Sustainable Uniting Hearts Collective Full Lifecycle Compliance Toward a Shared Guardianship of

Independent Key Indicator Feedback

Service Governance Vision Community Well-

Assurance Performance Index and

being Statement Table Suggestions

1CONTENTS

About This Report 01 About LAZZEN 05

Message from the Chairman 03 Honors in 2024 09

Digital-Intelligent New Supply Chain Responsi- Uniting Hearts Toward

Quality Production bility Management a Shared Vision

Innovation-led Growth 13 Supplier Management 61 Employee Management 95

Digital-Intelligent Ecosystem Products 19 Green and Sustainable Supply Chain 63 Work Safety and Occupational Health 102

Smart Future Factory 23 Building a Stable and Secure Supply Chain 64

Climate Change and Full Lifecycle Collective Guardianship

Opportunities Service of Community Well-being

Addressing Climate Change 31 Product Quality 67 Industry Collaboration 109

Energy Management 36 Customer Service 70 Community Welfare 112

Clean Technology Opportunities 39 Customer Privacy and Security 74

Building a Green New Sustainable Compli-

Ecosystem ance Governance

Environmental Compliance Management 45 Sustainable Development Management 77 Independent Assurance Statement 113

Resource Management 49 Corporate Governance 80 Key Performance Table 116

Pollutant Emissions 52 Risk Control and Compliance 83 Indicator Index 121

Waste Disposal 55 Business Ethics 88 Feedback and Suggestions 125

Chemical Management 57

CONTENTSAbout This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain

Collective

New Quality Responsibility Full Lifecycle

Sustainable Uniting Hearts Guardianship of Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Service Compliance Toward a Shared Community Well- Assurance Performance

Indicator and

Production Management Governance Vision Indexbeing Statement Table Suggestions

About This Report

Report Description Reporting Principles

This report is the third ESG report issued by Shanghai Liangxin Electrical Co. Ltd. (hereinafter referred to as "LAZZEN" "the Com-

pany" or "We") for stakeholders. It provides a detailed disclosure of the Company's practices and performance in the areas of en-

vironmental social and governance for the year 2024 aiming to systematically respond to the expectations and requirements of Timeliness Sustainability:

stakeholders.As an annual report the reporting period is from LAZZEN actively responds to sustainability trends

January 1 2024 to December 31 2024. The report is identifies stakeholders and key issues based on the

Reporting Scope and Boundaries prepared promptly after the end of the 2024 fiscal year characteristics of the electrical equipment industry and released after reviewing of the Board of Directors and its operations and engages in stakeholder com-

but not earlier than the release of the annual report. munication. For details please refer to section 6.1 on

The reporting period spans from January 1 2024 to December 31 2024 (hereinafter referred to as the "Reporting Period") cover- Sustainable Development Management.ing the performance in fulfilling environmental social and governance responsibilities in 2024. For the sake of continuity and com-

parability certain content appropriately traces back to previous years.Accuracy Balance

The scope of disclosure is consistent with the financial information disclosed in the 2024 Annual Report.LAZZEN strives to ensure the accuracy of information. The content reflects the LAZZEN's operations objec-

Quantitative data is based on actual production and tively avoiding exaggeration or misleading descrip-

operations and contains no false records misleading tions and fully discloses both positive and negative

Data Explanation statements or major omissions. information to maintain fairness and objectivity.The financial data in this report originates from the audited financial statements while other data is derived from the internal doc- Completeness Verifiability

umentation and statistical summaries. Unless otherwise stated all monetary figures are denominated in RMB. This report contains

no false records misleading statements or major omissions. The Company takes individual and joint responsibility for the authen- The data covers LAZZEN and its controlled entities The cases management systems and quantitative

ticity accuracy and completeness of its content. consistent with the scope of the annual report and data come from actual operations and are traceable.fully discloses relevant information.Compilation Guidelines Clarity Quantification

Charts data references and technical terms are ex- Quantitative data is disclosed continuously and with

●?2030 United Nations Sustainable Development Goals (SDGs) plained clearly with sources cited where necessary. improved reliability to demonstrate the development

●?Global Sustainability Standards Board (GSSB) Sustainability Reporting Standards (GRI Standards 2021 Edition) trend of ESG management.●?Chinese Academy of Social Sciences China CSR Report Preparation Guide (CASS-ESG 6.0)

●?China National Standard Guidance on Social Responsibility Reporting (GB/T 36001-2015)

●?International Organization for Standardization ISO 26000: Social Responsibility Guidance (2010)

●?Shenzhen Stock Exchange Self-Regulatory Guidelines No. 17 for Companies Listed on Shenzhen Stock Exchange—Sustainability Report Release and Contact Information

Report (For Trial Implementation)

●?Shenzhen Stock Exchange Self-Regulatory Guidelines No. 3 for Companies Listed on Shenzhen Stock Exchange – Sustainability The electronic version of this report Shanghai Liangxin Electric Co. Ltd.Report Compilation can be viewed or downloaded from the

official website of Shanghai Liangxin

Phone: +86-21-68586699 Email: liangxin@sh-liangxin.com

Electrical Co. Ltd.(www.sh-liangxin.Data Sources com). The Company will continuously Fax: +86-21-23025796 Supervision: audit@sh-liangxin.com

improve the disclosure quality and ESG

governance. For any questions or sug- Address: No. 2000 Shenjiang South

The ESG data and information in this report come from the original records of LAZZEN and its subsidiaries. The currency unit for all gestions please contact via the follow- Road Pudong New Area Shanghai

amounts mentioned is RMB. In case of any discrepancies with the financial report the financial report shall prevail. ing channels:

01 02About This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective

New Quality Responsibility Compliance Toward a Shared Guardianship of

Independent Key Indicator Feedback

Report the Chairman LAZZEN 2024 Production Opportunities New Ecosystem Management Service Governance Vision Community Well-

Assurance Performance and

being Statement Table

Index Suggestions

Message from the Chairman

Dear colleagues partners and members of Innovation-led Growth of New Quality Productivity Responsibility and Full Lifecycle Manage-

the community:

With a focus on high R&D investment and continuous innovation LAZ- ment

In 2024 under the strategic guidance of ZEN continuously increases R&D investment focusing on intelligent LAZZEN builds a green and sustainable supply chain

"Dual Intelligence One Innovation Dual power distribution smart living and new energy fields to become a and conducts social and environmental impact assess-

Transformation One Value Chain" LAZZEN leader in smart electrical solutions. During the reporting period we ments of suppliers. Upholding the quality philosophy

remains committed to the mission and vi- were honored with the Second Prize of National Science and Tech- of "Customer-Centered Quality as Dignity" we have

sion of "Achieving Excellence in Low-Voltage nology Progress Award for our exceptional research achievements. completed multiple management system certification

Electrical Appliances and Building a Smart By strengthening the transformation of technological achievements updates with 100% coverage of the quality manage-

Electrical Zero-Carbon New Ecosystem". With improving R&D efficiency and quality and optimizing the intellectual ment system. We are committed to improving custom-

unwavering determination all LAZZEN em- property management system we have built a leading research team er service quality and ensuring that customer feedback

ployees strive to drive corporate high-quality collaborated with partners to establish a comprehensive cooperation is handled in a closed-loop manner. In 2024 we con-

development through innovation-led growth mechanism shared frontier technology insights and incubated inno- tinuously launched the "Pursuing Knowledge Together

green-oriented leadership and responsibili- vative ideas thereby creating a smart electrical ecosystem. for a Shared Future" series of activities partnering with

ty-driven actions. the industry to explore frontier technologies and de-

Green and Low-Carbon Sustainable Development velopment trends.LAZZEN actively responds to the carbon peaking and carbon neutrality

goals deeply integrating ESG concepts with corporate development From Accumulated Efforts to Shared Pros-

and has positioned green and low-carbon initiatives as long-term de- perity

velopment goals. We actively conduct carbon audits and inspections LAZZEN strictly complies with national laws and regu-

have built a smart energy management platform improved energy ef- lations protects employees' legal rights continuously

ficiency and reduced carbon emissions. During the reporting period optimizes the compensation and benefits system ex-

the consumption of clean energy reached 4705.14MWh. Additionally pands communication channels for employee participa-

we incorporate green ecological concepts into product design seize tion in decision-making and improves promotion and

opportunities in new energy products strive to build a clean low-car- performance evaluation processes to foster employees'

bon safe and efficient future energy system and advance zero-car- professional growth. Additionally LAZZEN actively par-

bon factory construction to contribute to the national carbon peaking ticipates in social welfare projects supports rural revital-

and carbon neutrality strategy. ization focuses on education and provides assistance

to disadvantaged groups.Quality Improvement and Efficiency Enhancement for

Looking ahead LAZZEN will always be guided by cus-

Building a Smart Future Factory tomer needs continuously improving the quality of our

LAZZEN leverages industrial internet data simulation technology and products and services driven by technological innova-

digital twin technology to achieve full transparency measurability tion we will tackle "bottleneck" challenges in key fields

Chairman: Silong Ren and traceability in production processes. The LAZZEN Hangzhou Bay and adhering to the principles of sustainable develop-

Super Factory was recognized as a "Future Factory of Zhejiang Prov- ment to build a green and low-carbon industrial ecosys-

Shanghai Liangxin Electrical Co. Ltd. ince" and passed the Intelligent Manufacturing Capability Maturity tem. We will enhance communication and cooperation

Certification. We promote digital and intelligent transformation in four with stakeholders explore new paths for sustainable

areas: smart and intelligent factories production logistics and agile development and strive for the construction of a smart

supply chains thereby accelerating high-quality development. electrical zero-carbon ecosystem.

03 04About This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective Independent Key Feedback

Report the Chairman LAZZEN 2024 New Quality Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared

Guardianship of Assurance Performance Indicator and

Production Management Governance Vision Community Well- Indexbeing Statement Table Suggestions

About LAZZEN

Company Profile

Founded in 1999 LAZZEN positions itself as an

"Expert in Intelligent Electrical Solutions" focusing

on the research production sales and service of

terminal electrical appliances distribution electrical

appliances control electrical appliances intelligent

distribution and smart living. LAZZEN's products

and solutions are widely applied across various sce-

narios from power generation and transmission to

end-user consumption covering over 30 sub-indus-

tries including intelligent computing centers new

energy infrastructure rail transit smart buildings

power grids and industrial control.As a listed company on the Shenzhen Stock Ex-

change (Stock Code: 002706.SZ) LAZZEN achieved

a revenue of RMB 42.37 billion in 2024. We adhere to

the core value of "Pursuit of Customer Success" driv-

ing product development through customer needs.The R&D center has earned recognition as a "Nation-

al Enterprise Technology Center". We've established Core Values Development Strategy

a "Postdoctoral Research Workstation". Moreover

our laboratory has been granted dual certification

Pursuit of customer success

from CNAS (China National Accreditation Service)

and UL (Underwriters Laboratories) in the U.S. Remain customer-centric consistently meet custom-

er demands help customers succeed and realize

common development for our customers our com-

pany our team and individuals.Mission and Vision Responsibility and ambition

Be ambitious innovative and willing to assume and

To achieve excellence in low-voltage apparatus and embrace responsibility and become an industry

collaboratively build a new zero-carbon ecosystem of leader trusted by customers. Focus on low-voltage apparatus Excel in intelligent power distri- Become an expert in smart

smart electrical solutions. and implement a target concen- bution smart homes and new apparatus solutions.Pursuit of truth and introspection tration strategy. energy electrical technologies.Respect the law seek truth from facts be honest and

trustworthy grow by self-reflection find the root

cause constantly pursue excellence and maintain

diligence.Business Presence

Openness and collaboration

Be inclusive to different cultures listen to different LAZZEN's core business includes terminal electrical appliances distribution electrical appliances control electrical appliances

opinions and suggestions embrace changes recruit intelligent distribution and smart living. The service network covers over 140 cities nationwide and more than 30 countries and

talents make concerted efforts towards the same regions globally providing professional and efficient services to customers worldwide through an end-to-end organization and sys-

goal and pursue overall optimal results. tem.

05 06Collective

About This Message from About Honors in Digital-Intelligent New Quality Climate Change and Building a Green

Supply Chain Full Lifecycle Sustainable Uniting Hearts Responsibility Compliance Toward a Shared Guardianship of

Independent Key Indicator Feedback

Report the Chairman LAZZEN 2024 Assurance Performance and Production Opportunities New Ecosystem Management Service Governance Vision Community Well- Indexbeing Statement Table Suggestions

LAZZEN Hangzhou Bay Super Factory awarded Zhejiang LAZZEN hosted the "Converging Power Advancing Miles" LAZZEN and Sineng inaugurated a joint laboratory at

2024 Province Future Factory recognition Global Partner Conference recognizing 41 outstanding the Shanghai headquarters exploring future new energy suppliers technology

Key Events of

LAZZEN

LAZZEN Hangzhou Bay

Super Factory certified for

Intelligent Manufacturing

Capability Maturity

LAZZEN held the 2024 Intelligent Building Sustainable The latest products passed UL

Development Conference and Human Settlements Tech- certification in the U.S. Austral-

nology & Innovation Forum launched the LAZZEN Magic ian standards certification and

Cube Digital Home Integration Box leading new stand- Korea's KC certification demon-

ards for smart living strating that the product quality

and safety performance have

received high recognition

LAZZEN awarded 2023 Na-

tional Science and Technol-

ogy Progress Award (Second

Prize)

Xinhua News Agency interviewed the Hangzhou Bay Su- LAZZEN signed a strategic cooperation agreement with Approved to establish a National Postdoctoral Research

per Factory analyzing digitalization and the dual-carbon Bureau Veritas to co-create a zero-carbon intelligent elec- Workstation to conduct in-depth research in areas such

strategy from three perspectives: zero-carbon park smart trical ecosystem as source-network-load-storage integration and low-car-

park and intelligent manufacturing bon energy-saving

07 08About This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective

New Quality Responsibility Compliance Toward a Shared Guardianship of

Independent Key Feedback

Report the Chairman LAZZEN 2024 Assurance Performance

Indicator and

Production Opportunities New Ecosystem Management Service Governance Vision Community Well- Indexbeing Statement Table Suggestions

Honors in 2024

LAZZEN LAZZEN

2023 National Science and Tech- 8th International Energy Storage Innovation

nology Progress Award (Second Shanghai High-Tech Achievement Transfor- Competition 2024 Excellent Project in Energy

China Engineering Survey and

Prize) National Postdoctoral Research mation Project Certificate - Residual Current Storage Safety Track - Application of Innova-

2021-2024 China Best Managed Design Industry Building Electri-

Station (National Level) Operated Circuit Breaker (NDB2LM-63 ND- tive Energy Storage Isolation Switch Product Companies cal Competitiveness Brand - Low

B2LM-40) Voltage Cabinet and ComponentsCentral Committee of the Commu-

nist Party of China State Council of Shanghai Talent Work Bureau International Energy Storage Technology and

Deloitte China Best Managed

the People's Republic of China Shanghai Science and Technology Commission Industry Alliance Zhongguancun Energy Storage

Companies Intelligent Building Electrical

Industry Technology Alliance Technology Magazine

2023 Outstanding Contribution Gaohang Town Outstanding Contribution Award 2024 Top 100 Shanghai Manufacturing Enter-Award for Private Enterprises in prises Best Carbon Coordination Ex- Most Popular Electrical Supplier

Pudong New Area Best Cooperation AwardGaohang Town Committee of the ploration Award

Communist Party of China People's Shanghai Enterprise Association Shanghai China Architectural Society People's Government of Pudong Economic Association Shanghai Entrepreneur Bureau Veritas Group Building Electrical Branch Hopewind

New Area Shanghai Government of Gaohang Town Pudong New Area Association Jiefang Daily

LAZZEN Haiyan LAZZEN Shanghai

Liangyun Technology

2024 Outstanding Project Award for Shanghai Indus-

2024 Top 100 Shanghai Private 2024 Top 100 Shanghai Private try-Academia-Research Cooperation (Nomination Future Factory of Zhejiang

Manufacturing Enterprises Enterprises Award) - Key Technology R&D and Application of Intelli- Best New Supplier Province

gent Molded Case Circuit Breakers Project

Shanghai Enterprise Association Shanghai Enterprise Association Zhejiang Provincial Department Software Enterprise Certificate

Shanghai Entrepreneur Associa- Shanghai Entrepreneur Associa- GoldwindShanghai Technology Achievement Transformation Promo- of Economy and Information

tion Jiefang Daily tion Jiefang Daily Technology China Software Industry Associationtion Association Shanghai Education Development Foun-

dation Shanghai Science and Technology Commission

09 10Supporting of the UN SDGs

01

Digital-Intelligent New

Quality Production

Concept

LAZZEN focuses on high R&D investment and continuous innovation center-

ing on the "Dual Intelligence One Innovation" strategy (Intelligent Power Dis-

tribution Smart Living and New Energy). With a customer- centric approach

we respond swiftly to market demands by developing tailored products. We

prioritize talent development building a world-class technical talent ladder

enhancing R&D efficiency and quality through the application of scientific

achievements and optimizing the intellectual property management system.Furthermore we actively promote organizational innovation by establishing

comprehensive cooperation mechanisms with partners for sharing cut-

ting-edge technologies and incubating innovative ideas thereby creating a

new smart electrical ecosystem.Our Actions

●?Innovation-led ●?Digital-Intelligent ●?Smart Future

Growth Ecosystem Products Factory

Key Performance

LAZZEN has 348 invention patents applied to its core business operations

The product quality PPM (Parts Per Million) at LAZZEN's Hangzhou Bay Super

Factory decreased by 15.3 %

LAZZEN successfully completed 10 digital transformation projectsAbout This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective

New Quality Responsibility Compliance Toward a Shared Guardianship of

Independent Key Feedback

Report the Chairman LAZZEN 2024 Assurance Performance

Indicator and

Production Opportunities New Ecosystem Management Service Governance Vision Community Well- Indexbeing Statement Table Suggestions

Innovation-Driven Strategy

LAZZEN has formulated a three-year R&D strategic plan focusing on four strategic pillars: technological innovation market ex-

pansion talent cultivation and international cooperation. From 2025 to 2027 LAZZEN will concentrate on high-voltage product

technology high-breaking performance technology technology reserves for overseas market requirements solid-state technology

applications and intelligent distribution AI technology applications to strengthen R&D capabilities and technical expertise.●?Application of solid-state product tech-

nology in the low-voltage electrical field

●?Increasing performance requirements for

●?

high-voltage and high-current products Early-stage technical reserve planning for

cutting-edge technology products in the

●?Product safety and reliability industry

●?Inheritance of past technological trends ●?Innate digital-intelligent genes enabling

smart applications. Power industry trans-

Innovation-led Growth formation and grid interconnection

LAZZEN places great emphasis on scientific innovation continuously refining research management and incentive mechanisms

while strengthening intellectual property protection. The Company consistently expands investment in R&D builds a world-class

R&D team and actively promotes the transformation and application of scientific achievements striving to provide exceptional Technical

products to customers. High-Voltage High Breaking Reserves for Solid-State

AI Technology

Product Tech- Performance Overseas Mar- Technology

Application

nology Technology ket Require- Application

R&D Management ments

Innovation-Driven Governance

LAZZEN has established and optimized the internal Technical Innovation Award Selection System continuously improving the ●?Breakthrough in industry voltage ●?High standards for overseas ●?Enhancing product health predic-

structure of R&D teams and the incentive policies for scientific researchers such as the Mozi Expert Allowance. We continuously levels (DC2000+ AC3300V) with a markets such as UL standards tion capabilities

enhance talent reserves by building an industry-academia-research cooperation system strengthening postdoctoral research cost reduction trend including electrical endurance

●?

stations and setting up specialized groups and LAZZEN University training programs. Through the strategic management tools Integration of cross-industr y

●?Voltage upgrade expected to fully breaking capacity and tempera-

we comprehensively evaluate new industry technologies customer needs and internal shortcomings to formulate targeted risk technical expertise to empower expand in the market within 1-2 ture rise (UL077 UL98 UL489)

response measures. The well-established scientific research training system promotes stable development and governance opti- new technological advantages in years ●?

mization under the innovation-led growth strategy. Future product standardization low-voltage electrical products

●?Inheritance of past technological to establish a technical founda-

We have established the ITMT Integrated Technology Management Team responsible trends tion for cost advantages

for enhancing the competitiveness of the public and cutting-edge technologies. By

organizing technology roadmap planning technology investment decisions project Innovation-Driven Three-Year Development Strategy

initiation and evaluation we strengthen product technology competitiveness and

establish product leadership. Assessment indicators are closely tied to the "Dual

Intelligence One Innovation and Dual Transformation One Value Chain" strategy 01 02 03 04

including analyzing future three-to-five-year technology roadmap customer needs

A rc Ext i n g u i s h i n g Key Heat Dissipation Transmission Key Electromagnetic Drive Key

competitor and patent analysis frontier technology analysis and producing accurate

and forward-looking technical strategies and panoramic reports. Additionally the Technologies Key Technologies Technologies Technologies

evaluation includes the implementation rate achievement rate and transfer rate ●?Pure solid-state and hybrid sol- ●?High and Low Fre- ●?Remote and trip- ●?Fast switching mechanism

of the technology planning output projects to ensure smooth implementation and id-state technologies quenc y Breaking ping technologies ●?Adjustable low-ratio tripper

timely completion ultimately applying them to products. ●?Low-cost permanent magnet arc Technologies ●?Permanent magnet mechanism

extinguishing technology ●?Compact tripper

In 2024 LAZZEN achieved significant scientific research results including DC frame

●?Multi-grid arc guiding technology

intelligent molded case high-voltage disconnect switch Magic Link Power intelligent

●?Zero arc flash technology

distribution platform NEA smart brand cabinet load identification and load predic-

tion. Joint R&D projects with customers also achieved significant breakthroughs. National Science and Technology Progress

Award Four Strategic Pillars of LAZZEN

13 14Collective

About This Message from About Honors in Digital-Intelligent Supply Chain New Quality Climate Change and Building a Green Responsibility Full Lifecycle

Sustainable Uniting Hearts Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Service Compliance Toward a Shared

Guardianship of

Community Well- Assurance Performance

Indicator and

Production Management Governance Vision being Statement Table

Index Suggestions

Scientific Research Incentives Talent Cultivation

LAZZEN has comprehensively updated and optimized the incentive mechanism for scientific research projects to fully catalyze To implement the product leadership strategy LAZZEN recruits industry experts and builds a learning-oriented organization through

employees' innovation vitality and work enthusiasm. These incentives play a positive role in technological innovation project LAZZEN University which includes Edison Academy Pangu Academy Rock Academy Ganjiang Academy and Lean Academy. These

management cost control and talent cultivation driving the Company's sustainable development and laying a solid foundation initiatives continuously meet job demands and promote employee development to achieve research-driven goals. Specialized groups

for steady progress. in structure electromagnetics and thermal fields conduct over 30 professional sharing sessions and host more than 6 Mozi Expert

technical sharing events helping employees broaden their expertise and enhance the Company's competitiveness.In 2024 two postdoctoral researchers in the station achieved remarkable results. The Hybrid (250A) Solid-State Circuit Breaker project

applied for seven invention patents. The project Key Technology Research on Low-Carbon Energy Saving and Smart Living Equipment

Technological Inno- Based on AI achieved its first-stage goal by applying for three invention patents and publishing two EI-indexed papers. These research

vation Award: 01 Gold Project Award 02 outcomes provided new insights and technical support for LAZZEN's smart living and low-carbon energy-saving fields.Designed to reward teams or indi- Targets teams that excel in major devel-

viduals who achieve significant tech- opment and implementation projects

nological innovation breakthroughs in areas such as product marketing

during product development there- technology procurement manufac-

by accelerating product innovation turing and functions. The evaluation

cycle. Evaluation criteria include the dimension is the active practice of LAZ-

number of technological innovation ZEN's core values (Customer Success

achievements the number of patents Responsibility Initiative Truth-Seeking

for innovative products and success- Self-Reflection Openness and Collabo-

ful commercial cases of technology ration). The award establishes the Gold

transfer. The award categories include Project Award with recognition meth- Learning-Oriented Organization Series Course Activities

Grand Prize First Prize Second Prize ods including medals financial incen-

Third Prize and Excellence Award. tives OA system announcements and

Recognition methods include medals offline conference commendations.monetary rewards OA system an- Innovation-Driven Risk Assessment

nouncements and offline conference

commendations. Outstanding contrib- LAZZEN continuously monitors risk management in innovation-led growth. To meet current and potential customer needs we

utors may also receive full reimburse- deeply analyze customer application scenarios. Every fourth quarter we plan the strategy-to-execution (DSTE) process for the next

ment for international study tours. year and the following three years. By using the "Five Views" method for market insights we identify opportunity lists detect new

technology trends in the industry and recognize technological shortcomings and potential risks. This enables the formulation of

actionable key tasks and corresponding countermeasures to ensure the effective implementation of the strategy.Cost Reduction Incentive Award 03

Risk Events Risk Analysis Response Measures

Encourages employees to propose technical improvement solutions to achieve cost reduction and efficiency enhancement. Evalua-

tion criteria cover structural optimization design changes low-cost alternatives material innovation production process innovation Global situation changes rapidly and Proactively deploy various new tech-

procedure improvements low material consumption energy efficiency and improved material utilization. The award categories Invest in enhanced R&D capabil-customer demands are continuously in- nologies identify new technical ad-

include Grand Prize First Prize Second Prize Third Prize and Wisdom Star Award. Recognition methods include monetary bonus ities to respond to new products creasing leading to a growing need for new vancements in the industry and make

and OA system announcements. swiftlyproducts sufficient preparations in advance

Anticipate customer demands for

Mozi Expert Allowance 04 As customers' systems continue to upgrade Design and develop innovative new products continuously enhance and expand the demand for new products products to meet customers' existing technologies and plan the

becomes more urgent diverse needs development of various products in

Promotes the development of a professional technical team under the Mozi Expert program enhances the capabilities of technical advance

engineers and motivates professional engineers to advance toward the Mozi Expert designation. The allowance is granted to depart-

ment heads of third-tier organizations and professional staff serving as Mozi Experts distributed quarterly in the form of a financial In response to the increasing business The company has invested in building Expand new production bases to

supplement along with their salary. demand the original production base in a state-of- the-art manufacturing facil-produce more and better prod-

Update and Optimization in Incentives for Scientific Research Projects Pudong Shanghai can no longer meet the ity super factory in Haiyan Jiaxing for ucts to meet customer demand

production needs of customer products production

Innovation Risk Management Table of LAZZEN

15 16About This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective Independent Key Feedback

Report the Chairman LAZZEN 2024 New Quality Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared

Guardianship of Assurance Performance Indicator and

Production Management Governance Vision Community Well-being Statement Table

Index Suggestions

CBB Common Technology LAZZEN Series Product

R&D Tools

Module Platform Intellectual Property Risk Assessment

Built the structural CBB module for Established a platform for the "Three-Break Under the Integrated Product Devel-

mechanisms arc extinguishing drawer One-Connect" product. The framework opment (IPD) process framework a

seats and accessories by sharing and product achieves intelligence optimized secondary development system was

Patent Risk Assessment Trademark Risk Assessment

reusing CBB (Common Building Blocks) soft connections and low power consump- integrated to establish an optimized

reduced redundant development efforts tion molded case products reduce power material library with over 800 items and

●?Regularly and automatically obtain newly published ●?Embed usage risk assessment into the evaluation pro-

and enhanced R&D efficiency. consumption miniature circuit breakers a technical requirements library with patents from key stakeholders and technical fields us- cess for new trademark applications alerting different

achieve low rotational inertia mechanisms 57 categories enabling quick access to ing patent search software. levels of responsible personnel based on varying risk

and contactor products ensure contact con- various knowledge bases for design im- levels. Subsequently we update the usage risk assess-

duction and operational reliability. proving R&D efficiency by 30%. ●?Conduct phased retrieval and evaluation of related

patents aligned with project development stages. ment conclusions and synchronize alerts according to

changes in the trademark application review progress

Status of Scientific Research Platform

conclusions and other relevant factors.Disclosure Item Unit 2024 Conduct Intellectual Property Early Warning and Risk Assessment

R&D Investment Amount RMB million 32469.74

R&D Investment as a Percentage of Business Revenue % 7.66

Number of R&D Personnel Number 594 During the reporting period

Proportion of R&D Personnel % 25.22

Intellectual Property LAZZEN conducted 8 intellectual property protection training sessions including 3 sessions specifically designed for

In 2024 LAZZEN enhanced and refined the intellectual property management frame- R&D personnel covering approximately 60 participants.work including the Intellectual Property Management Manual Intellectual Property

Management Procedure Intellectual Property Risk Management Procedure Intellec-

tual Property Reward and Punishment Measures and the Technical Innovation Award Disclosure Items Unit 2024

Selection System . Additionally new regulations such as the Intellectual Property

Compliance Management Measures the Intellectual Property Compliance Obligation Number of Invention Patents Applied to Major Business Number 348

Review Checklist and the Intellectual Property Compliance Obligation Review Report

form were introduced to further streamline and strength the intellectual property Number of Invention Patent Applications During the Report-

management. These measures effectively mitigate intellectual property risks and Number 127ing Period

encourage employees' innovation. To continuously enhance innovation quality and

foster a research atmosphere the Intellectual Property Department organized a Tech- Number of Invention Patents Granted During the Reporting

nical Innovation Award Selection and Technical Secret Review strengthening the Number 207Period

Company's core competitiveness.LAZZEN prioritizes intellectual property protection through competitive analysis Number of New Patents Granted During the Reporting Period Number 356

product analysis and patent monitoring to identify potential patent infringement Intellectual Property Compliance Manage-

risks conducting monthly active monitoring of trademarks and trade names along ment System Certification Number of Patents Held Number 1779

with establishing multiple channels for detecting potential infringement cases.Number of Copyrights Held Number 0

01020304

Enhance and optimize the In the previous version of the docu- Establish clear definitions Systematic Number of Trademarks and Registered Names Held Number 701

relevant regulations on intel- ment the management regulations for the classification of refinement

lectual property compliance for intellectual property such as trademark risk levels and to the evalua- Number of Software Copyrights Held Number 60

management and imple- trademarks and copyrights were their definitions corre- tion criteria

ment internal departmental mostly classified within the "other sponding warning levels for the Tech- Number of New Patents Filed Annually Number 456

self-inspections for intellec- intellectual property" category lack- implement detailed re- nological

tual property compliance ing necessary specificity. These have sponse strategy measures Innovation Number of New Copyrights Filed Annually Number 0

within the organization. been comprehensively articulated ac- and introduced formalized Award.cording to the system and company procedures for trademark

business requirements. usage risk assessment.

