About This Report

Reporting entity

The Reporting entity is "Lu Thai Textile Co. Ltd." which can be referred to as "We" "the Company" "Lu Thai" "Lu Thai

Company" "Lu Thai Textile" "The Group" and "Group" unless otherwise specified in the main text.Scope of the report

The time span of this Report is mainly from January 1 to December 31 2024. In order to maintain the continuity and

comparability of information some content is beyond the aforesaid time span. The information involved is from

the internal data of the Company information submitted by subsidiaries and public information. Unless otherwise

specified all amounts in this Report are expressed in RMB.References

This report has been prepared in accordance with the China Social Compliance 9000 for Textile & Apparel Industry

(CSC9000T) the Self-Regulatory Guidance No. 3 for Companies Listed on Shenzhen Stock Exchange—Preparation of

Sustainability Report and the Self-Regulatory Guidance No. 17 for Companies Listed on Shenzhen Stock Exchange—

Preparation of Sustainability Report(Trial). Additionally it refers to the core plan of the Global Reporting Initiative (GRI)

Sustainability Reporting Standards and the United Nations 2030 Agenda for Sustainable Development (A/RES/70/1).Disclaimer

This Report is released in both Chinese and English. In case of any discrepancies the Chinese version shall prevail.Forward-looking statements included in this Report refer to the statements of the business activities events or

development trends that may happen in the future or will happen soon as predicted or expected by the Company

except for the statements of historical facts. The actual results or development trend may significantly differ from these

forward-looking statements due to variable factors. The Company is not obliged or responsible to update the forward-

looking statements made by the Company in this Report before April 10 2025 unless otherwise required by regulatory

authorities.Access

This report is available for viewing and download on the following websites: http://www.szse.cn (Shenzhen Stock

Exchange); www.lttc.com.cn (Lu Thai Textile); www.cninfo.com.cn (CNINFO).For any inquiries or feedback please contact us via telephone at (+86) 533-5270088 email at sunyi@lttc.com.cn or fax

at (+86) 533-5418805.

1Contents

Chairman's Statement 04 Products and Services Employee's Rights and Benefits/Building a

Building First-Class Products and Services Harmonious Workplace Together

About the Company

R&D and innovation 32 Respect and equality 72

Group profile 07 Quality control 37 Human rights and labor 76

Our culture 07 Customer services and maintenance 38 Talent management 79

Development history 08 Benefits and care 84

Performance review 10

List of honors 12 Production Operations Community Engagement/Striving to Be an

Industry role 13 Responsible Production Operations Outstanding Corporate Citizen

Production safety management 44 Supporting education initiatives 98

ESG Governance

Fire safety management 47 Welfare and charity actions 99

Chemical management 49

ESG governance structure 16

Supply chain management 51

ESG strategy 20

Stakeholder engagement 22 Key Performance Indicators 100

Materiality assessment 23

Risk management 24 Energy Conservation and Environmental Reader Feedback 103

Responsible business conduct 25 Protection/Advancing Green and Low-Carbon

Development

Environmental management indicators 58

achievement

Addressing climate change 59

Resources management 64

Atmospheric pollutant management 68

Waste management 68

Biodiversity protection 69

2 3Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Chairman's Statement Dear friends thank you for your interest in this Report. On behalf of the Board of Directors of Lu Thai Textile I would like to express my

heartfelt gratitude for your long-term support for the Company!

The year 2024 marks our unwavering commitment to the principle of "customer first and pioneering progress." We have focused on

the market customers and products with business objectives as our guiding principle. Taking "customer first" as both the starting

and finishing point of our work we have continuously advanced our key account strategy. While ensuring the stability of traditional

markets we have strengthened our efforts in developing emerging markets. Leveraging the advantages of our integrated industrial

chain and well-structured domestic and international production bases we actively provide customers with integrated fabric and

apparel solutions. We have further optimized our domestic marketing network vigorously expanded the domestic market deepened

our presence in the professional wear sector and proactively explored the women's wear market. Additionally we have continued to

expand our overseas offices and marketing teams to better understand customer needs develop markets sell products and enhance

customer service.The year 2024 captures our innovative practices in "cost reduction efficiency enhancement and coordinated development."

L i u Z i b i n We have continued to advance the Lu Thai Production System improving product delivery and service capabilities while further

strengthening our research and innovation capabilities. Each product line has focused on strategic business goals reinforcing lean

Luthai Textile Co.Ltd management across the entire product realization process under the "profit center" model. Internally we have optimized resources

Chairman President by refining organizational structures sharing resources reducing procurement costs and minimizing quality losses all to enhance

overall operational efficiency. In yarn production we have precisely managed material usage optimized cotton consumption and

dynamically controlled conventional product inventories while continuously improving raw cotton procurement standards. In yarn-

dyed fabric production we have expanded product categories to match market demand ensuring continuous product iteration and

competitiveness. Meanwhile knitted fabrics functional fabrics printed and dyed fabrics and new apparel categories have taken on

the critical role of product portfolio adjustment market expansion and future growth support. By focusing on key challenges and

systematically overcoming them we have unlocked new performance growth drivers for the Company.The year 2024 resonates with our steadfast pursuit of "building independent brands and enhancing brand value." In response

to evolving market dynamics and customer needs we have upheld the "customer first" philosophy continuously enriching our

product portfolio improving quality and cultivating our brand. We have established a globalized system encompassing research and

development design production and marketing in the textile and apparel industry driving our brand internationalization strategy

forward. We have continued to promote independent brand development hosting the 2024 Lu Thai Textile Brand Launch Event and

introducing the "Lu Thai 1987" and online brand "Lu Thai Jianxing." In 2024 Lu Thai ranked among the top in the textile and apparel

industry with a brand strength score of 915 and a brand value of RMB12748 million achieving continuous brand value growth.The year 2024 highlights our strong sense of "focusing on business operations and providing solid support services." With firm

confidence and unwavering determination we have effectively coordinated various aspects of our work. Functional departments have

actively benchmarked best practices to enhance their capabilities and provide strong support for key projects and business operations.We have strengthened the management and operation of our major R&D platform improving the commercial success rate of product

development tasks. We have integrated upstream and downstream supply chain resources to build an efficient globally integrated

supply chain system enhancing supply efficiency. By fostering a people-oriented culture we have accelerated the development of an

international talent team and improved the training and management mechanisms for key positions. Additionally we have reinforced

risk awareness and the concept of safe development improving risk identification and prevention systems to ensure safe operations

and sustainable development.The year 2024 tells a compelling story of "nurturing cultural heritage and fostering collective spirit." On June 8 2024 as we celebrated

the 37th anniversary of our founding we unveiled a new version of our corporate culture philosophy—a blend of tradition and

innovation that aligns with both our current development landscape and future aspirations. A clearly defined mission vision and

set of values have further unified our thinking strengthened our cohesion and ignited our teams’ motivation and passion laying a

solid ideological and cultural foundation for Lu Thai’s next 30 years of growth. We remain deeply committed to our corporate social

responsibility translating our responsibilities and mission into action thereby shaping a corporate image that is both responsible

and compassionate. From organizing vibrant cultural and sports activities such as choir performances football tournaments and

basketball leagues to holding recognition events such as the "Outstanding Employee Awards" and the "Lu Thai Craftsmanship Awards"

we continue to move in harmony with national development and resonate with our employees' growth.With endless mountains and rivers ahead we forge ahead without pause. As we embark on a new journey in 2025 we will continue to

prioritize ESG practices enhance ESG performance and collaborate with our partners to build a sustainable supply chain contributing

Lu Thai’s strength to global sustainable development.April 10 2025

4 5Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

About the Company Group profile

Lu Thai Textile Co. Ltd. founded in 1987 is a global apparel solutions provider with premium fabrics as its core. The Company is one of the

world's leading manufacturers of high-end yarn-dyed fabrics and a key producer of shirts for top international brands. As a dual-listed company

(A-share and B-share) Lu Thai Textile possesses a fully integrated industrial chain that spans textile production dyeing and finishing garment

manufacturing and brand marketing. The Company has established 19 subsidiaries three offices and over 40 production factories across

countries including the United States Italy and Japan making it an integrated innovative and international textile and apparel enterprise

encompassing R&D design manufacturing and marketing services.Currently the Company operates 700000 spindles and 102000 thread spindles with an annual production capacity of 220 million meters of

yarn-dyed fabric 90 million meters of dyed fabric 20 million meters of functional fabric 14000 tons of knitted fabric and 30 million garments.More than 60% of its products are exported to over 60 countries and regions including the United States the European Union and Japan. The

Company holds strategic partnerships with renowned domestic and international brands with its high- and mid-end yarn-dyed fabric exports

accounting for more than 18% of the global market share.Lu Thai Textile is committed to sustainable and environmentally friendly development dedicated to creating eco-friendly textile products for the

world. The Company has consistently maintained a leading position in China's textile industry and has received numerous accolades including

the "National May Day Labor Award" the "China Quality Award" the third "China Grand Awards for Industry" the title of "Manufacturing Single-

item Champion Demonstration Enterprise" recognition as one of the "Top 30 Chinese Printing and Dyeing Enterprises" and the "Outstanding

Contribution Brand Unit" award. In 2023 the Company was listed in the Yicai Corporate Social Responsibility Ranking in China and received the

"ESG Innovation Practice Award."

Since 1995 the Company has obtained certifications for ISO9001 Quality Management System ISO14001 Environmental Management System

ISO45001 Occupational Health and Safety Management System and SA8000 Social Responsibility Management System. Additionally it has fully

implemented the Excellence Performance Management Model with a strong focus on developing the Lu Thai Production System (LTPS). To date

the Company has invested over RMB500 million in social welfare initiatives including poverty alleviation education support student aid elderly

care community assistance and environmental protection.Our culture

Mission: Global Elegance Weaving Excellence Green Manufacturing Better Living

Focusing on the textile industry with fabric and apparel as our core business we provide healthy comfortable and reliable

products through international operations and green intelligent manufacturing serving customers worldwide and fulfilling people’s

aspirations for a better life.Vision: A Global Green Fashion Textile and Apparel Industry Group with Leading Fabric

Excellence

We aim to be a world-class textile and apparel industry group with leading fabric development and manufacturing capabilities a globally

structured presence in marketing R&D design and production and renowned expertise in integrated fabric and apparel services. With

outstanding product quality green fashion leading market share and strong brand influence we strive to set the industry benchmark.Values: Customer First Driven by Hard Work Pursuit of Excellence Integrity and

Win-Win Cooperation

Customer First: Customers are the foundation of the Company’s survival. Meeting customer needs and ensuring customer

satisfaction are our unwavering pursuits and the ultimate standards for evaluating our work. We stay attuned to changes in customer

needs respond quickly innovate operations and provide high-quality products and services to meet customers’ personalized and

diverse needs enhance their experience and achieve customer satisfaction.Driven by Hard Work: To adapt to new circumstances the Company emphasizes the role of hardworking individuals while upholding

a "people-oriented" approach providing a platform for them to realize their value and achieve rapid growth. Resources are directed

toward those who strive ensuring their efforts are recognized so as to achieve common development of the strivers and enterprises.Employees are encouraged to set ambitious goals challenge themselves persevere through difficulties prioritize dedication over

personal comfort take on responsibilities where they are most needed and proactively address challenges to create value for the

Company and its customers.Pursuit of Excellence: Only through continuous pursuit of excellence can we adapt to new circumstances overcome challenges

maintain competitiveness and drive personal and corporate development. There is no "best" only "better." In both conduct and work

we are never satisfied with present success always aiming for world-class standards. We remain open and inclusive embrace change

pursue continuous improvement and foster innovation striving to surpass ourselves our competitors and industry benchmarks and

to pursue excellence in every field and every task.Integrity and Win-Win Cooperation: Integrity is the foundation of survival and win-win cooperation is the path to development. In

partnerships we adhere to business ethics remain honest and trustworthy fulfill stakeholder needs and create value for all parties.By fostering stable trusting and mutually beneficial relationships we unite strengths to achieve greater success and share the fruits of

development.

6 7Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Development history

The Company was recognized as a "Five-starred Chinese Industrial

Enterprise in the Performance of Corporate Social Responsibilities".The "set of technologies and equipment for automatic digital

cheese dyeing" jointly developed based on the "industry-university-

research-application" cooperation was granted the First Prize of the

State Scientific and Technological Progress Award.Zibo No. 7 Cotton

Mill Lu Thai's The Company started The strategic cooperation project of

predecessor was The Lu Thai Textile its new 30-year voyage. Lu Thai Textile and Xiniu Intelligent

established. Lu Thai became A-share listed. Fabric Museum Manufacturing was initiated.Beijing Sichuang Apparels Co. A high-level forum on and the Lu Thai

Ltd. was opened. the theme "Gather the Lu Thai Textile Company was Development Top Wisdom of the

opened formally. The Company was recognized as a Museum were Industry Plan Lu Thai's

National Yarn-dyed Fabric Product opened. The Lu Thai

The Company Future Development" R&D Base. Industrial Design was held to plan the

It passed the passed the The Zichuan Urban Sewage Summit was held.ISO9001 Quality ISO14001 Treatment Plant invested by the

development vision for The construction of The inauguration ceremony for

Management Environmental Company was put into operation.the next three decades. the Functional Fabric new projects at Lu Thai Group's

System Management The Lu Thai Sports Square was Lu Thai Milan Office

The Company was Intelligent Ecological overseas production base was

Certification. System put into use. was opened.recognized as a Park Project began. held.Certification. The Company was "National Industrial The construction of Lu Thai Textile was listed on

Ranguang Textile Lu Thai School granted the "China Design Center" making the Lu Thai knitting the 2023 Yicai Corporate Social

Co. Ltd. was of Textile and Quality Award". it the first enterprise to project began and Responsibility Ranking in China

acquired. Apparel Shandong win this honor in Zibo and won the "ESG Innovation

Lu Thai Group was Phase I was put into University of City.incorporated. production.Practice Award"

Technology was The water reuse project

1987 The Company founded. was completed.

1990 1995 1998 passed the SA8000 Social

Responsibility

Management 2021

System

20042017

20192023

1999 Certification. 2015

199320132020

19881997

2000

20102024

2005200620082022

2012201420162018

Lu Thai Textile Beijing Lu Thai Lu Thai issued RMB1.4

Company was Shirt Co. Ltd. was billion of convertible

restricted into a joint- established. 2007 2009 bonds.A grand ceremony

stock enterprise with was held because Lu Thai (America) The unveiling

The Phase I project of

foreign investment Lu Thai became the Phase II project Textile Co. Ltd. was ceremony of

the Functional Fabric

and renamed Lu Thai B-share listed. LuFeng Company of LuFeng Company opened. the Company's

Intelligent Ecological Lu Thai Textile released

Textile Co. Ltd. Yunjinchuan 2003 The Company academician Park was put into "LUTHAI 1987" and " Limited was

Clothing Co. Ltd. Limited was put into established. production. won the "Global workstation was

production. Luthai Lite Collection"

was acquired. Lu Thai was Performance held in the West The project of colored online brandThe Company

Lu Thai Textile Company a recognized as a won the title Excellence Award". District Industrial

spun yarns was put

China-Thailand joint venture "Stated-accredited into production.Enterprise "China Advanced

The Company Park

was incorporated. Enterprise with was granted The Company Technology Center" the third "China successfully

by five departments an Excellent

including Performance Model

Grand Awards for passed the on- The unveiling ceremony of the

The Company passed (2012)". Industry". site accreditation "Zichuan District Aesthetic

the OHSAS18001 the National of demonstration Education Practice Base" at Lu Thai

Occupational Health Development and enterprises in the Lu Thai's operating Vocational Training School was

and Safety Management Reform Commission The Lu Thai Textile and Apparel Engineering Research textile industry and the Ministry revenue exceeded

held.System Certification. Institute was founded. for energy-saving RMB10 billion a new

Lu Thai Textile was included on

Zibo Luqun Textile Co. of Science and and emission start of the new 30- the list of the First China Industry Technology. The Company was granted the Second Prize of the State Ltd. was established. Carbon Peaking "Leaders" Scientific and Technological Progress Award for its key reduction year voyage. (enterprises).processing technology of ultra-high count pure cotton technology

fabrics and its industrialization high-flux films for printing application

and dyeing wastewater and recycling technology.

