Response to climate Workplace health

Material management change Sustainable and safety

Topics Business ethics Technological products

innovation Product quality and Business ethics

safety

Company

governance

Special reports General Product sales and Bidding Channel Internal emails Collaboration and Official website Forums and

meetings promotion cooperation exchange and corporate seminars

Participation Supply chain conference Performance interview WeChat account

in government Investor After-sales service conference Charity projects and Participation in

meetings meetings Marketing Employee satisfaction survey activities Media interview industry standard

Consumer survey Contract signing conference and cooperation formulation

Supervision and Performance and execution Training and workshop Official website

assessment briefings Customer Market visits and WeChat official Forums and Project

satisfaction survey Daily business Employee clubs and account seminars collaboration

Field research Information communication Daily business activities

disclosure Exhibition events communication Information Visit and

Communication Information Supplier training Annual company meeting disclosure communication

Mechanisms disclosure Official website and

and Methods corporate WeChat Supply chain esg Internal corporate culture

account assessment and platform

on-site audit

Employee suggestion

platform

Cooperation and dialogue

Public welfare projects and

activities

Official website and

corporate WeChat accountForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 13

Focus: Sustainable Product Innovation and Practice

Sustainable products are a core pillar of M&G's sustainability strategy. Since the launch of the carbon-neutral product series in partnership with Meituan's "Lush Mountain Plan" in 2023 we have gradually established a systematic

sustainable product development system prioritizing the use of recycled recyclable and biodegradable materials. By implementing the Sustainable Product Evaluation Standards6 we have integrated sustainability evaluation into

the new product R&D process enhancing the sustainability attributes across the entire product life cycle. Meanwhile we actively innovate consumption scenarios promote cross-industry collaboration and co-creation and translate

"Writing a Greener Future" from a brand proposition into concrete actions to build a green consumption ecosystem.Sustainable product strategy and goals 2025 highlights and progress

Sustainable design was adopted for 262 products.By 2030

Products adopting sustainable New product development undergoing Sustainable product evaluation was fully integrated into the new product development and

design sustainable product evaluation review processes.The "Huanbaoji" sustainable product portfolio was optimized with the newly launched

20 100 LOHAS sustainable lifestyle series and "Eco+ Office" low-carbon product series.% %

Sustainability communication activities reached over 440 million individuals throughout

the year.Sustainable Product Portfolio Layout

M&G continues to improve the "Huanbaoji" sustainable product portfolio through insights into the needs of individual consumers and corporate customers. We have established a differentiated sustainable product strategy for both

the retail and corporate business providing the market with diverse green product options.Centered on the two core themes of "biodiversity" and "sustainable lifestyles" we translate Focusing on the green transformation needs of government and enterprise procurement

broad sustainability topics into tangible product experiences adding another emotional and leveraging product life cycle assessment we provide corporate customers with end-to-

element to eco-friendly raw materials and building deep resonance on environmental end solutions from green design to carbon reduction quantification by delivering verifiable

values and emotional connection between the brand and young consumers. and traceable emissions reduction data."Writing a Greener Future" Green Label

M&G references relevant domestic and international standards and certification specifications for green products has formulated and implemented the

Sustainable Product Evaluation Standards 6 and conducts comprehensive evaluations of products from product safety resource conservation green and low-

carbon sustainable design and social value dimensions.For products that passed the evaluation we have designed an exclusive green label symbolizing green circulation. Consumers can quickly identify M&G

sustainable products through the green label on the packaging thereby making more eco-friendly consumption choices with ease. M&G Sustainable Product Green Label

6. For more information on the Sustainable Product Evaluation Standards please refer to the "Product Stewardship - Sustainable Products" section.

Corporate business

(To B)

Retail business

(To C)Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 14

Sustainable Product Series

"LOHAS" Series "Endangered Animals: Wetland" Series

The barrel of the polylactic acid (PLA) biodegradable This series uses polylactic acid (PLA)

gel pen in this series is made of polylactic acid biodegradable materials and recycled plastics

derived from biomass such as corn and can naturally as the primary raw materials for pen barrels

decompose under composting conditions after helping to reduce plastic waste and pollution. By

disposal. minimizing the risk of animals ingesting plastic

or becoming entangled in it the design aims to

The barrel of the mechanical pencil in this series is made

protect wildlife.from recycled polypropylene (RPP) effectively enabling

resource circularity. In collaboration with the Mangrove Conservation

Foundation (MCF) the series incorporates the

Parts of the recycled ruler set are made from recycled

images of five endangered wetland species

plastic bottles and the packaging features a reusable

including the Black-faced Spoonbill and Oriental

design—after use it can be transformed into a 6-inch

Stork into its packaging. This initiative raises

photo frame.consumer awareness of wetland conservation

The reduced-plastic correction tape features a hollowed- and biodiversity.out casing design cutting plastic usage by 20%."Eco+ Office" Low-Carbon Product Series "Rare Animals" Series

All plastic components of the series have been In collaboration with the Center for

replaced with recycled plastics significantly Environmental Education and Communications

reducing the use of virgin plastics and cutting the of the Ministry of Ecology and Environment M&G

products' carbon footprint at the source. launched the "Earth Guardians" initiative and

jointly introduced a series of stationery themed

Each product has completed a full life cycle carbon around rare animal conservation including gel

footprint calculation with reference to the ISO pens kraft paper notebooks and other writing

14067 standard. As of the end of the reporting instruments.

period a total of six products had obtained

carbon footprint certificates issued by third-party The notebook series is co-developed by M&G

organizations ensuring the together with value chain partners Suzano and

accuracy and transparency Sun Paper achieving carbon neutrality across

of emissions reduction data. the full life cycle from raw material sourcing

transportation production use to disposal. It is

the first paper product in China to obtain the ISO

14068-1 Carbon Neutrality Verification Statement.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 15

Sustainable Design

In 2025

M&G fully embeds the Sustainable Product Evaluation Standards into our new product R&D management system and organizes dedicated training on sustainable product

design for product designers driving sustainable concepts to extend from writing instruments to our full range of business categories. We take lightweight reuse recycling Sustainable design was adopted for

and safety and health as the core principles of sustainable design aiming to optimize the environmental performance throughout the full life cycle of our products from raw

material sourcing to end-of-life disposal. By the end of the reporting period we had adopted sustainable design for 262 products and in the future we will continue to scale

up R&D and market supply of sustainable products. 262 products

M&G Drop-Shaped Retractable Gel Pen M&G Professional High-CapacityOil-Based Fineliner M&G Clean-Erase Erasable Colored Pencils M&G Plastic Document Box

Lightweight design: The pen barrel adopts Extra-large capacity design: Each pen Recyclable packaging: The pencils are Material structure optimization: On the

a drop-shaped hollow-out design reducing writes as long as two standard fineliners packaged in kraft paper boxes using single- premise of strictly ensuring the product's

plastic use by 15% with a lighter feel in offering extended longevity and excellent color printing to reduce environmental mechanical performance and appearance

hand. cost-performance. impact. quality we achieved 30% to 40%

replacement of virgin plastic with recycled

Paper savings: Errors can be quickly erased

plastic in product components.and adjusted to minimize paper waste.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 16

Green Consumption Advocacy In 2025

Sustainability-related marketing

M&G is committed to leveraging its brand influence to promote the widespread adoption of sustainable consumption by establishing a multi-dimensional mechanism to activities reached

guide green consumption and mobilizing the strengths of all sectors. During the reporting period our sustainability-related marketing activities reached over 440 million +

individuals. 440 million individuals

End-use scenario development "Green Credits" incentives

Across more than 860 nationwide Jiumu Stores a dedicated sustainable Jiumu Store has established a "Green Credits" member incentive

products section has been set up at the core endcap location of the pen mechanism. Consumers who purchase products bearing the M&G Green

display counter. In partnership with suppliers we have also introduced Label at our stores or in the membership mall can earn Green Credits.environmentally friendly corrugated cardboard display racks rolled out by Through quantified benefits and rewards we cultivate consumers' low-

channel partners in 12 provinces driving green collaboration across the carbon purchasing habits. During the reporting period 12.3 million Green

distribution network. Credits were issued.Jiumu Store's "Lights Off for One Hour" Pop-up Event

Integrated marketing communications Participation in international agendas

The Company deepens sustainable communications through coordinated M&G sustainable products frequently feature at high-level international

online and offline channels. Online dedicated sustainable product sections forums and major industry events. During the reporting period these

have been established on our self-operated e-commerce platform and products were showcased at major domestic and international events

themed marketing campaigns are carried out in collaboration with major including the Boao Forum for Asia the Shanghai International Carbon

platforms such as Tmall and JD we partner with One Planet Foundation Neutrality Expo and the 2025 United Nations Climate Change Conference

(OPF) to carry out pop-up events themed on "Lights Out for One Hour" (COP30) demonstrating the China's stationery industry's practical

"Happy Cooperation" etc. transforming sustainable concepts into tangible achievements in responding to climate change and advancing the circular

interactive experiences. economy to a global audience.M&G Sustainable Products at the Boao Forum for Asia

Case "Happy Cooperation" Pop-up: Evoking Resonance with Sustainable Values among Young Consumers

On July 5 2025 M&G partnered with OPF to host the "Happy Collaboration" themed pop-up event at HAI550 a landmark for sustainable lifestyles

in Shanghai. Taking signing and contract execution as the creative starting point the event created an immersive space for people to enter into

agreements with nature and with all things making M&G Sustainable Products a connection point between consumers and a better life and

establishing an emotional contract between the brand and young consumers.During the event M&G launched the new "LOHAS" series of "Huanbaoji" and pledged to donate 1% of the series' sales revenue directly to OPF

turning consumer participation into tangible actions to protect the Earth. On the day of the event emerging star Yuncheng He appeared as

the "Sustainable Living Advocate" collaborating with influencers across multiple fields for interactive sharing. Together with seven brands the

initiative achieved cross-sector engagement generating over 50 million total impressions and 2.6 million interactions. It not only expanded the

reach of sustainability topics beyond traditional circles but also reshaped public perception turning sustainable living into a lifestyle that is easy

to experience participate in and share."Happy Collaboration" Pop-up EventForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 17

Product

Stewardship

As one of the world's largest stationery manufacturers

M&G Stationery has always adhered to a consumer-

centric approach and established a responsibility

management system covering the entire product

life cycle. We exercise stringent control over quality

and safety promote sustainable product innovation

and continuously optimize after-sales services

and marketing mechanisms. Through integrity in

operations and an outstanding experience we have

earned long-term trust from consumers. In the future

we will continue to craft products with dedication

promote green consumption through responsibility

and lead the industry's sustainable development.Our goals

By 2030

To adopt sustainable design for 20%

To perform sustainable product evaluation for 100%

Topics addressed in this section

Sustainable products

Product quality and safety

Marketing and after-salesForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 18

Sustainable Products

M&G deeply embeds sustainability requirements into its business processes by building a full life cycle management approach spanning from R&D design to production and manufacturing ensuring that every green innovation can

be accurately translated into a high-quality product experience. We strive to achieve breakthroughs in key areas such as sustainable material substitution low-carbon process improvements and packaging lightweighting and take

concrete actions to fulfill our long-term commitment to consumers and the environment.Governance Strategy Opportunity and Risk Management

M&G has established a sustainable product governance structure with M&G continues to focus on the market opportunities brought about M&G has established a systematic mechanism for managing sustainable

clear responsibilities to ensure the effective implementation and oversight by the green and low-carbon transition. We have identified that policy product opportunities and risks. On the opportunity side by regularly

of the sustainable product strategy. The Board of Directors and its Strategy guidance and shifts in consumer preferences are jointly driving growth conducting market research benchmarking against competitors

Committee review and oversee the strategic direction goal setting and in demand for sustainable products presenting us with opportunities participating in industry conferences and standard-setting we

key management systems for sustainable products. We have established a to optimize our product mix and secure long-term growth drivers. In proactively assess the market opportunities arising from green

cross-center sustainable product development task force coordinated by the process of implementing our strategy we simultaneously identify consumption trends and China's "Dual Carbon" strategy. On the risk

the Sustainability Office to promote the application of sustainable design and manage associated transition risks particularly the risk of rising side backed by the Company's quality control system we prudently

concepts in our products and drive sustainable product development costs of sustainable material procurement and compliance certification. identify and address transition risks arising from the green premium

from the front end of design. The supply chain production and technical To address this we will leverage technological innovation and lean for sustainable materials and compliance certifications ensuring that

departments are responsible for implementation such as the adoption management to balance environmental investments with business our products meet market access standards and customer needs in

of sustainable materials and the development of sustainable suppliers. returns ensuring the robust implementation of its sustainability strategy. domestic and overseas markets.We have established strategic goals for sustainable products and

incorporated the number of sustainably designed products as a bonus

item in the annual performance evaluations of the heads of relevant

business centers thereby achieving a closed-loop execution mechanism

from strategic goals to management accountability.Targets Management Measures and Performance

Strategic Pillars Goals Progress in 2025

To adopt sustainable design for 20% of products by 2030. Total of 262 sustainable products adopting sustainable design.Sustainable products

To perform sustainable product evaluation for 100% of new product Fully integrating sustainable product evaluation into new product

development by 2030. development and review processes.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 19

Sustainable Product Evaluation

M&G released its first sustainable product evaluation standards in 2023 and in 2024 expanded the scope of application from writing instruments to multiple product lines. It has now been fully applied to the new product

development process. Drawing on both domestic and international green product certification frameworks and tailored to the characteristics of our product portfolio the Standards conduct a comprehensive evaluation across

five dimensions: product safety resource efficiency green and low-carbon performance sustainable design and social value. Through this approach we have established a differentiated and industry-leading sustainable product

evaluation system.7

M&G Sustainable Product Evaluation Dimensions

Product safety Resource efficiency Green and low-carbon impact Sustainable design Social value

Comply with M&G's control Use sustainable materials with Reduce carbon emissions Adopt longer-lasting replaceable Procure from suppliers that meet

requirements for product quality environmental certifications or throughout the product life cycle reusable repairable or more M&G ESG requirements; promote

and chemical safety (mandatory recycled/reclaimed content; use and obtain relevant green product universal designs. sustainable concepts in product

compliance item). recyclable reusable safer and more certifications. design elements.environmentally friendly packaging

materials.Green Product Certification

M&G actively responds to policy guidance and customers'

green procurement needs and has developed a portfolio M&G Products Obtaining Sustainability-related Certifications in 2025

of green-certified products as well as products made with Certification Category Standard/Certification Product Examples

certified sustainable materials. The recycled plastic used in EU RoHS Certification Packaging tape etc.the "Huanbaoji" series gel pens is certified under the Global

Recycled Standard (GRS). The Red M&G Multifunctional China RoHS Certification Smart chessboard portable timer rotary timer etc.Printer Paper holds Forest Stewardship Council (FSC) Safety-related

Certification. Multiple laser printers have obtained China EU REACH Regulation Ink used in heat erase gel pens and highlighters

Energy Conservation Product Certification; Other products EU EN 71-3 Safety of Toys M&G Safe Crayon of MG Kids collection modeling clay etc.such as copy paper and toner cartridges have obtained

China Environmental Labeling Product Certification (Ten Certification under China's Hygienic Requirements of Study Products for Myopia Prevention and Control in Children and Eye protection printer paper etc.Ring Certification). We have continued to expand both Health-related Adolescents

the range of green certifications and the scope of certified German IGR Ergonomics Certification Spine protection schoolbag

products. Meanwhile Colipu Group has incorporated

+

environmental management and green product-related ISO14067 Product Carbon Footprint Certification "Eco Office" Series stapler whiteboard marker permanent marker glue stick etc.metrics into the supplier access evaluation system. As of

the end of the reporting period Colipu Mall offered nearly ISO14068 Carbon Neutral Certification "Rare Animal" Series notebook

1500 products with green certifications including China GRS Certification Recycled plastics used in "Huanbaoji" Series gel pens

Green Product China Environmental Labeling Product (Ten Environment-related

Ring Certification) FSC and Program for the Endorsement China Environmental Labeling Product Certification (Ten Ring Certification) Printer paper toner cartridges for laser printer

of Forest (PEFC) effectively driving the value chain's

transition toward green development. China Energy Conservation Certification Monochrome single-function laser printer

FSC Certification Red M&G multifunctional printer paper

7. For some product cases that passed this evaluation system please refer to the section "Focus: Sustainable Product Innovation and Practice"Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 20

Case Colipu Group's Low-Carbon Supply Chain Development

In October 2025 at the 12th Shanghai Supply Chain Development Conference hosted by the Shanghai Supply

Chain Development Conference Colipu Group was awarded the title of "2025 Shanghai Low-Carbon Supply

Chain Benchmark Enterprise" becoming the only enterprise in the government and enterprise procurement

sector to receive this honor. The 2025 Shanghai Low-Carbon Supply Chain Benchmark Enterprise Casebook

released at the conference aims to showcase and promote best practices in carbon reduction and green

development highlighting supply chain leaders that have made outstanding contributions to low-carbon

transformation. Colipu Group was selected for inclusion with its innovative case "From Green Procurement

to Digital-Intelligent Collaboration: Building a Low-Carbon End-to-End Value Chain." In addition in terms

of green management system development Colipu Group obtained the GB/T 33635-2017 Green Supply

Chain Management System Certification in 2023 and for its outstanding performance in environmental

management social responsibility resource utilization and circular economy was rated at the highest level

(five-star).Colipu Group Awarded "2025 Shanghai Low-Carbon Supply Chain Colipu Group's Green Supply Chain

Benchmark Enterprise" Management System Certification

Five-Star Certificate

Sustainable Materials

M&G expands the application of new materials in products through materials R&D and technological innovation. In terms of plastic applications by using

recycled plastics bio-based (biodegradable) plastics and filler materials we reduce our reliance on traditional petroleum-based plastics. Meanwhile

the Company continues to strengthen traceability management of sustainable raw materials prioritizing the procurement of materials certified by third

parties (e.g. GRS and FSC) and selecting materials that meet food-grade safety standards for children's art products thereby enhancing the health and

safety performance of the materials. Taking writing instruments as an example we have innovatively developed and applied lead-free eco-friendly pen

tip materials to prevent lead contamination and harm to human health at the source of production and have also developed Pickering emulsion ink to

enable longer writing length with the same ink volume thereby extending product lifespan and reducing waste generation.Ballpoint Pen using Pickering Emulsion Ink

Case Beckmann Promotes Plastic and Carbon Reduction across its Full Product Line

Beckmann a subsidiary of M&G is committed to driving the sustainable transformation of the textile industry through the application of circular

materials. Since 2002 Beckmann has incorporated recycled polyester (RPET) fabrics into its schoolbag range and now uses recycled materials

derived from post-consumer plastic bottles as the primary input for all schoolbags. Certified under GRS and OEKO-TEX STANDARD 100 these

materials ensure traceability and safety while reducing CO2 emissions by 70%.Beckmann is also advancing further green solutions including R&D to shift lunch boxes and water bottles to stainless steel and plans to replace

virgin low-density polyethylene (LDPE) packaging with 100% recycled LDPE from 2026. This enables plastic reduction and circular substitution

across core products and accessories reinforcing its commitment to the circular economy and setting a benchmark for low-carbon development in

the global stationery and education supplies sector. Beckmann Recycled

Plastic Product

LabelForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 21

Sustainable Packaging

In 2025

M&G promotes the green transformation of packaging through initiatives across three major dimensions: eco-friendly material selection lightweight design and circular

packaging. In terms of material selection we prioritize the use of biodegradable and recyclable materials for product packaging. All paper boxes used for the Company's M&G and its subsidiaries reused cartons

self-manufactured products are printed with environmentally friendly soy-based ink which is more readily biodegradable and effectively reduces volatile organic compound cumulatively

(VOCs) emissions during the printing process. During the design stage we implement the lightweight principle by removing redundant packaging layers optimizing

packaging dimensions and promoting minimalist designs. While ensuring product safety and user experience we minimize material consumption to the greatest extent

possible. Meanwhile we actively promote the circular use of logistics packaging by establishing a second-hand carton recycling system across e-commerce shipments

store deliveries and inter-plant transfers to reduce the single-use of cartons. M&G Logistics Center identifies opportunities to streamline packaging for existing products. It 2.25 million

has replaced the logistics packaging for markers with cardboard and courier bags and promoted this solution across 48 products covering approximately 140000 parcels.During the reporting period by actively promoting packaging recycling and reuse M&G and its subsidiaries reused 2.25 million cartons cumulatively.Case Display Rack Improvements Achieve Dual Benefits in Plastic Reduction and Cost Relief

Conventional notebook display racks are prone to product tilting and deformation which can affect in-store presentation. After receiving feedback from channel partners we immediately launched a dedicated

improvement initiative to address these issues. We redesigned the support structure optimized rack configuration and back panel height and precisely adjusted the bottom tilt angle effectively resolving stability issues

while reducing plastic usage by approximately 20%. Following this structural optimization and upgrade reduced plastic usage enabled a roughly 50% decrease in both cost and selling price per display rack effectively

improving channel profitability while reducing environmental impact. This resulted in dual benefits of "plastic reduction" for the racks and "cost relief" for distributors.Plastic usage reduced by approximately

20%

Costs and selling prices simultaneously

decreased by approximately

50%

Conventional Racks Cause Products to Tilt Forward Optimized Racks Enhance Product Display QualityForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 22

Product Quality and Safety

M&G regards high-quality products and services as the lifeline for our survival and development and as the cornerstone for winning consumer trust and achieving sustainable development. We have established a quality management

system covering the full product life cycle integrating quality and safety concepts into every step of R&D procurement production sales and services. With outstanding product quality we safeguard consumers' rights and interests

and fulfill our commitments to stakeholders.Governance Strategy

M&G has established and continuously optimized the governance and M&G has established a normalized product quality and safety risk control mechanism and prudently manages the financially material impacts

management structure for product quality and safety. The Board of Directors of product quality and safety risks on our long-term competitiveness. In terms of quality management we have established a sound quality

is responsible for approving the Company's overall product quality and safety management system covering the entire product life cycle by formulating and implementing internal policies and procedures such as the

strategy guidelines and major policies and regularly monitoring trends in Management and Control Procedure for Product Safety the M&G Product Audit Sampling Mechanism and the Quality Risk and Opportunity

key performance metrics. At the management level the President and the Control Procedure thereby preventing unexpected operating losses resulting from rework scrapping and compliance penalties. In terms of

responsible Vice President are responsible for formulating our product quality chemical safety the Company through the Chemical Management Policy clearly sets out specifications on chemical management principles the

and safety strategic guidelines. For chemical safety we have established a prohibition and phase-out of chemicals safety standards and certification requirements product audits and suppliers' chemical management. In