17 Intellectual Property Management Optimization Direction 18Digital-Intelligent Collective About This Message from About Honors in New Quality Climate Change and Building a Green

Supply Chain Sustainable Uniting Hearts Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Responsibility

Full Lifecycle

Service Compliance Toward a Shared

Guardianship of Assurance Performance Indicator and

Production Management Governance Vision Community Well-being Statement Table

Index Suggestions

Digital-Intelligent Ecosystem Cloud-Based Big Data Load Iden-tification Technology

Products By leveraging cloud-based big data this load identifi-

cation technology integrates local and cloud solutions.In the context of the national strategy encouraging enterprises to transform traditional industrial organization models through digi- With a recognition speed of mere seconds it can cover

tal intelligence LAZZEN has comprehensively promoted intelligent transformation through the "Dual Intelligence One Innovation" major household appliances and new device data

and "Dual Transformation One Value Chain" strategies. can be identified within two weeks. The technology

has been applied in areas such as Pudong District in

Shanghai and Baiyun District in Guangzhou successful-

ly identifying hazardous behaviors like electric vehicle

Intelligent Power Distribution home charging. The warning system links with relevant

management departments to provide technical support

With the energy transition and the liberalization of the power market the demand for intelligent power distribution will continue to for public safety.grow achieving more sophisticated automated and digitalized management. In terms of technological innovation the develop-

ment of technologies such as IoT cloud computing big data and AI provides expanded application scenarios and business model Application of Cloud-Based Big Data Load Identification Tech-

innovations. LAZZEN actively promotes R&D in the field of intelligent power distribution and has achieved remarkable results by nology

improving energy efficiency reducing energy waste and lowering carbon emissions contributing to the goal of a low-carbon soci-

ety. Additionally advancements in intelligent power distribution enhance the reliability and stability of the power system reduce

the risk of power outages and improve quality of life and production efficiency.Smart Living

Breakthroughs in R&D in the field of intelligent power distribution In 2024 LAZZEN introduced the "Comprehensive Household Power Management Solution" LAZZEN Magic Cube Tianqi Smart

Home Comprehensive Box and the "Carbon-Neutral Residence Home" Cloud Residence Platform. These innovations enable so-

phisticated automated control of household electricity and low-carbon operation of appliances. At the Haiyan factory smart living

Smart Power Distribution Hard- technology has been implemented across smart lighting smart shading and smart temperature control enhancing efficiency and

ware and Software Projects energy conservation.As a core technology project supporting LAZZEN's smart power distribution smart energy and safe electricity busi- LAZZEN independently developed the Cloud Residence Platform adopting a comprehensive cloud-native architecture that facil-

ness development this initiative facilitates the Company's transformation from a traditional low-voltage manufac- itates seamless third-party ecosystem product integration. The platform focuses on green low-carbon smart building scenarios

turer to a digital energy service provider. Smart Power Distribution Magic Link Power software and NEA series intelli- enables personalized business customization and allows versatile deployment. While ensuring information security it achieves

gent brand cabinet hardware products offer customers safe efficient and carbon-reducing smart energy solutions cost control and reliability. In 2024 multiple large-scale projects were successfully implemented the Open API was developed and

including smart power distribution smart energy carbon and safe electricity products. cloud-to-cloud integration with customer platforms was achieved.Automatic Device Recognition Tech- Green Smart Living

nology for Software System Gateway

By integrating smart devices and advanced algorithms smart

Through the development of an IoT gateway automatic device recognition module the gateway can automatically living achieves the goal of green buildings and carbon-neutral

recognize device types models and quantities upon startup and automatically register them to the IoT platform. homes. Through integration with photovoltaic storage systems

Once registration is completed the devices immediately begin data collection and reporting improving manual ef- to residential renewable energy sources smart devices collect

ficiency by 400%. data and optimize electricity consumption patterns to improve

green power utilization. Collaborating with Fudan University

on the Home Health Calendar and AI algorithms delivers the

best living experience with minimal energy consumption. It

Precision Load Forecasting offers three energy efficiency modes including free setting

Technology healthy comfort and low-carbon energy-saving helping users

precisely manage energy consumption for significant energy Green Smart Living

Using algorithm models tailored to various scenarios this technology enhances the efficiency of processing massive savings and environmental protection. By integrating ad-

data sets. It performs specialized modeling for holidays and non-holidays. The current model boasts an average vanced technology and intelligent management smart living

accuracy of over 91% and has already been implemented in the system. Load forecasting is fundamental to energy not only enhances residential comfort but also achieves sub-

planning economic operation and energy management. stantial energy-saving and environmental protection benefits.

19 20About This Message from About Honors in Digital-Intelligent

Collective

Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts Guardianship of Independent Key Indicator Feedback

Report the Chairman LAZZEN 2024 New Quality Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared Community Well- Assurance Performance and Production Management Governance Vision being Statement Table

Index Suggestions

Haiyan Smart Living Scientific Ethics

To systematically address scientific ethics risks LAZZEN ensures that all R&D activities and technology applications comply with

Enable remote zoned and timed shut- ethical standards. LAZZEN continuously monitors and adapts to the latest ethical standards laws and regulations and conducts

Lighting down of public area lighting to effectively

ethical assessments before project initiation. We maintain a high level of transparency promptly disclose R&D progress and ethical

manage energy consumption. review results and accept social supervision. This effectively prevents and addresses scientific ethics risks ensuring compliant

System healthy and sustainable development of technological R&D.We have achieved two significant outcomes in AI-related R&D AI-based waveform analysis and electrical lifespan prediction soft-

Leverage smart circuit breakers to facilitate ware and human pose estimation technology based on millimeter-wave and point cloud AI. The AI-based waveform analysis and

electricity metering provide high-power electrical lifespan prediction software aims to predict the remaining service life of contactors through real-time monitoring and

appliance alerts enable automatic pow- data analysis enhancing equipment safety and reliability while reducing maintenance costs. The millimeter-wave radar point

er-off when the room is unoccupied and cloud-based human pose recognition technology offers high privacy and precision in home application scenarios. Millimeter-wave Energy

trigger automatic power-on when occu- radar can detect patients' vital signs and activities with medical-grade accuracy without using cameras ensuring user privacy.Efficien-

pied. After the restaurant closes a one-

cy Sys-

click shutdown feature for smart circuit

tem breakers smart switches and air condi- Scientific Ethics Risks

tioning panels guarantees energy saving.Microwave radar technology as a physical principle (detecting objects through microwave signals) does not directly involve eth-

Haiyan Smart Living-Dormitory Construction Haiyan Factory Smart Living Design Blueprint ical issues. However its application may lead to a series of risks and challenges related to scientific ethics including privacy inva-

sion data misuse health risks environmental impact and social inequality. To avoid these ethical risks the research institute has

implemented a series of measures to ensure that the application of the technology does not harm individual rights or public inter-

ests promoting social equity and environmentally sustainable development.Guangzhou Energy-Saving and Low-Carbon Model Room Exhibition

Potential Issues Risk Type Risk Analysis Mitigation Measures

LAZZEN has established an energy-saving and low-carbon model room in Guangzhou to showcase its current strategic

achievements. By integrating the photovoltaic-energy storage-charging system and smart circuit breakers LAZZEN has Microwave radar can be used to monitor hu-Monitoring and

achieved intelligent management of the entire energy chain from production to consumption providing users with a man activities. If such technology is widely Privacy Inva-

more sustainable and intelligent living experience. In the power generation segment the model room is equipped with a deployed without control it may infringe on sion

photovoltaic-energy storage-charging system with 16 BIPV (Building Integrated Photovoltaic) panels installed on the roof. personal privacy

The energy efficiency management module displays real-time power generation metrics. On the consumption end smart

circuit breakers are used to accurately monitor the electricity usage of each circuit allowing customers to dynamically Privacy Issues If radar devices collect sensitive data (such

optimize their electricity usage patterns and achieve energy savings. as location behavior and health status) ●?Training academy organizes post-

strict compliance with data privacy regu- doctoral research personnel to

Data Collection

lations (GDPR) is required. Unauthorized consider ethical standards during

and Usage

collection storage or use of such data may the technology design and appli-

lead to ethical issues especially in cases of cation phases

data misuse or leakage ●?Implement transparent supervi-

sion and review measures

●?Strengthen data protection and

Microwave radar can detect human be- privacy safeguards

havior such as movement breathing and

Social and

heartbeat signals. If used for real-time track-

Misuse and Abuse Psychological

ing or large-scale surveillance it may have

Impact

profound social impacts and raise public

concerns about privacy and freedom

Whole-House Intelligent Control System BIPV Roof Photovoltaic Panel

Scientific Ethics Risks Analysis of the Microwave radar technology

21 22About This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective

New Quality Responsibility Compliance Toward a Shared Guardianship of

Independent Key Indicator Feedback

Report the Chairman LAZZEN 2024 Production Opportunities New Ecosystem Management Service Governance Vision Community Well-

Assurance Performance and

being Statement Table

Index Suggestions

Smart Future Factory Smart Factory

The LAZZEN Hangzhou Bay Super Factory is driven by industrial internet data introducing simulation technology and leveraging

LAZZEN is actively advancing its digital-intelligent transformation steadily strengthening the information-based R&D capabilities digital twin technology to build a platform that demonstrates the factory's production capacity achieving online and offline virtu-

striving to improve the process platform and adopting a data-driven operational model to continuously convert the achievements

of digital construction. We established the Digital Transformation Committee (DXMT) which possesses management capabilities in al-real synchronization enabling real-time remote monitoring

digital transformation planning investment project decision-making and architecture governance. The committee's specific re- of the production process in the Haiyan component workshop

sponsibilities have been clearly defined to promote integrated digital construction and drive the implementation of the Company's and realizing full transparency measurability and traceability

digital transformation. across the entire factory.In line with the digital transformation plan and project construction we developed the Digital Transformation Committee Operat- In smart production automated production lines are com-

ing Mechanism formulating a specific work plan for digital transformation each year and holding committee meetings for review. bined with cell lines achieving mass customization and quick

In 2024 LAZZEN updated the relevant protocols and procedures of the operating mechanism and redefined the classification and response to customer needs. By integrating 11 subsystems

grading standards for digital projects. in smart logistics on-time automatic material delivery is

achieved. Additionally through the collaboration of SRM

Digital Transformation (Supplier Relationship Management) QMS (Quality Manage-

Committee (DXMT) ment System) WMS (Warehouse Management System) MES

(Manufacturing Execution System) and TMS (Transportation

Management System) the agile supply chain is optimized

driving quality management and efficient collaboration across

Marketing R&D Supply Chain Operation Digital Technology the supply chain enhancing the factory's efficiency flexibility

and market responsiveness and supporting the Company's

business strategy development.Digital Transformation Committee (DXMT) Structure

0102030405

Demand Solution Procurement Project Imple- Acceptance

Review Review Review mentation Review

Digital Transformation Operational Mechanism

LAZZEN consistently upholds the vision of "Achieving Excellence in Low-Voltage Electrical Appliances and Building a New Smart

Electrical Ecosystem". We are committed to transforming the LAZZEN Hangzhou Bay Super Factory into a sustainable intelligent

and smart manufacturing park integrating green manufacturing intelligent manufacturing and smart manufacturing to establish

the largest intelligent manufacturing center in the low-voltage electrical appliance industry. Following the "Dual Intelligence One

Innovation" and "Dual Transformation One Value Chain" business strategy we continuously drive the digital-intelligent transfor-

mation of the Hangzhou Bay Super Factory through four key dimensions: smart and intelligent factories production logistics and

agile supply chain. The factory has implemented core advanced processes such as mold making injection molding stamping

welding electronics and electroplating along with a fully digital shared system covering the entire process from design quality

sales production to logistics propelling LAZZEN's high-quality development.Application Systems SAP PLM MES WMS etc.Data Platforms Mobile B1 Marketing Five Perspectives Product Line Operations Command Platform etc.Tool Software Solidworks Moldflow etc.Basic Maintenance Computers Hardware Servers Firewalls Penetration Testing Scope of Digital Twin Business — Haiyan Park Spot Welding Workshop Electronics Workshop Electroplating Workshop

Overview of LAZZEN's Digital Project Classification

23 24Digital-Intelligent Collective About This Message from About Honors in New Quality Climate Change and Building a Green

Supply Chain Sustainable Uniting Hearts Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Responsibility

Full Lifecycle

Service Compliance Toward a Shared

Guardianship of Indicator

Production Management Governance Vision Community Well-

Assurance Performance Index and

being Statement Table Suggestions

Function Module Function Remarks Intelligent Production

Quickly locate the current equipment by clicking on the

Manual Inspection device or production line and inspect using keyboard The finished product assembly workshop of LAZZEN's Hangzhou Bay Super Factory adopts a combination of automated produc-

operation tion lines and cell lines to achieve mass customization and rapid response. This approach ensures the efficiency of large-scale

production while accommodating the flexibility required for small-batch multi-variety products fully meeting customer demands.Set different roaming inspection routes for different needs In 2024 the factory completed the upgrade of the Industrial Control 311 lines Electromagnetic Leakage Prototype line Frame 728

Automatic Inspection such as visiting exhibition routes process inspection line and 4 Molded Case 211 lines. These projects resulted in significant improvements in line balancing and UPPH values.routes and key equipment quick inspection routes

Access and display data on energy sources such as water

Energy Data Access

electricity gas and heat Lean Production Line Upgrade

Access data from distribution boxes and cabinets and

Power Distribution Data Access

display power data for buildings floors and workshops During the reporting period the

Hangzhou Bay Super Factory ad-

Digital Inspection Monitor data on temperature humidity noise etc. and

Environmental Monitoring vanced the lean production line

trigger alarms when exceeding the set threshold upgrade based on product char-

Configure personnel information for automatic SMS alerts acteristics from the perspectives

SMS Notification

for faults and warnings of production lines workstations

and tooling. This effort further

Configure personnel information for automatic SMS alerts

Fault Alarm optimized the Electromagnetic

for faults and warnings Leakage Prototype line by reduc-

ing and eliminating 12 types of

Surveillance Management Integrated with electronic and electroplating cameras non-compliance with lean produc-

AI analysis in the electronics workshop to check for proper tion requirements such as ma-

Video AI Analysis

attire terial transfer inventory waiting

and heavy lifting. As a result the

Equipment Twin Animation Determined by the data status of on-site equipment production line adapted to mul-

Basic Equipment Information Manage the linkage between workshop production line ti-variety small-batch production Comparison of the Electromagnetic Leakage Prototype Line Before and After Lean Produc-

tion Line Optimization

Management and equipment enhancing production flexibility.Equipment Explosion Diagram Schematic diagram of equipment disassembly

Equipment Management View associated drawings and documents for the equip-

Drawing Upload and Viewing

ment

Detailed Equipment Information Continuously improve information on electronics and spot

Management welding materials

Scene Configuration DIY Scene Adjust the DIY scene when workshop equipment changes

Real-time display of AGV routes for electronics spot weld-

Warehouse Logistics Workshop AGV Logistics

ing and electroplating

Flexible report configuration displaying different types of

Operations Management Various Reports

reports for users with different permissions

Click on the relevant equipment in the layout diagram to

Equipment Layout Configuration jump to the scene location and display equipment details.Equipment Layout The layout diagram can be dynamically generated

Risk Four-Color Map Real-time view of floor plans safety channels and routes Prototype Line Improvement Team

Digital Twin Business Functions

25 26Collective

About This Message from About Honors in Digital-Intelligent New Quality Climate Change and Building a Green

Supply Chain Full Lifecycle Sustainable Uniting Hearts Responsibility Compliance Toward a Shared Guardianship of

Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Service Community Well- Assurance Performance

Indicator

Production Management Governance Vision Index

and

being Statement Table Suggestions

Smart Logistics

Workshop Logistics Distribution Electronic Display Boards

LAZZEN Hangzhou Bay Super Factory integrates 11 subsystems for automatic delivery from the automated warehouse to various

floors and workshops. By utilizing rail conveyor lines and AGVs materials are delivered to the designated workstations with precise During the reporting period LAZZEN addressed issues

timing creating an advanced logistics distribution system. The Company employs small packaging trains instead of manual hy- such as the lack of visual support for on-site-to-produc-

draulic carts and has launched the AGV project for cross-workshop finished product (frame) warehousing further enhancing logis- tion line delivery low delivery efficiency and difficulties

tics efficiency. in data integration. The company implemented visual

electronic display boards in each workshop focusing on

delivery achievement rates and making the delivery pro-

cess more transparent. This system allows managers to

monitor workshop delivery dynamics in real time achieve

vertical management across different levels and provide

long-term data support and improvements through dis-

play board data monitoring and statistics. Project-based Logistics Distribution Display Board

By utilizing project-based logistics distribution display boards delivery personnel are guided in their operations and

assisted in logistics information analysis. The displays core delivery indicators delivery efficiency metrics and logistics

distribution volumes. The system analyzes the data and pushes abnormal data alerts to the responsible personnel.Small packaging train delivery AGV POC testing

Agile Supply Chain

Through SRM QMS WMS MES and

TMS systems LAZZEN Hangzhou Bay During the reporting period

Super Factory advances quality man- The workshop QCD (Quality Cost Delivery) visual management board rotates to display content related to efficiency quality delivery

agement shares inventory and pro- and continuous improvement.The product quality The average The effective

duction data and achieves efficient up- PPM at LAZZEN Hang- product delivery production effi-

stream and downstream collaboration. zhou Bay Super Factory cycle was short- ciency per capita

In 2024 LAZZEN completed 10 digital decreased by ened by increased by Honors and Certifications

transformation projects including

two for quality advancement two for 15.3% 18.5% 20.8%

logistics inventory and delivery two for

production data sharing and four for

efficiency optimization.Quality For- Logistics Inventory Production Efficiency

warding and Distribution Data Sharing Optimization

2024 Zhejiang Provincial Future Factory Intelligent Manufacturing Capability

●?SRM System ●?VMI Material Vertical ●?Workshop Kanban ●?SMS Performance System Optimization

Maturity Certification

(Supplier Relation- Warehouse Management ●?System Calculation for ●?RPA Digital Employees (Robotic Process

ship Management (Vendor Managed Inven- Inbound Caliber Cost Price Automation)

System) tory) 2024 Jiaxing Green Factory 2024 Jiaxing High-Tech R&D Centerand Quantity Differences ●?Electronic Workshop MES Optimization

●?First Pass Yield ●?Development of Elec- (Manufacturing Execution System)

Alarm tronic Kanban for Haiyan

●?Long-Term Improvement Tracking and

Workshop Logistics 2024 Typical Case of Industrial Waste- 2024 Zhejiang Provincial Water-Saving Optimization for Equipment Anomalies

Distribution water Recycling Enterprisein EAM (Enterprise Asset Management)

LAZZEN's 2024 Supply Chain Digitalization Projects

LAZZEN Hangzhou Bay Super Factory 2024 Honors and Certifications

27 28Supporting of the UN SDGs

02

Climate Change and

Opportunities

Concept

LAZZEN actively responds to carbon peaking and carbon neutrality goals

and addresses climate change by continuously implementing energy-saving

and carbon reduction initiatives. We prioritize green and low-carbon devel-

opment as a long-term goal building a smart energy management platform

to optimize energy management systems and improve energy efficiency.Through strengthening green ecological technology R&D and introducing

new equipment we expedite the green transformation and expands into the

new energy market providing customers with comprehensive low-carbon

solutions and establishing a smart electrical zero-carbon ecosystem.Our Actions

●?Addressing Cli- ●?Energy ●?Clean Technolo-

mate Change Management gy Opportunities

Key Performance

Total greenhouse gas emissions: 19841.75 tCO2e

Clean energy consumption: 4705.14 MWhAbout This Message from About Honors in Digital-Intelligent Climate Change Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective Independent Key Feedback

Report the Chairman LAZZEN 2024 New Quality and Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared

Guardianship of Indicator

Production Management Governance Vision Community Well-

Assurance Performance Index and

being Statement Table Suggestions

Addressing Climate Change Climate Change Risk Management

LAZZEN proactively tracks climate change and actively responds to the carbon peaking and carbon neutrality goals emphasizing In alignment with China's carbon peaking and carbon neutrality strategic objectives LAZZEN has adopted a proactive approach

the capability to address climate changes and drive green and low-carbon transformation. We follow the International Sustainabil- to systematically identify evaluate and manage climate-related risks and opportunities. LAZZEN has categorized different risk

ity Standards Board's (ISSB) "IFRS S2 - Climate-related Disclosures framework to analyze and manage climate change issues con- types and developed corresponding countermeasures based on the impacts of climate change to better address these challeng-

tinuously enhancing its climate change management structure and enhancing its response capacity es.During the reporting period LAZZEN completed carbon inventory and verification for the 2023 baseline year and initiated the 2024

carbon inventory project to refine emission data for subsequent management. By 2025 LAZZEN plans to launch a zero-carbon fac-

Climate Change Governance tory initiative continuing its focus on carbon reduction and further enhancing sustainable development capabilities.LAZZEN has established a clear allocation of responsibilities for each organizational level under the Sustainable Development Risk Type Risk Description and Impact Analysis Mitigation Measures

Committee framework progressively refining production processes and equipment advancing carbon emissions management Extreme weather events (e.g. heavy rain Establish a regular meteorological information

and reducing carbon emissions to holistically implement climate change governance. typhoons snowstorms floods and high tracking mechanism and develop emergency

temperatures) can lead to production inter- response plans for extreme weather and sud-

Acute Risk

ruptions depreciation of fixed assets labor den environmental events; introduce a digital

Physical loss and increased facility maintenance costs platform for real-time monitoring to provide

Risk impacting product delivery early warnings of safety hazards

Global warming affects production processes Develop a climate change emergency re-

Chronic

logistics and office operations leading to sponse plan continuously monitor climate

Risk

increased operating costs change trends and provide early warnings

Improve the carbon emissions and product

carbon footprint management system set

Increasing government requirements for

climate change management targets contin-

climate-related information disclosure put

uously optimize the energy structure and en-

pressure on compliance management; carbon

Policy and ergy-saving measures and strengthen green

Director of the Sustainable Members of the Sustainable Departments and emissions from production and operations Legal Risk and low-carbon technology research and

Development Committee Development Committee Subsidiaries need stricter control and overseas business development; monitor domestic and interna-

faces increased pressure from greenhouse gas

tional greenhouse gas emission regulations to

●?Supervise and manage climate ●?Responsible for the manage- ●?Drive the implementation of regulations respond to new laws and regulatory require-

change-related initiatives ment and deployment of tasks climate change management ments in a timely manner

corresponding to ESG issues. measures in accordance with

●?Monitor the climate risks and the climate change strategy. The risk of failure when introducing ener- Continuously improve equipment efficiency Techno-

opportunities and formulate gy-saving equipment or clean technologies focus on low-carbon areas conduct research logical

corresponding management and promoting low-carbon technology in green and low-carbon directions and

measures. Transition

Risk

research to achieve carbon reduction establish fault tolerance mechanisms

Risk

Capital markets customers and other stake-

Climate Change Governance Committee Structure and Responsibilities Monitor changes in carbon market policies holders are increasingly concerned about the

proactively invest in green technology re-

Market company's carbon reduction actions seeking

search and development and implement

Risk green low-carbon solutions and requiring a

green supply chain initiatives to meet custom-

Climate Change Strategy green supply chain which can impact the er and market demandscompany's market share

LAZZEN remains committed to the green development philosophy adopting the gradual reduction of carbon emission intensity as Stakeholders such as customers are in- Continuously advance the green and low-car-

its long-term strategic direction. LAZZEN is dedicated to optimizing the energy structure by increasing the proportion of clean ener- creasingly concerned about the company's bon development path optimize the com-

gy in total energy consumption phasing down fossil fuel usage and maximizing renewable energy adoption. Additionally through performance in addressing climate change. pany's environmental management system Reputa-

technological upgrades and equipment retrofitting the Company aims to enhance energy efficiency and reduce operational car- Failure to take proactive action may result in enhance climate change response capabili-tion Risk

bon emissions. Future initiatives include advancing zero-carbon factory projects and conducting carbon neutrality forecasting to non-compliance with local regulations and ties strengthen negative public opinion mon-

address climate change challenges. stakeholder expectations damaging the com- itoring and actively address and rectify issues

pany's image and reputation to reduce negative environmental impacts

Identification and Countermeasures for Climate Change-Related Risks at LAZZEN

31 32Collective

About This Message from About Honors in Digital-Intelligent New Quality Climate Change Building a Green

Supply Chain Full Lifecycle Sustainable Uniting Hearts Responsibility Compliance Toward a Shared Guardianship of

Independent Key Feedback

Report the Chairman LAZZEN 2024 and Opportunities New Ecosystem Service Community Well- Assurance Performance

Indicator

Production Management Governance Vision Statement Table Index

and

being Suggestions

Climate Change Indicators and Targets Greenhouse Gas Reduction

LAZZEN actively engages in carbon inventory and verification work and sets corresponding climate change targets in line with the LAZZEN has implemented various carbon emission reduction management measures including energy-saving diagnostics tech-

national goals of "Carbon Peak by 2030" and "Carbon Neutrality by 2060". nological innovation motor replacement and photovoltaic power station construction. LAZZEN also conducted efficiency testing

and evaluation on key energy-consuming equipment to further achieve energy-saving and emission reduction management goals.Year Climate Change Target Description

●?Conduct carbon emission data inventory and verification work LAZZEN Supports the Construction of the Largest Single-Unit Desert Photovoltaic

2024

●?Establish a Sustainable Development Committee to address climate change Power Station in China

●?Disclose the LAZZEN Carbon Neutrality White Paper

2025 During the reporting period Chi-

●?Set carbon neutrality targets na's largest desert photovoltaic

Respond to the national "Carbon Peak" goal with a gradual reduction in corporate carbon power station the Xinjiang Green ●?