8 9Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Performance review

Net profit attributable to shareholders of Total payments to employees including salaries bonuses allowances benefits housing

the Company provident fund and social insurance

Economic

performance 410 Million 1607 Million

Taxes contributed to the state Social contribution value per share Cash dividends distributed over

the past three years

355 Million 3.1 RMB/share 397 Million

Proportion of R&D personnel to Donations to society and

total employees government

12.8 % 2970400 RMB Social

performance

R&D investment and its percentage of

revenue Investment in education support

3.39 % 1594600 RMB

Own brands: LT·GRFF Lu Thai Lu Thai 1987 Luthai Lite Collection NARCISU and so on.Own brands sales 6235100 RMB

10 11Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

List of honors

2023 "Digital 2023 "Top 100 Most

2023-2024 " China’s

Transformation and Attractive Private

Great Textile Craftsman" Innovation Unit" in Enterprises for University

and "Most Beautiful Shandong Province's textile Graduates" in Shandong

Textile Worker" and apparel industry Province

China National Textile & Apparel Council Shandong Textile and Apparel Association Human Resources and Social Security Key Technologies and Industrialization Key Technologies and Industrialization of "2024 China Textile and Apparel Brand

China Finance Trade Light Industry Department of Shandong Province of Structural Design and Preparation for Efficient Green and Fashionable Online Competitiveness Advantage Enterprise"

Textile and Tobacco Trade Union and the Thermal and Moisture Comfort Functional Dyeing – First Prize for Scientific and

Women's Workers Department of the All- Textiles – Second Prize for Scientific and Technological Progress

China Federation of Trade Unions Technological Progress

Industry role

"2024 China Textile "Shandong Province May "Continuous Innovation

and Apparel Brand Fourth Red Flag Youth Unit" in the Top Ten

Competitiveness League Committee" Categories of Textile

Advantage Enterprise" Industry Organizations Role of the Companyhonorary title Innovation Products

China Chamber of Commerce for Import and Export of Textiles The 7th Vice Chairman Organization

China National Textile and Apparel Council Shandong Provincial Committee of the China Textile Information Center

Communist Youth League China Dyeing and Printing Association The 7th Vice Chairman Organization Specially Invited

China National Garment Association The 8th Vice Chairman Organization

Key Technologies and One of the first enterprises

Industrialization of Structural

Key Technologies and nationwide to be certified

Design and Preparation China Textile Engineering Society The 26th Standing Director Organization

for Thermal and Moisture Industrialization of as a "5A Enterprise

Comfort Functional Textiles – Efficient Green and in Corporate Culture

Second Prize for Scientific and Fashionable Online Dyeing Development and China National Textile and Apparel Council The 5th Vice Chairman Organization Specially Invited

Technological Progress Management"

China Textile Enterprise Association The 10th Vice Chairman Organization

China National Textile and Apparel Council China National Textile and Apparel Council China Corporate Culture Institute

Chinese Association for Textile Enterprises Culture Construction The 5th Vice Chairman Organization Specially Invited

China Corporate Culture Institute The Vice Chairman Organization

Silver Award in the

Fashion Product Category Advanced Collective 2024 "Outstanding China Cotton Textile Association The 6th Vice Chairman Organization

at the 5th "Governor’s in the "Five Zibo" Contribution Enterprise

Cup" Industrial Design Development Initiative for Stable Economic

Competition Growth" China Council for Brand Development Standing Director Organization

China Association for Quality Member

Department of Industry and Information Zibo Municipal People's Government Zibo Municipal People's Government

Technology of Shandong Province

Shandong Textile and Apparel Association Rotating Chairman Organization

Shandong Council for Brand Development Standing Director Organization

12 13ESG Governance

Lu Thai Textile continues to enhance its ESG governance mechanism optimizing its governance

structure to ensure scientific and effective decision-making. The Company actively implements

environmental social and governance initiatives integrating ESG systematically into daily

operations to comprehensively support high-quality corporate operations and achieve

sustainable and healthy development.Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Organizational Chart

ESG governance structure

Shareholders

The Board of Directors is responsible for reviewing the Group's Meeting

Decision- Board of overall ESG strategy and reports as well as assuming ultimate

making Level Directors responsibility for the Group's overall direction strategy objectives

and performance in sustainable development.Board of Supervisors

The Board of Supervisors monitors the Group’s ESG policies

Supervisory Board of framework management approach and implementation status Board of Directors

Level Supervisors providing recommendations for improvement to the Board of

Directors.Board of Directors'

Special Committee

*Formulating the Group’s ESG objectives strategy and work

plans and submitting them to the Board of Directors for approval.*Identifying monitoring and reviewing potential ESG issues President

risks and opportunities that may impact the Group’s business

ESG Steering operations and submitting them to the Board of Directors for

Management Group approval

Level President *Prioritizing relevant ESG issues risks and opportunities analyzing

Department their potential impact on business operations and identifying key

heads ESG issues risks and opportunities.*Preparing and reviewing the annual ESG report and other ESG-

related disclosures.*Handling other ESG matters deemed necessary by the ESG Steering Senior

Grou Management

*Collecting and organizing materials for ESG reports.*Providing ESG feedback and recommendations within their

Execution All respective departments.Level departments *Implementing sustainable development policies and initiatives

assigned to them.*Integrating and evaluating ESG risks or opportunities identified

within their operations.Wholly-owned Majority-owned Branch companies Functional

Production l ines

subsidiaries subsidiaries and offices departments

Governance structure

The Company continuously improves the basic governance structure composed of the General Meeting of Shareholders the Board of Directors

the Board of Supervisors and the Senior Management whose rights and responsibilities are defined in accordance with the Company Law the

Securities Law the Code of Corporate Governance for Listed Companies in China the Guidelines No.1 of the Shenzhen Stock Exchange on the

Self-regulation of Listed Companies - Standardized Operation of the Companies Listed on the Mainboard and other relevant laws regulations

and regulatory documents in order to ensure efficient and standardized operations.The Board of Directors performs its duties in strict accordance with the Articles of Association and the Rules of Procedure of the Board

of Directors. The Board of Directors has established the Strategy Committee the Audit Committee the Nomination Committee and the

Remuneration Committee. These special committees make full use of their expertise to make scientific decisions on the Company's

development issues.

16 17Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Committee Name Main Responsibilities Functioning of Committee

The Company's Board of Directors consists of 12 directors including four independent directors four female directors and three foreign

directors. In 2024 the Company held ten board meetings achieving a 100% attendance rate. During the Reporting Period 43 resolutions were

Chairman: Liu Zibin reviewed and approved covering topics such as related-party transactions equity incentive unlocking policy revisions periodic reports profit

Conduct feasible study on the Company's distribution share repurchases and ESG materiality issues.Members: Xu Zhinan Liu Deming Xu

long-term strategic development plans and

Strategy Jianlv Zheng Huisheng Zhang Zhanqi major investment decisions determine the Zhang Keming Du Lixin Zhou Zhiji Qu

Committee Company's development plans improve Dongmei Peng Yanli and Quan Yuhua. Chinese directors

investment decision-making process enhance In 2024 the Committee held one Male directors

scientific decision-making and improve the Female directors Foreign directors

quality and effectiveness of major investment meeting with a full attendance rate of the

decision. members.

33%25%

67%

75%

Chairman: Qu Dongmei

Study and formulate the criteria and

procedures for selection of the Company's Members: Liu Zibin Xu Zhinan Zhou Zhiji

Nomination directors and senior management optimize and Peng Yanli

Committee the structures of the Board of Directors and In 2024 the Committee held two

the management and improve corporate meetings with a full attendance rate of

governance structure. the members.Date of Service

Name of Director Gender Age Position(s)

Commencement

Liu Zibin Male 60 Chairman and President June 6 2007

Chairman: Peng Yanli Xu Zhinan Male 95 Vice Chairman May 6 2004

Formulate and review remuneration policies

and plans formulate and implement Members: Liu Zibin Zhou Zhiji and Qu Liu Deming Male 35 Director May 12 2017

Compensation assessment and evaluation criteria improve Dongmei

Committee the assessment and evaluation system Xu Jianlv Female 50 Director June 10 2022

for the Company's directors and senior In 2024 the Committee held two

management and formulate scientific meetings with a full attendance rate of

effective remuneration management policies. the members.Zheng Huisheng Male 37 Director June 10 2022

Zhang Zhanqi Male 53 Director and Vice President June 10 2022

Zhang Keming Male 57 Director and Chief Accountant June 10 2022

Du Lixin Male 50 Director and Chief Engineer June 10 2022

Chairman: Zhou Zhiji

Responsible for the communication

supervision and review of the Company's Independent DirectorMembers: Liu Deming and Qu Dongmei Zhou Zhiji Male 62 March 10 2019

Audit Committee internal and external audits strengthen the Board's effective oversight of the management In 2024 the Committee held six meetings Qu Dongmei Female 56 Independent Director June 10 2019

enhance internal control capabilities and with a full attendance rate of the

improve internal control policies. members. Peng Yanli Female 64 Independent Director June 10 2022

Quan Yuhua Female 69 Independent Director June 10 2022

Board development

Lu Thai Textile places great importance on board development continuously improving its structure and functions. The Company ensures the

effective operation of board committees emphasizes the independence and diversity of board composition and actively conducts training

for board members and management. The responsibilities of board members are assigned based on their professional experience to ensure

efficient board operations and scientific decision-making thereby enhancing the overall management level and operational efficiency of the

Company.

18 19Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

A company's sustainable development management shows the responsibility and respect of the company for its customers employees

ESG strategy products and future. For many years Lu Thai has kept pace with international and domestic development trends for years. By vigorously

responding to national and industry policies Continental Group has demonstrated its sustainable development through actions.

2022-2026 ESG Strategic Goal: Achieve an industry-leading level of green low-carbon environmentally friendly and sustainable development.

Aligned with the United Nations' 17 Sustainable Development Goals (SDGs):

Prior to the launch of a new project Continental Group has

entrusted environmental assessment agencies to conduct

environmental assessment including the assessment of

the influence on local biodiversity. Protect restore and promote sustainable use of terrestrial The Company includes health safety and environmental

In the meantime it earnestly performs greening ecosystems sustainably manage forests combat Promote peaceful and inclusive societies for sustainable requirements in the bidding invitation requirements for

governance holds activities on Arbor Day and enhances desertification and halt and reverse land degradation development provide access to justice for all and build effective accountable and inclusive institutions at all levels. suppliers thus indirectly urging suppliers and contractors employees' awareness of environmental protection. and halt biodiversity loss. to enhance safety and environmental protection.Conserve and sustainably use the oceans The Company has actively participated in industry

Conserve and sustainably use the oceans seas and marine seas and marine resources for sustainable Strengthen the means of implementation and revitalize organizations and initiatives joined multiple industry

resources for sustainable development. 陆地生物 和平、正义与development. the Global Partnership for Sustainable Development. associations earnestly conducted industry exchanges 强大机构 and promoted industry development.水下生物促进目标实现的伙伴关系

Lu Thai Textile has responded to the 2030 "carbon The Company has actively paid taxes to the governments

peak" and 2060 "carbon neutrality" goals by actively Take urgent action to combat End poverty in all its forms of countries where it operates to promote the economic

carrying out climate action plans. climate change and its impacts. everywhere. development of the surrounding communities.无贫穷气候行动

Reports have been released regularly and ESG-related

information is actively disclosed to enhance transparency.Meanwhile the Company has updated the requirements End hunger achieve food The Company has implemented the policy of local Ensure sustainable

for suppliers and implemented stricter standards of duty 零饥饿 security improved nutrition employment and provided regionally competitive consumption and

performance for suppliers. It has worked with suppliers 负责任 and promote sustainable remuneration and benefits.production patterns.and contractors to actively perform duties to improve 消费和生产 agriculture. Provide a comfortable and safe working environment ensuring

the industrial chain environment and drive social employee safety and health. During the pandemic no cluster

responsibility practice. infections occurred among Company employees.良好健康与 The Company properly prevented and treated occupational

Diverse assistance activities have been conducted in 福祉Make cities and human 可持续 Ensure healthy lives and diseases. Besides the Company has established and improved economically backward villages. Lu Thai Textile has 城市和社区 employees' profiles of occupational health and organized

purchased agricultural products from local farmers and settlements inclusive safe promote well-being for annual check-ups to protect the physical and mental health of

donated daily necessities to residents to improve their resilient and sustainable. all at all ages. employees.living conditions.优质教育 The Company has improved its employee education

减少不平等 and training mechanism. In 2024 23988 employees

Ensure inclusive and equitable participated in vocational training achieving a 100%

The Company has established plants in overseas Reduce inequality within and quality education and promote vocational training coverage rate.developing countries and actively created job among countries. lifelong opportunities for all. The Company organizes activities to support students

opportunities to develop local economies.产业、创新和 性别平等 every fall by providing employees' children with

基础建设 scholarships. It also donates educational funds to society

to cultivate textile talent.In 2024 Lu Thai invested RMB 207Millon in research funds 体面的工作和 清洁饮水和

in total. Additionally it has been granted 548 patents in Build resilient infrastructure promote inclusive 经济增长 卫生设施 The principle of gender equality has been observed. The

total including eight software copyrights. Lu Thai has and sustainable industrialization and foster Achieve gender equality and empower all Labor Union has earnestly protected female employees 经济适用的

organized or participated in the formulation of 75 national innovation. women and girls.清洁能源 and improved their competence.and industry standards. An equal remuneration system has been developed to

ensure equal pay for equal work between male and female

employees.Promote sustained inclusive and sustainable

By performing the digital and intelligent transformation of economic growth full and productive Ensure availability and sustainable management of

production lines Lu Thai has reduced labor intensity and Production departments have been encouraged to employment and decent work for all. water and sanitation for all.raised resource utilization efficiency. propose new measures to save water. The Company has increased investment in reclaimed water reuse projects

further promoting recycled use of water resources and

providing a long-term guarantee for social development.Ensure access to affordable reliable

sustainable and modern energy for all.The Company has conducted the project of rooftop

photovoltaic power generation to contribute to the

energy transformation of enterprises and society.

