Satellite Chemical Co. Ltd.Stock code：002648
2024
Environmental Social and
Governance Report
Chemicals Make a Better LifeSatellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report CONTENTS
CONTENTS 02 About This Report 108 Appendices
108 Outlook
04 Message from our Chairman
109 Honors in 2024
06 About STL 110 Index of Reporting Guidelines
05 Company Profile 115 ESG Performance Indicators
08 Awards and Honors
01 Efficient Governance for Innovation to Foster an Dual Carbon Goals Building a Harmonious Society Steady and Long-Term Growth 02 Excellent Brand 03 for Green Development 04 with People at the Heart
12 Strengthening ESG Management 34 Empowering Development through 56 Focusing on Low-Carbon Strategies 84 Safeguarding Employee Rights and Benefits
Technology Innovation
15 Compliant and Stable Operations 64 Addressing Climate Change 92 Growing Together with Employees
44 High-Quality Products and Services
26 Strengthening Risk Prevention and Control 68 Strengthening Environmental Management 96 Robust Safety Practices
50 Advancing Responsible Procurement
79 Ecological Co-building 104 Fulfilling Corporate Social Responsibility
52 Promoting Industry DevelopmentSatellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report About This Report
About This Report
Description of This report is the fifth annual Environmental Social and Governance (ESG) report of Satellite Chemical Information The information and data disclosed in the Report are from the Company's statistical information
the Report Co. Ltd. (hereinafter referred to as "this report"). It provides a factual and objective overview of the or official documents. The currency amounts involved are measured by the Renminbi (hereinafter Company's sustainability activities in 2024 with a focus on its social environmental and governance Sources referred to as the "RMB").performance.Report Scope Reporting Period: January 1 2024 to December 31 2024 (hereinafter referred to as the "reporting The Report was prepared by STL's ESG report drafting team and approved for release by the
period"). Some information may extend beyond this period. This report is an annual report. Confirmation
and Approval Board of Directors on March 24 2025 upon confirmation by the management.Organizational Scope: This report covers Satellite Chemical Co. Ltd unless otherwise specified.Basis of This report is prepared with reference to the Shenzhen Stock Exchange Guide No.1 on Self-
Regulation of Listed Companies: Standardized Operation of Companies Listed on the Main Board Disclaimer The forward-looking statements in this report other than statements of historical facts
Preparation (Revised in December 2023) the Shenzhen Stock Exchange Guideline No.1 on Self-Regulation are those concerning the Company's anticipated or expected business activities events or
of Listed Companies: Business Matters (Revised in 2023) Shenzhen Stock Exchange Guide developments that may occur or are expected to occur in the future. Actual results or trends in
No.17 on Self-Regulation of Listed Companies: Sustainability Reporting (Trial) and Guide No.3 the future may differ materially from these forward-looking statements as a result of a range
on Self-Regulation of Listed Companies No.3: Sustainability Reporting Preparation Enterprise of variables. The Company made the forward-looking statements contained in this report
Sustainability Disclosure Standards: Basic Guidelines (Draft for Comments) issued by the prior to March 24 2025 and undertakes no obligation or duty to update them unless otherwise
Ministry of Finance the GRI Standards issued by the Global Reporting Initiative (GRI) the IFRS required by regulatory authorities.Sustainability Standards Standard 1: General Requirements for Disclosure of Sustainability-
related Financial Information and IFRS Sustainability Standards 2: Climate-related Disclosures
published by the International Sustainability Standards Board (ISSB) the United Nations Access and The Report is available in both simplified Chinese and English. In case of discrepancies
Sustainable Development Goals (UN SDGs) Climate-related Financial Disclosure Guidelines Feedback between the two versions the simplified Chinese version shall prevail.issued by the Task Force on Climate-related Financial Disclosures (TCFD) the MSCI ESG Rating
Methodology for Commodity & Diversified Chemicals Industry and the China Enterprise We value the opinions of all parties and welcome readers to contact us in the following ways.Sustainability Reporting Guidelines (CASS-ESG 6.0). Your comments are valuable to us and will help us improve our ESG performance.Description of For ease of presentation and reading the terms "the Company" "Satellite" "STL" and "we/us"
Designations in this report refer to "Satellite Chemical Co. Ltd." and its subsidiaries. Other definitions are as follows:
Telephone (86)573-8222 9096
STL Technology refers to Zhejiang Satellite New Material Technology Co.Ltd.Youlian Chemistry refers to Zhejiang Youlian Chemistry Industry Co.Ltd.E-mail esg@weixing.com.cn
Pinghu Petro Chemical refers to Pinghu Petro Chemical Co. Ltd.Satellite Energy refers to Zhejiang Satellite Energy Co. Ltd.Lianyungang Petrochemical refers to Lianyungang Petrochemical Co. Ltd. Official website https://www.stl-chem.com
Jiahong New Material refers to Jiangsu Jiahong New Material Co. Ltd.Satellite Global refers to Satellite Global Chemical (Shanghai) Co. Ltd.No. 196 Fuqiang Road Nanhu District Jiaxing Zhejiang
Satellite Industrial refers to Zhejiang Satellite Chemical Industrial Co. Ltd. Address Province China
Jiaxing Base refers to the Company's production facilities in Jiaxing Science and Technology City
Pinghu Base refers to the Company's production facilities in Dushan Port Pinghu
Postal Code 314050
Lianyungang Base refers to the Company's production facilities in Xuwei New District Lianyungang
02 03Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Message from our Chairman
Message from our Chairman
This year we refined our management practices and Advancing Green Development: Low-Carbon Industrial
ensured compliant operations to safeguard the Company's Models for a Sustainable Future
steady and long-term growth. We actively respond to China's "carbon peaking and carbon
We continuously optimized corporate governance actively neutrality" strategy by deepening the implementation
The year 2024 is a crucial year for fully responded to the new "Nine National Guidelines" upheld of the "4R" green development model and increasing
implementing the guiding principles of the compliance principles strengthened our governance investment in projects related to "dual carbon" goals
20th National Congress of the Communist Party framework and established a robust internal control and clean technologies driving the lightweighting of
of China and a pivotal year for advancing the management system. These efforts enhanced our core petrochemical raw materials and promoting green and
"14th Five-Year Plan" development strategy. competitiveness and comprehensive risk management low-carbon development. As one of the country's first
capabilities providing strong protection for shareholders' "Green Champion Enterprises" we are committed to a
Against the backdrop of transformation and legitimate rights and interests. We remained committed sustainable development path that is green low-carbon and
reconstruction with both opportunities and to business ethics reinforced anti-corruption measures circular. By leveraging technological innovation to enhance
challenges coexisting STL remains committed and maintained open communication channels with all environmental value we continuously explore energy-
to its mission of "Chemicals Make a Better stakeholders fully integrating ESG principles into corporate saving consumption-reducing quality-improving and
Life." The Company continues to deepen its governance to maximize economic environmental and social efficiency-boosting initiatives. We implement technological
strategies of "Management Leadership" and benefits while injecting fresh momentum into high-quality improvements strengthen emissions management
"Technology Leadership" fully integrating the development with new productive forces. In 2024 we were participate in biodiversity and ecological protection efforts
principles of new development concepts and the recognized among the Top 100 Most Valuable Main Board and minimize the environmental impact of our production
requirements of a new development paradigm Listed Companies the Fortune China 500 Zhejiang's Top 100 and operations in order to achieve a win-win balance
into its innovation research and production Enterprises Zhejiang's Top 100 Manufacturing Enterprises between economic growth and environmental benefits. In
practices in light hydrocarbon utilization and Zhejiang's Fastest-Growing Top 100 Enterprises and Jiaxing's 2024 we were selected for both the Excellent Practice Cases
Top 100 Private Enterprises. Additionally we were included of Sustainable Development for Chinese Listed Companies
green chemical materials. STL steadfastly in the Shenzhen 100 Index continuously striving for higher and the Top 100 list of ESG Performance for Zhejiang Listed
pursues a green low-carbon and sustainable achievements and embracing innovation on our path forward. Companies.development path focusing on the continuous
innovation in functional chemicals advanced
polymer materials new energy materials Pioneering Innovation: Technology-Driven Growth with New Fulfilling Responsibility: Talent Development to Drive
hydrogen energy and carbon dioxide utilization. Development Momentum Social Inclusion
By driving the industrial chain toward intelligent We remain committed to an innovation-driven development We are committed to providing a fair inclusive and diverse
sustainable and high-end development the strategy continuously increasing R&D investment and work environment with opportunities for growth. Prioritizing
Chairman of STL —— Yang Weidong Company is forging a new chapter in high-quality advancing the construction of our future research center. employee well-being and rights protection we foster
growth. By aligning with national strategic directions and industry innovation and creativity through incentive mechanisms
development needs we are building innovation platforms that drive continuous talent development and progress. We
to tackle key challenges in high-performance catalysts new align business growth with social responsibility actively
energy materials advanced polymer materials and functional addressing societal needs and fulfilling our corporate duties.chemicals. Through continuous efforts to extend strengthen Through our corporate-sponsored charitable foundation we
and optimize our industrial chains we are accelerating organize philanthropy projects and volunteer services. Our
projects such as high-end polyolefin materials high-end efforts were recognized with the ESG Action Award for "Rural
packaging materials and comprehensive hydrogen energy Revitalization and Social Development" contributing to
utilization. These initiatives add additional industrial value advancing rural revitalization and shared prosperity.and market competitiveness.We have seen great accomplishments in the past year and
We deeply understand customer needs providing customized a new chapter now awaits. STL will continue to focus on
solutions while actively expanding domestic and international its core responsibilities and businesses seizing strategic
markets. Through strengthening cooperation and exchanges opportunities by focusing on the development direction
with upstream and downstream enterprises we foster of "establishing new productive forces". The Company
strategic partnerships and industry collaboration to drive high- will leverage "Green and Low-carbon" and "Technological
quality development in the petrochemical sector building Innovation" as dual engines to build an integrated green
new growth pillars in the modernization process. In 2024 we industr y chain star ting from the clean raw materials
were recognized among the Top 100 New Materials Enterprises stage. We will continuously meet the needs of strategically
in China the Forbes China 50 Most Innovative Companies the emerging industries and people's growing demand for a
Annual Provincial 5G Fully Connected Factory List， and 2024 greener and higher quality life leading towards a moreZhejiang Province Artificial Intelligence Application Scenarios. sustainable future.
04 05Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report About STL
About STL
Company Profile
About the Company
Satellite Chemical Co. Ltd. was established in 1992 and listed on the
Shenzhen Stock Exchange in December 2011 (Stock Code: 002648).The Company possesses a domestically leading light hydrocarbon
integrated industrial chain and has established an independently
controllable global light hydrocarbon supply chain. It utilizes green
technologies to produce functional chemicals advanced polymer
materials and new energy materials while comprehensively
harnessing carbon dioxide and hydrogen energy. The Company's
products are applied across vital national and civilian industries
including aerospace automotive electronic semiconductors
healthcare nutrition and personal care sports and fitness
construction engineering and ecological environment. This
aligns with the national petrochemical industry's direction toward
lightweight feedstock and contributes to achieving the country's
"dual carbon" goals. The Company continuously promotes the "4R"
green development concept and has been winning honors including The Company has now established Corporate Culture
National Manufacturing Champion Example Enterprise National a strategic layout consisting of one
Green Supply Chain Management Enterprise National Green headquarters and three major bases. STL has cultivated a corporate culture with "synergy"
Factory Key National Industry Energy Efficiency "Pacesetter" and as the core value. The Company maintains Custom-
Key National Water-Using Enterprises Water Efficiency "Pacesetter". er-Centric Perseverance and Hard Work Continuous
The Jiaxing Base Improvement uniting like-minded individuals to Vision
has been developed into a high-value- collectively pursue the corporate vision. Under the
Business Layout added advanced polymer materials requirements of "Management Leadership" and
Dedicated to becoming a world-leading
industrial cluster "Technology Leadership" the Company strives to technology enterprise in advanced chemical
deliver product excellence and brand distinction materials
Satellite Chemical has established two integrated industry chains aiming to become an enterprise respected by society
centered around green low-carbon raw materials - C2 and C3. The The Pinghu Base and a source of pride for employees. STL is dedicated
Company focuses on developing products including polyethylene has been built into a C3 integrated industry to becoming a world-leading technology enterprise
polypropylene polyolefin elastomers (POE) superabsorbent polymers chain using propane as a raw material in advanced chemical materials positioning itself
(SAP) acrylic acid and esters and hydrogen peroxide forming three among the global chemical industry leaders.major sectors: functional chemicals new energy materials and high-
performance polymer materials. STL is the first domestic Company The Lianyungang Base The Company continuously advances people's Mission Core Value
to establish ethane export facilities overseas successfully opening pursuit of a happy and beautiful life. We consistently has been developed as a new materials
China's first global ethane supply chain while introducing clean raw generate tax revenue for the regional economy cre- Chemicals make Customer-Centric industry chain utilizing diversified raw
materials to build domestic ethane cracking process facilities forming ate profits for investors and provide income for em- a better life Perseverance and Hard Work materials
an integrated C2 industry chain. Additionally STL is the first domestic ployees promoting high-quality social and economic Continuous Improvement
enterprise to build and introduce Propane Dehydrogenation (PDH) development and advancing common prosperity.facilities using American UOP technology establishing an integrated The Company has developed a "seven-quality" Through the coordination of upstream
C3 industry chain. In recent years STL has deepened its efforts in cadre team characterized by having: cultural belief and downstream industry chains
advancing "Management Leadership" and "Technology Leadership" strategic vision responsible commitment resilient the Company has constructed a sustainable
relying on technological innovation and modern enterprise system determination learning and innovation capabilities development ecosystem.construction to continuously maintain the market competitiveness of outstanding performance and professional stand-
its industry chains and products. ards.
06 07Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report About STL
Awards
and Honors
Industry Leadership Innovation Leadership
Inclusion in the Shenzhen 100 Index Value Companies Listed Forbes China's 50 Most Innovative National 2023 Industrial Internet Pilot
on the Main Board Companies Demonstration 5G Factory
Shenzhen Stock Exchange Shenzhen
Securities Information Co. Ltd. Securities Times Forbes China Ministry of Industry and Information
Technology of the People's Republic of China
Selected for Zhejiang's Second Included in the "2024 Zhejiang Artificial
China's Top 100 New Materials Companies Batch of "Eagle Enterprises" Intelligence Application Scenarios List"
Hurun Research Institute Zhejiang Provincial Department Zhejiang Provincial Department
of Economy and Information of Economy and Information
Technology Technology
ESG Leadership
First Batch of "Green Leading Enterprises" Outstanding Sustainable Guoxin Cup * ESG Golden Bull Award Aona Award for Enterprises
(Subsidiary Lianyungang Petrochemical Development Practice Case for with Sustainable Development
received this award) Listed Companies China Securities Journal China Contribution
Reform Holdings Nantong
China Quality Certification Center China Association for Public Companies Municipal Government Social Responsibility Conference
Organizing Committee
Zhejiang's Top 100 ESG
Performance Listed Companies CSR China Top 100
China Enterprise ESG "Golden
Responsibility Award" Outstanding Sustainable
– Best Responsibility Progress Award Development Enterprise of the Year
Zhejiang Corporate Social Responsibility Responsibility 100
Promotion Association CCXGF CSR China Education Award Sina Finance EY Greater China
"Rural Revitalization and Social Cailian Press Zhiyuan Award -
Development" ESG Action Award Environmental (E) Pioneer KPMG China's Second ESG · 50 List
Enterprise Award – Outstanding Social Pioneer
Responsibility 100
CSR China Education Award Cailian Press KPMG
08 0901 Efficient Governance for Steady and Long-Term Growth
STL regards efficient governance as the cornerstone of its high-quality development. The Company continuously enhances its
corporate governance levels and risk prevention capabilities upholding business ethics to ensure stable operations. Additionally
the Company places great emphasis on the quality of information disclosure further advancing its modern governance system.By sharing development achievements with stakeholders and integrating ESG principles into all aspects of its operations STL
empowers its sustainable growth.Governance STL has established a "Three-Tier Governance Structure (Board Committees Executive Management)"
governance framework ensuring a clear division of ownership decision-making supervision and
operational responsibilities. In ESG governance the Company has implemented a three-level ESG
governance hierarchy comprising the Board of Directors - Strategy and ESG Committee - ESG Working Group
systematically driving the standardization and institutionalization of ESG initiatives.Strategy The Company deepens the "Management Leadership" strategy. By strengthening institutional frameworks
and optimizing processes STL addresses the "Five Key Management Questions" and implements "Four
Transformations" enhancing the depth breadth effectiveness precision and strength of corporate
management. By fostering institutional and systemic innovations the Company also ensures sustainable
and stable growth.Goals Internal policies publication rate reaches Enhancing information
80% disclosure quality and above
Optimizing investor relations market value Improving ESG performance
management and shareholder returns
100% integrity training coverage for all employees including interns outsourced staff
and part-time employees
Number of integrity training: Company-level ≥2 sessions
Audit and Supervision Department ≥8 sessions
Centers bases subsidiaries and business units ≥3 sessions each
0 critical system downtime incidents 0 customer data breaches
UN SDGs Impacts STL integrates risk prevention compliance management and internal controls into its governance framework
risks and focusing on the core business and key areas of operation and management. The Company systematically identifies risks in areas such as integrity information security procurement sales external investments
opportunities and guarantees reinforcing risk response mechanisms. Additionally it enhances interpretation and investor
communication on information disclosure ensuring timely and effective responses to concerns from the
investors. Systematic training for key management personnel was conducted to strengthen their compliance
awareness ensuring governance remains scientific stable and effective.Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Efficient Governance for Steady and Long-Term Growth
Strengthening ESG Management ESG Strategy
STL integrates sustainability responsibilities into its corporate development strategy actively implementing international and
national standards. The Company has established a key sustainable development indicator system tailored to its characteristics
ESG Management System and has built a closed-loop management system. By strengthening coordination between ESG responsibilities and departmental
operations and ensuring integration across all levels the Company continuously enhances its governance competitiveness
innovation and risk resilience promoting both corporate and broader economic and social sustainability.ESG Governance Structure
STL has established a top-down ESG management structure consisting of the Board of Directors the Strategy and ESG Committee ESG Risk and Opportunity Management
and the ESG Working Group to ensure the comprehensive execution and effective supervision of ESG responsibilities. The Board of STL promotes the identification and assessment of ESG risks in daily operations incorporating ESG responsibilities into the
Directors as the highest decision-making body is responsible for reviewing and overseeing the Company's ESG strategy policies business management decision-making system. At the same time the Company is committed to integrating ESG factors into
and progress towards goals. The Board of Directors authorizes the Strategy and ESG Committee to guide and supervise ESG investment decision-making comprehensively evaluating and adjusting relevant variables to optimize investment decision
governance work; identify and assess major ESG risks and opportunities; approve major ESG investments and budget expenses; models thereby achieving long-term and sustainable investment value.provide strategic advice; and supervise the advancement of ESG-related matters. The ESG Working Group composed of liaison
officers from various centers bases subsidiaries and business units is responsible for comprehensively following up on and The Company incorporates ESG indicators into the performance evaluation system for senior management which include but are
implementing all ESG-related work. not limited to key areas such as workplace safety (e.g. number of safety incidents safety-related penalties) energy conservation
and environmental protection (e.g. greenhouse gas emissions pollutant emissions energy efficiency management environmental
penalties) and labor rights protection. Each indicator is assigned a specific weight and performance evaluation scores determine
the final rating. Performance-related pay is then calculated based on these scores and ratings. The ESG performance assessment
is directly linked to the salary of senior management responsible for ESG matters. If ESG targets are not met the corresponding
assessment score is deducted with up to 35% of the total performance score deducted. Additionally in the event of a zero-
Board of Directors Strategy and ESG Committee ESG Working Group tolerance incident a "veto" policy is enforced to ensure the strict implementation of ESG governance. Regarding executive
Overall planning oversight Management guidance Coordination compensation clawback mechanisms the Company has established a penalty system for violations. The performance of board
and decision-making and advancement and execution members and senior executives is assessed and differentiated penalties are set to align responsibility with risk. This ensures that
Review and decide on the Authorizes Provide input on the Company's Guides Coordinate and drive the executive decisions and actions remain consistent with the Company's long-term interests and compliance requirements. The
Company's sustainability ESG strategy implementation of ESG remuneration plan for all directors including executive ones must be reviewed by the Board of Directors and approved by the Ge
strategy and goals Identify and assess key ESG risks efforts across the Company neral Meeting of Shareholders through voting before implementation.Oversee and review ESG-related Reports to and opportunities Reports to Manage ESG risks in daily
policies and monitor progress Review and approve major ESG- operations
toward goals related investments and budget Prepare the ESG report
Approve the Company's ESG allocations Handle other ESG-related
report and related disclosures Establish the ESG goals matters
Review and confirm the evaluation system
Company's ESG-related risks Reviews the Company's ESG report
and materiality issues and provide recommendations
STL ESG Governance Structure
The three-tier ESG governance framework covers the following areas
Protection of Protection of Environmental Protection Public
Shareholder and Protection of Employee Rights Customer Supplier and Sustainable Relations and Creditor Rights and Partner Rights Development Social Welfare
Ensuring financial Strictly complying with Adhering to ethical Implementing the "dual Actively participating
stability and transparent labor laws safeguarding business practices carbon" strategy promoting in social welfare
information disclosure employee health and enhancing product green production and initiatives fulfilling
by improving governance safety and establishing quality and services resource conservation corporate citizenship
structures and treating comprehensive and building a green and strengthening responsibilities
shareholders and compensation benefits low-carbon and environmental and contributing to
creditors fairly and career development compliant supply management (including societal prosperity
systems chain ecosystem strategies and performance and sustainable
on energy usage water development
resource management and
waste management)
12 13Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Efficient Governance for Steady and Long-Term Growth
Stakeholder Communication Compliant and Stable Operations
STL highly values communication with stakeholders and has established multi-channel engagement mechanisms to actively
address and respond to their opinions and concerns. To ensure smooth and transparent communication the Company conveys Material Topic Analysis 01 Basic Information 02 Development of the Material
its value externally through earnings presentations call conferences on earnings interpretation investor research sessions Analysis Topics Library
responses to inquiries on the interactive platform participation in strategy sessions and institutional reverse roadshows. STL conducts at least one material STL conducts a comprehensive review Based on the Company's business development
Internally the Company listens to voices and suggestions through employee forums employee representative meetings the topic identification and analysis of the Company's business activities strategy and unique characteristics STL
chairman's mailbox and an employee supervision and suggestion hotline. The Company also focuses on key topics of interest to annually reviewing changes and trends and commercial relationships while identifies 23 ESG material topics closely related
stakeholders strengthening relevant management practices and striving to create value for all parties. in industry policies and internal and considering external objective factors to the Company through industry benchmarking such as policies regulations and analysis external policy research and industry
external environments. The Company industry trends to define the research trend investigations to establish a material
Stakeholders Key Concerns Communication Methods Key Topics STL Response evaluates topics from both "financial objectives and scope. topics library.* General Meetings * Continuous Performance Growth * Transparent and Accurate significance" and "impact significance"
* Corporate Governance * Investor Research * Stable Future Development Outlook * Information Disclosure
Shareholders * Risk Management * Hotline * Shareholder Rights Protection * Performance Improvement
dimensions. Through online 03 Stakeholder 04 Disclosure and Review of the
* Sustainable Operations * Company * Standardized Corporate Governance and Profit Growthand Investors questionnaires internal and external
Engagement Materiality Matrix
* Business Ethics * Announcements * Enhanced Information Disclosure * Diversified Investor* Earnings Briefings * Smooth Investor Communication * Communication Channels stakeholders are invited to assess STL establishes a framework linking STL conducts statistical analysis on the scores
* Emails * Improved ESG Performance * Optimized ESG Performance these topics helping to define the impact significance and financial of each topic evaluates them from the two
Company's sustainable development significance compiles an online dimensions of "financial significance" and
* Climate Change Response
* Energy Management priorities. This process enables the ESG material topics assessment "impact significance" to form a materiality
* Pollution Emission Company to effectively respond to questionnaire and collects stakeholder matrix which is reviewed and approved by the
and Waste Management * Compliance with National Laws * Legal Compliance recommendations for the Company's Board of Directors to determine key disclosure
Government * Water Resource * Information Disclosure
and Regulations stakeholder expectations and demands
* Management * News Reports * Integrity and Lawful Operations
* Tax Payment ESG management. content in the report.and * Information Disclosure as Required while continuously improving ESG * Chemical Safety Management * Company Website * Economic Development Promotion
Regulators * Ecological Protection * Regular Communication * Environmental Management Focus
* Local Economic Growth Promotion
* Regulatory Supervision * Job Creation
management level. STL 2024 Material Topics Identification Process
* Sustainable Operations * Regulatory Investigations
* Risk Management and Assessment
* Business Ethics
* Employee Health and Safety
Highly Material Topics The company assesses the impact risk and opportunity of each topic based on its
* Product Safety and Quality impact significance and financial importance. We identified 8 high material topics
* Innovation and Research
and Development * Hotline Innovation and R&D Business Ethics 12 moderate material topics and 3 less material topics.* Customer Relationship * WeChat Official Account Product Safety Climate Change
Management * Customer Visits * Product and Service Quality * Ensuring Product Quality
Customers * Digital Transformation * Customer Complaints Assurance * Improving Service Standards
and Quality Response STL 2024 Double Materiality Topic Matrix
* Privacy and * Emails * Customer Demand Response * Enhancing After-Sales Services Pollutant Emissions and Circular
Information Security * Company Website * Customer Rights Protection * Innovating Service Initiatives Waste Management Economy
* Customer Relation * Satisfaction Surveys
* Management Chemical Safety Sustainable
* Business Ethics Management Operations
* Employee Representative
Meetings * Enhancing Compensation Moderately Material Topics
* Employee Rights * Employee Activities and Benefits
* Occupational Health * Engagement Surveys
and Safety * Employee Suggestion * Good Working Environment
* Strengthening Employee Privacy and Corporate
Employees * Employee Training Box CEO Mailbox * Employee Growth and Development
Representation Information Security Governance
* Robust Communication Mechanisms * Providing Career Development Paths and Development * Employee Discussion Panels * Salary and Benefits Protection * Offering Diverse Training Programs Clean Customer * Privacy and Information * Employee Conversations * Organizing Employee Activities Technology Relationship
Security * Employee Supervision * Creating a Healthy and Safe Work Development Management
and Suggestion Hotline Environment
* Bulletin Boards Risk Management Employee Training
and Development
* Long-Term Cooperation Maintenance * Strict Contract and Agreement
* Supplier Conferences * Business Ethics Compliance Compliance Supply Chain Energy
* Supply Chain Management * Hotline * TransparentJust and Fair * Transparent Bidding ProcessesPartners Management Management
and Industry * Industry Development * Regular Visits Procurement
* Adherence to Business Integrity
* Business Ethics * Company Website * Win-Win Development * Promoting Environmental Employee Rights Water Resource
Associations * Sustainable Operations * WeChat Official Account * Industry Advancement Partnerships Management
* Reporting Channel * Sustainable Supply Chain * Expanding Cooperation Models
Development * Industry Association Participation Occupational Health Ecological * Industry Knowledge Sharing and Safety Protection
* Social Welfare Promotion * Public Welfare Activities * Responsible Operations * Active Participation in Public Welfare
* Industry Development * Media Reports * Community Culture Building * Implementing Assistance Programs* Public Welfare Support * Supporting Community Less Material TopicsPublic and * Business Ethics * Open Days
* Corporate Governance * WeChat Official Account * Environmental Protection DevelopmentMedia Industry Development Digital
* Sustainable Operations * Hotline * Information Transparency * Advocating Green Initiatives Impact Importance to the Economy Society and Environment
* Risk Management * Company Website * Effective Communication * Maintaining Strong Media
Promotion Transformation
* Strong Media Relations Relations
Community Welfare Social Environmental Governance
1415
Financial Importance to the CompanySatellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Efficient Governance for Steady and Long-Term Growth
Corporate Governance The Company fully considers factors such as gender age professional expertise and industry experience when selecting board members
ensuring a diverse board composition while meeting various business needs. As of the end of the reporting period the board consists of
nine members including three executive directors. The age distribution includes six members born in the 1960s two in the 1970s and
Governance System one in the 1980s. This diverse age structure combines extensive experience with fresh perspectives bringing vitality to the team. Each
STL emphasizes the effectiveness and transparency of corporate governance. The Company strictly complies with the Company Law independent director has substantial industry experience with professional backgrounds spanning finance law chemical engineering
of the People's Republic of China the Securities Law of the People's Republic of China the Code of Corporate Governance for Listed and ESG providing the Company with a broader and more diverse perspective. Additionally the board values female leadership and
Companiesand other relevant laws and regulations. In accordance with the selection procedures stipulated in the Articles of Association continuously promotes independence and diversity in the governance of the board. The presence of two female directors further enriches
of Satellite Chemical Co. Ltd. the Company nominates and elects directors. The Company places great importance on information the board's decision-making approach.disclosure responding to the new "Nine National Guidelines" with the premise of safeguarding shareholder interests and delivering
sustainable returns. It strictly follows the requirements of the Administrative Measures for Information Disclosure of Listed Companies and Academic Background & Audit Remuneration Nomination Strategy & ESG
other applicable laws and regulations to ensure that Company information is disclosed truthfully accurately and completely. To further Name Gender Position Age Industry Experience Committee & Appraisal Committee Committee Committee
regulate related party transactions the Company has formulated the Related Party Transaction Decision-Making Policy which clarifies
the approval procedures and disclosure requirements for related transactions. The Company ensures timely and accurate disclosure of Yang Male Chairman 56 Business Manage / / Member Convener
relevant information including the nature amount conditions and impact of transactions. It also conducts regular independent audits to Weidong President
ensure compliance fairness and authenticity of transaction pricing preventing any transfer of benefits.Ma Male Vice Chairman 60 Business Management and
The Company has established and continuously optimized a governance structure composed of the General Meeting of Shareholders Guolin Chemical Industry
/ / / Member
the Board of Directors and its specialized committees the Supervisory Board and senior management to ensure stable operations and
fully protect shareholder rights. The Board of Directors has an Audit Committee a Remuneration and Appraisal Committee a Nomination Yang Female Vice Chairman 63 Business Management and / Member / /
Committee and a Strategy and ESG Committee. Each committee has clear responsibilities and work processes to ensure the effective Yuying Chemical Industry
operation of the Board enhance decision-making expertise reduce risks and maximize shareholder value.Zhu Male Director Vice 59 Business Management and / / / Member
The Audit Committee is composed entirely of independent directors and is responsible for overseeing the Company's financial reporting Xiaodong President Chemical Industry
and internal controls to ensure the fairness and compliance of related transactions. The Remuneration and Appraisal Committee is
responsible for formulating and assessing the Company's Remuneration policies and evaluation standards for directors and senior Gao Jun Male Director Vice 55 Business Management and / Member / /
management. The Nomination Committee provides recommendations on the selection criteria and procedures for directors and senior President Chemical Industry
management and reviews their qualifications. The Strategy and ESG Committee established as a specialized department by the Board of
Directors in accordance with relevant resolutions is primarily responsible for studying and making recommendations on the Company's Wu Yi Female Independent 39 Risk Management Financial Director Management and ESG Convener Member / Member
long-term development strategy major investment decisions and ESG-related matters.Guo Male Independent 51 Chemical Industry and Baitao Director Intellectual Property Member / Member /
General Meeting of Shareholders Feng Independent
Lianfang Male Director 61 Chemical Industry / Convener / Member
Tong Male Independent 52 Legal Industry and Risk Jianhua Director Management Member Member Convener /
Board of Supervisors
Shen Male Vice President 42 Business Management and Xiaowei Board Secretary Chemical Industry / / / /
Business Management
Board of Directors Li Ju Female Vice President CFO 52 Financial Management and / / / /
Risk Management
Ma Male Vice President 40 Business Management and Tujun Chemical Industry / / / /
The Company actively advances its "Management Leadership" and "Technology Leadership" initiatives by establishing a dedicated
leadership team for these two priorities. This team is responsible for comprehensively reviewing revising and refining Company
Audit Compensation and Nominating Strategy and regulations driving the development of new productive forces while optimizing and innovating the corporate governance system. These
Committee Evaluation Committee Committee ESG Committee efforts enhance internal controls and oversight further strengthening the modern corporate governance framework. By improving work
processes decision-making mechanisms and financial management regulations the Company has established a governance structure
with clear responsibilities checks and balances which ensures decision-making execution and supervision ultimately promoting the
modernization of corporate governance capabilities and standards.