2030

emissions year by year Development Midong Distr ict

3.5GW Photovoltaic Project was

●?Respond to the national "Carbon Neutrality" goal achieving a balance between carbon emis- successfully connected to the grid.

2060

sions and absorption The project is located in the Dong-

dao Haizi Desert Wetland area

covering approximately 200000

acres.LAZZEN provided core elec-

trical protection solutions for the

project including the NDWPG-

4000HU frame circuit breaker and

the NDM3A-320VH molded case cir-

cuit breaker. These products were

applied to the low-voltage cabinets

of the booster transformer substa-

tion serving the photovoltaic grid

connection protection function.The total installed capacity of the

project reaches 3.5 million kilo-

watts with an annual utilization of

1740 hours providing 6.09 billion

kWh of clean electricity annually.This helps save 1.9488 million tons

of raw coal and reduces carbon

dioxide emissions by 6.0717 million

Greenhouse Gas Verification Certification tons per year. The project plays a

significant role in supporting the

national carbon peaking and car-

bon neutrality strategy accelerating

During the reporting period LAZZEN and Liangxin Electric Appliances (Haiyan) Co. Ltd. conducted a carbon inventory. local energy structure optimization

and promoting the development of

Disclosure Item Unit 2023 2024 the electricity market.Xinjiang Green Development Midong District 3.5GW PV Project

Total Greenhouse Gas Emissions tCO2e 22127.02 19841.75

Scope 1 Greenhouse Gas Emissions tCO2e 712.38 1125.37

Scope 2 Greenhouse Gas Emissions tCO2e 21414.64 18716.38

33 34Collective

About This Message from About Honors in Digital-Intelligent Supply Chain New Quality Climate Change Building a Green Responsibility Full Lifecycle

Sustainable Uniting Hearts Guardianship of Independent Key Indicator Feedback

Report the Chairman LAZZEN 2024 Production and Opportunities New Ecosystem Management Service

Compliance Toward a Shared Community Well- Assurance Performance and Governance Vision Indexbeing Statement Table Suggestions

"First-Class Energy-Efficient Compressed Air Station" Energy Management

The compressed air system is equipped with variable-frequency energy-saving air compressors each paired with a The types of energy consumed in LAZZEN's production mainly include electricity natural gas steam and tap water with electricity

waste heat recovery unit and energy-saving adsorption dryers. Additionally PLC technology is used for group control of and steam being the primary energy sources. The company adheres to the Energy Conservation Law the Energy Law the Shanghai

all equipment in the compressor room along with various energy-saving measures and devices. The system has been Energy Conservation Regulations and other relevant laws and regulations to implement energy management. LAZZEN continu-

awarded the title of "First-Class Energy-Efficient Compressed Air Station" by the Shanghai Institute of Quality Inspection ously optimizes its energy management system by introducing new energy equipment and promoting energy-saving and emission

and Technical Research Institute. reduction measures to enhance energy management efficiency.Energy Governance

LAZZEN adopts a hierarchical energy management approach

and has established and implemented an energy management

framework including the Energy Management Manual and

Energy Risk Management Measures. The Company has formed

an energy management team and developed an energy audit

management framework and an energy measurement man-

agement framework. LAZZEN has successfully obtained ISO

50001 Energy Management System certification.

Energy Efficiency Certification Plaque for the Compressed Air Station Compressor Room

ISO 50001 Energy Management System Certification

Product Carbon Footprint Energy Management Strategy

LAZZEN conducts full lifecycle management for its products. To further address climate change and build a green supply chain LAZZEN adheres to the mission and vision of "Excelling in Low-Voltage Electrical Appliances and Building a Smart Electrical Ze-

while enhancing the competitiveness in low-carbon and green products LAZZEN will pursue carbon footprint certification for the ro-Carbon Ecosystem". We follow the energy management policy of "Customer-Oriented Quality-Based Scientific Innovation

NDB2-63 Miniature Circuit Breaker. The certification preparation work is expected to be completed by 2025. Energy Conservation and Environmental Protection Safety and Efficiency Legal Compliance Scientific Management Continuous

Improvement". To enhance energy management efficiency we actively conduct energy audits. During the reporting period LAZ-

ZEN analyzed energy usage identified the energy efficiency level and pinpointed issues and weaknesses in energy management

and utilization. Through on-site testing and diagnostics we identified energy-saving potential and proposed practical energy-sav-

ing measures and recommendations. This approach strengthens the Company's energy management capabilities reduces energy

consumption costs improves economic benefits and promotes sustainable economic and environmental development.Additionally the energy management team holds regular energy management meetings to analyze the impact of disposal pro-

cesses and equipment operations on the comprehensive energy consumption of unit products. Relevant departments establish a

key energy-consuming equipment ledger based on equipment model power operating time and loss conditions and implement

effective monitoring. During the reporting period LAZZEN developed energy-saving and consumption reduction plans for key

energy systems primarily focusing on power distribution systems compressed air systems air conditioning systems and certain

NDB2-63 Miniature Circuit Breaker with production equipment.short circuit protection isolation func-

tion and overload protection

Energy Impact and Risk Management

To ensure stable energy supply price stability sustainable development and the smooth operation of the energy sector LAZZEN

has established management systems such as the Energy Risk Management Measures and the Risk and Opportunity Management

Procedures in compliance with the Energy Conservation Law and other relevant regulations. By implementing energy-saving and

carbon reduction measures LAZZEN strengthens its ability to manage energy-related risks. The Company regularly conducts ener-

gy monitoring and analysis allocates energy quotas and adjusts production plans and scheduling in real-time to further enhance

its energy management risk resistance.

35 36About This Message from About Honors in Digital-Intelligent Climate Change Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective Independent Key Feedback

Report the Chairman LAZZEN 2024 New Quality and Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared

Guardianship of Assurance Performance Indicator and

Production Management Governance Vision Community Well- Indexbeing Statement Table Suggestions

To enhance energy efficiency and promote transparency in energy management LAZZEN has implemented an Intelligent Power

Energy Usage Monitoring and Regulation Energy Saving and Alternative Energy Utilization Distribution Platform System and established a Smart Energy Management Platform. This system leverages industrial internet

1Real-Time Monitoring and Analysis 1. Exploring Energy-Saving Potential technology and integrates with smart parks digital twins and Manufacturing Execution Systems (MES). The platform features data

Deployed the real-time energy consumption tracking Adjust the operating parameters of production equip- measurement operations management energy consumption analysis energy usage visualization and system configuration. Us-

module of the energy management system(EMS) to ment to reduce energy consumption. Inspect and re- ing a layered and distributed system architecture it enables real-time data collection from various energy consumption units with-

closely track energy consumption and usage data. pair potential energy leakage points within the facility in the facility. In case of abnormalities the system triggers alerts and cumulative data is analyzed to provide data-driven support

Designated certified personnel to regularly inspect to minimize energy loss. for energy-saving and consumption reduction initiatives.energy metering instruments and report any abnor- 2. Utilizing Alternative Energy Sources During the reporting period the installation rate of primary secondary tertiary and quaternary metering meters in the power dis-

malities promptly. Under the premise of safety and environmental com- tribution system reached 98%.With the Air Conditioning Intelligent Control System total air conditioning electricity consumption in

2. Energy Quota Allocation pliance promptly activate alternative energy equip- Q3 2024 decreased by 16% compared to Q3 2023.

Develop a dynamic energy quota allocation plan ment to fill energy gaps. For processes that can utilize

based on the importance of each workshop produc- alternative energy conduct temporary energy conver-

tion line and urgent orders. Establish a supervision sion.mechanism for energy quota usage.

3. Production Planning and Scheduling Adjustments

Collaborate with the planning and manufacturing de-

partments to flexibly adjust production plans based

on the severity and duration of energy shortages.Smart Energy Management and Energy Storage Management Intelligent Air Conditioning Control System

Energy Management Indicators and Targets

LAZZEN

Energy

Emergency 2024 Energy Management Target Achievement

Management

Company's energy target: 0.0189 tce per 10000 RMB Achieved

Measures

Disclosure Item Unit 2022 2023 2024

Total Energy Consump- Tons of Standard

-3091.863743.39

tion Coal

External Communication and Coordination Emergency Support and Risk Prevention Natural Gas m3 46217 53267.1 47831.00

1.Communication with Energy Suppliers 1. Ensuring Key Equipment Operation Steam m3 1163.03 2234 2272.82

Negotiate for priority restoration or an increase in Form a cross-functional maintenance team to inspect

energy supply to the factory. Discuss the possibility of energy equipment critical to safe production and Electricity MWh 33223.41 39710.90 33621.47

obtaining additional energy resources. key processes. Prevent equipment failures that could

2. Reporting and Seeking Assistance from Relevant worsen energy shortages or cause safety incidents. Direct Energy Con- Tons of Standard - 20.00 63.62

Authorities Equip key equipment with backup power sources. sumption Coal

Establish direct communication channels with local 2.Risk Prevention and Emergency Drills Indirect Energy Con- Tons of Standard

economic and information technology committees to Develop corresponding risk prevention measures for - 3071.86 3679.77sumption Coal

ensure energy supply for the factory. various safety risks. Strengthen on-site safety man-

agement and monitoring. Regularly conduct emer- Tons of Standard Energy Consumption

gency drills for energy shortages. Coal per Unit of - 0.0189 0.0129Intensity

Production

Clean Energy Usage MWh 1688.60 3353.94 4705.14

37 38About This Message from About Honors in Digital-Intelligent Climate Change Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective Independent Key Feedback

Report the Chairman LAZZEN 2024 New Quality and Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared

Guardianship of Assurance Performance Indicator and

Production Management Governance Vision Community Well-being Statement Table

Index Suggestions

Clean Technology Opportunities Opportunities in New Energy Products

The global energy revolution is accelerating with clean energy and smart grids emerging as key directions for future energy devel-

LAZZEN continues to accelerate its green transformation by strengthening green ecological technology R&D expanding into the opment. Guided by the "carbon peaking and carbon neutrality" goals LAZZEN continuously evaluates its innovation capabilities

new energy market and providing customers with high-efficiency energy-saving products and low-carbon solutions thereby in clean technology and explores development opportunities. The Company is expanding its presence in the new energy market

building a smart electrical zero-carbon ecosystem. developing green energy-efficient and high-performance products as well as low-carbon solutions thereby driving its green and

low-carbon transformation. LAZZEN remains committed to providing customers worldwide with advanced and reliable smart elec-

trical solutions collectively building a clean low-carbon safe and efficient future energy system.Green Ecological Technology In new energy research and development the Company adheres to the principle of "saturating resource investment and ensuring

a 25-year product lifespan" as its core philosophy. Focusing on key innovation areas in new energy product development LAZ-

The green innovation research covers various aspects including materials structure and performance. The Company optimizes ZEN prioritizes customized product development streamlines R&D processes by emphasizing key aspects and ensures reliability

high-energy-consuming processes and energy-saving algorithms through new processes new technologies new equipment and through large-sample testing. During the new product development process the Company deeply integrates into customer usage

new energy solutions. Green ecological design principles are integrated into product development and life cycle assessments are scenarios maintaining close collaboration with clients to identify and resolve issues early ensuring that new products are ready for

conducted to optimize lightweight and low-carbon solutions. As a result LAZZEN's products have been recognized by the Ministry mass adoption upon market launch.of Industry and Information Technology as "Green Design Products". Currently LAZZEN's innovation in the new energy market revolves around two key aspects: optimizing power and functionality and

LAZZEN has established a green manufacturing management system team responsible for improving equipment energy efficiency enhancing product configuration combinations.and developing photovoltaic projects while implementing clean production concepts. The Company prioritizes the use of non-tox-

ic and low-toxicity raw materials and replaces oil-based paints with water-based paints for circuit board corrosion protection sig- New Energy Application Picture

nificantly reducing VOCs xylene and acetone emissions. To further enhance clean production LAZZEN has developed the Clean- Industry Scenarios

room Usage Specification management document adopted clean production processes and selected advanced environmental

protection equipment to prevent fugitive emissions of welding fumes. Additionally traditional oil-based ink printing machines

have been replaced with laser printers significantly reducing the pollutants generated in the printing process.As a result of these efforts LAZZEN has been awarded the "National Green Factory" demonstration title.Onshore Wind Power

Product Name Product Picture Technical Innovations Wind Offshore Wind Power

Power

Designed with a front-mounted panel

NDW2X-1600 Frame Circuit structure and an optimized internal

Breaker structure reducing product size by Ground-based Power

18%. Station: Centralized

String-type

Photovol- Commercial and Indus-

taics trial PV

Residential PV

The contact support uses high-tem-

perature-resistant and eco-friendly

materials to replace non-recyclable

NDC3Z Contactor

materials which is expected to reduce Large-scale Energy Stor-

non-recyclable material usage by 2280 age

kg annually. Commercial and Indus-

Energy trial Energy Storage

Storage Residential Energy Stor-

age

Green Environmental Technology Progress and Achievements (Partly)

39 40About This Message from About Honors in Digital-Intelligent Climate Change Building a Green Supply Chain Sustainable Uniting Hearts

Collective Independent Key Feedback

Report the Chairman LAZZEN 2024 New Quality and Opportunities New Ecosystem Responsibility

Full Lifecycle

Service Compliance Toward a Shared

Guardianship of

Community Well- Assurance Performance

Indicator and

Production Management Governance Vision Indexbeing Statement Table Suggestions

LAZZEN Supports the Zero-Carbon Journey with Photovoltaic and Energy Storage

Electrical System Solutions

Nuclear Island

Conventional Island During the reporting period LAZZEN participated in the 17th International Solar and Smart Energy Exhibition. In recent

Nuclear

Auxiliary System years LAZZEN has secured over 40% of the low-voltage electrical appliance market share in the new energy segment

Power

contributing to the shipment of more than 200GW of new energy power generation equipment. This effort further ad-

vances industry technology and supports the achievement of carbon neutrality goals. For centralized photovoltaic (PV)

applications the Company has developed a 3.125MW large-unit solution and a 1+X modular small-unit solution. In string

PV systems LAZZEN has introduced highly efficient reliable and stable product solutions.In distributed PV applications LAZZEN has launched a live-line reclosing circuit breaker solution a self-reset overvoltage

and undervoltage protection solution and an intelligent distribution area solution. For commercial and industrial PV de-

mands the Company has introduced grid-connected protection cabinet solutions for 50–400kW and 500kW–1MW appli-

AC Charging Pile cations effectively meeting market needs.DC Charging Pile

Charging Supercharging Pile

Stations Battery Swap Station

Commercial Vehicle

Commercial Vehicle

Electric Forklift LAZZEN participated in the 17th International Solar and Smart Energy Exhibition

Vehicles

Inland River Vessel

Sea-going Vessel

Electric Unmanned Electric Vessel

Ships

Green Hydrogen

Hydrogen

Energy

The 4th-generation commercial nuclear power plant - Shandong Shidaowan Guohe Pressurized Water Reactor Demonstration Project with an in-

stalled capacity of 3000MW and a total investment of RMB 42.3 billion. LAZZEN provided two-stage and three-stage DC miniature circuit breakers and

LAZZEN's 2024 New Energy Product Deployment molded case circuit breakers which were applied in booster stations desalinated water systems circulating pump rooms and other systems.

41 42Supporting of the UN SDGs

03

Building a Green New

Ecosystem

Concept

LAZZEN prioritizes environmental compliance management actively as-

sumes primary responsibility for ecological and environmental protection

and thoroughly implements resource control strategies. The company en-

hances water conservation measures promotes green packaging and circular

economy models and ensures the lawful and compliant treatment of emis-

sions and waste. LAZZEN continuously optimizes wastewater exhaust gas

noise and waste treatment processes while strengthening the supervision

and control of hazardous chemicals comprehensively improving its environ-

mental compliance management efficiency.Our Actions

●?Environmental Com- ●?Resource ●?Pollutant

pliance Management Management Emissions

●?Waste ●?Chemical

Disposal Management

Key Performance

Total environmental protection investment: RMB : 1.7 million

No major administrative penalties imposed by ecological and environmental

authorities due to environmental incidents

Non-hazardous waste disposal: 70.56 tons with a 100% recy-

cling rateCollective

About This Message from About Honors in Digital-Intelligent New Quality Climate Change and Building a Green

Supply Chain Sustainable Uniting Hearts Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Responsibility

Full Lifecycle

Service Compliance Toward a Shared

Guardianship of Assurance Performance Indicator and

Production Management Governance Vision Community Well-being Statement Table

Index Suggestions

ronmental risk assessment tools and methodologies to quantify each compliance risk point. LAZZEN evaluates the likelihood of

Environmental Compliance Man- occurrence potential impact possible environmental incident types and severity of consequences to determine key priorities for

environmental management and develop appropriate countermeasures.agement LAZZEN has established an environmental compliance emergency management framework based on the Emergency Response

Plan for Sudden Environmental Incidents and related policies. An emergency rescue organization has been formed and the Com-

pany has implemented environmental risk prevention and emergency response measures including regular inspections main-

LAZZEN strictly complies with national environmental protection laws and regulations such as the Environmental Protection Law tenance responsibility systems and compliance with environmental risk control requirements outlined in project environmental

and the Environmental Impact Assessment Law. LAZZEN continuously refines the environmental management framework and impact assessments. Additionally LAZZEN conducts at least two environmental risk and emergency management awareness and

organizational structure clearly defining environmental management responsibilities at all levels to enhance environmental com- training sessions for employees each year along with emergency drills for sudden environmental incidents to enhance prepared-

pliance capabilities. ness and response capabilities.Environmental Compliance Governance ●?Regulatory Policy Review: Annually review and interpret newly issued or revised environmental

laws regulations and policy standards at the national and local levels focusing on changes that

Upholding the principle of environmental protection LAZZEN has established a series of may significantly impact the company's production and operations.internal environmental management documents including the Environmental Occupa- ●?Preliminary Risk Identification: Based on the company's business scope and operational model

tional Health and Safety Management System the Environmental Factor Identification and Legal Review identify potential environmental risk areas from a legal compliance perspective and compile a list

Assessment Management Procedure the Resource and Energy Management Procedure of potential risk points as the basis for further in-depth assessment.the Wastewater Discharge Management Procedure the Exhaust Gas Emission Management

Procedure and the Emergency Preparedness and Response Management Procedure. These

documents form the foundation of the environmental management framework in 2024

LAZZEN revised its environmental management framework documents updating primary

responsible departments adjusting applicable scopes modifying specific departmental ●?The EHS department conducts a quantitative evaluation of each risk point determining the like-

responsibilities and incorporating relevant local standards.EHS Identi- lihood of occurrence potential impact level possible types of environmental incidents and the

ISO 14001 Environmental Management

Currently LAZZEN is certified under the ISO 14001 Environmental Management Framework. Framework Certification fication and

severity of consequences.Assessment

Environmental Compliance Strategy

●? Cross-Departmental Communication and Collaboration: The EHS department communicates the

risk assessment results and response plans to all relevant internal departments through detailed

LAZZEN fully implements ecological and environmental protection initiatives adhering to the "energy-saving and environmentally briefings and training sessions. It also organizes cross-departmental meetings to facilitate joint

friendly" compliance management policy. The Company continuously adopts new processes technologies and equipment to up-

Internal Coor- participation in environmental risk management.grade or replace high-energy-consuming industrial equipment prioritizing energy-efficient and low-consumption products equip-

ment and services to achieve energy conservation and resource optimization. LAZZEN designs and manufactures HSF (Hazardous dination and ●?Integration into Daily Operations: The results of environmental risk assessments and correspond-

Substance-Free) products actively promoting HSF environmental concepts within its supply chain. LAZZEN continually enhances Communica- ing mitigation measures are integrated into the company's daily operations. This includes strate-

the environmental performance of its products strategically planning and executing its environmental compliance management tion gic planning production scheduling procurement decisions and performance evaluations with

framework to strengthen overall environmental governance efficiency. specific risk control indicators and operational procedures established accordingly.Environmental Compliance Risk Management Environmental Compliance Risk Assessment

To address environmental compliance risks LAZZEN has developed several policy documents including the Emergency Response Comprehensive Emergency Response Plan for Work Safety Accidents of

Plan for Sudden Environmental Incidents the Emergency Preparedness and Response Management Procedure the Incident Inves- LAZZEN & Liangxin Electric Appliances (Haiyan) Co. Ltd.tigation and Handling Management Procedure the Risk and Opportunity Management Procedure and the Company Environmental

Analysis Management Procedure. In 2024 LAZZEN updated the Hazard Identification Management Procedure adding risk assess-

ment methodologies and refining its descriptions. The Emergency Preparedness and Response Management Procedure was also

revised to include additional types of natural disasters and changes in regulatory authority names.LAZZEN has established an emergency response team (ERT) led by the EHS Safety Committee. This team consists of department

heads or designated personnel from various departments. Each department regularly fills out and submits the Risk and Opportuni-

ty Identification and Assessment Form while third-party organizations conduct environmental assessments and provide reports to Special Emergency Response Plan Special Emergency Response Special Emergency Response Plan for

continuously optimize environmental compliance and resource management processes. for Sudden Safety Accidents Plan for Fire Accidents Typhoon Flood and Natural Disasters

To ensure legal and regulatory compliance LAZZEN regularly conducts environmental risk assessments using professional envi- Emergency Response Plan System

45 46Digital-Intelligent Collective About This Message from About Honors in New Quality Climate Change and Building a Green

Supply Chain Sustainable Uniting Hearts Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Responsibility

Full Lifecycle

Service Compliance Toward a Shared

Guardianship of Assurance Performance Indicator and

Production Management Governance Vision Community Well-being Statement Table

Index Suggestions

Type of Environ- Specific Environmental

Environmental Impact and Risk Response During the reporting period

mental Incident Incident

●?Exceeding sewage discharge If an accident occurs at the factory's sewage treatment station

standards wastewater may be discharged directly into Jiaxing United Sew- The total environmental investment amounted to RMB million. LAZZEN incurred no major administrative penal-

●?