20 21Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Stakeholder engagement We place great importance on maintaining effective communication with internal and external stakeholders. By establishing a regular communication mechanism we promptly understand stakeholders’ concerns and continuously optimize communication channels to actively

respond to their interests. This approach ensures the orderly progress of the Company's sustainable development initiatives.Stakeholders Issues of Concern Means of Communication Actions of Lu Thai Textile

Operation in Strictly complying with laws and

Compliance Supervision and regulations Materiality assessment

Safe and Green inspection Actively responding to environmental

Production Visits calls and formulating action plans

Fulfillment of Social Material providing Helping the poor and improving people's As part of our stakeholder engagement policy we conduct periodic ESG materiality assessments. This year with the assistance of external

Government Responsibilities livelihoods experts we carried out a materiality analysis in accordance with the guidance provided by the Self-Regulatory Guidance No. 3 for Companies Supporting the public welfare Listed on Shenzhen Stock Exchange—Preparation of Sustainability Report and the Self-Regulatory Guidance No. 17 for Companies Listed on

Shenzhen Stock Exchange—Preparation of Sustainability Report(Trial) issued by the Shenzhen Stock Exchange. Through this process we

Customer visits Improving the product quality management identified material issues that significantly impact both the Company and stakeholders determining the most critical issues for our business Product Quality Customer service and stakeholders while providing insights for the Group’s ESG reporting and strategy.Responsible Marketing systemhotline

Integrity Improving the customer relationship Opening business

Respecting Customers' management systemoperations Conducting the customer satisfaction survey

Customers Opinions Satisfaction survey Visiting customers regularly

Materiality Assessment Process

Corporate Governance Shareholders Meeting

and Profitability On-site survey

Compliant operations openness and 1 ESG Issue Library Creation:

Telephone consulting transparencyHonest and Compliant Interaction Easy of the Safeguarding the legitimate rights and Operations Referring to the materiality issue distribution guidance from the Self-Regulatory Guidance No. 3 for Companies Listed on Shenzhen

Competitive Edge Shenzhen Stock Exchange

interests of shareholders by laws Stock Exchange—Preparation of Sustainability Report and the Self-Regulatory Guidance No. 17 for Companies Listed on Shenzhen Stock

Shareholders and Exchange—Preparation of Sustainability Report(Trial) we established the 2024 ESG issue library after a comprehensive evaluation

investors considering the Company’s overall business development in 2024 and best ESG management practices within the industry.Require suppliers to sign a quality

Product Quality Supplier audits statement

Product Safety and On-site Require chemical product suppliers 2 Formulation and Implementation of Stakeholder Engagement Plan：

Environmental communication to provide relevant qualification

Compliance Telephone and email certificates and sign an environmental By focusing on trends in the textile industry and broader socio-economic developments we engaged with key stakeholders during the

Corporate Compliance communication compliance statement Reporting Period through communication and surveys to gather their opinions and suggestions.Suppliers Operations Conduct regular on-site supplier audits and communications

Improving the remuneration

Respecting Human Rights management system 3 Quantitative Assessment of ESG Material Issues：

Remuneration and The Labor Union and the Improving employee cultivation and

Benefits employee representative promotion mechanisms Internal and external stakeholders were invited to evaluate the materiality of various ESG issues and a materiality matrix was developed.Career Development assembly Diverse communication channels The Company conducted a survey inviting stakeholders from different categories to rate the materiality of Lu Thai’s 2024 ESG issues on

Channels Employee complaint Helping for employees in need a scale of one to five with higher scores indicating greater materiality. After the survey the Company analyzed the feedback and assessed

Employees Health and Safe Satisfaction survey Establish a comprehensive complaint each issue’s materiality based on two dimensions: "materiality to corporate development" and "materiality to stakeholders." This Production mechanism and channels analysis resulted in the ESG materiality matrix for the year. The survey covered a wide range of stakeholders including board members

senior and mid-level management employees customers investors suppliers and government regulators.Exchange visits among senior Continuously improving supplier

management personnel management procedures and strengthening the control of operational risks

Green and Low-carbon Exchange and cooperation in Strengthening contract management and

Development experience and technology standardizing credible procurement

Honest and Compliant Daily communication Sharing experience and technology and

exchanging needed goods 4 Review and Approval of the Materiality Assessment Report：Operations Exchange through industry

Value chain partners conferences Building industry-university-research platforms The materiality assessment report was submitted to the management for review and approval before the results were published.A Harmonious Supervision by the Helping the poor and joining public

Community masses welfare activities

Relationship Visiting communities Community donation and landscaping

Communities and the Contributing to the Promoting employment and developing local suppliers

public Community Economy

22 23Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Lu Thai Textile 2024 ESG Materiality Analysis Matrix

Board Level

Audit Committee

Third Line of Defense

Audit Department

Responsible for supervisory functions conducting audits and investigations to implement a closed-loop

risk management system. It analyzes and independently assesses whether the Company's risk management

measures are adequate and effective.Second Line of Defense

16 Risk Management Departments (e.g. Finance Management Department Corporate Management

Department)

Design implement and oversee risk management practices based on the nature of risks and the Company's

risk tolerance to ensure the Company establishes a suitable and effective risk management system.First Line of Defense

Through this assessment we identified 22 material issues of stakeholder concern in 2024.All departments

Factories and functional departments are responsible for executing fundamental risk management processes

Environment (E) Corresponding Society (S) Corresponding and control measures promptly identifying managing and controlling related risk control systems.Chapter Chapter

01 Climate Change Response Chapter 5 09 Information Security and Privacy Protection Chapter 2

02 Pollutant Emissions Chapter 5 10 Technology Ethics Chapter 2

03 Waste Management Chapter 5 11 Innovation-Driven Development Chapter 3

04 Ecosystem and Biodiversity Protection Chapter 5 12 Product and Services Chapter 3

05 Environmental Compliance Management Chapter 5 13 Supply Chain Security Chapter 4 Responsible business conduct

06 Energy Utilization Chapter 5 14 Workplace Safety Chapter 4

07 Water Resource Utilization Chapter 5 15 Chemical Safety Chapter 4

08 Circular Economy Chapter 5 16 Fair Treatment of SMEs Chapter 4 Compliance management

17 Employees Chapter 6

18 Social Contribution Chapter 7

Adhering to operations with integrity law-abiding principles and compliance Lu Thai Textile has always emphasized that integrity and

law-abiding principles are the foundation of the Company and always abode by the values of "integrity and win-win situation". Under the

Governance (G) Corresponding Chapter philosophy of operations with integrity the Company has continued to strengthen the compliance management system improve compliance

management policies optimize auditing procedures and implement internal control in order to safeguard healthy and sustainable

19 Anti-Bribery and Anti-Corruption Chapter 2 development.

20 Anti-Unfair Competition Chapter 2

21 Stakeholder Engagement Chapter 2、3、4

22 Due Diligence Chapter 4

Compliance management system

Risk management Following the philosophy of operations with integrity the Company has continued to improve the compliance management system

strengthened the effect of internal auditing and established the Self-assessment Control Matrix based on the procedure documents in order to

determine the assessment scope and priorities. With all procedures assessed the on-site testing has identified deficiencies made suggestions

Effective risk management strengthens corporate operations. The Company in accordance with the Code of Corporate Governance for Listed

for improvement and timely produced the Internal Control Self-assessment Report to ensure effective internal control assessment.Companies in China and other national laws as well as its Articles of Association identifies internal and external risks and formulates response

To promote normative and institutionalized business operations the Company considering its realities has formulated the Regulations on

measures. Risks are managed through a structured process including information collection risk assessment and analysis strategy formulation

Internal Auditing in accordance with the Internal Auditing Standards and the Basic Norms for Corporate Internal Control promulgated by the

risk response and monitoring and improvement. Additionally the Company has established a "Three Lines of Defense" risk management

Ministry of Finance and the relevant laws and regulations. By doing so it has effectively improved the overall management and risk prevention

framework to enhance the rationality standardization and effectiveness of its risk management practices.capabilities.

24 25Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Internal audit Business ethics

The Company values the implementation of internal control. Following its 18 guidelines for internal control the Company tested and assessed The Company attaches great importance to business ethics and strictly complies with laws and regulations of countries where it operates as well

the system development and implementation of the internal control of the Head Office and holding subsidiaries. As a result deficiencies in as the industry recognized code of conduct. It has established a Code of Ethics Control Procedure and it advocates honesty and trustworthiness

design and implementation were identified and improved effectively. In 2024 the Company assessed the internal control of seven subsidiaries fair competition anti-corruption openness and transparency and supervises the business behavior of partners committed to creating an

and issued the internal control assessment matrices with internal control audit coverage of 80.45%. honest fair clean and harmonious operating environment.Indicator (Unit) 2022 2023 2024 Anti-corruption and bribery

Internal control audit

coverage (%) 89.03% 82.15% 80.45%

The Company strictly complies with anti-corruption and anti-bribery laws and

Note: Internal control assessment coverage is the ratio of the total assets regulations in its operating regions and has signed the Anti-Bribery Commitment

of the assessed entities to the Company's consolidated total assets Letter. It continuously improves its anti-corruption supervision mechanism to

ensure compliant corporate operations.The Company conducts audits by relevant policies every year. In the first half

of 2024 the Company conducted a special audit on the procurement of dyeing

auxiliaries and the sales activities of the Global Marketing Department Garment

The relevant department Oversees Internal Audit Activities Marketing Department and Brand Promotion Department. The audit covered

supplier selection price inquiries and comparisons bidding management long-

term inventory handling sales processes sales pricing and accounts receivable

Targets Indicators 2022 2023 2024 collection. In the second half of 2024 internal control evaluations of subsidiaries

were conducted and no corruption or fraudulent activities were identified.Senior leaders Quantity of non-conformance events 0 0 0

Middle-level leaders Quantity of non-conformance events

and related functions 0 0 0

Employees Quantity of non-conformance events 0 0 0

External audit results Standard unqualified audit Standard unqualified audit Standard unqualified audit Shareholders opinions opinions opinions Code of conduct for employees

Suppliers Quantity of non-conformance events 0 0 0

The Company continues to strengthen employee behavior management by strictly requiring employees to act in accordance with laws guiding

and supervising employees to abide by rules and regulations and operating in compliance. Through the promotion of corporate culture

Information disclosure

publicity and education training of laws inspection and supervision of employee behaviors and other measures the Company urges employees

to raise awareness of ethical standards and improve their own moral accomplishment to ensure the implementation of integrity values and

The Company has established and improved the information disclosure mechanism which ethical behavior and thereby promote the healthy development of various business.received positive feedback from investors:

Complaint reporting mechanism

As at the end of 2024 the Company had been rated A for seven consecutive years in the information disclosure

assessment on the listed companies on the Mainboard by the Shenzhen Stock Exchange. The Company actively improves its complaint and whistleblowing mechanism by providing multiple reporting channels including mail

telephone email and in-person reports. Customers employees suppliers business partners and all individuals with business dealings with the

The Company releases its performance results as well as major and temporary announcements to investors of A- and B- Group are encouraged to report corruption fraud violations of company policies or any suspected illegal activities.shares via Internet media (cninfo.com) designated by the China Securities Regulatory Commission as well as Securities

Times Shanghai Securities News China Securities Journal and Ta Kung Pao. We are committed to strictly protecting whistleblower privacy and prohibit the disclosure of personal information or report details to any third

party. Retaliation against whistleblowers is strictly prohibited.The Company responds in real time to investors' messages and questions via the "Interaction Easy" of the Shenzhen

Reports will be investigated within 30 working days and a written investigation report will be issued. Follow-up actions will continue to be

Stock Exchange. In 2024 a total of 75 questions were replied with a response rate of 100%.monitored. Employees found to have violated confidentiality policies will face disciplinary action based on severity including reassignment

26 27Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Information security and privacy protection

Information Security Protection Measures

The Company configures firewall security policies and installs server-side

Information security security protection systems.Server Security

We actively implement measures to enhance information security across five dimensions: computer security network security data security

hardware security and operational environment security. To minimize the risk of data breaches we have deployed firewalls intrusion

prevention systems vulnerability scanning systems and bastion hosts as protective measures.Computer Security

The Company deploys unified antivirus Data Security

software and endpoint security protection

The Company has established the Information System Operation Management Process systems. By extracting data from the firewall Offsite and cross-location backups for

the Information Security Management Regulations and the IT Infrastructure Operation intrusion prevention system the Company business data in the data center have been

Management Process to enhance data security emergency response mechanisms detects and eliminates threats such as implemented. The operating system uses

and procedures. In the event of a suspected data breach our IT operations team will malicious attacks and Trojan viruses. virtual machine disaster recovery backups

immediately verify the incident assess the extent of the data breach and affected and devices adopt active-active disaster

systems report the situation to the leadership team suspend relevant data access recovery across different locations. Regular

notify affected users and issue an announcement following legal and regulatory recovery testing is conducted to ensure data

requirements. availability reliability and recoverability.Network Security

Deploy a bastion host management system

The IT operations team will assess affected systems data and devices conduct log The Company has been equipped to manage access permissions and code

tracing for forensic analysis and preserve relevant evidence. Affected users will be with security devices and measures approvals for IT system administrators

informed of the resolution and the affected systems and devices will be restored. including firewalls intrusion while recording backend operations of IT

Security vulnerabilities identified during the investigation will be addressed through prevention systems and internet personnel.system upgrades and reinforcements to prevent future attacks. behavior management tools.Hardware Equipment

Conduct daily inspections promptly report and follow up on identified issues.An environmental monitoring system is in place to track the status of UPS power

During the Reporting Period the Group did not experience any data breaches or legal disputes related to information and data security involving supplies indoor temperature and humidity lighting fire safety equipment and

the Group or its employees. fresh air systems in real time. Develop and implement emergency response drill

plans proactively conduct drills and promptly address issues identified during

the process.The Company regularly provides employees with information security training

and promotes cybersecurity awareness across the Group to continuously

enhance employees' awareness of information security and privacy protection.Privacy protection

The Company and its affiliates are required to strictly comply with the Data Security Law of the People's Republic of China and the Personal

Information Protection Law of the People's Republic of China. Confidentiality agreements must be signed with stakeholders regarding sensitive

information. Unless required by laws and regulations or approved by the customer such information will not be disclosed to any third party in

any form.