16 17Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Efficient Governance for Steady and Long-Term Growth
Governance Strategy Impact and Risk Management
Based on the overall "Management Leadership" plan STL organizes its various centers bases subsidiaries and business units to STL has identified the following key risks in its business operations and has implemented measures for effective risk control:
focus on addressing the "Five Key Management Questions" implementing the "Four Management Transformations" and advancing
the development of "Management Leadership" No.1 Initiative. This initiative aims to further enhance the construction of a
management system characterized by an advanced corporate culture streamlined organizational structure clear processes well- Optimizing the credit control system and customer evaluation model implementing process Credit Risk
developed regulations refined management and efficient operations. management and using credit insurance to transfer part of the risk thereby enhancing
financial security.How can we establish a framework of How can we achieve a system where Improving foreign exchange hedging operations applying commodity hedging strategies
"benchmarking against excellence and "processes govern affairs and regulations Exchange Rate Risk and establishing a dynamic monitoring mechanism with dedicated personnel analyzing
optimizing improvements" to address govern people" to address the breadth of foreign exchange trends.the height of management management
Establishing a tax risk management system covering compliance transfer pricing tax planning
01 02 Tax Risk and internal control. This is managed through policy interpretation internal audits external inspections and the support of a tax management committee and third-party institutions.
Operational Risk Mitigating risks related to transactions assets decision-making and investments through contract
reviews asset inventory checks price monitoring and investment project evaluations.Five Key How can we create an ecosystem
How can we achieve "goal Implementing role separation regular inventory checks scientific authorization approvals Management of "sincere communication Financial Asset Security Risk
alignment and execution Questions and leveraging digitalization to enhance financial and asset security while reducing risks.05 03 and efficient collaboration" to implementation" to address the effectiveness of
address the strength of management
management Optimizing Management Efficiency
With the goal of achieving "Management Leadership" by improving work processes decision-making mechanisms and
04 financial management regulations the Company has established a governance structure with clear responsibilities checks and balances which ensures decision-making execution and supervision ultimately promoting the modernization of corporate
governance capabilities and standards.How can we balance "efficiency first
while considering risks" to address Enhancing Management Level Expanding Management Scope
the precision of management
By benchmarking against industry To establish a structured approach where "processes govern affairs and regulations govern
leaders the Human Resources people" the Company follows a "draft review learn implement assess" methodology.Center takes the lead in organizing During the reporting period it focused on building a "0-1" system developing the 12418
Transformation in Transformation in visits to top-performing enterprises system (1 framework 2 levels 4 major systems and 18 policy categories). Adhering to
Ideology and Concept Organizational Structure learning from best practices and five standardization principles—unified management unified standards unified norms
Achieve leadership in ideology 01 02 Adhere to the flat management aiming to become a benchmark unified templates and unified processes—the Company issued governance regulations and establish systematic reform approach of "small itself. and built a closed-loop policy management mechanism.thinking. Four Key headquarters large industries."
Management Improving Management Effectiveness Refining Management Precision and Strength
Transformation in Transformations Transformation in To foster a culture of "sincere communication and To balance "efficiency first while considering risks" and ensure "goal
Assessment Orientation Management Approach efficient collaboration" the Company applied the alignment and execution implementation" the Company optimized approval
Strengthen incentives competition and 04 03 Accelerate the institutionalization "Three-Degree Working Method" and designed a processes for the CEO and department heads and conducted inspections on elimination mechanisms to enhance standardization and process- top-down cultural implementation framework.The the implementation of system promotion and execution. On the premise of Company established communication mechanisms
departments' enthusiasm for "problem- oriented development to ensure ensuring effective risk control it enhanced approval efficiency and improved represented by joint meetings and coordination
solving and value creation." "inspection with clear criteria and the execution of institutional policies. At the same time each center base conferences while conducting cultural promotion
assessment with data." and experience-sharing activities to enhance subsidiary and business unit continued management enhancements tailored
management effectiveness. to their operational needs.
18 19Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Efficient Governance for Steady and Long-Term Growth
Investor Rights Protection
STL conducts annual training for directors supervisors and senior management to continuously strengthen their awareness Ideological Education and Party-Labor Groups Building
of information disclosure responsibilities ensuring that all investors have equal access to Company information. The Company Organizational Development and Diverse Activities
has established open fair transparent and multi-dimensional investor communication channels. Through emails phone calls
To reinforce ideological and political The Company has established 30 "Party-
Shenzhen Stock Exchange Hudongyi platform WeChat official account earnings briefings on-site research and the "Investor foundations the Company Party Committee Labor Groups" with over 200 members
Relations" section on its website the Company actively engages with investors. These efforts help deepen investors' understanding regularly holds ideological briefings. In regularly organizing activities such as Party
of the Company's operations and enable timely and effective responses to investor concerns comprehensively conveying the 2024 it convened 10 key meetings including history education team-building activities
Company's investment value to the market. Additionally STL proactively complies with regulatory requirements from the China expanded Party Committee meetings and and professional training. The Party Committee
Securities Regulatory Commission (CSRC) and stock exchanges by formulating the Three-Year Shareholder Return Plan on multiple recognition ceremonies for outstanding launched thematic Party Day events such
occasions. The Company has established a stable sustainable and scientifically structured dividend distribution mechanism Party labor youth and women's groups. as "retracing the first National Congress
ensuring shareholders benefit from its rapid growth. Throughout the year it conducted 61 learning route" and "Common Prosperity 101" closely
sessions on topics such as the 20th National integrating these activities themes like national
Metrics and Targets Congress of the CPC integrity education the rejuvenation and rural revitalization enhancing
Third Plenary Session of the 20th CPC Central the Party's cohesion and influence.During the reporting period Committee and important work methods.STL held 2 shareholders' meetings with a 100% attendance rate among directors
8 board meetings and reviewed 53 proposals.
Joint Party-Building and Party-Led Innovation
Brand Development in Production
The Company also held with a and reviewed
6 As one of Jiaxing's first publicly listed companies The Party labor youth and women's supervisory board meetings 100% attendance rate among supervisors 19 proposals with a distinctive Party-building brand the groups integrate advanced Party theories
Company actively participates in regional Party- with production practices inspiring frontline
building collaborations. It serves as the leader of Party members to drive innovation. Party
Additionally 3 Strategy and 2 Nomination 5 Audit 2 Remuneration and the "Red Sail" Party-building linkage initiative branches fully leverage their role as a
STL convened Appraisal Committee meetings and has partnered with East China University of fighting fortress establishing Party member ESG Committee meetings Committee meetings Committee meetings Science and Technology Securities Times and vanguard posts and demonstration posts
other institutions for joint construction activities. ensuring that the Party flag flies high over
every project.Targets 2024 Achievement
Internal policy release rate reaching 80% or more Achieved Business Ethics
Enhancing information disclosure quality Achieved
Optimizing investor relations management market value GovernanceAchieved
management and shareholder returns STL adheres to the principles of integrity transparency and just conduct strictly complying with the Supervision Law of the People's
Republic of China the Anti-Unfair Competition Law the Anti-Money Laundering Lawand other relevant regulations. The Company
has formulated policies such as the Integrity Management System Whistleblower Management Regulations Gift-taking Management
Strengthening Party Building Measures and Anti-Corruption and Anti-Bribery Management System.Through these measures STL fosters a culture of honest business conduct maintaining a zero-tolerance stance on corruption.STL established the "Xinghe Party Building" brand integrating Party leadership with corporate development while aligning with The Audit Committee serves as the highest governing body for business ethics matters overseeing and regularly reviewing policies
Company culture. The Company adheres to the principle of "Unity in Heart" to consolidate corporate strength the principles of "Unity issues and risks related to business ethics and anti-corruption. The committee ensures that the Company conducts at least one
in Strength" to drive business growth and "Unity in Harmony" guide green development. STL has developed a Party-Union-Youth- business ethics audit annually covering all operating locations and business activities. STL's Integrity Management Task Force leads
Women joint construction system adhering to the principle of "all work reaches the grassroots". As the Company expands capital anti-corruption awareness initiatives establishes relevant strategic objectives evaluates management performance and receives and
projects and industry chains it simultaneously optimizes Party organization structures to ensure a leadership role in corporate processes corruption-related reports. To strengthen anti-corruption and integrity supervision the Audit and Supervision Department
growth. In 2024 based on Company situation the Party Committee aligned Party-building efforts with business operations fostering conducts at least one annual risk assessment of key business activities while all centers bases subsidiaries and business units
an integrated "Party Building + Business" framework. The Company implemented synchronized planning deployment execution conduct quarterly reviews to identify high-risk areas and propose preventative measures. Upon receiving whistleblower reports the
and evaluation of Party building and business initiatives actively exploring approaches such as "Party Building + Market Expansion" Audit and Supervision Department investigates allegations recommends actions and tracks implementation of corrective measures."Party Building + Cost Control" "Party Building + Frontline Engagement" and "Party Building + Workplace Safety." The HR Department integrates ethical work into performance evaluations and provides integrity training for new employees. The
heads of each center base subsidiary and business unit implement the "dual responsibility" principle by promoting integrity within
The Company has one secondary Party committee one general Party branch and 14 Party branches. As of December 31 2024 the their respective units ensuring the implementation of anti-corruption measures promptly reporting any corruption issues to the
Company had 594 Party members representing a 20.5% year-on-year increase including 26 probationary members. Integrity Management Task Force to assist in investigations and enforce accountability measures.
20 21Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Efficient Governance for Steady and Long-Term Growth
Impact and Risk Management Additionally the Company has established an accountability system for supervision and inspection and further refined its accountability
mechanism for supervision and inspection. Any failure to fulfill responsibilities or actions that cause financial losses to the Company will
STL enforces zero tolerance for violations of business ethics. The Company has established and strictly adheres to the be strictly addressed according to the system with a tiered accountability approach based on the severity of the violation. The CEO's
Whistleblowing and Complaint Management Policy standardizing reporting channels and procedures. It follows the principles of Office is responsible for overseeing the entire process. At the same time the Company upholds the principles of fairness impartiality
evidence-based investigations factual accuracy and thorough investigation to ensure that all complaints and reports are handled equality and transparency ensuring that every employee has the right to report concerns to senior leadership Company management
promptly and effectively. STL encourages employees suppliers customers and other stakeholders to report any observed the Disciplinary Committee or the Audit and Supervision Department.misconduct related to business ethics. The Company provides multiple transparent reporting channels including letters hotline
calls emails in-person reports or third-party submissions. Once a credible report is received STL immediately develops an In addressing unfair competition risks unfair competition risks the Company has adopted a series of proactive strategies. Through
investigation plan conducts a thorough inquiry and imposes strict disciplinary actions upon confirming violations making sure the market research competitor analysis and other methods STL closely monitors market trends and the marketing strategies of industry
matters are seriously handled. To protect the rights of the whistleblowers STL has explicitly stated in its policies that within legal peers enabling the Company to anticipate and detect potential unfair competition. If another Company engages in unfair competition
and regulatory limits it will maintain strict confidentiality of the whistleblower's identity and report details. Any form of retaliation against STL the Company can promptly develop and implement targeted countermeasures including taking legal action to demand
against whistleblowers is strictly prohibited. During the reporting period STL experienced zero corruption-related lawsuits. the immediate cessation of infringement and actively safeguarding its legitimate rights and interests.The Company also prioritizes anti-money laundering compliance. STL has formulated and regularly reviews anti-money laundering
Whistleblowing Hotline Whistleblowing Email Whistleblowing Address policies collaborates with regulators for specialized training and enhances employees' ability to prevent money laundering through
case analysis and risk identification teaching.
0573-82058220 Compliance@weixing.com.cn Integrity Management Task Force STL Case Anti-Fraud and Anti-Money Laundering Training
No. 196 Fuqiang Road Nanhu District
Jiaxing City Zhejiang Province China
In October 2024 the Company collaborated
with local public security organizations to
The Audit and Supervision Department If the report is verified as true appropriate
Whistleblowing conduct specialized anti-fraud and anti-organizes personnel to conduct a lawful disciplinary actions will be taken according
Handling Process money laundering training. Employees investigation based on the report which to the severity of the violation. Severe were organized to systematically study
must be completed within 30 working cases will be handed over to judicial the characteristics of electronic fraud risk
days with a written investigation report. authorities. prevention strategies and emergency
response mechanisms. The Dongzha Police
Station sent an anti-fraud expert to conduct
01 Acceptance 02 Investigation Cooperation 04 Handling Appeal 03 05 compliance and anti-fraud training of Reports Requirements Results Process strengthening everyone's awareness of
financial security.The Integrity Management Task Force Relevant departments must fully If the whistleblower or the reported
prioritizes handling non-anonymous cooperate during the investigation. individual disagrees with the handling
reports and anonymous reports with The investigated individuals must decision they may file an appeal
sufficient factual evidence. provide truthful evidence while with the Integrity Management Task
maintaining strict confidentiality Force within 10 days of receiving the
regarding the investigation. investigation results and provide
supporting materials. Integrity Audits
To effectively identify and mitigate integrity risks STL conducts annual anti-corruption risk audits covering key business areas
Prevention and Correction Measures for Retaliation such as procurement sales logistics warehousing quality inspection and engineering construction. During the reporting
period the Company carried out 30 integrity-related audit projects covering procurement sales production costs inventory
engineering and logistics. These audits identified over 100 issues with a rectification rate of 89% and 15 individuals receiving
The whistleblowing website During the investigation of whistleblowing After the investigation is internal penalties. STL was not involved in any anti-corruption-related lawsuits.and hotline do not require cases all communications with whistleblowers concluded the Company will
whistleblowers to provide are conducted privately. The whistleblower's determine whether the whis-
personal identity information personal information and all submitted tleblower has faced any form Integrity Culture Development
materials are kept strictly confidential. Unless of retaliation. If retaliation is To enhance anti-corruption awareness the Company incorporates integrity education into its annual training plan. Various
necessary for the investigation investigators confirmed the Company will business ethics training and awareness activities are conducted for board members and all employees including outsourced
are prohibited from disclosing this information take legal action against the staff part-time employees and interns. These initiatives include displaying anti-corruption posters organizing case study
to any unrelated personnel responsible individuals sessions on corruption and arranging visits to external integrity education centers. Through these efforts the Company
ensures alignment with its business ethics standards and fosters a culture of integrity.
22 23Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Efficient Governance for Steady and Long-Term Growth
Case Anti-Fraud and Compliance Training
On July 12 2024 during STL's
mid-year summary conference
a compliance seminar themed
"Corporate Anti-Fraud and Criminal
Compliance" was conducted. All
managers and above from various
centers bases subsidiaries
and business units participated
in the training reinforcing the
Company's internal awareness
ofanti-fraud and compliance
principles. Integrity Awareness Display Boards
Metrics and Targets
In 2024
Anti- Total hours of Total number of Number of board Percentage of board
corruption business ethics business ethics members trained in members trained
Case Marketing Compliance Promotion audit projects training training sessions business ethics
30 120 100%hours 160times 9
On September 21 2024 STL's Audit and Supervision
Department organized a training session for sales Number of management Percentage of Total number of employees Percentage of employees
personnel on "Compliance Management in the Marketing personnel trained in management personnel trained in business ethics trained
System." The session used previous cases and focused business ethics trained in business ethics
on topics such as conflicts of interest improper benefits 5057 100%
transfer commercial briber y unfair competition around1200 100%
information confidentiality and professional ethics to
reinforce employees' awareness of compliance.Targets 2024 Achievement
100% of suppliers signed the Integrity and Compliance Commitment Letter Achieved
No involvement in any anti-corruption lawsuits Achieved
100% coverage of integrity training for all employees (including interns Achieved
outsourced personnel and part-time staff)
Company-level integrity training sessions ≥ 2 Achieved ( Company-level: 2
Audit and Supervision Department integrity training sessions ≥ 8 Audit and Supervision Department: 8
Integrity training sessions for each center base subsidiary Centers/Bases/Subsidiaries/Business
and business unit ≥ 3 Units: 49 )
Integrity and Confidentiality Training for the Supply Chain Integrity Awareness Campaign for the STL New Materials Project
Management Department
24 25Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Efficient Governance for Steady and Long-Term Growth
Strengthening Risk Prevention and Control
Assess and identify key challenges in operations.Compliance Development Business Optimize operational standards and process guidelines drafting management guidelines or Departments institutional requirements.Submit drafts to the Corporate Management Department for review and approval.Legal Compliance Assurance Tax Compliance
To ensure stable operations in legal compliance STL has STL incorporates "actively generating taxes for local governments" into its
formulated and refined a series of management systems corporate culture actively fulfills tax information disclosure obligations Risk Corporate Management Department: Defines approval authority at different management
including the Legal Management Regulations Legal Review ensuring the transparency and accuracy of tax declarations. The company Management levels manages institutional procedure development formulate and reviews submissions
Management Measures Dispute Resolution Management is always committed to contributing to the local economic development Departments from business department enforces system implementation requires business unites to
Measures Legal Consultation Management Measures through stable and standardized business operations. (Including formulate relevant documents and tracks the implementation of various regulations.and External Lawyer Management Measures. These
internal policies regulate legal management processes and The Company strictly follows all national tax laws and regulations files tax
Corporate Finance Center: Reviews and controls financial risks associated with business activities.Management
strengthen legal risk control. During the reporting period returns on time and pays all applicable taxes including value-added tax Finance Center Legal Compliance Department: Enhances legal risk management systems identifies and
the Company revised the integrity clauses in contracts corporate income tax and consumption tax. We have built a complete Legal Compliance reviews compliance risks related to finance and regulations.further enhancing the prevention and control of integrity tax management system in combination with internal self-assessments Production Safety
risks in contract management. The Company regularly and external consultations to ensure the accurate implementation of tax Production Safety and Environment Center: Reviews risk control measures related to safety
organizes legal training covering topics such as export policies and reduce risks. The Company conducts business in overseas
and Environment
Center) and environment in business units.credit insurance contract laws practical application of the countries and regions such as Hong Kong Singapore and the United
CISG and integrity education to improve employees' legal States committing to full compliance with the laws and regulations of its
awareness and compliance capabilities. operational locations. STL adheres to transfer pricing rules ensures that
profit distribution aligns with value creation does not shift profits to low-tax Annually evaluates and updates the risk control matrix and integrity risk assessment.regions and follows the spirit of the law and the principle of tax fairness.Engages with relevant business departments to address weak controls or non-compliance
Internal Control System issues during reviews.Audit and
STL has established a comprehensive internal control system covering five key elements: control environment risk assessment Supervision Conducts audits on business activities that fail to meet expected outcomes.control activities information and communication and supervision. This system ensures asset security operational efficiency Department
and regulatory compliance. The Audit and Supervision Department formulates an annual internal control audit plan based on the Assesses the implementation and deficiencies of existing regulations.Company's development strategy and external regulatory requirements evaluating and auditing the implementation of internal
controls across various business activities. Issues identified during audits are promptly communicated with relevant departments Evaluates the performance of operational staff and provides recommendations for policy and
and rectification progress is closely monitored. Additionally the Company prepares a quarterly internal control audit report which process improvements.is submitted to the Board Office for review and regularly reported to the Audit Committee. When evaluating the effectiveness of
internal controls the Board incorporates sustainability responsibilities into the assessment identifying and addressing relevant The Company continuously optimizes its risk management processes strengthens risk identification and response capabilities
risks while proposing improvements. to ensures the stable operation of its risk management system.In 2024 STL conducted 22 special audits 14 internal control compliance checks 3 exit audits and 5 complaint investigations
identifying a total of 120 audit issues with a rectification rate of approximately 89%. These efforts directly recovered losses of about
1.8 million yuan. When significant issues are identified the Audit and Supervision Department has the authority to adjust audit
objectives expand the audit scope and submit recommendations to the Board of Directors for further action. Collect initial
information on risk
management
Risk Management Supervise and improve risk Conduct risk
management assessment
STL has established a well-defined and fully functional risk management and internal control system. The Board of Directors
serves as the leadership and decision-making body for the Company's risk management overseeing the development of the risk
management and internal control framework setting the Company's vision and determining strategic plans. The CEO's Office is
responsible for inspecting the implementation of these systems supervising key resolutions and ensuring the effective execution Propose and
of Company decisions. At the operational level business units risk management departments and the Audit and Supervision implement risk Develop risk management
Department are responsible for formulating specific countermeasures against major risks. To ensure the effectiveness of the risk management strategies
management and internal control system the Company has implemented a "three lines of defense" model effectively mitigating solutions
operational risks and enhancing overall risk management capabilities.
26 27Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Efficient Governance for Steady and Long-Term Growth
The Company has established risk prevention and response strategies covering its business scope to comprehensively enhance risk
prevention capabilities. It has developed a risk identification and rectification checklist for areas such as integrity information security raw Information Security
material procurement external investments and product sales. This approach continuously improves risk management initiatives and
strengthens overall risk management effectiveness. Governance
Risk Type Policies & Regulations Response Measures STL strictly complies with the Cybersecurity Law of the People's Republic of China and other relevant laws and regulations. The
Company has formulated multiple policies and regulations including the Information Management Regulations Information Project
1.Conduct comprehensive integrity promotion and training covering all employees in all centers Construction Management Measures Information System Emergency Management Measures Information Equipment Configuration
Integrity Management System bases subsidiaries and business units. and Usage Management Measures and Computer Network Management Measures.These policies ensure management in areas
Whistleblowing Management 2.Identify and assess integrity risks.3.Announce integrity red-line behavior standards optimize system and process frameworks and such as endpoint security system security data security operational security network security and data center security effectively
Regulations
Integrity Risk continuously improve integrity risk control measures. preventing information security incidents. The Company has established a comprehensive business secret protection compliance
Gift-taking Management Measures 4.Conduct annual inspections on major integrity risks within the group and close the management
loop on identified issues. system issuing key policy documents including the Trade Secret Management Policy Trade Secret Compliance Manual Information Anti-Corruption and Anti-Bribery 5.Encourage employees and partners to report corruption. Confidentiality Management Regulation and Employee Exit Management Procedure.These measures clearly delineate the scope
Management System 6.Strictly punish corruption—employees involved in corruption will be penalized based on the severity
of the offense. of confidential information specify protection protocols and require employees in sensitive positions to complete a mandatory
declassification process upon resignation safeguarding the Company's intellectual property and innovation achievements.
1.Use encryption technology for both static data and data in transit. To ensure the security and continuity of business operations STL follows a proactive prevention and integrated governance approach.
2.Implement strict access control policies following the principle of least access.
Information Security Management The Company has established a comprehensive information security management system that integrates personnel and technical 3.Establish a comprehensive data backup strategy.Information Measures 4.Deploy firewalls intrusion detection and other network security devices and software to prevent protective measures. Information security management follows a leadership responsibility system with the Information Center
external attacks or intrusions.Security Risk Information System Emergency overseeing the planning implementation and supervision of Company-wide security management while department heads oversee 5.Regularly train employees on data security awareness.Management Measures 6.Provide emergency response training for relevant personnel and conduct regular drills. information security practices within their respective departments.
7.Deploy data monitoring tools to track data access transmission and usage in real-time.
8.Establish a robust audit and logging system.
Impact and Risk Management
Procurement Demand 1.Fully regulate all procurement processes to establish a strong institutional foundation for risk STL upholds principles of compliance and security in data management. During data collection the Company transparently informs
prevention.Management Measures data subjects of the purpose scope method and duration of data collection obtaining explicit consent before proceeding. Only
Procurement 2.Standardize the preparation submission approval and modification of procurement plans to Supplier Management Measures ensure material supply while preventing overstocking. data directly relevant to business needs is collected avoiding excessive data gathering. For data usage STL has established strict Risk
Business Procurement Center 3.Establish a comprehensive supplier access selection performance evaluation and exit mechanism. access control mechanisms restricting data access based on employees' roles and business needs. This ensures that only authorized
4.Strengthen procurement contract management standardizing drafting review signing execution
Contract Management Measures and dispute resolution. personnel can access and utilize specific data safeguarding security and privacy. The Company conducts regular audits of data
access and usage maintaining detailed records. In the event of a data breach STL traces the source and responsible parties to
ensure traceability and accountability. During the reporting period the Company entered into confidentiality agreements with all
1.Implement the Company's major business and investment project decision-making policies.
External 2. Ensure capital allocation and project advancement from decision-making to detailed
employees outlining their responsibilities and obligations in data protection as well as the consequences of violations.Major Operation and Investment implementation planning.Investment Decision System 3. Enhance investment project execution oversight through internal audits and project settlement
and reviews. STL places great importance on information security risk management implementing a series of measures to identify assess
Guarantee External Guarantee Management 4.Continuously monitor the financial and operational status of guaranteed entities to detect and and mitigate risks ensuring the security of information assets and business continuity.Risk System respond to potential risks promptly.5.Ensure guaranteed entities fulfill their obligations on time and take measures when necessary to
minimize Company losses.Risk Identification Risk Prevention Measures Monitoring & Early Warning
1.Establish an organizational structure with business delegation to create mutual supervision. * Utilize professional vulner- *Deploy an intrusion prevention system (NIPS) to identify * Perform real-time traffic
2.Manage behaviors through customer credit assessment pricing contract strategy planning and
Sales Credit Management ability scanning tools to con- and block attack traffic in real-time effectively preventing supervision policies to mitigate risks. analysis across the entire
Sales Risk Measures 3.Use standardized contract templates to prevent contract-related risks. duct comprehensive network malicious attacks. network; monitor cyberse-
Pricing Processing Measures 4.Implement a multi-tiered approval process to enhance risk control. system scans promptly identi-
5.Conduct daily and weekly business reviews and functional anomaly reviews to identify and control * Implement firewalls to enforce static security policies curity trends; ensure secu-
risks in a timely manner. fying potential security vulner- strictly controlling external access reducing external rity incidents are detected
abilities in operating systems exposure and ensuring internal network security. and addressed at the earli-
databases and applications.* Deploy behavior management tools to monitor and audit est opportunity.Risk Identification and Rectification Checklist * Regularly conduct informa- employee internet access including but not limited to:
tion security risk assessments installation of antivirus and desktop management software
During the reporting period to identify security risks in on all endpoints;
critical business systems and prohibition of USB storage devices;
1 23 59 important information assets. watermark controls; and encryption of all files upon storage we conducted external risk management audit and internal audits and organized compliance to prevent internal information leaks and policy violations.
Key
Performance and risk control training sessions with 1120 employees participating totaling 840 training hours * Automatically update protection software virus databases
Indicators daily to address evolving security threats and enhance
system protection.