Water Pollution Sewage pipeline leakage causing age Treatment Co. Ltd. without proper treatment. The wastewa-

1.7

river pollution ter may contain excessive levels of CODc ammonia nitrogen and

Emergency Incident River accidents heavy metals exceeding the sewage plant's intake standards ties from environmental authorities due to environmental incidents with a total penalty amount of RMB .●? 0

●? Large-scale leakage of the sew- potentially impacting Jiaxing United Sewage Treatment Co. Ltd.'s

age system water quality

If operations are not halted and repairs are not conducted A total of 2355 employees received environmental training. The total training duration was 24 hours.Air Pollution Emer- ●? Fan failure promptly exhaust gas concentrations could increase multiple

times potentially causing poisoning and affecting downwind

gency Incident ●?Terminal treatment device failure areas at a considerable distance. Relevant equipment should be

replaced in time to prevent malfunctions

●? Leakage during the transfer of

hazardous substances or solid If a solid waste leakage occurs within the factory premises emer-

Soil Pollution Emer- waste gency measures such as closing the rainwater discharge valve

Green Operations

Leakage during the storage of opening the emergency pool and using emergency materials like gency Incident ●?

hazardous substances or solid sand and cotton cloth can be implemented to contain the impact LAZZEN advocates for green operations and promotes a low-carbon lifestyle consistently implementing ecological and environmen-

waste within the factory area tal protection principles in its production and business activities. In the production process LAZZEN utilizes advanced Italian fully

Based on long-term meteorological data from the company's and automated miniature circuit breaker assembly lines and Asia's third largest automated silver electroplating production line reducing

Natural Disasters the park's location the most likely extreme weather conditions in the generation and hazardous impact of industrial solid waste while establishing a "dark factory" model to achieve energy conser-

Extreme Weather or ●?Natural disasters the area are high temperatures and strong winds. During extreme vation and consumption reduction. For green office practices we encourage employees to implement environmental measures by

Adverse Meteorolog- ●?Extreme weather high-temperature conditions LAZZEN implements preventive promoting paperless operations. Meeting notifications schedule management expense reimbursements and other processes are

ical Conditions measures against high temperatures and strong winds to mitigate all completed through the OA electronic system further reducing environmental impact and contributing to ecological protection.environmental risks Additionally we actively organize environmental training and activities along with routine environmental awareness campaigns to

Risk Analysis for Environmental Incidents strengthen employees' sense of responsibility for environmental protection."Zero-Waste City" Environmental Awareness Campaign

During the reporting period LAZZEN organized an environ-

mental awareness campaign themed "Zero-Waste City" for

its employees. The event introduced the origins and devel-

opment of "Zero-Waste Cities" and "Zero-Waste Factories"

helping employees recognize their role as both participants Energy-Saving Production Area – Fully Automated Silver Electroplating Paperless Office with Electronic OA System

and beneficiaries of zero-waste factory development. We Production Line Establishing a "Dark Factory" Model

emphasized the importance and necessity of adhering to

circular economy principles and green development in

production and operations fostering the construction of a

sustainable and eco-friendly environment. Environmental Awareness Campaign

Environmental Compliance Indicators and

Zero-Waste Factory Awareness Campaign

Targets

Biodiversity

No. 2024 Environmental Compliance Indicators and Targets Achievement Status

1 Hazardous waste environmentally compliant disposal ≥ 1 time Achieved During the preliminary phase of Hangzhou Bay Super Factory construction the regional ecological environment was assessed as

Production exhaust emissions (hydrogen cyanide sulfuric acid mist) non-sensitive classifying it as a general area. LAZZEN strictly adheres to the Regulations on the Protection of Wild Plants and other

2 Achieved

comply with GB21900-2008 standards environmental laws and regulations advocating employee awareness of environmental protection. LAZZEN actively conducts envi-

3 Fire hazards ≤ 1 incident Achieved ronmental awareness campaigns and strictly follows internal environmental compliance management policies throughout its pro-

4 Chemical leakage incidents ≤ 1 incident Achieved duction and operations minimizing negative impacts on biodiversity and the environment.

47 LAZZEN 2024 Environmental Compliance Indicators Targets and Achievement Status 48About This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective

New Quality Responsibility Compliance Toward a Shared Guardianship of

Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Service Community Well- Assurance Performance

Indicator and

Production Management Governance Vision being Statement Table

Index Suggestions

Resource Management Water Resource Management Strategy

LAZZEN strictly adheres to the national policies of resource conservation and environmental protection striving to establish an envi-

ronmentally friendly and green enterprise. By implementing the principles of cleaner production and circular economy LAZZEN fully

LAZZEN continuously optimizes its resource management system emphasizing the protection and efficient use of water resources. promotes the creation of a water-saving enterprise advancing towards sustainable development.LAZZEN implements various water conservation measures prioritizes the use of eco-friendly packaging materials and promotes

resource recycling initiatives to enhance overall resource utilization efficiency.Water Resource Risk Management

Water Resources LAZZEN conducts water resource risk assessments and management to prevent water wastage and potential environmental im-

pacts. To enhance water conservation management LAZZEN has formulated various regulations including the Annual Water

Conservation Work Plan Water Usage Statistics System Regular Maintenance System for Water-Saving Equipment and Pipelines

LAZZEN adheres to the Water Law of the People's Republic of China and the Water Pollution Prevention and Control Law empha- and Water Conservation Management Rewards and Penalties System. By combining inspection guidance with performance assess-

sizing water resource protection implementing water-saving initiatives and continuously improving water resource management ments each department is required to regularly inspect its water usage. The water conservation leadership team conducts three

efficiency. major inspections each month to identify any violations or potential water usage hazards ensuring timely rectification or corrective

LAZZEN relies on two main water sources: municipal tap water and externally purchased steam. Tap water is primarily used for measures within a specified period.cooling system replenishment pure water preparation and domestic needs while steam is mainly used for heating cleaning tanks

in the electroplating process. Due to the significant proportion of water lost through evaporation the water recycling rate is high

Water Conservation

and wastewater discharge volume is relatively low. Water Conservation Measures

Plan

Water Resource Management The electroplating workshop has adopted a counterflow rinsing process for secondary waste-Reuse of Electro- water reuse. A newly purchased industrial wastewater filter will further enable multi-stage

plating Rinse Waste-

LAZZEN has established a comprehensive water measurement and conservation management framework including the Water Usage recycling increasing wastewater reuse rates and reducing daily pure water consumption. The water

Measurement Management System Water Conservation and Usage Statistics System Energy Measurement Equipment Management system can process up to 6 tons of wastewater per day to meet reuse standards.Procedure and Maintenance and Inspection Management System. Additionally LAZZEN has formed a Water Conservation Leadership

Team and a three-tier management network across leadership departments and workshop teams. Measures such as "daily inspec- The largest water-consuming unit is the air conditioning and cooling system. The cooling

tions monthly assessments and incentive-based implementation" ensure accountability for water conservation efforts. Smart Control Ret- tower has already adopted an advanced closed-loop cooling system. Smart management

rofit for Air Condi- systems have been installed in the ventilation system and partitions have been added to

LAZZEN has fully implemented water conservation initiatives by developing a long-term water-saving mechanism. These efforts have tioning Systems office and production areas to prevent cooling loss reducing cooling tower circulation and

supported the effective execution of water conservation programs. In 2024 LAZZEN successfully applied for and achieved recognition achieving significant water and energy savings.as a 2024 Zhejiang Province Water-Saving Enterprise and completed the water balance test for industrial enterprises in Jiaxing City.LAZZEN actively promotes water conservation awareness through various initiatives includ-

ing displaying conservation slogans and organizing water conservation knowledge seminars.Water Conservation

Posters and handbooks are distributed to educate employees on water-saving practices.Awareness and

Practical activities encourage employees to adopt water conservation measures in daily op-

Education

erations. A "Water Conservation Pioneer" initiative has been established and strict reward

and penalty systems are in place for individual or departmental water usage compliance.LAZZEN is considering launching a rainwater collection project to reduce reliance on the

municipal water supply. Once implemented the system will provide a stable and sustainable

Rainwater Recycling

water source for factory landscaping toilet flushing and floor cleaning especially during dry

seasons. Additionally recycling rainwater will help reduce pollution of natural water bodies.Installation of Wa- LAZZEN has upgraded workshop restrooms with water-saving valves reducing fresh water

ter-Saving Valves consumption by an average of 4000 m3 per year.Smart water meters have been installed at various water usage points to enable real-time

Remote Monitoring monitoring and management of water consumption across the factory and its branches. This

System for Water system has successfully identified and resolved multiple leakage issues significantly reduc-

Water Usage Scenarios

Usage ing water waste. The system's alarm mechanism promptly detects abnormal water usage

preventing potential financial losses.Water Conservation Improvement Plan

49 50Collective

About This Message from About Honors in Digital-Intelligent New Quality Climate Change and Building a Green

Supply Chain

Responsibility Full Lifecycle

Sustainable Uniting Hearts Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Service Compliance Toward a Shared

Guardianship of

Community Well- Assurance Performance

Indicator and

Production Management Governance Vision Statement Table Indexbeing Suggestions

Water Resource Indicators and Targets Pollutant Emissions

The water resource reuse rate is 99.23% the indirect cooling water circulation rate is 99.66% the steam condensate recovery rate is LAZZEN complies with the Environmental Protection Law Water Pollution Prevention and Control Law Air Pollution Prevention

97.8% the wastewater reuse rate is 59.7% and the drainage rate is 43.2%. and Control Law Soil Pollution Prevention and Control Law Noise Pollution Prevention and Control Law and the Pollutant Dis-

charge Permit Management Measures. LAZZEN implements pollutant discharge management in accordance with industry-speci-

fied emission standards and total pollutant discharge control indicators.Disclosure Item Unit 2022 2023 2024

Municipal Water Purchase Tons 160632 189648 141198 Pollutant Emission Control

Total Circulating/Recycled Water Tons — — 5016

In accordance with the requirements of the regulatory system and the pollutant dis-

charge permit LAZZEN has established a series of pollutant emission management

Total Water Consumption Tons — — 146214 frameworks including the Wastewater Discharge Management Procedure the Waste

Gas Emission Management Procedure and the Noise Emission Management Proce-

dure. LAZZEN has wastewater treatment facilities and exhaust gas treatment systems

which undergo self-monitoring in strict accordance with pollutant discharge permit re-

Material Resources quirements. Additionally qualified third-party monitoring agencies are commissioned

to conduct environmental monitoring. In 2024 all environmental monitoring results

LAZZEN has established management regulations for material met emission standards.resources including the Product Material Scrap Management Pollutant Discharge Permit of Liangxin Furthermore LAZZEN conducts risk assessment and analysis of pollutant emissions (Haiyan)

Measures Waste Management Procedures Idle Material Pre- formulating corresponding risk response measures and continuously enhancing pol-

vention and Handling Management Measures and Scrap Han- lutant discharge management and monitoring efforts.dling Process Business Guidelines. In 2024 LAZZEN updated

the Product Material Scrap Management Measures adding

branches for finished product scrapping supplier discount

processing and resale of electronic materials. LAZZEN has Pollution Emission Target

built a recycling system for raw materials and packaging ma-

terials proactively assuming responsibility for the recycling

No. Pollutant Emission Target Achievement

and resource utilization of discarded products. This ensures

the effective circulation of obsolete products between manu- 1 Wastewater Wastewater reuse rate reaching 40%–60% Achieved

facturers consumers recycling companies and dismantling

enterprises. 2 Exhaust Gas Harmless treatment of exhaust pollutants Achieved

For material transportation within departments LAZZEN uses

environmentally friendly electric handcarts and all turno- Factory noise levels meeting <60 dB during the day and

RoHS and Recyclable Markings on Product Packaging 3 Noise Achieved

ver tools are reusable plastic containers. Pallets are made <50 dB at night

of high-density reusable plastic. The automated sorting and

warehouse storage system minimizes the use of corrugated

paper aligning with the green packaging philosophy.Wastewater Treatment

Circular Economy LAZZEN has formulated the Wastewater Discharge Management Procedure to manage wastewater conducting regular self-monitor-

ing and source inspections. Wastewater is only discharged into the municipal pipeline network after being fully treated and meeting

LAZZEN adopts circular economy principles for idle materials and scrapped products utilizing component dismantling and recy- discharge standards at the sewage treatment station. Each year a professionally certified third party is commissioned to test the

cling as well as inventory material discount sales. wastewater with results showing that all indicators are significantly below the limits set by the Comprehensive Wastewater Dis-

charge Standards.If materials become unusable due to company-related reasons and need to be scrapped or resold they can be processed at a dis-

counted price through supplier negotiations. LAZZEN follows the Material Scrap Application Process to handle inventory write-offs. In wastewater treatment LAZZEN adopts reclaimed water reuse measures. The unit wastewater discharge from the electroplating

If scrapped products can be sold they are processed in accordance with the Scrap Handling Process Business Guidelines. Addition- line has been reduced from 0.25t/m2 to 0.23t/m2 achieving the reuse of high-concentration acidic and alkaline wastewater. The

ally LAZZEN provides multiple recycling and trade-in services through its official website and WeChat platform. Discarded products reuse of silver plating rinse water reduces cyanide consumption decreases the amount of silver ions in wastewater treatment and

sent to the waste dismantling department are categorized based on component attributes and handed over to specialized third-par- allows silver recovery for reuse. Additionally the grinding water recycling system reduces wastewater treatment by 6 tons per day

ty organizations for recycling and reuse promoting a circular economy model. while also reducing grinding fluid consumption and achieving a recovery rate of over 60%.

51 52About This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain

Collective

New Quality Responsibility Full Lifecycle

Sustainable Uniting Hearts Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Service Compliance Toward a Shared

Guardianship of

Community Well- Assurance Performance

Indicator and

Production Management Governance Vision Statement Table Indexbeing Suggestions

LAZZEN has implemented multiple air pollution control measures utilizing purification technologies such as ROC zeolite bed cata-

lytic combustion and UV photolysis. During the reporting period LAZZEN enhanced its exhaust gas collection by installing additional

collection hoods for newly added positions in workshops involving exhaust emissions ensuring a "one-position one-hood" setup to

maximize the collection area. For the DC workshop the potting exhaust treatment system was upgraded from honeycomb activated

carbon to granular activated carbon increasing removal efficiency by over 15%. Additionally for VOC-containing exhaust from coating

processes LAZZEN adopted an adsorption-catalytic combustion treatment process achieving a treatment efficiency of 99.5%.Wastewater Treat-

ment Facilities and

Equipment

Indicator Unit 2022 2023 2024

Total Wastewater Discharge Ton(s) 144568.8 170683 124482

Indicator Unit 2024 Exhaust Gas Treatment Equipment

Chemical Oxygen Demand (COD) Ton(s) 0.116

Biochemical Oxygen Demand (BOD) Ton(s) 0 Indicator Unit 2022 2023 2024

Suspended Solids Ton(s) 0 Total Exhaust Gas Emissions m3 128642520 77185512 588960000

Ammonia Nitrogen Ton(s) 0.002

Total Nitrogen (TN) Ton(s) 0.026

Indicator Unit 2024

Total Phosphorus (TP) Ton(s) 0.001

Particulate Matter kg 2

pH Ton(s) 6-9

Total Non-Methane Hydrocarbons kg 991.008

VOC Emissions kg 3964.034

Waste Gas Treatment

LAZZEN has formulated the Waste Gas Emission Management Procedure. In 2024 we added new requirements for the collection Noise Management

and treatment of waste gas from electroplating processes as well as maintenance regulations for waste gas treatment equipment.Additional guidelines were established for employees working inside exhaust towers and new local standards from Zhejiang Prov- LAZZEN has established the Noise Emission Management Procedure. In 2024 we updated the regulations to include the primary

ince were incorporated into emission regulations. noise-generating equipment and the noise emission standards for the Hangzhou Bay Super Factory.LAZZEN has implemented risk management for waste gas emissions and developed a series of mitigation measures to address the LAZZEN conducts quarterly noise monitoring across the entire facility setting management targets of <60 dB during the daytime

risk of excessive emissions. According to environmental protection acceptance monitoring by a professional third-party agency all and <50 dB at night both of which have been achieved. In terms of noise control measures we continue to optimize the plant lay-

waste gas emission indicators meet the required standards. out select low-noise equipment enhance equipment maintenance and implement effective noise reduction measures such as

vibration isolation and soundproofing for high-noise equipment. For example sound-absorbing cotton is installed inside air com-

Establish Routine Operation Assign professional operation and maintenance personnel to conduct regular inspections main- pressor baffles to ensure that factory boundary noise complies with emission standards. According to environmental acceptance

and Maintenance System tenance and repairs of the facilities. Replace vulnerable components in a timely manner record monitoring conducted by a professional third-party agency the factory's daytime and nighttime noise levels meet the require-

for Air Treatment Facilities facility operation parameters and maintenance status to ensure continuous optimal performance. ments of the Environmental Noise Emission Standards for Industrial Enterprise Boundaries.Regularly entrust qualified third-party testing agencies to conduct comprehensive air quality mon-

Conduct Regular

itoring in accordance with national standards. Ensure the accuracy and reliability of monitoring Soil Pollutants

Self-Monitoring data and adjust air treatment processes and operational parameters accordingly.LAZZEN regularly monitors and inspects soil conditions prioritizing soil pollution management. All industrial wastewater pipelines

Strengthen environmental management in production processes optimize production techniques

Enhance Environmental are installed as overhead pipelines to prevent underground leaks that could lead to soil contamination.to minimize air pollutant emissions. Develop emergency response plans for excessive emissions

Management and Emergency such as reducing production loads or increasing air treatment chemical input and actively cooper- According to environmental acceptance monitoring conducted by a professional third-party agency the soil pollutant concentra-

Measures ate with environmental authorities in investigations and resolutions. tions in the Company's area are all below the screening values for Category II land use specified in the Soil Environmental Quality

Standard for Construction Land Soil Pollution Risk Control (Trial) (GB36600-2018).Measures for Mitigating Excessive Exhaust Emission Risks

53 54About This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective Independent Key Feedback

Report the Chairman LAZZEN 2024 New Quality Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared

Guardianship of Assurance Performance Indicator and

Production Management Governance Vision Community Well-being Statement Table

Index Suggestions

Waste Disposal Hazardous Waste

The Company's hazardous waste includes waste cutting fluids hazardous chemical packaging waste wastewater sludge and waste

LAZZEN complies with the Solid Waste Pollution Prevention and Control Law the General Industrial Solid Waste Storage and Landfill paint packaging barrels. Each year LAZZEN signs hazardous waste disposal contracts with qualified third-party organizations. The

Pollution Control Standard the Hazardous Waste Storage Pollution Control Standard and other relevant regulations to manage waste. entire waste transfer process is documented and verified through the national solid waste management system.LAZZEN has implemented risk management measures for hazardous waste. These measures address potential risks associated

with the collection storage transportation and disposal of hazardous waste such as leakage soil and water contamination and

Waste Treatment severe environmental pollution incidents.LAZZEN primarily generates solid waste such as used oil rags Improving

and gloves hazardous chemical packaging waste spent acti- Establish and refine hazardous waste management regulations defining the entire process from Management

vated carbon laboratory waste liquids waste oil and general generation to final disposal and assigning responsibilities.Systems

packaging waste. LAZZEN has established the Waste Manage-

ment Procedure and the Waste Classification and Treatment

Regulations which outline compliance requirements and dis- Conduct regular professional training for hazardous waste management personnel to ensure Enhancing Per-

posal processes for general solid waste hazardous waste and familiarity with waste characteristics classification methods packaging requirements and emer-

sonnel Training

food waste. In 2024 these regulations were updated to clarify gency response measures.departmental responsibilities and expand the classification of

hazardous waste. LAZZEN ensures that all waste is legally and

compliantly disposed of preventing harm to the surrounding National Pollution Source Monitoring Data Management and Sharing Optimizing Storage Inspect and upgrade hazardous waste storage warehouses to meet national standards ensuring

environment and human health while avoiding secondary System Facilities leak-proof loss-prevention and rain-resistant features.pollution. Every year the Company updates and submits its hazardous and solid waste management plans for approval by the local

environmental authorities. Subsequent hazardous waste transfers are recorded and reported via the system platform.Strict Supervision

Select qualified and experienced hazardous waste disposal companies establish detailed con-

of Transport and

Waste Disposal Strategy tracts define responsibilities and strengthen transport monitoring.Disposal

LAZZEN adheres to the principles of "resource utilization reduction and harmless disposal" in handling solid waste fully imple- Establishing an

menting its environmental protection responsibilities. Develop emergency response plans conduct regular drills and enhance the company's ability Emergency Response to handle environmental emergencies to minimize losses and impacts.Mechanism

Waste Disposal Targets

Risk Management Measures for Hazardous Waste Leakage

No. Waste Disposal Target Achievement Status

In 2024

1 Legal disposal of hazardous waste >1 time/year Achieved

2 Zero violations in hazardous waste disposal Achieved LAZZEN's non-hazardous waste recycling rate reached 100%.

3 Negative or zero annual growth rate of general industrial solid waste intensity Achieved

Item Unit 2024

4 Negative or zero annual growth rate of industrial hazardous waste intensity Achieved

Total Waste Generated Ton(s) 100.512

Total Hazardous Waste Ton(s) 29.952

General Waste Total Non-Hazardous Waste Ton(s) 70.56

Hazardous Waste Intensity Ton/RMB 10000 0.00008

LAZZEN's general industrial solid waste including plastic materials packaging paper plastic foam packaging and metal waste is Non-Hazardous Waste Intensity Ton/RMB 10000 0.00019

recyclable. Every year LAZZEN entrusts a professional third-party organization with sorting and disposal. The process involves col- Recycled Waste Volume Ton(s) 70.56

lecting waste in workshops transporting it to the general solid waste warehouse packaging it and then delivering it to paper mills

for processing.

55 56About This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective Independent Key Feedback

Report the Chairman LAZZEN 2024 New Quality Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared

Guardianship of Indicator

Production Management Governance Vision Community Well-

Assurance Performance Index and

being Statement Table Suggestions

Emergency Drill for Hazardous Chemical Leakage in the Electroplating Workshop

During the reporting period LAZZEN conducted an emergency drill for

hazardous chemical leakage in the electroplating workshop. The drill simu-

lated a malfunction of the water replenishment valve causing the cyanide

tank to overflow with the liquid spreading to the adjacent spot-welding

workshop. Relevant departments followed emergency response protocols

to handle the incident in compliance with safety regulations. All personnel

involved in the drill followed instructions and managed the situation safely.Chemical Management Each team member fulfilled their respective duties successfully completing

all drill tasks. This exercise significantly improved the efficiency of the emer-

LAZZEN has established various chemical management regulations including the Chemical Management Procedure "Five Pairs" gency response team in handling hazardous chemical leakage incidents.Emergency Drill for Leakage in the Electroplat-

Management Framework for Highly Toxic Chemicals (Explosive and Drug Precursor Chemicals) in the Electroplating Manufacturing ing Workshop

Department Safe Operating Procedures for Hazardous Chemicals in the Electroplating Manufacturing Department and Safety Pro-

cedures for Handling and Unloading Hazardous Chemicals in the Electroplating Manufacturing Department.LAZZEN has a dedicated hazardous chemical warehouse where chemicals are stored in designated zones based on their classi-

fication. The entire process from storage and retrieval to usage strictly follows the management requirements for highly toxic

substances. Personnel responsible for managing highly toxic chemicals are required to have a thorough understanding of their

handling procedures. Additionally the storage management of highly toxic chemicals strictly adheres to the "Five Pairs" System

which includes dual-person receiving and dispatching dual-person bookkeeping dual-person dual-lock storage dual-person

transportation and dual-person usage.LAZZEN's hazardous chemical management is directly integrated into Zhejiang Province's Integrated Smart Governance Platform

for Key Materials (Highly Toxic Chemicals) allowing for government-linked oversight. LAZZEN conducts regular monitoring and

proactively reports safety hazards actively undergoing government inspections. It submits self-inspection risk points on the safety

production platform every month and ensures timely rectifications. Furthermore LAZZEN actively organizes training and assess-

ments on hazardous and highly toxic chemicals conducts emergency response drills and strengthens employees' awareness of

safety measures and risk management.Highly Toxic Chemical Management Training Company Chemical Safety Training

Emergency Drill for Anti-Theft and Anti-Robbery of Highly Toxic Precursor and Explosive Chemicals

Integrated Smart Governance Platform for Highly Toxic Chemicals

57 58Supporting of the UN SDGs

04

Supply Chain Responsi-

bility Management

Concept

LAZZEN upholds the concept of sustainable development by promoting cor-

porate sustainability through supply chain management initiatives and has

established a closed-loop lifecycle management framework for suppliers

enhancing supply chain collaboration efficiency while implementing differ-

entiated supplier management measures. In terms of environmental protec-

tion LAZZEN conducts regular reviews of suppliers' environmental initiatives

comprehensively evaluates their environmental performance and builds a

digital management framework to advance the development of a green sup-

ply chain providing valuable insights for the industry's sustainable growth.Our Actions

●?Supplier ●?Green and Sustainable ●?Building a Stable and

Management Supply Chain Secure Supply Chain

Key Performance

100% supplier compliance with the Supplier Integrity Agreement

100% of suppliers have signed contracts that include environmental

and labor requirements

83% suppliers have undergone social impact assessments

120% suppliers have undergone social impact assessmentsDigital-Intelligent Supply Chain Sustainable Uniting Hearts Collective About This Message from About Honors in Climate Change and Building a Green Full Lifecycle Guardianship of Independent Key Feedback

Report the Chairman LAZZEN 2024 New Quality Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared Assurance Performance

Indicator and

Production Management Governance Vision Community Well-being Statement Table

Index Suggestions

As part of its ongoing digital transformation of supply chain management LAZZEN obtained Shanghai Green Supply Chain Man-

Supplier Management agement Enterprise Certification in 2023 and advanced the SMS Performance System Optimization Project and Quality QMS & MES

Optimization Project in 2024 reducing overall product delivery cycles by 35% and significantly enhancing supply chain efficiency

and responsiveness.Sustainable Supply Chain Governance

LAZZEN upholds the principles of sustainable development and is committed to building a stable and responsible supply chain. Sustainable Supply Chain Strategy and Goals

We have established a series of regulatory documents including the Supplier Admission Certification Management Procedure

Supplier Tiered and Graded Management Measures and Supplier Performance Management Measures and have structured a Pro- LAZZEN is dedicated to building a green and sustainable supply chain. In terms of management strategy the company assigns re-

curement Committee (PC) governance framework. In 2024 LAZZEN optimized the Procurement Committee Management System sponsible experts to develop tailored strategies for different product categories.and updated the Supplier Social Responsibility Commitment Letter incorporating provisions related to human rights environmen- LAZZEN has established green supply chain development objectives and formed a dedicated Green Supply Chain Management

tal safety and relevant laws and regulations. These efforts drive the standardization and efficiency of supplier certification audit- Department. LAZZEN has also developed a Green Information Platform integrating fundamental information management green

ing and rating processes. production green material management supplier management green design and green logistics into a comprehensive digital

By refining supplier admission performance evaluation and tiered management rules LAZZEN has enhanced the closed-loop li- system.fecycle management of suppliers improved supply chain coordination and fostered a sustainable procurement platform. LAZZEN

has also formulated a supplier performance assessment framework evaluating suppliers across four key dimensions—business

delivery quality and technology—to facilitate tracking and control. Suppliers are categorized into five levels: Strategic Suppliers

Preferred Suppliers Qualified Suppliers Restricted Suppliers and Eliminated Suppliers. This differentiated management approach Sustainable Supply Chain Risk Management

has improved efficiency and earned LAZZEN A-grade supplier certification from multiple partners.LAZZEN collaborates with suppliers to comply with international environmental standards and corporate social responsibility

Chief Executive Officer regulations. The Company mitigates supply chain risks through the measures. Including diversified supplier strategy regular sup-

plier performance evaluations emergency response planning compliance agreements enhancing supplier communication and

General Manager of Supply Director of Supply Chain cooperation supplier development and improvement programs and implementation of advanced supply chain management

Chain System Quality and Operations frameworks. These initiatives ensure stable business operations and sustainable development strengthening LAZZEN's resilience

against market fluctuations and unforeseen events. By maintaining an industry-leading position and a strong corporate reputation

the company secures a solid foundation for long-term growth.Sustainable Supply Chain Metrics

In 2024

Total number of suppliers in 2024: Supplier Integrity Clause signing rate:

2024 Procurement Committee Organizational Structure 272 100%

Supplier System Certification List

Percentage of suppliers with contracts including Number of suppliers as- Number of suppliers assessed

environmental and labor requirement clauses: sessed for social impact: for environmental impact:

Quality Management System Certification (ISO 9001) Environmental Management System Certification (ISO 14001)

Occupational Health and Safety Management System 100% 83 120

Quality Management System Certification (IATF 16949)

Certification (ISO 45001)

Intellectual Property Compliance Management System Hazardous Substances Management System Certifica- Number of suppliers certi- Number of suppliers certi-

(GB/T 29490) tion (IECQ QC 080000) fied with ISO 9001: fied with ISO 14001:

Information Security Management System Certification

Energy Management System Certification (ISO 50001) 256 125

(ISO/IEC 27001)

Supplier System Certification List

6162

General Manager of Opera-

tions and Human Resources

System

General Manager of Strategy

and Finance System

General Manager of Supply

Chain System

General Manager of Intelligent

Terminal and DC Contactor

Product Line System

General Manager of Low-Volt-

age Component Product Line

and Technical Quality System

General Manager of Marketing

and Intelligent Power Distri-

bution Product Line SystemAbout This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective

New Quality Guardianship of

Independent Key Indicator Feedback

Report the Chairman LAZZEN 2024 Production Opportunities New Ecosystem

Responsibility

Management Service

Compliance Toward a Shared

Governance Vision Community Well-

Assurance Performance Index and

being Statement Table Suggestions

Green and Sustainable Supply Building a Stable and Secure Supply

Chain Chain

To protect the rights and interests of both parties and ensure compliance in supplier management LAZZEN requires suppliers to To ensure supply chain security LAZZEN incorporates dual-source backups for critical materials and maintains both short-term

sign the Confidentiality Agreement Integrity Cooperation Agreement and Environmental (RoHS) Agreement. These agreements and long-term supplier backup lists and also prioritizes contractor safety management by conducting regular safety training and

help safeguard fundamental rights and promote responsible business practices. During the supplier admission process LAZZEN supervision including lean improvement and quality enhancement guidance for suppliers. Contractors are required to comply

comprehensively evaluates environmental social and governance (ESG) factors. Suppliers are required to provide the Supplier with occupational health and safety regulations during projects. Furthermore LAZZEN performs regular safety inspections of con-

Social Responsibility Commitment Letter Supplier Environmental Status Survey and Evaluation Form and Environmental and Oc- tractors' facilities and equipment to prevent accidents ensuring a secure and stable supply chain.cupational Health and Safety Requirements Notice.In terms of environmental protection LAZZEN regularly reviews suppliers' environmental measures. To thoroughly assess environ- Launch of the Lean Quality Improvement Initiative

mental performance LAZZEN has established an independent Environmental System Audit Form which evaluates suppliers across

six key aspects: management systems R&D procurement incoming material inspection production and logistics. This detailed During the reporting period LAZZEN launched a Lean Quality Improvement

assessment covers environmental management systems hazardous substances control and restricted materials to build a respon- Initiative leveraging lean management tools and methodologies to precisely

sible supply chain system. identify and eliminate inefficiencies in the production process. This initiative

LAZZEN has implemented a supplier lifecycle management framework a fully digitalized workshop management framework aimed to comprehensively optimize workflows leading to significant improve-

an equipment lifecycle management framework and a comprehensive quality management framework. These digital and pro- ments in both product quality and production efficiency.cess-based systems help reduce material consumption improve energy efficiency monitor the hazards of raw and auxiliary materi- To address identified issues the Company developed 20 targeted improve-

als and minimize waste generation. Additionally LAZZEN has promoted the use of standardized returnable transit boxes replacing ment measures covering areas such as equipment maintenance operational

traditional cardboard packaging for certain materials further advancing sustainable packaging and delivery solutions. standardization and employee training. So far 12 of these measures have

been implemented.Lean Quality Improvement Initiative

Awards and Honors

Defect rate reduction: Shortened produc- Lower production Comprehensive lean

from 4.5% to 1.2% tion cycle: from 12 costs: reduced by 5% training: 3 company-wide

days to 7 days sessions resulting in 30

improvement suggestions

Item Unit 2022 2023 2024

Total Number of Suppliers Number 271 257 272

Suppliers Signing the Integrity Agreement % — 100 100

Shanghai Green Supply Chain Best Energy-Carbon Syn- Best Energy-Carbon Syner- Percentage of Suppliers Signing Contracts with Environ- % — 100 100

Management Certification ergy Exploration Trophy gy Exploration Certificate mental & Labor Requirements

Number of Suppliers Assessed for Social Impact Number — 83 83

Number of Suppliers Assessed for Environmental Impact Number — 120 120

Number of Suppliers Certified for ISO 9001 Number 253 241 256

Number of Suppliers Certified for ISO 14001 Number 120 120 125

Transparent Procurement Number of Suppliers Certified for ISO 45001 Number 83 83 83

Number of Suppliers Identified with Actual or Potential

Number 0 0 0

Major Negative Social Impact

To ensure an open and transparent procurement process LAZZEN requires suppliers to sign an Integrity Cooperation Agreement Number of Suppliers Identified with Actual or Potential

which explicitly regulates procurement practices. An audit and reporting hotline is also provided for supervision. Additionally dur- Number 0 0 0Major Negative Environmental Impact

ing holidays LAZZEN issues integrity initiatives to all suppliers firmly prohibiting any form of unethical behavior and maintaining a

clean procurement environment. Total Number of New Suppliers Number 18 15 15

Percentage of Locally Sourced Suppliers % — 13 13

Number of Suppliers Terminated Number — 29 0

63 64Supporting of the UN SDGs

05

Full Lifecycle Service

Concept

LAZZEN upholds the philosophy of "Customer Success at the Core Quality as

Our Honor" striving to become synonymous with industry-leading excellence.Certified for its Information Security Management System (ISMS) the Compa-

ny has strengthened its defenses by establishing a comprehensive framework

that covers device network data and software/hardware security. This sys-

tem integrates advanced security permission management capabilities and

enforces granular data access controls. Additionally LAZZEN has developed

comprehensive contingency plans for information security emergencies and

conducts regular network risk assessments information security training and

emergency drills. These initiatives ensure the protection of customer data

while enhancing employee awareness of security and privacy practices.Our Actions

●?Product ●?Customer ●? Customer Privacy and

Quality Service Security

Key Performance

100% of the business scope is covered by quality management system

certification

The product inspection pass rate has increased to99.1%

We conducted 3 information security auditsAbout This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Sustainable Uniting Hearts

Collective Independent Key

New Quality Responsibility Full Lifecycle Compliance Toward a Shared Guardianship of Assurance Performance Indicator

Feedback

Report the Chairman LAZZEN 2024 Production Opportunities New Ecosystem

and

Management Service Governance Vision Community Well- Indexbeing Statement Table Suggestions

Product Quality

Improve the quality of new prod- Improve the quality of mass-pro-

uct projects duced products

●?Optimize business processes

Quality Management ●?Strengthen quality control for pro- ●?Establish a special project for TOP

jects issue improvement

LAZZEN adheres to the quality philosophy of "Customer

Success at the Core Quality as Our Honor" "Building Quality

Competitiveness to Become the Industry Benchmark for High 2026

Quality" "Compliance with Processes Doing It Right the First 2025 Establishing Enhance the quality level of Improve the quality of material

Time and Continuous Improvement" and "Establishing IPD 2024 Deep Benchmark materials Key Quality inspections

(Integrated Product Development)-Driven Quality Require- Strong Promotion Product quality ●?Align quality standards and improve ●?Refine inspection standards and sam-

ments and Standards to Form a Complete Efficient and Adap- Improve-Execution Product quality achieves industry change efficiency pling plans

tive Quality Management System". LAZZEN upholds a quality Full integration of reaches indus- benchmark stand- ment Mea-●?Improve material qualification rates by ●?Enhance inspection efficiency and

culture centered on "Prevention First Self-Management Doing product quality try-leading levels ards providing guidance to key suppliers sures quality

It Right the First Time and Continuous Improvement" with a management with

vision to achieve industry-leading competitiveness in product corporate manage-

ment

quality and strive to establish LAZZEN as the industry bench-

mark for high quality. Through relentless innovation and opti-

Increase satisfaction among Enhance compliance testing for

mization LAZZEN aims to enhance product quality and deliver

exceptional products and services to customers and society. core customers mass-produced product qualityQuality Strategy and Goals

Currently the Company is certified under the ISO 9001 Quality ●?Establish a core customer service ●?Establish periodic reliability inspection

Management System. team and develop customized service rules and processes and implement

solutions. periodic reliability testing services.Quality Management Indicators and Targets

No. KPI Target Quality Risk Monitoring

1 Customer Audit First Pass Rate 100%

2 Customer Complaint Reduction Rate -30% To strengthen quality risk control LAZZEN conducts incoming material inspection

3 PONC (Price of Non-Conformance) Reduction Rate -6% management through QMS to ensure the quality of incoming materials. On-site quality

risks are effectively controlled through first article inspection in-process inspection

4 RoHS Complaint Issues at Client End 0 warehouse entry inspection and pre-shipment inspection. Regular monthly quality

5 Defective Batch PPM Reduction Rate for Materials -25% meetings and annual management review meetings are held to assess product quality

6 Incoming Material Qualification Rate 98.50% risks the performance levels and trends of quality objectives and to determine quality

7 First Pass Rate for FAI (First Article Inspection) 48.50% improvement directions. At the same time by conducting regular internal audits and

8 Reduction Rate of Level 3 Quality Issues -30% inspections to identify areas for improvement in quality management across business

9 RoHS Non-Conformance Incidents for Incoming Materials 15 departments we promptly follow up on non-conformity corrections and enhance the

consistency of operations and quality management processes thereby comprehen-

sively improving the Company's quality management level. Quality Incentive Evaluation Activities

Product Quality Key Performance Indicators

Improvement

Quality management framework certification coverage:

In 2024 LAZZEN implemented a continuous quality manage-

ment mechanism supplemented by QCC (Quality Control 100%

Circle) initiatives and improvement recommendations to op-

timize business processes strengthen project quality control Product sampling pass rate improved from

and establish a TOP Issues Improvement Initiative. 96.6% in 2023 to 99.1% in 2024.Quality Training

67 68Collective

About This Message from About Honors in Digital-Intelligent New Quality Climate Change and Building a Green

Supply Chain Full Lifecycle Sustainable Uniting Hearts Guardianship of Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared Community Well- Assurance Performance

Indicator

Production Management Governance Vision Statement Table Index

and

being Suggestions

In 2024 Customer Service

LAZZEN organized a total of three quality incentive evaluation activities with 218 candidates submitted. After eval- LAZZEN has established a comprehensive customer service system and an after-sales complaint handling mechanism to continu-ously enhance customer satisfaction. Additionally LAZZEN strictly regulates distributor cooperation and actively organizes training

uation five individuals received first-level incentives 14 received second-level incentives and 127 received programs to strengthen standardized management and improve market competitiveness.encouragement awards.Customer Service Management

The Company conducted a total of 38 quality training sessions including 32 internal instructor-led sessions

and six sessions conducted by external instructors. To further improve customer service quality LAZZEN has focused on building a well-structured management framework. This

system includes a preemptive quality issue escalation and resolution mechanism as well as an after-sales customer complaint

handling mechanism. Through preventive management and rapid response measures LAZZEN ensures that effective actions are

taken before issues arise and that any problems are swiftly resolved. This approach provides customers with more reliable and

Product Recall high-quality products and services ultimately enhancing customer satisfaction.The Customer Complaint and After-Sales Handling Management Procedure outlines the responsibilities of distributors/offices

LAZZEN has established management systems such as the Customer Return and Recall Management Procedure and the Non-Con- the Customer Technical Service Department various technical support departments the Process Quality Department and other

forming Product Management Procedure creating a comprehensive after-sales issue resolution process and emergency response relevant departments. We also set clear guidelines for record-keeping and follow-up actions to ensure a structured and efficient

plan. These ensure that both standard and sample order returns and recalls are handled promptly effectively and reasonably customer service process.protecting both the Company's interests and the legitimate rights of customers. In 2024 LAZZEN revised the Customer Return and

In 2024

Recall Management Procedure.Product Recall Process

The overall customer satisfaction score was 93.11.●?Customers submit quality replacement requests complaints and return In 2024

applications.Score 93.11

The number of products 92.28

●?Non-quality returns: Information is audited and processed to issue re- recalled was

call notices;Quality-related returns: Information is audited recall notices

are issued and on-site after-sales service is initiated. 0

The sales revenue affected 2023 2024 Year

●?Count and confirm the quantity of returned products. by recalled products was

0

●?Conduct a preliminary inspection of the returned products.文档密级：公开

The number of product 感谢信

recall incidents was 尊敬的上海良信电器股份有限公司领导：

●?Confirm the quality analysis and handling plan for the returned prod- 您好！

在此，我谨代表我司，向贵公司长期以来给予的坚定支持与深切合作表达最深切的感激之情。上海良信

电器股份有限公司不仅是我司的重要合作伙伴，更是我们信赖与依靠的坚强后盾。在此，特别向贵公司的售ucts. Based on three categories of quality issues—safety and major 0 后服务团队致以最诚挚的谢意。 回首过去的一年，贵公司售后服务人员（祝曲波、彭悠忧、陈康康），以精湛的专业技能和高效的服务态度，为我司风电光伏储能项目筑起了一道坚实的售后保障防线。无论是烈日炎炎的盛夏，还是寒风凛冽的impact issues batch issues and general issues—decisions are made 严冬，面对每一次紧急维修任务，贵公司售后团队总能迅速响应，精准施策，及时有效地解决各类故障，确保了我司工程项目的平稳运行与持续发展。

尤其值得一提的是，贵司售后工作人员彭悠忧在乌兹别克斯坦卡州现场，因断路器故障导致无法合闸，through meetings. Conduct a meeting for decision-making complete 他迅速响应并紧急从国内带备件前往现场，处理问题，同时又现场指导培训我们国外服务商人员对断路器的故障判断，以及对断路器的拆解组装。这样的事情还有很多，他凭借他丰富的经验及专业素养，多次在关键时刻力挽狂澜，为我司工程项目的顺利推进提供了不可或缺的助力，成为了我们学习的榜样和典范。此外，贵公司售后服务团队在长期为我司提供固定且全面的售后服务过程中，积累了丰富的实践经验，能够精准分product recall lists and notices and initiate the recall process. 析并总结常见故障类型，与我司工作人员共享高效解决方案，实现了沟通的无缝衔接与服务的精准对接，充分展现了贵公司服务的专业性与高效性。

展望未来，我司衷心希望与贵公司继续深化合作，携手并进，共同开创更加辉煌的明天。我们坚信，在双方的共同努力下，我们的合作关系必将更加紧密，发展前景必将更加广阔。

再次感谢贵公司及其售后服务团队的辛勤付出与无私奉献！期待在未来的日子里，我们能够继续携手共进，共创佳绩！●?Issue rework/repair plans for returned products and ship as needed. 阳光电源股份有限公司 风能客户服务中心 2024 年 12 月 18 日

●?Disassemble or dispose of the returned products.LAZZEN After-Sales Service Five-Star Certification Customer Appreciation Letter

69 70Digital-Intelligent Supply Chain Sustainable Uniting Hearts Collective About This Message from About Honors in New Quality Climate Change and Building a Green Responsibility Full Lifecycle Compliance Toward a Shared Guardianship of

Independent Key Indicator Feedback

Report the Chairman LAZZEN 2024 Production Opportunities New Ecosystem Management Service Governance Vision Community Well-

Assurance Performance Index and

being Statement Table Suggestions

Customer Service Honors and Awards

Honors and Awards 2024 "Star Plan" Dealer After-Sales Elite Training

In 2024 LAZZEN launched a 5-day

"Star Plan" dealer after-sales course.The course covered product knowl-

edge training on molded case circuit

breakers dual power supplies con-

trol isolation switches frame and

2024 Strategic Partner of the 2024 Excellent Supplier of Vertiv micro-circuit breakers including

China Survey and Design Asso- Technology theoretical learning practical opera-

ciation Electrical Branch tions fault case sharing and exami-

nations.

2024 "Star Plan" Dealer After-Sales Elite Training Class

2023 Outstanding Partner of Sungrow 2024 Quality Supplier of China

Power Supply Co. Ltd. Southern Power Grid

Responsible Marketing

LAZZEN strictly adheres to national laws and regulations including the Advertising Law in managing the promotion of its products

and services and develops appropriate promotional content and marketing methods for its products and services. LAZZEN has

formulated a Dealer Manual that specifies areas of dealership product pricing and sales conditions after-sales service and guar-

antees ensuring that cooperation between the dealers and the Company is conducted on a clear and fair basis. This helps build a

Shuoguang Award - Preferred 2023 Best New Supplier Award stable and win-win dealer network improving market competitiveness and achieving mutual development goals.Partner in Government Pro- of Goldwind In 2024 LAZZEN conducted 25 channel policy briefings covering more than 230 dealers15 LCM system training sessions and 13 of-

curement for Construction fline briefings on performance indicator adjustments.Best Service Award at the 2023 Best Collaboration Award

Inovance Technology Supplier of Hopewind

Conference

Channel Policy Briefings

71 72About This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain

Collective

New Quality Responsibility Full Lifecycle

Sustainable Uniting Hearts

Compliance Toward a Shared Guardianship of

Independent Key

Assurance Performance Indicator

Feedback

Report the Chairman LAZZEN 2024 Production Opportunities New Ecosystem Management Service Governance Vision Community Well-

and

being Statement Table

Index Suggestions

"Insight to Innovation Collaboration for Impact" Series Customer Privacy and Information

In 2024 under the theme "Insight to Innovation Collaboration for Security

Impact" LAZZEN organized 16 nationwide events covering fields

such as smart power distribution intelligent living solutions energy

storage wind power and electrical safety in healthcare facilities. LAZZEN strictly follows relevant laws and regulations such as the Data Security Law and the Cybersecurity Law to strengthen its information security

From Ningbo to Xiamen Beijing to Zhuhai Shanghai to Tianjin and defenses comprehensively. LAZZEN has established an information security management framework covering key areas such as equipment security

the Xiong'an New Area LAZZEN's footprint extended across China. network security data security and both software and hardware security ensuring multi-dimensional protection for information security. The internal

Through brand salons technical seminars product showcases and digital platform is equipped with advanced security permission management functions to precisely implement data access control and permission allo-

executive round tables the Company engaged in in-depth exchang- cation effectively safeguarding data security and privacy. LAZZEN has obtained ISO 27001 Information Security Management System certification.es with industry experts academic institutions and enterprise LAZZEN has established a comprehensive contingency plan for information security emergencies covering critical domains such as network risk assess-

partners. These events focused on sharing cutting-edge practices ments information security training and simulated exercises. We conduct regular network risk assessments systematically identifying and evaluating

in new energy technology applications smart energy systems and potential security threats through Information Security Risk Assessment Forms and Annual Information Security Planning Documents. Based on these

green hospital construction while jointly exploring emerging indus- evaluations risk levels and impact scopes are determined and corresponding response measures are formulated. To reinforce employees' awareness

try trends and technological advancements. Exclusive Smart Energy Roundtable at the Hangzhou Bay Super and technical proficiency we organize mandatory information security training programs aligned with industry best practices. Additionally quarterly

Factory simulated security breach drills are conducted to validate the efficacy of emergency protocols ensuring swift and coordinated responses to incidents.This proactive approach guarantees the secure stable and uninterrupted operation of business-critical systems.LAZZEN has implemented a multi-layered information security control framework incorporating technologies such as aTrust VPN WAF (Web Application

Firewall) situation awareness systems and enterprise-grade antivirus software to comprehensively safeguard data software/hardware networks and

devices. Together these measures form a robust barrier for information security and privacy protection.Data Security: Ensure the security of end-user devices Software and Hardware Security: Implemented en-

devices through Leagsoft's Access Control and Desktop terprise-grade ESCT antivirus software for centralized

Management Systems and Sangfor's Internet Behavior threat detection and removal and utilized Leagsoft's

2024 LAZZEN Partner Summit: "Intelligence & Strategy Management System and establish data backup and UniDesk system to control physical interfaces of termi-

Shared Growth & Success" recovery mechanisms including core business data nal devices preventing unauthorized external device

backup in the headquarters server room an off-site access.

01 disaster recovery data center and regular disaster re- 02

covery drills to ensure high availability and stability of

data.Network Security: Leveraged Sangfor Situation Aware- Infrastructure Resilience: Equipped data centers with

ness System for real-time monitoring and analysis fire suppression systems UPS power supplies and cli-

of internal network threats enabling timely incident mate control systems (constant temperature/humidity)

response to maintain a secure internal environment and implemented strict access controls emergency

and enforced switch ACL policies firewalls and bastion protocols for catastrophic failures and regular drills to

hosts to isolate production zones office zones and guarantee uninterrupted operation of business-critical

LAZZEN Joins as a Council Member of the internet access points ensuring secure access and au- 04 systems.03

Campus Service Development Council (2024) ditability for critical business systems

Multi-layered Information Security Protection System

In 2024

Red Team Penetration Testing at LAZZEN

LAZZEN conducted

Symposium on Hospital Electrical Safety & Smart Fa- To validate the effectiveness of its security defenses LAZZEN conducted Red Team pen-

cility Management Discussing Innovative Solutions to etration testing to identify vulnerabilities and weaknesses in its security infrastructure. This initiative enabled the Company to develop improvement plans and mitigate poten- 3 information security auditsElevate the Smart Healthcare Portfolio tial security risks. Validated through simulated adversarial exercises LAZZEN's security

defense architecture demonstrated the capability to pinpoint attack sources identify

malicious actors and successfully block attack attempts ensuring the security and sta-

bility of business-critical systems.

73 74Supporting of the UN SDGs

06

Sustainable Compliance

Governance

Concept

LAZZEN adheres to the philosophy of sustainable development guided by

Party-building principles strictly complies with laws and regulations and

continuously improves corporate governance mechanisms. The Company

strengthens risk control and compliance management fosters an ethical

work environment and promotes adherence to business ethics among sup-

pliers and distributor partners contributing to a healthy and orderly commer-

cial ecosystem.Our Actions

●?Sustainable Develop- ●?Corporate

ment Management Governance

●?Risk Control ●?Business

and Compliance Ethics

Key Performance

LAZZEN conducted one training session for the newly appointed ESG Com-

mittee

The Company organized 39 investor communication activities

No cases of corruption lawsuits have occurredAbout This Message from About Honors in Digital-Intelligent Supply Chain

Collective

New Quality Climate Change and Building a Green Responsibility Full Lifecycle

Sustainable Uniting Hearts Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Service Compliance Toward a Shared

Guardianship of

Community Well- Assurance Performance

Indicator and

Production Management Governance Vision being Statement Table

Index Suggestions

Sustainable Development Manage- ESG Risk Identification

ment In developing its ESG management framework LAZZEN systematically identifies ESG-related risks and opportunities tied to busi-ness operations. Through risk inventories and materiality assessments the Company clarifies risk impacts and root causes em-

beds ESG risk management into corporate governance and enhances risk mitigation capabilities to ensure timely and effective

responses.Guided by ESG principles LAZZEN remains steadfast on its sustainable development path. It actively enhances communication

and collaboration with stakeholders incorporates diverse perspectives into decision-making and ensures transparency in its sus-

tainability strategies.Stakeholder Communication

ESG Philosophy LAZZEN prioritizes stakeholder rights and demands maintaining close two-way communication and standardizing ESG informa-

tion disclosure processes to address key concerns. By actively incorporating stakeholder feedback the Company integrates sus-

tainability into its operations and strategic planning driving progress toward long-term ESG goals.Aligned with the national carbon peaking and carbon neutrality goals LAZZEN integrates ESG practices into daily operations under

the working guidelines of "Market-Driven Growth Product Leadership Quality & Efficiency Enhancement and Performance Orien-

tation". LAZZEN continuously refines its ESG strategy implements targeted initiatives and strives to maximize environmental and Stakeholder Groups Topics of Interest Related to ESG Engagement and Actions

social contributions while achieving economic value.●?Corporate governance

●?Earning release briefing Improving

Investors and share- ●?Risk management

business performance

ESG Governance Structure holders ●?Information disclosure ●?Enhancing R&D and innovation

●?R&D innovation

LAZZEN has established a three-tier ESG management frame-

work comprising governance management and execution During the reporting period ●?Compliance with laws

layers. During the reporting period the Company restructured ●?Sustainable development ●?Daily communication

Government and

its Sustainability Committee to optimize workflows and ensure LAZZEN conducted one training session for the new- ●?Anti-corruption ●?Legal employmentRegulators

the effective achievement of ESG objectives. ly appointed ESG Committee. ●?Employee rights protection ●?Social welfare

●?Social welfare

●?Product quality

●?Improving product quality

Customers ●?Customer service

●?Timely resolution of customer issues

●?Customer privacy protection

Awards and Honors Awards and Honors

●?Contract compliance in accordance

●?Responsible supply chain management

with laws

Suppliers ●?Stable and secure cooperative relation-

●?Cooperation with integrity

ships

●?Improving systems and policies

●?Employee rights protection

●?Employee Employment

●?Enhancing communication channels

●?Employee career development

Employees ●?Employee training and skill develop-

●?Occupational health

ment

●?Work safety

●?Ensuring work safety

●?Social welfare

●?Green production

●?