Chemical Management Committee composed of the Sustainability Office accordance with updates to laws regulations and policies key points of consumer and market concern and the expansion needs of our business

Procurement Center Production Center Technical Center and Quality Center. and products we regularly update the "High Concern Chemicals Control List" for prohibited or restricted chemicals to avoid legal compliance risks

The committee is responsible for coordinating chemical-related management and proactively make adequate preparations in advance for potentially more stringent international chemical safety standards during our overseas

matters and advancing the implementation of the chemical restriction and expansion process. In addition we proactively identify consumer groups' demand for higher safety and quality. By expanding the use of safer

phase-out plan. All product departments the Production Center Quality materials such as food-grade materials we seize opportunities for differentiated competition and brand premium amid the wave of consumption

Center Technical Center Procurement Center and Supply Chain Management upgrading.Center jointly carry out full-process quality inspection and control from

product development and design raw material procurement to product

shipment.M&G Quality Management System M&G Product Quality Control Process

M&G has set up a dedicated Quality Center building a quality management

system that includes Quality Control (QC) Quality Assurance (QA) and Quality Design and * Define product quality objectives and requirements and verify the feasibility and rationality of the design;

Development

Engineering (QE). The system covers the entire process from product design * Produce samples and conduct performance and reliability tests improving designs based on test results.and development raw material procurement production processes finished

product inspection to after-sales service. Meanwhile for writing instruments * Evaluate and select suppliers in strict accordance with supplier management measures and sign quality

our core category we have established eight detailed control checkpoints Raw Material

Procurement agreements to define quality requirements and responsibilities;

including new product review product assembly inspection retention * Inspect raw materials upon arrival using sampling or full inspections determining acceptance based on results.sample management and grid-based business partner management and

defined inspection procedures and guidelines for each checkpoint. During the

reporting period the Quality Center systematically reviewed our overall quality * Establish key quality control points and conduct scheduled inspections and sampling to monitor production

management system updated the Quality Management Control Procedures Production process stability;

and formulated the Injection-Molded Parts Inspection Management Provisions Process * Operators perform self-inspections and mutual inspections and strictly segregate label review and handle

Assembly Inspection Regulations and other policies further improving the non-conforming products.product quality management system and quality control processes.* Conduct final inspection on product appearance performance and packaging according to quality standards;

Final Product

Inspection * Process warehousing for qualified products and handle non-conforming products according to non-

conformance procedures.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 23

Risk Management

M&G incorporates product quality and safety risks into the overall risk management system. By benchmarking

against internationally recognized management standards such as ISO 9001 the Company has established

specific management system policies and objectives. Through regular internal audits and monthly statistical

analysis of non-compliant items we implement closed-loop tracking and verification of corrective and preventive

measures. At the same time leveraging the continuous improvement methodology of the M&G Business System

(MBS) we carry out cross-center special improvement projects to ensure the sustained and robust operation of

the quality management system and to drive continuous improvement in product quality.M&G Headquarters and Core Subsidiaries (e.g. Colipu Group and Axus Stationery) Have All

Management Measures and Performance Passed ISO 9001 Quality Management System Certification

M&G has continued to carry out dedicated quality improvement initiatives to enhance product quality and safety and with a craftsman's spirit of excellence to build a benchmark for high quality. We continue to strengthen

chemical safety management to standards more stringent than the requirements of laws regulations and supervision and gradually phase out chemicals of high concern. We proactively seek alternative materials with higher safety

while continuously improving product information disclosure to enhance transparency in product safety. During the reporting period the Company did not experience any significant responsibility incidents related to the safety and

quality of products and services.Quality Improvement Initiative

M&G deeply embeds lean management into our quality governance system. Drawing on the essence of the Danaher Business System (DBS) and integrating it with our business realities we have developed the M&G Business System

(MBS) methodology. Focusing on continuous improvement a nine-step process—covering topic selection current-state assessment root cause analysis countermeasure implementation and recurrence prevention—creates a

closed-loop system that addresses quality issues from on-site detection to root-cause resolution. In 2025 M&G launched a special initiative for full value chain quality improvement covering more than ten key product categories

including writing instruments correction tapes paper notebooks and calculators.R&D and design stage Raw material stage Production and testing stage Retail stage

The Quality Center fully demonstrated the The Supply Chain Management Center The Production Center focused on Jiumu Store implemented targeted

correlation between product user experience implements early-stage mobility improving quality issues arising during corrections for warehouse and quality

and quality metrics and carried out targeted management for 'Three New' products production and testing due to processes issues held dedicated review meetings

improvements with a focus on enhancing involving new materials structures and equipment errors and other factors. We and initiated batch-level improvement

the performance of heat erase products processes. By focusing on structural added visual inspection to a number of projects to address problems such as

to achieve first-class industry standards. A design reviews and mold validation testing devices converting inspected damaged packaging and abnormal fan

total of five internal training sessions related the Center ensures product quality products into image signals for analysis charging effectively safeguarding product

to quality improvement were conducted while institutionalizing exports M&G's via dedicated systems enhancing quality at the point of sale.during the year and the quality defect rate standardized quality management detection accuracy and minimizing false

decreased by 81% compared with the same systems to empower suppliers.. positives.period last year.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 24

Case Intelligent Equipment Introduced to Strengthen Quality Control

M&G attaches great importance to quality inspection and continues to enhance its quality inspection capability and precision. Our in-house

testing laboratory had been accredited by the China National Accreditation Service for Conformity Assessment (CNAS) providing quality

inspection capabilities aligned with international standards. In 2025 M&G gradually deployed and applied 12 intelligent inspection devices

shifting from traditional offline sampling inspection to online real-time quality control in the production process. These new devices enable

functional and visual inspections including component lifespan testing paper printing quality checks tip quality assessment full inspection

of finished pens cap labeling verification and labeler testing effectively addressing the "missed quality checks" common in traditional manual

inspection significantly improving inspection efficiency while ensuring the superior quality of every product leaving the plant.M&G Product Quality and Safety Training for Management Trainee

Supplier Quality Empowerment Chemical Safety Management

To extend product quality and safety control to the source we implement a quality empowerment program for M&G has formulated and implemented the Chemical Management Policy based on national standards and

suppliers. We assign a technical empowerment expert team to work on-site with suppliers. By providing suppliers industry regulations. This policy clearly defines regulations regarding chemical management principles the

with standard documents we unify and align testing standards and strengthen the precision and stability of prohibition and phase-out of certain chemicals safety standards and certification requirements product

production process control through process optimization shifting quality management from post-production audits and supplier chemical management. The policy is managed by the Company's Chemical Management

inspection to preventive process control and improving suppliers' self-inspection capabilities. This initiative not Committee ensuring the uniformity and standardization of chemical usage management and control processes

only significantly improves the incoming inspection quality rate of key raw materials but also lays a more reliable in products. In line with national standards and industry rules M&G identifies high-concern chemicals subject to

foundation for the quality of finished products achieving both collaborative quality governance and shared limits and builds a chemical control list. At the same time the Company updates this list as regulations change

value across upstream and downstream of the supply chain. During the reporting period through supplier as consumer and market needs evolve and as business and product growth require steadily strengthening

empowerment initiatives the Company worked with suppliers to resolve technical and process issues in multiple chemical control measures.products including staplers with non-rebounding staples and markers with loose packaging clasps.Key Chemical Safety Standards Referenced by M&G

China EU

Inventory of Severely Restricted Toxic Chemicals of China Technical Requirements for Environmental Labeling Products Cultural Registration Evaluation Authorization and Restriction of

Paper (HJ 410-2017) Chemicals (REACH Regulation)

The Regulations of the People's Republic of China on Administration of Student Modeling Clay (T/CSSGA 1006-2018)

Controlled Chemicals - Various Monitored Chemicals List Safety of Toys - Part 3: Migration of Certain Elements (EN71-3)

Request in Common Use of Security for Student's Articles (GB 21027-2020) Book Cover and Slipcase (T/CSSGA 1001-2017) Safety of Toys - Part 9: Organic Chemical Compounds

Requirements (EN71-9)

Gel Ink Ballpoint Pens and Refills (GB/T 37853-2019) Children's Acrylic Paint and Acrylic Markers (T/SLIA 0003-2024)

National Safety Technical Code for Toys8 (GB 6675-2014) Exercise Books (QB/T 1437-2023)

Requirements of Concentration Limits for Certain Restricted Substances in Fountain Pens and Nibs (GB/T 26717-2024)

Electrical and Electronic Products (GB/T 26572-2011)

Hygienic Requirements of Study Products for Myopia Prevention and General Safety Requirements on Food Contact Materials and Articles (GB

Control in Children and Adolescents (GB 40070-2021) 4806.1-2016) and other national food safety standards

8. In accordance with the Safety of toys ( GB 6675-2025 ) series of mandatory national standards officially released on October 1 2025 the Company is actively advancing the transition of its products to ensure that compliance upgrades for products and the supply

chain are completed within the specified timeframe.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 25

Restriction and Phase-Out of Chemicals

M&G identifies substances of high concern that are prohibited or restricted based on national standards and industry regulations and M&G Zero-Boron Antibacterial Ultra-Light

formulates a chemical control list and sets a plan to phase out such substances. Currently all ink used in M&G's writing instruments must Clay: From Technological Breakthrough to

not only comply with applicable product standards and the Request in Common Use of Security for Student's Articles Case (GB 21027-2020) but Setting Industry Standards

should also meet the more stringent EU EN71-3 standard. In addition the control of black gel ink is benchmarked against the restricted

substances list in Appendix XVII of the EU REACH regulation. During the reporting period six types of heat-erasable ink and 12 types of M&G proactively implements self-regulatory controls on potentially harmful

fluorescent ink used in M&G products obtained EU REACH certification. chemicals that exceed national standards. In 2024 M&G independently

In 2020 M&G phased out phthalates from all student products and in 2021 the Company eliminated short-chain chlorinated paraffins from developed a boron-free clay product with an actual boron content of <50mg/

the same product category. The phase-out of both substances has now been fully completed. In the future the Company will continue to kg effectively lowering the risk associated with boron additives. In 2025

implement replacement plans for chemicals gradually replacing chemicals in products that may affect human health or the environment. M&G further launched "Boron-Free Antibacterial Ultra-Light Clay" with an

M&G's subsidiary Beckmann has set stricter chemical rules in line with EU laws has already eliminated phthalates polyvinyl chloride (PVC) actual boron content of <1mg/kg achieving a safety upgrade from "Boron-

per- and polyfluoroalkyl substances (PFAS) bisphenol A (BPA) and other chemicals from its children's products worldwide. free" to "Zero-boron." To drive overall industry progress from the source

the Company led the revision of the Modeling Clay industry standard during

the reporting period advocating for limits on migratory elements (including

boron) free formaldehyde and preservatives. This revision project has been

In 2025 approved for implementation by the Ministry of Industry and Information

Writing instrument inks compliant with EU Technology. Through technology breakthroughs and standard leadership

REACH regulation the Company continues to raise safety benchmarks and guide the industry

toward sustainable development.Heat-erasable gel ink Fluorescent ink

612

Ink REACH Certification M&G Zero-Boron Antibacterial Ultra-Light ClayForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 26

R&D of Healthy and Safe Products

In 2025 M&G adopted a full life cycle management framework to implement systematic controls spanning raw materials user experience and packaging materials thereby establishing a strong and trusted product safety defense.Expanding the Food-Grade Product Portfolio Focusing on the Long-Term Health Impacts of Use Safety and Health of Packaging Materials

Food-grade pigments and raw materials are used across To safeguard eyesight eye-safe student printer paper has The Company has adopted a policy that favors safe

many product groups including outline pens markers been launched. Made from natural unbleached pulp and materials in packaging parts such as blister packs and

watercolor pens oil paint sticks and crayons. During the free of optical brighteners it cuts screen strain during use. bases and is actively developing and adopting safer more

reporting period the Company launched the M&G Safe environmentally friendly options such as EVA-material

Crayons of MG Kids collection developed for children aged drawstring bags and recyclable paper boxes to ensure that

3 to 4. Made with carefully selected natural beeswax the products are safe inside and out.

crayons are pure and free of talc and asbestos; they have

passed the EU EN71-3 standard and skin-sensitivity tests

offering enhanced safety.M&G Safe Crayons of MG Kids Collection M&G Eye-Comfort Copy Paper for Students M&G Easy-Erase Colored Whiteboard Pen Packaging has shifted

from PVC to Paper Boxes.Raising Awareness of Chemical Safety

M&G is committed to enhancing the transparency of product chemical safety. For all chemical substances procured the Company requires suppliers to provide Safety Data Sheets (SDS) of chemicals and respond to relevant

information requests from regulatory agencies customers and other stakeholders. Products promoted with health and safety as selling points are subject to strict inspection and must pass required testing and obtain relevant

certifications before being launched to the market. Certification information must be disclosed as required and false advertising is strictly prohibited. At the same time M&G actively promotes chemical safety knowledge among

consumers using live-streaming e-commerce platforms and other channels to educate the public on the chemical content of products encouraging consumers to pay greater attention to chemical safety.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 27

Marketing and After-Sales

Adhering to the principles of "transparent communication and responsible delivery" M&G integrates sustainable concepts into every part of its brand communication customer service and consumer relations. By sharing accurate

information M&G aims to guide consumers toward eco-friendly choices; with a strong after-sales system and quick-response plans the Company protects consumer rights and improves the product-use and after-sales experience.Responsible Marketing and Communication

M&G strictly complies with the Advertisement Law of M&G published the M&G Social Media Platform Content M&G has also formulated the M&G Media Relations

the People's Republic of China the Copyright Law of the Guidelines to regulate content on self-media platforms Guidelines and the M&G Public Opinion Management

People's Republic of China and other relevant laws and requiring that "all content published on social media System which clearly state that M&G employees are required

regulations. We have issued institutional documents such as platforms shall be truthful legitimate healthy and to communicate with the media and other influential

the Promotion Compliance Guidelines and the Product Draft accurate and must not contain false or misleading audiences based on facts maintaining an honest clear and

Review White Paper to ensure that advertising is legal and information or deceive or mislead consumers." transparent attitude while actively practicing responsible

compliant sales information is transparent and accurate and marketing.legitimate consumer rights and interests are protected.The Company's Brand Department is responsible for executing and driving brand decisions as well as planning managing and executing daily brand affairs; brand building is carried out in collaboration with various company

departments and the marketing departments of branches nationwide. In terms of operational mechanisms the Brand Department has developed the M&G Stationery Visual Guidelines Manual to ensure clear brand perception by

maintaining consistent visual expressions and to provide accurate information to consumers; the Leagl Affairs Department regularly reviews key promotional and marketing points and conducts relevant internal training to ensure

the accuracy and authenticity of product marketing information.M&G E-commerce Marketing Management Mechanism

The Company has established and strictly enforces a "Three-Review Three-Verification" marketing compliance mechanism to ensure that content on social media and e-commerce platforms undergoes a comprehensive review

before publication.Omnichannel Control Three-Review Three-Verification Process Protecting Consumer Rights

For e-commerce product detail pages live streams and short- Focusing on product function and material descriptions Through our "Three-Review Three-Verification Process" we

form video content the team conducts pre-publication word-by- the e-commerce platform department the relevant product eliminate false and misleading advertising. While safeguarding

word and full-screen reviews to ensure strict compliance with the department and the Leagl Affairs Department conduct rigorous our brand's reputation we ensure that consumers receive

Advertising Law of the People's Republic of China and platform reviews to verify the original data assess legal risks and ensure truthful and accurate information thereby effectively protecting

rules. brand consistency on a case-by-case basis. their right to know.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 28

Customer Satisfaction and After-Sales Service

Customer Satisfaction Survey Customer Complaint Handling

M&G actively listens to customer and consumer feedback viewing customer satisfaction as the core metric The Company continues to streamline its consumer complaint handling mechanism establishing a multi-channel

for measuring brand health and service quality. To this end the Company has established a routine user customer complaint response team and a grid-based management system for quality business partners. During

communication and feedback monitoring mechanism to gather authentic insights from consumers and partners the reporting period the Quality Center improved the grid-based management mechanism to proactively collect

across multiple channels including channel partners e-commerce platforms and corporate clients. Additionally customer feedback analyze common after-sales issues and establish a regular follow-up mechanism driving a

by conducting regular specialized surveys covering product functionality user experience after-sales response 32.7% decrease in the monthly average number of customer complaints; simultaneously establishing a "resolution

and brand recognition the Company ensures the comprehensiveness and objectivity of its evaluation results. follow-up and improvement" three-cycle management cycle for customer complaints reducing the average

During the reporting period the Company conducted an omnichannel customer satisfaction survey and achieved complaint resolution time by 37.5%. Additionally in accordance with the Measures for the Recall of Defective

an overall satisfaction score of 90.9 points. Products the Company established a quick response procedure with the Sales Center leading the execution of

recalls to ensure immediate response full traceability and proper disposal of defective products thereby effectively

safeguarding consumers' legitimate rights and interests.M&G's "Three-cycle Management Cycle" Customer Complaint Management Process

Average Customer Complaint Resolution Time

Unit: days

Handling Cycle Accountability & Recovery Cycle

Disposition Plan Recovery from Responsible

16

Entities

Customer Feedback Complaints Collection & Liability Rapid

Determination Compensation Improvement Cycle 8

5

Define Standards for Rapid Compensation Problem

Rectification Improvement Verification

202320242025

Progress in Establishing Customer Complaint Feedback Mechanisms Across Various Channels

Channel Partners Large Retail Stores E-commerce Channels Corporate Procurement Platform

An after-sales issue feedback Jiumu Store established a M&G formulated the Customer Complaint Handling During the reporting period Colipu Group developed a unified

and resolution process involving comprehensive complaint Standards and other management documents to online after-sales request portal enabling sales personnel to

"channel partners and quality handling process standardizing standardize the full process management of customer access and submit customer after-sales requests in real time

specialists" has been set up and the handling procedures and complaints in e-commerce sales channels. The with a single click thereby reducing the average after-sales

a grid-based management system statistical analysis for customer Company clarified the division of responsibilities for request processing cycle by more than 50%; The Company

further enables quick response complaints across online pre-sales in-sales and after-sales functions and a implemented an "omnichannel consolidation and standardized

to after-sales issues. During the and offline channels and dedicated after-sales work order team was formed to processing" mechanism for after-sales work orders unifying the

reporting period 85% of after-sales formulated rules for complaint shorten the waiting time for online consumers' after- entry point for work order registration and processing standards.issues were resolved within 7days. escalation. For products with high sales issue resolution. A monthly complaint data By clarifying key points of customer complaint information and

complaint rates on-site quality analysis dashboard is produced and the results are handling procedures the mechanism addressed issues such as

improvements are regularly used for subsequent complaint collection review the loss distortion and misinterpretation of critical information

conducted at suppliers to reduce and investigation and optimization work thereby during the workflow enabling real-time tracking and dynamic

complaint rates. developing more targeted measures to improve management of the progress of every customer complaint.complaint service quality.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 29

Climate and

Environment

Against the backdrop of global efforts to address climate

change and to promote green transformation M&G

Stationery has integrated ecological and environmental

protection into its corporate development strategy.Building on environmental compliance and pollution

prevention the Company is systematically advancing

its carbon-reduction roadmap deepening resource

conservation and recycling and actively practicing

biodiversity conservation. The Company is committed to

continuously reducing its environmental footprint across

operations and the entire value chain while achieving

steady growth thereby helping build a future where

humanity and nature coexist in harmony.Our Goals

By 2030

Using 2021 as the base year to reduce GHG emissions

from our own operations (Scope 1 and Scope 2) by 42%

By 2050

To achieve carbon neutrality across the entire

value chain

Topics addressed in this section

Response to climate change

Environmental compliance and pollution prevention

Waste management

Water resources management

BiodiversityForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 30

Response to Climate Change

In response to severe climate challenges M&G has incorporated climate change-related matters into the overall governance framework and set clear phased targets: using 2021 as the base year to reduce GHG emissions from our

own operations (Scope 1 and Scope 2) by 42% by 2030. To achieve carbon neutrality across the entire value chain by 2050.. Leveraging a carbon reduction pathway spanning R&D production warehousing and logistics we are

steadily enhancing business resilience and actively responding to the national dual carbon goals.Governance Strategy

M&G's sustainability governance framework has integrated climate change-related matters into its overall To assess the impact of climate-related risks and opportunities on the Company's short- medium- and

management framework9. During the reporting period the Company established the "M&G Climate Action long-term strategies M&G conducted a climate scenario analysis in accordance with the SSE Sustainability

Group" comprising the Sustainability Office heads of key energy-consuming business units such as the Report Guidelines and the Ministry of Finance's Climate Disclosure Guidelines. The Company adopted the

Production Center and the Logistics Center and leaders of subsidiaries. The Sustainability Office is responsible Intergovernmental Panel on Climate Change (IPCC) SSP1-2.6 (temperature rise of 1.5° C to 2° C) and the IEA's Net-

for coordinating and advancing the Company's climate strategy regularly monitoring progress toward climate Zero Emissions (NZE) scenario as low-carbon scenarios and the IPCC's SSP5-8.5 (temperature rise of 4° C) as

targets and managing climate-related disclosures. Heads of each business unit collaborate to establish carbon a high-carbon scenario. By comparing trends in physical environmental and socioeconomic conditions under

management systems form cross-departmental working mechanisms and drive the implementation and different temperature rise paths the Company identifies potential climate risks and opportunities facing its core

execution of greenhouse gas reduction measures. Emission reduction targets have been broken down annually business and assesses their potential financial impacts thereby enabling the formulation of more effective and

and incorporated into the annual performance evaluations of heads at each facility and business unit ensuring targeted response strategies. Because of limitations in current data precision and model certainty this year's

routine tracking and completion of the management cycle. scenario analysis primarily used qualitative methods employing narrative-based scenarios to assess business

and strategic resilience. In the future the Company will continue to improve the integration of GHG emission data

with financial metrics and gradually introduce quantitative tools such as stress testing to more accurately assess

climate-related financial impacts.