28 29Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Efficient Governance for Steady and Long-Term Growth
Metrics and Targets
Targets 2024 Achievement
0 Major information system failure incidents Achieved
0 Customer information leakage incidents Achieved
In 2024
Number of Losses caused by violations Training participants of Percentage of employees
information security of customer rights protection trade secret protection who signed confidentiality
system audits laws and regulations compliance agreements
105508100%
Additionally STL has developed and integrated a series of digital production operation and management systems to enhance data
convergence continuously improving management efficiency and operational effectiveness and exploring new data governance
models. During the reporting period with its outstanding digital transformation efforts and advanced integration of IT and
industrialization STL received several prestigious honors including the Provincial 5G Fully Connected Factory Award a ranking
among China's Top 100 Strategic Emerging Industry Leaders and the Forbes China 50 Most Innovative Companies. These accolades
Security Attack Monitoring and Early Warning Platform reflect the recognition of STL's data governance efforts by authoritative institutions.To address potential emergencies the Company has issued Information System Emergency Management Measures and
established a dedicated emergency response team to ensure a swift activation of contingency plans in the event of an
information leak or other urgent situations. Upon detecting an information security incident the Company will immediately
employ all available technical means to prevent escalation conduct a technical diagnosis to identify the cause of the breach
and develop corresponding solutions and recovery plans. For affected information systems the Company will carry out
restoration work to ensure a prompt return to normal operations.To continuously enhance employees'
information security awareness the Company
conducts an annual cybersecurity attack
and defense drill simulating real attack
scenarios to test the effectiveness of its security
protection system and improve employees'
security awareness and emergency response
capabilities. Additionally the Company
organizes multiple information security
training sessions for all employees covering
topics such as internet behavior management
cloud desktops data encryption document
watermarking and personal information
security precautions. These training sessions
also include contractors and part-time
employees to raise everyone's awareness and Information Security Training
foster a culture where information security is
everyone's responsibility.
30 3102 Innovation to Foster an Excellent Brand
STL is steadfast in its commitment to technology as the driving force of the future. By establishing a multi-tiered R&D platform
strengthening its talent pool and increasing investment in research and development the Company continuously advances
breakthroughs in key core technologies enhances digital manufacturing capabilities and strives to achieve technological self-
sufficiency and leadership in the field of advanced chemical materials.Governance The Company has established multiple provincial and municipal R&D platforms as well as product quality
testing laboratories refining its R&D talent structure and comprehensive quality and safety management
system. It strengthens full-process supplier management expands industry collaboration and enhances
corporate competitiveness and industry recognition.Strategy STL continuously advances its "Technology Leadership" strategy by driving both technological and managerial
innovation. Through a modern corporate governance model of "co-creation shared benefits and mutual
prosperity" the Company fosters deeper integration of innovation and industrial chains injecting new momentum
into cultivating advanced productive forces.Goals
Achieve an R&D investment of RMB 10 billion and R&D incentives of RMB 1 billion within five years
with an R&D team of 2000 people.Ensure 100% product pass rate at Maintain 0 major or above-level
factory dispatch quality incidents
Achieve a 100% signing rate of integrity Ensure a 100% response rate
agreements with suppliers and timely resolution for customer complaints
Ensure a customer satisfaction rate greater than or equal to 95.5%
Impacts STL integrates technology innovation resources fostering deep collaboration between industry academia and
UN SDGs
risks and research institutions. The Company proactively addresses risks such as intense market competition rapidly changing market demands supply chain disruptions and co-opetition pressures. By strengthening its quality
opportunities management system it has built the "Cloud-Based Chemical Plant" and a "Five-in-One" safety production
digital management platform enabling full-process traceability and risk control in production operations.Through industrial chain integration it optimizes resource allocation enhances supply chain efficiency and
serves as the "driving force" for new productive forces.Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Innovation to Foster an Excellent Brand
Empowering Development through For future R&D Directions STL continues to drive its products toward high-end green and intelligent advancements:
Technology Innovation
Expansion of * Deepening expertise in the C3 industry chain independently developing polyol production
the industry processes enhancing research on acrylic acid and ester production technologies advancing
new downstream materials and exploring bio-based acrylic acid synthesis
Innovation and R&D chain & hydrogen
energy * Entering the hydrogen energy sector developing hydrogen fuel cell materials and
development maximizing the efficient use of by-product hydrogen
Governance
* Promoting high-quality growth of the C2 industry chain including the development of
STL adheres to an innovation-driven growth strategy establishing a governance framework covering the entire cycle from metallocene polyolefin and elastomer production processes advancing differentiation and
technological innovation to industrial application. The Company has set up multiple provincial and municipal R&D platforms leapfrog progress in the domestic high-end polyolefin sector and collaborating with domestic
including the Enterprise Technology Center of Zhejiang Province and the Center Laboratory for Vinyl High-End New Materials universities on waste plastic recycling technologies
of Jiaxing alongside product quality testing laboratories. It has also collaborated with downstream customers to establish
multiple application technology research centers. In 2024 the Company was officially awarded a national-level postdoctoral
research workstation and its future R&D center project has entered the construction phase providing a high-level platform to High- * Developing functional products (e.g. antibacterial deodorizing and fragrance-releasing
foster new productive forces. performance variants) to meet consumer demand
SAP &
functional * Developing functional SAP products (e.g. high-retention and high-pressure products) to
product enhance hygiene product quality
development
* Developing eco-friendly biodegradable SAP for applications in agriculture cosmetics and
food preservation
New energy * Advancing research in high-performance catalysts new energy materials and polymer
& advanced materials such as developing corrosion-resistant coatings for offshore wind power
materials contributing to the sustainable growth of the sector
* Independently developing acrylic acid catalysts to lower production costs and improve
market competitiveness
National-level Postdoctoral Research Workstation Officially Certified
Green & * Innovating green and low-carbon technologies such as carbon capture & utilization (CCU)
low-carbon and hydrogen energy integration accelerating the industry's green transformation
To build a robust talent pipeline the Company and its various business units have developed a clear R&D talent organizational development
structure actively recruiting high-caliber technical professionals and engaging external experts for guidance. STL has
implemented the Rules for the Professional Grading of R&D Personnel ensuring standardized qualifications and continuous
enhancement of professional capabilities. By conducting professional grading evaluations the Company incentivizes R&D Risk & Opportunity Management
personnel to overcome technological barriers maintaining its position as a leader in the industry.STL actively implements a series of measures to address potential risks in research and innovation including technology leaks
talent competition innovation bottlenecks market competition and intellectual property disputes. At the same time the
Company is seizing opportunities arising from policy support growing market demand and technological innovation driving
Strategy industrial upgrades.Guided by national strategies STL firmly upholds an innovation-driven approach. The Company has established a "Technology
Leadership" management framework defining and implementing the principles of technological leadership breakthroughs R&D Confidentiality Management
and advancements. It has enhanced organizational safeguards clarified incentive mechanisms and fostered an innovation-
friendly environment. To align with its "Management Leadership" initiative the Company has updated its design and To safeguard its legitimate rights and interests STL has formulated the Management Measures of R&D Information Confidentiality
development control procedures R&D project management processes and R&D project transformation workflows releasing to ensure the appropriate use effective management and protection of R&D information. This policy standardizes the behavior
a series of internal regulations such as the Design and Development Control Procedure R&D Project Management Process of personnel handling confidential information and mitigates the risks of illegal acquisition misuse and leakage of R&D data. By
and R&D Project Transformation Process. These measures strengthen the Company's scientific and efficient R&D workflow establishing a comprehensive R&D information confidentiality management system the Company ensures intellectual property
ensuring orderly and effective innovation management. protection for research outcomes and reduces commercial risks associated with information disclosure.
34 35Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Innovation to Foster an Excellent Brand
Industry-Academia-Research-Application Collaboration Green Product R&D
STL is committed to expanding the application of green products and processes enhancing product value and driving the
STL continues to deepen integration of industry academia research and application. The Company has established joint green transformation of the chemical industry.laboratories innovation alliances and academician and postdoctoral workstations in partnership with Zhejiang University
Tongji University Fudan University East China University of Science and Technology and Shanghai University. This collaborative
framework fosters an integrated innovation ecosystem that spans basic research technological innovation achievement Efficient use of light Using light hydrocarbons (e.g. ethane propane) as feedstocks offers
transformation and industrial development. hydrocarbon materials significant green and low-carbon advantages over coal and oil.Through joint efforts with universities and research institutes STL has undertaken a series of critical technological advancements.Notable achievements include the development of ultra-low-density ethylene copolymer structure characterization and
application technology as well as the resource utilization of acetic acid purified from acrylic acid wastewater. These research Green High-purity H2 produced during light hydrocarbon cracking is directly used Materials
outcomes have been successfully commercialized. Additionally the Company collaborates with universities in training master's and & Efficient use of hydrogen- in production processes addressing the challenges of "green hydrogen"
doctoral-level talents establishing exemplary talent development bases and cultivating high-caliber R&D professionals to support Use of rich resources storage and transportation while laying the foundation for the hydrogen Resources
sustainable corporate growth. STL also actively participates in the formulation of national and industry standards having led or economy in the future.contributed to multiple national industry and group standards further enhancing its industry position and influence.Using carbon dioxide Utilize CO2 efficiently in green processes such as coupling ethylene
Case "Leading Goose" Initiative Supporting New Energy and Advanced Materials R&D as resource oxide with CO2 to produce ethylene carbonate.In January 2024 STL in collaboration with Zhejiang University and other academic and corporate partners launched the
"Low Expansion/High Adhesion Lithium-ion Battery Electrode Adhesive Research and Development" project which was
selected as a key initiative under Zhejiang Province's "Leading Goose" R&D special program. This project focuses on the
demand for new energy development under the dual-carbon strategy driving innovation in water-based polyacrylic acid Optimize POE production technologies to reduce raw material
(PAA) lithium battery adhesives. With its low expansion and high adhesion properties this adhesive is expected to become Breakthroughs in energy consumption and energy consumption while enhancing product
the next-generation anode material binder further propelling the new energy industry forward. efficiency optimization performance advancing the green development of China's photovoltaic
industry.Case Exploring a New Model for Campus-enterprise Cooperation
Develop high-performance catalysts with independent intellectual
Green Processes
In February 2024 STL signed a cooperation agreement with Jiaxing Nanhu High-Tech Zone and the Department & Development of high- property rights achieving multiple technological breakthroughs that
of Chemistry of Fudan University to jointly develop new cycloolefin copolymer (COC/COP) synthesis technologies. Technological performance catalysts drive the localization of high-end raw materials and advance green Innovation process upgrades.By leveraging the "dumbbell-shaped" model of university–industry collaboration the initiative aims to establish
a provincial-level joint laboratory and a graduate training base.Successfully develop a deactivation technology for the harmless disposal
Harmless disposal of
hazardous waste of waste ethylene polymerization catalysts which transforms hazardous
substances into landfill-safe solids achieving zero pollution emissions.Develop photovoltaic-grade POE materials to support the development
High-end polyolefin
product pipeline of the new energy sector. Develop a variety of high-end polyolefin grades to improve the localization rate of high-end polyolefin products.Develop a new formaldehyde-free zero-pollution reducing agent
Development Eco-Friendly functional filling a gap in the domestic market. The anti-yellowing agent for of Green
Products chemicals
superabsorbent resins enhances resistance to high humidity and heat
reducing reliance on imports.In-house developed lithium battery binder technology (low expansion
Innovations in new rate high adhesion) improves the cycle life and energy density of silicon-
energy materials based batteries. Ethylene carbonate homogeneous catalyst technology
drives the development of green chemical processes.
36 37Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Innovation to Foster an Excellent Brand
Intellectual Property Protection
Indicator Unit 2024 2023 2022
STL continuously enhances its intellectual property (IP) management framework to safeguard its innovations. The Company
has established policies such as the Management System for Corporate Patents and Management System for Confidential
Information. Since 2018 it has implemented an IP management system that integrates the entire lifecycle of IP acquisition R&D team & investment
maintenance evaluation licensing and transfer risk control confidentiality R&D procurement and production into its control
procedures. To strengthen patent mining capabilities among R&D personnel and technical engineers and to raise overall Number of R&D personnel person 1275 1271 992
awareness of IP protection the Company conducts comprehensive training sessions covering fundamental patent knowledge
patent mining and application management system manuals and procedural documents.Bachelor's degree person 1020 1151 882
In May 2024 the Company successfully passed the second supervisory audit conducted by a third-party IP management
certification body. Throughout the year there were no significant IP infringement or litigation incidents. Doctorate or master's degree person 255 120 110
Metrics and Targets R&D investment RMB'00 million 17.51 16.26 12.41
In 2024 STL established R&D innovation goals aligned with its overall development strategy considering resource advantages Ratio of R&D expenses to operating
and business characteristics across its various bases and divisions. These goals were further broken down into specific targets % 3.84 3.92 3.35income
with corresponding measures implemented to achieve remarkable progress in patent applications and R&D investment.Patents
Category Target 2024 Achievements
Invention patents filed item 148 40 39
In 2024 Invention patents granted item 36 29 27
In 2024 STL filed 148 invention patents (110% completion rate)
STL planned to file 117 utility model patents (177% completion rate) Valid invention patents item 134 100 69
Patent 200 patents
applications Utility model patents filed item 117 35 68
including 134 invention
patents and YoY growth Utility model patents granted item 85 67 66
66 utility model patents 131% for invention patents 27% for utility models Valid utility model patents item 304 220 165
The high-quality patent filing initiative maintains steady progress
Total valid patents item 438 320 234
Continue increasing R&D Software copyrights filed item 8 8 0
spending aiming for RMB In 2024
R&D 10 billion over five total R&D investment reached RMB 1.751 Software copyrights granted item 14 2 0 investment
years to overcome critical billion increased by YoY
technological barriers in new 7.69% Valid software copyrights item 37 23 21
materials
IP protection training
Continuously attract and R&D personnel reached Training sessions conducted session 9 5 3
develop high-level innovative
R&D talents targeting a research
personnel 2000 1275 persons Employees trained person 80 49 33team of
members within five years
Total hours of training provided hour 36 5.5 3
38 39Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Innovation to Foster an Excellent Brand
Digital Intelligent Manufacturing Digital Development Roadmap
STL has established a phased digital transformation plan to enhance operational efficiency and market competitiveness
while supporting sustainable development and safe production. The Company closely monitors advancements in artificial
Digital Transformation Strategy intelligence (AI) and actively integrates AI-driven innovations into its operations.Guided by its "He" culture STL committed to the vision of leading digital transformation in the chemical industry. The
Company steadfastly advances its "Dual-Five-Year Plan" focusing on "Management Leadership" and "Technology
Leadership" while building a comprehensive digital platform covering the entire upstream and downstream industrial
Planning 2024 2025-2026 2027-2028
chain. This initiative strengthens data operational organizational security and innovation capabilities resulting in a phase Informatization - Comprehensive Digitization - Digitalized operations Intelligentization - Intelligent decision
robust digital ecosystem spanning ten key areas including integrated business-finance operations collaborative office business coverage making
platforms process optimization digital factories data centers and industrial internet applications. Strategic Production & procurement data Intelligent business analysis &
decision- Marketing data analysis
making analysis performance evaluation
Management Leadership and
Technology Leadership
Enhancing HR management
Implementing comprehensive
Corporate optimizing CRM and Building cost-benefit models for
budget management upgrading
governance SRM systems piloting intelligent approvals
financial controls and analytics
e-procurement
Expanding information
coverage to the Satellite Deploying proprietary MES systems Establishing digital twin factories
Operational
Energy Scope III project upgrading safety and regulatory deploying RBI and RCM models
execution
Group Intelligent integrating safety platforms platforms applying AI in multiple scenariosGroup Marketing Group Procurement
Platform Platform Manufacturing Platform upgrading LIMS systems
Contract management
Group Financial Group HR Group OA Group R&D Group Safety Support & Centralized alarm Data center infrastructure
Platform Platform Platform Platform Platform
optimization unified document
assurance management platform upgrades
and portal management
Group Operations & Big Data Control Platform
Operations Management System Manufacturing Management System
Customer Relations Management System / Supplier Safety Management System /
Relations Management System Production Intelligent System
Procurement Management System / Financial Sales Logistics and Warehousing
Management System Management System
Human Resources Management System / Quality Management System / R&D Management System
Collaborative Office System
Decision-Making Support System
The Company's Business Platform
IT Infrastructure Platform
40 41Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Innovation to Foster an Excellent Brand
Effectiveness of Digital Transformation 5G Smart Factory Development
STL is actively advancing the construction of 5G smart factories. By integrating chemical industry demands with 5G technology
the Company has incorporated 5G modules terminals gateways and cutting-edge technologies such as edge computing
big data artificial intelligence and VR/AR. This initiative has established a fully connected 5G+ industrial internet ecosystem
Enhanced Production Efficiency Strengthened Green and Low-Carbon Production for chemical production. Covering 20 application scenarios—including 5G+ precision operations predictive equipment
maintenance intelligent scheduling and production efficiency management—the project ensures comprehensive integration
By refining equipment performance management and Digitalized management has reduced emissions of of safety environmental protection emergency response energy efficiency analysis logistics tracking and public services.production processes the Company has optimized "three wastes" improved energy efficiency lowered
equipment investment and capacity allocation industrial water consumption and minimized
strengthened centralized factory control and effectively resource waste. Driving smart chemical Leading intelligent and Empowering the industry
reduced product operational and quality costs. production digital transformation supply chain
With 5G peak speeds reaching 1Gbps AI-powered inspection technology enables Leveraging geographical advantages
production and management efficiency real-time detection and mitigation of the Company has developed a supply
have significantly improved fostering the production safety hazards ensuring chain management platform for the
Increased Supply Chain Agility Reduced Safety Risks in Production intelligent transformation of production continuity and workforce reliability. chemical industry integrating procure-
environments to accommodate various ment production and sales to provide
The Company has reduced inventory redundancy Real-time safety response speed at plants has reached the manufacturing demands. transformation insights for other chem-
shortened delivery times and minimized design millisecond level with an identification accuracy rate of up ical enterprises and improve supply
iteration cycles. to 85%. Strengthened real-time hazard detection has led to chain coordination.The Company has deployed 5G network Predictive maintenance through data
a 50%-80% reduction in safety incidents. infrastructure to explore remote control analysis accelerates fault diagnostics
safety alerts intelligent inspections and enhances production stability
environmental monitoring and data steering chemical manufacturing towards
collection applications providing robust automation digitization intelligence and
support for smart manufacturing. collaborative efficiency.AI-Powered Innovations
In response to national initiatives promoting AI-driven industrialization STL has pioneered the "AI + Chemical" model
to enhance new productivity standards. In 2024 the Company successfully developed an "AI-based Flexible Intelligent
Manufacturing Model for High-End New Materials" which was selected for Zhejiang Province's 2024 Artificial Intelligence
Application Scenarios List. This model integrates large-scale AI optimization algorithms data-driven deep learning models
and real-time intelligent scheduling technology. It supports enterprises in optimizing production planning enhancing
responsiveness and improving decision-making quality. The model has successfully reduced inventory accumulation and
market risks while increasing resource utilization efficiency and production effectiveness. It promotes flexible manufacturing
in multi-variety production environments and optimizes standardized intelligent manufacturing processes.Case DCMM Certification – Advancing Digital and Intelligent Management
STL has actively developed its data management capabilities as part of its digital transformation strategy. The Company has built
a professional team specializing in data management and application fostering a data-driven mindset and strategic approach. By
standardizing workflows the Company has ensured the effective utilization of data in corporate operations. As a result its wholly-
owned subsidiaries Satellite Energy and Pinghu Petro Chemical have obtained National Data Management Capability Maturity
(DCMM) Level 3 and Level 2 certifications. Notably Satellite Energy is the second manufacturing enterprise in Jiaxing City to achieve
this recognition. The certification serves as a testament to the Company's robust data management capabilities and provides strong
support for its digital transformation initiatives. STL will continue adhering to DCMM standards actively responding to national
digital economy strategies and driving the ongoing development of intelligent and digital transformation to empower high-quality
corporate growth and industry-wide digital upgrades.
42 43Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Innovation to Foster an Excellent Brand
High-Quality Products and Services Quality Management System Certification In 2024
Through strict quality control processes and continuous improvement initiatives
STL ensures compliance with international standards and customer expectations. The Company did not
Quality Management The Company has actively promoted quality management system certification experience any violations
achieving 100% coverage of operational sites under the ISO 9001 certification or penalties related to
during the reporting period. product quality.Governance
STL has established a comprehensive and effective quality and safety management framework ensuring high standards for product
quality and safety across all its facilities and business units. Following the principles of "unified leadership tiered management and division
of responsibilities" each facility and business unit develops a holistic management system tailored to its specific conditions ensuring
clear responsibilities from top management to frontline employees. At the top management level the General Manager and management
representatives formulate quality and safety strategies and annual objectives allocate resources and oversee policy implementation. The
mid-management level including the Quality and Safety Director and the Production Technology and Quality Department is responsible
for monitoring daily operations document management and ensuring the effective execution of quality measures. At the grassroots
level quality and safety personnel along with employees are responsible for implementing specific measures to ensure compliance with
standards in production activities. Additionally the Company has established a "daily control weekly inspection and monthly review"
supervision and assessment mechanism. Through continuous monitoring and evaluation STL drives improvements in product quality
laying a solid foundation for long-term development and market competitiveness.ISO 9001 Quality Management System Certification
Decision-Making General Manager and management representatives
Quality Management Processes
STL has developed a comprehensive quality management process that covers the entire product lifecycle—from raw material
Management Director of Quality and Safety and Production Technology & Quality Department acquisition to after-sales service—ensuring the highest product and service standards.
010203
Quality Product
Execution Quality and safety officers and employees assurance packaging Production
for raw and materials process
materials management management
Quality and Safety Management Framework of STL
Conduct supplier assessments and strictly enforce Implement quality inspection and Break down quality goals at the beginning
the incoming goods inspection system to ensure raw management for packaging materials of each year define key control points
Strategy and auxiliary material quality from the source. used in packaging operations and other and monitor and inspect the intervening processes. Once any issues are found processes.Develop trial plans for newly introduced or modified
STL strictly complies with the Product Quality Law of the People's Republic of China and the Standardization Law of the suspend the use of the materials at raw materials to assess their quality. issue and notify relevant departments. Organize production in strict accordance
People's Republic of China among other laws and regulations. The Company has formulated and updated a series of with procedures maintain quality re-
internal management documents including the Quality Management System the Incident Management System the Quality Store incoming materials in respective areas with Monitor and inspect packaging mate- cords and conduct evaluations.Management Regulations the Critical Activities and Key Quality Control Points the Analysis Frequency Management proper labeling maintain inventory records and rial quality to ensure compliance with
Guidelines and Raw and Auxiliary Materials Management Guidelines conduct regular inspections to prevent deterioration. requirements. Inspect products in line standards pre-. These documents refine assessment standards and Segregate and label substandard or deteriorated vent non-conforming products from
enhance employees' awareness and capabilities in improving product quality. materials separately from qualified ones to ensure going into the next process and handle
traceability. them according to review procedures.The Company has also established systematic inspection checklists and quality risk control frameworks continuously
updating assessment criteria testing plans and product standards. By setting and enforcing quality objectives and supervision 05 04
plans STL ensures a systematic and effective approach to quality management continuously enhancing its overall quality After-sales Outgoing
management level. quality goods
management management
Impact and Risk Management
Retest for issues indicated by abnormal feedback compare the Conduct inspections in line with product standards strictly enforce the
To mitigate potential risks related to product quality and safety—such as missing critical quality tests improper handling indicators and generate reports. "Five Prohibitions on Factory Release" and oversee packaging and storage.of non-conforming products reliability of testing results and ineffective execution of quality control measures—STL has Communicate promptly with special customers and establish Collect market feedback implement quality improvements and enhance
implemented a series of proactive management strategies. technical agreements to reduce further issues. customer satisfaction.
44 45Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Innovation to Foster an Excellent Brand
Case Epoxy Propane Awarded "Jiangsu Premium Brand" Certification Case Chief Quality Officer Receives Municipal Honors
On August 28 2024 at the
Jiahong New Materials' epoxy propane product received the "Jiangsu Premium Brand" Jiaxing Quality Enterprise On-
certification marking the third time the Company has earned this distinction after its site Exchange Meeting and the
polycarboxylate superplasticizer series. The Company employs the advanced HPPO Launching Ceremony of 2024
process for epoxy propane production which offers advantages such as minimal pollution "Quality Month" STL's Chief
low energy consumption high atom utilization efficiency and fewer by-products. This Quality Officer was honored as
significantly reduces environmental impact and aligns with sustainability goals. an exemplary representative.This recognition underscores
the Company's leadership in
quality management.Non-Conforming Product Control
STL enforces stringent control measures on non-conforming products to uphold product During the reporting period
quality. If raw or auxiliary materials fail to meet standards the Company conducts
assessments and takes corrective actions such as conditional acceptance return or STL did not experience any
replacement—prioritizing returns whenever possible. During production any identified product recalls due to safety Metrics and Targets
non-conforming intermediate products are immediately investigated with corrective and risks or quality issues.preventive measures implemented to prevent recurrence. For final products that fail to Each facility and business unit at STL has established quality management targets for 2024 covering aspects such as product
meet quality standards the Company adopts rework downgrading or disposal measures. quality raw materials customer satisfaction analysis processes certificates of analysis (COA) production scheduling and
As a rule non-conforming products are not permitted to leave production facilities measurement accuracy. Monthly statistical analysis is conducted to track progress through quality reports ensuring steady
ensuring that defective products do not enter the market and protecting the Company's advancement of quality management initiatives.reputation and product integrity. Target 2024 Achievements
Detection Capability Improvement Intermediate product first-pass quality rate ≥ 98% Achieved
To ensure the reliability of laboratory testing STL continuously verifies and improves testing capabilities through external Final product factory pass rate Achieved
proficiency testing measurement audits inter-laboratory comparisons and internal quality supervision and control. During 100%
the reporting period three subsidiaries established laboratories that meet China National Accreditation Service for Conformity
Assessment (CNAS) standards. Customer complaint resolution rate 100% Achieved
The Lianyungang Base Laboratory has built a comprehensive quality management and assurance system under CNAS No such accidents occurred
accreditation guidelines. It is equipped with over 150 large-scale testing instruments and devices with all inspectors receiving 0 major or higher-level quality incidents throughout the year
professional training and certification. In 2024 the lab expanded its CNAS-accredited testing capacity by adding eight new
testing subjects and 104 additional testing parameters. It now possesses CNAS accreditation for 20 testing subjects and a total
of 180 testing parameters.Product Quality and Safety Training Performance
Quality Culture Development Indicator Unit 2024 2023 2022
STL continuously promotes a culture of quality through ongoing improvements and innovation in quality management
practices. In 2024 various quality management initiatives were implemented across different facilities and business units Training sessions provided session 43 23 6
to strengthen quality awareness and risk control. The Lianyungang Base conducted quality supervision inspections and
product sampling with monthly quality assessments and meetings to analyze and drive continuous improvement effectively Total number of employees trained person-time 1076 825 148
addressing identified quality issues. The Pinghu Base held its first "Quality Month" event featuring awareness campaigns
skills competitions process inspection workshops comparative analysis of standard production lines and activity reviews— Total hours of training provided hour 70.5 43.5 16
enhancing employees' quality management awareness.
46 47Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Innovation to Foster an Excellent Brand
Excellence in Customer Service Smooth Communication with Customers
To ensure that STL can promptly listen to and effectively respond to customer demands and feedback departments maintain close
STL strictly adheres to relevant laws and regulations such as the Law of the People's Republic of China on the Protection of contact with customers through email phone video conferences and on-site visits. Communication is scheduled according to customer
Consumers' Rights and Interests Civil Code of the People's Republic of China and Advertising Law of the People's Republic of availability and needs and for important matters video conferences are conducted for more efficient exchange. Additionally the Company
China. Based on the Management Regulations on the Applied Technology Service of the Marketing Center the Company has has set visitation frequencies according to customer levels to ensure regular interaction with customers of varying tiers and strengthens
established internal documents such as the Sales Contract Management System the Customer Reception Etiquette Guide the face-to-face communication through participation in industry conferences. The Company also emphasizes gathering customer feedback
Customer Relationship Maintenance Implementation Rules the Customer Care Manual and the Logistic Management System and suggestions using them as important references for improving products and services by the R&D and production departments.which provide comprehensive standards and guidance for the construction of the Company's service system. The Company
Annually the Company conducts a specialized survey in the form of a Customer Satisfaction Survey covering dimensions such as
continuously standardizes customer service management optimizes the existing service system and standardizes operations
the STL brand sales services ethical standards technical support after-sales service logistics services and expectations for future
in areas such as customer service contract signing logistics services and payment settlement. In terms of product quality
cooperation. Statistical analysis of the survey shows that STL's customer satisfaction rate is 100% achieving 95.5% of the annual goal.standards the Company follows international and industry standards and gradually progresses towards establishing its own
The Company formulates a satisfaction survey report based on the results provides suggestions for recurring issues or areas with
enterprise standards consistently pursuing product quality improvement to meet customer needs with high-quality products.widespread improvement feedback and incorporates them into the improvement departments' monthly work plans to ensure continuous
In service standards the Company has developed service script manuals and organized staff training effectively improving the
optimization of products and services.service capabilities of business personnel and providing customers with a better and more professional service experience.For customer complaint management the Company has developed the Management System for Customer Complaint Handling
Digital Marketing System and standard processes setting detailed standards and timelines for receiving transmitting responding to reporting and resolving
complaints. This ensures that upon receiving a customer complaint an initial response is immediately provided to acknowledge receipt
STL focuses on the core concept of "customer-centered" and builds standardized process systems through digital and ensure prompt handling of the issue.transformation to continuously enhance business operational capabilities and competitiveness. In 2024 the Company In 2024 the Company received 15 customer complaints with a complaint response rate of 100% and a resolution rate of approximately
introduced a CRM system1 to carry out a marketing digital transformation achieving full digital management of business 80%. Issues related to logistics and labeling were addressed and corresponding improvement and enhancement plans have been
processes covering the entire process from potential customer leads to final payment collection ensuring seamless formulated from the perspectives of processes systems and regulations. In the future STL will continue to focus on customer concerns
connection and smooth processes. The application of the CRM system optimizes business processes customer management and continuously improve service quality.and decision-making support significantly improving operational efficiency and customer experience:
In 2024
Achieve full digital management Response rate to Utilize digital means to classify and customer complaints
from order generation to shipment manage customers and credit im-
enhancing management efficiency proving the precision of customer 100%
through visual monitoring. management.Order Customer Completion rate of
Management Management approximately
80%
Logistics Price and
Support optimization of logistics Optimization Contract Control Obtain price information through
processes enhancing logistics effi- the system and applies it to prod-
ciency and service quality. uct pricing and contract order ex-
ecution ensuring the effective im-
plementation of pricing strategies.