China Listed Companies Association Southern Metropolis Daily Community Active communication and engage-●?Community Welfare

ment with the community

2024 Best Practice Case Award for 2024 ESG Innovation

Sustainable Development of Listed Pioneer Enterprise Award ●?Environmental compliance management

Companies ●?Resource management ●?Environmental information disclosure

Environmental ●?Pollutant and waste emission manage- and auditing

ment ●?Green factory

●?Chemical management

2024年公司可持续发展领域所获奖项

77 78Collective

About This Message from About Honors in Digital-Intelligent New Quality Climate Change and Building a Green

Supply Chain Sustainable Uniting Hearts Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Responsibility

Full Lifecycle

Service Compliance Toward a Shared

Guardianship of Assurance Performance Indicator and

Production Management Governance Vision Community Well-being Statement Table

Index Suggestions

Material Issue Analysis Corporate Governance

Based on the results of communication with various stakeholders and the own operational conditions along with excellent industry

cases LAZZEN conducted in-depth research on the Shenzhen Stock Exchange Self-Regulatory Guidelines No. 17 for Companies Listed LAZZEN strictly adheres to laws and regulations to ensure the legal and compliant operation of its corporate governance structure.on Shenzhen Stock Exchange—Sustainability Report (For Trial Implementation) Self-Regulatory Guidelines No. 3 for Companies Listed It places great importance on information disclosure ensuring the authenticity accuracy and timeliness of the information safe-

on Shenzhen Stock Exchange – Sustainability Report Compilation and GRI Sustainability Reporting Standards among other related guarding investors' right to know and communicating with investors through multiple channels to enhance their understanding

regulations. With reference to expert opinions and suggestions the Company ultimately determined material issues matrix for 2024. and trust in the Company. Additionally the Company adheres to the leadership of the Party fully utilizes the political core role of

the Party organization and ensures that the company moves in the right direction of development.●?Conducted a retrospective analysis of the previous year's materiality topic pool by integrating Stock

Identification

exchange regulations industry development trends and company-specific operational performance. Board Structure and Governance

●?Assessed the importance of issues through ongoing stakeholder engagement in daily operations and Organizational Structure

Evaluation centralized questionnaire distribution.●?Collected 113 valid questionnaire responses In accordance with the Company Law Securities Law and other relevant laws and regulations LAZZEN has established an internal

control system for corporate governance centered around the Articles of Association with detailed guidelines such as the General

Matrix ●?Evaluated financial importance and impact importance based on questionnaire feedback expert in- Meeting of Shareholders Rules Board of Directors' Meeting Rules and Board of Supervisors Rules. This structure forms a deci-

Construction sights and industry benchmarks to determine the material issues assessment results. sion-making and operational system with the General Meeting of Shareholders Board of Directors Board of Supervisors and the

management layer as the main bodies.During the reporting period LAZZEN revised certain provisions of the Articles of Association improving governance clauses such as

●?Finalize the 2024 materiality matrix based on the assessment results and disclose it after approval by

Disclosure those for the General Meeting of Shareholders Board of Directors and Board of Supervisors. The Company continually improves

the Board of Directors. its governance structure standardizes operations and enhances the quality of corporate governance providing a favorable man-

agement decision-making environment and strong support for the Company's standardized development.Material Issue Analysis Process

Business During the reporting period21

Ethics 16 Sustainable Supply Chain

15 Employee Employment and Rights LAZZEN organized LAZZEN held

20 Tax Risk 2 General Meeting of Shareholders 10 Board of Directors meetings

05 Climate Change 06 Pollutant Emissions and Waste

Response

LAZZEN organized LAZZEN held

19 ESG Governance 14 R&D Innovation and Intellectual Property

Digital 10 Board of Supervisors meetings 5 Board of Directors Committees meetings18 Corporate Governance 13

Development

11 Occupational Health and Safety 12 Data Security and Customer Privacy

10 Community Welfare

04 Environmental Compliance

Management

03 Energy Use and Resource Utilization

Industry 02 Clean Technology Opportunities08

Collaboration 09 Product Quality and Customer Service

17 Risk Compliance

07 Employee Training and Development 01 Circular Economy

Environmental Impact Importance - Positive Impact

Social

LAZZEN Material Issue Matrix

Corporate Governance

7980

Impact Importance - RiskAbout This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain

Collective

New Quality Responsibility Full Lifecycle

Sustainable Uniting Hearts Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Service Compliance Toward a Shared

Guardianship of

Community Well- Assurance Performance

Indicator

Production Management Governance Vision Statement Table Index

and

being Suggestions

Board of Directors Composition Investor Relations

Investor Engagement

9 Board of Directors

LAZZEN places great importance on engagement with investors always considering the protection of investor rights as an impor-

tant responsibility. To this end we continuously optimize the engagement mechanisms actively expand engagement channels

1 Female Director Awards and Honors and ensure the timeliness accuracy and transparency of information transmission. We enhance engagement with investors and

shareholders through various channels including General Meeting of Shareholders earning briefings roadshows on-site research

and conference calls ensuring the protection of shareholders' engagement and legal rights.

3 Independent Directors

Key Performance Indicators

Investor Exchange Activities Investor Relations Activity Records Earnings Briefings

39 Session(s) 8 Time(s) 3 Time(s)

Board of Supervisors Composition

Interactive Platform Q&A with Investors Telephone Communications On-site Investor Visits & Conference Calls

61Time(s) 60 Time(s) 39 Time(s)

3 Employee Supervisors China Listed Company Association

4A Award for Performance of Board

Secretary

2 Female Supervisors Protection of Small and Medium Investors' Interests

LAZZEN actively communicates with the Shenzhen Stock Exchange's regulatory body to learn regulatory requirements and par-

1 employee supervisor ticipates in seminars organized by the Small and Medium Investors Service Center to learn about listed company operations and

methods for communicating with small and medium investors. Additionally the Company maintains active communication with

small and medium investors through the investor relations interactive platform to ensure smooth communication channels and

Awards Received During the Reporting Period effectively protect the interests of small and medium investors.Awards and Honors Awards and Honors

Information Disclosure

To ensure transparency in company operations and protect the legal rights of share- During the

holders investors partners and the public and to ensure that they fully exercise reporting period

their rights to information we strictly adhere to national laws and regulations and

regulatory requirements upholding principles of integrity and compliance. We dis- LAZZEN made

close information in a timely and compliant manner on designated websites.

110 Panoramic Network Jinmen Finance compliant disclosures Investor Relations Gold Award (2023) 2024 Best Innovative Practice Award

of various announcements in IR Data

Awards for Investor Relations During the Reporting Period

81 82About This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective Independent Key Feedback

Report the Chairman LAZZEN 2024 New Quality Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared

Guardianship of Indicator

Community Well- Assurance Performance Index and Production Management Governance Vision being Statement Table Suggestions

Strengthening the Foundation Through Risk Governance

Party Building LAZZEN has built a "Three Lines of Defense" risk prevention framework establishing a comprehensive and centralized audit su-

pervision network to prevent major risk incidents and support the achievement of strategic goals. During the reporting period

the Company revised the Enterprise Risk Management Framework adjusting the risk management organizational structure and

The Company's Party General Branch Committee consistently centers on core operational tasks fully leveraging the Party organ- responsibilities.ization's role as a fighting fortress and Party members' exemplary role as pioneers and models. By continuously enhancing Par-

ty-building efforts it solidifies a robust political foundation and organizational support for the LAZZEN's sustainable and stable

development.First Line of Defense Second Line of Defense Third Line of Defense

Guided by the general requirements of "studying ideology strengthening Party spirit emphasizing practice and creating new

achievements" LAZZEN formulated an annual study plan organizing in-depth study sessions on Xi Jinping Thought on Socialism ●?Quality and Operations De- ●?Risk Control Department ●?Auditing

with Chinese Characteristics for a New Era and the spirit of the 20th CPC National Congress. Thematic education was carried out partments of each organi- ●?Finance Department

thoroughly including developing implementation plans organizing specialized Party lectures and arranging visits to red educa- zation ●?Quality and Operations

tion bases to elevate Party members' ideological and political qualities and work ethics. Department

In 2024 LAZZEN organized 16 theoretical study sessions and 5 special discussions covering 109 Party members in total."Three Lines of Defense" for Risk Prevention

Risk and Compliance Chairperson of the Risk Management Committee

LAZZEN places high importance on the management of compliance risk and tax striving to establish and improve corresponding Executive Secretary

management frameworks and operational processes to enhance risk prevention capabilities.Compliance Management

LAZZEN closely integrates updates in laws and regulations changes in regulatory requirements and the evolution of the market

environment to timely update compliance management framework documents. This ensures better adaptation to dynamic exter-

nal changes and further improves internal management levels.Regular Mechanism Revision of the Company Law

●?Annual review and update of laws regula- ●?Revise the Company's articles of associa-

tions policies and institutional documents tion and related management frameworks

related to ROHS intellectual property in accordance with the revised Company

information security EHS (Environment Law in 2024.Health and Safety) and energy modules.Risk Management Organization of LAZZEN

Mechanism for Identifying Laws and Regulations with Significant Impact on Operations

Risk Identification and Management

Risk Control LAZZEN continuously identifies risks in key areas and implements risk prevention measures. Through performance evaluations

meeting follow-ups and system processes we ensure the formulation and implementation of risk response measures. Additional-

LAZZEN has established a comprehensive system for identifying analyzing and evaluating risks and opportunities taking corre- ly in accordance with the Basic Standards for Enterprise Internal Control and supporting guidelines we prepare an internal control

sponding measures to strengthen internal controls improve operational management and enhance risk prevention capabilities risk matrix based on actual conditions regularly identifying assessing monitoring responding to and improving risks.thereby promoting sustainable development. We update legal education articles monthly and provide legal and risk management training for new employees to enhance com-

pliance awareness and risk prevention capabilities. This ensures employees are proficient in risk management processes improv-

ing overall risk response levels.

8384

Intellectual Property Committee Member

Financial and Tax Risk Committee Member

Labor Relations Risk Committee Member

Procurement Risk Committee Member

Legal Risk Committee Member

Business Risk Committee Member

Information Security Risk Committee Member

Product Risk Committee MemberAbout This Message from About Honors in Digital-Intelligent

Collective

New Quality Climate Change and Building a Green

Supply Chain Full Lifecycle Sustainable Uniting Hearts Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared

Guardianship of Indicator

Community Well- Assurance Performance and Production Management Governance Vision being Statement Table

Index Suggestions

Internal Audit

●?Conduct pre-assessment of customer creditworthiness payment terms order release and com-

Customer mercial bill acceptance through the Cash Flow Management Committee. During the process busi- LAZZEN has established a risk-oriented audit framework based on business cycles and key operational elements fully utilizing ex-

Payment Risk ness legal and lawyers handle non-litigation collections. Post-event initiate lawsuits to control isting audit resources to inspect key risks in business operations. We have formulated the Internal Audit System and the Departure

risks and reduce bad debt risks. Audit Management Framework. During the reporting period we revised the Internal Audit System adding principles for handling

complaints and reports clarifying approval processes for audit projects introducing special audits and internal investigation work-

flows and updating audit templates.Quality and ●?Regularly hold high-level quality monthly meetings. Assess risks in quality management systems During the reporting period the Audit Department established a "Audit & Business" dual-cycle model on top of the existing audit

RoHS Risk through regulations internal audits and management reviews. cycle promoting the application of audit results and ensuring effective implementation of audit rectifications. This achieves "inte-

gration of business and audit" building a new ecosystem for enterprise risk management.●? For facial recognition expansion in the park issue notices and organize consent agreements. ●?Supervise the compliance of business operations to prevent violations that may cause losses

Information ●?Conduct internal self-inspections and hold Risk Management Committee meetings in response to to corporate assets and reputation.Security Risk software vendors' claims of pirated software usage. Implement resolutions through regulations and

signed documents.●?Evaluate the effectiveness and efficiency of business operations and provide objective impar-

tial reports to the Board of Directors and management.Labor Dispute ●?Conduct background checks on job candidates. Timely update employee handbooks. Properly

●?

Risk handle relocation of Haiyan employees including workplace changes and contract entity updates. Inspect the safety and integrity of corporate assets to reduce unnecessary waste and losses.●?Establish an intellectual property compliance management system to define risk assessment pro- ●?Enhance risk awareness among all employees to minimize potential risks in daily operations.cesses patent risk levels and response strategies. Execute patent risk assessments through the IPD

Intellectual

(Integrated Product Development) process. Annually review the effectiveness of risk control meas-

Property Risk Overall Objectives of the Audit Workures through internal and external audits of the intellectual property compliance management sys-

tem and make timely improvements.Annual Risk Identification Results During the Reporting Period Sales and Receivables Cycle Procurement and Payment Cycle

●?Product Pricing Special Price Management ●? Supplier Management

Credit Limits ●?Procurement Pricing and Allocation Ratios

●?Sales Orders Freight Costs Reverse Logistics ●?Accounts Payable

●?Accounts Receivable Other Receivables

During the

reporting period

LAZZEN experienced no

negative incidents related to Finance (Monetary Funds Cycle) Materials (Production and Inventory Cycle)

risk or compliance. ●?Financial Budgeting ●?Real Estate Production Equipment Office Equip-

●?Monetary Funds Notes Receivable ment

●?Fundraising ●?Inventory Molds Low-Value Consumables

●?Scrap Materials

Human Resources (HR and Payroll Cycle)

Monthly Update Legal Education Articles ●?Production Safety ●?Employee Benefits

●?Payroll Accounting ●?Labor Services

Internal Audit Governance Framework

85 86Digital-Intelligent Supply Chain Sustainable Uniting Hearts Collective About This Message from About Honors in Climate Change and Building a Green Full Lifecycle Guardianship of Independent Key Indicator Feedback

Report the Chairman LAZZEN 2024 New Quality Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared Production Management Governance Vision Community Well-

Assurance Performance

Statement Table Index

and

being Suggestions

Disclosure Item Unit 2022 2023 2024 Business Ethics

Risk/Audit Training Time(s) 1 4 4

Total Employees Covered by Risk/Audit Training Person 200 200 200 LAZZEN upholds a strong sense of social responsibility and professional ethics maintaining a zero-tolerance policy toward corruption

Management Covered by Risk/Audit Training Person 0 50 15 strictly enforcing anti-corruption policies to ensure integrity and transparency in its operations. LAZZEN firmly opposes all forms of mo-

nopolistic behavior and unfair competition adhering to market competition rules and fostering a fair and just business environment.Percentage of Management Covered by Training % 0 100 20

Total Employee Learning Hours Hour(s) 2 2 2 Anti-Corruption

Employees Trained in Compliance Person 250 1500[1] 100

Compliance Training Hours Hour(s) 2 2 2 Anti-Corruption Governance and Strategy

Note: [1]Employee compliance training numbers are for company-wide training in 2023 and management training in other years.LAZZEN strictly follows national anti-corruption and integrity policies by formulating the Integrity and Compliance Management

Measures and establishing a comprehensive integrity management framework. A Sunshine Business Management Committee has

been set up to promote a culture of integrity. Any violations of laws regulations or Company interests are subject to investigation

Tax Management and action to prevent fraud and corruption fostering a healthy business environment and ensuring the stable development. In

2024 LAZZEN revised the Integrity and Compliance Management Code further clarifying ethical conduct standards.

LAZZEN consistently adheres to the principle of tax compliance. To strengthen tax management and ensure lawful operations and Guided by the principles of integrity and self-discipline LAZZEN strengthen anti-corruption measures through institutional devel-

honest tax payment the Company has established the Tax Management Framework. This framework clearly defines the responsi- opment training and supervision aiming to build an ethical and transparent business environment to drive the Company's sus-

bilities and authorities of various departments and personnel in tax management standardizing key processes such as tax registra- tainable growth.tion tax filing invoice usage and management tax planning and archival management. The Sunshine Business Management Committee oversees employee conduct integ-

rity practices and relevant business activities. All employees sign the Integrity and

Compliance Commitment participate in anti-corruption training and adhere to ethi-

Improving Systems and Responding to Policies and cal work practices ensuring that all operations are conducted with transparency.Compliance Building Enhancing Capabilities

During the reporting period LAZZEN organized specialized training on Prevention

●?Established a comprehensive tax man- ●?Continuously monitor and studY national of Commercial Bribery for key internal positions. The training provided insights into

agement framework clarifying manage- tax policies regularly conduct internal tax different forms of commercial bribery and their legal risks continuously enhancing

ment processes and responsibilities and training and promote the deep integra- employees' awareness of anti-corruption measures.conducted dynamic risk assessments to tion of business finance and tax opera-

formulate risk control measures. tions. Optimize tax-related processes and Training on Prevention of Commercial Bribery

●?Adhere to lawful tax payment ensuring enhance the professional capabilities of

the authenticity and completeness of its tax team to achieve rapid adaptation

tax-related documents timely and accu- and compliant implementation of policy

Sunshine Operation Committee

rate tax declaration and payment and changes.strict compliance with tax disclosure

obligations actively cooperating with tax Integrity and Anti-Corruption Management Measures

regulatory authorities.Management

Object Internal External

Leveraging Digital Risk Control to Building Long-Term Mechanisms Employee Handbook Commitment Letter Integrity Cooperation Agreement

Optimize Efficiency ●?Committed to achieving the normali- Control

Measures

●?Utilize digital tools to improve tax trans- zation and standardization of tax risk Training and Promotion

parency and reduce compliance costs. management. Establish a sustainable tax

●?Regularly conduct self-assessments of tax risk prevention and control mechanism

through system improvement techno- OA System: Conflict of Interest Declaration Process Audit Email: Receiving Complaints and Reportsrisks and collaborate with professional Supervision and

consulting firms to strengthen compli- logical empowerment and personnel Inspection

ance reviews ensuring standardized and capability building providing a solid Regular Audits

secure tax operations. foundation for the steady development of

the business. Bottom-Line

Measures Investigation by External Experts

Tax Risk Response Measures Sunshine Operation Management Framework

87 88About This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective Independent Key Feedback

Report the Chairman LAZZEN 2024 New Quality Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared

Guardianship of Indicator

Production Management Governance Vision Community Well-

Assurance Performance Index and

being Statement Table Suggestions

Anti-Corruption Risk Management

LAZZEN continuously strengthens anti-corruption risk management by improving in- ●?Audit Department delivered a ●?Audit Department revised the In- ●?Audit Department conducted a

stitutional frameworks enhancing supervision mechanisms and standardizing busi- keynote speech titled Trans- tegrity Management Guidelines company-wide training and ex-

ness operation processes. Strict disciplinary measures serve as a strong deterrent parent Cooperation Shared defining 3 core principles and 24 amination on the Integrity Man-

establishing a comprehensive Sunshine Business Management Framework that en- Future at the Global Partners specific behavioral standards for agement Guidelines with all

compasses prevention supervision and post-incident handling fostering an organ- Conference communicating ethical conduct. employees signing the Integrity

izational culture where employees "No Unwilling to Corrupt Unable to CorruptNo to all partners the Company's Audit Department organized an Commitment Pledge.●?Courage to Corrupt". commitment to transparent op- "Integrity and Self-Discipline: ●?Audit Department launched

LAZZEN places great importance on complaints and reports establishing strict han- erations and the supplier code Sailing with Integrity" training a Supplier Integrity Self-Dec-

dling procedures with clear response timelines. Additionally a protection mechanism of conduct which emphasizes for mid-level and senior manag- laration and Audit Program

for whistleblowers has been implemented to safeguard their rights. "no gifts no kickbacks no unfair ers culminating in a collective combining voluntary supplier

advantages and zero tolerance Sunshine Business Pledge. disclosures with random audits

Initiative Letter for Integrity During 2024 for violations with accountabili- to detect violations and deter

National Day and Mid-Autumn Festival ty for any breaches." ●?Audit Department issued the

Integrity as the Cornerstone misconduct.●?Risk Control Department organ- Integrity for the Festive Season ●?Audit Department reissued the

ized a specialized training ses- ethical conduct guidelines dur- Integrity as the Cornerstone

sion on Prevention of Commer- ing the Mid-Autumn and Nation- Integrity for the Festive Season

cial Bribery for key personnel al Day holidays. guidelines during the New Year

Unwilling to Corrupt Unable to Corrupt No Courage to Corrupt educating them on the various and Spring Festival holidays.forms of commercial bribery

Integrity Culture Establish Rules Rule of Law Education and the associated legal risks.●?Rule-Setting: clearly define "code of ●?Responsible Body: Sunshine Busi- ●?Integrity Cases Presentation:

conduct red lines" ness Ethics Committee conduct workshops on an- 2024 Anti-Corruption Management Measures

●?Personnel Screening: conduct back- ●?Policy Document: develop Integrity ti-corruption cases and reflec-

ground checks for sensitive positions Management Guidelines tion on economic crime cases

●?Organizational culture: Managers ex- Process Standardization: Replace Legal education: disseminate Complaint and Whistleblowing Timeliness of Complaint and Whistleblowing Handling●? ●?

Pre-Event

emplify integrity individual discretion with pro- integrity case studies and Channels We complete investigations within one month provide feedback

Prevention

●?Training and education: regular in- cess-oriented workflows learn from the experiences of ●?Board of Directors (written or verbal to the Sunshine Business Ethics Committee and the reported indi-

tegrity and legal education ●?Digital Controls: implement IT-driv- economic offenders submissions) vidual(s) and issue the Audit Investigation Report . The maximum

●?Contractual commitments: sign en operations to reduce human ●?Public announcements: inter- duration of the audit investigation shall not exceed three months.●?

Integrity Commitment Letters and intervention nally announce and circulate Email: audit@sh-liangxin.com For complaints and reports that are complex and require high pro-

Integrity Agreements typical cases and organize fessional expertise professional institutions may be engaged to

study sessions conduct external investigations.Voluntary declaration Internal Checks Audit Mechanisms

●?Gifts/Benefits: report gifts/benefits System Alerts: embed data anoma- Audit Checks: regular/unan- Handling of Complaints and Whistleblowing Cases●? ●?

received proactively ly alerts into IT systems nounced audits by Internal

In-Event

●?Conflicts of Interest: disclose con- ●?Departmental reviews: business Audit

Control The Audit Department is obligated to maintain confidentiality regarding the information of complainants and whistleblowers.flicts of interest units conduct self-inspections ●?Executive cngagement: com-

●?Family/Friend Ties: Declare relation- ●?Rotation policy: rotate sensitive mittee members engage part- According to the Internal Audit System any audit personnel who violate confidentiality principles or disclose whistleblower

ships & cooperate with investigations roles periodically ners regularly identities shall be subject to disciplinary actions and penalties.Whistleblower channels Supervision and inspection Penalties & Legal Action

●?Audit mailbox ●?Investigative measures ●?Multi-Level accountability:

●?Complaints to the Sunshine Business ●?Internal investigations: commis- individual managerial and

Post-Event

Ethics Committee sioned by the committee chair leadership accountability

Supervi-

●?External investigations: engage fo- ●?Sanctions: warnings termina-

sion

rensic experts or law enforcement tion fines restitution Information related to complaints/reports We support anonymous complaints and

●?Legal consequences: referral is restricted to a strict need-to-know basis whistleblowing reports which are investi-

to judicial authorities and investigations are conducted confi- gated and handled with the same rigor as

dentially and are not disclosed publicly. real-name reports.Comprehensive Anti-Corruption Management Framework Whistleblower Protection Mechanism

89 90About This Message from About Honors in Digital-Intelligent

Collective

New Quality Climate Change and Building a Green

Supply Chain Full Lifecycle Sustainable Uniting Hearts Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared

Guardianship of

Community Well- Assurance Performance

Indicator and

Production Management Governance Vision being Statement Table

Index Suggestions

Anti-Corruption Management Indicators

During the reporting period

LAZZEN did not have any corruption-related lawsuits.Disclosure Item Unit 2024

Number of corruption lawsuits filed and concluded by regulatory authorities against the issuer

Case(s) 0

or its employees

Number of anti-corruption and anti-bribery whistleblowing reports Case(s) 2

Total number of directors covered by anti-bribery and anti-corruption training Person 5

Percentage of directors covered by anti-bribery and anti-corruption training % 55

Total number of management personnel covered by anti-bribery and anti-corruption training Person 68

Percentage of management personnel covered by anti-bribery and anti-corruption training % 100

Integrity Cooperation Agreement

Total number of employees covered by anti-bribery and anti-corruption training Person 1600

Percentage of employees covered by anti-bribery and anti-corruption training % 80

Anti-Corruption Management for Suppliers and Distributors Anti-Monopoly and Fair Competition

LAZZEN upholds the principles of integrity transparency and openness in cooperation establishing collaborative mechanisms To safeguard a fair and equitable market environment foster orderly market dynamics and promote constructive collaboration

with partners and suppliers while firmly resisting commercial bribery. To ensure compliance and ethical business practices LAZ- between LAZZEN and our partners we are committed to building a healthy and sustainable market ecosystem that lays a robust

ZEN signs Integrity Cooperation Agreements with partners explicitly stating the whistleblowing email address. Periodic inspec- foundation for long-term stability and growth. The contract between the Company and its distributors expressly requires both par-

tions are conducted to reinforce the foundation of mutual trust and integrity. Additionally suppliers are required to participate in ties to adhere to the market maintenance provisions outlined in the Distributor Agreement and the Market Compliance Manage-

anti-bribery training to promote stable and sustainable business development. ment Rules safeguarding orderly market competition.During the

reporting period In 2024

LAZZEN did not report any cor-

ruption-related lawsuits involv- all distributors have signed the updated Distribu-

ing suppliers or distributors. tor Agreement incorporating anti-monopoly and

fair competition provisions.No incidents of monopoly practices or unfair com-

petition violations were reported.Supplier Integrity & Ethical Compliance Declaration Form Market Maintenance Clauses in the Distributor Agreement

91 92Supporting of the UN SDGs

07

Uniting Hearts Toward a

Shared Vision

Concept

LAZZEN strictly adheres to laws and regulations in the employee recruitment

process continuously improving the compensation and benefits system

expanding communication channels for employees and optimizing the pro-

motion and training processes to foster personal growth. We place great em-

phasis on employee welfare actively organizing diverse activities to enhance

employees' sense of belonging and overall happiness. We strictly comply

with national laws and regulations regarding production safety and occupa-

tional health ensuring the effective implementation of safety measures and

improving the efficiency of safety production and occupational health man-

agement.Our Actions

●?Employee ●?Work Safety and

Management Occupational Health

Key Performance

Campus recruitment as a percentage of annual talent hiring 40 %

Average employee satisfaction scores 6.10 points out of 7

Employee work safety investment RMB 1.2432 millionAbout This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective Independent Key Feedback

Report the Chairman LAZZEN 2024 New Quality Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared

Guardianship of Indicator

Community Well- Assurance Performance Index and Production Management Governance Vision being Statement Table Suggestions

Employee Management Disclosure Item Unit 2022 2023 2024

Labor Contract Signing Rate % 100 100 100

LAZZEN strictly adheres to the Labor Law and relevant regulations safeguarding employees' legal rights continuously optimizing Total Number of Employees Person 2270 2594 2355

the compensation system clearly defining employee promotion pathways and training mechanisms facilitating communication Male Person 1528 1735 1637

channels providing a variety of employee benefits and organizing diverse activities. LAZZEN The Company is committed to under- By Gender

standing and addressing employees' needs increasing their satisfaction and sense of belonging. Female Person 742 859 718

Labor contract employees Person 2261 2561 2259

By Employment Type Labor dispatch employees Person 0 0 66

Employee Employment and Rights

Other Person 19 33 30

50 years old and above Person 23 25 25

Employee Employment Governance By Age 30 to 50 years old Person 1514 1692 1697

The company has established the Human Resource Management Policy and related regulations including anti-discrimination 30 years old and below Person 733 877 624

clauses to eliminate unfair treatment. We adhere to the principle of equal pay for equal work strictly prohibit any form of discrim- Employees working in Mainland China Person 2270 2594 2355

ination and resolutely oppose child labor and forced labor thereby safeguarding employees' legal rights and fostering a fair re- By Region

spectful and inclusive workplace. Employees working in Other Countries Person 0 0 0