28 29Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Products and Services

Building First-Class Products and Services

In the face of the complex and ever-changing market situation the Company leveraged the

driving force of marketing and called on various departments to collaborate efficiently with each

other actively go global deeply understand market changes and get an insight into customer

needs. It focused on targeted research and development design with "technology fashion and

green" as the new industry positioning and the goal of "becoming a global apparel solution

provider with cutting-edge fabrics as the core" the Company continued to do a good job in

products and services.UN Sustainable Development Goals

30 31Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

R&D and innovation Industry-university-research cooperation

Adhering to the "Four-in-One" innovation philosophy which "lets the enterprise play the major role adopts the customer-oriented approach is

underpinned by research institutes and universities and emphasizes the alliance with strategic customers and major suppliers" the Company The Company collaborates with many universities and scientific institutes ranging from the training of basic talents and core technology R&D.has formed a three-level R&D innovation team led by Lu Thai Engineering Technological Institute focusing on breaking through the professional Lu Thai has explored and established an all-round industry-university-research collaboration mechanism with many institutes. As at the end

expertise for production lines and mainly comprising the quality control teams of the workshops and groups of the plants. By doing so it has of 2024 the Company established a long-term partnership with universities such as Donghua University Hong Kong Polytechnic University

continuously enhanced the internal innovation mechanism developed the scientific and technological innovation platforms deepened the Jiangnan University Qingdao University and Wuhan Textile University. Through R&D cooperation with leading institutes in new technologies

industry-university-research cooperation and laid a solid foundation for the Company's innovation cause. materials and products the Company has improved its R&D capability.Investment in technological innovation

Industry-Academia Collaboration

In 2024 the Company's total investment in

scientific and technological research and

development reached RMB 207Millon . By the Science and Science and Technology

end of 2024 the Company had undertaken eight Technology Awards Programs Donghua University

national-level scientific research and innovation Provincial-level and above

platforms and five provincial-level platforms. It Undertaken provincial-level and awards: 60 items

had received a total of 60 national and provincial- above science and technology The Company has established the "National Collaborative Innovation Center of

level Science and Technology Progress Awards programs: 20 itemsOne National First Prize for Key Technologies for Textile Industry" with Donghua University for research of

including one national first prize for science Science and Technology Progress new fiber material technologies and key technologies for eco-friendly dyeing and

and technology progress and three national Patents and Standards finishing. In 2024 the project "Key Technologies and Industrialization of Structural

second prizes for science and technology Three National Second Prizes for Authorized patents held: 548 items Design and Preparation of Thermal and Moisture Comfort Functional Textiles"

progress. The Company undertook 20 science Science and Technology Progress Exchange on Industry-Academia-Research jointly researched with Donghua University was awarded the Second Prize of the

and technology projects at the provincial level or led or participated in the formulation: Collaboration Project between the College of Science and Technology Progress Award by the China National Textile and Apparel

above and obtained 548 authorized patents and 9 Provincial and Ministerial First 75 items Textiles and Clothing Donghua University and Council

eight software copyrights. Additionally it led or Prizes for Science and Technology Lu Thai Textile Co. Ltd.participated in the formulation of 75 national Progress

and industry standards.Developing scientific and technological R&D platforms Wuhan Textile University

In 2024 Lu Thai collaborated with Wuhan Textile University to apply for

The Company highlights the building and development of scientific and technological innovation platforms establishing core technology the "High-Efficiency CNC Online Dyeing System Technology" project

platforms in the major phrases of research design and test to improve core technologies in the whole process. which was awarded the First Prize of the Science and Technology

Progress Award by the China National Textile and Apparel Council.With the help of technological platforms such as the national enterprise technical center

national demonstration base for talent introduction national yarn-dyed fabric R&D base In 2024 a "Framework Agreement on Technical R&D Cooperation for Domestic Lyocell Fiber Fabrics" was signed to conduct research on the Exchange on Industry-Academia-Research Shandong Provincial Engineering Technology Research Center and Shandong Big Data Collaboration Project between Wuhan

Textile garment Industry Innovation Center Lu Thai Engineering Technological Institute has worked with

development of domestic Lyocell. Textile University and Lu Thai Textile Co.research platform production lines for yarn-dyed fabric knitted fabric apparel printing and dyeing and Ltd.functional fabric to conduct explorations. It has been dedicated to researching cutting-edge

technologies. As a result they have paved a path based on fabric but transcending traditional

fabric in scientific and technological innovation quality improvement brand promotion low-

carbon energy conservation and corporate culture development.Lu Thai Engineering Technological Institute has capitalized on the design resources of the

national industrial design center the Shandong Provincial industrial design center an Italian The Company signed a strategic collaboration agreement with Qingdao University in 2016 to carry out in-depth

Textile garment designer's workshop for fabric design and the enterprise brand design center to build a cooperation with the university in scientific research talent cultivation and social services thereby contributing to

textile and apparel design platform. The platform has integrated textile and garment trendy socioeconomic and technological development.design platform

design textile new material design popular fabrics design and garment brand design which

represents the major backbone of the enterprise's independent brand building and promotes Qingdao In terms of scientific research Qingdao University and the Company have jointly established the "Lu Thai Group-

the Company to take leap from creation to creativity. -Qingdao University Research Center" and the "National Collaborative Innovation Center of Key Technologies for University Textile Industry" to be dedicated to the research of industrial textile and marine biomass fiber.Lu Thai owns a complete set of testing devices and equipment for textile materials fabrics and In terms of talent cultivation the Company has set up the "Lu Thai Scholarship" in the university and the "Lu Thai

garments as well as dyeing and finishing auxiliaries. It is equipped with laboratories that meet International Talent Reserve Class". As a result a number of brilliant students from textile universities have been

Textile garment testing and international standards including the constant temperature and humidity laboratory textile

attracted to Lu Thai and become the backbone of the Company.material testing laboratory fabric and garment laboratory and chemical analysis and synthesis

experimental platforms laboratory. Also it has an experienced professional testing team that is familiar with domestic

and overseas standards. As a result Lu Thai has made every effort to establish an integrated

testing and inspection platform in the textile and apparel industry at home and abroad.

32 33Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

The Company has cooperated with the Shandong University of Technology in establishing the Lu Thai School of

Textile and Apparel thereby promoting organic industry-education integration collaborative innovation and The Company attaches great importance to the protection of intellectual property rights

integrated industrial-educational development. constantly improves the protection system of intellectual property rights sets up teams for

The Company has also worked together with the university to establish laboratories and share research apparatus the protection of intellectual property rights and patents. Moreover it formulates trademark

and platforms achieving research integration in terms of the scientific program development and project management standards patent application management procedures stands against the

Shandong application. infringement of trademark rights patent rights and copyrights and continues to improve the

University of A team of part-time teachers including Taishan Scholars senior experts of the Company and excellent holistic operation efficiency in protecting intellectual property rights. In 2024 the Company

Technology technological talent has been built to achieve the integration of teaching resources of the university and the applied for three government projects at the national provincial and ministerial levels

Company. developed 137 new products and new processes conducted 25 technological improvement

The Company has utilized the comprehensive strengths of both sides to introduce more practice and internship projects obtained 17 authorized patents and one software copyright and led or participated in

opportunities for students. It donates RMB1 million to the university for collaborative talent cultivation every year. Intellectual property the formulation of four industry standards.Meanwhile the "Lu Thai Scholarship" has been set up to encourage students to work hard achieving "joint talent rights protection

cultivation" between the university and the Company.Tiangong In 2022 Lu Thai collaborated with Tiangong University to apply for the "Virtual Human Body Modeling System for Technological research and development

University Clothing" which won the Excellence Award in the First Intelligent Manufacturing Innovation Competition.Lu Thai Textile has maintained an open attitude toward technological R&D and kept strengthening the industry-university-research cooperation.It has developed green and low-carbon technologies both independently and through cooperation and has continuously optimized the

Company's clean production mode. As a result the Company's green and sustainable development has been constantly boosted. Over the years

Shandong

In 2022 the Company engaged in strategic discussions with Shandong Vocational College of Science and the Company has obtained more than 500 patents including 27 projects that have received national and provincial-level awards for scientific Vocational

College of Technology and signed a strategic cooperation agreement to jointly establish an overseas "Luban Workshop" for and technological progress in energy conservation.Science and the joint cultivation of international talents.Technology

Key R&D projects

"High-Efficiency CNC Online Dyeing

1 System Technology" Project

The Company in collaboration with Wuhan Textile

University and other relevant institutions has conducted

joint research on this technology which utilizes a CNC-

integrated system for textile dyeing control. It is widely

applied in the dyeing of yarn-dyed fabrics printing and

dyeing and knitted textiles. This technology eliminates

the traditional reliance on temperature and salt in In 2024 the Company launched 25 company-level technological research projects and 137 department-level research topics. The company-

dyeing processes addressing the industry's challenge level projects primarily focused on overcoming technical bottlenecks and conducting research on forward-looking technology reserves. Among

of high-salinity wastewater generated by conventional them the research project on knitted fabric dyeing technology achieved a production order volume of 5488000 million meters with a first-

reactive dyeing. It actively promotes and serves as a class delivery rate of 97.2% showing a significant increase compared to the previous year.model for the green and high-quality development of the

textile industry advancing textile products toward the

mid-to-high end of the global value chain. Furthermore Product innovation

it significantly contributes to achieving China's goals of

becoming a manufacturing and quality powerhouse.The development of the Company for 37 years has always relied on good product development and realization capabilities and in the future

it still needs to rely on products to win the market. Currently customers are increasingly interested in the green and environmentally-friendly

products with differentiated attributes and high performance. The Company adapts to the development trend of the textile industry focus on

customer needs and do a good job in technological innovation and upgrades. It continuously carries out product research and development

and product upgrades to provide customers with products that meet their needs and are cost-effective.The Company in collaboration with Donghua University and other relevant institutions has jointly conducted research on this

project which explores the multi-layered structure morphological design and functional regulation of thermal and moisture Raw material innovation: Sustainable exploration development and cooperation in terms of raw materials; the renewable degradable

comfort fibers as well as the mechanisms and evaluation systems for assessing textile products' thermal and moisture comfort recyclable and sustainable product series that are featured by the natural fiber and regenerated cellulose fiber series and the bio-based series.properties. The research focuses on fiber composition design and preparation technologies functional textile design and key

technologies such as multi-component composite spinning composite structural weaving one-bath dyeing for multi-fiber blends Technological innovation: In-depth research into crafts and technologies and the full-process processing for green production that is water-

and moisture absorption and wicking functional finishing. This project provides valuable references and demonstrations for the saving energy-saving and low-emission; active efforts to keep improving green and environmentally-friendly technology to effectively support

preparation and application of high-quality thermal and moisture comfort functional fibers. and continuously upgrade products.

2 "Key Technologies and Industrialization of Structural Design and Preparation of Thermal and Product innovation: Continuous exploration of innovative full-life-cycle application solutions for textile products and continuous introduction Moisture Comfort Functional Textiles" Project of new and environmentally-friendly product series that are skin-friendly and comfortable elastic easy-to-manage and good for health to the

market by continuous updating multicomponent products such as natural fiber regenerated cellulose fiber and ultra soft texture fiber.