9. For more information on the integration of M&G's climate change-related matters into the sustainability governance framework please refer to the "Sustainable Development Management - Sustainable Development Governance" section.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 31

Climate-Related Risks Opportunities and Financial Impacts

Climate-Related Risks and Potential Financial Impacts

Risk Type Impacts Timeframe Affected Value Chain Processes Potential Financial Impacts Response Measures

* Extreme weather events such as high temperatures * Conduct regular inspections and upgrades of facilities

typhoons and heavy rainfall may cause damage to and equipment stability to improve resilience against

facilities and equipment disrupt logistics and affect natural disasters;

the supply of raw materials. Thereby enabling timely

Short medium Upstream of the Value Chain deliveries that avoid penalty payments and control

* Map climate risks across the supply chain and diversify

Acute Risk supplier locations;

and long term Company Operations costs;

* Extreme weather events such as heatwaves and * Develop disaster emergency response plans conduct

thunderstorms may endanger employee health and emergency drills purchase accident insurance and

safety leading to production pauses or higher labor maintain daily reserves of disaster prevention and

costs. relief supplies.* Rising sea levels may lead to greater operational

* Gradually incorporate climate risk considerations

instability and increased costs for the Company's

into infrastructure development and future business

facilities located in coastal areas;

planning;

* Increased ecosystem vulnerability may affect the stable

Chronic Medium and Upstream of the Value Chain * Strengthen prevention and control of forest-related

supply of raw materials in M&G's supply chain such as

Risks long term Company Operations risks such as fire wind damage and pest outbreaks;

timber and pulp leading to higher procurement costs;

deepen sustainable forest land management;

* The likelihood of virus transmission and outbreaks

* Improve employee health and safety benefits

may increase potentially impacting employee health

including insurance coverage.and safety raising labor costs.* Monitor and stay informed about national climate

* With the continued advancement of the Dual Carbon policy developments and incorporate policy

policy enterprises will face stricter regulations on requirements into operational planning in a timely

energy conservation and carbon reduction. M&G manner;

may need to intensify emission reduction efforts and

increase financial investment; * Continuously enhance carbon management

Company Operations capabilities promote energy structure transformation

Policy and * Companies included in the Emissions Trading Scheme

Medium term Downstream of the Value and implement energy-saving technological upgrades;

Legal Risks (ETS) are required to fulfill their carbon allowance

Chain

settlement responsibilities. Rising carbon prices will * Calculate product carbon footprints to proactively

lead to increased compliance costs; meet potential compliance requirements and identify

processes with high carbon emissions;

* International green trade rules such as the EU Carbon

Border Adjustment Mechanism (CBAM) will increase * Strengthen carbon management across the supply

export costs. chain and implement green procurement to drive

emission reductions throughout the value chain.Physical Risk Transition RisksForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 32

Risk Type Impacts Timeframe Affected Value Chain

Processes Potential Financial Impact Response Measures

* Stricter future carbon reduction policies will require * Actively identify carbon reduction potential

continuously increasing R&D investment in energy- implement energy-saving and emission-reducing

Technology Short and medi- Company Operations Down- saving and emission-reducing technologies. Failure projects and continue to increase the share of

Risks um term stream of the Value Chain to adopt green low-carbon technologies in time may renewable energy usage;

weaken market competitiveness and lead to revenue

* Promote digitalization and intelligent technologies

decline.to improve energy efficiency.* The phase out of petrochemical feedstocks is expected * Developing green low-carbon new materials

Upstream of the Value Chain

Market Risks Medium term to lift prices for raw materials such as plastics thereby and applying them to the development of more

Company Operations

raising operational costs. sustainable products.* Increasing attention from media professional

* Implement carbon reduction measures and ensure

organizations and industry associations on corporate

Reputation Risks Short and medium Corporate Operations that related communication and promotional

ESG performance may result in reputational damage

term content is objective accurate and traceable.and revenue loss if related expectations are not met.Climate-Related Opportunities and Potential Financial Impacts

Opportunity Type Impacts Timeframe Affected Value Chain Processes Potential Financial Impacts Response Measures

* Identify energy-saving potential and continuously

* Improvements in energy and carbon emissions improve energy efficiency;

management can promote energy conservation and

Resource Efficiency Short term Company Operations

emission reduction while also reducing costs and * Actively promote green logistics and green office

enhancing efficiency. practices to strengthen energy conservation and

emission reduction across all operational stages.* Early deployment of renewable energy can reduce * Expand the use of renewable energy and optimize the

Energy Sources Medium and long term Company Operations

future dependence on fossil fuels. energy mix.Company Operations * As consumer awareness of green and low-carbon

Short medium * Increase investment in the R&D and promotion of

Products and Services Downstream of the practices increases and green procurement becomes

and long term sustainable products;

Value Chain a growing trend among government and corporate

entities the market demand for high-quality * Guide product development by adopting sustainable

sustainable products will continue to rise. Developing design principles;

Company Operations green and low-carbon products will help the Company

Market Medium and long term Downstream of the * Communicate the concept of sustainability to further enhance its competitiveness and increase

Value Chain consumers and engage them in joint climate action.revenue.Transition RisksForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 33

Climate Strategy and Action Plan

To address the aforementioned climate-related financial risks and opportunities M&G has formulated a comprehensive emissions reduction strategy and action plan covering the entire process – including manufacturing

warehousing and logistics office operations eco-friendly stores supply chain management and product waste management – aimed at enhancing the Company's strategic resilience and striving to achieve carbon neutrality.M&G Carbon Emission Reduction Strategy and Action Roadmap

2021-20302030-2050

Target Target

Using 2021 as the base year to reduce GHG emissions from our own operations (Scope 1 and Scope 2) by 42% by 2030. To achieve carbon neutrality across the

entire value chain by 2050.Action Action

Scope 1 and Scope 2 Scope 3 * Conduct regular carbon management;

* Continue expanding renewable energy

Manufacturing Supply Chain Management use;

* Explore energy-saving potential optimize energy * Establish a carbon emissions accounting system for the * Introduce innovative low-carbon

management and improve energy efficiency; supply chain; technologies processes and

management models;

* Increase the proportion of renewable energy and * Encourage suppliers to set energy-saving and emission

gradually transition to clean energy. reduction targets and regularly track progress; * Explore additional carbon reduction

* Gradually conduct product carbon footprint accounting opportunities such as carbon credits.Warehousing and Logistics

and management;

* Optimize logistics routes and improve transportation * Empower suppliers to enhance carbon management and

efficiency; supply capabilities for green products.* Use new energy transportation vehicles;

* Enhance warehouse intelligence and improve energy Product End-of-Life Management

efficiency in storage facilities. * Explore recycling remanufacturing and reuse of materials

and products;

Office Operations & Green Stores

* Promote sustainable product design to improve the

* Optimize lighting and heating ventilation and air recyclability of products and packaging.conditioning systems;

* Promote low-carbon office and lifestyle concepts.

2021

Base Year

2030 2050Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 34

Risk management

M&G integrates the identification assessment and management of climate-related risks and opportunities into the Company's overall risk management system to methodically manage climate risks.M&G Climate Risk Identification and Assessment Process

Climate Risk Identification Climate Risk Assessment Climate Risk Response

The Sustainability Office compiles a The Risk Management and Compliance Committee evaluates business risks climate risks and other ESG- Climate risks identified as high priority are

climate risk list based on domestic related risks through qualitative and quantitative analysis from short medium and long term perspectives assigned to responsible departments to

and international policy trends and prioritizes them and submits the results to the Board Strategy Committee for review; develop and implement mitigation plans.stakeholder feedback;

Metrics and Targets

Strategic Pillars Goals Progress in 2025

Using 2021 as the base year to reduce GHG emissions from our own operations (Scope 1 The Group's Scope 1 and Scope 2 GHG emissions reduced 36% reduction

and Scope 2) by 42% by 2030. compared to 2021.Response to climate

change10 Collected carbon data from 80% suppliers establishing an initial supplier

To achieve carbon neutrality across the entire value chain by 2050.carbon data management system.M&G continues to calculate and disclose Scope 1 and Scope 2 GHG emissions at the organizational level on an annual basis. The accounting follows standards and specifications such as ISO 14064-1:2018 Specification with Guidance

at the Organization Level for Quantification and Reporting of Greenhouse Gas Emissions and Removals GB/T 32150-2015 General Guideline of the Greenhouse Gas Emissions Accounting and Reporting for Industrial Enterprises and

complied with the 2019 Refinement to the 2006 IPCC Guidelines for National Greenhouse Gas Inventories with the organizational boundary defined based on the operational control approach. During the reporting period the scope

of the calculation covered the M&G Shanghai base the Shanghai Headquarters Office Building the South China base the North China base Axus Stationery Colipu Group and Jiumu Store (directly operated stores) and the Central

China base which is newly constructed and put into operation in 2025 has been included in the scope.Building on this foundation the Company is steadily advancing its efforts to track Scope 3 emissions and continuously improving the management of GHG emission data across its value chain. This year we have initiated the

accounting of Scope 3 greenhouse gas emissions for certain categories collected GHG emission data from 80% of our suppliers and calculated the carbon footprints for 11 products.

10. Scope 2 GHG emissions reduction targets are set using a market-based accounting method.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 35

Notes on Data Corrections and Changes in Accounting Methods

M&G GHG Emissions Data

Data correction

Total GHG Emissions (Scope 1 and 2)

Unit: tCO2e

This year we re-verified the thermal energy content (enthalpy value) of steam. Given that steam was added

as a new energy category starting in 2024 the corresponding energy consumption and GHG emissions data

91357

for 2024 have been adjusted in this Report to ensure the accuracy of historical records.

62720

58546

4883848055

Change in accounting method

This year the accounting method for purchased electricity data for the directly operated stores of Jiumu

Store was updated from a sampling-based estimate to a survey-based estimate using actual electricity

bills providing a more accurate reflection of actual consumption. As this change cannot be applied

retroactively to prior years the disclosed purchased electricity data for 2025 and the corresponding Scope

2 GHG emissions data in this Report are not fully comparable to historical data.

20212022202320242025

While advancing emissions reductions we also focus closely on carbon emissions compliance and fulfillment as well as carbon asset management. Since its inclusion in the Shanghai Carbon Emissions Trading System in 2016

M&G's Shanghai base has strictly complied with all obligations by completing annual settlements in full and continuously optimizing overall compliance costs through the effective rollover of surplus allowances. During the reporting

period we completed the 2024 annual settlement and the 2025 settlement will proceed on schedule. Over the past five years the Company has consistently maintained compliant operations with no penalties associated with

carbon emissions settlements.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 36

Climate Action

To systematically advance the implementation of our climate strategy we have broken down our emission reduction targets level by level into core areas

including energy management low-carbon logistics and green operations and established a comprehensive management system covering the entire

process. Through quantitative management and regular tracking we ensure a clear carbon emissions reduction pathway and effective implementation.Energy Management

M&G strictly complies with laws and regulations such as the Law of the People's Republic of China on Energy Conservation and the Administrative Measures

for Energy Conservation of Key Energy Consumers Units has established an energy management system coordinated and integrated by the Climate Action

Task Force and implemented by major energy-consuming departments such as the Production Center and has obtained the ISO 50001 Energy Management

System certification. The Company has developed and implemented the M&G Energy Management Manual and each base has been developing annual

energy conservation targets based on the Group's climate strategy and action roadmap and in light of actual conditions and actively implementing energy

conservation measures such as equipment upgrading and retrofitting process optimization waste heat recovery and digital management. While ensuring

a stable energy supply we are gradually increasing our share of clean energy through expanded investment in solar power generation and green electricity

procurement. Our Shanghai base has been included in the list of National Green Factories since 2024 and successfully passed its recertification during the

reporting period. In 2025 our subsidiary Axus Stationery was awarded the Shanghai Three-Star Green Factory Certification. M&G ISO 50001 Energy Management

System Certification

M&G Energy Consumption Data

Renewable Energy Consumption Total Energy Consumption Total Energy Consumption Intensity

Unit: 10000 kWh Unit: tce Unit: tce/RMB10000 revenue

320518876182000.0080.008

0.0070.007

14880

13612138740.006

2160

1322

875911

2021 2022 2023 2024 2025 2021 2022 2023 2024 2025 2021 2022 2023 2024 2025Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 37

M&G Energy Conservation and Carbon Reduction Initiatives

Energy-Saving Technical Retrofit Measures

Air compressor energy efficiency optimization Injection molding workshop upgrades Diesel-to-electric conversion and efficiency upgrades

We have been upgrading and retrofitting air compressors Following the energy-saving retrofit of 31 injection molding In 2025 Axus Stationery's Shanghai plant launched an "Diesel-to-

and air compressor stations since 2024. During the reporting machines and the reduction of molding cycle times in 2024 we electric" initiative replacing diesel forklifts with electric models to

period we continued to upgrade centrifugal air compressors continued equipment replacement and process optimization reduce fossil fuel use. At the same time the heating system of the pencil

to centrifugal air compressors improving equipment efficiency in the injection molding workflow during the reporting period. paint-drying ovens was upgraded significantly reducing both drying

and achieving annual electricity savings of approximately The new water pump in the workshop consumes 30 kW less time and equipment energy consumption.

500000 kWh. than the previous equipment.

Clean Energy Consumption

Photovoltaic project development Purchased green electricity

M&G continues to advance the deployment of distributed photovoltaic systems with all bases actively carrying out photovoltaic The Company continues to increase its share of renewable energy

construction and capacity expansion. In 2025 the South China Base's 3.5 MW photovoltaic system was officially connected to the grid the through the purchase of green electricity. In 2025 purchased green

Central China Base commenced its photovoltaic project expected to generate 4 million kWh annually and Axus Stationery's Shanghai electricity totaled 7.44 million kWh.plant expanded its photovoltaic capacity to 2.9 MW. Benefiting from the continuous expansion of installed photovoltaic capacity during

the reporting period the Company's photovoltaic power consumption increased by 11% year on year and renewable energy accounted

for 21% of total electricity consumption.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 38

Case Raw Material Improvements Achieve Energy Conservation and Consumption Reduction

To implement its climate strategy objectives M&G actively explores energy conservation and consumption reduction through raw material and process improvements. During the reporting period after extensive

comparisons and experiments we found that using high-melt-index novel materials such as PP/PBT ceramic-like polymers PLA biodegradable materials and plant residue-based materials can significantly optimize melt

temperature control before injection and melt flow performance after injection while ensuring that product appearance and tactile quality meet standard requirements. After implementing the material substitutions the

melt temperature of raw materials in the production process can be reduced by 15° C to 25° C effectively shortening melting time and reducing energy consumption during production. These material innovations have

improved processing efficiency and optimized production energy use providing technological support for the Company's low-carbon manufacturing and sustainable development goals.Case M&G Central China Base: Low-Carbon Design and Intelligent Operations

M&G's Central China base was officially completed and put into

operation in July 2025. The project has integrated green concepts

and intelligent technologies since the planning stage aiming to build

an operational benchmark that emphasizes both efficiency and

environmental protection.* Green infrastructure: High-energy-efficiency air-conditioning

systems and energy-saving designs are adopted to reduce

baseline energy consumption and variable-frequency water

source heat pumps and air-cooled units are used to achieve

variable-frequency coverage of core power systems.* Intelligent integration: Automated hardware is deployed

and fully integrated with the Warehouse Management System

(WMS) Warehouse Control System (WCS) and Robot Control

System (RCS) to achieve digital warehouse scheduling while

air compressor units are scientifically matched and controlled

through variable-frequency intelligent systems to allow

equipment loads to be closely aligned with production demand

and eliminate no-load energy losses.* Energy efficiency optimization: Storage density is increased

through "vertical space optimization" reducing the need for

warehouse floor area. Modular zoning is implemented for

cooling towers so that the heat dissipation system can be

operated on a "demand-driven" basis according to real-time

process water temperature feedback to maximize energy

efficiency. Equipment operation is dynamically planned

Rooftop Photovoltaic System at M&G's Central China Base

through "intelligent scheduling optimization" thus minimizing

idle and standby energy consumption.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 39

Low-Carbon Logistics

M&G continues to strengthen energy-saving initiatives in logistics and warehousing. Leveraging digital technologies and upgrading equipment we have achieved high efficiency and low energy consumption in materials

transportation and warehouse management.New energy vehicle replacement

In-warehouse operations at our Logistics Center have achieved 100% coverage of electric forklifts. In the future we will gradually replace trucks with renewable energy models to further reduce carbon

emissions during transportation.Digital vehicle scheduling

Through M&G's Transportation Management System (TMS) we have achieved real-time monitoring of self-operated vehicles' transport status and location so as to plan optimal routing and minimize

empty return trips.Intelligent warehouse management

Rail guided vehicles (RGV) have been upgraded an energy-saving mode has been added and automated logistics equipment has been configured with non-operational standby states to reduce energy

consumption during idle hours. During the reporting period we saved nearly 90000 kWh of electricity.Green Operations

We integrate low-carbon principles into our daily operations. Through digital empowerment and action advocacy we reduce energy and resource waste in our operations thereby reducing carbon emissions.Paperless office

We actively promote paperless office practices. Except for hard-copy documents that must be printed we encourage employees to use electronic documents at work. During the reporting period we

achieved paperless financial reimbursement eliminating 87% of paper vouchers. This not only significantly reduced paper consumption but also minimized the time employees spent printing organizing

affixing and submitting documents while improving accounting efficiency.Energy conservation in buildings and stores

The "Lunch Break One-Hour Lights-Out" initiative has been implemented in our Shanghai office building LED energy-efficient lighting is promoted for use during store renovations and some

channel partners are encouraged to turn off air conditioning one hour before closing to reduce electricity consumption without affecting normal work operations.Procurement of low-carbon office supplies

We prioritize procuring office supplies with low carbon footprints. During the reporting period all printer paper purchased was PEFC/CFCC-certified.Promotion of low-carbon philosophy

Energy-saving signs are posted on the switches in public areas employees are encouraged to turn off office equipment during idle hours and low-carbon advocacy activities such as stair-climbing check-ins

are regularly conducted to enhance employees' energy conservation awareness.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 40

Environmental Compliance and Pollution Prevention

M&G regards environmental compliance as a core standard and is committed to establishing comprehensive environmental compliance management integrating the concepts of "pollution prevention" and "source control" into

operational management.Environmental Compliance Management Pollutant Emission Management

M&G strictly complies with the Environmental Protection Law of the People's Republic of China the Law of In the planning and construction stage of the base the Company strictly adheres to the Environmental Impact

the People's Republic of China on Environmental Impact Appraisal and other relevant laws and regulations. Assessment System and the "Three Simultaneities" principle implements 100% environmental assessment and

The Company has established environmental management systems including the Environmental and Safety construction of environmental protection facilities and minimizes environmental impact during the construction

Management Operation Control Procedures and the Environmental Factor Identification and Control Procedures . period through scientific planning. In the manufacturing and operating phase the Company has established a

Additionally to address environmental emergencies the Company has established the Control Procedures pollutant emission control system covering monitoring recording reporting and emergency response and has

for Emergency Preparedness and Response . It regularly conducts inspections to identify environmental and systematically implemented pollutant emission management through regular testing of wastewater exhaust

safety hazards develops emergency preparedness and response plans for identified risks and implements risk gas and noise and implementation of relevant management systems so as to achieve stable and standardized

assessments for environmental incidents and emergency management protocols for sudden environmental emissions.events. Both M&G Headquarters and Colipu Group have obtained ISO 14001 certification for their Environmental

The Company has fully implemented the pollutant discharge permit system. All M&G sites have completed

Management Systems. During the reporting period the Company did not experience any significant

pollutant discharge registration in accordance with the law and the Axus Stationery Shanghai plant and Siyang

environmental incidents nor was it subject to any major administrative penalties from the Ministry of Ecology

plant have obtained pollutant discharge permits in accordance with the law and submitted implementation

and Environment or other relevant departments or held criminally liable as a result of such incidents.reports on time. During the reporting period all M&G sites and subsidiaries achieved 100% compliance with

emissions standards and continued to carry out pollutant treatment and improvement projects. Among these

Axus Stationery added two-stage activated carbon adsorption units for exhaust gas effectively reducing VOCs

emissions.M&G's Pollutant Emission Control Measures

Exhaust Gas Pollutant Treatment Wastewater Treatment Noise Control

Installed complete dust and odor removal systems for equipment Formulated the M&G Stationery Water Treatment Facility Operation Set up cushioning rubber pads and soundproof covers reduce the

involving exhaust gas and adopted measures such as adding Manual and strictly followed its procedures to ensure compliant running speed of pneumatic stations use sound-absorbing covers

desulfurization and denitrification systems using low-nitrogen discharge into municipal sewage pipelines. silent fans and other measures to control noise problems from

burners and replacing biomass boilers with centralized heating to multiple angles such as physical isolation mechanical pressure

eliminate or reduce negative environmental impacts as much as reduction and equipment upgrading.possible.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 41

Waste Management

M&G strictly complies with the Law of the People's Republic of China on Prevention and Control of Environmental Pollution by Solid Waste and other relevant laws and regulations. The Company has developed systems and

management procedures such as the Solid Waste Control Plan and the Hazardous Waste Storage Facility Management System assigning clear responsibilities across departments for the classification and compliant disposal of

waste.The Company follows the principles of "reduction reuse and recycling" to maximize resource utilization and minimize waste at the source. Recyclable waste is promptly handed over to recycling companies for recycling and reuse;

non-recyclable waste and domestic garbage are collected and processed by qualified service providers; hazardous waste is entrusted to licensed third-party companies for compliant disposal.Waste Recycling

With waste reduction at its core M&G has implemented resource recycling initiatives including recycled packaging prop recycling and promoting bring-

your-own cups. During the reporting period M&G's Shanghai office building was awarded the title of "Waste-Free Building" in Shanghai's Songjiang Folding crates can reuse The Company reused cartons

District for its outstanding resource utilization and waste reduction at source. The Company has established an internal recycling management system cumulatively

to maximize the recycling of wooden packaging e-commerce cartons and production wastes used between factories. During the reporting period the

Company promoted the "100 times reusable folding crates" to replace disposable cartons which were used in the distribution of Jiumu Store; and

carried out a pilot project for the integration of inventory between channels and headquarters to reduce GHG emissions and packaging consumption

in the secondary transportation link; at the same time set up carton dismantling and recycling points in the logistics link of each base to realize the 100 times 2.25 million

direct reuse of complete cartons significantly reducing the number of brand-new cartons and the amount of waste. At the same time we set up carton

dismantling and recycling points along the logistics chain at each base to enable direct reuse of complete cartons and significantly reduce procurement

of brand-new carton packaging.Case Exploring "Cartonless Direct Inbound Warehousing" to Reduce Packaging Waste at the Source