All full-time employees must sign legally binding labor contracts upon onboarding to ensure standardized and compliant employ- PhD Person 1 3 3

ment management. The internal recruitment and deployment processes follow the principle of "merit-based selection competen-

cy prioritization; mutual consensus seamless transition" to guarantee fairness and operational continuity. We encourage employ- Master Person 109 119 142

ees to recommend suitable candidates with corresponding reward policies. By Education Bachelor Person 1185 1182 1188

In 2024 we implemented clear policies and measures in talent acquisition and talent reserve covering organizational manage- College Person 279 406 348

ment personnel selection performance management and welfare subsidies. The regulations for recruitment-related expenses

reimbursement and new employee training have been further refined. College degree or below Person 696 884 674

Total number of junior employees Person 1998 2332 2116

Employee Employment Strategy Total number of middle management Person 257 246 228During the reporting period

College degree or

Number of female middle management Person 49 46 34

LAZZEN promotes continuous innovation and business growth below

by formulating precise talent acquisition and effective talent Campus recruitment accounted for Total number of senior management Person 15 16 11

management strategies. 40 Number of female senior management Person 1 1 1% of the annual talent hiring.Production personal Person 813 989 888

Technical personal Person 582 787 657

By Employee Profes-

Talent Acquisition Sales personal Person 598 649 586sional Category

●?Attract industry experts through social recruitment Financial personal Person 35 31 24

●?Select outstanding talents from top industry-aligned universities through management train- Management personal Person 242 138 200

ee programs

Foreign employees Person 0 0 0

Minority ethnic group members Person 6 6 6

Talent Mapping

Disabled employees Person 0 0 1

●?Focus on building internal and external talent maps and talent pools systematically manag-

ing and planning talent resources to ensure LAZZEN can continuously attract and retain tal- Veterans Person 0 0 0

ents

New hires Person 269 461 417

Employee Employment Strategy Employee Data

95 96Digital-Intelligent Collective About This Message from About Honors in New Quality Climate Change and Building a Green

Supply Chain Full Lifecycle Sustainable Uniting Hearts Responsibility Compliance Toward a Shared Guardianship of

Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Service Community Well- Assurance Performance

Indicator and

Production Management Governance Vision being Statement Table

Index Suggestions

Financial Assistance for Employees in Need & Flexible Employ- Employee Promotion and Training

ment

LAZZEN provides targeted support for employees facing hardship focusing on both professional and personal well-being. During

the reporting period the labor union implemented the 2024 Spring Festival Relief Program assisting 5 employees in need. Employee Promotion

To address flexible workforce demands we adopted flexible employment models including third-party task delegation and tem- LAZZEN implements a dual-track career development path covering both professional and management positions allowing

porary labor contracts to accommodate varying service durations and create more employment opportunities. employees to make cross-channel promotions between different career paths. The promotion system clearly defines the qualifi-

cations for promotion and requires employees to demonstrate their capabilities and adaptability through a defense session. The

evaluation standards are set based on the requirements of the training academy.Employee Rights Governance LAZZEN also implement a management rotation system for cadres to promote the comprehensive development and experience

accumulation. When employees are promoted to new positions or move across levels they are required to participate in a defense

LAZZEN has developed management framework such as the Performance Management System and the Compensation and Ben- session. The frequency of these promotion defenses can be adjusted flexibly based on actual circumstances. We will continue to

efits Management System to conduct scientific salary management based on employee performance evaluations. The compen- optimize employee promotion channels and management mechanisms in the future providing employees with broader career

sation package includes three components: stock option salary and bonuses to ensure fair and equitable remuneration. A talent development opportunities.incentive and evaluation system are established market-oriented and customer-centered combining cash compensation and em-

ployee stock ownership. The Company continues to manage the sale of reserved shares in the employee stock ownership plan and

performance evaluation. Employee Training

In 2024 LAZZEN optimized the performance evaluation rules for the core team incorporating ESG factors into the performance

appraisal system for executives further refining the management measures for employee compensation and performance to en- Talent Development Center is responsible for planning and managing training activities dedicated to creating a team of internal

hance the efficiency of employee rights management. and external experts as instructors. This center undertakes developing and implementing training courses systematically culti-

vating a high-quality talent pool to support the Company's long-term development goals. Additionally we focus on the training of

reserved talent and continuous development after employees are assigned to new positions ensuring that they can meet new job

Employee Rights Strategy requirements and constantly enhance their skills.Our internal training system is supported by the LAZZEN Training and Development Center which consists of five specialized acad-

LAZZEN implements a refined salary management strategy to cater to the specific needs and contributions of employees in dif- emies each focusing on different functional areas. Training activities are planned and implemented on a monthly and quarterly

ferent business lines. By considering factors such as job responsibilities professional skills work performance and market salary basis with a summary and review at the end of the year. We track the demand for new training programs in real time managing

levels LAZZEN fully stimulates employees' work enthusiasm and creativity promotes the stable development of talent and helps and adjusting them according to the human resources system and specific regulations of each academy.the Company achieve its long-term strategic goals.Democratic Communication

LAZZEN has established a labor union and employee repre-

sentative congress regularly convened Employee Represent- Performance-Driven

ative Congress and implementing an equal consultation and

collective contract framework. Through smooth democratic Pangu Edison Rock Lean Ganjiang

dialogue channels we gather feedback from all employees Academy Academy Academy Academy Academy

and improve the VOS Voice Community to ensure the effective

implementation of democratic management. We also actively

promote the factory affairs disclosure framework strengthen WIN Program Lazzen Talent Training

democratic supervision and legally mediate labor disputes.Channels for employee complaints about salary performance

evaluation management and other issues are provided to 14th Session of the 7th Employee In 2024 LAZZEN collected 226 Internal Trainer Lazzen Course External Resource

ensure the protection of employee rights and create a harmo- Representative Congress employee requests through the Resource Development Resource Library Introduction

nious and stable work environment. VOS Voice Community and com-

pleted 40 suggestions. Online Learning

Platform

Employee Satisfaction

PBC (Personal Business Commitment) + Job Responsibility

In 2024 LAZZEN achieved an average employee satisfaction score of 6.10 out of 7 across seven dimensions including leadership

relationships purpose structure attitude toward change useful mechanisms and rewards. Employee Internal Training System

9798

Lazzen Talent

Development CenterCollective

About This Message from About Honors in Digital-Intelligent New Quality Climate Change and Building a Green

Supply Chain

Responsibility Full Lifecycle

Sustainable Uniting Hearts Guardianship of Independent Key Indicator Feedback

Report the Chairman LAZZEN 2024 Production Opportunities New Ecosystem Management Service

Compliance Toward a Shared Community Well- Assurance Performance Governance Vision Statement Table Index

and

being Suggestions

Disclosure Item Unit 2024 Employee Benefits and Activities

Employee Training Investment RMB'000 2000

LAZZEN values employee benefits and activities and cares about the physical and mental health of its employees. We contribute

to housing provident fund and various social insurance programs including pension insurance basic medical insurance unem-

Total Number of Employees Trained Person 39241 ployment insurance work injury insurance maternity insurance. We also regularly organize comprehensive physical check-ups for

employees ensuring 100% coverage.Number of Training Sessions Number 651 LAZZEN organizes diverse cultural and sports activities and implements comprehensive welfare policies to strengthen employees'

sense of belonging. We also pay attention to the needs of female employees by setting up two Nursing Rooms providing a private

Number of Male Employees Trained Person 29038 warm and convenient space for pregnant and breastfeeding female employees. The rooms are equipped with air purifiers water

By Gender dispensers and small refrigerators reflecting LAZZEN's care for female employees.Number of Female Employees Trained Person 10203

Number of Junior and Middle Management Employees Trained Person 39153 Employee Benefits

By Employee

Category

Number of Senior Management Employees Trained Person 88

●?Social Insurance and Housing Provi- ●?Annual Employee Health Check-ups

dent Fund (Five Insurances and One

Total Training Hours for Employees Hour(s) 47175 ●?Women's Care ProgramsFund)

Employee ●?Financial Assistance and Donations for

●?Shanghai Residency Permit

Total Training Hours for Junior and Middle Management Employees Hour(s) 47032 Benefits Employees in Need

By Employee ●?Subsidies for Club Activities

Category ●?Visits and Support for Sick Employees

Total Training Hours for Senior Management Hour(s) 143 ●?Team Building Expenses

Total Number of Employees Who Received Performance Appraisal or Career Development Employee Benefits

Person 1565

Assessment

New Employee Onboarding Training

During the reporting period in order to help newly hired employees quickly familiarize understand the systems and pro-

cesses LAZZEN organized a comprehensive onboarding training program. Each session of the general training for new

employees covered 16 training courses. A total of 3 sessions were held with 150 employees participating in the training.Employee Birthday Benefits Visit and Care for Retired Employees

2024 LAZZEN WIN24 Management Trainee Onboarding Training Program

Women's Day Activity

99 100About This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective Independent Key Feedback

Report the Chairman LAZZEN 2024 New Quality Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared

Guardianship of Assurance Performance Indicator and

Production Management Governance Vision Community Well- Statement Table Indexbeing Suggestions

Employee Activities Work Production and Occupational

LAZZEN places great importance on humanistic care firmly believing that employees' well-being is inseparable from fostering a

positive efficient and creative team. By actively organizing various activities it enriches employees' cultural life in their spare time Health

and nurtures their spiritual world.Work Safety

Shaoguang Initiative

LAZZEN is committed to establishing and improving standardized work safety processes enhancing the work safety responsibility

system and building smart work safety lines to optimize standardized processes and comprehensively ensure the safety of produc-

During the reporting period LAZZEN invited employees and their families to the Shanghai headquarters and led them tion operations.on a tour of the Hangzhou Bay Super Factory. This allowed employees and their families to experience the technological

power brought by intelligent manufacturing and future factories providing a close-up look at the path of product re-

search development and production. This initiative deepened their understanding of the Company's culture and devel-

opment history. Work Safety Governance

LAZZEN always adheres to the work safety policy of "safety first prevention foremost and comprehensive management". Based

on the Work Safety Law of the People's Republic of China and other relevant regulations a safety committee has been established

with clear responsibilities assigned at each level. The Company promotes standardized work safety processes organizes annual

safety months activities and conducts regular work safety inspections.LAZZEN continuously explores smart work safety production lines integrating ad- Safety Committee

vanced technologies such as digital modeling simulation analysis and the Internet

of Things (IoT) to establish dynamic digital twin virtual factories. We have introduced

several high-precision imported devices fully automated production lines intelligent

Safety Committee Office

Shaoguang Initiative three-dimensional storage equipment and smart inspection equipment to reduce

safety risks faced by employees during production creating a safe digital and intelli-

gent production line.Safety Team

Currently Liangxin Electric Appliances (Haiyan) Co. Ltd. has obtained the Level 3

Work Safety Standardization Certificate (Machinery) and LAZZEN has passed the Lev- Safety Committee Organizational Structure

Snake Dance Welcomes the New Year Charting a New Chapter; Unity in Collaboration el 2 Work Safety Standardization Certificate (Machinery).to Forge a New Landscape

0102

In 2024 the "Opening Ceremony Banquet" celebration Regularly analyze the safety production sit- Develop safety technical measures occupa-

was scheduled for the morning of the eighth day of the uation and determine the guidelines goals tional disease prevention plans annual key

first lunar month. Thousands of employees from the and indicators for safety production and work plans and annual safety budget plans.Shanghai headquarters Hangzhou Bay Super Factory occupational disease prevention.Xi'an Research Institute and national offices gathered to 03 04

embark on a new journey. The event featured speeches Define special funds assessment rewards Guide safety production and occupation-

and penalties for safety production occupa- al disease prevention activities conduct

drum performance a kickoff ceremony the distribution of tional disease prevention and fire emergen- publicity and education summarize safety

red envelopes and other fun-filled activities. cy response; study coordinate and resolve production and occupational health work

major safety production issues; review promote advanced safety production and oc-

With the sound of firecrackers ringing in the air symbol- solutions for major safety hazards and emer- cupational disease prevention technologies

izing prosperity and good fortune Chairman Silong Ren gency rescue plans for production safety and management methods and recognize

Director Ping Chen and senior executives walked into the accidents and improve occupational health commend and reward outstanding depart-

workshop to warmly engage with all employees extend- and safety management and emergency res- ments and individuals in safety production

ing their blessings and greetings. Together with all mem- cue systems. and occupational disease prevention.bers they welcomed the new year with joy and determi- 05 06

nation striving to create new stories and achievements in In accordance with national and local Investigate responsibilities for other safety

the year ahead. government approvals and company reg- production accidents within the company

2024 Opening Ceremony Banquet of LAZZEN ulations propose handling opinions for discuss and decide on the handling of rele-

departments and personnel responsible for vant responsible departments and person-

Work Safety Standardization Certificate major safety production accidents within the nel and assist in major safety production

company. matters.Safety Committee Responsibilities

101 102About This Message from About Honors in Digital-Intelligent Supply Chain Sustainable Uniting Hearts

Collective

Climate Change and Building a Green Full Lifecycle Independent Key Feedback

Report the Chairman LAZZEN 2024 New Quality Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared

Guardianship of

Community Well- Assurance Performance

Indicator and

Production Management Governance Vision being Statement Table

Index Suggestions

Work Safety Risk Management and Emergency Response Plans Disclosure Items Unit 2024

To minimize the potential consequenc- Safety production investment RMB '000 1243.2

es of emergencies LAZZEN regularly

conducts work safety risk assessments. Employee safety production liability insurance investment RMB '000 30

For emergencies such as falls from Number of safety production accidents Case(s) 0

height and mechanical injuries that

may cause personal harm or result in Employee work injury insurance coverage rate % 100

losses for the Company corresponding

emergency preparedness and response Employee safety production liability insurance coverage rate % 100

measures have been developed.Number of work injury accidents Case(s) 5

In light of the irreversible impact on

personnel injuries and property losses Number of employees injured in work accidents Person 5

in emergencies and to improve the

response capabilities of personnel Number of work-related fatalities Case(s) 0

enhance team collaboration LAZZEN

actively organizes specialized training Number of employees who died due to work accidents Person 0

and emergency drills. Specialized train-

ings include forklift safety accident Number of factory buildings certified under occupational health and Number 5

case warning and lectures and training safety management systems

on occupational diseases and hazard Number of employees who received safety training Person 1742

factors. Emergency drills cover various

emergency scenarios such as natural Total hours of safety training received by employees Hour(s) 2613

disasters and public health incidents

focusing on operation coordination Contractors: Number of work injury cases Person 0

and communication skills to compre-

hensively improve the team's ability to Contractors: Number of work-related fatalities Person 0

handle complex situations minimizing

losses and injuries. Additionally we

organize employees to watch safety

accident videos as warnings to prevent Occupational Health

accidents and ensure comprehensive

safety and health during production. LAZZEN places great emphasis on employees' occupational health establishing a comprehensive occupational health manage-

Emergency Training Scene ment framework. We adopt measures such as occupational disease hazard factor detection protective equipment optimization

and occupational health education and training to strengthen the occupational health protection capabilities.In 2024

Occupational Health Governance

LAZZEN conducted 14 safety production training sessions 166 safety production inspections 7 emergency LAZZEN places great importance on the employee safety and health and has formulated various occupational health management

26 documents including the Environmental and Occupational Health Requirements Notice the Occupational Health Exit Physical drills and property fire drills. Examination Waiver Statement and the Environmental Occupational Health and Safety Management System while continuously

updating hazard source identification documents. A well-established occupational health and safety production reporting system

has been put in place. In 2024 the Company developed the Occupational Disease Prevention Management Procedures and the

A total of 17 employees received professional first aid training and obtained Red Cross First Aid Certificates. Safety Inspection and Hazard Identification Management System.To improve the efficiency of occupational health management we have taken multiple optimization measures. In 2024 we en-

hanced the distribution of labor protection supplies installed AED devices shortened the self-check period for safety manage-

ment and regularly organized training on violation case studies.

103 104About This Message from About Honors in Digital-Intelligent Supply Chain

Collective

New Quality Climate Change and Building a Green Responsibility Full Lifecycle

Sustainable Uniting Hearts Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Service Compliance Toward a Shared

Guardianship of Assurance Performance Indicator and

Production Management Governance Vision Community Well- Statement Table Indexbeing Suggestions

In 2024 we implemented employee

health risk management during the on-

boarding process for new employees

requiring all new hires to provide phys-

ical examination reports before joining.The requirements for the reports are

differentiated based on employee lev-

els and age groups.Currently LAZZEN has obtained inter-

national safety system certifications

including ISO45001 and OHSAS 18001.LAZZEN Occupational Health and Safety Management System Certification

Occupational Health Risk Management

LAZZEN actively conducts comprehensive identification of occupational health risk factors and intervenes at an early stage. Based

on the Hazard Source Identification and Risk Assessment Form daily inspections are performed to identify and assess hazardous Hazardous Source Identification and Evalua-

sources in production and business activities. This ensures the timely discovery of potential safety hazards proper record-keeping tion Table

and tracking of improvement status effectively reducing occupational health and safety risks.Risk Type Management Method Specific Measures Occupational Health Indicators and Targets

Occupational Disease Preven- ●?Establish and implement an occupational disease prevention management

tion Management framework according to regulatory requirements No. Occupational Health Management Goals

●?Develop and execute a noise emission management framework to ensure

Noise Emission Management

compliance with relevant standards 1 No more than 1 incident of serious work-related injury (level 4 and above)

●?Establish a labor protection equipment management framework and main-

Safety Produc- tain clear issuance records 2 Zero occurrence of occupational diseases

tion Risk

●?Train personnel in each position to accurately collect record and correctly

Labor Protection Equipment 3 Medical injury rate ≤ 1%

wear protective equipment

Management

●?The EHS department regularly inspects wearing compliance and accurately

records and provides feedback for corrective actions by the responsible de-

partment

Disclosure Item Unit 2024

●?Equipped 6 AEDs (4 in Shanghai 2 in Haiyan)

Emergency Inci- Emergency Equipment and

dent Risk Training ●?Conducted AED practical operation training for key personnel (security staff

Number of Employees in Occupational Disease Risk Positions Person 503

cafeteria staff equipment personnel EHS related person in charge etc.).Number of Employees Participating in Occupational Disease Medi-

●?The EHS department conducts daily on-site safety hazard inspections Person 480

Safety Manage- cal Examination

Safety Hazard Inspections

ment Risk ●?Promptly record hazards and report to the responsible department for rec-

tification within a specified period Number of Employees Diagnosed with Occupational Diseases Person 0

●?Regularly conduct occupational health examinations for employees in haz-

ardous positions Total Number of Employees Participating in Medical Examinations Person 1742

Occupational Health Exam-

Occupational ●?Prohibit employees with contraindications from working in hazardous posi-

inations and Occupational

Health Risk tions and transfer Percentage of Employees Participating in Medical Examinations % 79.2

Health Monitoring

●?Perform regular occupational health monitoring in accordance with regula-

tory requirements

Occupational Health Risk Assessment and Management Measures

105 106SDGs 对标

08

Collective Guardianship

of Community Well-being

Concept

LAZZEN actively participates in industry activities contributing to society

through social welfare and industry collaborations engaging in industry

standard setting and government activities and actively fulfilling its social re-

sponsibilities. We are focused on the well-being of vulnerable groups actively

promoting rural revitalization leveraging our influence on further support

industry transformation and the harmonious development of society.Our Actions

●?Industry ●?Community

Collaboration Welfare

Key Performance

Participated in 12 policy presentations

In 2024 the total charitable donations amounted to RMB 363000About This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective

New Quality Responsibility Compliance Toward a Shared Guardianship of

Independent Key Indicator Feedback

Report the Chairman LAZZEN 2024 Production Opportunities New Ecosystem

Assurance Performance and

Management Service Governance Vision Community Well-being Statement Table

Index Suggestions

Industry Collaboration

LAZZEN actively engages in industry collaboration and university-enterprise cooperation actively participates in industry forums

and government activities attends industry conferences and assists in drafting industry standards promoting knowledge sharing

and technological innovation to propel the progress and development of the industry.Industry Exchange Smart Building Sustainable Development Conference and the Human Meeting on the Low Voltage Circuit Breaker Selection Guidelines for

Habitat Technology and Innovation Forum Wind Power Converters

To promote market activities in various industries and strengthen customer relationships the Company actively organizes and

plans large industry exhibitions academic forums and industry networking events based on the strategic objectives for 2024 to

enhance the influence and market engagement.In 2024 LAZZEN hosted 60 industry market events in total including 11 large-scale exhibitions 24 industry forums and 25 industry

networking salons.Focusing on Green Energy and Exploring Future Mobility

During the reporting period LAZZEN showcased several 2024 Standards Promotion and High-Quality R&D and Standards Senior NEEU Board Meeting

innovative technologies and products at the Shenzhen Training Class Sharing and Exchange

International Charging Pile and Battery Swap Station

Exhibition. The highlights included the DC charging pile

solutions in the charging pile industry the PX distribution

expert under the LAZZEN Magic Link Power smart ener- Industry Associations

gy management platform and EX smart energy carbon.These efforts further enhanced the Company's influence

in the industry. No. Association Name Nature and Participation

1 Shanghai Electric Power Industry Association Member Unit

International Charging Pile and Battery Swap Station Exhibition China Electrical Equipment Industry Association (Gener-

2 Director Unit

al Association)

China Electrical Equipment Industry Association General

3 Deputy Chairman Unit

Low Voltage Electrical Appliances Branch

LAZZEN Showcased at the Energy Storage International Summit and Exhibition ESIE

4 Zigbee Alliance (CSA Alliance) Participant

2024 and Promoting Clean Energy Development

China Electrical Equipment Industry Association Electri-

5 Member Unit

During the reporting period LAZZEN showcased the energy storage system cal Accessories and Home Controllers Branch

component solutions innovations for high-altitude and high-temperature and

high-humidity applications and multiple compact new products at the 2024 En- 6 China Smart Home Industry Alliance Chairman Unit

ergy Storage International Summit and Exhibition aiming at assist customers in

optimizing energy usage and accelerating the development of clean energy and 7 China Survey and Design Association Director Unit

driving the application of energy storage in various scenarios.Architectural Electrical Branch of China Architecture

At the energy supply transmission and distribution ends LAZZEN comprehen- 8 Director UnitSociety

sively demonstrated its layout in large ground-mounted energy storage systems

industrial and commercial energy storage systems and household energy 9 New Energy Electrical Appliances Alliance Deputy Chairman Unit

storage systems providing one-stop safe green and efficient energy storage

solutions to better meet the energy storage needs in industrial and commercial

scenarios and contribute to the global low-carbon energy development. 10 New Energy Storage Industry Association Member Unit

2024 Energy Storage International Sum-

mit and Exhibition

LAZZEN Participates in the Industry Associations (Partial)

109 110About This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain Full Lifecycle Sustainable Uniting Hearts

Collective

Guardianship of Independent Key Indicator Feedback

Report the Chairman LAZZEN 2024 New Quality Production Opportunities New Ecosystem

Responsibility Service Compliance Toward a Shared Management Governance Vision Community Well-

Assurance Performance Index and

being Statement Table Suggestions

Government Activities Community Welfare

LAZZEN actively participates in government activities to ensure that the development is aligned with policies striving for a win-

win situation of both economic benefits and social value. During the reporting period LAZZEN participated in 12 policy promotion

events and 39 government inspections. LAZZEN actively participates in community welfare and rural revitalization activities

establishing strong cooperative relationships with local residents government agen- In 2024

cies and community organizations. We are committed to improving people's liveli-

hoods supporting the vulnerable and aids those in need and promoting the sustain- The total charitable donations

able development of the social economy and achieving the long-term strategic goals. amounted to

In 2024 we participated in the "Heart-to-Heart" and "Charity One-Day Donation"

events contributing to the charitable causes in Haiyan County promoting the spirit 363000 RMB

of charity through concrete actions and advancing charitable culture.

2024 Shanghai Climate Week · Pudong Forum – Green Development 2024 Shanghai Intelligent Manufacturing Development Project Policy Yunnan Honghe Prefecture Livelihood Demonstration Project – Electric Vehicle

and ESG Construction for SMEs Promotion Charging Project

Formulation and Revision of National and During the reporting period LAZZEN took part in the EV charging infrastructure construction project in Honghe Prefecture Yunnan Province contributing to solving local EV charging challenges. The project covers 13 counties and cities in the pre-

Group Standards fecture with 70 charging stations al-ready built and operational and 30

more sites under survey and design

Serial No. Standard Number Standard Name Standard Type awaiting construction. The electric-

ity usage of the charging stations

Low-voltage Switchgear and Controlgear and Their Assem-

1 GB/Z 44074-2024 National Standard is monitored by an intelligent dis-

blies - Environmental Factors tribution platform enabling smart

Low-voltage Switchgear and Controlgear - Part 6-1: Multifunc-

2 GB/T 14048.11-2024 National Standard early warnings quick fault analysis

tional Electrical Converters (Switchgear) and accurate fault location further

Low-voltage Switchgear and Controlgear - Part 6-2: Multifunc- enhancing its convenience for the

3 GB/T 14048.9-2024 tional Electrical Converters - Control and Protection Switch- National Standard public.

gear (CPS)

Low-voltage Switchgear and Controlgear - Part 7-5: Auxiliary Yunnan Honghe Prefecture Electric Vehicle Charging Infrastructure Construction Project

4 GB/Z 14048.24-2024 National Standard

Components - Terminal Blocks for Aluminum Conductors

General Safety Requirements for Residual Current Operated

5 GB/T 6829-2024 National Standard

Protective Devices

Guidelines for Electrical Clearance and Creepage Distances

6 GB/Z 43963-2024 and Solid Insulation Requirements for Equipment with Rated National Standard Tarim Oilfield Power Generation Side Energy Storage Station Project

Voltages Above AC 1000V to 2000V DC 1500V to 3000V

7 24D204-3 Design and Installation of Substations Up to 20kV National Standard In recent years the energy storage industry has flourished with various large-scale energy storage stations being con-

Guidelines for the Selection and Use of Low-voltage Circuit structed on the power generation side to serve as grid charging and backup facilities thereby improving power gen-

8 T/CECS 1574-2024 Group Standard

Breakers eration quality. During the reporting period LAZZEN's

Technical Specifications for Green Design Product Evaluation engineers traveled to Kashgar Xinjiang to participate in

9 T/CEEIA 694-2024 Group Standard

- Conversion Switchgear the Tarim Oilfield Power Generation Side Energy Storage

Station project embarking on a journey of energy storage

Technical Specifications for Green Design Product Evaluation

10 T/CEEIA 693-2024 Group Standard and power distribution in the western region.

- Universal Circuit Breakers

11 T/CEEIA 782-2024 Low-voltage Semiconductor (Solid State) Circuit Breakers Group Standard After completion the energy storage station is expected

Lifecycle Assessment Rules for Low-voltage Electrical Prod- to save around 206000 tons of standard coal equivalent

12 T/CEEIA 783-2024 Group Standard

ucts in clean energy usage reduce carbon dioxide emissions

by 745000 tons and lower carbon emission intensity by

Carbon Footprint Evaluation Guidelines for Electrical Prod-

13 T/CEEIA 784-2024 Group Standard 35.26%.

ucts - Low-voltage Electrical Products Tarim Oilfield Power Generation Side Energy Storage Station Project

14 T/ASC 50-2024 Smart Home Evaluation Standard Group Standard

LAZZEN Participates in the Formulation and Revision of National and Group Standards in 2024

111 112About This Message from About Honors in Digital-Intelligent Climate Change and Building a Green Supply Chain

Collective

New Quality Responsibility Full Lifecycle

Sustainable Uniting Hearts Independent Key Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Compliance Toward a Shared

Guardianship of Assurance Performance Indicator

Production Management Service Governance Vision Community Well- Statement Table Index

and

being Suggestions

Independent Assurance Statement

AA1000 Independent Assurance Statement Assurance Process and Tasks

To collect evidence and form conclusions the primary tasks of REALIZE ESG are summarized as follows:

To the Management and Stakeholders of LAZZEN: ●?Documenting key resource requirements evidence collection tasks activities deliverables and timelines in an assurance plan.Shanghai REALIZE ESG Corporate Services Co. Ltd. (hereinafter referred to as "REALIZE ESG") was commissioned by Shanghai Li- ●?Understanding LAZZEN's overall ESG performance and related processes verifying key organizational developments and policy

angxin Electrical Co. Ltd. (hereinafter referred to as "LAZZEN") to conduct an independent limited assurance on the LAZZEN 2024 implementation and reviewing supporting evidence in the report.Environmental Social and Governance Report (hereinafter referred to as the "ESG Report") and to disclose the assurance results

●?

and conclusions to the readers and stakeholders of the ESG Report through this independent assurance statement. Conducting interviews and reviewing documents to understand LAZZEN's major stakeholders their expectations and needs and

the channels of communication.●?Performing analytical review procedures on the ESG-related information overall performance evaluation and consistency verifi-

Scope of Assurance cation to ensure consistency with the report's content.●?