34 35Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Quality control

Case Lu Thai Xurou – Ultimate Softness Soft but Structured Smooth but Not Slippery The Company adheres to the principle of "quality is the most important element of enterprise survival and development" and continuously

strengthens quality control with the purpose of "meeting the needs of customers and the market". In accordance with GB/T 19001-2016 Quality

Management Systems the Company’s Quality Management Department formulates quality indicators translating customer feedback into

quality requirements to precisely control both process quality and result conformity. The quality management assessment mechanism has been

refined to incentivize improvements in product quality across workshops.By selecting premium raw materials and integrating Lu Thai’s innovative patented

spinning technology with high-precision weaving craftsmanship and proprietary

dyeing and finishing techniques the Lu Thai Xurou product was developed. Standard System for

It features a soft and smooth texture skin-friendly breathability and a weightless Raw material Physical Indicators

pressure-free wearing experience. The combination of natural materials and cold- preparation and GB JIS AATCC/ASTM

resistant thermal insulation functions provides an unrestricted and comfortable fit. ISO Alignment between control room Lu Thai’s internal

control and actual data

Standard System for

Standard System for Raw Appearance Inspection

Product pre- Quality Process control Yarn Inspection Defective fabric batch Standard

control room assurance room Color difference hand

color variation of finished

feel elasticity uniformity System products grading Case Ocean Yarn Fabric strength alignment with evaluation responsibility

fabric indicators determination

This regenerated polyester fiber product is made from 100% recycled materials Standard System for

sourced from plastic bottles collected within 50 kilometers of coastlines or washed Process Inspection

ashore by ocean waves. Globally its production has repurposed 900 million discarded Central laboratory Re-dyeing rate elasticity

plastic bottles making it one of the most certified and traceable regenerated fibers in styling process yarn color linear density strength

the world.Comfortable Cotton Feel: The interwoven structure of fine cotton and Ocean

Yarn imparts a soft cotton-like touch with an elegant sheen. It also boasts high

elasticity excellent shape recovery wrinkle resistance easy care quick drying and

breathability. □ Re-dyeing rate elasticity styling process yarn color linear density strength

□ The Company holds production meetings every day to address any problems encountered during production.□ The Company strengthens the process compliance inspection on each process and supervises and manages it through sampling and tracking

methods.□ The Company actively communicates with customers and absorbs their valuable feedback on product quality.Case □ The Company organizes professional training for quality management personnel to continuously improve the quality awareness and ability Bio-Based Nylon 56 Fabric

of all staff.□ The Company has a CNAS laboratory certified by the state achieving independent testing of some indicators.□ The Company sends 100% of textiles to professional organizations (e.g. ITS SGS BV Keken) for a safety inspection to make certain that these

Nylon 56 is a novel nylon material synthesized from bio-based

pentamethylenediamine and adipic acid. Compared to traditional petroleum-based textiles are in line with market laws and regulations standards and customers' RSL requirements.nylon it offers a lower carbon footprint and superior environmental friendliness.As the concept of sustainable development continues to gain traction Nylon 56 as

a bio-based and biodegradable material is expected to play a key role in green and

eco-friendly products.Case Recycled Cotton Fabric Laboratory

Recycled cotton fabric is designed to reduce environmental pollution by reclaiming

and repurposing discarded textiles. Lu Thai has been actively promoting resource

circularity and is committed to sustainable development. Through technological

innovation we strive to create a brighter future for sustainable fashion. With over

30 years of expertise Lu Thai has leveraged its full-industry-chain technological

innovations to develop recycled cotton fabric paying sincere tribute to sustainability

and the future.Personnel Training

36 37Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Fabric Exhibitions Apparel Exhibitions

Production Lines Pass Rate Participated in eight

fabric exhibitions:

seven overseas and one Participated in seven Yarn 99.99% apparel exhibitions: four

In 2024 Lu Thai Textile achieved a 99.99% Grade A storage domestic exhibitions. overseas and three domestic

Yarn-dyed fabrics 99.30% rate for spun yarn a 99.30% acceptance rate for yarn-dyed Jointly exhibited with exhibitions.apparel business in 4 of

products a 97.47% first-grade storage rate for knitted

Knitted fabrics 97.47% them.products a 97.95% delivery rate for piece-dyed finished

Piece-dyed fabrics 97.95% products a 95.90% delivery rate for functional fabric finished products and a 99.99% delivery rate for garments. Tracking of potential fabric customers from exhibitions:

Functional fabrics 95.90% Number of Potential

No. Exhibition Name Date Customers

Ready-to-wear clothing 99.99%

1 London Textile fair January 9-10 2024

2 MAGIC SHOW February 13-15 2024 4

Customer services and maintenance

3 TEXWORLD/APP February 5-7 2024 1

The Company adheres to a customer-centric approach and comprehensively enhances its customer service capabilities. 4 EXPO Producción March 20-22 2024 7

Constant care 5 China Shandong Export Commodities Fair (Osaka Japan) March 6-8 2024 1

6 Functional Textiles Shanghai by Performance Days April 2-3 2024

7 SaigonTex April 10-13 2024 3

The Company communicates with customers through multiple media such as email WeChat and phone to learn customers'

demands and suggestions. 8 2024 Canton Fair (Spring) May 1-4 2024 1

The Company formulates the standard procedure for handling customer complaints in time so as to protect the legal rights and

interests of customers. 9 ITF May 20-22 2024 1

The Company convenes video conferences with customers to discuss technical issues and problems of quality.The Company regularly visits customers to maintain a good relationship. In 2024 the Company conducted 435 customer visits.The Company invites customers to visit or participate in new product releases or important events to enhance customer 10 International Sourcing Expo Australia June 12-14 2024

relationships. In 2024 the Company hosted 478 customer visits.The Company regularly organizes exhibitions and product promotion events to help customers gain a better understanding of

its high-quality products and services.

11 Premiere Vision July 2-4 2024 1

12 Intertextile Shanghai Apparel Fabrics (Hotel) August 27-29 2024 3

13 ATSC August 26-28 2024 1

14 Preview In SEOUL August 21-23 2024 1

15 Textile salon February 2024

16 London Textile fair September 3-4 2024

17 Functional Textiles Shanghai by Performance Days October 9-10 2024 15

18 FASHION WORLD TOKYO October 15-17 2024 4

19 2024 Canton Fair (Autumn) October 31 2024 2

Total 45

38 39Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

This year a total of 241 customers were surveyed for fabric products with 215 valid responses achieving a response rate of 89% and a final score

Tracking of potential fabric customers from exhibitions: of 82.79. For apparel products 108 customers were surveyed with 77 valid responses achieving a response rate of 71% and a final score of 80.1.Number of Potential

No Exhibition Name Date Customers

Fabric business

1 MAGIC SHOW February 13-15 2024 6

2 TEXWORLD/APP February 5-7 2024 2 Corporate brand image 86.84

3 SaigonTex April 10-13 2024 1 Products 86.36

4 2024 Canton Fair (Spring) May 1-4 2024 2 R&D 82.42

Design 81.02

5 LINK-TCE Clothing Customization Expo – Shanghai May 8-10 2024 4

Price 65.77

6 ITF May 20-22 2024 2

Delivery 83.64

7 Premiere Vision July 2-4 2024 1

Service 85.31

8 ATSC August 26-28 2024 2

Customer relationships 90.95

9 Preview In SEOUL August 21-23 2024 2

Average Customer Satisfaction Scores for Each Business Segment

10 FASHION WORLD TOKYO October 15-17 2024 2

Total 24 Customer satisfaction in customer relationship management and corporate brand image was relatively high.Customer satisfaction survey and improvements

Apparel business

Lu Thai Textile continuously improves and optimizes its customer satisfaction survey every year including survey methods questionnaire

design and enhancing the authenticity rigor and objectivity of the survey. Based on the survey results a satisfaction report is generated to

analyze the Company's strengths and weaknesses allowing for targeted improvements to better meet customer expectations. Customer relations 90.3

This year the Company received guidance from satisfaction experts and further refined and upgraded the questionnaire. It now covers eight

dimensions: corporate brand image product quality R&D design price delivery service capability and customer relationships with a total of Corporate brand image 82.6

25 rating items. A ten-point scale is used for scoring. Service 82.5

Product quality 81.8

Pre-sales consultation and information acquisition Lu Thai Satisfaction Model –

Basic Model Delivery 81.6

Qx Delivery process Design 77.2

Qi

Qm Product performance R&D 76.4

Qc Pricing 69.4

Qz Price Satisfaction Loyalty

Average Customer Satisfaction Scores for Each Business Segment

R&D and design

After-sales service Customer satisfaction in customer relationship management corporate brand image and service was relatively high.Customer relationships

40 41Production Operations/

Responsible Production

Operations

In line with the principles of being responsible to customers employees and society Lu Thai

implements the philosophy of "responsible production and operations" improves safety production

mechanisms enhances chemical safety management and regulates supplier behaviors with high

standards. The Company is committed to providing customers with reliable products and employees

with a safe workplace minimizing social impact during sound operations safeguarding the rights and

interests of stakeholders in multiple aspects and achieving the long-term stable development of the

Company.UN Sustainable Development GoalsChairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Production safety management

Production safety involving employees' life safety is the key to the survival and development of the enterprise. Its responsibilities are weightier

than Mount Tai. Luthai insists on the principle of "safety first prevention first and comprehensive management" and implements national local

and industrial policies laws and regulations and standards on safety work. The Company consciously carries out all rules and regulations of

production safety and supervises the implementation.Safety management system and institutional development

The Company is conducting an on-site safety hazard inspection

In terms of safety training the Company carried out the training of the first lesson after the Spring Festival Qingming Festival Mid-Autumn

Festival and National Day and organized a series of special training in 2024 such as 27 training sessions for new employees 77 safety training

sessions for all employees 14 training sessions for special operators two training sessions from invited external experts special equipment

training and certified safety engineer training. Moreover the Company has implemented the government's special action requirements on

"deep learning deep training wide examination" for safety production and achieved the normalization of safety training and learning. In

addition the Company has conducted "Safety Production Month" activities with the theme of "everyone values safety and knows how to

The Company has continuously The Company has set up a Safety The Company has established the

safety production targets management handle emergencies and ensures smooth life channels" aiming to prevent and defuse major risks eliminate potential safety hazards in a timely improved safety production Production Committee and an

standardization templates Accident Emergency Rescue Leading responsibility system and signed manner and effectively curb production safety incidents and finally create a sound environment for safety production. In the whole year of 2024

conducted internal safety Group around the Safety Inspection the Responsibility Letter for Safety the Company conducted more than 100 various safety training sessions with over 13000 trainees.standardization reviews for various Office with a total number of 68 safety Production Targets Management at

departments and supervised and management personnel. all levels. Besides the Company has

broken down the accident control

inspected the implementation of targets by levels and implemented strict

safety standards in various plants. assessments of personnel at all levels

to ensure the fulfillment of the safety

production control targets.Eradicate fire risks and personal casualties Prevent the accidents of major environments

and occupational health and safety

The Company's

Safety Control

Targets in 2024

Eliminate grand electromechanical Avoid traffic accident

equipment accidents

The Company has implemented that the safety facilities in construction must be designed constructed approved and put into production and

use at the same time as the main project to control and prevent safety accidents from the source. Various types of training Company-wide safety training safety morning meetings

The Company continues to improve the dual prevention system for hierarchical control of production safety risk and investigation and

governance of hazards and persists in risk prevention and early identification. In terms of hierarchical risk control the Company identifies the

risk hazards in operating activities and equipment and facilities in each sector every year classifies the types and consequences of possible

incidents and determines the hierarchy of control and the corresponding accountable person according to the category. In 2024 the Company

identified a total of 291 risk hazards in various production and operating activities. For each risk hazard the Company has formulated specific

risk control measures to prevent and control risks by ways such as standard specification safety training distribution of supplies for labor

conservation and protection on-site supervision and inspection emergency response drills and timely handling of incidents.In terms of risk hazard inspections the Company's Safety Inspection Office carried out various inspections in 2024 including special inspections

for dust explosion-proof diagnosis by invited safety experts intrinsic safety of equipment confined space hazardous chemicals special

inspections of warehouses general inspections during the holidays and departmental self-inspections and self-corrections which identified First lesson on resumption of work

more than 23000 safety hazards. During the Reporting Period all risk hazards were eliminated.

44 45Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Diversified “Safety Production Month” activities

During the "Safety Production Month" campaign in June 2024 the Company conducted a variety of activities such as publicity board design

special training on safety production inspections on potential safety hazards award-winning essay contests safety promotion short videos and

emergency response drills. All employees actively participated in these activities and their safety awareness was effectively improved.The Company organized various departments to carry out publicity board design activities with the theme of "everyone values safety and

knows how to handle emergencies" and created a total of 58 boards.A total of 320 teams from various departments and subsidiaries participated in the "Inspection Prevention and Promotion" safety hazard

investigation activity with 7260 participants. A total of 4185 hazards were identified and 68 outstanding teams were selected.The Company is conducting an emergency drill

Fire safety management

As a key unit of fire safety the Company implements the working policy of "prevention first with a combination of fire prevention and

firefighting" standardizes fire safety management procedures strictly implements fire safety management regulations to effectively prevent fire

accidents and guarantee the implementation of emergency rescue. In addition these measures minimize property damage and personnel injury

The Company conducted the "Safety Production Douyin Contest" collecting 70 entries and awarding two first prizes three second prizes caused by fire occurrence and fire rescuing.and five third prizes. Two of these entries were selected for the "Taizhan Cup" Douyin Contest organized by the Zichuan District Emergency

The Company's Security Department conducts targeted annual training sessions on fire safety knowledge fire extinguishing and evacuation

Management Bureau.drills training for key and critical areas and hands-on training for volunteer firefighters on firefighting equipment. These initiatives aim to raise

The Company organized the "Emergency Drill Competition" with 15 teams participating. After evaluation by experts from the Zichuan overall fire safety awareness and enhance emergency response capabilities. Each department strictly adheres to the Hot Work Management

District Emergency Management Bureau and safety inspection personnel two first prizes three second prizes and five third prizes were System the Fire Inspection System and the Electrical Safety Management System to establish a solid fire safety firewall.awarded. Luthai in collaboration with China Mobile has developed a 5G Smart Shared Management Platform integrating security and firefighting

functions. Through various intelligent features such as AI Engine Security Monitoring Park Access Control Smart Firefighting and Wireless

Intercom the platform creates an information-sharing and intelligent management system for security and fire protection. This enhances

three-dimensional safety management intelligent emergency support and coordinated emergency response improving the efficiency of the

Company's fire safety and security management.Safety production emergency management

Video Monitoring Wireless Intercom

The Company has established a sound production safety emergency management system and actively carried out emergency response drills to

comprehensively improve its capacity for emergency response and accident rescue. For example it has formulated several response plans such

as the Regulations on Emergency Preparedness and Response Management the Emergency Preparedness and Response for Fire Accidents the

Emergency Preparedness and Response for Hazardous Chemicals Leakage Accidents and the Emergency Preparedness and Response for Natural