M&G actively explores new pathways to reduce GHG emissions in the supply chain. By promoting the

"Cartonless Direct Inbound Warehousing" model the Company delivers products directly from production

lines to warehouses replacing packaging at the source to reduce waste and resource use. During the

reporting period the Company completed the transition to direct-to-warehouse delivery without cartons for Past

10 product lines and established a dynamic screening mechanism to continuously expand the range of pilot Subsidiary Plant Outer Carton Warehouses Channel Partner

products and categories. Moving forward the Company will focus on promoting standardized coordination Packaging

and deep inventory integration between channel partners and headquarters logistics hubs. By building an

integrated green logistics network it aims to further reduce packaging and enhance resource utilization

efficiency.Present

Subsidiary Plant Warehouses/

Channel Partner

In 2025 the Company completed the transformation o1f 0 products to be directly

warehoused without carton packaging.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 42

Water Resources Management

M&G is committed to water conservation and integrates sustainable water use into its production and operations. The Company continuously monitors indicators such as municipal water intake water recycling and reuse volumes

and wastewater discharge maintaining comprehensive visibility over water usage. There are no reported issues with water resource availability. At the same time the Company actively promotes water recycling and conducts water-

saving upgrades on equipment and infrastructure to continuously improve water efficiency.Upgrading to Water-Saving Appliances

The Company actively promotes water-saving appliances and installs sensor-type water-saving

faucets in the office and production areas to eliminate "running bubbling dripping and leaking" Optimization of Water Use in Board-Making Machines

and the loss of resources caused by human error.The Company has upgraded the cooling system of its PP board-making machines. For the small

volume of non-recycled cooling water a float-activated pump system was installed to enable

water recycling resulting in annual savings of approximately 1200 tons of fresh water.M&G Water Resource Utilization Data

Total Water Use Water Intensity Water Recycled and Reused

Unit: ton Unit: ton/ RMB10000 revenue Unit: ton

5889230.240.2453923

57018549772

4615890.1838851

2023 2024 2025 2023 2024 2025 2023 2024 2025Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 43

Biodiversity

M&G is committed to environmental protection and fostering ecological harmony by protecting the natural environment conserving natural habitats and promoting ecological awareness to minimize the environmental negative

impact of its operations.Compliance and Mitigation

M&G is committed to implementing ecological and environmental protection measures in strict compliance with the Law of the People's Republic of China on Water and Soil Conservation and local rules in its operational areas.During the reporting period all major M&G operational and business sites were located outside the scope of ecological protection redlines and the Company has not been subjected to major administrative penalties or been held

criminally liable for environmental incidents by Ministry of Ecology and Environment and other relevant departments.In 2025 M&G officially released its Commitment to Environment and Sustainable Development 11 aiming at reducing and gradually eliminating the negative impacts of the Company's

operations on ecosystems and biodiversity. Regarding forest and biodiversity conservation the Company commits to:

* Assess the impact of project or construction site selection and development on local biodiversity and protect natural habitats wetlands forests wildlife corridors and

agricultural land;

* Assess biodiversity risks at operational sites and take measures (such as avoidance mitigation restoration and offsetting) to address potential or actual impacts;

* Progressively achieve "No Net Loss" of biodiversity and "No Gross Deforestation" across operations and the value chain;

* Minimize the adverse impacts of operations on forests and biodiversity as much as possible if some impacts on ecosystems still occur the Company will implement

restoration actions in the affected areas.M&G's Ecological and Biodiversity Conservation Measures

Project Site Selection Project Construction Production and Operation

* Conduct on-site inspections to assess the impact of * Carry out environmental impact assessments for construction * Formulate and implement strict management measures

construction on local biodiversity and avoid natural habitats projects to identify key environmental impact factors for wastewater exhaust gas and noise and forest land

wetlands forests wildlife corridors and agricultural land; formulate and implement various environmental protection protection monitor the surrounding environment and

measures and maintain the original ecological state of the reduce environmental impact.* Confirm the project scope and minimize the impact of

plant area;

construction on flora and fauna.* Conduct ecological monitoring of the environment

surrounding the plant as required to understand

environmental changes and potential impacts.

11. M&G's Commitment to the Environment and Sustainable Development has been published on the Company's official website under "Investor Relations – ESG–Reports and Policies."Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 44

As a wood-based pencil manufacturer Axus Stationery

attaches great importance to the sustainable Reforestation Activities Forest Ranger Patrol System

management of forests and the conservation of Carry out reforestation activities in Xinjiang to enhance Establish a team of professional forest rangers to

woodland biodiversity. Its 1853 mu of forest land local ecosystem stability and improve the regional implement regular woodland inspections monitor the

has Forest Stewardship Council (FSC) Certification ecological environment. survival of wildlife assess the impact of operational

for Forest Management (FM) and Chain of Custody activities on the ecological environment and promptly

(CoC) granted by Bureau Veritas. In managing its own identify and deal with potential woodland safety hazards.

forest land Axus Stationery strictly adheres to limited

harvesting requirements to protect large stands of Axus Stationery's

Forest Ecosystem

trees; the Company pledges to use only certified tree Conservation

species continuously monitors forest biodiversity Safety Education and Training for Villagers Initiatives Joint Inspection by Villages and Enterprises

during operations and implements various measures

Provide training on woodland protection and safety Establish a joint inspection mechanism with local

to ensure the sustainable use of forest resources.for villagers around woodlands to raise community communities to jointly protect and manage forest land

awareness of biodiversity conservation. and build a cooperative force for ecological protection.Ecological Protection Awareness

M&G deeply integrates biodiversity protection and sustainable consumption advocacy to convey knowledge of wetland marine and other ecological environmental protection to the public. With the "Endangered Animals" series

of sustainable products as the carrier the Company organizes diversified activities such as parent-child wetland tours wetland ecological virtual reality (VR) experiences marine conservation flash mobs and ocean beach clean-

up operations and donates part of its product sales to public welfare foundations in the field of ecological conservation. On World Environment Day 2025 M&G officially announced its strategic cooperation with the Center for

Environmental Education and Communications of Ministry of Ecology and Environment launched the "Earth Guardian" sustainable action plan and released co-branded gel pens and carbon-neutral notebooks featuring rare

animal-themed designs. By integrating the concept of biodiversity into products and consumption scenarios the Company was selected as one of the 2025 Exemplary Cases of Biodiversity Conservation in Industry and Commerce .Case Jiumu Store Transforms Biodiversity from a Concept into a Tangible Brand Experience

At the beginning of 2024 M&G released the "Endangered Animals: Wetland" series incorporating images of five endangered animals in wetlands such as the Black-faced

Spoonbill and Oriental Stork into the product packaging design thereby initiating the exploration of conveying ecological values from the product side. In 2025 Jiumu

Store further strengthened its offline reach and public advocacy: on May 28th during the "World Otter Day" it launched the topic "There are otters in my city" together with

Ton-Ton Otter. During "World Otter Day" Jiumu Store and OTTERdun launched the topic "Otters in my city" which effectively aroused the attention of urban consumers to

the protection of endangered animals through interactive card playing and badge collecting activities in five stores in Shanghai; in November of the same year Jiumu Store

launched the "Warm Winter Recycling" campaign. In November of the same year the Company launched the "Warm Winter Cycle" program giving endangered animals

storytelling through vivid illustration narratives and opened the "Nature Notebook Workshop" in Shenzhen and Shanghai guiding consumers to record the beauty of nature

in their handwritten notebooks and promoting the awareness of the harmonious coexistence of man and nature.The "Warm Winter Recycling" section at Jiumu StoreForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 45

Shared Prosperity

Across the Value

Chain

Amid the convergence of deep collaboration across the industrial

chain and the wave of digital transformation M&G has regarded

"Shared Prosperity Across the Value Chain" as the core engine

of sustainable development. Centering on four key dimensions

namely technology innovation-driven development sustainable

supply chain management channel partner empowerment and

information security and privacy protection we have established

a collaborative management system covering both upstream and

downstream stakeholders. By integrating R&D resources deepening

partner development and strengthening data defenses we have

built a transparent resilient and mutually growing business

ecosystem. While enhancing risk prevention and control capabilities

across the entire value chain we have injected lasting momentum

into the industry's high-quality development.Our goals

By 2025

To ensure that 100% of key suppliers comply with M&G ESG

guidelines

To integrate ESG requirements into all new supplier

screening and onboarding standards

By 2030

To ensure that ESG assessments and audits cover 80%

of suppliers

Topics addressed in this section

Technological innovation

Supply chain management

Partner development

Information security and privacy protectionForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 46

Technological Innovation

M&G has remained committed to making technological innovation the core driver of our high-quality development and has established a sound R&D management system. At the same time we regard intellectual property as a

key strategic asset and have built a systematic risk management and protection system. Through specific management measures we ensured the effective implementation of technological innovation and intellectual property

protection providing solid support for the Company's long-term high-quality development. Building on our strengthened competitiveness we continued to provide technological empowerment to upstream and downstream

players across the value chain leading the industry's high-quality development through our innovation capabilities.Governance Strategy Opportunity and Risk Management

M&G's technology innovation governance structure is based on the M&G adheres to a consumer-centric innovation strategy and In response to the uncertainties associated with technological innovation

Company's overall governance system12. To ensure the forward-looking comprehensively advances coordinated innovation across products we have established a dynamic risk and opportunity assessment

nature and accuracy of our technology strategy we have established marketing channels and digitalization building long-term competitive mechanism. By combining quantitative assessment with qualitative

a dedicated strategic function department and an external expert barriers with solid technological capabilities. The Company focuses on analysis we accurately identify key risk points and allocate dedicated

advisory mechanism to regularly conduct comprehensive assessments building reserves in material development precision manufacturing resources accordingly ensuring the effectiveness of our innovation

of industry technology iteration trends scientifically demonstrate processes and innovative design concepts to ensure sustained investments and strategic focus. In operational management and control

technology pathways and effectively mitigate the risk of deviation in technological leadership and product iteration capabilities. It aims to we adhere to the principle of "compliance as a prerequisite" integrating

technology roadmaps. At the execution level the Technology Center translate technological advantages into market competitiveness driving intellectual property protection and compliance risk management

takes the lead in overseeing the development and technical validation revenue and profit growth. At the same time we elevate intellectual throughout the entire product life cycle to build a strong defensive

of our new structures new materials and new processes. The Digital property protection to a strategic level effectively preventing the risk of moat for innovation. Meanwhile the Company actively embraces open

Center coordinates and advances the Company's digital innovation and core technology leakage and safeguarding the expected returns on our innovation. Through in-depth collaboration with universities and research

transformation initiatives. The Legal Affairs Department takes the lead in innovation investments. In addition we support business continuity institutes we built an integrated industry-academia-research community

implementing the intellectual property management system covering through digital and intelligent capabilities assist in improving business accelerating the commercialization of scientific and technological

patent and copyright applications intellectual property protection efficiency and accurately capture strategic opportunities in the achievements while diversifying R&D risks.and rights safeguarding among other tasks thereby safeguarding the digitalization process.achievements of technological innovation.

12. For more information on the governance structure of M&G's technological innovation which is based on the Company's overall governance system please refer to the "Sustainable Development Management - Sustainable Development Governance" section.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 47

Management Measures and Performance

R&D Capabilities and Commercialization of Results

M&G continues to consolidate its innovation foundation as a national-level high-tech enterprise. During the reporting period we invested

RMB190 million in technology R&D and product innovation and received honors including the Science and Technology Progress Award

of the CNLIC and the National Advanced Collective in the Light Industry; Axus Stationery received the "Specialized Refined Distinctive

and Innovative (SRDI) SMEs" honor awarded by the Shanghai Municipal Commission of Economy and Informatization.Based on our R&D capabilities and deep insights into consumer needs we continued to achieve technological breakthroughs in

underlying category technologies functional uniqueness and meeting consumers' core needs. In terms of deepening underlying

technologies the Development and Industrial Application of New Environmental-Friendly Materials for Neutral Ballpoint Pens project

led by M&G with participation from Taiyuan Iron and Steel Group as well as the Key Technologies and Industrialization of High-

Performance Environmental-Friendly Ink and R&D and Industrialization of High Specific Surface Area Fiber Materials with Sheath-Core

Structures and Environmental-Friendly Products projects in which M&G participated in joint breakthroughs were selected as advanced M&G Products Have Repeatedly Won the Four Major International Industrial Design Awards

scientific and technological innovation achievements in the light industry under the 14th Five-Year Plan; R&D and Application of TPE

Erasers with High Erasure Rate was selected for the Second Prize of the 2025 Science and Technology Progress Award of the CNLIC. In In 2025

terms of product design and aesthetics M&G products have repeatedly won the world's four major industrial design awards: Germany's

iF Design Award and Red Dot Design Award Japan's Good Design Award and the United States' International Design Excellence Awards Investment in technology R&D Total R&D personnel

(IDEA). In addition we have also received major design awards such as the Golden Pin Design Award and the Red Star Design Award.During the reporting period the Company successfully launched a series of innovative products including the M&G Premium Retractable

Fountain Pen Retractable Soft-Tip Highlighter and the Meeboki Notebook Collection. Multiple products won honors in the "ISOSF China RMB190 million 405

Stationery Industry Innovation Competition" among which the M&G Premium Safety Scissors with Rotating Blade Sheath won the 2025

Germany iF Design Award.Case "Chinese Paper Better for Chinese Characters": Micro-innovation in the Technology of M&G Meeboki Notebook Collection

In response to increasingly refined user needs M&G drove innovation based on consumers' real needs transforming hard-core technologies into perceptible high-quality

experiences. The Company focuses on Chinese-character writing the most basic and core scenario aiming to address consumers' key pain points through targeted technological

innovation. The Meeboki series builds its differentiated product strength across three dimensions: Paper craftsmanship notebook structure and detail design:

* Paper craftsmanship: 80 g/m2 double-speed smooth-glide paper specifically addressing common issues such as fountain pen's ink bleeding and gel pen's ink splattering; ink is less

likely to show through when writing on both sides ensuring clear content and usability of the reverse side of the paper

* Notebook structure: 9 mm line spacing avoiding the problem of Chinese characters being too crowded when writing or overly large blank spaces between lines; 180-degree lay-flat

design delivering "convenient cross-page writing and more comfortable note-taking"

* Detail design: 360° weight reduction using a flexible cover and lightweight materials; thin and rollable without leaving creases while still offering a certain degree of water and dust

resistance

In addition M&G combined technological innovation with emotional value by contracting emerging illustrators to enhance the product's aesthetic design inviting top student

Pu Yixing as the "Good Notebook Traceability Officer" for transparent communication and jointly publishing the White Paper on Notebook Consumption Insights in China with

Southern Weekly strengthening consumers' perception of and trust in M&G's technological innovation from both public and professional perspectives.M&G Meeboki Notebook CollectionForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 48

Intellectual Property Protection

To strengthen the foundation of M&G's tech innovation the Company formally established and implemented an intellectual property management system in 2021 and has

steadily refined its management policies to protect R&D and innovation outcomes. As national standards have evolved the Company has closely tracked industry trends

and updates to the intellectual property management system and has revised 16 management policies including the Intellectual Property Handbook and the Patent

Management Method in line with the revised standard (GB/T 29490-2023). During the reporting period the Company successfully passed the audit against the new standard

and officially obtained the Intellectual Property Compliance Management System Certification. During the reporting period M&G filed 25 invention patent applications and

received 5 grants; the total number of valid patents stands at 1488.M&G invention patent applications Granted patents Total number of valid patents

2551488

M&G Patent Applications and Grants

Cumulative Number of Patent Applications Cumulative Number of Granted Patents

Unit: item Unit: item

32122868

29012625

26122407

M&G Stationery

Intellectual Property Compliance Management System

Certification

202320242025202320242025

To protect the rights and interests of distributors and consumers the Company places great emphasis on the application and protection of patents trademarks and copyrights. The "M&G 晨光 " trademark was recognized as a "Well-

Known Trademark" by the Shanghai High People's Court in 2023 and the " 九木杂物社 " trademark was included in the "Shanghai Key Trademark Protection List" in 2025. In response to intellectual property infringements the

Company promptly files complaints and reports with law enforcement departments including market supervision departments public security departments and customs. During the reporting period M&G cooperated with public

security departments in 68 anti-piracy operations including 57 administrative actions and 11 criminal investigations successfully completing the anti-piracy mission and effectively protecting the Company's intellectual property and

technological achievements.Case Enforcing Rights and Disrupting Illegal Chains

During the reporting period M&G worked with public security authorities and dismantled a group in Chaonan District Shantou City Guangdong Province that made wholesaled and sold fake "M&G" G-5 refills. The

action led to the seizure of 340000 fake G-5 refills and 270000 packaging boxes and to the arrest of more than 10 suspects. This operation delivered an exact strike against the entire "production-wholesale-sales" chain

dismantling the operation severing the supply chain and targeting the source. It encouraged legal conduct purified the market environment and safeguarded the Company's brand reputation and consumer rights.In 2025Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 49

Digital and Intelligent Transformation

M&G actively explores the business opportunities brought by digitalization and intelligent transformation and We proactively embrace the AI+ era making the deep integration of artificial intelligence technologies with

continues to advance the dual-engine drive of "Core Business Digitalization" and "Organizational Collaboration business scenarios a core engine for improving organizational quality and efficiency. During the reporting period

Digitalization." In terms of core business we launched a product life cycle management system integrating we actively promoted innovative internal applications of artificial intelligence technologies and developed

fragmented data across the product development cycle into standardized transferable assets significantly our first digital employee Xiaochen with a human resources knowledge Q&A function. Throughout the year

reducing communication losses from ideation to market launch and improving collaboration efficiency between Xiaochen answered a total of 11424 HR-related questions from employees including leave policies and process

R&D and the supply chain; Colipu Group used digital employees to replace inefficient repetitive tasks. Through inquiries. This improved efficiency in handling basic employee inquiries by 98% and process handling efficiency

robotic process automation (RPA) and an intelligent rules engine we achieved automated processing from by 50% enabling HR services for employees to become more immediate and standardized. Meanwhile to foster

customer order placement to inquiry and quotation enabling automatic matching of customer requirements. In an AI atmosphere of innovation for all employees the Company organized the "Excellence Selection of the

terms of organizational collaboration based on having brought our core business online we further advanced Most Advanced AI Practice Pioneer of M&G" event attracting employees from various center departments to

the automation of production equipment connecting the data chain from the production site to management participate. It collected 37 innovative topics across multiple business scenarios such as data analysis inventory

decision-making. During the reporting period the automated stereoscopic warehouse at the M&G Central China management and information review. Ultimately six outstanding teams and three outstanding individual cases

Base was put into operation. After completion the trunk line throughput capacity is expected to increase by two were selected fully stimulating the innovation vitality of all employees in the field of AI practice.times compared with the original level.M&G's First Digital Employee "Xiaochen" Excellence Selection of the Most Advanced AI Practice Pioneer of M&G

Total HR-related inquiries answered for Employee Basic Inquiry Efficiency Process Handling Efficiency

employees Improved by Improved by Innovation Topics Collected

1142498%50%37

M&G's First Digital Employee "Xiaochen" "Xiaochen" Chat Interface The "Excellence Selection of the Most Advanced AI Practice Pioneer of M&G" EventForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 50

Supply Chain Management

M&G is committed to building a stable secure and green sustainable supply chain. The Company has established and continuously improved its supplier ESG management system and empowers its suppliers continuously

enhancing supply chain sustainability and building a green transparent and resilient value chain ecosystem.Governance Strategy Opportunity and Risk Management

M&G has established a comprehensive supply chain governance Supply chain stability and compliance are the cornerstone of business M&G has established supply chain risk management covering

structure to ensure the compliance and sustainability of supply chain continuity. We identified that the key risk factors faced by the supply "identification-evaluation-integration-monitoring" and has incorporated

management13. The Company has established a cross-functional chain include the increasingly stringent ESG compliance requirements it into the Company's overall risk management system. The Company

collaborative supply chain ESG management structure. The Sustainability for supply chains by global and national governments which may continuously improves its supply chain management system and has

Office coordinates the formulation of supply chain ESG strategic accordingly increase the complexity of supplier management and the formulated a series of policy documents including Supplier Management

objectives improves ESG management policies and coordinates ESG associated input costs as well as in the context of the green transition Method Supplier Code of Conduct 14 New Supplier Onboarding

audits and performance evaluations of key suppliers. The procurement fluctuations in commodity market prices which may bring pressure on Management Method Supplier Evaluation Management Method and

teams across all business lines embedded ESG risk management and our raw material cost control. The combined impact of these factors Supplier Management Control Procedures to implement standardized

control metrics into the overall management process for supplier may pose potential challenges to our operational efficiency and overall end-to-end process management for supplier development evaluation

onboarding evaluation and exit and organized systematic training to profitability. At the same time we also recognized that building a and control. We established a risk management and control model of

enhance the ESG awareness and management capabilities of personnel sustainable supply chain system can significantly enhance customer "onboarding screening dynamic monitoring closed-loop rectification

in core positions continuously improving the level of sustainable supply trust bringing us long-term and stable procurement advantages as well and mechanism-based exit." At the onboarding stage we conduct due

chain management. as opportunities to strengthen our brand reputation. To this end we diligence on suppliers' performance in environmental compliance labor

are committed to establishing an integrated four-in-one supply chain rights and interests and business ethics and require all cooperating

integration strategy of "quality-cost-delivery-sustainability" implementing suppliers to sign the Supplier Code of Conduct . During the monitoring

ESG management covering the entire process from onboarding to exit stage we implement multidimensional tiered and categorized

to mitigate compliance risks and actively promoting the green and management and conduct high-frequency on-site audits and key

low-carbon transition and digital and intelligent empowerment of the monitoring for high-risk suppliers. At the same time through internal

supply chain so as to achieve mutual benefit and win-win outcomes audit oversight and regular risk communication and training we continue

with upstream and downstream partners in the process of advancing a to enhance supply chain compliance awareness and risk resilience.sustainable supply chain.

13. For more information on M&G supply chain governance structure please refer

to the "Sustainable Development Management - Sustainable Development

Governance" section.