1 CRM（Customer Relationship Management）
48 49Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Innovation to Foster an Excellent Brand
Advancing Responsible Procurement Supplier Risk Assessment Management
To effectively manage supply chain ESG risks STL continuously refines its Procurement Risk Prevention List. The internal control
department of the Business Procurement Center provides ongoing oversight of the entire procurement process ensuring risk control
measures remain effective. Meanwhile the Audit and Supervision Department conducts unannounced audits establishes complaint
channels for supply chain partners and ensures compliance. In 2024 the Business Procurement Center utilized its procurement platform
Sustainable Supply Chain and SRM system to track contract implementation covering delivery notifications receipt monitoring invoice follow-up payment
arrangements and dispute resolution thereby ensuring suppliers deliver quality goods on time.STL has developed the Supplier Management Measures the Procurement Management Regulations the Supplier Performance
Evaluation Systemand the Management Measures for Supplier On-Site Inspection to implement full-process standardized Ethical Procurement
management from supplier admission selection to performance evaluation and exit integrating sustainable development into
every stage of the supply chain. STL places great importance on ensuring transparency fairness and integrity in
supply chain procurement. The Company has developed the Supplier Performance In 2024
Evaluation System the Notice on Integrity Responsibility and the Management The completion rate for
Supplier Admission Supplier Due Diligence and Tiered Management Measures for Procurement Risk Prevention signing the Notice on Integrity signing the Notice on
Responsibility with suppliers and holding training sessions on the supplier Integrity Responsibility
At the supplier admission stage the Company STL implements a scientific supplier performance evaluation system and code of conduct to emphasize the Company's policies on integrity and anti- with suppliers was
implements refined control over the supplier tiered management. With the Business Procurement Center at its core the corruption promoting the basic principles of "sunshine procurement" across all
admission process requiring suppliers to meet Company collaborates with key functions such as quality management and suppliers. Additionally the Business Procurement Center regularly assesses and 100%
all provisions of the Supplier/Contractor Code of demand departments to form a cross-departmental supplier certification reviews procurement employees' professional competence job performance
Conduct. team that conducts comprehensive annual reviews and on-site audits of and professional ethics to continuously enhance their expertise and integrity in
suppliers. Suppliers are required to respond to any non-compliance issues
During the supplier selection process the Company discharging duties.and implement corrective actions to drive continuous improvement.comprehensively evaluates suppliers based on
key product and production capabilities technical STL's supplier evaluation covers performance and market share financial Digital Platform
level and quality assurance capacity. Suppliers status management systems quality assurance capabilities R&D
with certifications for environmental management and equipment capacity ESG management levels and environmental To improve supply chain management and procurement efficiency STL has developed the smart procurement platform SRM
2
systems and occupational health and safety certifications. Based on assessment results suppliers are tiered to ensure system to manage suppliers throughout their lifecycle.management systems are prioritized. Suppliers the stability and sustainability of the supply chain.Since its launch in 2021 the SRM system has streamlined the entire procurement process facilitating smooth data exchange
that have had issues in safety or environmental
across business functions and reducing errors caused by information flow issues. In 2024 the Company officially launched a
protection are subject to a veto policy. After initial In 2024 the Company made significant progress in supplier management
performance management module implemented cross-departmental performance evaluations optimized SRM and visualized
qualification review a supplier certification team completing on-site audits for 36 suppliers and identifying 93 issues all of
which were rectified. Additionally through a rigorous annual performance procurement project reports increasing transparency and enhancing the "sunshine" procurement process through traceable consisting of the procurement quality and demand
evaluation mechanism the Company eliminated 84 suppliers including workflows. The Company has further leveraged this system to enhance its reuse management efforts promoting the utilization departments jointly decides whether sample
those failing on-site audits or not meeting standards after the annual of the idle materials platform. Additionally dedicated task forces have been established to improve delivery execution rates certification and on-site inspection are needed.performance evaluation. optimize e-commerce procurement processes and eliminate ineffective approval nodes in the OA workflow thereby enhancing
procurement efficiency. At present 100% of qualified suppliers have successfully completed online registration.The Company plans to expand its information technology infrastructure further in 2025 increasing e-commerce coverage
Supply Chain Carbon Dioxide Management refining supplier classifications and visualizing procurement quality analysis reports to enhance supply chain informatization
and management accuracy.STL places great emphasis on managing carbon emissions in the supply chain actively launching the Supplier Carbon Dioxide
Management program to enhance control over suppliers' sustainable production practices improve transparency in raw material
procurement and carbon emissions and proactively identify and manage sustainability risks in the supply chain. Supplier Empowerment
The procurement department prioritizes low-carbon and environmentally friendly suppliers and products integrating carbon emission
considerations into procurement decisions to reduce emissions at the source. By setting clear procurement standards and collaborating STL upholds a strategic philosophy of growing alongside key suppliers aiming to enhance the overall quality and efficiency of
with other departments the Company encourages suppliers to implement carbon emission measurement and reduction measures the supply chain through training and exchanges. The Company regularly dispatches technical and quality control personnel to
promoting a low-carbon supply chain. supplier sites providing professional guidance and training to help suppliers improve production management quality control
and supply assurance capabilities. By establishing long-term cooperative relationships the Company and its suppliers jointly
At the same time the Company works closely with customers sharing the group's "4R" green and low-carbon industry model and learn from best practices optimize process flows and ensure the stability of raw material and supply quality. Additionally
engaging in in-depth discussions on carbon reduction calculations plans and other topics to support customers in advancing green the Company periodically organizes seminars and technical exchange meetings to share industry's best practices and drive
supply chain initiatives and achieving ambitious carbon reduction goals contributing to sustainable development. Additionally the coordinated development across the supply chain.Company organizes carbon reduction training for suppliers and partners widely disseminating knowledge and technology related to
carbon reduction to improve the environmental awareness and capability of the entire supply chain. 2 SRM（Supplier Relationship Management）
50 51Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Innovation to Foster an Excellent Brand
Case Supplier ESG Promotion Conference Industry Collaboration and Progress
In August 2024 STL successfully held the "2024 STL ESG Promotion Conference" which attracted active participation
from 2249 suppliers accounting for approximately two-thirds of the Company's qualified suppliers. The training As a leading player in the domestic light hydrocarbon industry STL actively engages in industry dialogues through seminars
covered four core areas: green and low-carbon development safety and environmental protection integrity and industry associations and forums. The Company fosters deep industry collaboration by partnering with value chain enterprises
compliance and shared growth. This initiative conveyed the Company's high standards and strict requirements in ESG to share technological innovations green development practices and explore sustainable pathways for the chemical industry.practices helping suppliers better understand and implement sustainable development principles.Case Memorandum of Understanding Signed with PetroChina International Co. Ltd.Promoting Industry Development On Januar y 12 2024 STL and PetroChina
International Co. Ltd. signed a Memorandum of
Understanding in Beijing marking the beginning
Industry Standards Development of a comprehensive collaboration in the fields of
chemicals natural gas new energy and advanced
STL and its subsidiaries actively participate in drafting and formulating various product standards including national standards for materials. This partnership represents a significant
industrial acrylic acid and esters superabsorbent resins used in diapers and sanitary napkins as well as group standards for refined step in STL's commitment to the national strategy
industrial acrylic acid and by-product hydrogen from propane dehydrogenation. The Company also plays a key role in developing industry of innovation-driven development and industrial
standards for composite absorbent cores used in disposable paper hygiene products. Additionally STL has been actively involved in structure optimization. By working together both
drafting the ESG Disclosure Guidelines for Petrochemical Enterprises and the ESG Disclosure Evaluation Specifications for Petrochemical parties will drive technological innovation expand
Enterprisescontributing to the standardization of ESG disclosures in the industry. As a member of the National Technical Committee markets and upgrade industries exploring new
141 on Paper Industry of Standardization Administration of China its subsidiary Satellite New Materials has participated in the review of business models and collaboration opportunities
three standards including the Absorbent sanitary paper products and raw materials— Evaluation method of deodorant property and to inject fresh momentum into the high-quality
discussions on the Green product assessment—Paper and paper products.Furthermore it has contributed to the formulation of national development of the energy and chemical sector.standards for superabsorbent resins. The Company has also reviewed and provided conclusions for 133 national standards and four
industry standards including the Sanitary product - air-laid thereby supporting the improvement and updating of standards in the paper
industry. Through its extensive involvement in standard-setting initiatives STL sets high benchmarks to drive industry upgrades and foster
continuous industry development.Case Strengthening Cooperation through Industry Exhibitions to Promote Petrochemical Industry Upgrades
Case Inclusion in the First Batch of the "Zhejiang Made" Standards Cultivation Program On September 19 2024 STL participated in the
International Chemical Industry Fair (ICIF CHINA
STL was selected for the first batch of the 2024 "Zhejiang Made" Standards Cultivation Program undertaking the formulation 2024) under the theme "Sharing the Beauty
of standards for industrial methyl acrylate. With its leading production technology and innovation capabilities the Company of Chemistry with the World." The Company
continues to strengthen its advantages and influence in the C3 industry chain. This standard-setting initiative aligns the Company showcased its achievements in green and low-
with Zhejiang Province's high-quality manufacturing development goals enhancing the advancement and applicability of carbon development technological innovation
standards reinforcing collaboration in key industrial chain segments and guiding the industry towards efficient standardized and and digital transformation. During the exhibition
safe development. Additionally it contributes to improving the quality of downstream products in sectors such as architectural STL shared its breakthroughs in key technologies
coatings pharmaceuticals and daily chemicals. STL will adhere to the "Zhejiang Made" standard system framework promote and outlined its future research and development
high-quality standard development deepen brand building enhance the quality of standard supply and implementation and plans. The Company also presented its green
support the sustainable development of the industry. development model within the integrated light
hydrocarbon industrial platform and introduced
the "Nebula" industrial internet platform which
Number of National Standards Number of Industry Standards Number of Group Standards enables smart production through "business
Participated in Formulating Participated in Formulating Participated in Formulating online operational process management risk
visualization and intelligent decision-making."
2024 8 1 4 Through this event the Company engaged with
domestic and international partners to explore
new collaboration opportunities and provide
2023 7 1 3 innovative chemical material solutions for a better
life. This initiative highlights STL's proactive role in
industry exchanges and its leadership in driving
2022 1 1 2 industry advancements.
52 5303 Dual Carbon Goals for Green Development
STL remains steadfast in its commitment to low-carbon development as a core strategy actively aligning with China's "dual carbon"
goals by expanding its deployment of clean technology research and application. The Company integrates the concept of green
development into its production and operations continuously enhancing energy efficiency and synergizing pollution reduction and
carbon mitigation thereby solidifying its green foundation for sustainable growth.Governance STL has established the Strategy and ESG Committee to oversee environmental strategy planning target
setting policy formulation and execution climate risk assessment performance evaluation and information
disclosure. The committee regularly reports to the Board of Directors. At the operational level each base and
business unit implements a comprehensive responsibility management model where the General Manager
holds overall accountability and the HSE Management Department manages environmental affairs to ensure
clear responsibilities and effective execution.Strategy STL has developed a comprehensive "4R" green and low-carbon industrial model—encompassing Carbon
Reduction Carbon Recycle Carbon Reuse and Carbon Replacement—starting from raw materials and extending
across the entire industrial chain. With "green and low carbon" and "technological innovation" as dual engines the
Company is building a green manufacturing system formulating a green hydrogen utilization plan continuously
optimizing its energy structure and establishing a low-carbon value chain to enhance its climate resilience.Goals Increase investments in clean technology development Promote energy efficiency
and reduce energy intensity annually
Based on 2020 as the baseline year STL commits to reducing and achieving value chain carbon
2 neutrality by 2050carbon dioxide emissions by over million tonnes by 2030
Based on 2024 as the baseline year STL commits to reducing Emission intensity of waste gas
wastewater pollutants (including COD ammonia nitrogen) pollutants (including VOCs NOX SO2)
discharge intensity by over 15% by 2027 decreased by 13%
Solid waste generation intensity decreased by Freshwater usage intensity decreased
over 8% by over 4%
Impacts Through its integrated light hydrocarbon industrial chain STL actively deploys clean technologies and low-
UN SDGs risks and
carbon solutions replacing traditional high-carbon raw materials with cleaner alternatives such as ethane
significantly reducing carbon emissions. Additionally the Company promotes green transformation across the
opportunities entire industrial chain through carbon recycling resource circular utilization and hydrogen energy deployment.STL proactively identifies risks—including technological bottlenecks cost pressures regulatory tightening
market volatility and environmental compliance challenges—while also recognizing opportunities such as
technological innovation enhanced market competitiveness policy support and shifting market preferences
taking necessary measures accordingly.Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Dual Carbon Goals for Green Development
Focusing on Low-Carbon Strategies Strengthening Clean Technology R&D
STL is continuously increasing its R&D investments in clean technology striving to drive green and low-carbon transformation
through technological innovation. The Company aims to invest RMB 10 billion over the next five years with over 40% allocated
to research areas including battery raw material substitution low-carbon technology green new material development carbon
Opportunities in Clean Technology capture and utilization and waste treatment and recycling.STL is prioritizing the development of new material solutions for emerging sectors such as new energy vehicles lithium batteries Case Research on Polyethylene Recycling and Utilization
and solar cells to provide green and low-carbon chemical solutions in response to global challenges like climate change and As of the reporting period
environmental pollution. The Company regards the research and application of clean technologies as a core development strategy In alignment with national policies STL has conducted in-depth STL has obtained
continuously advancing its "4R" green industry model—from selecting low-carbon raw materials to end-of-pipe carbon recovery— research on the 14th Five-Year Plan of Action for the Control of Plastic
to pioneer the establishment of a full-scale low-carbon industrial chain. Pollution focusing on the industrial study of polyethylene recycling and 165 patents related
utilization. The Company benchmarks leading petrochemical enterprises to green and low-carbon
"4R" Green Industry Model systematically analyzing their research trajectories in plastic recyclability
research and development
while dynamically tracking technological advancements. STL has also which will provide solid
established collaborative agreements with leading academic institutions support for the dual growth
Carbon to facilitate the commercialization of research findings. Following a
of both operating revenue
and net profit in 2024.Emission Carbon Carbon Carbon Capture Recovery Substitution comprehensive evaluation of various technological pathways STL has Reduction selected a cost-effective carbon-reducing and scalable preparation route
and has initiated relevant projects.Hydrogen Energy Production and Utilization
Strategy
As a key domain in clean energy development hydrogen energy is widely regarded as the optimal pathway for deep
Adoption of light hydrocarbon Increase Research on carbon Layout of hydrogen decarbonization in sectors such as transportation industry and construction. As a leading enterprise in the domestic light
production processes. deployment and dioxide chemical energy production and hydrocarbon industry STL has formulated a green hydrogen utilization plan actively advancing the full-chain development
commissioning technology and utilization.Implement energy-saving of hydrogen production storage transportation and utilization. The Company is planning to construct hydrogen energy of carbon dioxide construction of a
renovation programs to reduce capture and perfect industrial Optimize the structure of integrated utilization demonstration projects transitioning from "light hydrocarbons" to "hydrogen excellence."
product unit consumption. purification units. chain of "carbon energy use and increase
the proportion of
Optimize the structure of energy capture carbon
use and increase the proportion recovery and new
renewable energy use.of clean energy use. energy materials". Selection of clean and Industrial integration
low-carbon raw materials.Project deepening
Plan the development of hydrogen-
Pilot exploration based chemicals foster industrial
Committed to promoting circular chain synergy and establish a
economy and renewable energy green and low-carbon production
Strengths and Achievements Plan a hydrogen utilization demon- utilization within the park providing
demonstration base.stration project within the park green hydrogen to businesses within
the park and reducing carbon
Compared to the coal-based Enable effective carbon capture through carbonate The light hydrocarbon cracking including hydrogen-powered shuttle dioxide emissions from hydrogen
chemical process Satellite utilization: for every 1000 tonnes of carbonate 600 facility will produce 400000 buses for employee commuting and
Chemical's light hydrocarbon tonnes of CO can be consumed. Once fully operation- tonnes of high-purity hydrogen hydrogen energy storage projects.production.
2
process can reduce CO2 emis- al Satellite Chemical's carbonate facilities can recycle annually when fully operational.sions by 91200 tonnes for every approximately 400000 tonnes of CO2 annually. Compared to "grey hydrogen"
10000 tonnes of ethylene pro- this process can reduce CO2
duced and by 85500 tonnes for emissions by 10 million tonnes STL's Green Hydrogen Utilization Plan
every 10000 tonnes of propyl- during production and by an ad-
ene produced. ditional 4.6 million tonnes when
the hydrogen replaces tradition-
al energy sources. STL leverages its light hydrocarbon integrated industrial platform utilizing the abundant high-purity by-product hydrogen
(99.999%) generated from ethane cracking and propane dehydrogenation processes. This directly enables the utilization of
STL's "4R" Green and Low-carbon Industry Model hydrogen energy while effectively achieving low-carbon hydrogen production.
56 57Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Dual Carbon Goals for Green Development
Case Driving Hydrogen Technology Innovation Comprehensive Hydrogen Utilization for Cleaner and to Support Clean Technology Development Case Lower-Carbon Electronic-Grade Hydrogen Peroxide
STL has invested in the construction of a hydrogen Clean Raw Materials Management Capability
loading and unloading platform with a daily Utilizing high-purity hydrogen and oxygen byproducts from Improvement
capacity of 900000 Nm3 at its Lianyungang Base light hydrocarbon cracking STL produces hydrogen peroxide
supplying photovoltaic and hydrogen energy with lower energy consumption and reduced carbon emissions To ensure the Company effectively responds Regularly comb through
enterprises within a 300-kilometer radius. Improve production compared to traditional processesoffering clear energy- to energy-related risks and opportunities key energy-using management technical
In 2024 STL's Scope Ⅲ PSA unit was successfully saving and emissions-reduction advantages.STL continues to strengthen foundational equipment measuring
energy management measures and enhance management energy-
commissioned at its Pinghu base significantly instruments and power the management capabilities of relevant saving training and
enhancing hydrogen production capacity. Clean Processes consumption accounts personnel. establish a sound
By optimizing the hydrogen energy system The Company employs an all-acidic fixed-bed process for to explore energy-saving system of rewards and
balance the base plans to supply high-pressure hydrogen peroxide production eliminating the need for alkali potential and rectify penalties assessment.high-purity hydrogen externally with pipeline and thereby preventing the generation of salt-based impurities problematic points.Internal Energy System Audit
construction now in full progress. and wastewater from neutralization reactions reducing Case Across Bases Establish an online
pollutant discharge. energy management
STL led the development of the group During the reporting period STL's various system to monitor
standard Byproduct Hydrogen from Propane Clean Applications bases and business units jointly conducted real-time energy
Dehydrogenation (T/CPCIF 0337—2024) which Electronic-grade hydrogen peroxide decomposes into oxygen an internal cross-audit of the energy consumption at each
was officially released and implemented in and water during circuit board cleaning making it non-toxic management system. External audit base and rationally
June 2024 further standardizing the production harmless and free from residual contaminants that could experts were invited for on-site guidance schedule production and
and application of byproduct hydrogen from pollute water sources offering superior environmental enabling cross-base collaboration mutual maintenance plans.propane dehydrogenation and promoting its benefits compared to previous-generation ozone-based learning and gap identification which
high-value utilization. cleaning solutions. further optimized the operation of the
energy management system.Efficient Energy Utilization STL's Energy Management Measures
Governance
STL strictly complies with national energy regulations including the Law of the People's Republic of China on Energy Impact and Risk Management
Conservation the Electric Power Law of the People's Republic of China and the Management Measures for Energy STL's bases and business units actively identify energy-related risks and opportunities and develop corresponding response
Standardization continuously improving its energy management system to enhance energy efficiency. The Company has measures.formulated a corporate-level Energy Management System with each base and business unit tailoring and updating energy
management procedures including measurement & statistics conservation retrofits consumption quotas and improvement Risk/Opportunity Type Measures
initiatives based on their specific energy usage conditions.Regulatory * Regularly identify and benchmark against laws and regulations
Energy management is fully integrated into STL's ESG framework with General Managers of each base and business unit compliance risk monitor industry economic trends and ensure compliant operations
responsible for energy strategy formulation target setting and usage supervision while production technology teams oversee
energy-saving projects energy measurement and equipment efficiency monitoring. The Company conducts energy audits * Monitor government policies adjust production accordingly and
at least every five years comprehensively reviewing energy usage and management processes across metrics including Energy supply develop emergency response plans to mitigate risks of energy supply
energy measurement statistics and quota assessment management identifying potential energy-saving opportunities and Risks constraints disruptions
implementing targeted improvement measures to effectively enhance energy utilization efficiency.Energy cost * Maintain communication with energy suppliers explore alternative
During the reporting periodSTL achieved 100% coverage of its operational sites with ISO 50001 energy fluctuations energy sources such as renewable energy and enhance risk resistance
management system certification GB/T 23331 and RB/T 114 energy management system certification.* Conduct evaluations and analyses based on energy types develop
Energy savings to reduce
production costs corresponding strategies and plans and identify energy-saving
Key potential
Performance Opportunities
Indicators Reduced unit energy * Enhance energy management and technological efficiency to
MANAGEMENT SYSTEM MANAGEMENT SYSTEM
CNAS C015-M CNAS C015-M
GB/T23331 GB/T23331
consumption to improve
product competitiveness optimize energy usage
5859
GB/T23331
GB/T23331Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Dual Carbon Goals for Green Development
Strategies Case Development of "Ethylene Cold Box" for Energy Recovery and Utilization
STL focuses on the efficient use of energy across all stages of production and operations implementing energy-saving and Through a three-year collaboration with process design institutes and patent holders STL successfully developed the
carbon reduction strategies from the design and construction phases to production recycling and reuse. The Company largest "Ethylene Cold Box" in China. This technology recovers and stores energy generated during the conversion of
continuously increases the proportion of renewable energy usage and innovates in carbon capture and utilization technologies low-temperature ethane to ambient-temperature ethane forming a globally advanced "low-temperature cold energy"
to drive its low-carbon development. recovery system. Thanks to this innovation STL's Lianyungang Base saves over 300000 tonnes of standard coal
annually significantly reducing energy consumption and carbon emissions.In 2024 the Ministry of Industry and Information During the reporting period
Technology (MIIT) announced the list of 2023 Energy STL invested over RMB
Efficiency Leaders. STL's wholly-owned subsidiary
Design Phase Construction Phase Production Phase Lianyungang Petrochemical topped the Energy 50 million in energy
Honors Efficiency Leaders list in ethylene and ethylene glycol Key efficiency improvements
Utilize low-carbon light Procure low-energy consumption Enhance energy-saving and and with unit energy consumption approximately Performance
hydrocarbons as raw materials and low-carbon equipment and carbon-reduction levels Awards Indicators
for chemical production. building materials to achieve
achieving electricity savings
through process innovation of the national benchmark.carbon reduction goals. 60%and equipment upgrades. of 750000 kWh.Driving Energy Conservation and Emission Reduction Clean Energy Utilization
STL is committed to optimizing its energy consumption
Each year STL's bases and business units develop energy efficiency improvement plans based on their energy consumption
structure and continuously exploring opportunities
conditions. They establish annual energy management targets including total energy consumption unit energy consumption During the reporting period
to expand renewable energy use. Through distributed
per product and energy-saving goals. The Company regularly tracks and assesses progress to ensure orderly achievement of
photovoltaic (PV) installations and green electricity
targets. Purchased a total of MWh
procurement the Company steadily increases its 765024
renewable energy ratio. of new energy electricity accounting for 13%
STL's 2024 energy conservation measures The Company has also implemented a biogas recovery Key of total purchased electricityPerformance
project at the anaerobic section of wastewater Indicators
Implemented eight energy efficiency treatment plants delivering 4.92 million cubic meters Implemented a heat pump waste heat
improvement projects including waste of captured biogas to boiler systems as clean energy.Generated 1772906 kWh from rooftop
recovery project for steam generation.heat recovery at the air compression This initiative effectively enhances resource utilization
photovoltaic power stations
Estimated annual operation of 8000
station nitrogen system process efficiency while reducing reliance on external energy Lianyungang hours could recover 21360 MW of
optimization and boiler feed pump Jiaxing Base sources.Base waste heat equivalent to saving 2624
optimization. Introduction of new tonnes of standard coal and reducing
energy-saving equipment resulting in CO2 emissions by approximately 6927
a 10% year-on-year reduction in energy tonnes per year Carbon Capture and Utilization
consumption
STL is actively advancing the development of a resource recycling industry pioneering the construction of a "zero-carbon" new
energy and new materials industry chain. Through carbon capture utilization and storage (CCUS) technology the Company
simulates photosynthesis to capture and recover CO2 emitted from its facilities. This CO2 is then used to produce carbonates Implemented measures such as
Conducted five key energy-saving a crucial raw material for lithium battery electrolytes effectively transforming carbon into value. With a CO2 recovery and optimizing production schedules
and emission reduction projects. By conversion rate nearing 100% STL is innovating a green industrial pathway to achieve carbon neutrality.upgrading the circulating water
optimizing the acrylic acid production system minimizing energy losses
process increased surplus steam STL
Pinghu Base due to equipment failures optimizing As of the end of the reporting period
output by 50000 tonnes equivalent Technology Currently STL has commissioned a CO2 purification unit at power distribution and modifying
to saving 4761 tonnes of standard coal STL had captured and utilized a total of its Lianyungang Base with an annual CO capture capacity of the heat-tracing water system. These 2
and reducing CO2 emissions by 15350 Key 300000 tonnes. Additionally STL has integrated a food-grade efforts led to a 3.38% reduction in unit
tonnes Performance 4200 tonnes of CO2. CO production unit at its Lianyungang Base further recycling product energy consumption 2Indicators by-product CO2 while reducing greenhouse gas emissions.
60 61Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Dual Carbon Goals for Green Development
STL's green office initiatives
Metrics and Targets Energy conservation and efficiency Resource conservation
Strictly enforcing air conditioning temperature Promoting double-sided printing and recycling
STL's 2024 energy use KPIs and targets were accomplished as follows: standards: no lower than 26°C in summer and no higher reusable paper
than 18°C in winter
Energy Management Targets 2024 Progress Encouraging paperless operations through OA approval
Fully adopting energy-saving lighting to reduce energy systems and Outlook emails
Reduce total energy consumption by 3% in 2024 Actual reduction: 3.38% consumption
Upgrading non-explosion-proof area streetlights in Increasing the reuse of office supplies such as paper
Reduce energy consumption per unit of product by 1.2% in 2024 Actual reduction: 2.5% certain production bases to solar-powered streetlights clips binder clips staplers scissors and glue sticks to eliminate waste
Enhancing electricity management policies including
regulating lighting air conditioning and equipment Advocating department-wide sharing of resources such
operation times as drinking water and printers to minimize redundancy
In 2025 the company plans to promote a number of energy-saving renovation projects covering production process optimization
energy recycling equipment energy efficiency improvement and other aspects and is expected to save about 100000 tonnes of
steam and about 5 million kilowatt-hours of electricity reducing energy costs. To enhance employees' awareness and capability in environmental protection and energy conservation STL organizes relevant
training programs annually promoting environmental and energy management policies and concepts. In 2024 the Company
conducted training sessions on international standards such as ISO 14064 ISO 14067 and ISO 14068 to systematically improve
employees' expertise in greenhouse gas accounting verification and emission reduction. Additionally STL's Lianyungang Base
STL's energy consumption overview provided specialized training on Fundamentals of Energy Management for engineers and hosted low-carbon awareness training for
all employees significantly enhancing energy conservation knowledge and skills through a combination of theory and practice.Indicators Unit 2024 2023 2022
Direct Energy Consumption Building a Green Value Chain
Gasoline liter 598995.39 546684.92 454166.89 STL actively explores the use of clean raw materials for chemical production innovating through its "light hydrocarbon
integration" platform to drive green and low-carbon transformation from the source.Diesel liter 297574.26 283915.29 315887.76
Natural gas cubic meter 277614769.39 279519427.80 143216462.10 Strategy Measures Advantages Achievements
Ethane tonne 63151.18 38684.77 94656.25
Indirect Energy Consumption Using clean raw Ethane cr acking STL's two ethane cracking units (1.25 million tonnes/year materials such as emits only 1/10 of each) reduce approximately 22.8 million tonnes of CO2
Purchased electricity MWh 5276353.19 5046442.25 4136774.79 Low-carbon ethane and pro- the carbon emis- emissions annually while its two propane dehydrogenation
raw material pane to replace sions compared to
Purchased steam GJ 13559044.66 13299954.16 4637155.50 traditional feed- coal-based olefin (PDH) units (450000 tonnes/year each) cut CO2 emissions by utilization
stocks like naph- routes per tonne of 7.7 million tonnes annually totaling over 30 million tonnes
Clean Energy Consumption tha and coal ethylene produced of CO2 reductions per year
Purchased renewable electricity MWh 765023.99 517585.28 469828.48
Installed solar capacity MW Hydrogen produc-1.6 1.6 1.6 tion via this method
Solar power generation MWh 1772.91 1887.40 104.64 Utilizing high-pu- emits only 5% of The Company currently has an annual hydrogen production
Low-carbon r i t y h y d r o g e n the carbon emis- capacity of approximately 163600 tonnes. In the future its
Other clean energy utilization MWh 40000 0 0 raw material p r o d u c e d a s a sions of natural gas-byproduct from bas e d hydrogen hydrogen capacity will reach 400000 tonnes/year making it
manufacturing light hydrocarbon p r o d u c t i o n a n d the largest "green hydrogen" supplier in chemical industry
cracking 2.6% of coal-based clusters
hydrogen produc-
tion
Low-Carbon Office and Operations
Promoting Green Operations
Logistics and transportation are also key elements of STL's green value chain. The Company actively collaborates with partners
STL integrates green and low-carbon concepts into daily office operations by continuously implementing various green to explore green management practices in logistics and warehousing reducing resource consumption and carbon emissions.office measures encouraging employees to adopt resource-efficient and low-carbon working practices. In 2024 STL continued implementing its shared pallet program achieving a cumulative total of 87892 pallet cycles.