Gas Leakage Accidents. In 2024 the Company organized each plant to conduct emergency response drills including 30 special response drills

and 266 on-site disposal drills and carried out a total of 15 "Emergency Rehearsal Training" in the "Safety Production Month" activities. Through

various emergency drills the Company has enhanced the emergency response capabilities of all departments improving self-rescue and mutual

aid abilities to safeguard lives and property.Smart Firefighting AI Engine

46 47Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Chemical management

Employee training on critical parts

Visible fire monitoring Fire safety hazard inspection protection

13332.19 2708 2388 Procurement storage and usage management

hours items trainees

The Company controls the whole process of procurement transportation storage use and disposal of chemicals especially for the purchase

and use of hazardous chemicals. Moreover the Company has formulated management systems and regulations such as the Safety Management

Fire extinguishing and evacuation drills Test on automatic sprinklers system Major fire safety incident System for Hazardous Chemicals the Regulations on the Supervision and Inspection of Hazardous Chemicals the Safety Management System

270 11951 0 for the Storage Handling and Use of Liquid Ammonia and the Regulations on the Supervision and Inspection of Major Hazard Installations of

Liquid Ammonia prompting each operation to be standardized detailed and normalized.sessions points times

For precursor chemicals and explosive chemicals the Company strictly complies with national regulations and

reports to the public security authorities in a timely manner. The Company establishes a chemical flow ledger and

strictly controls the use to prevent the outflow and illegal use of such chemicals.Chemical suppliers must possess a business license production permit hazardous chemicals registration

certificate and other necessary qualifications before approval and must sign the Environmental Compliance

Declaration.When each chemical is first purchased in the year a complete MSDS list should be requested from the supplier and

hung at the chemical usage and storage site.Fire safety training

Each user department must store chemicals in appropriate quantities according to their properties establish and

improve hazardous chemicals safety management systems and emergency response plans and assign dedicated

personnel for hazardous chemical management with clearly defined responsibilities.Volunteer firefighter training Firefighting and evacuation drill

Factories using chemical products must conduct at least one chemical training session per year to educate

employees on the properties and hazards of the chemicals used as well as emergency handling and self-rescue

procedures in case of spills or contact with eyes or skin. Employees are also trained on proper storage and usage.Chemical administrators must obtain professional certifications through regular external training.Restricted substances control

The Company organizes "119 Fire Safety Publicity Month" activities As the international awareness of environmental protection and product safety grows the demand for green production and environment-

friendly products has become a major trend. Luthai an international manufacturing enterprise naturally does not hesitate to keep up with the

times and has established a whole process chemical control mechanism.

48 49Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Luthai Textile Chemical Management

Understand relevant laws and Create a list of concerns on Ways to identify harmful

Source control: Management of chemical suppliers regulations and documents harmful substance chemicals

Selection of new suppliers Government Chemicals Compliance screening of Material

In accordance with the requirements of laws and regulations standards Daily evaluation of suppliers Non-governmental Textiles Safety Data Sheet ("MSDS")On-site audit of suppliers organizations Initial identification of harmful

instructions and customers' restricted substances list ("RSL") of each Input Approval/removal of qualified suppliers WastewaterCustomers and brands chemicals according to the type of · Supplier Quality and Safety Assurance Sludge

nation and region the Company has established a chemical approval management auxiliariesAgreement

Third-party testing

system and the Manufacturing Restricted Substances List ("MRSL") which is · Declaration of Environmental Conformity of Chemicals Analysis and tracking of testing data

stricter than market regulations/standards. When chemicals for production · Declaration of Environmental Conformity for Raw Materials and

pass the experiment test the Company will entrust the third-party testing Auxiliaries

organization to conduct the test on toxic and harmful chemicals. Only

Management of procurement storage

suppliers with test results in conformity with the MRSL are included in Process testing and Ways to identify harmful Chemical Testing use and other aspects of chemicals validation Green technology chemicals

the list of qualified suppliers and can then be used for bulk purchase. Safety Management Process of Textile Tap water Substitution of dyeing Compliance screening of Material

Meanwhile the Company strengthens the application of efficient and Chemicals Dyeing drainage auxiliary Safety Data Sheet ("MSDS")

Provisions for the Management of Warp sizing drainage Reduction of dyeing auxiliary Initial identification of harmful environment-friendly dyeing auxiliary to eliminate the production of toxic Production Departmental Chemicals Emission reduction chemicals according to the type of Organization of drainage

and harmful chemicals from the source. process Provisions for the Management of auxiliariesShort process...Procurement of Sizing Agents Dyestuffs Third-party testing

and Auxiliaries Analysis and tracking of testing

Provisions for the Management data

Production process control: of Safety Control for Warehouse

Management Department

Training is provided to all factories to ensure familiarity with the chemicals

Participation in green

in use. For orders with specific customer requirements only compliant Creation of a testing data list activities

products are used in strict accordance with customer specifications such Brand customers Information disclosure Luthai reduces the level of pollutants through

through IPE efficient chemicals management and good

as ZDHC Conformity Level 1 or higher dyeing auxiliaries. Chemicals process control. Meanwhile the Company

Output-end Water quality works together with relevant parties such as

Each batch of finished products shall be sent to a professional third- management Sludge major brands in the supply chain suppliers

Product Safety Testing chemical industry and non-governmental

party testing institution for restricted substances safety testing. Only after Products organizations to reduce the impacts on the

environment.passing the test and receiving a certificate of compliance from the Quality

Management Department can the products be packed and shipped.Terminal management:

Besides the Company tests the discharged wastewater and sludge for toxic

and harmful chemicals according to the wastewater guidelines of Zero Supply chain management

Discharge of Hazardous Chemicals ("ZDHC") twice a year to ensure zero

discharge of toxic and harmful chemicals.Through a new generation of integrated and collaborative platform (ERP system) based on Internet services and technical architecture the

Company has realized the information flow in the whole process from supplier access to purchase warehousing. This has ensured the

Wastewater and Sludge Testing Report information flow in all processes of the supply chain improved the efficiency of raw material supply and made the purchase process

more standardized and transparent.The Company places great importance on the transparency of chemical information and data. It annually discloses Pollutant Release and

Transfer Register (PRTR) data on the ZDHC Gateway and the Institute of Public & Environmental Affairs (IPE). Additionally twice a year the

Company publishes wastewater DETOX emission data. At the same time the Company communicates and interacts with suppliers customers Supplier management

third-party testing organizations non-governmental organizations and other relevant parties to achieve sustainable improvement of chemicals

management.Supplier onboarding

When selecting suppliers the candidates are required to possess relevant product qualification certification and have manufactured same

or similar products for at least one year with a certain production scale. Priority will be given to suppliers who have obtained authoritative

certifications such as the ISO 9001 Quality Management System Certification the ISO14001 Environmental Management System Certification

the ISO45001 Occupational Health and Safety Management System Certification the SA8000 Social Responsibility Management System

Certification and the Green Factory Certification.Before approval on-site audits are conducted for suppliers to assess whether their production quality control processes and social

responsibility performance comply with relevant certification standards. Only after product use and testing meet requirements can they be listed

Data Releasing Platform as approved suppliers. Prior to procurement and usage suppliers are required to sign documents such as the Quality Agreement the Supplier

Code of Conduct and the Environmental Compliance Declaration to protect the Company’s legal rights and interests.

50 51Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Audit Deficiency Analysis Suppliers conduct a comprehensive analysis of deficiencies identified during the audit to determine

the root causes and develop targeted corrective actions.

01

Formulating a Corrective Based on the audit deficiency analysis suppliers develop a detailed corrective action plan including

Action Plan corrective measures responsible departments and personnel and a deadline for completion.

02

Implementing Corrective

Measures Suppliers implement corrective actions step by step according to the audit plan.

03

Reviewing and Evaluating Suppliers conduct regular reviews to ensure corrective measures are continuously and effectively

Corrective Results s implemented and that audit deficiencies are fully resolved.Quality Agreement Environmental Compliance Declaration 04

Summarizing and Sharing

The Company collaborates with suppliers of raw materials auxiliary materials and food ingredients of varying scales—from large to Suppliers summarize the lessons learned during the corrective process and voluntarily share them.Corrective Action Experiences

small—on the basis of equality and mutual benefit. 05

Routine supplier management

In daily management the Company conducts annual surveys on supplier profiles and performs periodic supervision and audits to

maintain real-time oversight of their quality and CSR management.Supplier Audit Dimensions

Insurance

Human

Personn

EHS

Equipment Supplier Audit Report

Material

Production The Company also conducts semi-annual and annual supplier assessments according to different raw material suppliers and classifies

Quality suppliers based on the assessment results.Tier I Supplier (90 points and Appropriately increase purchase volume

above)

In 2024 a total of 58 suppliers were audited of which 57 passed and one failed. The annual supplier audit plan was fully completed. Tier II Supplier (75–90 points) Normal cooperation

For issues identified during the audits we supervise suppliers to carry out corrective actions following the process below and continue to Result

monitor progress. Application

Tier III Supplier (65–75 points) Send Information Notice rectify within deadline

Tier IV Supplier (below 65 points) Suspend supply send Information Notice rectify within deadline and disqualify if requirements

are not met

52 53Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Procurement management

In terms of procurement whether to invite bids is determined based on

different materials and the annual procurement amount. If bidding is

required the Bidding Office will conduct publication and assessment to

select winning bidders. The Procurement Department drafts contracts based

on the bidding documents and the bid documents of the winning bidder

and conducts subsequent procurement after being reviewed by the Legal

Affairs and approved by the President. For those that do not require bidding

the Procurement Department selects suppliers from the List of Qualified

Categorized Evaluation Suppliers conducts price inquiries and comparisons confirms purchasers

and proceeds with subsequent procurement work.For dyeing aids raw cotton and yarn we priorities products certified by

Supply Chain Quality Improvement Bluesign GOTS/OCS and GRS. We continue to promote the use of recycled

polyester recycled nylon and recycled cotton to improve resource utilization.Procured materials are subject to full inspection or random sampling Raw Material Inspection Report

Develop and implement a supplier audit plan to emphasize our specific requirements for suppliers inspection based on category ensuring that non-conforming inputs are

in various aspects through audits. Require suppliers to promptly rectify issues identified during controlled at the source.

01 audits. Audit results serve as key factors in the supplier’s annual comprehensive assessment and

directly impact the allocation of procurement shares for the following year.Warehouse management

The Company has designated warehouses for storing raw cotton yarn chemicals and other materials strictly following relevant regulations and

maintaining appropriate environmental conditions and temperatures for different raw materials.Share the latest management concepts and best practices with suppliers gather their feedback and

02 suggestions and collaborate on addressing quality issues.

Communicate Luthai’s quality philosophy and requirements provide technical guidance and

03 training to help suppliers enhance their quality management and encourage them to obtain

relevant system certifications.Each batch of incoming materials undergoes an appearance inspection and internal quality sampling test before being accepted into storage. A

material inventory ledger is maintained and material requisition follows a "receipt-based requisition" system. The material flow and stock levels

can be monitored in real-time through the inventory management system.

04 Collaborate with suppliers on innovative product development to achieve mutual benefits.

Internal control

The internal control evaluation is carried out by the Audit Department of the Company every year so as to timely identify the loopholes and risks

in the supplier management procedure which lays a solid foundation for the building of a responsible supply chain.Case The main contents of internal control evaluation include

W h e t h e r a r e a s o n a b l e W h et h e r t h e s u p p l i e rs a re Whether the supplier management

At the beginning of the year the Company provided

supplier evaluation and s e l e c te d a cco r d i n g to t h e system and supplier elimination system

systematic training on in-factory transportation are set up so as to conduct real-time access system is established p r i n c i p l e o f f a i r a n d j u s t management assessment and evaluation

and operational safety for its partnered logistics to examine the authenticity competition and the quality on the quality price delivery timeliness

companies. a n d l e g i t i m a c y o f t h e assurance agreement is signed supply conditions qualification and reputation operating status of materials

suppliers' qualification and with the suppliers on the basis or services provided by suppliers and

reputation. of effectively preventing the risk to m a ke rea s o n a b l e s e l e ct i o n a n d

of fraud. adjustments to suppliers based on the assessment results.

54 55Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Energy Conservation and Environmental

Protection/Advancing Green and Low-

Carbon Development

With the development of the economy and the advancement of technology global issues such

as resource scarcity and climate change have become increasingly urgent. Promoting green and

low-carbon development has become a consensus and action for countries around the world to

address resource and environmental issues and promote sustainable development. As a green

pioneer and initiator of the Green Manufacturing Alliance in the global textile industry Lu Thai has

always adhered to the sustainable development path of "green low-carbon and environmentally

friendly" followed the economic growth model of "resources - products - renewable resources"

and insisted on the operating principles of "reduction reuse and recycling". Based on low-

carbon and environmentally-friendly raw materials the Company has promoted the upgrades

of equipment in terms of energy conservation and environmentally friendly and achieved the

research and application of green processes assisting the world in achieving a win-win supply

chain ecosystem and sustainable human development.UN Sustainable Development Goals

56 57Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Environmental management indicators achievement

Luthai Environmental Management Achievements in 2024

Data related to wastewater and sewage

Indicator (Unit) 2020 2024 Reduction Compared

to the Baseline Year

COD (Chemical Oxygen Demand) in 349 248 28.94%

discharged wastewater (ton)

Ammonia nitrogen content in

discharged wastewater (ton) 9 3 66.67%

Industrial wastewater discharge

(10000 cubic meters) 305 291 4.59%

Air pollutant emissions

Indicator (Unit) 2020 2024 Reduction Compared

to the Baseline Year

Sulfur dioxide in emitted exhaust 60%

gas (ton) 0.5 0.2

Nitrogen oxides in emitted 88.89%

exhaust gas (ton) 4.5 0.5 Addressing climate change

Climate change is not only an environmental issue but also a development issue. As a global textile enterprise Lu Thai actively regards

Waste discharge addressing climate change as an important action for sustainable development vigorously promoting energy conservation and carbon

reduction in production and operation and contributing to global climate governance.Indicator (Unit) 2020 2024 Reduction Compared

to the Baseline Year

Risk analysis and response measures

Hazardous waste generation (ton) 51 36 29.41%

The Shared Socioeconomic Pathways (SSPs) are a powerful tool introduced by the Intergovernmental Panel on Climate Change (IPCC) in 2010 to

Non-hazardous waste generation

(sludge) (ton) 14552 11420 21.52% describe global socioeconomic development scenarios. SSPs were developed based on Representative Concentration Pathways (RCPs) and are

used to quantitatively describe the relationship between climate change and socioeconomic development pathways reflecting the adaptation

and mitigation challenges that future societies may face in response to climate change.Energy consumption density The SSP2 pathway is the most aligned with China's current development status. The Group's scenario analysis includes an optimistic climate

change scenario where warming remains below 2oC—SSP 1-2.6 (with a projected 1.8oC increase by 2100 compared to pre-industrial levels) as

Indicator (Unit) 2020 2024 Reduction Compared

to the Baseline Year well as a pessimistic climate change scenario where warming exceeds 4oC—SSP 5-8.5 (with a projected 4.5oC increase by 2100 compared to pre-

industrial levels).Greenhouse gas emission intensity 52.8%

(tCO2e per million revenue)

105.849.9

Total energy emission density (tons of 26.3% mpact analysis of risks and response measuresstandard coal per million revenue) 17.5 12.9

Based on our preliminary assessment of risk factors and consideration of the impacts of a low-emission scenario (1.8oC) on carbon pricing

renewable energy generation and other transitional climate effects as well as the impacts of a high-emission scenario (4.5oC) on physical risk

Note: The baseline year for the above data is 2020. factors we have selected the following climate-related risk factors for further analysis and have outlined the corresponding response measures.