14. M&G's Supplier Code of Conduct has been publicly released on the Company's

official website under "Investor Relations - ESG - Reports and Policies."Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 51

Targets Management Initiatives and Performance

Strategic Pillars Goals Progress in 2025

To ensure that 100% of key suppliers comply with M&G ESG guidelines. 100% compliance rate for key suppliers in ESG assessment and remediation.To ensure that ESG assessments and audits cover 80% of suppliers. 97 suppliers participated in M&G's ESG audits achieving 100% Sustainable supply coverage of key suppliers.chain

To integrate ESG requirements into all new supplier screening and onboarding ESG risk audit elements have been added to the system used to rate and

standards since 2025. bring in new suppliers.Supply Chain Management Process

M&G has set up a strong supply chain management system defining a standard supplier management path that spans new supplier onboarding quality monitoring performance evaluation and de-listing. This approach secures

supply chain stability and ensures a safe high-quality supply of products. During the reporting period the Company revised the New Supplier Onboarding Management Method and the comprehensive evaluation form for new

suppliers further clarifying the audit standards and inspection methods used during on-site audits. Additionally ESG-related risk factors are incorporated into the scope of assessment to improve risk management during supplier

access.M&G Supplier Management Process

New Supplier Onboarding Tiered Management Routine Management

All suppliers must sign the Supplier Code of Conduct and pass Suppliers are grouped by product type strategic fit and level Regular training sessions on-site coaching and routine com-

an evaluation across three dimensions – supply capability of cooperation. munication are held; incoming inspections are carried out on

compliance status and audit – before being accepted. every batch of materials and unscheduled on-site spot audits

are conducted at suppliers' premises.Exit or Relist Improvement and Enhancement Performance Evaluation

Taking into account both supplier performance evaluations Based on performance evaluation results suppliers receive In accordance with the Supplier Evaluation Management

and corrective actions the Company will start the supplier support to develop plans to improve scores; initiatives such Method suppliers are evaluated across five key areas: "Quality

exit process when necessary. as regular quality training and deploying technical teams are Cost Delivery ESG and Service." Supplier classifications are

used. adjusted based on the evaluation results.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 52

Key Supplier ESG Assessment

M&G conducts annual ESG assessments and audits of suppliers evaluating their ESG performance across five areas: sustainable procurement environmental protection health and safety labor practices and business ethics. Eight

zero-tolerance items are defined to prevent major ESG risks. The ESG evaluation process consists of five steps: self-assessment questionnaire document review on-site audit rating and corrective actions forming a closed-loop

management system for continuous improvement. During the reporting period 97 suppliers participated in M&G's ESG audits achieving 100% coverage of key suppliers. M&G conducted 36 on-site audits and required suppliers to

rectify any non-compliance issues. The corrective action pass rate reached 100%.M&G's ESG Audit Process for Key Suppliers

Self-Assessment Questionnaire Document Review On-Site Audit Rating Corrective Actions

The ESG self-assessment checklist The Sustainability Office reviews An annual on-site audit plan is Combine ESG self-assessment Based on the lost points from the

is issued to suppliers and after all submitted materials. Depending developed based on the ESG self- scores and on-site audit scores to on-site audit assist the supplier

suppliers complete the self- on the completeness of the assessment results. Suppliers are determine the supplier's annual in formulating a rectification and

assessment based on their actual documentation the Office may audited on-site and scored using the composite ESG score rating. improvement program and track the

ESG management level and submit contact suppliers to request Supplier ESG Assessment Form . progress of corrective actions. After

supporting materials procurement adjustments or clarifications the corrective action is completed

staff conduct an initial audit. and subsequently determine the the Sustainability Office will review

supplier's ESG self-assessment it and determine the supplier's ESG

score. assessment results for the year.Zero-Tolerance Items in M&G ESG Assessments for Suppliers

Operating with-

out environmen- Illegal hazardous Failure to pass fire Employment of Discrimi- Non-compliance with mini-

tal permits waste disposal safety inspections child labor

Forced labor nation mum wage standards Bribery

Integrity in Procurement

In 2025

M&G adheres to the principles and commitments of clean procurement and ensures the fairness and transparency of the supply system by establishing a tight set of constraints and a

closed management cycle of supervision. The Company takes the Supplier Code of Conduct Transparent Procurement & Integrity Convention and Supply Chain System Integrity Risk The signing rate of the Supplier Code

Prevention and Control Management System as key management tools and explicitly prohibits any form of commercial bribery and undue benefit transactions. During the reporting of Conduct for finished goods and

period the Company systematically sorted out the signing status of the Supplier Code of Conduct and promoted the completion of the retroactive signing work achieve 100% signing of raw/auxiliary material suppliers has

the Supplier Code of Conduct by all suppliers of finished products and raw material procurement to ensure that the relevant requirements were effectively conveyed and implemented reached

in place.On the basis of the system guarantee the Company continues to extend its management tentacles. In 2025 the Audit Department further expanded integrity education from

procurement personnel to suppliers and conducted online anti-fraud propaganda targeting 314 suppliers throughout the year. In order to ensure that the system falls into place the 100 %

Company's Audit Department regularly carries out special investigations and internal audits of supply chain fraud every year and relies on the Anti-retaliation for reporting complaints

Management System to closely protect the whistleblower's relevant information and rights and interests; for procurement personnel who violate the relevant integrity system the

Company will be investigated and verified in accordance with the Supply Chain System Integrity Risk Prevention and Control Management System to give sanctions and continue to

optimize the clean and healthy supply ecology.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 53

Supplier Empowerment

Raw and Auxiliary Material Suppliers

M&G empowers suppliers to enhance their capabilities through regular communication experience sharing on-

site guidance the M&G Business System (MBS) and periodic training. During the reporting period for raw material On-site empowerment for Pre-shipment inspection empowerment for

procurement a total of 29 on-site empowerment was carried out while 22 suppliers participated in outbound

inspection empowerment which enhanced the suppliers' ability in production site management and shipment

quality control; for the suppliers of finished products of the key categories a total of 2 quality improvement 29 suppliers 22 suppliers

training camps held for were held to provide professional knowledge training for 42 suppliers. Moreover 9 key

suppliers were provided with multi-stage and all-round empowerment covering 5S management lean production

transformation and innovation capability enhancement. M&G collaborated with suppliers to trace and analyze

the key issues identified in the ESG audit and provided targeted improvement suggestions. With M&G's support Finished Products of the Key Categories

during the reporting period multiple suppliers made tangible improvements in areas such as chemical storage

and use management workplace safety equipment optimization safety signage posting use of renewable Quality improvement Professional knowledge

energy waste management optimization etc. training camps held for training provided for

2 sessions 42 suppliers

M&G Supplier Quality Improvement Training Camps M&G On-site ESG Audits and Training for SuppliersForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 54

Partner Development In 2025

M&G upholds the concept of "Partnership for a Shared Future" and considers its channel network which spans 1200 cities and

nearly 70000 retail stores nationwide a core strategic asset. The Company adheres to benefit sharing and continues to enhance Retail store image upgrades completed Specialized sales zones created

the resilience of the value chain through digitalization and the standardization of the entire chain. Meanwhile through cross-

border integration of multiple resources deepening industry-education integration advancing green transformation and

collaborating with industry partners to build a high-quality sustainable industrial development ecosystem. 45000 outlets 388000 units

Store Operations Support

Through brand extension and capability transfer M&G continuously enhances the effectiveness of product displays and operational quality in retail

stores. Throughout the year the Company completed image upgrades at 45000 retail stores creating 388000 specialized sales zones.Store Image Refresh Category Zone Development

By optimizing store layouts implementing a unified visual Focusing on peak stationery sales seasons such as the back-

identity system (VI) and conducting training on the proper to-school period the team implemented zoned layouts for

use of materials store image upgrades are supported and categories including writing instruments correction tape

sales are boosted. rulers and compasses erasers and paper products. The team

also redesigned and provided implementation support for in-

store themed zones and product display counters to enhance

the consumer shopping experience.Store Display Optimization

Digital tools

M&G is committed to building an end-to-end digital system covering the entire product life cycle. With the goal of achieving 100% online operation of core business systems the Company uses digital tools to deeply integrate the

supply chain with retail outlets driving systematic improvements in channel operational efficiency and responsiveness.The Company continues to refine its proprietary "Jubaopen" To meet end-user needs the team raised the user experience Overseas versions of " JuBaoPen" and " M&G Alliance" were

app providing data support to channel partners across three by adding tools such as automated new product displays successfully launched. By exporting mature digital tools

dimensions: "task tracking (people) category discovery real-time logistics tracking and support for multiple across regions the Company provided systematic support

(products) and business analysis (stores)." During the packaging barcode scanning. At the same time by linking to for overseas sales operations effectively enhancing product

reporting period the Company further enhanced visual food delivery platform interfaces the system lets end-users accessibility and purchasing convenience for global users.management of channel operations through dashboard join with one click and manage inventory across platforms

redesigns and improved store-quality analysis. along with out-of-stock alerts and discount tools which

strongly supported the rapid growth of the on-demand retail

(O2O) business.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 55

Training and Guidance

Through systematic training and on-site support the Company enhances channel partners' operational capabilities. During the reporting period

the Company organized a series of events including marketing conferences spring new product launches elite training camp summits partner

meetings nationwide mobile training sessions for retail elites and the 2026 Spring Schooling Peak Season Empowerment Program. Training content

spanned multiple dimensions including strategic benchmarking new product promotion and refined retail management with a total of 5876 partner

participants. In addition to central training the headquarters team conducts daily and periodic checks to track the growth of retail outlets and partner

platforms. Based on market trends and feedback the team helps channel partners adjust their business plans thereby enhancing overall operational

stability.National Retail Elite Training

Case Retail Empowerment for Direct-Supply Large Stores: Building a Standardized Management Cycle

M&G aims to create a leading retail solution benchmark in the stationery industry by exporting the M&G Space Brand Visual Guidelines 2.0 to key direct supply partners

with scale and influence and by constructing a closed management cycle of retail services that covers "product matrix display standard and marketing drive."

* Precise Product Allocation: The Company has built a core product pool covering five series and over 500 SKUs. Relying on the commodity hierarchical

management model the Company realizes "one product portfolio" precise stocking and automatic replenishment optimizing the partners' inventory structure

and turnover efficiency from the source.* Standard Visual Output: Provide direct supply partners with full case design support from the visual identity system (VI) soft furnishing materials and space

layout. During the reporting period more than 70 sets of in-depth customized design solutions were produced to ensure a high-quality presentation of the

terminal image and brand consistency.* Data-Driven Operational Conversion: Relying on the marketing timeline and diversified interactive games the Company assists its partners in establishing an

all-link consumer reach mechanism. By standardizing business processes and sharing resources the Company's successful operational experience is transformed

into partners' marketing capabilities.G广ua西ng新xi华 Xi书nh店ua阵 B地oo打k造store Store

Development

Case Empowering Clients to Launch Instant Retail Business

Sichuan Paperclip Network Technology Co. Ltd. (hereinafter "Sichuan Paperclip") a core strategic partner of M&G for over 15 years sought to innovate and transform its business model amid market changes in the

traditional office supplies sector. Through multiple in-depth surveys and thematic workshops the M&G project team guided and supported Sichuan Paperclip in entering the new instant retail (O2O) market. During the

start-up phase M&G assisted the client in completing the opening of an online store and standardized product display analyzing sales data to enhance the daily product selection and promotion plan during the operation

period and assisting the client in achieving a 15% increase in instant retail sales through special subsidies and dynamic adjustment of categories during the school season successfully realizing the dual-mode operation of

"offline + online." This transformation created new growth opportunities for the partner and strengthened the partnership within the value chain through practical support.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 56

Industry Collaboration

In 2025

Adhering to the philosophy of mutual development and win-win cooperation M&G actively participates in the work of industry associations including the China Stationery and

Sporting Goods Association and the China Writing Instrument Association. The Company shares its strategic plans and practical achievements at industry conferences to contribute to Industry associations and

the industry's healthy and orderly development. During the reporting period the Company joined 21 industry associations and chambers of commerce paying annual membership chambers of commerce joined

fees totaling RMB240000.M&G actively fulfills its responsibilities as a leading enterprise in the industry through cross-border resource integration and industrial collaboration driving the transformation of

the stationery industry toward specialization greening and higher value. The Company partnered with People's Education Press to pioneer an integrated education and stationery 21

model filling a gap in specialized educational stationery solutions; it collaborated with the China Student Sports Federation (CSSF) to respond to the strategy of "Sports Powering the

Nation" and promotes the integration of sports and education and the development of sports products; it partnered with the Ministry of Ecology and Environment to launch the "Earth

Guardians" initiative setting benchmarks for sustainable products and guiding the value chain toward low-carbon development. Additionally in collaboration with Southern Weekly it

released the White Paper on Notebook Consumption Insights in China to lead industry-wide consumer insights and leveraged international platforms such as the Boao Forum for Asia

and COP30 to showcase the professional quality and sustainable concepts of Chinese stationery.M&G and the China Student Sports Federation (CSSF) Announce Strategic Partnership M&G's Sustainable Products Debut at the UN Climate Change Conference (COP30)Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 57

Information Security and Privacy Protection

M&G places a high priority on information security and privacy protection. By establishing and improving its information security management system the Company safeguards the information security and privacy rights of its

customers employees and partners protects the security of its corporate data assets and supports the sustained and healthy development of its business.Information Security and Privacy Protection

Management System Information Security Management

M&G places a high priority on information security and privacy protection and strictly complies with laws and The Company relies on a comprehensive system of policies and procedures for information security and privacy

regulations including the Cybersecurity Law of the People's Republic of China the Data Security Law of the protection to establish an end-to-end management mechanism covering early warning response and resolution.People's Republic of China and the Personal Information Protection Law of the People's Republic of China. M&G has formulated a business continuity plan (BCP) which includes data backup system redundancy disaster

The Company has formulated multiple management policies including the Information Security Management recovery solutions and specific operational procedures and responsibilities. BCP simulation tests are conducted

Manual the Information Security Policy the Information Security Management Organization the System at least semi-annually. During the reporting period we actively responded to the cybersecurity vulnerability

Construction Security Management Policy the Information Classification and Grading Labeling Management guidelines issued by the Cyberspace Administration of Songjiang District Shanghai. We promptly mobilized our

Policy . By continuously improving and refining our information security and privacy protection management technical resources to conduct a comprehensive review and remediation of our website and information systems.framework we ensure that the Company's information security management activities are conducted in a This enabled us to eliminate potential risks promptly and further ensure the effectiveness of our current systems.compliant and orderly manner. The Company strictly adheres to the principles of "legality legitimacy and

In 2025 the Company fully adopted Feishu as its unified office platform and use this as an opportunity to

necessity" clearly and transparently informing clients and consumers of the purpose scope and rationale for

strengthen its information security governance. The Company has established a working group to promote

data collection and ensuring that all business operations are conducted only after obtaining explicit consent.the Confidentiality Classification Management System issued the Guidelines for Document Confidentiality

Currently the M&G Alliance has obtained Level 3 certification of the Security Classified Protection for Information

Classification and Access Control and established a protection system covering the entire document life cycle.System Registration. The Jiumu Store social membership system has obtained Level 3 certification of the Security

Through a "tiered authorization and external access approval" mechanism we implement granular controls over

Classified Protection for Information System Registration and the email system has obtained Level 2 certification

document viewing forwarding and external access thereby strengthening internal information security barriers

of the same scheme. Colipu Group has obtained ISO 27001 Information Security Management System and

and driving significant improvements in the Company's information security management standards.ISO 27701 Privacy Information Management System certifications. During the reporting period M&G did not

experience any data security breaches or incidents involving the leakage of customer privacy.M&G Data Breach Response Mechanism M&G Information Security Early Alert Mechanism

Emergency Take prompt action to prevent or minimize losses resulting from an incident. Receiving Alerts System administrators and security administrators at all levels will check whether the devices under Response their management contain the vulnerabilities mentioned in the alert.Prompt Notify the data subject promptly. Targeted Security administrators at all levels will urge their departments to implement targeted preventive Notification Prevention measures and conduct random inspections of the department's systems.Improvement Investigate the cause of the incident develop and implement corrective Timely Once a related incident occurs and is resolved report it to the department's security management

Plan measures to prevent recurrence. Reporting organization.To enhance information security awareness among all employees the Company has continued to conduct a variety of information security training and awareness campaigns. During the reporting period the Company released

the instructional video M&G Employee Information Security Training . It produced specialized training materials to raise awareness of fraud prevention which were uploaded to the learning platform. Concurrently the Company

implemented email alerts to warn against fraudulent messages thereby strengthening employees' daily security vigilance.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 58

Privacy Protection Management

The Company has established Group-wide Personal Information Security Protection Management Measures that clearly define the channels for obtaining personal information collection methods usage principles retention

periods and deletion procedures. We strictly adhere to publicly disclosed privacy policies to ensure the compliant use of information. The Company has established an agile emergency response mechanism; should any personal

information breach be detected we will immediately launch an investigation implement control measures and promptly notify relevant parties. We will also take remedial actions based on the results of the investigation to

minimize the impact of the incident on our clients and consumers. During the reporting period all business segments further strengthened their security measures. Jiumu Store continued to enhance its procedures for responding to

data breaches and conducted regular employee awareness campaigns; Colipu Group completed a comprehensive upgrade to its website security effectively mitigating data breach risk through data anonymization access control

and log analysis.The Company's Audit Department conducts annual audits covering the collection storage and deletion of personal information as well as account and access management policy development and third-party oversight. Building

on the keen insights into compliance risks in the recruitment process gained in 2024 the Company will extend its information security protections to job applicants through its online recruitment system in 2025 thereby ensuring

comprehensive privacy protection across all stages—from talent acquisition to day-to-day operations.Case Jiumu Store Member Privacy Protection Initiative

In terms of data security and risk management Jiumu Store strictly adheres to a five-step response process which includes risk identification system isolation root cause investigation (locating the source of the leak

and determining the scope of impact) business notification and reporting to regulatory authorities. To ensure data security the Company implements measures to isolate data and administrative backends between

development and testing environments and the production environment restricting development and testing personnel from querying exporting logging into viewing or editing data in the production environment.During the reporting period Jiumu Stores conducted annual simulation drills effectively improving the team's emergency response efficiency; simultaneously the Company implemented a comprehensive backup strategy

to ensure a 100% success rate for disaster recovery. For technical roles the Company focused on hands-on training in encryption data masking and cryptographic computing. In contrast for testing roles it strengthened

training in system operation standards thereby comprehensively enhancing employees' data security literacy.Five-Step Response Process

v Risk identification System isolation Root cause investigation Business notification Reporting to regulatory authoritiesForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 59

Employees and

Communities

M&G embraces the development philosophy of co-

building and sharing and regarded employee well-being

and community prosperity as important components of

corporate value. By establishing an occupational health

and safety assurance system improving the support

mechanisms for employee rights and development and

fostering a diverse equitable and inclusive workplace

environment we provide employees with a platform

for self-growth and value realization. At the same

time the Company actively fulfills its corporate social

responsibilities. The Shanghai M&G Charity Foundations

continues to deepen its efforts in rural art education

community development and public welfare initiatives

supporting national strategies such as rural revitalization

and contributing to the joint creation of a better home

for society.Our goals

From 2024

To maintain 0 severe injuries and fatalities annually

By 2028

To ensure that 100% of full-time employees are

covered by the training system

BY 2030

To achieve 10 million instances of empowerment

Topics addressed in this section

Occupational health and safety

Employee rights and development

Diversity equity and inclusion

Social welfareForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 60

Occupational Health and Safety

M&G has always regarded production safety and employees' occupational health as its top priorities and has continued to improve its safety management systems and occupational health and safety management system to create

a healthy and safe working environment.Strategic Pillars Goals Progress in 2025

Empowering employees To maintain zero severe injuries and fatalities annually. Zero serious injuries and fatalities.and communities

Safety Management System

M&G strictly complied with laws and regulations such as the Law of the People's Republic of China on Work Safety Law of the People's Republic of

China on Prevention and Control of Occupational Diseases and Regulations on Work-related Injury Insurance established a comprehensive quality

environmental and occupational health and safety (QEHS) management system and formulated and implemented a series of safety management

systems including the Occupational Health and Safety (OHS) Policy 15 Operational Control Procedures for Environmental and Safety Management

and Safety Management Standards . At present M&G headquarters and subsidiaries including Colipu Group and Axus Stationery have obtained ISO

45001 Occupational Health and Safety Management System Certification. Meanwhile the M&G Shanghai base has passed the review of Guidelines of

Standardization of Corporate Work Safety (GB/T33000) and was rated as a Level 3 safety standardization certified enterprise. In terms of the management

mechanism we have established a safety management team at the Group level continuously strengthening compliance audits and institutional

penetration across subsidiaries at all levels to ensure consistency in Safety Management Standards and effective implementation. We also clarified

the boundaries of health and safety responsibilities through the EHS management responsibility map and carried out grid-based management with

responsibilities assigned to individuals. The signing rate of work safety responsibility statements reached 100%. We continued to increase investment in

production safety achieving 100% coverage of work injury insurance for all employees. Annual dedicated investment reached RMB2.96 million. Through

resource allocation and a risk-sharing mechanism we strengthened the occupational health and safety safeguard. During the reporting period the

number of recordable work-related injury incidents decreased by 31% compared with the previous year. In addition we actively promoted the digital

and intelligent upgrade of safety management. Leveraging the upgraded M&G Appointment Management System (TMS) the Logistics Center carried out

safety inspections and realized automated management of hazards from identification to closure thereby enhancing the efficiency and management

accuracy of risk inspections through technical means.Work safety responsibility agreement

signing rate Work-related injury insurance coverage rate Annual special investment

100 % 100 % RMB 2.96 million

Signing of the Safety Responsibility Agreement for the M&G Production Center

15. M&G's Occupational Health and Safety (OHS) Policy has been publicly released on the Company's official website under "Investors Relations - ESG - Reports and Policies."Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 61

Safety Risk Prevention

In 2025

The Company continues to improve the emergency management system and has formulated and regularly

updates Emergency Preparedness and Response Control Procedures . In terms of risk inspections we have

established a routine on-site safety inspection mechanism to identify potential safety hazards and risks Drill coverage rate across all production

compiled a list of issues and continuously tracked rectification progress to ensure the implementation of bases reached

safety risk rectification requirements. We proactively carry out in-depth reviews of work-related injury accidents

and ongoing inspections for safety hazards. In response to identified deviations in policy implementation

and localized protection gaps we systematically mitigate safety risks by promptly addressing omissions and

improving production safety rules and regulations. During the reporting period we promptly rectified non- 100 %

compliant operations and protection gaps identified through inspections strengthened warning notices

optimized operational procedures and improved our safety management level. In terms of special equipment

management the Company strictly complied with the requirements of State Administration for Market Fire Emergency Drill Conducted at the Logistics Center

Regulation Order No. 74 established a working mechanism of "daily management weekly inspections and

monthly scheduling" implemented primary responsibility and promptly eliminated safety hazards. In addition

we routinely organized multi-scenario emergency drills such as fire emergency response and hazardous waste

leakage. During the reporting period the drill coverage rate across all production bases reached 100% ensuring

that employees at all levels were familiar with emergency procedures and preventing safety risks.Case Axus Stationery Established A Safety Risk Management and Control Mechanism with Full Participation by All Employees

The Axus Stationery Shanghai plant innovatively launched a "near-miss" incident collection campaign systematically collecting safety hazards that had not yet caused

actual harm to achieve early risk identification and control. During the campaign more than 120 hazards of various types were reported cumulatively with a corrective Hazards of various types Corrective action

action closure rate of 100% effectively enhancing the depth of on-site safety risk identification. reported cumulatively closure rate reached

Based on this collection campaign the plant established a normalized safety risk early-warning mechanism. Through a "three-level feedback mechanism" a weekly +

issue list was formed and high-frequency hazard points were incorporated into the "Safety Red and Black List" for public disclosure as training materials for safety

briefings. In addition the Company established a dedicated incentive mechanism effectively motivating a shift in awareness among frontline employees from "passive 120 cases 100 %

compliance" to "proactive risk avoidance."