62 63Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Dual Carbon Goals for Green Development
Addressing Climate Change Climate Risks and Opportunities
STL conducts scenario analysis based on the Intergovernmental Panel on Climate Change (IPCC) Representative Concentration
Pathways (RCPs) SSP5-8.5 (high carbon scenario). The Company comprehensively identifies potential physical risks in the
Governance short-term (by 2030) medium-term (by 2050) and long-term (by 2080) as shown in the table below:
STL places great emphasis on climate-related risks and opportunities. The Company integrates climate change matters into
its ESG management system with the Board overseeing and making decisions on the development of climate change-related Category Risk Description Response Severity Impact Period
strategies and targets. The Strategy and ESG Committee is responsible for identifying evaluating and managing climate-
related risks and guiding the formulation of strategies and management policies to address climate change while overseeing
Intense rainfall may lead
the identification of climate-related risks and opportunities. Each base and business unit is responsible for executing and to flooding equipment
implementing specific action plans. failure plant water accu- * Develop emergency plans for pro-
mulation transportation
The Company regularly organizes climate and carbon-related training to enhance the professional capabilities of employees in duction safety accidents fires and Extreme disruption production environmental incidents caused by Short-term medium-
relevant positions ensuring they are equipped to participate in the formulation and implementation of the Company's climate- precipitation interruption and safety Mediumextreme weather; conduct regular term long-term
related strategies. In 2024 the Company provided specialized training to relevant departments covering carbon inventory incidents resulting in drills
carbon systems carbon footprints and more. reduced capacity and
increased operational * Pre-prepare emergency supplies
costs. optimize basic infrastructure such
Training Topic Participants as water systems at production
bases
ISO 14064-1:2018 system implementation and carbon inventory training 30 * Regularly inspect and maintain
High temperatures may equipment and facilities
increase energy costs fire * Implement emergency logistics
ISO 14067 product carbon footprint training 20 Acute risks Extreme heat risks and reduce work measures to improve logistics Medium Short-term medium-
efficiency resulting in timeliness under extreme weather term long-term
higher operational costs
Carbon Management System Requirements and Guidelines TCIECCPA002-2021 training 20 * Guide employees to respond to extreme weather and minimize
impacts on assets and personnel
safety
Strong winds and heavy * Conduct climate forecasting and
rain from cyclones may reporting adjust offline operations
Strategy cause equipment failure and employee commuting policies
Tropical infrastructure damage and implement emergency logis-
STL fully identifies the potential impacts of climate change on its production operations as well as the new opportunities cyclones transportation disruption tics measures based on weather High Medium-term
for technological innovation and green transformation that it presents. The Company references various climate change and safety incidents lead- changes
ing to reduced capacity
scenarios and considering its operational characteristics has identified potential physical risks transition risks and transition and increased operational
opportunities and formulated targeted response strategies to enhance the Company's climate resilience. At the same time costs
STL has incorporated climate risks into its overall risk management system integrating climate change risks deeply with
the Company's overall risk management process. The Company actively evaluates manages and tracks climate-related
performance indicators to quantify risks and effectively drive risk control.Water scarcity may affect
To promote the Company's green transformation and achieve scientific systematic carbon management STL actively conducts * Continuously optimize production production stability lead- processes actively use water recy-
product carbon footprint assessments and has established a carbon emission management platform. During the reporting Water shortage ing to reduced capacity cling technology and improve water Medium Medium-term long-term
period the Company completed carbon footprint certification for five products: acrylic acid refined acrylic acid butyl acrylate and higher operational efficiency
isooctyl acrylate and ethyl acrylate and launched the carbon emission management platform. costs
Chronic risks
Case Establishing a Carbon Emission Management Platform to Support the Achievement of "Dual Carbon" Goals
* Continuously monitor climate
Affects the safety and
In response to the national carbon peak and carbon neutrality strategy STL successfully built a carbon emission information optimize the layout of stability of coastal pro-
management platform in November 2024. The platform was developed in strict accordance with the ISO 14064- production bases and warehouses duction bases potential- based on sea level rise trends Low to
1 standard and includes four core functional modules: activity data entry parameter settings data analysis and Sea level rise ly leading to production medium Long-term
stoppage relocation * Strengthen flood prevention and report generation. It efficiently supports the accurate accounting and trend analysis of Scope 1 2 and 3 emissions. disaster resistance capabilities of
The platform also visualizes key data such as carbon emissions intensity and structural proportions providing and property loss infrastructure
informational support for the Company's "dual carbon" management decisions.
64 65Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Dual Carbon Goals for Green Development
At the same time the Company identifies potential transition risks and opportunities from policy market technology and Category Risk Description Response
reputation perspectives and formulates corresponding strategies. To promote green and low-carbon develop- We closely monitor the government's
ment the government has introduced policies relevant policies and actively re-
providing financial subsidies tax reductions spond to and participate in incentive
low-interest loans and other incentives to or subsidy programs. For example
Category Risk Description Response
Policy encourage corporate green transformation. the 2025 Tarif f Adjustment Plan
opportunities Policy incentives issued by the State Council in 2024 China's national carbon emissions trading We launch energy saving and emis- has reduced production costs for the
market has been launched with the carbon quo- sion reduction initiatives across the Company by supporting the contin-
ta system being strictly enforced. Key carbon-in- board and are committed to signif- ued implementation of the low-car-
tensive industries such as petrochemicals may icantly reducing our Scope 1 Scope bon ethylene production process via
be mandatorily included which means that the 2 and Scope 3 emissions. ethane cracking.carbon emissions compliance pressure on the
Company will rise sharply. To meet the new emis- Implementing low-carbon production will We proactively identify energy-sav-
sion standards the Company may need to make drive the development of industrial ener- ing potential and continuously re-
Carbon tax/ pricing large-scale investments in emission reduction Transition gy-saving technologies and energy-efficient duce product energy consumption
technologies purchase huge amounts of carbon opportunities Technology Low-carbon equipment manufacturing creating oppor- and usage costs through technologi-
allowances and may even face difficulties such opportunities technological tunities for the Company to improve energy cal innovation process optimization
as production restrictions. This shift will greatly innovation efficiency and reduce energy usage costs. the application of energy-saving
increase the cost of our carbon emissions com- equipment and technologies and
pliance and may also have far-reaching impacts
Policy and carbon capture.on our strategic planning operation mode and
legal risks market competitiveness. The development of green finance and sus- We continue to innovate in the
tainable investment provides new financing fields of new energy materials and
channels for the Company's green projects. At comprehensive utilization of carbon
Against the backdrop of the "dual carbon" goals Relying on our integrated light hy- Market Market preferences the same time the growing market demand dioxide while also resourcefully
the government is considering the introduction drocarbon industry platform we opportunities for green and low-carbon products will con- utilizing hydrogen as a byproduct
of more rigorous laws and regulations to limit or have established a "4R" green and tribute to increased revenue from the Compa- building a green and low-carbon "in-
Requirements and even reduce companies' carbon emissions. This low-carbon industrial model that ny's green materials segment. dustrial chain."
regulation imposed on initiative poses compliance risks for carbon-in- spans the entire industrial chain
existing products and tensive and energy-intensive industries leading and are committed to promoting the
services to investment in energy-saving and emission green and low-carbon development
reduction technological transformations. This of the olefin industry. Metrics and Targets
will significantly increase our operational com-
pliance costs. STL has established ambitious carbon reduction targets based on its production and operational situation and conducts annual
greenhouse gas inventory assessments to monitor and quantify progress toward these targets.Transition As society focuses more on climate change Leveraging the low-carbon industri-
risks and sustainable development a growing al model we insist on promoting the Carbon Reduction Target 2024 Progress
number of consumers show a preference for R&D and production of low-carbon
Changes in customer green and low-carbon products and servic- products and transferring low-car- Reduce cumulative CO2 emissions
behavior es making it imperative for the Company to bon attributes to customers and by over 2 million tonnes by 2030 Reduced CO2 emissions by 1014581 tonnes (with 2020 as the
increase its investment in the research devel- end-use scenarios in the value chain. (with 2020 as the baseline year) baseline year)
opment and application of green and low-car-
bon technologies.Market risks
Continuously implement 4 key strategic plans including clean energy
Climate change may restrict production from Monitor raw material market price Achieve carbon neutrality in the usage low-carbon technology innovation production equipment
raw material suppliers leading to shortages. fluctuations establish early stock- value chain by 2050 and process optimization and decarbonizing supply chains as
Additionally the global energy transition may piles innovate technologies seek al-
Growing raw material detailed in the "Focusing on Low-Carbon Strategies" section.drive up the prices of energy and water rais- ternative materials and energy and
cost ing raw material costs and production costs. build a diversified supply network to
ensure supply chain stability.STL greenhouse gas emission
To adapt to the transition towards low-carbon We have established a sound mech- Indicator Unit 20241 20232 2022
economy the Company need to continuously anism for the application of low-car-
Costs resulting from ramp up its research and development efforts bon technologies and assessed such Direct emissions (Scope 1) Tonnes of CO equivalent 1664427 1432410 2211164Technology transition towards low- and investment in key areas such as renew- technologies through feasibility
2
risks carbon technologies able energy energy-saving and emission studies and cost analysis to reduce Indirect emissions (Scope 2) Tonnes of CO2 equivalent 4521154 4420767 1606223reduction technologies which means higher the transition costs.technological research and development Total greenhouse gas emissions Tonnes of CO2 equivalent 6185581 5853177 3817387
costs.Greenhouse gas emission Tonnes of CO2 equivalent/ 0.502 0.627 0.624
Stakeholders increasingly focus on the Com- We regularly summarize the requests intensity tonne of product
pany's actions to address climate change and inquiries from various stake-
Reputation Growing stake
holder concerns and making it imperative for us to take relevant holders and actively address their
1 The scope of the 2024 STL greenhouse gas emissions data reporting includes both Scope 1 and Scope 2 emissions. The Company conducts its
risks negative feedback initiatives otherwise our reputation will be concerns through channels such as accounting in accordance with the requirements outlined in the Greenhouse Gas Emission Accounting Methods and Reporting Guidelines for affected. our official website announcements Chinese Chemical Production Enterprises (Trial) with emission factors referenced from the data provided in the aforementioned Guide.visits and research. 22023 emission data was updated with verification.
66 67Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Dual Carbon Goals for Green Development
Strengthening Environmental Impact and Risk ManagementSTL strictly implements the three-step process for environmental protection which requires environmental impact assessments
Management and environmental acceptance inspections for new modified or expanded projects. This ensures that environmental risks are effectively controlled from the design and construction stages. Additionally the Company reduces environmental risks during
production operations through measures such as environmental risk identification pollutant control environmental monitoring
audits and environmental emergency management.Environmental Management System Management Measures Frequency Specific Content Coverage
Environmental
STL strictly adheres to the Environmental Protection Law of the People's Republic of China the Law of the People's Republic risk Annually * Conducting annual environmental factor identification and recording in the
of China on Environmental Impact Assessment the Law of the People's Republic of China on the Prevention and Control of identification information management system
Atmospheric Pollution the Law of the People's Republic of China on the Prevention and Control of Water Pollution the Law
of the People's Republic of China on the Prevention and Control of Environmental Pollution by Solid Wastes the Law of the * Tracing pollution sources: in-depth inspection and rectification of VOCs and odor
People's Republic of China on Prevention and Control of Soil Pollution and other related laws and regulations. The Company sources conducting LDAR tests
also complies with industry standards such as the Emission Standard of Pollutants for Petroleum Chemistry Industry and the * Standardizing pollution discharge and monitoring: implementing requirements
Emission Standard of Pollutants for Synthetic Resin Industry. Additionally the Company implements the policies and standards Pollutant Daily in the pollution discharge permit and monthly third-party monitoring of pollution
set by the local authorities including the Ultra-low Emission Transformation (In-depth Treatment) Work Plan for Key Industries control data
and Facilities in Lianyungang City the Notice on Leakage Detection and Repair (LDAR) the Emission Standards for Major Water * Pollutant online monitoring: using environmental monitoring platforms and MES
Pollutants in the Chemical Industry the Emission Standards for Volatile Organic Compounds in the Chemical Industry in systems to monitor the operation of environmental protection facilities and ensure All
Jiangsu Province and other control requirements that are much more demanding than national standards. normal stable operation and compliance with discharge standards business
areas
Annually * Conducting internal audits and external reviews for all business units and Environmental comprehensive external audits for certification changes every three years
supervision and
Governance audits
Weekly * Conducting weekly environmental risk checks and rectifying identified environmental hazards in a timely manner
STL continually improves its environmental management system by establishing various institutional documents such as the
Environmental Protection Responsibility System the Safety and Environmental Protection Facilities Management System the * Developing emergency response plans for environmental incidents categorizing
Management Requirements for Environmental Factor Identification Evaluation and Control Procedure and the Management potential events and updating plans as necessary based on operational and external Environmental
Requirements for Environmental Hazards. The Company also enforces detailed implementation rules for the prevention and factorsemergency As needed
control of air water solid waste soil and noise pollution. management * Responding to regional heavy pollution weather policies and developing site-specific strategies
The Company closely monitors the release and updates of environmental laws and standards. During the reporting period the * Regularly conducting emergency drills as per the emergency response plan
Company identified new environmental policies such as the modification of the Emission Standard of Pollutants for Petroleum
Chemistry Industry (GB31571-2015) the Emission Standard of Pollutants for Synthetic Resin Industry (GB31572-2015) and the
Regulation on the Administration of Permitting of Pollutant Discharges. The Company promptly organized analysis and study Clean Production Audit to Promote Comprehensive
sessions on these new regulations at its bases and business units to ensure compliance with environmental management and Case Improvements in Production and Environmental Management During the reporting period
pollutant discharge standards.During the reporting period Jiahong New Material conducted a clean the Company carried out
To ensure the proper functioning of the Company's environmental management system an environmental management production audit and actively implemented clean production plans. Out several environmental audits
structure was established led by the Company's Strategy and ESG Committee. The Safety and Environmental Committee of 14 proposed measures 13 have been implemented. By strengthening covering 100% of its
oversees all environmental management tasks and conducts inspections and evaluations of each base and business unit in management and technological advancements the Company achieved
Key
Performance operational areas with all
accordance with the Management Measures for Safety and Environmental Performance Assessment. The primary managers effective resource conservation pollutant reduction and cost reduction all Indicators identified environmental
of each base and business unit are designated as the primary responsible persons for environmental protection and are while mitigating environmental risks. hazards being rectified.fully accountable for the environmental protection work in their respective units. Additionally dedicated environmental
management departments are established to supervise inspect evaluate and serve in relation to environmental protection in
the production areas.Environmental Capacity Building
The Company continues to strengthen the environmental management responsibilities at all levels of the Company
incorporating 21 performance indicators into annual evaluations including total water usage pollutant discharge volumes STL regularly conducts environmental protection training inviting professional instructors to provide in-depth explanations
and waste disposal compliance rates. Responsibilities cascade from executive directors to frontline team employees through of environmental laws and regulations and promoting Company environmental protection policies. This training enhances
signing environmental protection responsibility letters and KPIs. This approach helps solidify environmental protection employees' understanding and capabilities in pollutant discharge management emergency management and self-monitoring.accountability and improves the management of production pollutant discharge environmental hazard identification and The Company also actively organizes environmental protection training and publicity activities for all employees fostering a
rectification and emergency management. corporate culture where environmental protection is embraced by everyone.
68 69Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Dual Carbon Goals for Green Development
Organizing the "6?5 World Environment Day" Event to
Case Encourage Employees' Participation in "Zero Waste
During the reporting period Wastewater Discharge ManagementCity" Initiatives
STL Lianyungang Petrochemical and
On June 5 2024 World Environment Day the Jiaxing base Pinghu Petro Chemical received the Adhering to the "zero and direct discharge of sewage" goal STL continues to enhance its risk prevention and control measures
hosted the "I Participate in Zero Waste" event. Over 400 title of National Green Factory while against water pollution and strictly manage the entire wastewater production process including generation collection reuse
employees received promotional materials and learned about Youlian Chemistry earned the title of and discharge thus optimizing processes to reduce pollutant concentrations. Wastewater pollutants are closely monitored
the significance of building a zero-waste city solid waste Municipal Green Factory. to ensure compliance with discharge standards and to effectively control water body risks. Each of the Company's bases and
regulations and more. The event encouraged employees to Honors business units implements a rainwater and wastewater diversion system equipped with wastewater treatment facilities and
engage in waste reduction activities. Furthermore Jiaxing and Lianyungang Petrochemical
Awards reclaimed water systems to treat various wastewater types including oil-containing wastewater process wastewater saline base distributed 100 eco-friendly bags to staff guiding and Jiahong New Material were wastewater clean wastewater initial rainwater washing water and domestic wastewater. This reduces wastewater generation
them to reduce single-use plastic and actively participate awarded the title of "Demonstrative
in the "Zero Waste City" initiative promoting a waste-free Enterprises on Environmental and discharge volumes.philosophy. Protection in Lianyungang City."
01 * In accordance with the 03 * Enhance the s ewage principle of "rainwater and treatment capacity and sewage diversion" collect closely monitor the water Metrics and Targets wastewater in a catego- quality indicators such
rized manner including as chemical oxygen de-
The Company achieved the following key environmental performance indicators for 2024: Source control enterpr ise produc tion Enhanced handling mand ammonia nitrogen
wastewater clean waste- and total nitrogen of the
water rainwater etc. treated wastewater to
Environmental Management Targets Achievement * Real-time monitoring of * Adoption of "Combined ensure that the discharge
water pollutant discharges * Effectively collected and + Blending + Anaerobic + standards are met
through environmental on- incorporated into a sew- Aerobic" biological treat-
0 Environmental incidents Achieved line monitoring facilities to age station for centralized ment process for target-
ensure real-time monitor- treatment. ed treatment of acrylic
ing of water quality data. acid wastewater.Total pollutant discharge within approved limits Achieved
* Wastewater is treated
Categorized collection through the device and Compliance emissions
0 non-normal operation of environmental facilities Achieved * Optimize the production reused after treatment
process strengthen pro- to reduce the amount of
cess control reduce the wastewater.
100% environmental monitoring compliance Achieved amount of wastewater
generated.
100% hazardous waste disposal compliance rate Achieved 02 04
STL's Comprehensive Wastewater Management Measures
Case 2024 Wastewater Management Measures
Key Performance Indicators：
Indicators Unit 2024 2023 2022 Developed an acrylic acid refining process that does not use an azeotrope agent throughout the entire Pinghu process compared to traditional methods. This reduces the average wastewater generated per tonne of
Base
ISO 14001 Certification % 100 100 100 acrylic acid produced by 60%.Total investment in environmental
treatment RMB million 130957 170465 142857 Enhanced monitoring of the rainwater discharge system quickly identifying and alerting high COD data Jiaxing
Time invested in environmental from laboratory analyses. Root cause investigations were promptly initiated to accurately pinpoint leakage
treatment hour 61320 74400 62130
Base
and problem sources ensuring compliant rainwater discharge.Environmental protection training
hours hour 2544 6504 4821 Developed a self-made homogeneous catalyst for vinyl carbonate surpassing commercial catalysts in
Number of environmental protection STLsection 356 499 1826 Technology performance. The catalyst achieves 99.6% conversion rate and selectivity under a low water ratio of 1.2:1. training sessions Based on this the SEGMA process was developed to reduce wastewater generation.Number of environmental protection
training participants person-time 17792 45548 31255
Environmental punishment Built a recycled water facility and implemented internal treatment and reuse of production wastewater
accidents time 0 0 0
Lianyungang with a wastewater reuse rate exceeding 90%. In 2024 the wastewater discharge volume was reduced by
Base
Environmental punishment approximately 40000 m3.payments RMB 0 0 0
70 71Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Dual Carbon Goals for Green Development
Metrics and Targets Exhaust Gas Emission Management
STL is committed to continuously reducing the total volume of wastewater and the intensity of wastewater pollutant emissions.The following goals have been set and are continuously monitored: STL is dedicated to reducing air emissions during production and operations. The Company continuously optimizes air
Indicators Target Achievement treatment processes and installs high-efficiency air treatment equipment to effectively treat pollutants such as Volatile Organic
Compounds (VOCs) Sulfur Dioxide (SO2) Nitrogen Oxides (NOx) and particulate matter. Additionally STL ensures the stable
Wastewater pollutant Reduced by over 15% operation of air treatment facilities and compliance with emission standards through online monitoring and monthly third-
emission intensity by 2027 with 2024 as In progress party testing.(including COD and
ammonia nitrogen) the baseline year
01 Water-based product * Adopt "water spraying + honeycomb carbon adsorption" for filling exhaust collection and treatment
STL's wastewater discharge
Indicators Unit 2024 2023 2022
Total industrial wastewater discharge tonne 13116771.18 14627048.12 10713674.84
02 Workspace exhaust from fat washing and baling jobs * Collection and treatment by honeycomb carbon adsorption device
Chemical oxygen demand (COD) tonne 2765.37 2355.96 1523.13
Ammoniacal Nitrogen (NH3-N) tonne 31.52 26.85 6.70
Total oOrganic carbon (TOC) tonne 198.29 103.40 92.59
COD emission intensity3 tonne/10000 2.245 2.077 2.016 03 Cracker flue gas * Treatment with SCR denitrification and trap dust removaltonne products
NH3-N emission intensity4
tonne/10000
tonne products 0.026 0.024 0.009
TOC emission intensity5 tonne/10000 tonne products 0.161 0.096 0.123
04 Workspace exhaust from the drum washing room * Water spraying is used to meet the emission standards
* Adopt "SNCR denitrification + waste heat recovery + cyclone dust
05 Exhaust gas from waste liquid incineration removal + compound acute cooling absorption + electrostatic dust
removal" treatment process for treatment
06 Organic storage tank exhaust * Adoption of RTO furnace CO furnace incineration treatment and process exhaust condensation recovery + activated carbon adsorption
07 Wastewater treatment station * Adopt "biofilter + acid spray + alkali spray + activated carbon odor exhaust adsorption (emergency)" for treatment
3-5 The Company is actively promoting the construction and optimization of relevant supporting wastewater treatment facilities in order to reduce the STL's Main Exhaust Gas Treatment Initiatives
impact on the environment and to achieve coordination between business development and environmental protection.
72 73Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Dual Carbon Goals for Green Development
Case STL 2024 Air Emission Management Measures STL's exhaust gas emission performance overview
Indicators Unit 2024 2023 2022
Source Reduction
Total exhaust gas emissions m3 34746113764 15006541886 /
Launched a green energy-saving retrofit project conducting optimization upgrade and modification
Pinghu of acrylic acid production lines. New green chemical agents replaced traditional azeotropic solvents Emissions of volatile organic compounds (VOCs) tonne 310.38 278.85 190.47 Base
effectively reducing process-related air emissions.Emissions of nitrogen oxides (NOx) tonne 758.17 312.71 576.86
Process Optimization Emissions of sulfur dioxide (SO2) tonne 81.92 42.07 72.55
Installed low-nitrogen combustion + SCR de-NOxtechnology in the cracking furnace and startup boiler Emissions of particulate matter (PM) tonne 53.06 38.21 49.13
Lianyungang units using imported catalysts. This reduced NOx emissions in flue gas to <40 mg/Nm3 (national standard:
Base 100 mg/Nm3) meeting petrochemical pollutant emission standards and ultra-low emission concentration VOCs emission intensity tonne/10000 tonne products 0.252 0.257 0.256
requirements.NOX emission intensity6
tonne/10000
tonne products 0.616 0.554 0.776
Upgraded the process gas treatment system in the multi-alcohol plant replacing the catalytic incineration
Pinghu SO2 emission intensity
tonne/10000
0.0670.1060.098
Base system with a superheated furnace incineration system. This boosted VOCs removal efficiency from 97% to
tonne products
over 99.99%. PM emission intensity tonne/10000 tonne products 0.043 0.054 0.066
Monitoring Improvements
Conducted an in-depth investigation and remediation of VOCs and odor sources. Regular inspections were Solid Waste Discharge Management
Jiaxing carried out on VOCs emissions from exhaust outlets and "leakage seepage or dropping" and catalytic
Base combustion units and aerobic tank covers were upgraded to ensure high VOC treatment efficiency and odor STL adheres to the principles of "reduction resource utilization and harmlessness" and has established a comprehensive solid
reduction. waste classification management system. The Company strictly controls the entire process of waste generation collection
storage transportation and disposal to ensure that all types of waste are properly handled. STL has set up a solid waste
Equipped all hazardous waste warehouses with secondary activated carbon adsorption units for collecting supervision platform using information technology for real-time monitoring of hazardous waste. In addition regular on-site
Lianyungang and treating non-point source emissions from hazardous waste and installed online monitoring systems at audits are conducted for hazardous waste disposal units to ensure they are qualified and comply with regulations.Base
exit points.STL's full-process solid waste management measures
Measure General solid waste Hazardous waste
Metrics and Targets Domestic waste general packaging materials industrial solid Discarded hazardous chemicals and packagingMain sources waste
STL is focused on continually reducing the intensity of air pollutant emissions. The following air pollutants are monitored and
targeted for reduction: Set up special warehouses to collect solid waste and conduct Set up temporary storage warehouses for hazardous
anti- corrosion and anti-permeation treatment on the waste to ensure that the hazardous waste is collected
Indicators Target Achievement Storage warehouse floor to prevent waste leaks from contaminating soil by type and source according to the requirements of
and groundwater hazardous waste management
Particulate matter 100% compliance rate Achieved monthly tests
concentration meet standards Uniformly arrange special vehicles to transport waste to landfills Contact qualified professional waste disposal entities
Transportation or hand it over to qualified entities for disposal on a regular basis for waste transfer in accordance with relevant national
solid waste transfer regulations
VOCs concentration 100% compliance rate
Achieved monthly tests
meet standards
Recyclable waste is collected and sold for comprehensive Entrusted to qualified disposal units for safe disposal
Disposal use; non-recyclable waste is disposed of by sanitation and centralized recycling
Air pollutant emission Reduce by 13% by departments or qualified units
intensity (including VOCs 2027 with 2024 as In progess
NOX and SO2) the baseline year
6 During the reporting period a new plant was introduced to produce raw materials that the Company previously had to procure externally as a key
initiative for industry chain integration to improve production efficiency and product quality and enhance market competitiveness.
74 75Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Dual Carbon Goals for Green Development
Waste and Recycling STL's solid waste emission overview
STL continues to promote the reduction and resource utilization of solid waste. The Company has developed annual Indicators Unit 2024 2023 2022
management plans for hazardous waste setting clear reduction targets for each year.Hazardous waste generation tonne 125125.82 139198.83 85672.92
Hazardous waste utilization tonne 108998.82 139198.83 /
Hazardous waste utilization rate % 87 100 /
Source reduction Comprehensive Utilization
Non-hazardous waste generation tonne 61105.38 7650.10 8486.05
1 Strict production process control improve the Waste alumina sludge and other general solid waste Non-hazardous waste utilization tonne 61105.38 7650.10 /production qualification rate reduce the amount of 1 to qualified disposal units made of ceramic raw
waste generated by substandard products. materials and construction raw materials. Non-hazardous waste utilization rate % 100 100 /
Total solid waste generation tonne 186231.20 146848.93 94158.97
2 Filter sludge is dried before leaving the warehouse and Waste liquids such as heavy alcohol and styrene tar the waste gas is collected and disposed of in a catalytic 2 are incinerated and the steam generated is used for Solid waste per unit of product tonne/10000 tonne products 0.015 0.015 0.015combustion furnace to reduce the weight of the waste. production and operation.