58 59Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Risk Type Risk Name Risk Description Risk Impact Responses

The Group’s production bases are Natural disasters such as heavy rainfall Formulate "Production Safety Accident Emergency Plan" to establish an emergency command system set up an emergency office and clarify emergency

located in the East China region floods and severe typhoons may personnel and responsibilities to achieve a rapid response to extreme weather. The Emergency Command Team is responsible for command operations and works

where extreme weather events have lasting effects on the Group. with the production department to organize personnel for safety inspections of key facilities and equipment while the logistics department ensures material

caused by climate change include but During extreme weather events the support.are not limited to typhoons heavy transportation of raw materials and Before extreme weather: Monitor weather changes closely conduct safety inspections and rectify hazards promptly. Prepare protective devices and emergency

rainfall droughts and floods. Under products may be disrupted employee equipment in advance ensure readiness of emergency teams and power supply plan employee commuting arrangements material and product transportation

a global 1.5° C warming scenario the commuting may become difficult and and schedule production and shipments in advance.Extreme weather frequency of once-in-20-years heavy risks such as power outages water

(Typhoons precipitation events is expected to supply interruptions and steam supply During extreme weather: Reduce production on typhoon/heavy rainfall days halt outdoor operations suspend work as needed assign personnel to monitor

floods heavy increase by 10% while the frequency disruptions may arise. For example weather conditions in real-time prioritize employee safety and ensure emergency supplies are adequate.rain) of once-in-100-years heavy typhoons may lead to production halts After extreme weather: Conduct damage assessments immediately draw lessons from the event minimize losses and accelerate production recovery.precipitation events is expected and property damage. Additionally

to increase by 20%. Under a 2° C during the rainy season red rainstorm Strengthen fixed asset management: Conduct regular inspections and maintenance of production equipment and facilities purchase property insurance for assets

warming scenario the frequency of warnings may result in obstructed in high-risk areas and implement additional protective measures to reduce losses from uncontrollable risks.once-in-20-years heavy precipitation material transportation difficulties Regularly analyze supplier risks develop stocking strategies for key raw materials optimize transportation methods and routes for critical raw materials and

events is projected to increase by in employee commuting damage to enhance supplier relationships to ensure supply chain stability.

22% and the frequency of once-in- company buildings and equipment

Utilize a purified water system to ensure the safety of production water and conduct regular quality testing for domestic and drinking water.

100-years heavy precipitation events affecting production schedules and

is expected to rise by more than 45%. increasing facility maintenance costs.Under extreme heat conditions the Group

Immediate A cold wave occurs when cold air may need to enhance ventilation and

risks causes a local temperature drop of cooling in production plants and offices

more than 8° C within 24 hours with leading to increased energy consumption

the daily minimum temperature and operational costs. Additionally

falling below 4° C. A heatwave is electricity demand surges may cause Prepare peak-load shifting electricity usage plans and work arrangements in advance during peak electricity demand periods.defined as a period of three or more power transmission disruptions affecting Develop backup energy solutions and pre-establish energy emergency response plans.consecutive days with maximum daily normal production.temperatures reaching or exceeding Schedule hazardous materials shipments in summer for early morning or late afternoon to avoid high-temperature periods and reduce fire risks.Under extreme cold conditions the

35° C. Due to human activities

Group may need to increase heating Regularly assess supplier risks develop stocking strategies for key raw materials and strengthen supplier relationships.the probability of cold waves has

in production facilities and offices Implement protective measures provide appropriate personal protective equipment enhance warning signage conduct specialized inspections

decreased to some extent but their

resulting in higher energy consumption of boilers steam systems and other equipment and check slippery areas such as staircases ramps and crossings.intensity has shown an increasing

(Heatwaves and operational costs. Frozen roads due trend. Cold waves may cause sharp Develop emergency response plans to prevent fires explosions leaks and poisoning incidents.cold waves) to cold weather may disrupt material temperature drops strong winds

transportation leading to insufficient raw Ensure factory buildings and fire protection facilities are insulated to prevent equipment damage from freezing.rain snow and freezing conditions

material supply and direct production

affecting the Group’s raw material Enhance winter safety training to ensure operational safety and conduct safety inspections of employee dormitories.delays or shutdowns. Dry weather

production logistics and power

conditions may increase the risk of Prepare heatstroke prevention and cooling supplies in summer and minimize outdoor work.operations. At the same time

fires explosions leaks and poisoning

heatwaves and compound extreme Include high-temperature emergency response training in employee programs and conduct drills for heatstroke and other heat-related illnesses.incidents. Extremely low temperatures

events (such as heavy precipitation

may cause equipment failures leading Continuously monitor employee health and conduct regular medical check-ups.followed by heatwaves) are becoming

to property damage and higher facility

more frequent and intense under

maintenance costs. Furthermore cold

global warming. The increased

waves and heatwaves may increase the

electricity demand for residential

prevalence and severity of cardiovascular

cooling during heatwaves may result

diseases malaria and heatstroke posing

in industrial electricity restrictions for

health risks to employees.businesses during certain periods.

60 61Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Risk Type Risk Name Risk Description Risk Impact Responses

The Group’s production process

The Group's water sources include

requires large amounts of water

municipal tap water. Water shortages may

which is used in dyeing and

force reductions in production capacity

finishing printing and equipment Set reasonable water conservation targets and implement improvement measures.temporary shutdowns or the adoption of

cleaning. As global water scarcity

Water scarcity additional water management measures Establish water conservation goals reduce freshwater consumption and increase wastewater reuse.worsens particularly in drought-

such as water recycling and water-saving

prone and water-stressed regions Develop a comprehensive water resource management system and assessment framework.technologies. This may lead to higher

water shortages pose an increasing

production costs or lower operating

risk to the stability of textile

revenue.production and cost management.Long-term risks

According to the China

Meteorological Administration’s

Global Surface Temperature Dataset Temperature variations may affect the

Analysis global warming has stability of certain chemical reagents

continued since 2015 with records requiring adjustments to production

for the hottest year on record being parameters or additional temperature Implement energy-saving renovations for air conditioning and ventilation systems in production facilities and offices to improve energy efficiency.repeatedly broken. The rise in control measures thereby increasing

Provide adequate heat protection materials for employees in summer and conduct annual health check-ups.average temperature due to global production costs. Rising temperatures

Rising average

climate change may bring multiple necessitate enhanced ventilation and Include high-temperature response training in employee programs and conduct emergency drills for heatstroke and other heat-related illnesses.temperature challenges to textile enterprises cooling in production plants and offices

including production activities raw Avoid outdoor work during midday high-temperature periods to ensure safe production.leading to higher energy consumption and

material supply product quality operational costs. Additionally increased Plan peak-load shifting electricity usage in advance.control and employee health and temperatures may raise the likelihood of

safety. Temperature changes may

heat-related illnesses such as heatstroke

impact fabric and apparel production

processes storage conditions and reducing workforce productivity.supply chains.Establish a greenhouse gas emission management framework set energy-saving and carbon reduction targets and gradually reduce carbon

Carbon emission rights refer to the emissions intensity and total emissions. Form an Energy Saving and Emission Reduction Task Force to conduct self-assessments and optimize

legal right of enterprises to emit reduction measures. Additionally require department and workshop managers to identify high-power equipment and major pollution sources

greenhouse gases with each company document findings and further analysis and improvement to ensure that beyond meeting the Group’s emission reduction targets emissions are

being allocated a certain quota by the further minimized.government. Although the Group is

As carbon emission pricing rises the

not currently covered under China’s Strengthen energy efficiency management across production operations including reviewing energy-consuming equipment and energy use

Group's carbon trading expenditures

national carbon emissions trading replacing high-energy-consuming equipment with energy-efficient alternatives upgrading high-energy equipment and optimizing production

may continue to increase impacting

system in a low-emission scenario if equipment to improve energy efficiency and reduce greenhouse gas emissions.its financial performance. Moreover

Increase in the country continues to implement

Policy & higher carbon pricing significantly affects Promote resource recycling by installing recovery systems (e.g. reclaimed water reuse ammonia recovery alkali recycling).carbon emission stricter emission reduction policies and

regulatory risks the power and chemical industries Improve energy structure by increasing the use of clean and renewable energy (e.g. expanding photovoltaic power generation projects) and

pricing introduces carbon trading policies for

potentially leading to rising energy prices reducing reliance on traditional fossil fuels.the textile industry the Group may be

or raw material shortages which would

included in the carbon quota trading Enhance training and awareness programs to improve employee energy-saving awareness and operational efficiency preventing unnecessary

indirectly increase the Group's operating

market. As a result the Group’s energy waste.costs.production facilities may need to adopt

Strengthen energy management and assess energy consumption in production workshops.more aggressive emission reduction

measures or participate in carbon Improve production technology to enhance improve the first pass rate of products thereby reducing raw material and energy consumption per

trading to ensure compliance with unit product.greenhouse gas emission regulations. Adopt green operations by promoting paperless offices to reduce greenhouse gas emissions from business activities.

62 63Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Low-carbon practices Energy management

Photovoltaic power generation projects We are conducting energy-saving

upgrades for electromechanical

As of 2024 the Company's installed solar photovoltaic power generation facilities have supplied a total of 70.26 MW grid-connected electricity equipment researching and

accounting for 13% of the annual electricity consumption within the total installation scope reducing carbon dioxide emissions by promoting upgrades for fans and

approximately 78000 tons. pumps implementing systematic

electricity-saving projects and

accelerating equipment renewal

and replacement and prioritizing

the adoption of energy-efficient

Energy system optimization and upgrades equipment.We have implemented optimization and upgrades for the steam pipeline

network enhancing steam condensate recovery and utilization. Additionally

we have carried out a softened water preheating modification project to

further advance waste heat recovery enabling an annual steam savings of

nearly .Photovoltaic power generation across all industrial parks 20000 tons

Application of low-carbon technologies

Waste heat recycling

The Company's magnetic levitation fan integrated

energy-saving technology has achieved a promotion More than 99% of liquid ammonia is recycled through

rate of over 80%. the separation of oil and ammonia and that of oil and

water during product processing.Liquid ammonia recycling

Maglev centrifugal blowers

Resources management

Luthai integrates sustainable development principles into the entire production and operational process continuously strengthening resource

management and adhering to green development concepts. We strictly comply with the Energy Conservation Law of the People's Republic of

China the Water Law of the People's Republic of China and the Law of the People's Republic of China on the Promotion of Clean Production

among other relevant laws and regulations and have established an energy management system.The Company has formulated the General Resource Utilization Management Process and the Environmental Operation Management Regulations Alkali balance reuse

as the Group-wide guidelines for resource utilization management which all entities within the Group must strictly follow. Additionally each Following the alkali recovery project the Company launched the alkali balance reuse project this year to promote waste resource utilization

production plant has developed and implemented its own Resource Management System and Energy Conservation and Emission Reduction and green low-carbon practices. This initiative eliminates the high-energy consumption multi-effect evaporation recovery model by balancing

Management System in accordance with its specific operational conditions. These systems facilitate standardized and systematic resource alkali production and usage. In Phase I the alkali recovery diluted alkali storage tanks were connected to the wastewater treatment facility

utilization management significantly enhancing resource efficiency. to substitute diluted alkali for concentrated alkali ensuring alkali availability at the wastewater treatment station. In Phase II the Company

Furthermore the Company has set annual water conservation and energy consumption targets. By improving management practices and installed in-workshop alkali blending and reuse devices where diluted alkali is filtered and purified then blended with concentrated alkali

to produce standard alkali which is then reused in desizing and scouring alkali-consuming machines. Both project phases have achieved

upgrading technologies we continuously optimize resource utilization methods conduct regular audits of resource consumption and enhance

automated control gradually replacing multi-effect evaporation alkali recovery equipment to reduce energy consumption. The project saves

overall resource efficiency to ensure the achievement of sustainability goals. RMB1579000 annually.

64 65Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Water footprint tracking

Resource management

Lu Thai Textile actively conducts water resources management and makes more efforts in the recycling of water resources. Through water

treatment and recycling water conservation planning and other measures the Company minimizes tap water consumption alleviating regional

water supply pressures and serving as a benchmark example in the industry.Water conservation

The company's energy and water saving targets

andbreakdown table for 2024

Department Energy saving target(tons of standard coal) Water saving target (m

3)

The Company has established a long-term

spinning 81 77 mechanism for water conservation formulated

plans for unit water consumption and annual water

Bleaching and dyeing 91 8374 conservation targets assigned and implemented water conservation goals to each section and

weaving 64 266 working team and clarified responsibilities for all levels.Fabric inspection 0 20 In 2024 with the Company's own wastewater

treatment plant the Group's reclaimed water

Finishing 188 2979 manufacturing equipment had a design capacity

of 20000 tons/day and the use rate of reclaimed

Inspection and packing 0 16 water in the Group's major water-consuming plants

was as high as more than 52%.Garment production 4 229

Sewage treatment

The Company has established four plant wastewater treatment

stations and one municipal wastewater treatment plants. The

plant wastewater treatment stations adopt the A2O methods and

the quality of the discharged water is below the concentration

limit for indirectly discharged water specified in the Discharge

Standards of Water Pollutants for Dyeing and Finishing of Textile

Industry (GB4287-2012) and compliant with the requirements in

the Announcement on Adjusting the Implementation Requirements

for Some Indicators of GB4287-2012. The municipal wastewater

treatment plant adopts a technique that integrates "hydrolysis

and Orbal oxidation ditches" and has a capacity of treating

approximately 120000 cubic meters of wastewater every day into

water with a quality that is better than the A standard of Level 1

specified in the Discharge Standard of Pollutants for Municipal

Wastewater treatment Plant (GB18918-2002).The Company adheres to water footprint tracking monitoring water consumption in both production and daily operations to control water

usage and minimize waste.