●?The assurance period is limited to the information and data disclosed in the ESG Report from January 1 2024 to December 31 Verifying the report and process management related to the principles of inclusivity materiality responsiveness and impact in

2024. Any related information outside the reporting period is not within the scope of this assurance. AA1000 to confirm the applicability of this statement.

●?

●?The assurance covers the data and information in the ESG Report related to LAZZEN and its subsidiaries excluding data and in- Conducting sample checks on the reliability and quality of supporting evidence related to selected specific performance informa-

formation from LAZZEN's suppliers partners and other third parties. tion and recalculating the selected specific performance information for verification.●?

We assess the compliance of the ESG Report with the AA1000AS v3 principles of inclusivity materiality responsiveness and im- Performing other procedures deemed necessary by REALIZE ESG.●?

pact as well as the effectiveness and social impact of certain non-financial indicators.●?Information and data that have already been audited or verified by independent third-party organizations are not subject to re- Independence and Verification Capability

peated assurance.●?REALIZE ESG and LAZZEN are completely independent organizations and all members of REALIZE ESG's verification team

have no commercial relationship with LAZZEN that would lead to a conflict of interest. The REALIZE ESG verification team inde-

Assurance Standard pendently conducted this verification.●?

REALIZE ESG adopted Type 2 moderate assurance under AA1000AS v3 which includes evaluating LAZZEN's compliance with the The verification team of REALIZE ESG is composed of experienced ESG professionals who have undergone professional training

four AA1000AS v3 assurance principles: inclusivity materiality responsiveness and impact. on sustainability standards such as the Global Reporting Initiative (GRI) Standards AA1000AS v3 ISO 14001 ISO 9001 ISO 26000

SA 8000 and the EcoVadis global supply chain rating. They possess a comprehensive understanding and practical experience

with international guidelines evaluation systems and verification standards thereby ensuring the capability to conduct the veri-

fication.Sources of Information

●?Report title: LAZZEN 2024 Environmental Social and Governance Report

Limitations

●?Source: LAZZEN

●?The verification process was conducted at the locations within the report's scope. During the process REALIZE ESG adopted a

sampling verification approach for the data and information in the report and only conducted sample interviews with internal

Responsibilities and Statements stakeholders.●?

●?LAZZEN is fully responsible for the preparation and content of the ESG Report. REALIZE ESG's responsibility is to perform assur- Since there are no internationally recognized and universally applicable standards for assessing and measuring non-financial

ance within the scope described and provide professional verification opinions and an independent assurance statement to the data the use of different but acceptable information and measurement techniques may affect comparability with other organiza-

readers and stakeholders of the report. tions.●?

●?Based on the limitations of the assurance scope REALIZE ESG conducted an independent limited assurance on the matters with- The data and information covered in the report are limited to LAZZEN's data and information for the current year while historical

in the defined scope of the ESG Report in accordance with AA1000AS v3. REALIZE ESG assumes no legal or other responsibility for data is not within the scope of this verification.any other inquiries or for any other parties reading this assurance statement.●?Any questions related to this independent assurance statement will be addressed by LAZZEN.

113 114Collective

About This Message from About Honors in Digital-Intelligent Supply Chain Sustainable Uniting Hearts Independent Key Feedback

Report the Chairman LAZZEN 2024 New Quality

Climate Change and Building a Green

Opportunities New Ecosystem Responsibility

Full Lifecycle Compliance Toward a Shared Guardianship of Assurance Performance Indicator and

Production Management Service Governance Vision Community Well- Statement Table Indexbeing Suggestions

Assurance Conclusion Key Performance Table

●?REALIZE ESG did not identify any instances of non-compliance with the principles of inclusivity materiality responsiveness and

impact as outlined in AA1000AP (2018) in LAZZEN's 2024 ESG report. The detailed verification results are as follows:

Economic Performance

Indicator Unit 2024

Inclusivity Total assets RMB 5505921466.47

The report reflects that LAZZEN has implemented the following actions: identifying stakeholders during business op- Net assets RMB 3977356624.49

erations understanding stakeholders' expectations and key concerns communicating in a timely manner on material Revenue RMB 4237866195.50

topics and transparently disclosing the communication outcomes.Net profit attributable to shareholders of the listed

RMB 312113171.51

company

Materiality

Basic earnings per share RMB/share 0.28

LAZZEN collected stakeholder opinions established a materiality analysis process identified ESG topics relevant to Net cash flow from operating activities RMB 456407177.54

the Company and presented the evaluation results.Responsiveness Environmental Performance

LAZZEN responded to the material topics of concern to its key stakeholders and implemented corresponding policies

systems and actions to address stakeholders' concerns.Indicator Unit 2024

Impact Total greenhouse gas emissions tCO2e 19841.75

LAZZEN demonstrated the capability to identify material topics and implemented a balanced and effective evaluation Addressing Climate Scope 1 GHG emissions tCO2e 1125.37

and disclosure approach. The Company has established a systematic process for monitoring measuring evaluating Change

and managing impacts thereby enabling more effective decision-making and outcome management within the or- Scope 2 GHG emissions tCO2e 18716.38

ganization. The report fairly and objectively reflects the impact of material topics. Total emissions of exhaust gas m3 588960000

Particulates kg 2

Gas Pollutant Emis- Total non-methane hydrocarbons kg 991.008

sions Nitrogen oxides kg 0

SOx kg 0

Verification Institution: Shanghai REALIZE ESG

Corporate Services Co. Ltd. VOC Emissions kg 3964.034

Municipal water consumption Ton(s) 141198

Water Resource

Total Volume of Recycled/Reclaimed Water Ton(s) 5016

Lead Verifier: Usage

Total Water Consumption Ton(s) 146214

March 3 2025 Shanghai China Total Energy Consumption Tons of standard coal 3743.39

Natural Gas m3 47831.00

Steam 2272.82

Energy Consump- Electricity MWh 33621.47

tion Direct Energy Consumption Tons of standard coal 63.62

Indirect Energy Consumption Tons of standard coal 3679.77

Energy Use Intensity tce/unit 0.0129

Clean Energy Usage MWh 4705.14

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Compliance Toward a Shared Guardianship of

Independent Key

Assurance Performance Indicator

Feedback

Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Service Community Well- Index and Production Management Governance Vision being Statement Table Suggestions

Indicator Unit 2024 Indicator Unit 2024

Total Wastewater Discharge Ton(s) 4104 Percentage of directors covered by anti-bribery and anti-corrup-

%55

Total Domestic Wastewater Ton(s) 120378 tion training

Chemical oxygen demand (COD) Ton(s) 0.116 Percentage of management personnel covered by anti-bribery

Anti-Corruption % 100

Biochemical oxygen demand (BOD) Ton(s) 0 and anti-corruption training

Water Pollutant

Suspended matter Ton(s) 0

Emissions Percentage of employees covered by anti-bribery and anti-cor- % 80

Ammonia nitrogen Ton(s) 0.002 ruption training

Total nitrogen (TN) Ton(s) 0.026 Investor Exchange Activities Session(s) 39

Total phosphorus (TP) Ton(s) 0.001

Investor Relations Activity Records Time(s) 8

pH - 6-9

Total amount of waste generated Ton(s) 100.512 Earnings Briefings Time(s) 3Investor Relations

Total amount of hazardous waste generated Ton(s) 29.952 Interactive Platform Q&A with Investors Time(s) 61

Total amount of non-hazardous waste gener-

Ton(s) 70.56 Telephone Communications Time(s) 60

Waste Emissions ated

On-site Investor Visits & Conference Calls Time(s) 39

Density of hazardous waste Ton/ RMB 10000 0.00008

Density of non-hazardous waste Ton/ RMB 10000 0.00019

Amount of waste recycled Ton(s) 70.56 Social Performance

Environmental

Environmental investment RMB '000 1700

Investment Indicator Unit 2024

Amount of significant administrative penalties

Environmental imposed by ecological and environmental Amount invested in R&D RMB 10000 32469.74

RMB '000 0

Compliance authorities due to environmental incidents Proportion of R&D investment to main business revenue % 7.66

during the reporting period Number of R&D personnel Number 594

Total number of employees who received Proportion of R&D personnel % 25.22

Environmental Number 2355training

Protection Training Number of invention patents applied to main business oper-

Total training hours for employees Hour(s) 24 Number 348ations

Number of invention patent applications during the report-

Number 127

Corporate Governance Performance ing period

Number of invention patents granted during the reporting

Innovation and R&D Number 207period

Indicator Unit 2024 Number of newly granted patents during the reporting period Number 356

Number of disclosure reports Number 110 Total number of patents held Number 1779

Corporate Govern-

Number of board of directors meetings held Number 10 Total number of copyrights held Number 0

ance Total number of trademarks and text registrations held Number 701

Number of board of supervisors meetings held Number 10

Total number of software copyrights held Number 60

Number of ESG training sessions conducted Number 1

ESG Governance Number of new patent applications filed annually Number 456

Number of employees covered by ESG training % 30 Number of new copyright applications filed annually Number 0

Risk/Audit training Number 4 Customer satisfaction survey results % 93.11

Proportion of labor contracts signed % 100

Risk Compliance Total number of employees covered by risk/audit training Number 200 Total number of employees Number 2355

and Taxation Number of employees receiving compliance training Number 100 Employee Employment Male Number 1637

Total number of employees covered by financial and tax training Number 30 By Gender Female Number 718

Number of concluded corruption litigation cases filed by regula-

Number 0

Anti-Corruption tory authorities against the issuer or its employees

Number of reported anti-corruption and anti-bribery incidents Number 2

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Independent Key Indicator Feedback

Report the Chairman LAZZEN 2024 Production Opportunities New Ecosystem Management Service Governance Vision Community Well-

Assurance Performance

Statement Table Index

and

being Suggestions

Indicator Unit 2024 Indicator Unit 2024

Full-time employee Number 2259 Investment in safety production RMB 10000 124.32

By Employee Type Dispatched employee Number 66 Amount invested in employees' safety production liability

RMB 10000 3

Others Number 30 insurance

50 years old and above Number 25 Number of safety production accidents Number 0

By Age 30 to 50 years old Number 1697 Coverage rate of employees' work-related injury insurance % 100

30 years old and below Number 624 Coverage rate of employees' safety production liability insur- % 100

PhD degree Number 3 anceWork Safety

Master degree Number 142 Number of work-related injury incidents Number 5

Bachelor Number of employees injured in work-related accidents Number 5

Number 1188

By Education degree Number of fatal work-related accidents Number 0

Background Junior college Number of fatalities in work-related accidents Number 0

Number 348

degree Number of factory buildings certified with occupational

Number 5

Junior college health and safety management systems

Number 674

degree and below Number of employees who received safety training Number 1742

Junior level Number 2116 Number of employees in positions with occupational disease

Number 503

Total number of middle manage- risks

Number 228

ment employees Occupational Diseases Number of employees who participated in occupational

Number 480

Employee Employment Number of female employees in health examinationsNumber 34

By Employee Category middle management Number of employees diagnosed with occupational diseases Number 0

Total number of senior manage- Number of employees who participated in company-organ-

Number 11 Number 1742

ment employees ized health examinations

Employee Health Examinations

Number of female employees in Percentage of employees who participated in health exami-

Number 1 % 79.2

senior management nations

Production personnel Number 888 Total number of suppliers Number 272

Technical personnel Number 657 Number of suppliers that have signed integrity clauses % 100

By Function Sales personnel Number 586 Percentage of suppliers with contracts including environ- % 100

mental and labor requirements

Financial personnel Number 24

Number of suppliers that have undergone social impact

Management personnel Number 200 Number 83assessments

Foreign employees Number 0 Number of suppliers that have undergone environmental

Number of ethnic minority employees Number 6 Number 120impact assessments

Number of employees with disabilities Number 1 Number of suppliers certified with ISO 9001 Number 256

Number of demobilized military personnel Number 0 Supply Chain Management Number of suppliers certified with ISO 14001 Number 125

Number of new hires Number 417 Number of suppliers certified with ISO 45001 Number 83

Number of employees assisted through hardship support

Number 5 Number of suppliers identified as having actual and potential

programs Number 0significant negative social impacts

Investment in employee training RMB 10000 200 Number of suppliers identified as having actual and potential

Total number of employees who received training Number 39241 Number 0significant negative environmental impacts

Number of training sessions Number 651

Employee career development Total number of new suppliers Number 15

Total duration of training received by employees Hour(s) 47175 Percentage of locally procured suppliers % 13%

Total number of employees who underwent performance

Number 1565 Number of suppliers with terminated cooperation Number 0

evaluations or career development assessments Amount invested in social welfare initiatives RMB 10000 36.3

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Report the Chairman LAZZEN 2024 New Quality Opportunities New Ecosystem Responsibility Service Compliance Toward a Shared

Guardianship of Indicator

Production Management Governance Vision Community Well-

Assurance Performance Index and

being Statement Table Suggestions

Indicator Index GRI Standards Disclosure Chapter Reference

2-3 Reporting period frequency and contact point About This Report

2-4 Restatements of information About This Report

Indices of Guidelines Topics in Self-Regulatory Guidelines No. 17 2-5 External assurance Independent Assurance State-ment

for Companies Listed on Shenzhen Stock Exchange—Sustainabili- 2-6 Activities value chain and other business relationships About LAZZEN

2-7 Employees Employee Management

ty Report (For Trial Implementation) 2-8 Workers who are not employees Employee Management

2-9 Governance structure and composition Corporate Governance

Dimension No. Topic Clause Chapter Reference 2-10 Nomination and selection of the highest governance body Corporate Governance

1 Climate response Articles 21-28 Addressing Climate Change 2-11 Chair of the highest governance body Refer to 2024 Annual Report

2 Pollutant discharge Article 30 Pollutant Emissions 2-12 Role of the highest governance body in overseeing the man-agement of impacts Corporate Governance

3 Waste disposal Article 31 Waste Disposal Sustainable Development Man-

4 Ecosystem and biodiversity protection Article 32 Environmental Compliance Manage-

2-13 Delegation of responsibility for managing impacts agement

ment

Environment Environmental Compliance Manage- 2-14 Role of the highest governance body in sustainability reporting

Sustainable Development Man-

5 Environmental compliance management Article 33 GRI 2: General agementment Disclosures 2021 2-15 Conflicts of interest Business Ethics

6 Energy utilization Article 35 Energy ManagementClean Technology Opportunities 2-16 Communication of critical concerns Sustainable Development Man-agement

7 Water resources utilization Article 36 Resource Management 2-18 Evaluation of the performance of the highest governance body Refer to 2024 Annual Report

8 Circular economy Article 37 Resource Management 2-19 Remuneration policies Employee Management

9 Rural revitalization Article 39 Community Welfare 2-20 Process to determine remuneration Employee Management

10 Social contributions Article 40 Community Welfare 2-21 Annual total compensation ratio Refer to 2024 Annual Report

11 Innovation Article 42 Innovation-led Growth

12 Ethics of science and technology Article 43 Digital-Intelligent Ecosystem Products 2-22 Statement on sustainable development strategy

Sustainable Development Man-

agement

13 Supply chain security Article 45 Supplier Management

2-26 Mechanisms for seeking advice and raising concerns Sustainable Development Man-

Community agement14 Equal treatment of SMEs Article 46 Corporate GovernanceRefer to 2024 Annual Report 2-27 Compliance with laws and regulations Each Chapter Covers the Topic

15 Product and service safety and quality Article 47 Product Quality 2-28 Membership associations Industry CollaborationCustomer Service

Customer Privacy and Information 2-29 Approach to stakeholder engagement

Sustainable Development

16 Data security and customer privacy Article 48 GovernanceSecurity 2-30 Collective bargaining agreements Employee Management

17 Employees Article 50 Employee Management

Sustainable Development Manage- 3-1 Process to determine material topics

Sustainable Development Man-

18 Due diligence Article 52 GRI 3: Material agementment Topics 2021

3-2 List of material topics Sustainable Development Man-Sustainabili-

19 Stakeholder engagement Article 53 Sustainable Development Manage- agementty-related ment

governance 201-1 Direct economic value generated and distributed Key Performance Table

20 Anti-commercial bribery and anti-corruption Article 55 Business Ethics

201-2 Financial implications and other risks and opportunities due 21 Fair competition Article 56 Business Ethics GRI 201: Economic to climate change Addressing Climate Change

Performance 2016

201-3 Defined benefit plan obligations and other retirement plans Employee Management

201-4 Financial assistance received from government Refer to 2024 Annual Report

GRI Standards (GRI 1: Foundation 2021) GRI Content Index GRI 204: Procure-ment Practices 204-1 Proportion of spending on local suppliers Not Disclosed

2016

205-1 Operations assessed for risks related to corruption Business Ethics

GRI Standards Disclosure Chapter Reference GRI 205: Anti-cor- 205-2 Communication and training about anti-corruption policies About This Report ruption 2016 and procedures Business Ethics

GRI 2: General 2-1 Organizational details About LAZZEN

Disclosures 2021 205-3 Confirmed incidents of corruption and actions taken Business Ethics

2-2 Entities included in the organization's sustainability reporting Refer to 2024 Annual Report GRI 206: Anti-com-

petitive Behavior 206-1 Legal actions for anti-competitive behavior anti-trust and

2016 monopoly practices

Business Ethics

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Report the Chairman LAZZEN 2024 Opportunities New Ecosystem Assurance Performance and Production Management Service Governance Vision Community Well- Indexbeing Statement Table Suggestions

GRI Standards Disclosure Chapter Reference GRI Standards Disclosure Chapter Reference

207-1 Approach to tax Risk and Compliance

GRI 207: Tax 2019 403-3 Occupational health services

Work Production and Occupa-

207-2 Tax governance control and risk management Risk and Compliance tional Health

207-3 Stakeholder engagement and management of concerns relat- 403-4

Worker participation consultation and communication on Work Production and Occupa-

Risk and Compliance

GRI 207: Tax 2019 ed to tax occupational health and safety tional Health

207-4 Country-by-country reporting Not Involved 403-5 Worker training on occupational health and safety Work Production and Occupa-tional Health

301-1 Materials used by weight or volume Not Disclosed

GRI 301: Materials Work Production and Occupa-

2016 301-2 Recycled input materials used Resource Management GRI 403: Occupa-

403-6 Promotion of worker health tional Health

301-3 Reclaimed products and their packaging materials Resource Management tional Health and Safety 2018 403-7 Prevention and mitigation of occupational health and safety Work Production and Occupa-

302-1 Energy consumption within the organization Energy Management impacts directly linked by business relationships tional Health

302-2 Energy consumption outside of the organization Energy Management 403-8 Workers covered by an occupational health and safety man- Work Production and Occupa-

302-3 Energy intensity Energy Management agement system tional Health

GRI 302: Energy Energy Management 403-9 Work-related injuries Work Production and Occupa-

2016 302-4 Reduction of energy consumption Clean Technology Opportuni- tional Health

ties 403-10 Work-related ill health Work Production and Occupa-tional Health

302-5 Reductions in energy requirements of products and services Clean Technology Opportuni-ties 404-1 Average hours of training per year per employee Employee Management

GRI 404: Training Programs for upgrading employee skills and transition assis-

303-1 Interactions with water as a shared resource Resource Management and Education 404-2 Employee ManagementPollutant Emissions tance programs

2016

GRI 303: Water and 303-2 Management of water discharge-related impacts Pollutant Emissions 404-3 Percentage of employees receiving regular performance and Employee Management

Effluents 2018 303-3 Water withdrawal Resource Management career development reviews

303-4 Water discharge Pollutant Emissions GRI 405: Diversity and Equal Oppor- 405-1 Diversity of governance bodies and employees Corporate Governance

303-5 Water consumption Resource Management tunity 2016 Employee Management

GRI 304: Biodiver- Operational sites owned leased managed in or adjacent to 304-1 protected areas and areas of high biodiversity value outside Environmental Compliance

GRI 406: Non-dis-

crimination 2016 406-1 Incidents of discrimination and corrective actions taken Employee Managementsity 2016 protected areas Management GRI 407: Freedom

305-1 Direct (Scope 1) GHG emissions Addressing Climate Change of Association and 407-1 Operations and suppliers in which the right to freedom of

305-2 Energy indirect (Scope 2) GHG emissions Addressing Climate Change Collective Bargain- association and collective bargaining may be at risk

Employee Management

305-3 Other indirect (Scope 3) GHG emissions Not Disclosed ing 2016

GRI 305: Emissions

2016 305-4 GHG emissions intensity Not Disclosed

GRI 408: Child 408-1 Operations and suppliers at significant risk for incidents of Labor 2016 child labor Employee Management

305-5 Reduction of GHG emissions Addressing Climate Change GRI 409: Forced or

Nitrogen oxides (NOx) sulfur oxides (SOx) and other signifi- Compulsory Labor 409-1 Operations and suppliers at significant risk for incidents of 305-7 Employee Managementcant air emissions Pollutant Emissions 2016 forced or compulsory labor

306-1 Waste generation and significant waste-related impacts Waste Disposal 413-1 Operations with local community engagement impact assess-GRI 306: Waste ments and development programs Community Welfare306-2 Management of significant waste-related impacts Waste Disposal GRI 413: Local

2020 Communities 2016

306-3 Waste generated Waste Disposal 413-2 Operations with significant actual and potential negative im-pacts on local communities Not Involved

GRI 306: Waste 306-4 Waste diverted from disposal Waste Disposal GRI 414: Supplier 414-1 New suppliers that were screened using social criteria Green and Sustainable Supply 2020 306-5 Waste directed to disposal Waste Disposal Social Assessment Chain

Green and Sustainable Supply 2016 414-2 Negative social impacts in the supply chain and actions taken Supplier Management

GRI 308: Supplier 308-1 New suppliers that were screened using environmental criteria Chain

Environmental Assessment of the health and safety impacts of product and Product Quality

Assessment 2016 308-2 Negative environmental impacts in the supply chain and ac- Building a Stable and Secure

GRI 416: Customer 416-1 service categories Customer Service

tions taken Supply Chain Health and Safety

Incidents of non-compliance concerning the health and safety Product Quality

401-1 New employee hires and employee turnover Employee Management 2016 416-2 impacts of products and services Customer Service

GRI 401: Employ- 401-2 Benefits provided to full-time employees that are not provided ment 2016 to temporary or part-time employees Employee Management 417-1

Requirements for product and service information and labe- Product Quality

ling Customer Service

401-3 Parental leave Employee Management GRI 417: Marketing 417-2 Incidents of non-compliance concerning product and service Product Quality

GRI 403: Occupa- 403-1 Occupational health and safety management system

Work Production and Occupa- and Labeling 2016 information and labeling Customer Service

tional Health

tional Health and Incidents of non-compliance concerning marketing communi- Product Quality

Safety 2018 403-2 Hazard identification risk assessment and incident investiga- Work Production and Occupa-

417-3 cations Customer Service

tion tional Health GRI 418: Customer

Privacy 2016 418-1

Substantiated complaints concerning breaches of customer Customer Privacy and Informa-

privacy and losses of customer data tion Security

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Assurance Performance Index and

being Statement Table Suggestions

Feedback and Suggestions

Dear Reader

Greetings!

Thank you very much for taking the time and attention to read the LAZZEN 2024 ESG Report. To provide you and

other stakeholders with more valuable information and to effectively enhance the Company's ability and standards

in fulfilling environmental social and corporate governance we sincerely welcome your opinions and suggestions.Multiple-choice questions (Please check in the appropriate box)

1.What's your overall comment on this report

□Excellent □Good □Average □Poor □Bad

2.How does the report respond to and disclose the concerns of stakeholders

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3.How do you think LAZZEN is performing in terms of economic responsibility

□Excellent □Good □Average □Poor □Bad

4.How do you think LAZZEN is performing in terms of environmental responsibility

□Excellent □Good □Average □Poor □Bad

5.How do you think LAZZEN is performing in terms of safety management

□Excellent □Good □Average □Poor □Bad

6.How do you think LAZZEN is performing in terms of employee responsibility

□Excellent □Good □Average □Poor □Bad

7.How do you think LAZZEN is performing in terms of community responsibility

□Excellent □Good □Average □Poor □Bad

8.How clear accurate and comprehensive are the information indicators and data disclosed in this report

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9.Do you find the content arrangement and formatting of this report convenient for reading

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Open-ended questions

Please provide your opinions or suggestions regarding LAZZEN fulfillment of social responsibility and this report.

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