STL's Solid Waste Reduction and Comprehensive Utilization Measures Soil and Noise Management
Case Optimizing Production Units to Reduce Hazardous Waste Generation Every year STL prepares an annual environmental monitoring program in accordance with the requirements of the Pollutant
Discharge Permit and project environmental assessment and pertinent technical specifications such as the Guidelines on the
* The acrylic acid butyl ester unit at the Pinghu base optimized the reorganization and cracking unit to recycle 0.15 Identification of Potential Soil Pollution Hazards in Key Supervision Entities (for Trial Implementation) and the Technical Guidelines
tonnes per hour of by-products reducing 1200 tonnes of waste liquid annually. of Soil and Groundwater Self-monitoring for Industrial Enterprises. We have also hired qualified third-party environmental
* The Jiaxing base improved the acrylic acid reorganization cracking process raising the recovery rate from 32.5% in testing companies to keep an eye on the soil and groundwater. During the reporting period the Jiaxing base organized soil and
2023 to 47.54% in 2024 reducing the amount of waste liquid by 11549 tonnes. groundwater risk investigation work and completed the Soil and Groundwater Risk Investigation and Remediation Report for STL
and Youlian Chemistry.The main soil and groundwater pollution risks at STL arise from potential chemical and heavy metal leakage during product
production transportation and storage. The Company implements stringent controls to prevent the leakage of pollutants into
Metrics and Targets the soil and groundwater ensuring that contamination does not occur. During the reporting period all STL operational sites
achieved a 100% compliance rate for characteristic pollutants in soil and groundwater.STL has continuously monitored harmful and non-harmful waste generated in the production process and set emission
reduction targets:
Target 2024 Achievement * Hardening and anti-seepage treatment of the ground in the * Strengthening the management of
Source control main production area as well as in key areas such as storage the storage use and transportation of
tanks and hazardous chemical warehouses. hazardous chemicals to prevent spills.
100% compliance rate for solid waste disposal Achieved
* Improve the regular inspection and overhaul system of * Regularly commission qualified
Continued reduction of hazardous waste generation Reduced by over 12000 tonnes Pollution pipelines pools tanks sewage stations etc. and carry out third parties to carry out soil and
monitoring regular checks on the effectiveness of seepage control so as groundwater monitoring.to avoid soil and groundwater pollution caused by sudden
By 2030 the Company aims to reduce the external discharge of solid In 2024 hazardous waste disposal environmental accidents.waste by over 50000 tonnes through self-recycling capabilities at each production base reached
47800 tonnes End control * Timely collection of spilled pollutants and compliant disposal.
Reduce solid waste generation intensity by over 8% by 2027 (with Emergency * Formulate contingency plans for leakage accidents and conduct regular drills to ensure effective control In progress responses and treatment of soil and groundwater contamination in case of emergency.
2024 as the baseline year)
STL's Soil and Groundwater Pollution Prevention and Control Measures
76 77Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Dual Carbon Goals for Green Development
STL also monitors noise impact on both internal and external environments. The Company regularly identifies noise sources
and implements targeted noise control measures. Major noise sources include compressors blowers pumps and construction Ecological Co-building
activities.During the reporting period the Company conducted regular noise monitoring at the plant boundary and its bases
and business units meet the standard limit value of a third-class zone in the Emission Standard for Industrial Enterprises Noise
at Boundary (GB 12348-2008) and the sound environment quality can also meet the requirements of the daytime and night time Water Resources Management
standards of a third class zone of the Environment Quality Standard for Noise (GB 3096-2008) with no impact on the surrounding
environment. In water resource management STL is committed to reducing the impact on local water resources and works closely with communities
The Company continues to implement noise control measures across noise sources transmission paths and receptors. to ensure a stable water supply. The Company enhances water usage efficiency and management by improving its management system
optimizing structures implementing water-saving measures and promoting water resource recycling and reuse.Management System and Structure
Source Recipient STL strictly adheres to the Water Law of the People's Republic of China and other relevant laws and regulations. Based on these
Control Protection legal requirements and standards the Company has formulated internal policies such as the Water Quality Management System
* Adoption of measures such as indoor the Management Regulations for Water Cooler the Management Regulations for Circulating Water and the Water Conservation
acoustic treatment sound insulation of Implementation Guidelines to ensure standardized and regulated water resource management. In terms of management structure
doors and windows and installation of the Company's headquarters under the leadership of the Chairman is responsible for water resource management strategies
* Reasonable layout of high-noise acoustic barriers. * Equip line employees with the and performance and the Strategy and ESG Committee oversees water-related metrics identifies water risks and opportunities
equipment away from noise-sensi- * Use of green belts to absorb and reflect necessary personal protective and drives the formulation of water management strategies and target-setting. Each operational site and business division has
tive areas outside the plant. part of the noise and reduce noise intensity. equipment. established a Water Conservation Management Leadership Team based on actual circumstances with the General Manager directly
* Adopt measures such as vibration reduc- * Regular health checkups for occu- overseeing water resource decision-making approval processes overall water conservation planning and goal setting to ensure
* Optimize equipment selection tion of the machine base and installation pational diseases for employees. the efficient advancement of water-saving initiatives.avoid the use of high-noise equip- of sound-absorbing devices for noisy
ment and reduce the noise level of equipments.equipment operation. Water Risk Assessment and Response
Each STL base and business division adopts diversified water sourcing methods including third-party water supply reclaimed
water reuse and process condensate utilization. The Company has installed water measurement instruments that meet standards
Transmission exceeding national requirements and regularly conducts water risk assessments and water balance tests at all operational
Blocking locations. These measures help analyze water usage conditions detect and repair leaks and improve water efficiency through
STL's Noise Pollution Control Measures equipment upgrades and technological improvements ensuring the efficient conservation and utilization of water resources.STL ensures stable water supply across all bases and business divisions with no water extraction difficulties encountered.The Pinghu base relies on municipal water supply with no
restrictions on total water withdrawal. The Lianyungang
Base has an annual water usage limit of 23 million tonnes
and mitigates unstable water quality issues during high-flow
periods by optimizing circulating water management and
strengthening communication with suppliers. The Jiaxing base
utilizes multiple water sources including river water tap water
and steam condensate ensuring that all water withdrawals
remain within permitted limits.STL actively fosters a water conservation culture by installing
water-saving signage in office areas and organizing employee
training/awareness programs enhancing staff consciousness
and promoting rational water resource utilization. Post Water Conservation Signs
Alternative Water Sources
STL actively promotes the utilization of reclaimed water and rainwater to significantly reduce reliance on fresh water sources. In
2024 the Pinghu base purchased over 2 million tonnes of reclaimed water from municipal sources to replace part of its industrial
water consumption effectively reducing overall water usage. The Lianyungang Base achieved a 70% wastewater reuse rate utilizing
5.145 million tonnes of reclaimed water and 936000 tonnes of additional recycled water for circulating water replenishment
thereby realizing the full-cycle utilization of water resources. The Jiaxing base has implemented a rainwater collection system
capable of harvesting 29600 tonnes of rainwater annually and has carried out modifications to enable reclaimed water reuse in
circulating water discharge recovering 49700 tonnes of water annually.
78 79Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Dual Carbon Goals for Green Development
Water Resource Recycling and Utilization Metrics and Targets
STL continuously advances water recycling initiatives and actively promotes projects aimed at reducing core business water STL has set a target to reduce freshwater use intensity by over 4% by 2027 with 2024 as baseline and implemented a monthly assessment
consumption across all operational bases. In 2024 the Pinghu base recycled 1.1 million tonnes of reclaimed water. The mechanism for unit water consumption across all business divisions. In 2024 overall water efficiency targets across STL's bases were met
Lianyungang Base installed a new reclaimed water reuse system expected to achieve a reuse volume of 4.1 million tonnes per demonstrating effective progress in achieving water conservation goals through scientific management and continuous monitoring.year by 2025. STL Technology transports steam condensate to the main Jiaxing facility saving 60000 tonnes of purified water Lianyungang Base's 2024 total industrial water consumption target was set at 23 million tonnes with actual consumption reaching
annually. The Jiaxing base through its reclaimed water reuse project achieves an annual recovery of 49700 tonnes of water. 20.16 million tonnes. Through increasing the concentration ratio of circulating water reducing wastewater discharge and
optimizing facility water use significant water conservation results were achieved. The Pinghu base successfully controlled water
Water Process Equipment Improve water
recycling upgrade optimization efficiency intensity through product-specific water consumption management.The Company conducts weekly and monthly tracking of water consumption air emissions and wastewater discharges performing
* Enhance the recovery of * Strengthen the pelletiza- * Replace outdated bypass * Use backwash water for pharma- sequential comparative analysis to monitor fluctuations. If significant deviations are detected the relevant department heads are
steam condensate and con- tion process control and filters with energy-saving ceutical dilution to improve the immediately engaged to identify root causes and implement targeted corrective measures ensuring minimized environmental impact.ductive heat flow to achieve reduce the frequency of pel- ones water recycling rate
recycling letizing water replacement We also maintain continuous disclosure of water-related data compiling and publishing three-year historical records of water usage
* Strengthen the inspection * Use phosphorus-free/low phos- and withdrawals demonstrating steadily improving water stewardship capabilities.* Collect rainwater around * Use of surface evaporative of various water supply pipe- phorus water treatment chemi-
the firefighting pool pump air cooler and circulating lines in plants and conduct cals for circulating cooling water
Indicators Unit 2024 2023 2022
it to the water treatment cooling water air for cooling prompt maintenance to treatment technology which can Water consumption
station and then use it for device in the circulating avoid leakage make the circulating water system
replenishing the fire reser- cooling technology reach a 7-time concentration and Total water consumption million tonnes 741.60 566.74 489.20
voir achieve a water-saving rate of Municipal water consumption million tonnes 30.96 33.64 28.52
12.5% Other million tonnes 7.85 6.18 2.16
Water use intensity7 million tonnes/10000 tonne products 0.60 0.50 0.66
Total recycled and reused water million tonnes 702.79 526.92 458.52
Case Market-Driven Approach to Reclaimed Water Reuse Recycled and reused water percentage % 94.76 92.97 93.72
The source water at STL's Pinghu base has consistently high chloride ion content and conductivity severely limiting
industrial water reuse efficiency. In response the base rapidly assembled a professional technical team to explore Biodiversity Conservation
innovative water treatment and circulation processes. It pioneered a fully market-driven and commercialized contract-
based water-saving partnership model between high-water-consumption enterprises and professional water treatment As a leading Company in the petroleum and chemical industry STL pays attention to the impact of its operations on natural resources
companies. A specialized water treatment Company was commissioned to construct and operate two circulating and biodiversity keeps the relevant impact as minimal as possible and actively carries out public welfare activities for biodiversity
cooling water recovery systems. The treated reclaimed water saw significant quality improvements with chloride ion conservation to fulfill its corporate social responsibility. We strictly adhere to national ecological protection related requirements
concentration reduced to 15 mg/L and conductivity lowered to 70-90 μs/m—only one-tenth of the source water values. consider ecological protection during the initial project construction assessment production and operations resolutely reject
The cooling water concentration ratio increased from 2.2 to 4.5. Through close collaboration with water-saving service projects in ecologically vulnerable areas. Additionally the Company continuously improves the monitoring mechanism of ecological
providers STL successfully achieved water conservation cost reduction revenue generation and emissions reduction. protection and restoration protection implements effective measures to mitigate the impact on biodiversity throughout the entire
process of production to conserve biodiversity. As of the end of the reporting period the projects of our production bases and
business units had adhered to the ecological environment control programs the main functional area plan and the general land use
Case Awarded "Water Efficiency Leader" Title in the Ethylene Industry plan and had not crossed the ecological protection red line.The Lianyungang Base has significantly improved water efficiency indicators through technological innovations Case Dust Control at Construction Sites Case Advancing Biodiversity Conservation
including condensate recovery high-concentration circulating water operation and a hierarchical temperature
utilization system for cooling water networks. With a unit water intake of just 2.30 m3/t (47% lower than the industry's At the Jiaxing base STL integrates biodiversity protection In 2024 the Lianyungang Base completed its soil and water
second-ranked enterprise) and outstanding water reuse rates STL was awarded the "Water Efficiency Leader" title in throughout the entire project lifecycle and actively conservation project for the STL Staff Quarters. Through
the ethylene industry earning recognition from the Ministry of Industry and Information Technology as a benchmark implements dust control measures. Continuous scientific planning the base implemented vegetation
enterprise for both energy and water efficiency. walls or fences are installed around the construction restoration and engineering measures optimizing vegetation
site with sealed bases to prevent mud leakage. Dust- distribution increasing green coverage and effectively
generating materials such as cement and sand are reducing the risk of soil erosion to maintain local ecological
Water Balance Testing and Conservation Targets stored in enclosed areas or covered appropriately. stability. Additionally the Lianyungang Base finalized the Exposed surfaces are covered with dust nets or artificial acceptance of its marine ecological monitoring system
STL conducts regular water balance testing to ensure the efficient use of water resources. In 2024 the Pinghu base successfully turf. Additionally a sprinkler system is installed along which enables real-time tracking of seawater quality and
completed water balance testing achieving a 100% functionality rate for water measurement instruments and maintaining a key areas such as main roads and site enclosures with biodiversity indicators. This system provides a scientific basis
leakage rate below 1.68%. The base also significantly optimized unit water intake and successfully passed Zhejiang Province's scheduled mist spraying to minimize dust and maximize and technical support for marine ecological protection with a
water conservation enterprise review demonstrating its excellence in water management. The Jiaxing base completed the preservation of the original land ecosystem balance. total investment of approximately RMB 1.45 million.testing and compiled a report in June 2024 providing critical data for future water conservation strategies. Lianyungang
Petrochemicals completed testing in 2023 while Jiahong New Material plans to conduct water balance testing in 2025 7During the reporting period a new plant was introduced to produce raw materials that the Company previously had to procure externally as a key
progressively expanding coverage to all STL bases. initiative for industry chain integration to improve production efficiency and product quality and enhance market competitiveness.
80 8104 Building a Harmonious Societywith People at the Heart
STL adopts standardized employment practices values employee rights and interests and provides a platform for self-
actualization and professional growth. Actively engaged in public welfare initiatives we foster mutual growth between employees
and the Company contributing to society and working together to realize the "STL Dream".Governance The Company has established a Work Safety Committee chaired by the Chairman of the Board to oversee
all aspects of work safety management underscoring its strong commitment to employee health and safety.Moreover through democratic management systems such as the Employee Representatives' Conference and
labor union the Company ensures employees' rights to information participation expression and supervision
fostering shared progress in corporate development.Strategy Embracing a people-centric strategy the Company acquires and retains talent through inclusive recruitment a well-
established training system and scientifically designed promotion mechanisms supporting employees' all-round
development. Upholding the principles of "safety over profit" and "treating environmental protection as a product"
the Company advances full lifecycle management of chemicals while actively seeking green alternatives to phase
out all high-risk substances of concern. Furthermore the Company integrates public welfare into its development
strategy. This helps enhance our corporate image and brand value contributing to "mutual growth of individuals
and the organization and harmonious progress of the enterprise and society."
Goals 100% labor contract signing Protection of women's rights and increased
rate and social insurance coverage representation of female directors and cadres
Enhanced employee satisfaction Zero work-related injury incidents
100% occupational health 100% identification of 100% rectification
checkup rate major safety hazards of the hazards identified
100% participation in hazardous Regular safety inspections of hazardous
chemicals safety training for relevant chemical storage areas
management and operational personnel
Impacts The Company provides employees with robust professional support and a positive work environment through
risks and well-established employee rights and interests protection mechanisms a diverse benefits system and continuous investment in training. The Company conducts labor and human rights risk assessments every
UN SDGs opportunities six months to identify and address potential risks thereby strengthening employees' sense of belonging and
loyalty and improving productivity and innovation. With a sound safety management system and occupational
health policies the Company employs digital technology to enhance safety management and reduce accident
risks ensuring a safer and healthier workplace for its people. Furthermore the Company proactively engages
in social welfare initiatives supporting rural revitalization educational aid and medical assistance programs to
foster a more harmonious society.Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Building a Harmonious Society with People at the Heart
Safeguarding Employee Rights and Benefits Case Ring the Bell for Gender Equality Supporting the UN Women Initiative
In March 2024 Shen Xiaowei STL Vice
President and Board Secretary and
Yang Xiaoyun Deputy Director of the
Equal Employment Board Office were invited to attend the "Ring the Bell for Gender Equality"
event at the Shenzhen Stock Exchange
which reflects the Company's active
STL acts in strict accordance with the Labor Law of the People's Republic of China the Labor Contract Law of the People's Republic commitment to promoting gender diversity
of China the Social Insurance Law of the People's Republic of China and the Provisions on the Prohibition of Using Child Labor and equal opportunities as part of its
among other applicable laws and regulations. The Company firmly opposes forced labor illegal labor harassment and abuse and corporate social responsibility. This global
strictly prohibits the use of child labor to fully safeguard employees' legitimate rights and interests. initiative jointly launched by UN Women
the World Federation of Exchanges
Anti-Discrimination and Equal Rights and other international organizations aims to advance gender equality and
contribute to the UN SDGs.Committed to fostering equality in the workplace STL ensures STL is actively advancing diversity in nationality and ethnicity
that employees are not subject to discrimination or unfair in its workforce
treatment based on nationality ethnicity religious belief cultural During the reporting period STL employed
background gender age disability or other factors throughout
recruitment onboarding promotion and termination processes.ethnic minority foreign totaling
We encourage individuality at work and advocate a diverse and 195 25 220
employees employees talents
inclusive corporate culture that promotes mutual respect and Diverse Recruitment Channels
understanding among employees. STL employs diverse recruitment channels to build a strategic talent pipeline aligned with its business operations
and development strategies. This allows us to provide talent support for business development establish a long-term
In addition the Company regularly conducts diversity training to enhance employees' In 2024 competitive advantage and create a solid talent reserve pool. In evaluating talent we prioritize ability over credentials
awareness and understanding of diversity and inclusion through systematical education
Labor contract signing rate and contribution over tenure. While academic background and work experience are important we do not see them as and guidance. This helps to further improve employees' sense of inclusivity and respect the sole standard. We focus on a comprehensive evaluation of both character and competence committed to building a
driving the continuous development of our corporate culture. 100% fair just equitable and inclusive recruitment environment.To safeguard the rights and interests of employees we have formulated the Attendance and
Leave Management Measureswhich clearly sets forth work hours national statutory holidays Social insurance coverage rate
paid leave entitlements and overtime compensation. During the reporting period the Company 100%
revised the Attendance and Leave Management Measures to further refine attendance Social Recruitment
regulations specify leave categories and durations and updated approval authorities for
attendance management.Expanding talent acquisition channels
Protection of Female Employees' Establish channels for attracting overseas Strengthening multi-platform
Rights and Interests experts to continuously bring in high- collaborationsSTL actively advances diversity in the Board of
Directors and cadres: level returnees. Participate in offline job fairs and online
In terms of the rights and interests of female employees STL strictly live broadcasts on recruitment platforms.complies with applicable laws and regulations to ensure that female The Board of Directors comprises 9 members Publish recruitment information on more
employees are legally entitled to marriage leave maternity leave and 2 of whom are female directors channels to increase reach and strengthen
special protections during pregnancy childbirth and breastfeeding. Setting up roles for dedicated high-end talent talent acquisition. Launch a WeChat
On top of this we accommodate the special needs of female employees representing 22.2% recruitment officers official account for recruitment and the
by providing nursing rooms for breastfeeding mothers organizing Target mid-to-high-level talent within the industry and "STL Recruitment Mini-Program". Offer
specialized health check-ups for female employees etc. In addition Senior management (Director level and above) advanced management professionals from benchmark referral rewards for internal and external
we are committed to offering female employees with equal career comprises 45 members 11 of whom are companies. Build a strategic talent reserve to meet the recommendations. Mobilize the talent pool
development opportunities. By providing professional guidance on Company's human resource needs during its various and motivate talent acquisition officers to
career development and skills development we contribute to a more women representing 24.4% development phases. recommend candidates.equitable and sustainable future.
84 85Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Building a Harmonious Society with People at the Heart
Campus Recruitment Digital and Intelligent Recruitment Model
STL has been actively advancing the digital and intelligent transformation of its recruitment processes. By integrating advanced
Creating a full lifecycle diversified campus Empowering diverse talent and expanding intelligent talent management platforms we embrace digital technology throughout all stages of recruitment management.recruitment model growth opportunities Leveraging artificial intelligence and big data we have significantly improved talent acquisition and screening efficiency
STL's campus recruitment program spans Each year STL organizes the "Star" training camp for remarkably enhancing operational efficiency.the entire academic year offering various fresh graduates at the undergraduate and master's STL always puts high importance on candidate experience. Through a series of digital initiatives we offer a more convenient
recruitment promotion initiatives such as levels. Through mentorship programs STL selects efficient and high-quality application process for job candidates supporting our strategic talent reserve goals.internships campus ambassador programs and qualified mentors with solid professional knowledge
scholarships tailored to different student groups to guide new employees for one year helping
at various grade levels. them transition into "STL-ized professional and Recruitment System Optimization Launching Video-based Job
international" talents. and Upgrades Descriptions
In talent acquisition we utilize an advanced recruitment STL has introduced video-based job descriptions starting
Establishing a campus ambassador referral system to record data throughout the hiring process and Building the STL IP in Campus Recruitment with campus recruitment. These nicely produced videos go
reward mechanism make timely flexible adjustments to our recruitment beyond the limitations of traditional text-based descriptions
strategies accordingly. This facilitates the development of an by presenting the real workplace giving candidates an
STL launches the "Star Search Program" at target Building STL as a strong IP in campus recruitment is a key internal talent-sharing database driving improvements in immersive preview of their potential roles.universities recruiting campus ambassadors to focus of our talent acquisition efforts. Through workplace recruitment efficiency.break down communication barriers with students. experience videos featuring new employees and social
These ambassadors promote our information media content sharing campus recruitment journeys
within the student community increasing STL's we highlight the benefits of joining STL via campus Expanding External and Internal Combination of Traditional and Digital
visibility on campus. By offering "base salary + recruitment and provide an authentic glimpse into our Referral Channels Interviews
incentives" we encourage campus ambassadors workplace. In addition we invite graduates to participate
to refer candidates and help break through talent in summer camps and open house events offering them Externally STL continues to strengthen collaboration with Embracing digital transformation STL has introduced an
acquisition barriers thereby attracting more high- close exposure to our production environment and multiple hiring platforms and aims to publish recruitment advanced cloud-based recruitment system enabling one-click
potential talents. corporate culture thereby strengthening their sense of information across a wider range of channels to enhance talent notifications for both candidates and interviewers. This eliminates
connection and belonging. acquisition efforts. Internally we have established an employee the red tape and high costs associated with traditional phone calls
referral platform leveraging existing talent networks to achieve and SMS notifications significantly enhancing communication
high recruitment efficiency and retention. efficiency and accuracy. In addition we have initiated live-
streamed recruitment via WeChat Channels and Tencent Meeting
to better attract talents and select candidates.Awards and Honors in 2024
Campus Recruitment Excellence AIGC-Powered Human Resources Top 10 Advanced Talent
Award at the 2024 HR Digital and Pioneer Award at the 2024 HR Digital Management Organizations in
Intelligent Carnival and China and Intelligent Carnival and China Nanhu District Jiaxing City
Human Resources Venus Awards Human Resources Venus Awards
STL Open House for College Students Nationwide
86 87Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Building a Harmonious Society with People at the Heart
Protection of Employee Rights and Interests Democratic Communication
STL practices a people-centric development philosophy and actively promotes democratic management. The Company implements and
STL upholds the fundamental principles of standardization fairness and reasonableness strictly adhering to the salary improves a democratic management system with the Employee Representatives' Conference as its core platform organizing employee
guidelines of "position-based pay" and "equal pay for equal work". We have formulated the Remuneration Management participation in democratic elections consultations decision-making management and supervision.Measures ensuring that our wage standards exceed the local statutory minimum wage providing overtime remuneration and
paying the full amount of social insurance contributions for employees. By doing so we effectively safeguard the legitimate Each year the Company convenes an Employee Representatives' Conference to collectively negotiate and vote on matters such as labor
rights and interests of employees and enhance their sense of security and belonging in the workplace. compensation working hours holiday and leave social insurance employee benefits and labor safety and health. In addition the
Chairman of the Company's Trade Union serves as a member of the Supervisory Board participating in the decision-making process of
Remuneration and Incentives material matters.STL recognizes the contributions and creation of each employee and motivates talent through a well-established remuneration We have established a supervisory mechanism and a dedicated public bulletin board for factory affairs. All matters closely related to
system and incentive measures. The Company has designed a three-level employee incentive structure: short-term (cost- employee interests including performance management compensation system and benefits policies must be reviewed and approved
reduction and efficiency enhancement rewards optimization and improvement rewards premium incentives sales by the Employee Representatives' Conference. Decisions approved by the Board of Directors and the implementation of proposals from the
overachievement rewards) medium-term (restricted stock incentive plans virtual equity) and long-term (shareholding as Employee Representatives' Conference are made public to employees allowing for employee supervision. The Company lawfully protects
business partners). Through targeted value-driven incentive plans we continuously encourage employees to pursue excellence employees' right to know participate express and supervise.and transcend themselves.Labor and Human Rights Risk Assessment
STL places great importance on managing labor and human rights risks. We perform company-wide assessments every six months to
A differentiated remuneration system Remuneration surveys on the market the comprehensively identify and address potential labor and human rights risks ensuring the protection of employee rights and interests.is in place with the remuneration range industry the region and competitors are
determined by position value and the level regularly conducted to ensure that the In the risk identification phase the Company utilizes tools such as safety inspections stakeholder interviews and questionnaire surveys to
determined by personal value. Company's remuneration is competitive examine factors that may affect labor rights and human rights covering aspects such as work environment work intensity remuneration
and in the leading position in the industry. and benefits career development and community relations. Through multidimensional analysis we accurately pinpoint risk areas.STL's In the risk analysis and evaluation phase we comprehensively assess the impact of the risks identified on our business operations
Remuneration employee well-being reputation and compliance. Prioritization is determined and targeted management strategies are developed to
System minimize risk occurrence and prevent human rights violations. The risks identified are addressed through measures such as improving the
Job rank is aligned with remuneration level Remuneration is given as incentives and work environment optimizing workflows and enhancing remuneration and benefits with regular assessments of their effectiveness to
based on position value ability competency guidance. More pay for more work is promote continuous improvement.performance and results. The principles of advocated. No cap is put on remuneration
distribution according to work efficiency incentives. We document the entire labor and human rights risk assessment process in a detailed manner and actively engage with employees
first and fair and sustainable development customers suppliers and communities. Through training and communication we enhance stakeholders' awareness and understanding
are upheld and a sound remuneration of risks to jointly advance human rights protection and labor rights protection.management system is in place.Internal Communication Direct Supervisor or Human
Channels Resources Department
Corporate Culture
Employee Satisfaction Survey STL provides employees with various communication and grievance When employees encounter general issues at work channels to accommodate different feedback scenarios. Furthermore or misunderstandings they can first report them
Safety Department the Company strengthens policy awareness through internal training and to their direct supervisor or the Human Resources
STL conduc t s biannual satisfac tion sur veys Protection Management informational materials ensuring that every employee understands its Center for timely response and support. This
for all employees gathering feedback on key grievance system including the available channels scope of grievances channel is designed to quickly resolve simple
aspects such as corporate culture departmental procedures and division of responsibilities. issues that arise in day-to-day work ensuring
management job fit teamwork personal growth employees receive immediate feedback.logistics support and safety protection. Based on Logistics Job Fit
the survey results we develop plans to improve Support Internal Grievance Mechanisms Complaint Box
employee satisfaction. The Human Resources
Center is responsible for tracking and evaluating The Company has established platforms such as the Employee The Company has set up a dedicated complaint
the implementation progress and effectiveness of Representatives' Conference and the Labor Union through which box for employees to submit their concerns and
the improvement measures and providing regular Personal Growth Teamwork employees can raise grievances and seek solutions. These organizations opinions at any time.updates to the management. hold regular meetings to discuss employee concerns and drive resolutions