Three-level Feedback Mechanism for Safety Hazards at Axus Stationery Shanghai Plant

Responsible Body Operational Requirements Time Requirements

Employees Report locations operational contexts and potential risks of hidden hazards to unit heads or team leaders. On the same day

Unit Heads/Team Leaders Summarize and report in written form to supervisors and the EHS working group. On the same day or the following day

Supervisors and the EHS Working Group Visit the site to verify actual conditions and develop improvement plans. On the same day or the following dayForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 62

Health and Safety Education

In 2025

The Company legally organizes employees at our sites to participate in safety education and training strictly

implements the three-level safety education for new employees at the plant level workshop level and pre-

job level and requires 100% of personnel engaged in special operations and in critical safety positions to work Cumulative safety-related training totaled

with valid certificates. At the same time based on the annual safety training plan we have established a tiered

empowerment system covering "management personnel safety officers and all employees." The training

content covered fire safety emergency management hazard identification and risk assessment workplace

safety laws and responsibilities and operational safety. During the reporting period each subsidiary plant of 23840 hours

M&G held four routine training sessions per month for all employees with a cumulative total of 23840 hours of

safety-related training. In addition we promote cultural development mechanisms such as "Job Safety Chant

Lessons" embedding a safety culture into workshop practices and fostering a safety culture atmosphere in which

"everyone pays attention and everyone participates."

Health and Safety Training at the South China Base

Occupational Health Management

M&G continues to improve the occupational disease prevention and control system and remains committed to systematically reducing exposure risks to occupational disease hazard factors such as dust toxic gases and noise.The Company has implemented a pre-employment and on-the-job health examination system established and maintained occupational health records and promptly reassigned employees identified as having occupational

contraindications to avoid exposure to occupational disease hazard factors such as dust toxic gases and noise. Besides we regularly conduct on-site testing of occupational disease hazard factors to effectively ensure environmental

safety while providing employees with labor protection supplies and requiring employees to wear them. Taking the renovation of sanding line in the Axus Stationery Siyang Plant as an example the plant reduced the generation

of dust at the source through an integrated equipment dust removal system. At the same time it adjusts the regional layout of personnel density in the workshop to reduce personnel density in operating areas thereby effectively

safeguarding the respiratory health and operational safety of employees.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 63

Employee Rights and Development

M&G actively protects the rights and interests of all employees and places great importance on their comprehensive development. By focusing on the characteristics and needs of talent the Company has established a multi-level

multi-format and diversified talent development system providing high-quality learning resources and growth platforms to stimulate talent vitality and support mutual growth between the Company and its employees.Protection of Employee Rights

M&G strictly complies with the Labor Law of the People's Republic of China the Labor Contract Law of the People's Republic of China and other relevant laws and regulations as well as

the seven fundamental conventions of the International Labor Organization (ILO) ratified by China including the Equal Remuneration Convention . We have developed human resources

management systems such as the Employee Handbook to lawfully safeguard employees' legal rights and interests. M&G firmly prohibits forced labor and the employment of child labor does

not tolerate any unlawful infringement of employees' legitimate rights and benefits and forbids discrimination based on gender region ethnicity religion age pregnancy or marital status

disability or any other legally protected characteristic. We maintain zero tolerance towards harassment and violence. During the reporting period the Company ensures all employees to

sign employment contracts maintains 100% coverage of social insurance for employees pays salaries in full and on time and ensures that employee wages exceed the local minimum wage

standard.The Company established a trade union in line with laws and regulations and all employees are members of the union. Relying on the union management forums anonymous surveys and

other formats we have set up regular and varied channels for employee communication. We foster an open and clear feedback system encouraging employees to open and equal consultation

channels with colleagues superiors and subordinates through public and formal communication platforms and channels and to submit reasonable suggestions or views to management.During the reporting period the Company actively coordinated to address labor disputes and maintained a record with no major labor disputes.Employee Social Insurance Coverage Rate

100%

Trade Union Coverage Rate

100 %Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 64

Talent Attraction and Recruitment

M&G strictly enforces the Recruitment Management Policy and establishes selection procedures with unified standards and transparent processes to

ensure that evaluation criteria focus on the position's professional nature and safeguard the rights and interests of all candidates in fair competition. Case Colipu Group Actively Explores

Under this mechanism the Company actively recruits talent through multiple channels including campus recruitment social hiring internal referrals AI-Empowered Recruitment

and the "Huoshui Plan" (an internal talent mobility mechanism) to offer flexible employment opportunities to continuously expand our talent pool and In order to further develop a fair diversified and efficient

invigorate the organization. interview environment Colipu Group continued to improve its

recruitment management system. During the reporting period

the system introduced AI technology on the original basis

M&G actively engages in university-industry partnerships and continuously expands campus recruitment and realized a number of new functions online including AI

channels to precisely match graduates' employment and internship needs. Particular emphasis is customer service robots intelligent resume scoring automatic

Campus Recruitment placed on the "Child of Light" Management Trainee Program which offers a comprehensive 18-month message push AI-assisted interviews recruitment data Kanban

development system. This program provides systematic support – from onboarding guidance to etc. which effectively promoted the intelligence and efficiency

professional empowerment – to cultivate a solid reserve of talent for the Company's long-term of the recruitment process and at the same time improved the

development. interview experience of the applicants.The Company responds to the policy of stabilizing employment.Leveraging its stable production and operations it continues to provide New jobs created in 2025

a large number of labor positions offering a reliable career starting

point for both local and migrant workers. With the completion and

commissioning of the Central China base more than 400 new jobs 400

were created during the reporting period of which more than 60%

Diverse Employment were local employees effectively boosting regional employment. To of which

address the flexible labor demands in production and logistics the local employees accounted

Company provides diverse flexible employment opportunities such as for over

manual labor equipment operation sorting loading and unloading.Specifically we have established inclusive positions tailored for 'stay-

at-home mothers' to effectively absorb and empower the social labor 60 %

force.The Company has expanded the use of a digital recruitment platform

promoted the online construction of internal recommendations Proportion of hires

and realized the self-service inquiry and recommendation function through internal referral

channels in 2025 reached

of internal promotion positions which effectively improved the

Internal efficiency of the internal promotion process and enhanced the degree

Recommendation of professional suitability of the candidates and the organizational

culture fit. During the reporting period hires through internal referrals 9.5 %

accounted for 9.5% of total hires making it an integral part of the

Company's talent recruitment and development system.M&G Awarded "Best Recruitment Team" in the 8th China HR Sirius AwardsForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 65

Training and Development

M&G is committed to building a systematic and forward-looking talent development ecosystem closely aligning the cultivation of employee potential with the Company's strategic objectives. We provide diverse learning resources

and clear career paths fostering an atmosphere of continuous learning to ensure that employees are empowered and can realize their personal value within a dynamic business environment.Strategic Pillars Goals Progress in 2025

Empowering employees To ensure that 100% of full-time employees are covered by the training Employee training coverage reached 85.6%.and communities system by 2028.Promotions and Incentives

M&G has formulated the Employee Promotion Management System to provide employees with a clear career The Company has built a differentiated compensation system deeply linked to business achievements to

development framework and advancement pathway. The Company has established multiple promotion drive organizational effectiveness through incentive mechanisms. We have a performance-based variable

mechanisms including annual promotion on-post promotion management trainee promotion and compensation mechanism for all employees that accounts for employee performance bonuses and year-end

management-level promotion. Promotion criteria are determined based on comprehensive performance awards based on performance evaluations as well as position and salary adjustments. During the reporting

evaluations center achievements and other dimensions to ensure fairness and transparency in the promotion period the Company further revised the Performance Management System optimized the link between

system. During the reporting period new management specifications for promoting senior management performance results and individual bonuses and increased bonus incentives for top performers. At the same

personnel were added and the scope of application and qualification requirements for top-ranking promotion time special incentive programs were tailored for core business lines such as overseas business product

were optimized. By optimizing the standardization and scientificity of the promotion management process research and development and large retail stores to effectively stimulate the enthusiasm and creativity of key

a clearer career development path is provided for employees and core talents are accurately selected and business teams.cultivated.Training and Progress

In 2025

M&G is committed to improving the training system so that each employee can access the training resources that best suit their stage of career development. The Company

has built a "Talent Development Panorama" that centers on the three dimensions of general knowledge professionalism and leadership forming an employee training Average Training Hours per Employee

system characterized by "full-cycle multi-level and practice-oriented" features. Currently the training system covers 100% of full-time employees.During the reporting period in terms of professional skills empowerment the Company conducted in-depth talent assessments across core functional sequences including

product sales and procurement. By precisely identifying gaps in position-specific competencies we provided employees with a multi-level and classified customized 11.4 hours

curriculum system effectively transforming theoretical knowledge into practical capabilities. In terms of general competence empowerment the Company launched

the "M&G Lecture Class" program which was open to all employees for active enrollment with a total of 6 offline training sessions and 2 online thematic camps covering Investment in Training

practical topics such as Digital Transformation and AI Practice Project Management Course for Product People Business Negotiation Skills etc. A total of more than 880

participants attended the training. In terms of leadership development we continue to deepen the classic management training program and launch a new specialized

training program for middle and senior management to systematically improve managers' strategic vision and comprehensive leadership.RMB 3.04 millionForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 66

M&G's subsidiaries organize specialized training and empowerment programs tailored to their respective business requirements. Jiumu Store has launched three-phase courses namely "Star Start" "Leading Plan" and "Huangpu

War Camp" for employees at different levels in retail stores to enhance their knowledge and empower their career development covering 1650 people during the reporting period. Through years of internal trainer training Colipu

Group has built a team of 311 internal trainers and constructed a three-dimensional training system of "business-oriented online and offline integration" to realize the effective precipitation of organizational knowledge and ability.In addition we encourage employees to pursue external professional qualifications highly relevant to their positions during their employment and establishes an incentive mechanism to reimbursements for professional certification

exam fees. We continuously empower employees in audit and finance positions to deepen their professional fields with 3 employees certified as Certified International Internal Auditors (CIA) and 8 employees certified as finance

professionals. In 2025 we further expanded the coverage of the certification incentive mechanism introduced a special certification for safety management and subsidized and supported 18 employees in completing the safety

officer training certification to consolidate the foundation of safety production.Case "Child of Light" Management Trainee Development Program

M&G regards management trainees as strategic reserve talent for the future and has prioritized their development. During the reporting period the Company conducted a comprehensive upgrade of the management

trainee program across the entire chain from talent selection and identification to process-oriented training and career development. By the end of the reporting period the retention rate of this cohort of management

trainees had reached 98%. Through systematic training and real work a group of reserve talents has taken on duties in key roles. The M&G Management Trainee Development Program centers on "Cultural Heritage and

Job Competence" and focuses on the following key areas:

* Cultural Integration and Value Transmission: Through intensive training face-to-face training for executives and

cultural classes the Company deepens its understanding of M&G's culture strategy and business and the lead

instructors model M&G's values.* Development of Practical Job Skills: Through task guidance instant feedback and monthly review the course

helps students complete transition into skilled professionals and proficient role-holders; it emphasizes the daily task

management cycle weekly summary and other workplace habits.* Systematic Learning and Habit Formation: Through a four-week online course on The 7 Habits of Highly Effective

People supplemented by reflective and practical assignments bussiness professional is driven.* Cross-Cohort Integration and Innovation: Through the "Integration and Innovation Camp" deep links and team

creation are fostered among the 2024 and 2025 management trainee groups.

2025 M&G "Child of Light" Management Trainee Induction Training

Case "Combination of Training and Operation"-New Leaders Training Camp

To accelerate the development of business acumen and integrated management capabilities among core leadership

the Company launched the "New Leaders Training Camp" focusing on the breakthrough in three dimensions of business

solutions: business thinking innovation and ability to change and innovate. By imparting management tools such as the

MBS methodology and the M&G six-step method we emphasize application and practice through real business cases.Through the improvement of eight critical t of replicable problem-solving methodologiesbusiness initiatives we have

achieved several substantive operational enhancements.This process has led to the developmen such as Return Process

Optimization and Store Attachment Rate Enhancement . These efforts prioritize situational awareness and collective

problem-solving successfully internalizing the MBS methodology as a common business language and management logic

for our leaders.

2025 M&G New Leaders Training CampForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 67

Happy Workplace

M&G actively builds an all-round multi-level welfare and culture system and is committed to creating a warm corporate culture. We use the dedication survey to listen to and respond to employees' voices and demands. At the same

time we provide comprehensive welfare policies and organize colorful cultural activities to foster a positive harmonious and pleasant workplace atmosphere and enhance employees' sense of belonging and happiness.Employee Engagement Survey

The Company annually commissions a professional independent third-party agency to conduct a company-wide employee engagement

survey which is anonymous and covers dimensions such as company strategy organizational capabilities career development cultural

values etc. In the inaugural survey conducted in early 2025 employee participation reached 90% yielding over 1400 pieces of authentic

feedback. Following the results management initiated in-depth discussions that identified "collaboration leadership and care" as three

strategic areas for improvement. To ensure that these changes are effectively implemented improvement actions were cascaded down

to various functional centers through co-creation workshops. For example the Digital Center leveraged the opportunity presented by a

switch in collaboration tools to release the Rules for Efficient Work breaking down collaboration barriers. Jiumu Store quickly adjusted

restroom ratios based on staff demographics improving facility inclusivity. Through the rapid execution of these initiatives employees

have experienced more empathetic and efficient management effectively strengthening organizational cohesion and a sense of

belonging.Employee participation in the inaugural

engagement survey reached

90%

Authentic feedback received

totaled over

1400 pieces

Executive Workshop on Employee EngagementForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 68

Employee Benefits

In addition to ensuring the implementation of statutory benefits such as social insurance and paid leave M&G Highlights of the 2025 Employee Benefits Upgrade

has established and continues to refine a multi-tiered employee benefits system. During the reporting period

the Company released the "Employee Benefits Panorama" which systematically integrates the five dimensions

of growth and development respect and recognition emotional connection health protection and customized

* Benefit Holidays: Half-day benefit holidays were added for International Women's Day and

care to protect employees in all aspects. The platform for employee benefits and the "Xiaochen" AI assistant

Children's Day to encourage employees to spend more time with their families and achieve a

were put online during the year realizing the intelligent integration of policy consultation activity guidance

better work-life balance;

and process application. This has promoted the transformation of benefits services from "people looking for

benefits" to "benefits looking for people" and effectively enhanced the efficiency of achieving benefits and * Flexible Work Arrangements: Implemented a pilot flexible work hours for selected functional

employees' sense of happiness. roles allowing employees to adopt staggered shifts based on business requirements and

personal needs;

* Health Check-ups Coverage: Continuously broadening coverage of employee health check-

ups to benefit a greater number of frontline employees;

* Health Services: Utilizing the on-site gymnasium and medical room in our headquarters

employees can book fitness sessions medical exams and club activities via a self-service

welfare platform; introduced the physical therapy resources of traditional Chinese medicine

to provide services such as pulse questioning neck and shoulder adjustment and meridian

unblocking to alleviate the occupational physical fatigue of employees;

* Mental Health: Introducing an online "Mental Health Hub" as part of the Employee Assistance

Program (EAP) to provide professional psychological support;

* Benefits Promotion: Launched "Benefits Month" activities transforming traditional benefits

promotion into a fun employee experience through interactive forms such as live lectures

creative bazaars and treasure hunts.Online Employee Benefits Platform M&G Employee Benefits Panorama

M&G Employee Benefits Month ActivitiesForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 69

Culture and Care

M&G is committed to transforming corporate culture into an internal driver of organizational evolution. During the reporting period the Company integrated and upgraded

its workplace cultural activities by linking the festival activities sports competitions art festivals public welfare activities and other isolated programs in the past into an

annual cultural map with the theme of "Growing Towards the Sun." Relying on the seasonal theme of "Sowing Growing Blooming" the Company creates a predictable and

perceivable cultural experience for its employees. This initiative creates a predictable and perceptible cultural experience for its employees. The "Photosynthesis Alliance"

composed of young representatives from each business unit serves as the "capillaries" of cultural dissemination. Operating through a decentralized model the alliance

stimulates grassroots cultural co-creation within each department. While effectively alleviating workplace pressure this system also drives cross-functional collaboration

and team innovation. During the reporting period subsidiaries across the Group also launched distinctive employee activities. For instance Colipu Group hosts monthly

birthday celebrations for employees while Jiumu Store holds a "Most Inspiring Workspace" contest collectively fostering a warm workplace atmosphere.

2025 Corporate Culture Activity Map

M&G "Family Day" M&G Sports Day Curling Event M&G Mid-Autumn Festival "Garden Party" Event Colipu Group Employee Birthday Party Jiumu Store "Most Inspiring Workspace" Contes

Case Building a Culture of Sustainability

M&G continues to expand the reach and depth of its sustainability culture. For the third consecutive year we have appointed Sustainability Ambassadors across

all functional centers and departments. Serving as "communicators" and "connectors" of our corporate strategy these ambassadors bridge the gap between high-

level objectives and the daily lives of our employees. In 2025 supported by optimized incentives we upgraded this initiative into the "Photosynthesis Alliance." The

ambassadors' scope has evolved from basic energy conservation and philanthropy to a broader focus on employee well-being and brand co-creation ensuring that

sustainability is deeply integrated into the daily experience of our workforce.Building on this long-term cultural foundation the Company holds an annual "Sustainability Month." In 2025 the second edition themed "Hello Sustainability:

Green Ideas Innovation Call" invited employees to submit creative solutions for sustainable practices. The campaign received over 60 innovative proposals covering

circular economy sustainable product design and green office initiatives. Following a selection process involving company-wide voting and executive evaluation six

outstanding cases were identified for potential inclusion in the next year's sustainability work plan. This initiative was not only a synthesis of collective intelligence but

also a pioneering step in expanding the pathways for employee participation in ESG governance.