2024 Employee Satisfaction Survey Results providing employees with formal and effective channels to be heard.
88 89Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Building a Harmonious Society with People at the Heart
Email Grievance Channel STL Employee Benefits System
The Company has established a dedicated email grievance channel for employees to submit grievance materials via email. The Health Benefits Medical Insurance Benefits Work-Related Benefits
management will respond within a specified time frame after receiving the email. Occupational health check-ups physical Employees are entitled to the "Five In- Free shuttle bus night shift and duty
examination safety allowances health surances and Housing Provident Fund" allowances meal allowances and full
Grievance Handling Process subsidies and high-temperature from the first day of employment. Sup- attendance rewards.allowances for all employees. plementary commercial insurance is
Once the management or designated personnel receive a grievance they will register and review the grievance materials. purchased based on job categories.Depending on the nature and severity of the matters general matters will be handled by the Company's management
while complex matters will be handled under the leadership of the grievance management team. The resolution will be
communicated to the employee promptly. If the employee is dissatisfied with the results they may request further mediation Holiday and Care Benefits Housing Benefits Travel Benefits
or file a complaint with a higher-level department which will conduct a re-examination.Employees enjoy statutory holidays as The Company provides rental subsidies Employees are entitled to paid vacation.well as paid leave benefits (annual leave interest-free home loans and employee
maternity leave marriage leave bereave- apartments to help employees address
ment leave work-related injury leave housing issues.nursing leave sick leave breastfeeding
Satisfied Not leave Women's Day leave etc.) holiday
or Not Satisfied subsidies various special benefits and
condolence money and birthday gifts.Graded Feedback: Review: Higher-
Reception
Processing Notify Result Level Review Home Visit Subsidy Tuition Subsidy Children's Education Support
Employees with at least one year of service Employees with at least one year of The Company cares about the education
are eligible for a home visit subsidy. service are eligible for subsidies for of employees' children and provides
pursuing a higher degree or professional scholarships and student grants to create
development training. a more harmonious workplace and com-
munity while witnessing and supporting
Grievance Handling Process the growth of the younger generation.For employees whose families are facing difficulties the Company has always been a strong source of support. We promptly reach
out to understand the situation and provide emotional support and financial assistance. As a bridge between employees and
Anonymous Protection Regular Evaluation and Improvement society we not only care for our employees but also extend this support to their families offering condolence money to employees'
parents and tuition subsidies for their children.During the grievance handling process the Company will The Company regularly evaluates the implementation of the
take necessary confidentiality measures to protect the grievance system promptly addressing any issues identified In 2024 STL provided medical subsidies to a large number of employees' family members. Meanwhile STL provided nearly 3000
privacy of employees and the trade secrets of Company from and continuously optimizing the system to ensure that dormitory units accommodating 3581 employees.leakage. employee rights and benefits are properly protected.Employee Activities
Caring for Employees STL places great importance on human-centered care and the development of an employee culture. We have established well-
equipped facilities such as a staff service center library gym and
tennis courts offering a wide range of cultural and recreational
Employee Benefits System opportunities for employees. These include sports competitions like
STL always prioritizes the needs of employees placing great emphasis on the mental and physical well-being of employees. basketball and badminton health lectures and seminars book clubs
The Company has established policies such as the Benefits Management Measures and the Employee Home Visit Subsidy cultural festivals Mid-Autumn song parties and birthday celebrations.Management Measures aiming to create a comprehensive and thoughtful employee benefits system. In addition we regularly organize annual team trips and Family Day
events inviting employees' families to participate and fostering stronger
In 2024 STL revised the Benefits Management Measures which now include 64 "happiness policies" across 5 major categories emotional connections between employees and their families. STL
and 12 sub-categories. The revised version improves the standards for sick leave pay increases meal allowances and overtime also encourages employees to engage in community service and public
compensation and expands the coverage of the home visit subsidy benefiting all employees across the Company. welfare activities strengthening their sense of social responsibility. STL Family Day Event
90 91Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Building a Harmonious Society with People at the Heart
Growing Together with Employees
Professional Skills Training
Employee Training STL has formulated the Rules for the Implementation of Special Training Programs of STL Group. During the reporting period we
organized a series of professional capability enhancement training sessions for engineers and key financial personnel focusing on the
Upholding the culture of "Harmony" STL has established a comprehensive training "two leading" strategy. By engaging external professional trainers and combining course material with workshop discussions we provided In 2024
policy framework which includes existing systems and rules such as the Training comprehensive training for 300 engineers and 36 finance staff. This helped establish our methodology for corporate management and
Management Measures the Internal Trainer Management Measures the Teaching Material the Company increased its talent development and consolidate our internal talent cultivation experience.Development Guidelines the Mentor Management Measures the STL Group Star Cultivation investment in training with
Empowerment Manual the STL Group Star Cultivation Manual the STL Group "Star" a total expenditure of RMB
Training Camp – Political Commissar's Work Manual and the SOP for Training Project 4.22 million
Implementation. Through unified planning the Company ensures standardized training
efforts providing employees with high-quality training services.Building an Online Building a Training Tuition Reimbursement
Learning Platform Faculty System Mechanism for Degree
Leveraging the STL Business School STL places great emphasis on developing a Advancement
online learning platform the Company training faculty system injecting momen- STL has established a comprehensive
strives to create a comprehensive and tum into employee growth and corporate tuition reimbursement mechanism for
efficient training system closely aligned development by building a diverse team of degree and professional qualification ad-
with its strategic goals and employee trainers. vancements. Employees can apply for re-
development needs. In 2024 we success- imbursement according to the Company's
fully developed 59 internal video courses STL selects internal trainers from outstand- regulations after they graduate and obtain
covering a new employee series (18 cours- ing employees technical experts and man- relevant qualifications or certificates with
es) policy series (5 courses) marketing agers and provides systematic training in a reimbursement cap of RMB 400000. In
series (33 courses) and general series (3 teaching methods course design and more 2024 over 400 employees participated in
courses). A total of 19645 person-times of to enhance their teaching skills. In addition the degree advancement program with
online learning were completed. the Company actively collaborates with a total reimbursement amount reaching
industry experts scholars and professional RMB 1.047 million.training institutions to invite external ex-
perts to share cutting-edge knowledge and
the latest technological trends while also
introducing customized training courses.Diverse Training System for Talents Professional Capability Enhancement Training for Engineers
New Employee Onboarding
STL has formulated the Rules for the Implementation
of Training for Fresh Graduates and the Rules for the
Implementation of Training for New Employees Hired
through External Recruitment. For new hires especially
fresh graduates we have designed a systematic
onboarding program. Through initiatives such as the "Star
Training Camp" new hires are organized to participate
in onboarding camps where they engage in intensive
lectures team-building activities case studies role-
playing and other methods to systematically learn about
our corporate culture job skills and professional qualities.This training helps new graduates transition from
students to working professionals and ultimately become
"independent KPI owners" or "skilled performers".New Employee Onboarding Training Training for Financial Key Personnel
92 93Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Building a Harmonious Society with People at the Heart
Leadership Development Program Employee Development
STL has implemented differentiated leadership development
programs for management at all levels to comprehensively Employee Promotion and Development Channels
enhance their leadership skills and meet the development STL has established science-based promotion pathways and management mechanisms. Policies such as the Management
needs of the Company. Measures for Talent Development Review Management Measures for Employee Job Level Evaluation and Cadre Management
Senior managers visit benchmark companies to learn Measures have been formulated to ensure open and transparent promotion standards. STL provides employees with a broad
advanced management practices within the industry. Middle career development platform and builds an efficient talent pipeline.managers enhance their leadership skills through a reading STL has established three career advancement tracks: Management Professional and Technical. The Company prioritizes
club on The 21 Irrefutable Laws of Leadership.Frontline ability over credentials and contribution over tenure. With a fair and transparent competitive internal selection and transfer
managers undergo specialized empowerment training to system we encourage employees to specialize in their strengths and aim to support diverse talent development needs.improve their job performance.Diverse career advancement tracks
Leadership Training for Senior Managers
Management
Track Supervisor Manager Director Executive
Professional
Track Staff Junior Intermediate Senior Expert Chief Expert
Chief
Scientist
Technical Junior Intermediate Senior Senior
Track Worker Worker Worker Technician Technician
Employee Assessment and Feedback
STL conducts annual assessments of employees based on the Cadre Management Measures and the Management Measures for
Employee Job Level Evaluation. In addition to build a science-based efficient talent development system that allows accurate
identification of candidates for leadership roles the Company regularly conducts Talent Development Reviews (TDR).The Talent Development Review (TDR) evaluates talents using two dimensions i.e. competency and potential and positions
individuals in a nine-box matrix. The horizontal axis represents competence based on the performance standards of the
current position. It is assessed through qualification evaluations and other methods with three levels: Higher than Expectations
(H) Meeting Expectations (M) and Lower than Expectations (L). The vertical axis represents potential and focuses on future
growth. It is assessed according to general cadre standards including interviews and surveys and categorized into three levels:
Very High Potential (VH) High Potential (H) and Steady (S).Lower than Expectations (L) Meeting Expectations (M) Higher than Expectations (H)
Benchmarking Visits for Senior Managers Very High Potential (VH) Developing (10%) Future Star (10%) Star Talent (10%)
High Potential (H) To Be Observed (10%) Core Employee (25%) Expert for the Job (10%)
In 2024
STL organized training for a total of Steady (S) Low-Performing Employee (5%) Qualified Employee (10%) High-Performing Employee (10%)
General Professional Skills Training 5057 accumulating 436544
person-times hours of training Excellent employee on both fronts Core talent priority Competency or Not
STL's training system also covers general professional priority for employee development for employee potential needs to competent
skills development such as marketing courses with additional incentives and development included be improved personnel which amounts to an average of hours of
and communication skills to enhance employees' training per employee. 86 resources included in the cadre in the cadre pipeline adjustment
competitiveness and adaptability in the workplace. pipeline required
94 95Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Building a Harmonious Society with People at the Heart
Robust Safety Practices HSE Management Revolutionized with Digital Technology
Aligned with digital transformation trends STL has independently developed a Supported by "Five-in-One" platform
"Five-in-One" platform to elevate safety risk identification early warning and
control to new levels of intelligence precision and efficiency. With this platform Risk identification accuracy rate up to
Work Safety Management STL has achieved a milestone with second-class safety response time with a risk identification accuracy rate of up to 85% and a reduction in safety incident 85%
hazards by up to 80%.STL always places the health and safety of its employees as a top priority and upholds the corporate Reduction rate in safety incident
The "Five-in-One" platform supported by over 20000 bluetooth beacons hazards up tomission of "Chemicals Make A Better Life". STL strictly complies with national laws and standards
including the Work Safety Law of the People's Republic of China and the Occupational Disease Prevention creates a positioning system with an accuracy of 3 meters and a frequency of 2 80%
and Control Law of the People's Republic of China and has developed and continuously improved seconds enabling 24/7 online safety risk monitoring and real-time early warning.its internal policies and systems for occupational health and safety. The Company ensures the strict The platform deeply integrates "People Machine Object Environment and
implementation of its primary work safety responsibilities screens and identifies various potential safety Management" creating a one-stop integrated management ecosystem which
hazards and comprehensively improves its work safety management standards. encompasses smart comprehensive management visualized operation and
maintenance intelligent business collaboration instant alarm handling and
coordinated escalation and significantly enhances the effectiveness of chemical
Safety Management System work safety management.To further strengthen its management of work safety and environmental In 2024
protection and to enhance employees' awareness and actions
regarding safety and environmental protection STL has established The Company did not have
the Management and Evaluation System for Employee Safety and any work safety incidents.Environmental Protection Rewards and the HSE Performance Evaluation
and Management System. By developing assessment and incentive
systems the Company comprehensively evaluates employees' safety
behaviors in a systematic and standardized manner. Based on the
results of these evaluations corresponding rewards and penalties are
implemented to encourage all employees to actively participate in work
safety and environmental protection practices.Safety Management Structure
To ensure the smooth implementation of the Group's work safety efforts STL has established a Work Safety Committee
chaired by the Chairman of the Board of Directors. The Committee comprises 4 vice chairpersons 1 office director 11
members 15 dedicated safety management personnel and 7 registered safety engineers. Members of the Committee
are drawn from the heads of various departments covering all key areas related to work safety. The Committee has a
general office responsible for daily safety management and for carrying out tasks assigned by the Committee. The office
is led by an executive member of the Committee who serves as the office director.The Work Safety Committee oversees the Group's overall work safety efforts and develops both short-term and long-
term plans. It actively implements work safety policies laws and regulations assesses key projects and reviews and "Five-in-One" System
approves management measures. The Committee holds monthly meetings to monitor the implementation of work
safety measures across departments address major work safety issues propose improvements coordinate cross- To safeguard the health of employees the Company has introduced a digital occupational health sampling management
departmental efforts review emergency response plans and manage critical safety and occupational health matters platform for dynamic management of occupational health (filing examination and medical checkups) occupational health
to ensure the orderly progress of work safety within the Group. The general office handles the Committee's daily management records training for responsible personnel deployment of personal protective equipment (PPE) and on-site
operations including monitoring the status of various units collecting and analyzing potential hazards and suggestions placement of warning signs. This systems enables more efficient and timely identification of potential health risks and the
implementing a dual-prevention mechanism organizing safety inspections overseeing the execution of emergency implementation of corresponding preventive measures.drills preparing meetings and following up on meeting minutes. It ensures the efficient functioning of the Committee
helping to eliminate potential hazards and maintain a safe working environment for the Group.
96 97Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Building a Harmonious Society with People at the Heart
Occupational Health Management Occupational Disease Prevention
STL follows its internal occupational health and safety policies to actively implement comprehensive and
effective management measures which include but are not limited to:
Work-Related Injuries Management Identifying monitoring and assessing occupational hazards in In 2024
production operations. Employee occupation health
To standardize the handling procedures for work-related injuries and enhance employee awareness of work safety STL has check-up rateEach production base and business division has identified their occupational
established a comprehensive work-related injury management system which clearly defines the processes for preventing hazards in production processes such as noise high temperatures dust welding
handling and following up on work-related injuries thus helping to minimize risks for both the Company and its employees. 100%fumes and chemicals. The Company conducts regular occupational hazard
monitoring to ensure a working environment that satisfies safety standards No cases of occupational
laying a solid foundation for employee health. Employees in positions exposed diseases detected
to occupational hazards undergo annual occupational health check-ups. In 2024
Daily Protective Measures 100% of these employees received occupational health check-ups with no cases
of occupational diseases detected.Personal Protective Equipment Workplace Improvements
Giving priority to adopting new technologies that benefit the prevention
of occupational diseases and protection of workers' health.Employees are provided with appropriate PPE such as STL continuously improves workplace conditions to reduce
earplugs safety glasses and gloves based on their exposure or eliminate occupational health hazards. Through measures The Company ensures the proper functioning of occupational disease prevention and emergency response facilities and
to workplace hazards. Regular training sessions and such as optimizing ventilation systems reducing noise levels equipment. STL employs automated mechanized and enclosed systems for material transport installs insulation layers on
inspections are conducted to ensure proper usage. improving lighting and installing warning signs and warning equipment pipelines in high-temperature areas deploys exhaust gas absorption systems in dust-prone areas and implements
lines STL reminds employees to stay alert about safety. noise control measures such as factory soundproofing and soundproof shades. For SAP respirable dust STL conducts regular
sampling and sends the samples to the BV laboratory in the U.S. for analysis ensuring comprehensive employee health protection.Post-Injury Management
During the reporting period
Providing occupational disease prevention training
Immediate Medical Attention
Safeguarding the health of employees is STL's top priority. In the event of a safety incident 100% of STL's operational Each production base and business division conducts training on occupational
STL arranges medical treatment for the injured employee as soon as possible. locations received the ISO disease prevention and the proper use and management of PPE for employees. 45001 Occupational Health and
Safety Management System
Strict Compliance with National Regulations on Work-Related Injuries certification.STL ensures timely reporting of work-related injuries and provides
remuneration including work injury wages and one-time disability subsidies
as mandated by law.Medical Treatment Period Management
STL effectively manages relevant matters during employees' medical
treatment period arranging caregivers as needed to ensure proper care
and support.Accident Investigation and Analysis
Investigations and analyses are conducted to accurately understand
the incidents identify causes and patterns and draw lessons. Effective ISO 45001 Occupational Health
Training on occupational disease prevention and proper use and
preventive measures are then implemented to prevent recurrence and and Safety Management System
management of PPE at Weixing New Materials
ensure work safety. Certification
98 99Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Building a Harmonious Society with People at the Heart
Safety Hazard Prevention Chemicals Management
STL has formulated its Environmental and Occupational Health and Safety Monitoring In 2024 Governance
Measurement and Control Procedures. Drawing on "Five-in-One" intelligent
management platform that monitors safety risks in real-time the Company accurately All identified safety issues In strict compliance with applicable laws and regulations including the Work Safety Law of the People's Republic of China the Fire
identifies sources of major hazards enables early warnings and efficiently detects were rectified on time. Protection Law of the People's Republic of China and the Regulations on the Safety Management of Hazardous ChemicalsSTL
and rectifies safety hazards to prevent risks and ensure work safety. In addition the has established a chemicals safety management system from the headquarters to front-line operations. The Work Safety and
Company conducts a comprehensive internal safety audit annually to ensure the Environmental Protection Center is responsible for formulating strategies policies and standards for chemicals management
effective implementation of safety management measures. In 2024 all identified safety ensuring that the Company's chemicals-related activities comply with both domestic and international regulatory requirements.issues were rectified on time. The Center also oversees the implementation of the above strategies policies and standards at each production base and business
division. Production bases and business divisions are responsible for the usage storage transportation and disposal of chemicals
and for developing emergency response plans for unexpected events.Handling and Management of Safety Incidents
Strategy
STL has formulated detailed emergency response plans for safety incidents to ensure that in the event of an incident on-site personnel
can quickly respond report the incident according to established procedures and immediately activate the contingency plan. STL follows the principle of "strategic leadership and overall control" by headquarters and requires each production base
to perform "front-line execution for ensuring safety". The Company has established a transparent and efficient supervision
Senior managers of the Company play a crucial role in handling safety incidents. The general managers of each production base procedure an information reporting mechanism as well as incentive and assessment systems.and business division are responsible for leading the on-site handling of major or more serious safety incidents as well as significant
process safety incidents. Vice general managers participate in the on-site command and guidance of general or more serious safety
incidents. Managers of each process unit are responsible for the on-site handling of smaller incidents and general process safety Restricted Substances Management
incidents. After an incident the management must promptly arrive at the scene to direct rescue efforts ensuring the incident is STL strictly complies with domestic laws and regulations such as the Work Safety Law of the People's Republic of China
effectively and promptly controlled. the Hazardous Chemicals Management Regulations the Regulation on the Administration of Precursor Chemicals and the
Measures for the Public Security Management of Explosives Precursorsas well as international regulations such as the REACH
Furthermore the Company has established close ties with nearby medical institutions to ensure that injured employees receive Regulation POPs Regulation CLP Regulation California Proposition 65 Annex III Chemicals of the Rotterdam Convention the
fast professional medical treatment. EPA's list of hazardous substances the SVHC List ZDHC MRSL 20_V3.1 among other laws regulations industry standards
international conventions and customer requirements. Based on the applicable regulations and requirements STL has
Emergency Safety Drills identified and assessed all chemicals involved in its materials and production processes.STL conducts multiple emergency drills each year covering all employees across all production departments. These drills The Company has established a general survey system for chemicals conducting regular surveys on the usage production
encompass a wide range of scenarios including emergency evacuation for explosion incidents rescue procedures for falls from storage and other aspects of all substances identified in the List of Restricted and Banned Substances. This ensures strict
height on-site containment of material leaks first aid for burns and poisoning emergency shutdowns for mechanical injuries full-lifecycle management of chemicals procurement transportation storage usage and disposal. In addition we maintain a
and natural disaster prevention and response. These activities not only assess the feasibility and practicality of emergency transparent mechanism for publicly disclosing the registration and usage of chemicals involved in our operations. We provide
response plans but also enhance employees' awareness and ability to handle various emergencies. information on these chemicals including Safety Data Sheets (SDS) and labels to stakeholders such as end users ensuring
compliance with external regulatory requirements
Work Safety Training None of STL's products (including existing products and those in the pipeline) use any banned substances in the List of
Restricted and Banned Substances.STL provides workplace safety training covering topics such as occupational disease prevention proper use of PPE and safety
measures for summer including fire prevention heatstroke prevention lightning protection and flood control. Specialized
training is offered to employees in high-risk positions while new employees undergo safety orientation to ensure that they fully
understand the Company's safety policies regulations and operational procedures before starting work.Contractor HSE Management
The Company has formulated the Detailed Rules for Contractor HSE Management and the Supplier/Contractor Code of Conductwhich
set standardized requirements and management procedures for contractor entry selection utilization project preparation on-site
management and appraisal. Contractors must comply with occupational health and safety regulations ensure that workplace facilities
meet safety environmental and health standards protect employees and surrounding residents from hazards caused by production
and products and strive to achieve the HSE management goals of "zero injuries zero incidents and zero pollution".The Company has developed relevant qualification verification forms and performance appraisal forms to implement a reward and punishment-
based management system for contractors. Through dynamic appraisals and comprehensive evaluations contractors with
outstanding performance are rewarded while those who violate regulations are penalized or even blacklisted.
100 101Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Building a Harmonious Society with People at the Heart
Full Lifecycle Chemicals Safety Management Chemicals Phase-out and Impact and Risk Management
STL strictly adheres to the requirements of the Hazardous Chemicals Management Regulations implementing full lifecycle Replacement
management of chemicals from procurement transportation and storage to usage and disposal and strictly performing STL prioritizes control at the source in chemicals management STL develops and implements an annual chemicals safety risk
filings registrations and review and approval processes. implementing chemicals phase-out and replacement processes assessment plan each year. This plan covers a comprehensive
from a forward-looking perspective. The Company has developed identification and oversight of all chemicals used throughout
Phase Measures its chemicals phase-out list in accordance with national and local the Company's entire value chain including raw materials
compliance requirements such as the Catalog of Backward Work auxiliaries reagents and products. By conducting general
* Ensure that products in the pipeline do not contain banned * Conduct safety assessments of chemicals Safety Production Processes Technologies and Equipment of surveys of chemicals we establish detailed chemical registration
substances and consider green chemistry principles. including potential environmental and health risks. Hazardous Chemicals to Be Phased Out (First Batch) and the forms based on the properties and categories of chemicals and
Research and Catalog of Toxic Chemicals Prohibited or Strictly Restricted in engage third-parties to conduct full-factory chemical safety risk
Development * Identify hazards in pipeline products specifying their * Assess potential exposure routes and intensity Chinaand by incorporating in-house hazard assessments. assessments.toxicity corrosiveness flammability and environmental during experiments and establish corresponding
and health impact. control measures. In addition we are actively working on chemicals replacement All chemicals are registered in the Hazardous Chemicals
processes considering or seeking safe chemical alternatives with Registration Comprehensive Service System the Precursor
* Complete hazardous chemicals plans to phase out all chemicals of concern in the future. We are Chemicals Management Service Platform the Hazardous Procurement * Evaluate suppliers to ensure the chemicals are safe. registration to ensure traceability. exploring the adoption of biologics or green raw materials and are Explosives Precursors Information System and the STL Chemicals
compiling a Positive List of Chemicals following the U.S. EPA's Safer Registration Forms. This ensures full coverage transparency and
Chemical Ingredient List while promoting its integration into our
Warehousing standardized management fortifying the Company's ability to * Implement appropriate safety facilities based on the type * Install video surveillance systems emergency
properties and quantity of hazardous chemicals. shut-off mechanisms and combustible/toxic gas business processes. control chemical safety risks.alarm systems.* Store chemicals by properties/category to prevent contact
between incompatible substances. Metrics and Targets
STL regularly assesses the chemicals management performance and goal achievement of each production base and business
Production * Achieve a high level of automation in production * Apply stabilizers or refrigerated water-based division linking the assessment results to employee performance appraisals and reward and punishment. We encourage active
processes. cooling to chemicals prone to polymerization or employee participation in chemicals management to collectively enhance our chemicals safety management standards.requiring temperature control.In 2024 the Company made significant progress in chemicals safety management
Loading *Conduct "Five Mandatory Inspections" on incoming * Enforce strict use of PPE equip fire safety
and cargo vehicles to ensure compliance with procedures and equipment and prohibit smoking and fires.Unloading qualifications requirements.
8 major product catego- 7 product lines passed haz- The List of Restricted Over 12 major hazard
* Employ digital technologies to enhance safety ries completed the ZDHC ard factor testing and cer- and Banned Substances source assessments for
* Define designated routes and speed limits for vehicles management. certification ensuring tification including VOCs was established and hazardous chemicals
entering factories. the environmental and and heavy metals from updated in a timely man- were conducted.health safety of products. external organizations such ner with 125 restricted
Usage * Strengthen safety training to improve overall safety * Enhance emergency response drills to improve as SGS further verifying and banned substances
awareness and operational proficiency. incident handling capabilities. product safety. clearly specified.Sales * Disclose the registration and usage of all chemicals * Ensure that chemicals used in products comply Objective Progress in 2024
involved in operations through a transparent mechanism. with the safety requirements of customers and
the market.* Provide Safety Data Sheets (SDS) and labels to meet 100% of management and operational personnel involved with hazardous Achieved
external regulatory requirements. chemicals to participate in hazardous chemicals safety training
Regular safety inspections of hazardous chemical storage areas (daily checks by
Disposal * Store waste chemicals in accordance with the Pollution * Engage qualified providers to collect transport workshop managers and weekly checks by the hazardous chemicals management Achieved
Control Standards for Hazardous Waste Storage. and treat waste chemicals. department)
* Fill in the triplicate form for waste chemicals transfer on * Dispose of waste chemicals in compliance with
the government's hazardous waste management platform. regulations to prevent environmental pollution.The toxicity flammability and explosive properties of toluene increase safety hazards in the production process and this substance
has been included in the SVHCs (Substances of Very High Concern) list and the EPA's (Environmental Protection Agency) list of
We have not only implemented strict measures at each stage of the chemical lifecycle but also formulated the Guidelines for Safety hazardous substances. The company continues to promote the toxic chemicals phase-out program replacing precursor chemicals
Risk Assessment of Aging Equipment in Enterprises Producing or Using Hazardous Chemicals. Regular safety risk assessments with new green chemicals in the acrylic production process which effectively reduces the safety risks in the production process
are conducted on existing equipment with corresponding risk control measures established. For precursor chemicals explosives and significantly reduces the negative impact on the environment.precursors and highly toxic chemicals we require relevant personnel to obtain a Precursor Chemicals Administrator Certificate to
ensure professional handling.
102 103Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Building a Harmonious Society with People at the Heart
Fulfilling Corporate Social Responsibility In addition the Company organized six volunteer litter-picking activities and visits to
nursing homes supporting environmental
STL remains committed to social responsibility actively engaging In 2024 protection and social welfare with concrete
in diverse public welfare initiatives with focuses on assistance efforts. During the environmental activities
for individuals in need educational support rural revitalization STL organized 53 volunteering activities our volunteers visited communities and
medical assistance environmental protection civilized society parks helping maintain a clean and beautiful
building and disaster relief. The Company has established a benefiting over 10000 individuals with total environment. These efforts not only
namesake charitable foundation and launched the "Mother donations both monetary and in kind raised public awareness of environmental
Yang Charity Initiative" as its philanthropic brand. Through the protection but also contributed to improving
"Charity+" model the Company continues to give back to society. amounting to RMB 42.24 million the local community environment. During
the nursing home visits our volunteers
Rural Revitalization played games with the elderly helped cut
their hair and clean their living spaces and
improved their overall living conditions.In 2024 in active response to the national rural revitalization strategy STL took concrete steps to support rural development. The These activities brought joy and warmth
Company signed a donation agreement with the Nanhu District Charity Federation of Jiaxing and the Jiaxing Agricultural Technology to the elderly and contributed to building a
Promotion Foundation donating RMB 200000 in May 2024 to support agricultural technology promotion programs. This initiative more harmonious society.helps to enhance agricultural efficiency increase income for low-income rural populations directly benefiting 451 farmers directly
benefiting an area of 1382 acres and contribute to the development of "new countryside".STL also organized a visit for party members to Sanxing Village to study cases of the "Common Prosperity 101" initiative. During Educational Support
the visit the party members purchased goods from local orchards and souvenir shops opening new market channels for local
agricultural products. By leveraging consumption-driven support STL actively promoted high-quality agricultural and subsidiary In terms of educational support STL actively fulfills its corporate social responsibility by continuously contributing to
products making a tangible contribution to local economic growth. educational development. Through various initiatives the Company supports different student groups promoting educational
Furthermore STL has established "Common Prosperity Workshops" and "Common Prosperity Workspaces" to provide employment equity and progress.opportunities for rural communities. These initiatives specifically recruit 978 surplus laborers from surrounding rural areas helping
poverty-stricken individuals from Yunnan Guizhou Sichuan Gansu and Ningxia rise above hardships.Paired-up assistance to help students achieve their dreams
Case Building "Common Prosperity Workshops"
STL has deepened its paired-up assistance and joint development model with Jiaxing University Jiaxing Xiuzhou High School
STL proactively responds to the call for common prosperity by establishing "Common Prosperity Workshops" and "Common among other schools and institutions. From providing financial assistance to students in need to establishing teaching awards
Prosperity Workspaces" within the Company. These initiatives specifically recruit employees from underdeveloped regions and creating charity libraries STL fully supports students' growth offering solid support to help them complete their studies
providing extensive job opportunities to individuals from poverty-stricken households in areas such as Yunnan Guizhou Sichuan and realize their dreams.Gansu and Ningxia. This approach not only helps impoverished people increase their income but also comprehensively enhances
their skills and abilities through training and career development support. By the end of the reporting period the average In October 2024 the STL Charity Foundation held a scholarship award ceremony at the Mother Yang Charity Library at Jiaxing
monthly wage of "Common Prosperity Workshop" participants increased from RMB 7000 to RMB 9000 a year-on-year growth Xiuzhou High School encouraging students to pursue their dreams. A total of 10 students received scholarships including 4
of approximately 28.6%. This initiative creates a win-win situation by increasing income for rural residents improving efficiency students from Xinjiang.for the Company and fostering common prosperity. It highlights STL's active role in promoting social equity and coordinated
economic development.Volunteering Activities
In 2024 STL took on environmental missions by actively participating in volunteering activities for environmental protection. In specific
the Party and Labor Union Office played a leading and exemplary role in organizing various volunteering activities.On the National Tree Planting Day STL partnered with the Nanhu District Agricultural and Rural Water Affairs Bureau Nanhu District Urban Law
Enforcement Bureau CPC Committee and Youth League Committee to jointly host the "Greening Our Communities Protecting the Environment"
event. Participants worked together to plant trees contributing to a greener landscape and promoting ecological development.In addition STL held its 2024 Walking Challenge at the Jiaxing Botanical Garden with over 200 employees participating. This event not
only promoted physical well-being but also embodied the principles of green and low-carbon development.