2025 "Photosynthesis Alliance" AmbassadorsForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 70

Diversity Equity and Inclusion

M&G integrates the principles of Diversity Equity and Inclusion (DEI) with the Company's "openness and inclusiveness" values actively fostering a workplace environment where employees from diverse backgrounds can fully realize

their potential and achieve self-worth.Equal Opportunity and Respectful Conduct Building a Culture of Diversity and Inclusion

M&G is committed to respecting employees from diverse backgrounds and cultures each with unique Upholding the core value of "Openness and Inclusivity" M&G continuously strengthens the foundation of a fair

characteristics and perspectives. The Company ensures that every employee receives equal opportunities and and diverse workplace through initiatives such as the Women's Leadership Program the "Huoshui Plan" and

fair treatment throughout all stages of recruitment career development and performance appraisal fostering Openness & Inclusivity Workshops. In 2024 we formally identified Diversity Equity and Inclusion (DEI) as a

a workplace environment built on mutual respect and free from discrimination or harassment. The Company core strategic priority and released our 2030 Action Roadmap. To ensure the substantive implementation of this

has established the Anti-Discrimination and Anti-Harassment Policy16 which explicitly prohibits such behaviors. strategy we officially established the "Chief Diversity Officer (CDO)" mechanism in 2025. Led by the Vice President

Furthermore we have extended our DEI requirements to suppliers and business associates identifying and of Human Resources a dedicated DEI Task Force—composed of core senior executives—was formed to oversee

continuously tracking potential impacts across the value chain through labor risk assessments. The Employee the development of our DEI framework and culture. This ensures that DEI principles are woven into the very

Handbook clearly outlines reporting channels and detailed handling procedures with strict confidentiality fabric of our business operations fostering a more resilient organizational ecosystem.maintained regarding the whistleblower's information. M&G prioritizes fairness in the recruitment process.During the reporting period it conducted multiple rounds of internal communication with recruitment teams

and initiated revisions to the Recruitment Management System with the aim of formally incorporating anti-

discrimination and anti-harassment guidelines into the institutional framework.M&G DEI Strategy House

Vision

Cultivating a Diverse and Inclusive Environment Nurturing Every Individual with Care

Define the DEI development strategy establish a DEI task force and make DEI a shared consensus for development

Diversity Equity Inclusion

Diversity in Talent: Valuing employees Equal Opportunity: Establishing Cultural Inclusion: Fostering an open

Goals and Strategies from diverse backgrounds genders and clear and fair talent selection and trusting and safe work setting

cultures development mechanisms

Inclusive Decision-Making: Establishing

Diverse Thinking: Encouraging new Equitable Access to Resources: decision-making mechanisms that

thought and the flow of ideas Providing equal opportunities for access promote democratic participation and

to resources and differentiated support listen to diverse perspectives

16. M&G's Anti-Discrimination and Anti-Harassment Policy has been published on the Company's official website under "Investor Relations – ESG – Reports and Policies."Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 71

Empowerment of Female Employees In 2025

M&G places great importance on the rights and interests of all employees supporting their professional growth and helping them achieve a work-life balance. M&G and Percentage of Female Employees

its subsidiaries provide employees with various leave options including maternity and parental leave and have established nursing rooms to offer clean private spaces

for breastfeeding employees. The Company continues to offer "Parent Child Mother EQ Course" and organized the second session of the Women's Leadership Workshop

during the reporting period to help female employees better understand their strengths and potential thereby encouraging them to pursue their career goals with greater 49.4 %

confidence.Case Women's Leadership Workshop

To help female managers translate their empathy meticulousness and resilience into unique leadership

strengths the Company hosts a women's leadership workshop titled "Flexibility: The Inner Strength of

Female Leaders." The program focuses on M&G's senior and mid-level executives and has reached 79%

of women at management level in headquarters teams. The workshop integrates the three modules of

"Skills Advancement Mental Empowerment and Identity" to help female talents build up their professional

confidence while assisting them in building a peer support network which effectively promotes the growth

of female leaders and the construction of a mutual support ecosystem and enriches M&G's management

connotation in the field of diversity and inclusion.M&G Women's Leadership WorkshopForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 72

Social Welfare

Since its inception M&G has been actively fulfilling its social responsibilities. In 2015 the M&G Rainbow Charity Fund was established. In 2020 the Shanghai M&G Charity Foundation ("M&G Charity") was officially founded. Upholding

the philosophy of "promoting quality education and empowering inclusive community development" M&G Charity has carried out a variety of charity programs. M&G Charity adheres to the philosophy of guiding the industry

in joining the efforts for doing good focusing on three major areas: rural education care for special groups and community care. It has carried out the rural art education program the "Golden Seed Plan" education assistance

program and the Autism Support Program. It also actively engages employees customers and other stakeholders in charitable activities. As of the end of the reporting period M&G Charity had carried out educational charity

initiatives in 138 prefecture-level cities across 32 provinces municipalities and autonomous regions in China. In 2025 the total amount of public welfare funds and materials donated by M&G Charity and its subsidiaries was RMB11.6

million benefiting more than 921000 people.Strategic Pillars Goals Progress in 2025

Since 2022 the educational charity initiatives have generated over 2.03 million

Empower employees and To achieve 10 million instances of empowermen by 2030. instances of benefit.communities

Focus on Art Education in Rural Areas

M&G Charity actively responds to national policy requirements on art education and makes rural art education a long-term strategic focus. Through its systematic program M&G Charity continues to invest resources to support art

education in rural schools and to promote the balanced development of educational resources across urban and rural areas. Base on the years of deep cultivation in the field of rural art education the Company launched the "Art

Education Plan" program in 2022 which aims to comprehensively improve the quality of art education in rural schools and communities through the collection of lesson plans teacher training and donation of art kits as well as

linking the resources of public welfare foundations corporations and university teaching clubs to promote the construction of an industry ecosystem in the field of art education for rural children.In 2025 the "Art Education Plan" program is committed to building a three-in-one empowerment system of "teaching and research practice and innovation and popularization of resources" to open up a window of knowledge for

the diversified growth of rural children.Teaching and research empowerment Practical innovation Resource popularization

M&G Charity has teamed up with the Academy of Arts & Design M&G Charity under the guidance of the National Permanent M&G Charity has linked 800 college volunteers to serve more than

Tsinghua University to develop professional lesson plans covering Standing Commission-Young Pioneers of China (NPSC-YPC) has 35000 children through summer tutoring and pioneered the model

the dimensions of non-genetic inheritance and green environmental organized the Village Painting Competition and a series of public of "community art education stationery cabinet" which brings

protection and open them to primary and secondary schools welfare painting exhibitions gathering over 170000 entries to high-quality art education resources and materials to schools

nationwide for free; simultaneously partnering with a professional create an art stage for rural children to showcase themselves. communities and urban spaces thus realizing the extension of the

team from East China Normal University to develop mental health chain of art education from campus life to the social scene.arts education courses using artistic interventions to improve

children's psychological well-beingForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 73

Case Art Education Empowers Rural Children's Mental Health

Mental health needs are especially strong in rural areas and these regions have a limited supply of professional help. In response M&G Charity

partnered with a team led by Associate Professor Zhang Ya from the School of Psychology and Cognitive Science at East China Normal University

to develop a mental health and art education curriculum tailored for rural children. The curriculum covers four key dimensions – emotional

awareness emotional regulation emotional expression and emotional understanding – and uses art forms such as painting and crafts as vehicles

to integrate emotional management knowledge into art education thereby subtly enhancing students' emotional management skills. During

the reporting period the curriculum was implemented in over 200 schools across 16 provinces reaching a total of more than 20000 students. To

systematically evaluate the program's effectiveness M&G Charity and the East China Normal University team measured key indicators – including

overall mental health status and mental health literacy – before and after the curriculum was implemented. The results showed that more than

one-third of children who previously showed signs of mental health issues successfully returned to a healthy mental state. The findings of this study

were officially published in the Implementation Report of an Art Education Based Mental Health Education Programme for Rural Children providing

strong evidence for the empowering role of art education in children's mental health education. Student Self-Assessment of Emotional Well-being in art Education Courses

Everyone for Charity

In 2025

M&G actively promotes a corporate culture of "Everyone for Charity." Each year it organizes senior executives and employees to participate in large-scale

charity events such as the "E.G.G Walkathon" charity walk the "99 Giving Day" events and Executive Charity Trips. It also hosts charitable activities in Volunteer service participation by M&G and its subsidiaries

various themes including autism day integration activities charity bazaar sales summer study and teaching assistance for rural students and charitable

ice show attendances gradually integrating charity into the daily lives of employees. M&G established the M&G Volunteer Team implemented a volunteer

service point and reward system and enabled volunteers to log their service hours in the official Shanghai volunteer database thereby allowing them

to benefit from government incentive policies. M&G Charity also presents commemorative certificates to volunteers to establish a long-term incentive 1196 person-times

mechanism that encourages employees' continued participation in charity.In 2025 M&G Charity participated in the "E.G.G Walkathon" for the eighth year with more than 400 employees raising over RMB30000 through sports

challenges. Since 2023 the Company has launched the "Light Encounter in the Countryside Fulfilling New Year Dreams" themed public welfare Total volunteer service

campaign internally for three consecutive years. Through a targeted "micro-wish" matching model it provides substantial support for children's daily life

and education in underdeveloped regions. In 2025 the initiative fulfilled New Year's wishes for 125 children. Additionally Colipu Group partnered with

M&G Charity to donate a wide variety of supplies including stationery gift packs and art supplies to the Southern Weekly Hope Primary School. They

hours

also carefully prepared art education courses for the children enriching their dreams through a dual approach of "supplies plus empowerment." During 4946

the reporting period M&G and its subsidiaries recorded a total of 1196 volunteer participation instances amounting to 4946 volunteer service hours.The "E.G.G Walkathon" charity walk Employee Volunteers Employees participating in the Autism Support Program Colipu Group's Rural Art Education Charity TourForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 74

Innovative Charity

M&G Charity actively explores integrating business thinking with philanthropic goals enabling projects to take root and flourish within communities creating a virtuous cycle. The initiative transitions from a one-way donation model

to a sustainable philanthropic ecosystem achieving self-sustaining and long-term development of charitable projects through resource linkage and model innovation.In 2025 M&G launched the "Community Charity Stationery Cabinet" to explore a new model of social welfare that focuses on skills building empowering grassroots social organizations to enhance community vitality. The Company

lowers the barrier to entry by supplying goods at charitable pricing supporting community partners in achieving sustainable operations through independent management. At the same time M&G Charity is deeply involved in

the construction of the stationery cabinets and provides materials for charitable activities and capacity-building training. By linking sales to social aid this plan strengthens the self-sustaining capacity of local groups and creates a

mutually beneficial system that includes firms social groups and community residents. As of the end of the reporting period the project has been implemented in Shanghai Guizhou Sichuan Hangzhou Zhengzhou Chongqing

and other provinces and cities covering nearly 50 communities nationwide with over 200 communities expressing intent to collaborate.Case China's First "M&G Charity Store"

In November 2025 the first "M&G Charity Store" in China was officially launched in the Duling Subdistrict of Jinshui District Zhengzhou marking the inaugural pilot of M&G Charity's "Business Empowering Charity" model.Jointly developed by M&G Charity and the Xinshan Volunteer Service Center of the Zhengzhou Economic and Technological Development Zone the project converts retail profits from community stationery sales into a

dedicated community public welfare fund. This fund provides standardized services for children in distress including art education psychological counseling and after-school care establishing a sustainable "Retail Self-

Sustenance and Targeted Assistance" mechanism. The store features multi-functional zones for art reading and mental health while initiatives such as "Points for Charity" and "Idle Items Recycling Plans" encourage

residents to co-create social value through their purchasing behavior. As an innovative model of "Government-Enterprise-Society" collaborative governance this project provides a replicable systematic solution for

corporate social responsibility and community co-construction.Zhengzhou "M&G Charity Store"Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 75

Governance

and Integrity

M&G is committed to building a corporate governance

system that is "transparent accountable and

sustainable." Through a sound governance structure

and effective risk management we safeguard the

achievement of our strategic objectives protect the

interests of shareholders employees customers

and all sectors of society and promote the shared

sustainable development of both the enterprise and

society.Topics addressed in this section

Corporate governance

Investor communication

Risk management

Business ethicsForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 76

Corporate Governance

M&G strictly complies with the requirements of laws regulations and normative guidance documents such as the Company Law of the People's Republic of China Securities Law of the People's Republic of China Code of Corporate

Governance for Listed Companies and Self-Regulatory Guidelines for Listed Companies of the Shanghai Stock Exchange strengthens the development of our corporate governance system and standardizes our operations. During

the reporting period we proactively benchmarked against the requirements of the new Company Law revised the Articles of Association and supporting governance systems ensured that corporate governance remains aligned with

regulatory requirements and enhanced governance effectiveness and modernization. Through this adjustment we canceled the establishment of the Board of Supervisors and strengthened the functions of the Audit Committee of

the Board of Directors which exercised the supervisory authority. We established a mechanism for special meetings attended entirely by independent directors and strengthened the powers and authority of independent directors.Duties of the Board of Directors

The M&G Board of Directors operates strictly in accordance with the Articles of Association and the Rules of Procedure of the Board of Directors. All directors perform their duties with diligence effectively fulfilling their supervisory

and strategic guidance responsibilities. During the reporting period a total of five meetings were held with a 100% attendance rate among directors. The Board has established four Committees: the Strategy Committee the Audit

Committee the Remuneration and Appraisal Committee and the Nomination Committee. These Committees handle deep study and discussion on key areas such as strategic plans audit oversight pay and review and nomination

and choice.Responsibilities of the Committees of the Board of Directors

Strategy Committee Audit Committee Remuneration and Appraisal Committee Nomination Committee

Responsible for studying and recommending Fully exercising the supervisory powers of the Responsible for formulating the assessment Responsible for researching reviewing and

the Company's long-term growth plan and former Board of Supervisors it is responsible criteria for directors and senior executives providing recommendations on the selection

key investment decisions. for supervising the Company's finance and conducting assessments; formulating criteria and procedures for candidates for the

internal control and the performance of and reviewing the remuneration policies and Company's directors president and other

duties by directors and senior management. plans for directors and senior executives with senior management positions that need the

the authorization of the Board of Directors. appointment of the Board of Directors.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 77

Composition of the Board of Directors

In 2025

Directors are elected by the shareholders' meeting. The term of office for directors is three years and they can be re-elected for consecutive terms upon expiration of their

term. Independent directors shall not serve for more than 6 years consecutively. The Company attaches importance to the independence of the Board of Directors and

there are 3 independent directors among the 7 members of the Board of Directors which meets the Measures for the Management of Independent Directors of Listed Number of female Proportion of female

Companies which requires that the proportion of independent directors of the Company to the Board of Directors shall not be less than one-third and that the independent board members board members

directors shall not serve in more than 3 listed companies at the same time. The Company's three independent directors have professional experience in law accounting

and management consulting respectively as well as expertise in strategic development corporate governance and risk management allowing them to provide effective

advice for decision-making in various dimensions of the Company's development. An independent director also has experience in the manufacturing industry 1 14 %

The Company has clarified its policy on diversity of the Board of Directors by specifying in the Rules of Work of the Nomination Committee of the Board of Directors that

the selection of directors shall be based on a diversity perspective including such as professional experience cultural and educational background age and gender to

ensure the competency of the Board of Directors to make scientific decisions. As of the end of the reporting period there was one female member on the Board of Directors

accounting for 14% of the total.Director and Executive Compensation and Evaluation

The pay plan for the Company's directors and senior management comprises fixed and variable components. Variable pay is closely tied to the achievement of the Company's strategic goals profit growth and key ESG performance

metrics and is subject to ongoing review. Under the new governance structure the Audit Committee reviews the accuracy of financial data to provide the Remuneration and Appraisal Committee with an objective basis for

evaluation ensuring the fairness and compliance of compensation distribution. In terms of clawback and retrospective requirements the Company has clarified the behavioral prohibitions and legal liabilities of controlling

shareholders and executives and restrained directors or executives who have suffered losses to the Company as a result of non-compliance with their duties through an institutionalized recovery mechanism to ensure that the

incentives are equal to the risks and responsibilities.Investor Communication

In 2025

M&G consistently upholds the principle of maximizing shareholder value and operates

with an open and transparent philosophy continually strengthening communication and

interaction with investors while listening to diverse opinions and suggestions. We have

established the Investor Relations Management System to standardize related operations M&G was honored with the

and built a communication system to enhance the engagement with investors and potential

investors through announcement disclosures performance briefings the SSE E-interactive 16th Tianma Award for

on-site research telephone email and other channels to provide timely and effective Investor Relations Manage-ment of Chinese Listed Com-

responses to investor inquiries. panies during the reporting

To effectively safeguard the legal rights and interests of minority shareholders M&G assigns period

dedicated personnel to maintain and monitor communication platforms ensuring the

smooth operation of the SSE E-interactive platform public investor email and hotline.During the reporting period M&G responded to over 40 questions on the SSE E-interactive

platform with a 100% response rate. The Company also proactively disclosed 7 institutional 2024 Annual Report Earnings Briefing

investor research summaries in the "Listed Company Announcements" section of the

platform. M&G was honored with the 16th Tianma Award for Investor Relations Management

of Chinese Listed Companies during the reporting period.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 78

Risk management

M&G conducts risk management and control with the objectives of "optimizing operations preventing corruption and controlling risks." In 2023 the Company established the Risk Management and Compliance Committee which is

led by the President. Members of this committee include heads of the Sustainability Office Human Resources Center Audit Department Legal Affairs Department and Finance Center. The committee functions independently from

business management departments to ensure the objectivity and independence of the Company's risk management function. During the reporting period the Risk Management and Compliance Committee continued to deepen its

operation drew the annual risk map of the Company identified and locked the 3 major core risk areas and implemented special optimization and constructed a complete early warning monitoring and response mechanism; and in

view of the Company's globalization layout set up the Overseas Risk Management and Compliance Committee to carry out risk tracking and closed-loop management cycle for the whole life cycle of the overseas business. The Risk

Management and Compliance Committee convened twice during the year. Additionally the committee provided ad hoc reports to the President on key risk control priorities such as risk early warnings and the optimization of risk

response strategies.Organizational Structure of the M&G Risk Management and Compliance Committee

President

Risk Management and Compliance Committee

Finance Center Audit Department Legal Affairs Department Human Resources Center Sustainability Office

M&G continuously refines its three-line-of-defense risk management system comprising "business departments functional departments for risk management and the audit department" During the reporting period M&G focused

on high-risk business processes conducting specialized improvement initiatives in policy development process optimization and system enhancements. Policies and documents were revised to reflect actual conditions and clarify

implementation standards; the Company also identified key risk control points and continuously monitored business improvements through internal control maturity assessments thereby reducing potential risk exposure.M&G's "Three Lines of Defense" Risk Management System

Business units/

First line of defense functional Each business unit is the primary responsible party for internal Developing business Developing relevant

departments control responsible for resolving over 95% of issues process standards processes

Functional departments for risk

management (Internal Control Developing risk Monitoring activities Providing "coaching" on the Carrying out inspections to ensure Second line of defense Department and Compliance strategies and conducting internal control system sound internal control of high-risk

Department) inspections businesses

Third line of defense Audit Department Carrying out Carrying out internal Carrying out spot inspections for audits for special audits control audits corruption and fraudulent incidents as a deterrentForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 79

Business Ethics

M&G is committed to building a "zero tolerance" business ethics management system. Through comprehensive institutional development strict risk control and regular integrity education the Company fosters a business

culture characterized by "openness transparency and integrity" to ensure the Company's sustainable development. During the reporting period the Company maintained full compliance and avoided any litigation or significant

administrative penalties related to embezzlement bribery or unfair competition.Business Ethics and Compliance Management System

M&G strictly complies with the Anti-Monopoly Law of the People's Republic of China the Interim Provisions on Prohibiting Commercial Bribery the Law of the People's Republic of China Against Unfair Competition and other relevant laws and

regulations. Relying on a series of management systems including the Code of Business Conduct 17 the Company continuously strengthens its management of business ethics fair trade practices and ethical competition. This has resulted in

a comprehensive and systematic business ethics and compliance management system. The M&G Risk Management and Compliance Committee serves as the coordinating organization for compliance work and is responsible for system and

process optimization compliance risk assessment implementation review and supervision and the building of a compliance culture to ensure that the Company's business activities comply with laws and regulations industry guidelines and

internal management requirements.M&G Business Ethics and Compliance Management System

Anti-Corruption and An- Anti-Unfair Com- Anti-Mo- Data Security and Cus- Product Intellectual

ti-Bribery petition nopoly tomer Privacy Protection Compliance Property

Anti-Unfair Competition

M&G abides by the business principle of fair competition and has built a competition compliance management system covering the entire business chain. Based on the Law of Anti-Unfair Competition and the laws and regulations

of the business locations the Company has completed a systematic sorting and benchmarking of its compliance system to improve it. The Company has formulated the Trademark Management System the Management

System Against Fraudulence the Management System for Trade Secrets and the Online Omni-Channel Store Operation Rules to prevent and address confusing behavior commercial bribery trade secret infringement and unfair

competition on the Internet. In terms of product publicity and promotion the Company has integrated and sorted out the existing systems and released the Product Development Compliance Knowledge Base to eliminate false

publicity commercial defamation and illegal marketing behavior and to ensure that the Company always maintains norms transparency and integrity in its omni-channel operations.

17. M&G's Code of Business Conduct has been published on the Company's official website under "Investor Relations – Corporate Governance."Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 80

Anti-Commercial Bribery and Anti-Corruption

The Company has formulated the Management System Against Fraudulence18 the Letter of Commitment on Integrity and Self-Discipline the Transparent Procurement & Integrity Convention 19 and other anti-bribery and anti-

corruption documents and systems to establish mechanisms to constrain the compliance behaviors of its employees and suppliers and continues to make improvements. The Company places high importance on identifying risks

related to commercial bribery and corruption as well as on internal control efforts. The Audit Department conducts internal audits in accordance with the Company's Internal audit management system . By reviewing the Company's

business scope identifying high-risk key positions and mapping out a "Risk Map" the Company has achieved dynamic optimization of internal control measures.To strengthen employees' integrity and self-discipline in external communications and internal operations the Company issued the Integrity Gift Management System during the reporting period. The system embedded integrity

requirements into daily operations by clarifying behavioral boundaries and standardizing the approval process continuously regulating the professional conduct of employees and maintaining a fair environment for cooperation

with business partners. During the reporting period Colipu Group further revised the Anti-Bribery Anti-Corruption and Anti-Fraud Management System clarified the red lines and the standards for disciplinary actions in the Internal

Audit Management System and passed certification for the ISO 37001 Anti-Bribery Management System Against Fraudulence.M&G has established multi-channel complaint and whistleblowing channels which are publicly disclosed on the official website. Additionally the Company has established the Internal Investigation and Handling System for

Employee Misconduct and the Whistleblower Protection and Non-retaliation System . These ensure the strict confidentiality of whistleblower information and prohibit any form of discrimination or retaliation. During the reporting

period the Company added a "M&G Anti-Fraud" portal to its office software and sent monthly emails to all employees to promote awareness of the anti-fraud reporting channels. Colipu Group launched a dedicated WeChat official

account titled "Integrity Colipu" and included a "One-Click Reporting" portal within the account.M&G Anti-Fraud Reporting

Channels Hotline: 021-31820110 Email: mg110@mg-pen.com

Business Ethics Audit

In 2025

M&G annually conducts internal audits of its Code of Business Conduct covering 27 items including compliance with laws and regulations business

ethics fair competition and 18 key business processes such as sales procurement financial management and information systems management.By combining on-site checks with systematic sampling the Company has broadened its focus beyond basic fraud control and asset safety to cover The scope of internal business ethics audits covered

intellectual property product quality and information security thereby achieving full auditing of all business operations. For any risks identified during

audits the Audit Department promptly reports them to the relevant departments and actively tracks progress on improvements to ensure that each

department turns Business ethics rules into sound management practices. 22 operational sites

The coverage rate of the Company's operation process achieved

18. M&G's Management System Against Fraudulence has been publicly posted on the Company's website in the "Investor Relations - ESG - Reports and Policies" section.

19. For supplier-related anti-bribery and anti-corruption management please refer to the section "Supply Chain Management - Targets Management Measures and 100 %

Performance – Integrity in Procurement."Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 81

Building a Culture of Integrity and Compliance

M&G requires all new employees and key personnel at its headquarters and subsidiaries – including Colipu Group Jiumu Store and Axus Stationery –

to sign the Letter of Commitment on Integrity and Self-Discipline The "Code of Business Conduct" course is mandated as a prerequisite for onboarding

and all new employees who joined the Company during the reporting period have completed the training. The Company continues to conduct routine

business ethics training for all employees. In 2024 90% of full-time employees completed the Code of Business Conduct and Management System

Against Fraudulence courses via the online learning platform. In 2025 the coverage of these courses was further expanded to include employees in the

production operations and retail systems with the training coverage rate for the Code of Business Conduct increasing to 98%. Throughout the year

Colipu Group conducted 35 in-person integrity sessions covering all regional subsidiaries with a total of over 1000 participants. Colipu Group Integrity and Red Line Training

Case Anti-Corruption and Integrity-Themed Activities

Since 2024 M&G has held an annual summer integrity care campaign titled "Integrity

Accompanied Care Along the Way" advocating for employees to maintain high

personal standards and build a work culture based on integrity and fairness. This

year's event featured diverse interactive activities such as the "Instagrammable

the Integrity Tree" "Compliance Blind Boxes" and a call for "Outstanding Integrity

Works" and introduced the integrity mascot "Sunflower Police" along with a series of

goods. By blending learning with active tasks the event guided employees to deepen

their integrity awareness through hands-on work and public pledges. After the event

the outstanding integrity works remained on display further consolidating the

learning outcomes. The initiative was recognized by the Sunshine Integrity Alliance

and awarded the "Best Practice Award for Integrity Culture."