104 105Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Building a Harmonious Society with People at the Heart
"The Way to Fish" Education Program Medical Assistance
"Give a man a fish and he eats for a day; teach him to fish and he eats for a lifetime" guided by this philosophy STL has built a "1+4" system
focused on "assistance for disadvantaged students donations of school facilities incentives for outstanding students and rewards for key As a company committed to social responsibility STL has always been dedicated to healthcare development. In 2024 the Company
teachers" aimed at bridging educational gaps between Western China and the rest of the country. donated advanced medical equipment worth RMB 2 million to the First Hospital of Jiaxing through the Jiaxing Charity Federation.This donation aimed to enhance the quality of medical services allowing more patients to benefit from high-quality diagnostics
In June 2024 Yang Yuying Party Secretary of STL led a team to visit Maixi Township School in Ruo'ergai Sichuan and and treatment made possible by advanced equipment thereby offering STL's contribution to the healthcare sector.personally delivered charitable supplies including blankets and down jackets to the children and encouraged them to pursue
their dreams. This charitable initiative was praised and reported by platforms such as Xuexi Qiangguo and Zhejiang Workers'
Daily. In December the Company donated direct drinking water machines computers and other supplies to the Shaya Social
Welfare Institute in Xinjiang through the Jiaxing Command Center for Assistance to Xinjiang improving the learning conditions Assistance for Individuals in Need
for students and the office environment for teachers. In 2024 the Company has established paired partnerships with over 1500
students in Western China. STL extends its care from within the Company to the wider community maintaining a steadfast focus on vulnerable groups.In December 2024 the Company In addition STL actively reaches out to individuals with disabilities elderly people who have lost their only child families facing financial
jo in e d fo rce s w it h Shay a S o cial hardships and those impoverished by illness offering not only material assistance but more importantly emotional support and comfort.Welfare Institute in Xinjiang to hold The Company regularly expands the scope of its charitable outreach deepens its engagement at the grassroots level and extends its reach
a charitable donation event. The so that more people in need can experience warmth and support.event was attended by Yang Yuying
Party Secretary and Vice Chairman
of STL Chen Bin Deputy Director Civilized Society Building
of the Jiaxing Command Center for
Assistance to Xinjiang leaders from
the Shaya County Civil Affairs Bureau STL actively fulfills its social responsibilities. The Company has established a Party Member Volunteer Service Team and the "Mother
and Yang Yazhen Chairman of the Yang Charity Initiative" to carry out various volunteering activities that promote a civilized society. From library services and advocating
STL Public Welfare Foundation. The pedestrian-friendly crossings to environmental initiatives and community convenience services STL contributes comprehensively to
leaders gave away computers books and other educational and sports supplies to 70 children at the welfare institute with a building a civilized society.total value exceeding RMB 55000.Under the "Mother Yang Charity Initiative" STL has set up care stations across 19 villages and communities in Nanhu District working in
Caring for Special Needs Students collaboration with local authorities to ensure full coverage. The stations provide free cold drinks in summer and hot ones in winter for
STL places a high emphasis on students with special needs. The Company has established "STL Classes" in collaboration with sanitation workers couriers delivery riders and other groups along with regular material assistance to disadvantaged individuals in need.schools to provide specialized education for children with autism. We also care for the parents of autistic children by inviting On June 26 2024 the "Mother Yang Charity Initiative" joined multiple government departments in Nanhu District for a charitable donation
professional teachers to offer guidance and support. Additionally we donated psychological counseling equipment and in Ruo'ergai Sichuan which marks the fifth consecutive year of the initiative's paired partnership with local schools. This time donations
supplies to the Nanhu District Counseling Center for Minors helping to create a positive environment for special needs students included 336 down jackets over 300 sets of school supplies and 248 sets of dormitory bedding. Following the donation ceremony at Maixi
and demonstrating our commitment to humanitarian care. Township Central School Mother Yang encouraged the children to pursue their dreams and spread kindness. She also visited families of
students with special needs offering warmth and support.
106 107Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Appendices
Appendices Honors in 2024
Award/Honor Level Granted By
Outlook Industry Leadership
Shenzhen Stock Exchange (SZSE) and Shenzhen
Inclusion in the Shenzhen 100 Index Index
Those who act consistently succeed; those who advance persistently arrive. 2025 marks the final year of the 14th Securities Information Co. Ltd.Five-Year Plan and a pivotal year for outlining the 15th Five-Year Plan. In the face of new circumstances and tasks Top 100 Value Companies Listed on the Main Board List/ Securities Times
STL remains at the forefront of the transformation in the chemical industry toward high-end intelligent and Rankings
green development. We will work to cultivate "new quality productive forces" through technological innovation List/
continue investing in the high-end chemical new materials industry and focus on pioneering sectors that will China's Top 100 New Materials Companies Rankings Hurun Research Institute
shape the future. We are firmly committed to advancing industrial innovation from "1 to 10" and from "10 to 100"
actively addressing the challenges and opportunities presented by China's goals to peak carbon emissions and Innovation Leadership
achieve carbon neutrality. We will stay agile in response to development trends in the global chemical industry
List/
adjusting our strategic planning and product portfolio to sustain steady growth and seize new opportunities Forbes China Top 50 Most Innovative Companies Rankings Forbes China
in this rapidly evolving market. With a more open mindset and stronger actions we aim to expand our global
presence and establish ourselves as a company known for its excellent products recognized for its brand National 2023 Industrial Internet List/ Ministry of Industry and Information Technology
Pilot Demonstration 5G Factory Rankings of the People's Republic of China
reputation respected by society and held in pride by employees thereby joining the ranks of the world's leading
chemical enterprises. Economy and Information Technology Selected for Zhejiang's Second Batch of "Eagle Enterprises" List/Rankings Department of Zhejiang
Included in the "2024 Zhejiang Artificial Intelligence Application List/ Economy and Information Technology
Scenarios List" Rankings Department of Zhejiang
ESG Leadership
National
First Batch of "Green Leading Enterprises" Recognition China Quality Certification Center
Outstanding Sustainability Practices of Listed Companies List/Rankings China Association for Public Companies
Zhejiang Corporate Social Responsibility
Zhejiang's Top 100 ESG Performance Listed Companies List/Rankings Promotion Association and China Chengxin Green
Finance Technology (Beijing) Co. Ltd.List/ Responsibility 100 | CSR China Education Award CSR China Top 100 Rankings Organizing Committee
Responsibility 100 | CSR China Education Award
"Rural Revitalization and Social Development" ESG Action Award List/Rankings Organizing Committee
Cailianshe ESG Profound Awards – Environmental (E) Pioneer List/ Cailianshe
Enterprise Award Rankings
China Securities Journal China Reform Holdings
CRHC Cup * ESG Golden Bull Award List/Rankings Corporation Ltd. (CRHC) Nantong Municipal
People's Government
Aona Award for Enterprises with Sustainable Development List/ Social Responsibility Conference Organizing
Contribution Rankings Committee
China Enterprise ESG "Golden Responsibility Award" – Best List/
Rankings Sina FinanceResponsibility Progress Award
EY Outstanding Sustainable Development Enterprise of the Year List/Rankings EY Greater China
KPMG China Second ESG · 50 List – Outstanding Social Pioneers List/Rankings KPMG
108 109Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Appendices
Index of Reporting Guidelines Issue Item of Disclosure Chapter Index
3-1 Process to determine material topics Material Topics Analysis
Index of GRI Indicators GRI 3: Disclosures on
Material Topics 3-2 List of material topics Material Topics Analysis
3-3 Management of material topics Material Topics Analysis
Issue Item of Disclosure Chapter Index
201-1 Direct economic value generated and distributed About STL
2-1 Organizational details About STL 201-2 Financial implications and other risks and opportunities due to
climate change Addressing Climate Change
2-2 Entities included in the organization's sustainability reporting About This Report GRI 201: Economic Performance
201-3 Defined benefit plan obligations and other retirement plans Safeguarding Employee
2-3 Reporting period frequency and contact point About This Report Rights and Benefits
201-4 Financial assistance received from government /
2-4 Restatements of information /
202-1 Ratios of standard entry level wage by gender compared to Building a Harmonious Society with
2-5 External assurance Not Applicable local minimum wage People at the HeartGRI 202: Market Presence
202-2 Proportion of senior management hired from the local Building a Harmonious Society with
2-6 Activities value chain and other business relationships Stakeholder Communication community People at the Heart
2-7 Employees Building a Harmonious Society 203-1 Infrastructure investments and services supported
Fulfilling Corporate Social
with People at the Heart GRI 203: Indirect Responsibility
Building a Harmonious Society with Economic Impacts2-8 Workers who are not employees 203-2 Significant indirect economic impacts
Fulfilling Corporate Social
People at the Heart Responsibility
2-9 Governance structure and composition Corporate Governance GRI 204: Procurement Practices 204-1 Proportion of spending on local suppliers Advancing Responsible Procurement
2-10 Nomination and selection of the highest governance body Corporate Governance 205-1 Operations assessed for risks related to corruption Compliant and Stable Operations
2-11 Chair of the highest governance body Corporate Governance GRI 205: Anti-corruption 205-2 Communication and training about anti-corruption policies and procedures Compliant and Stable Operations
2-12 Role of the highest governance body in
overseeing the management of impacts Corporate Governance 205-3 Confirmed incidents of corruption and actions taken Compliant and Stable Operations
2-13 Delegation of responsibility for managing impacts Corporate Governance GRI 206: Anti-competitive 206-1 Legal actions for anti-competitive behavior anti-trust and
Behavior monopoly practices Compliant and Stable Operations
2-14 Role of the highest governance body in sustainability reporting ESG Management System 207-1 Approach to tax Strengthening Risk Prevention and Control
2-15 Conflicts of interest Stakeholder Communication 207-2 Tax governancecontrol and risk management Strengthening Risk Prevention and Control
GRI 2: General Disclosures GRI 207: Tax
2-16 Communication of critical concerns Stakeholder Communication 207-3 Stakeholder engagement and management of concerns related
to tax Stakeholder Engagement
2-17 Collective knowledge of the highest governance body ESG Management System 207-4 Country-by-country reporting /
2-18 Evaluation of the performance of the highest governance body Corporate Governance 301-1 Materials used by weight or volume /
2-19 Remuneration policies Building a Harmonious Society with People at the Heart GRI 301: Materials 301-2 Recycled input materials used Strengthening Environmental Management
2-20 Process to determine remuneration Building a Harmonious Society with People at the Heart 301-3 Reclaimed products and their packaging materials Strengthening Environmental Management
2-21 Annual total compensation ratio Building a Harmonious Society with 302-1 Energy consumption within the organization Focusing on Low-Carbon StrategiesPeople at the Heart
2-22 Statement on sustainable development strategy ESG Management System 302-2 Energy consumption outside of the organization Focusing on Low-Carbon Strategies
2-23 Policy commitments / GRI 302: Energy 302-3 Energy intensity Focusing on Low-Carbon Strategies
2-24 Embedding policy commitments / 302-4 Reduction of energy consumption Focusing on Low-Carbon Strategies
2-25 Processes to remediate negative impacts Strengthening Risk Prevention and Control 302-5 Reductions in energy requirements of products and services Focusing on Low-Carbon Strategies
2-26 Mechanisms for seeking advice and raising concerns Stakeholder Communication 303-1 Interactions with water as a shared resource Focusing on Low-Carbon Strategies
2-27 Compliance with laws and regulations Compliance Development 303-2 Management of water discharge-related impacts Water Resources Management
GRI 303: Water and
2-28 Membership associations Promoting Industry Development 303-3 Water withdrawal Water Resources ManagementEffluents
2-29 Approach to stakeholder engagement Stakeholder Communication 303-4 Water discharge Water Resources Management
2-30 Collective bargaining agreements Advancing Responsible Procurement 303-5 Water consumption Water Resources Management
110 111Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Appendices
Issue Item of Disclosure Chapter Index Issue Item of Disclosure Chapter Index
304-1 Operational sites owned leased managed in or adjacent to
protected areas and areas of high biodiversity value outside protected Biodiversity Protection 404-1 Average hours of training per year per employee Growing Together with Employees
areas
304-2 Significant impacts of activities products and services on Biodiversity Protection GRI 404: Training and 404-2 Programs for upgrading employee skills and transition biodiversity Growing Together with Employees
GRI 304: Biodiversity Education assistance programs
304-3 Habitats protected or restored Biodiversity Protection 404-3 Percentage of employees receiving regular performance and
career development reviews Growing Together with Employees
304-4 IUCN Red List species and national conservation list species
with habitats in areas affected by operations Biodiversity Protection
405-1 Diversity of governance bodies and employees Safeguarding Employee Rights and Benefits
305-1 Direct (Scope 1) GHG missions Focusing on Low-Carbon Strategies GRI 405: Diversity and
Equal Opportunity
305-2 Energy indirect (Scope 2) GHG emissions Focusing on Low-Carbon Strategies 405-2 Ratio of basic salary and remuneration of women to men Safeguarding Employee Rights and Benefits
305-3 Other indirect (Scope 3) GHG emissions） /
GRI 406: Non- 406-1 Incidents of discrimination and corrective actions taken Safeguarding Employee Rights and Benefits
GRI 305: Emissions 305-4 GHG emissions intensity Focusing on Low-Carbon Strategies discrimination
305-5 Reduction of GHG emissions Focusing on Low-Carbon Strategies GRI 407: Freedom of
Association and Collective 407-1 Operations and suppliers in which the right to freedom of
Bargaining association and collective bargaining may be at risk
/
305-6 Emissions of ozone-depleting substances (ODS) /
305-7 Nitrogen oxides (NOx) sulfur oxides (SOx) and other significant 408-1 Operations and suppliers at significant risk for incidents of Focusing on Low-Carbon Strategies GRI 408: Child Labor child labor Safeguarding Employee Rights and Benefitsair emissions
306-1 Waste generation and significant waste-related impacts Strengthening Environmental Management GRI 409: Forced or 409-1 Operations and suppliers at significant risk for incidents of
Compulsory Labor forced or compulsory labor Safeguarding Employee Rights and Benefits
306-2 Management of significant waste-related impacts Strengthening Environmental Management
GRI 306: Waste 306-3 Waste generated Strengthening Environmental Management GRI 410: Security Practices
410-1 Security personnel trained in human rights policies or
procedures Robust Safety Practices
306-4 Waste diverted from disposal Strengthening Environmental Management GRI 411: Rights of
Indigenous Peoples 411-1 Incidents of violations involving rights of indigenous peoples /
306-5 Waste directed to disposal Strengthening Environmental Management
413-1 Operations with local community engagement impact
308-1 New suppliers that were screened using environmental criteria Advancing Responsible Procurement assessments and development programs Fulfilling Corporate Social Responsibility
GRI 308: Supplier GRI 413: Local
Environmental Assessment 308-2 Negative environmental impacts in the supply chain and
actions taken Advancing Responsible Procurement
Communities
413-2 Operations with significant actual and potential negative
impacts on local communities Fulfilling Corporate Social Responsibility
GRI 401-1: New employee hires and employee turnover Safeguarding Employee Rights and Benefits
GRI 401: Employment 401-2 Benefits provided to full-time employees that are not provided
414-1 New suppliers that were screened using social criteria Advancing Responsible Procurement
to temporary or part-time employees Safeguarding Employee Rights and Benefits GRI 414: Supplier Social
Assessment
401-3 Parental leave Safeguarding Employee Rights and Benefits 414-2 Negative social impacts in the supply chain and actions taken Advancing Responsible Procurement
GRI 402: Labor/Management
Relations 402-1 Minimum notice periods regarding operational changes Safeguarding Employee Rights and Benefits
GRI 415: Public Policy 415-1 Political contributions /
403-1 Occupational health and safety management system Robust Safety Practices
403-2 Hazard identification risk assessment and incident Robust Safety Practices 416-1 Assessment of the health and safety impacts of product and investigation service categories High-Quality Products and Services
GRI 416: Customer Health
403-3 Occupational health services Robust Safety Practices and Safety 416-2 Incidents of non-compliance concerning the health and safety High-Quality Products and Services
403-4 Worker participation consultation and communication on impacts of products and services
occupational health and safety Robust Safety Practices
GRI 403: Occupational Health 403-5 Worker training on occupational health and safety Robust Safety Practices 417-1 Requirements for product and service information and labeling High-Quality Products and Services
and Safety
403-6 Promotion of worker health Robust Safety Practices
GRI 417: Marketing and 417-2 Incidents of non-compliance concerning product and service
403-7 Prevention and mitigation of occupational health and safety Labeling information and labeling Strengthening Risk Prevention and Control
impacts directly linked by business relationships Robust Safety Practices
403-8 Workers covered by an occupational health and safety 417-3 Incidents of non-compliance concerning marketing
management system Robust Safety Practices communications Strengthening Risk Prevention and Control
403-9 Work-related injuries Robust Safety Practices
GRI 418: Customer Privacy 418-1 Substantiated complaints concerning breaches of customer Strengthening Risk Prevention and Control
403-10 Work-related ill health Robust Safety Practices privacy and losses of customer data
112 113Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Appendices
IFRS S2 Recommended Disclosure Index ESG Performance Indicators*
Indicator Unit 2024 2023 2022
Recommended Disclosure Related Chapter
Governance Performance
Disclose the governance body(s) (which can include a board committee or equivalent body
charged with governance) or individual(s) responsible for oversight of climate-related risks and ESG Management System Operating income RMB'00 million 456.48 414.87 370.43
opportunities.Year-on-year growth in operating income % 10.03 12.00 29.71
Governance
Total profit RMB'00 million 70.18 53.68 34.48
Disclose the management's role in the governance processes controls and procedures used to
monitor manage and oversee climate-related risks and opportunities. ESG Management System Net profit attributable to listed company shareholders RMB'00 million 60.72 47.89 30.96
Total assets RMB'00 million 683.05 645.82 597.64
Disclose the climate-related risks and opportunities that could reasonably be expected to
affect the entity's prospects. Addressing Climate Change Net assets attributable to the parent company RMB'00 million 302.86 254.65 221.60
General Meeting of Shareholders time 2 5 5
Disclose the current and anticipated effects of those climate-related risks and opportunities Addressing Climate Change Meetings of the Board of Directors time 8 8 7on the entity's business model and value chain.Meetings of the Board of Supervisors time 6 7 7
Special audit projects project 22 26 30
Disclose the effects of those climate-related risks and opportunities on the entity's strategy
Strategy and decision-making including information about its climate-related transition plan.Addressing Climate Change
Anti-corruption audit projects project 30 / /
Business ethics training
Disclose the effects of those climate-related risks and opportunities on the entity's financial
position financial performance and cash flows for the reporting period and their anticipated Total hours of training hour 120 / /
effects on the entity's financial position financial performance and cash flows over the Addressing Climate Change
short medium and long term taking into consideration how those climate-related risks and Total sessions of training session 160 / /
opportunities have been factored into the entity's financial planning.Number of directors trained person 9 / /
Disclose the climate resilience of the entity's strategy and its business model to climate- Percentage of directors trained % 100 / /
related changes developments and uncertainties taking into consideration the entity's Addressing Climate Change
identified climate-related risks and opportunities. Number of senior managers trained person 1200 / /
Percentage of senior managers trained % 100 / /
Disclose the processes and related policies the entity uses to identify assess prioritize and Strengthening Risk
monitor climate-related risks. Prevention and Control Total number of employees trained person 5057 / /
Percentage of employees trained % 100 / /
Risk Disclose the processes the entity uses to identify assess prioritize and monitor climate-
Management related opportunities including information about whether and how the entity uses climate- Addressing Climate Change Business ethics auditsrelated scenario analysis to inform its identification of climate-related opportunities.Audit projects project 30 / /
Disclose the extent to which and how the processes for identifying assessing prioritising and Audit sessions session 12 / /
monitoring climate-related risks and opportunities are integrated into and inform the entity's Addressing Climate Change
overall risk management process. Audit coverage % 67 / /
Social Performance
Disclose information relevant to the cross-industry metric categories. /
Number of R&D personnel person 1275 1271 992
Bachelor's degree person 1020 1151 882
Disclose industry-based metrics that are associated with particular business models activities
Metrics and or other common features that characterize participation in an industry. / Doctorate or master's degree person 255 120 110
Targets
R&D investment RMB'00 million 17.51 16.26 12.41
Disclose targets set by the entity and any targets it is required to meet by law or regulation to Year-on-year growth in R&D expenses % 7.69 31.05 15.14
mitigate or adapt to climate-related risks or take advantage of climate-related opportunities
including metrics used by the governance body or management to measure progress towards Addressing Climate Change Ratio of R&D expenses to operating income % 3.84 3.92 3.35
these targets.*In 2024 the Company further refined its data collection process adjusted the scope of certain data collection to improve disclosure and revised some
previously disclosed data.
114 115Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Appendices
Indicator Unit 2024 2023 2022 Indicator Unit 2024 2023 2022
Patent filed1 item 273 83 107 Number of new suppliers company 134 143 96
Patent granted2 item 135 98 93 Number of new suppliers screened using social criteria company 95 89 65
Accumulative number of valid patents item 438 320 234 Number of new suppliers screened using environmental
criteria company 124 121 73
Training on intellectual property protection Supplier training session 1 1 1
Training sessions conducted session 9 5 3 Number of suppliers that received training company 2249 236 178
Employees trained person-time 80 49 33 Percentage of suppliers that received training % 88 9 7
Total hours of training provided hour 36 5.5 3 Number of suppliers that were audited company 36 32 28
Product recall time 0 0 0 Supplier audit coverage % 1.40 1.30 1.10
Value of recalled products RMB'0000 0 0 0 Number of suppliers required to make rectification company 33 32 27
Percentage of products recalled % 0 0 0 Number of national standards the Company
participated in developing item 8 7 1
Number of mock product recalls time 0 0 0 Number of industry standards the Company
participated in developing item 1 1 1
Training on product quality and safety Number of social organization standards the Company
participated in developing item 4 3 2
Training sessions provided session 43 23 6
Number of employees person 5057 4688 3964
Total number of employees trained person-time 1076 825 148
By gender
Total hours of training provided hour 70.5 43.5 16
Male person 4221 3881 3256
Coverage of ISO 9001 Quality Management System
% operational site 100 100 /
certification Female person 836 807 708
Customer satisfaction % 100 100 100 By age group
Complaint resolution rate % 100 100 100 30 or below person 2190 1825 1567
Total number of suppliers company 2560 2510 2432 30-50 person 2531 2482 2035
North China company 157 146 132 Above 50 person 336 381 362
East China company 2043 2038 2005 Labor contract signing rate % 100 100 100
South China company 59 51 47 Social insurance coverage rate % 100 100 100
Central China company 80 76 71 Employee training coverage rate % 100 100 /
Southwest China company 27 23 19 Total number of employees trained person 5057 4688 3964
Northwest China company 27 24 21 Training attendance by gender
Northeast China company 82 76 73 Male person 4221 3881 3256
Hong Kong Macao and Taiwan China company 15 12 10 Female person 836 807 708
Overseas company 70 64 54 Training attendance by job level
Number of suppliers with contracts that include General employees person 4835 4491 3760
environmental labor and human rights clauses company 2331 2210 2073
Percentage of suppliers with contracts that include % 91 88 85 Middle management person 184 164 164environmental labor and human rights clauses
Number of suppliers that signed the Integrity Senior management person 38 33 40
Agreement company 2560 2243 2122
Percentage of suppliers that signed the Integrity CPC members person 594 493 499
%1008987
Agreement Total person-times of employees trained person-time 239014 198618 159099
116 117Satellite Chemical Co. Ltd. 2024 Environmental Social and Governance Report Appendices
Indicator Unit 2024 2023 2022 Indicator Unit 2024 2023 2022
Total hours of training hour 436544 456659 516154 Environmental Performance
Average hours of training per person hour 86 97 130 Total investment in environmental governance RMB'0000 130957 170465 142857
Total expenditure in employee training RMB'0000 422.10 285.30 283.90 Time invested in environmental governance hour 61320 74400 62130
Percentage of employees regularly assessed for Person-times of employees trained in person-time 17792 45548 31255
performance and career development % 100 100 100 environmental protection
Investment in supporting employees' educational Hazardous waste generated tonne 125125.82 139198.83 85672.92
advancement RMB'0000 10.70 14.00 3.90 Non-hazardous waste generated tonne 61105.38 7650.10 8486.05
Occupational health checkup rate % 100 100 /
Total solid waste tonne 186231.20 146848.93 94158.97
Work-related fatalities person 0 0 0 Solid waste intensity tonne per 10000 tonne products 0.015 0.015 0.015
Lost days due to work-related injuries day 0 0 0 Nitrogen oxides (NOx) emissions3 tonne per 10000 tonne products 0.616 0.554 0.776
Lost hours due to work-related injuries hour 0 0 0 Sulfur dioxide (SO2) emissions tonne per 10000 tonne products 0.067 0.106 0.098
Occupational disease health checkup coverage rate % 100 100 100 Volatile organic compounds (VOCs) emissions tonne per 10000 tonne products 0.252 0.257 0.256
Total investment in occupational health and safety RMB'0000 968.83 212.73 166.47 Particulate matter (PM) emissions tonne per 10000 tonne products 0.043 0.054 0.066
4
Investment in work injury insurance RMB'0000 343.74 270.02 283.49 Chemical oxygen demand (COD) emissions tonne per 10000 tonne products 2.245 2.077 2.016
5
Work injury insurance coverage rate % Ammonia nitrogen emissions tonne per 10000 tonne products 0.026 0.024 0.009100 100 100
Total organic carbon (TOC) emissions6 tonne per 10000 tonne products 0.161 0.096 0.123
Investment in work safety insurance RMB'0000 106.50 83.31 36.11
Total GHG emissions tCO2e 6185581 5853177 3817387
Work safety insurance coverage rate % 100 100 100
GHG intensity tCO2e per tonne products 0.502 0.627 0.624
Number of emergency drills time 948 816 426
Direct energy consumption
Number of employees who participated in emergency
drills person 17527 13811 8366 Gasoline liter 598995.39 546684.92 454166.89
Number of occupational health and safety training
sessions session 628 343 224 Diesel liter 297574.26 283915.29 315887.76
Total number of employees trained in occupational person-time 34848 25649 12280 Natural gas cubic meter 277614769.39 279519427.80 143216462.10health and safety
Ethane tonne 63151.18 38684.77 94656.25
Total hours of occupational health and safety training hour 58700 55622 27180
Indirect energy consumption
Total investment in community welfare RMB'0000 4223.58 / /
Purchased electricity MWh 5276353.19 5046442.25 4136774.79
Community welfare investment by area
Purchased steam GJ 13559044.66 13299954.16 4637155.50
Healthcare RMB'0000 202.91 / / Total energy consumption tce 1440464.12 1281585.65 838737.09
Education RMB'0000 74.10 / / Energy intensity tce per 10000 tonne products 1169.60 1129.91 1127.99
Disaster relief RMB'0000 20.00 / / Clean energy consumption
Rural revitalization RMB'0000 35.67 / / Purchased electricity from new energy sources MWh 765023.99 517585.28 469828.48
Other (e.g. assistance for people in need charitable
donations) RMB'0000 3890.90 / /
Photovoltaic power generation MWh 1772.91 1887.40 104.64
Other clean energy consumption MWh 40000 0 0
Community welfare investment by type
Total water consumption million tonne 741.60 566.74 489.20
Monetary donations RMB'0000 3977.53 / /
Water intensity million tonne per 10000 tonne 0.60 0.50 0.66
In-kind donations RMB'0000 246.05 / / products
Recycled and reused water7 10000 tonnes 70278.58 52692.37 45851.81
Number of participants in volunteering activities person 660 / /
Percentage of recycled and reused water % 94.76 92.97 93.72
Total hours of volunteering service hour 94380 / /
Reduction in wastewater discharge 10000 tonnes 281.87 41.49 11.12
Total person-times of blood donation since 2012 person-time 1495 1304 /
Environmental monitoring / 84 116 115
Total volume of blood donated since 2012 ml 477600 412300 / Total packaging materials purchased tonne 54.00 59.04 34.08
Jobs provided by "Common Prosperity Workshops" and
"Common Prosperity Workspaces" person 978 920 /
Average monthly salary at "Common Prosperity
Workshops" and "Common Prosperity Workspaces" RMB ≥9000 ≥7000 /
1-2 The data for 2022 and 2023 has been adjusted increasing the number of software copyright patents.
3-7During the reporting period the Company introduced new equipment to produce raw materials that previously had to be sourced externally. As a
key step toward industry chain integration this has enhanced production efficiency and product quality and strengthened the Company's market
competitiveness. The Company is actively advancing the construction and optimization of supporting wastewater and exhaust gas treatment facilities to
minimize environmental impact continuously improving water efficiency in related processes and ensuring the coordinated development of its business
and environmental protection.
118 119Satellite Chemical Co. Ltd.
Address: No. 196 Fuqiang Road Nanhu District Jiaxing
Zhejiang Province China
Postal Code: 314050
Telephone: （86）573-82229096
E-mail: esg@weixing.com.cn
Official website:https://www.stl-chem.com
沪公网安备31011802005267号