M&G received the "Best Practice Award for Integrity Culture" M&G's "Integrity Accompanied Care Along the Way" Activity

from the Sunshine Integrity Alliance.Case Colipu Group's Fun Integrity Awareness Campaign

On "International Anti-Corruption Day" Colipu Group hosted an "Integrity Personality

Quiz" for employees where participants could earn personalized integrity personality

tags and custom integrity-themed phone lanyards by answering questions. By using a

fun self-assessment as a starting point the activity made integrity education vivid and

relatable. In addition to offline interactions Colipu Group also conducts daily integrity

promotion and education through its official WeChat account "Integrity Colipu." By

publishing engaging content such as comics and scenario-based Q&As the account

helps more employees integrate integrity and compliance into their daily work and lives.Colipu Group's "Integrity Personality Quiz" EventForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 82

ESG Performance Board of Directors

Data20 Metric Unit 2023 2024 2025

Number of directors person 7 7 7

Number of independent directors person 3 3 3

Governance Performance

Attendance rate of directors at annual board meetings % 100 100 100

Rate of directors by age

≤ 30 years % 0 0 0

30-50 years % 14 14 0

≥ 50 years % 86 86 100

Rate of directors by gender

Male % 86 86 86

Female % 14 14 14

Business Ethics

Metric Unit 2023 2024 2025

Number of operational sites audited for business ethics unit 22 22 22

Rate of operational sites covered by business ethics audits % 100 100 100

Anti-Bribery and Anti-Corruption21

Metric Unit 2023 2024 2025

Number of public legal cases regarding bribery and corruption

brought against the company or its employees case 0 0 0

Total number of employees participating in anti-bribery and anti-

corruption training person 2364 2868 4513

Percentage of directors receiving anti-bribery and anti-corruption

20. Unless otherwise stated the 2025 ESG performance data scope encompasses training

%100100100

M&G and its subsidiaries. The newly constructed plant at M&G's Central China

Base officially commenced production in 2025 and has been included in this Percentage of personnel receiving anti-bribery and anti-corruption training by position level

year's data statistics.

21. The 2024 reporting scope for Anti-Commercial Bribery and Anti-Corruption Non-management staff % / 85 78

included includes M&G Jiumu Store More-Than-Fun (Qizhihaowan) and

Colipu Group. In 2025 the scope was expanded to encompass M&G and its Management % / 60 95

subsidiaries; as a result the reported figures show corresponding variations.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 83

Environmental Performance22 Environmental Investment

Metric Unit 2023 2024 2025

Environmental investment RMB10000 239 594 439

Energy23

Metric Unit 2023 2024 2025

Gasoline ton 89 59 58

Diesel ton 414 418 257

22. To enhance data comparability this Report has adjusted the units for intensity- Liquefied petroleum gas ton / 40 43

related indicators in the environmental performance section have been 24

adjusted from "/Million RMB of Revenue" to "/RMB10000 revenue." Historical Natural gas cubic meter / 189421 568510

data for previous years has been synchronously converted and restated to

maintain consistency. Steam ton / 29102 21554

23. The 2025 Energy data reporting scope includes the M&G Shanghai base the 25

Shanghai Headquarters Office Building the South China Base the North China Purchased electricity kWh 92582027 102087954 95898455

Base the Central China Base Axus Stationery Colipu Group and Jiumu Store

(directly operated stores). This year the Company re-calibrated the thermal Renewable energy consumption kWh 13222559 21603572 26079349

energy content (enthalpy value) of steam. Given that steam was a newly added

energy category since 2024 the corresponding energy consumption and GHG Percentage of renewable energy electricity consumption of total % 12 17 21

emission data for 2024 have been restated in this Report to ensure the accuracy electricity consumption

of historical data.

24. In 2025 due to process improvements at Axus Stationery and the addition of Direct energy consumption tce 870 993 1223

new heat press machines natural gas consumption increased compared to the

previous year. Indirect energy consumption tce 13003 17883 16977

25. In 2025 the accounting methodology for purchased electricity at Jiumu Srore's

directly operated stores was upgraded from historical sampling estimates to Total energy consumption tce 13873 18876 18200

survey statistics based on actual utility bills ensuring a more accurate reflection

of real consumption. As this change cannot be applied retroactively to previous of which: clean energy consumption tce 1625 2655 3205

years the 2025 purchased electricity data and the corresponding Scope 2 GHG

emissions disclosed in this Report are not fully comparable with historical data. Total energy consumption intensity tce/RMB10000 0.006 0.008 0.007

26. The 2025 GHG emissions data reporting scope includes M&G Shanghai base revenue

Shanghai headquarter office building the South China base the North China

base the Central China base Axus Stationery Colipu Group and Jiumu Store

(directly operated stores). In both 2024 and 2025 the Company procured 26

green electricity. To enhance data rigor this Report calculates and discloses GHG Emissions

Scope 2 GHG emissions for these two years using both the "location-based"

and "market-based" methods with a restatement of the 2024 data.The grid Metric Unit 2023 2024 2025

emission factors used for 2024 and 2025 are derived from the Announcement

on the Release of 2022 Electricity CO2 Emission Factors (issued Dec 26 2024) Scope 1 GHG emissions tCO2 e 2115 2393 2612

and the Announcement on the Release of 2023 Electricity CO2 Emission Factors

(issued Dec 31 2025) by the Ministry of Ecology and Environment respectively. Location-based scope 2 GHG emissions tCO e 45940 61346 56486

Additionally in compliance with the Notice on Further Optimizing the Electricity 2

and Heat Emission Factors Applicable to the Shanghai Carbon Emission Trading

Market issued by the Shanghai Municipal Bureau of Ecology and Environment Market-based scope 2 GHG emissions tCO2 e / 60327 55934

on Jan 16 2026 the electricity emission factors for the Shanghai region for 2024

and 2025 have been adjusted accordingly. The "Total GHG Emissions (Scope 1 Total GHG emissions (scope 1 and 2) tCO2 e 48055 62720 58546

and 2)" in this Report are calculated using the market-based method remaining

consistent with the methodology used for setting the Company's Scope 2 GHG emission intensity tCO2 e/RMB10000 revenue 0.021 0.026 0.023

emission reduction targets.

27. GHG emission reductions and investment for GHG emission reductions are GHG emissions reductions27 tCO2 e / / 11021

newly added metrics for 2025. As historical data for these indicators is not

retroactively traceable figures for 2023 and 2024 are not disclosed in this Investment for GHG emission reductions RMB10000 / / 424

Report.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 84

Materials28

Metric Unit 2023 2024 2025

Total material usage ton 58019 61708 57083

of which plastic ton 23286 23648 18400

paper ton 28887 31425 33466

ink ton 3114 3124 2974

wood ton 495 1760 970

pencil lead ton 2247 1751 1273

Material usage intensity ton /RMB10000 revenue 0.025 0.025 0.022

Packaging Materials29

Metric Unit 2023 2024 2025

Carton usage unit / / 37811979

Total count of reused cardboard boxes unit / / 2246492

Water Resources30

Metric Unit 2023 2024 2025

Total water consumption ton 570185 588923 461589

Water intensity ton/RMB10000 revenue 0.24 0.24 0.18

Recycled and reused water ton 49772 38851 53923

Waste and Wastewater31

28. The 2025 Materials data reporting scope includes M&G Jiumu Store and Axus

Stationery. Metric Unit 2023 2024 2025

29. To ensure data accuracy the reporting basis for cardboard box consumption

and the total volume of reused boxes was adjusted from weight to units in 2025. Total solid waste ton 663 5951 5949

As the historical data for these indicators is incomparable with the new metric

figures for 2023 and 2024 are not disclosed in this Report. of which hazardous waste ton 29 22 20

30. The 2025 Water Resources data reporting scope includes the M&G Shanghai

base the Shanghai headquarters office building the South China base Axus

Stationery and the Central China base. general solid waste (non-hazardous) ton 634 5929 5929

31. The reporting scope of Waste and Wastewater data for 2023 includes the M&G

Shanghai base; the scope for 2024 adds the South China base and North Solid waste intensity ton/RMB10000 revenue 0.0003 0.003 0.002

China base; and the scope for 2025 adds the Central China base. This year

the Company optimized its waste statistical methodology. To ensure data Amount of recycled and reused waste ton / 5212 5222

comparability the figures for total solid waste general solid waste (non-

hazardous waste) and recycled waste for 2024 have been restated in this Wastewater discharge ton 1876 2413 2252

Report..Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 85

Social Performance Employee Hiring

Metric Unit 2023 2024 2025

Total number of employees person 5839 5549 5503

Number of employees by age

Under 30 years old person 2080 1833 1738

30–50 years old person 3311 3279 3370

Over 50 years old person 448 437 395

Number of employees by educational background

Bachelor's (college) degree or above person 3621 3659 3766

High school vocational school person 964 618 724

Other person 1254 1272 1013

Number of employees by position level

Non-management person 4506 4277 4222

Management person 1333 1272 1281

Total number of employees on parental leave person 78 142 206

Number of employees on parental leave by gender

Male person 28 62 110

Female person 50 80 96

Ratio of basic salary and compensation for male employees32

Basic salary % 66 77 81

Additional compensation % 34 23 19

Ratio of basic salary and compensation for female employees

Basic salary % 77 82 83

Additional compensation % 23 18 17

Percentage of vacancies filled by internal candidates (internal recruitment)33 % 20 33 35

New employee ratio % / 14.2 13.1

32. The 2025 Ratio of basic salary and compensation for employees data reporting

scope includes M&G Jiumu Store and More-Than-Fun (Qizhihaowan). Employee turnover rate % 11.9 16.5 16.7

33. The 2025 Percentage of vacancies filled by internal candidates (internal

recruitment) data reporting scope includes M&G Jiumu Store and More-Than- Percentage of employees covered by the trade union % 100 100 100

Fun (Qizhihaowan).Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 86

Employee Training34

Metric Unit 2023 2024 2025

Employee training coverage rate35 % / / 85.6

Percentage of employees trained by gender

Male % / / 83.8

Female % / / 87.4

Percentage of employees trained by position level

Non-management % / / 81.4

Management % / / 99.4

Average training hours per capita hour 11.8 14.6 11.4

Investment annual training RMB10000 / 205 304

Performance Assessment

Metric Unit 2023 2024 2025

Percentage of employees receiving regular performance assessment % 100 100 100

Occupational Health and Safety36

Metric Unit 2023 2024 2025

Percentage of workers covered by occupational health and safety management system % 100 100 100

Fatalities caused by work-related injuries case 0 0 0

Rate of fatalities caused by work-related injuries % 0 0 0

Severe work-related injuries (excluding fatalities) case 0 0 0

Severe work-related injury rate (excluding fatalities) % 0 0 0

Recordable work-related injuries case 21 69 46

Recordable work-related injury rate (per million working hours) / 5.8 3.6 2.5

Total safety training hours hour 20220 25489 23840

Total number of employees who received safety training person 202020 230035 221300

34. The 2024 reporting scope for Employee Training included M&G Jiumu Store

More-Than-Fun (Qizhihaowan) Colipu Group and Axus Stationery. In 2025 the Investment in labor protection RMB10000 208 274 245

scope was expanded to encompass M&G and its subsidiaries; as a result the

reported figures show corresponding variations.

35. Due to adjustments in the scope of Employee Training data for 2025 and

since this change cannot be applied retroactively to previous years' data Products and Services

the "Employee training coverage rate" "Percentage of employees trained by

gender" and "Percentage of employees trained by position level" aredisclosed Metric Unit 2023 2024 2025

2025 only in this Report .

36. The 2024 Occupational Health and Safety data reporting scope included the Number of health and safety violations related to products and services case 1 0 0

M&G Shanghai base the South China base and Axus Stationery; the Central

China base was added in 2025. Starting in 2024 the reporting scope includes Customer satisfaction by average satisfaction score score 83.5 92.2 90.9

both regular and non-regular employees. Completion rate of after-sales problem implementation % / 99.8 99.4Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 87

Intellectual Property and Technological Innovation

Metric Unit 2023 2024 2025

Technological improvement innovation and R&D investment RMB10000 17752 18915 18964

Number of R&D personnel % 0.8 0.8 0.8

Number of patent filings during the year person 503 467 450

Number of invention patent filings item 212 290 309

Number of patents granted during the year item / 20 25

Number of invention patents granted item 148 229 231

Number of valid patents item / 8 5

Cumulative patent filings item 1211 1336 1488

Cumulative patents granted item 2612 2901 3212

Number of R&D personnel item 2407 2625 2868

Supply Chain Management37

Metric Unit 2023 2024 2025

Number of suppliers participating in ESG audit during the year number 71 85 97

Percentage of key suppliers participating in ESG audit during the year % 100 100 100

Number of assessed suppliers with substantial actual/potential negative impacts number 6 1 0

Charity and Public Welfare38

Metric Unit 2023 2024 2025

Total investment in rural revitalization39 RMB10000 / / 630

Number of people benefiting from rural revival person / / 811000

37. The 2025 Supply Chain Management data reporting scope includes M&G.

38. The 2025 Charity and Public Welfaredata reporting scope includes M&G Charity Total cash donations RMB10000 303 311 386

Colipu Group Jiumu Store and Axus Stationery.

39. "Total investment in rural revitalization" and "Number of people benefiting Total in-kind donations RMB10000 305 533 774

from rural revitalization" are new metrics disclosed in 2025. As historical data

for these indicators cannot be retrieved retroactively the data for 2023 and Number of participants in volunteer services40 person 3778 4435 1196

2024 has been omitted from this Report.

40. In 2025 public welfare activities focused on deeper employee involvement Volunteer service hours hour 5730 9221 4946

which led to fewer participants than in 2024.Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 88

Independent Assurance StatementForeword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 89

Index of Indicators Dimension Corresponding Clause Topic Report Page Number or Explanation

Articles 21 to 28 Response to climate change 06-11; 29-39; 83; 88

Article 30 Pollutant discharge 06-11; 40

The SSE Sustainability Article 31 Waste management 06-11; 41; 84

Report Guidelines Article 32 Ecosystem and biodiversity protection 06-11; 43-44Environment

Content Index Article 33 Environmental compliance management 06-11; 40; 84

Article 35 Energy utilization 06-11; 36-38; 83; 88

Article 36 Water resources utilization 06-11; 42; 84

Article 37 Circular economy 06-11; 20-21; 41; 84; 88

Article 39 Rural revitalization 06-11; 72-74; 87

Article 40 Social contributions 06-11; 72-74; 87

Article 42 Innovation-driven development 06-11; 46-49; 87

Since M&G did not engage in sensitive fields such as life

Article 43 Ethics of science and technology sciences or AI during the reporting period therefore this

topic is not applicable

Article 45 Supply chain security 06-11; 50-53; 87-88

Society Since M&G did not have any instances during the reporting

period where accounts payable (including notes payable)

Article 46 Fair treatment of small and medium- accounted for more than 50% of total assets nor any sized enterprises outstanding unpaid information regarding payments to

small and medium-sized enterprises (SMEs) therefore this

topic is not applicable

Article 47 Product and service safety and quality 06-11; 22-28; 86

Article 48 Data security and customer privacy protection 06-11; 57-58

Article 50 Employees 06-11; 59-71; 85-86; 88

Article 52 Due diligence 09-11; 52; 79-80;

Sustainability- Article 53 Stakeholder communication 06-12; 77; 88

related

governance Article 55 Anti-commercial bribery and anti-corruption 06-11; 80-82;

Article 56 Anti-unfair competition 06-11; 79; 82Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 90

GRI Standards (2021) Usage Notes: M&G Stationery has reported the information cited in this GRI content index for the period January 1 2024 to December 31 2024 with reference to the GRI Standards.Content Index GRI 1 Used: GRI 1: Foundation 2021

GRI Standard Disclosure Pages

2-1 Organizational details 01

2-2 Entities included in the organization's sustainability reporting 01

2-3 Reporting period frequency and contact point 01

2-4 Restatements of information 82-87

2-5 External assurance 88

2-6 Activities value chain and other business relationships 03-04;12

2-7 Employees 85-86

2-8 Workers who are not employees 50-53

2-9 Governance structure and composition 08;76

2-10 Nomination and selection of the highest governance body 77

2-12 Role of the highest governance body in overseeing the management of impacts 02;08;76-77

2-13 Delegation of responsibility for managing impacts 08;76-77

2-14 Role of the highest governance body in sustainability reporting 08

GRI 2: General Disclo- 2-15 Conflicts of interest 08;79-81

sures 2021

2-16 Communication of critical concerns 08

2-17 Collective knowledge of the highest governance body 08

2-18 Evaluation of the performance of the highest governance body 08

2-19 Remuneration policies 76-77

2-20 Process to determine remuneration 76-77

2-22 Statement on sustainable development strategy 06-07

2-23 Policy commitments 12;52;67-71;79-80;

2-24 Embedding policy commitments 08;79-81;

2-25 Steps to Ease Possible Effects 70;80

2-26 Ways to Seek Help and Share Concerns 70;80

2-27 Compliance with laws and regulations 23;40;43;57;60;63;79;82;86

2-28 Membership associations 56

2-29 Approach to stakeholder engagement 12Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 91

GRI Standard Disclosure Pages

3-1 Process to determine material topics 09

GRI 3: Material Topics

2021 3-2 List of material topics 09

3-3 Management of material topics 09-11;13-81

101-1 Policies to halt and reverse biodiversity loss 43-44

GRI 101: Biodiversity 2024 101-2 Management of biodiversity impacts 43-44

101-4 Identification of biodiversity impacts 43

GRI 201: Economic Per- 201-1 Direct economic value generated and distributed 03

formance 2016 201-2 Financial implications and other risks and opportunities due to climate change 31-32

GRI 202: Market Presence

2016 202-1 Ratios of standard entry level wage by gender compared to local minimum wage 63

GRI 205: Anti-Corruption

2016 205-2 Communication and training about anti-corruption policies and procedures 81-82

GRI 206: Anti-competitive

Behavior 2016 206-1 Legal actions for anti-competitive behavior anti-trust and monopoly practices 52;79-82

301-1 Materials used by weight or volume 84

GRI 301: Materials 2016

301-2 Recycled input materials used 41;84

302-1 Energy consumption within the organization 36-38;83;88

GRI 302: Energy 2016 302-3 Energy intensity 36-38;83;88

302-4 Reduce of energy consumption 36-38;83;88

303-1 Interactions with water as a shared resource 42

GRI 303: Water and Efflu- 303-2 Management of water discharge-related impacts 42

ents 2018 303-4 Water discharge 84

303-5 Water consumption 84

305-1 Direct (Scope 1) GHG emissions 35;83

305-2 Energy indirect (Scope 2) GHG emissions 35;83

GRI 305: Emissions 2016 305-3 Other indirect (Scope 3) GHG emissions 35;83

305-4 GHG emissions intensity 35;83

305-5 Reduction of GHG emissions 83

306-1 Waste generation and significant waste-related impacts 21;41;84

306-2 Management of significant waste-related impacts 41

GRI 306: Waste 2020 306-3 Waste generated 84

306-4 Waste diverted from disposal 84

306-5 Waste directed to disposal 84Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 92

GRI Standard Disclosure Pages

GRI 308: Supplier Envi- 308-1 New suppliers that were screened using environmental criteria 51-52;87

ronmental Assessment

2016 308-2 Negative environmental impacts in the supply chain and actions taken 51-53

401-1 New employee hires and employee turnover 86

GRI 401: Employment 401-2 Benefits provided to full-time employees that are not provided to temporary or

2016 part-time employees 67-69

401-3 Parental leave 68;85

403-1 Occupational health and safety management system 60-62

403-2 Hazard identification risk assessment and incident investigation 60-62

403-3 Occupational health services 62

403-5 Worker training on occupational health and safety 62

GRI 403: Occupational 403-6 Promotion of worker health 60-62

Health and Safety 2018

403-7 Prevention and mitigation of occupational health and safety impacts directly

linked by business relationships 60-62

403-8 Workers covered by an occupational health and safety management system 86

403-9 Work-related injuries 86

403-10 Work-related ill health 62;86

404-1 Average hours of training per year per employee 86

GRI 404: Training and 404-2 Programs for upgrading employee skills and transition assistance programs 65-66

Education 2016

404-3 Percentage of employees receiving regular performance and career development

reviews 86

GRI 405: Diversity and 405-1 Diversity of governance bodies and employees 70-71;77

Equal Opportunities 2016 405-2 Ratio of basic salary and remuneration of women to men 85

GRI 413: Local Communi- 413-1 Operations with local community engagement impact assessments and develop-

ties 2016 ment programs 72-74;87

GRI 414: Supplier Social 414-1 New suppliers that were screened using social criteria 51-52;87

Assessment 2016 414-2 Negative social impacts in the supply chain and actions taken 51-53

416-1 Assessment of the health and safety impacts of product and service categories 22-26

GRI 416: Customer Health

and Safety 2016 416-2 Incidents of non-compliance concerning the health and safety impacts of products

and services 24-26

GRI 417: Marketing and

Labeling 2016 417-1 Requirements for product and service information and labeling 27-28;54-55

GRI 418: Customer Priva- 418-1 Substantiated complaints concerning breaches of customer privacy and losses of

cy 2016 customer data 57-58Foreword Focus Product Climate and Shared Prosperity Across Employees and Governance and Stewardship Environment the Value Chain Communities Integrity Appendix 93

Writing a Sustainable Business Future

Shanghai M&G Stationery Inc.Website: www.mg-pen.com

Address: No. 5 Lane 288 Qianfan Road Xinqiao Town Songjiang District Shanghai

Email: ESG@mg-pen.com