66 67Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Atmospheric pollutant management Biodiversity protection

Luthai Textile is committed to biodiversity conservation and strictly complies with the Forest Law of the People's Republic of China the

The Company actively conducts atmospheric pollutant management to lessen the environmental Regulations on the Implementation of the Forest Law of the People's Republic of China the Forest Logging and Regeneration Management

burden brought by its production and operation to the society as much as possible. During this Measures the Regulations on the Protection of Wild Plants of the People's Republic of China the Wildlife Protection Law of the People's Republic

Reporting Period in the factory-bound fugitive exhaust gas the concentration of hydrogen sulphide of China as well as the United Nations Convention on Biological Diversity and other biodiversity-related laws regulations and international

was 0.005 mg/m3 that of ammonia was 0.08 mg/m3 that of particulate matter was 0.28 mg/m3 conventions.that of non-methane hydrocarbon was 1.3 mg/m3 and that of odor was 13 (dimensionless). This To protect biodiversity we assess the dependence and impact of our business operations on natural resources organize tree-planting activities

is better than the discharge standard which specifies that the concentration limit for hydrogen for employees promote paperless offices and continuously work to reduce the negative impact of our operations on biodiversity. We actively

sulphide is 0.06 mg/m3 that for ammonia is 1.5 mg/m3 that for particulate matter is 1.0 mg/m3 promote sustainable use of natural resources and contribute to ecological balance maintenance.that for non-methane hydrocarbon is 2.0 mg/m3 and that for odor is 16 (dimensionless).Waste management

The Company temporarily stores and disposes hazardous waste that it generates in strict compliance with the Directory of National Hazardous

Wastes and the Standard for Pollution Control on Hazardous Waste Storage. It manages hazardous waste in different categories separately by

establishing hazardous waste storehouses and corresponding supporting facilities while it hires qualified hazardous waste disposal agencies

to transfer hazardous waste and prohibits the appropriation of hazardous waste. The main hazardous waste generated in the production and

operation of the Company includes waste oil waste oil barrels waste paint buckets waste detergent barrels liners contaminated by chemical

dyes waste lead-acid batteries laboratory waste liquid etc.; the main non-hazardous wastes brought by the production and operation is the March 12 marked the 46th National Tree Planting Day in China. The Company's Youth League Committee organized Youth League

sludge. representatives and young volunteers from various departments to participate in a tree-planting event hosted by the Zichuan District

Communist Youth League Committee. Employees personally planted saplings not only adding vibrant greenery to the bright March

landscape but also embodying the concept of ecological protection and harmonious coexistence through their actions.In 2024 The Company's Information Department launched the Centralized Printing and Paperless Project. In 2024 this initiative helped

Company processed 36 tons of hazardous waste departments save a total of 76500 sheets of printing paper.and 11420 tons of non-hazardous waste.

68 69Employee's Rights and Benefits/

Building a Harmonious Workplace

Together

Employees are the driving force and innovation source of companies. Discovering the

potential and stimulating the ownership spirit of employees is the key to the success of

enterprises. Lu Thai Textile implements a humanistic culture centered on caring employees

meeting their needs to the greatest extent possible while ensuring that employees have a

healthy and safe workplace. We provide employees with a platform to show themselves

and improve their abilities consolidate their knowledge and skills enrich their leisure

life and assist employees in solving difficulties. We truly care for and love our employees.UN Sustainable Development GoalsChairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Respect and equality

Indicator (Unit) 2022 2023 2024

Luthai Textile has always adhered to the principle of equal and friendly employment. It strictly complies with the laws regulations and Employee age

requirements of regulatory authorities of the countries where it operates and actively supports the international conventions including Total number of employees aged 9866 9671 9814

the International Covenant on Economic Social and Cultural Rights and the Elimination of Discrimination in respect of Employment and under 30 (person)

Occupation so as to build an equal friendly occupational platform for employees. Proportion of employees aged under 43 42 41

30(%)

The Company believes that talents are the basis for the operation and sustainable development of companies. As to the recruitment and

Total number of employees aged

retention of talents the Company adheres to the "all-inclusive" concept accepts all talents and promises not to determine employees' salary 13162 13179 14174above 30 (person)

and rank based on their gender age nationality ethnicity religion color language domicile place and other personal characteristics unrelated Proportion of employees aged above 57 58 59

to work. The Company respects the rights of every employee and provides equal and free development space for every employee. 31 (%)

Education background of

employees

Bachelor or above (person) 1400 1319 1555

Junior college (person) 4523 3726 4517

High school or below (person) 17105 17805 17916

Nationality

China (%) 54 51 46

01 02 Foreign employees (%) 46 49 54

Recruitment is conducted without The Company is committed to ensuring

discrimination based on gender that gender beliefs ethnicity and other

race nationality or other factors. non-work-related factors do not influence Caring for female employees

employees' salaries or promotions. The Company always pays attention to the rights and development of female employees and always puts special protection for female

03 employees into practice. Therefore the Company has formulated the Management Procedure for Protecting Female Employees carried out various publicity education and entertainment activities to promote the physical and mental health development of female employees

enhance their confidence in overcoming the dual pressures of work and life and enable them to maintain a good state in professional

competition.A fair competition mechanism is adopted for Measures taken:

promotion. The performance abilities and

potential of employees will be considered to The Company has refused gender discrimination and recruited females under equal conditions.Employee diversity select the best ones. The Company has ensured career development of female employees and provided broader development space for

female employees.The Company has established a female employees' committee to assist female employees in solving their difficulties of

life and work and safeguarding their rights and interests

Indicator (Unit) 2022 2023 2024

A psychological counseling room has been established and in 2024 a total of 27 exchange and discussion sessions were

Employee diversity organized for female employees.Total number of incumbent employees

23028 22850 23988 In 2024 16 training sessions were conducted for female employees with approximately 1000 participants. The training (person) primarily consisted of offline classroom sessions covering women’s health maternal and child care and mental health

Total number of male employees

9736 9317 10432 awareness along with specialized training for female-oriented activities. The content was designed to meet the practical (person) needs of women making it well-received among female employees.

Proportion of male employees (%) 42 41 43 Various activities such as reading writing painting paper-cutting and pastry-making were organized to enhance the

Total number of female employees overall skills of female employees with prizes awarded to outstanding participants.(person) 13292 13533 13556 Maternity rest rooms were set up to provide comfortable and convenient resting spaces for expectant mothers with four

Proportion of female Employees (%) 58 59 57 of these facilities recognized at the district level.In 2024 a total of 2611 married female employees underwent health check-ups with total examination costs exceeding

RMB70000.

72 73Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Mental consultation room

Mom's cabin

Cultural and recreational activities

Series of Activities on the International Women's Day on March 8

Awareness campaigns and knowledge training Physical examination for female employees

74 75Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Human rights and labor Complaint and Suggestion Channels

Compensation and benefits □ Every year employee representatives are elected through employee elections and the Labor

Union regularly holds employee representative assemblies to promote activities of the Labor

The Company has established a comprehensive compensation and benefits system providing employees with basic pension insurance Union and communicate with employees

medical insurance work-related injury insurance and unemployment insurance in accordance with the law. Employees are also entitled to paid □ Suggestion boxes are set up in various plants and departments of the Company to collect

annual leave home leave marriage leave maternity leave work-related injury leave and other benefits in line with national standards. The employees' opinions on the Company's policies management processes and salary benefits.Company actively enhances employee communication channels by establishing and improving mechanisms such as labor unions employee The Labor Union organizes them once a month and provides feedback to the Company's senior

representative meetings and grievance procedures allowing employees to voice their concerns and suggestions regarding compensation and leadership to discuss improvement plans

benefits ensuring the effective protection of their rights. □ Tel.: (86) 533-5261634

SMS: 18560301315

Indicator (Unit) 2022 2023 2024

Email: gonghui@lttc.com.cn

Employment contract signing rate (%) 100 100 100 □ Chairman Reception Day on the 25th of each month—direct face-to-face communication with

employees.Social insurance coverage (%) 100 100 100

Signing rate of collective bargaining 100 100 100

agreement (%)

Luthai Textile’s compensation system consists of hourly wage and piece-rate wage structures with salaries balanced according to job roles.Based on this the Company continuously improves salary structures and refines performance standards to maximize employee earnings. Occupational health and safety

Equity incentive program The Company pays high attention to its employees' occupational health and safety so it has established and improved the management system

of occupational health and safety implemented risk control measures and actively inspected and responded to occupational disease hazards

To further establish and enhance the Company’s operational mechanisms improve the incentive and restraint system fully mobilize so as to ensure that each Luthaier's health and safety are free from impairments.employees' enthusiasm and inspire the motivation and creativity of the Company’s and subsidiaries’ management teams and core

technical (business) personnel Luthai Textile has implemented two phases of equity incentive plans for directors senior management middle

management and core technical (business) personnel.The 2011 Restricted Stock Incentive Plan granted restricted stock to 344 participants totaling 14.09 million shares. This Safety first prevention-oriented and Prioritize safety before production; no production

comprehensive management. without safety. Strictly adhere to operating procedures to prevent safety accidents.included 16 directors and senior executives (1.6 million shares) 161 core management personnel (9.64 million shares)

Luthai EHS

and 167 technical and business backbone employees (2.85 million shares). This plan was fully implemented in 2014.Philosophy

Comply with environmental laws and standards and

The 2021 Restricted Stock Incentive Plan initially granted restricted stock to 750 participants including 11 directors Source management and green manufacturing. fulfill corporate social responsibility in environmental Emphasize prevention and a combination of protection. Ensure management practices align

(excluding independent directors) and senior executives and 739 middle management and core personnel. An prevention and control measures. with compliance requirements for a safe working environment.additional reserved grant was issued to 343 participants including seven senior executives and 336 middle management

and core personnel. The initial and reserved grants under this plan amounted to 24285000 shares and 5838000 shares

respectively. This plan was fully implemented in 2024.Measures taken

Before going to their posts new employees have all undergone pre-job physical examinations to avoid personnel with occupational

Human rights protection contraindications from working in the relevant posts; employees have undergone on-the-job physical examinations and their work will be

allocated according to the results; and when leaving their posts employees have undergone post-job occupational physical examinations

In interview process the Company actively examines identity cards diplomas etc. to prevent child laborers or underage workers who to ensure that employees leave their posts in healthy condition.have not finished legal compulsory education from being recruited by mistakes.The Company has conducted regular occupational health education and training for employees and established occupational health

The Company is committed to putting an end to all forced or compulsory labor. Employees are free to leave the workplace after completing surveillance archives for employees realizing the standardized management featuring "one archive for one person".the work needed to be done within standard working time. The declaration system must be implemented for overtime work to ensure that

overtime work is a voluntary act of employees. Conduct annual occupational hazard assessments in key areas with immediate rectification for any non-compliance.In the course of production and operation cooperating with the local government or third-party institutions the Company actively carries The Company posts warning signs and occupational hazard notification cards in prominent positions in the workshop.out due diligence on human rights protection. The Company regularly maintains and repairs occupational hazard protection facilities to ensure their integrity and effectiveness.To ensure that the opinions of employees on the Company's management are fully conveyed and to encourage their participation the The Company conducts emergency rescue drills once or twice a year for relevant departments and workshops to ensure timely handling

Company's Labor Union collects employee opinions and suggestions through various channels. of hazards.

76 77Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Provide employees exposed to occupational hazards with standardized and effective personal protective equipment (PPE) ensuring

regular procurement distribution and supervision of PPE usage to prevent occupational diseases. Install washing stations in areas

Occupational

handling corrosive substances such as acids and alkalis and upgrade occupational disease prevention facilities through maintenance and

Hazardous Factors Countermeasures

improvements.Organize first aid and heatstroke prevention training to enhance employees' emergency response skills. In 2024 the Company conducted * Take airtight ventilating and dedusting measures for cotton blending machines and

scutchers in pre-spun process.

22 first aid training sessions and 21 heatstroke prevention training sessions.

* Adopt the approach of wet sweeping for the workshop to take away the dust

The Company popularizes health care knowledge each month and provides first-aid medical kits for employees with first-aid medicine Dust accumulated on the surface as much as possible

supplemented for 271 times on average per month in 2024. * Regularly clean the air duct

* Distribute dust masks that conform to international specifications

The Company distributes heatstroke prevention drugs in summer for convenient use by employees.* Distribute items for heatstroke prevention for high-temperature posts in the

High temperature workshop

and high humidity * Add Auricularia auricula and pig blood curd to workshop meals to enhance

employees' ability to defend against occupational diseases

* Adjust the air supply and exhaust volume in the workshop

Noise and vibration * Equip employees with disposable noise-reducing earplugs and

replace them regularly

Talent management

Talent acquisition

Luthai scientifically forecasts talent demand based on the Company’s strategic positioning business development and current talent pool

enhancing talent selection methods and expanding recruitment efforts. By utilizing multiple recruitment channels the Company attracts

professionals from various fields ensuring a strategic talent reserve to maintain long-term competitiveness and foster a corporate environment

where employees can fully utilize their skills and potential. At the same time the Company actively engages in international talent recruitment

First Aid Training in the United States Italy Japan Vietnam Cambodia and Myanmar to support its overseas business expansion.Additionally to promote internal talent mobility and encourage diverse career development employees can apply for internal job postings.Those who meet job requirements and pass interviews can transfer positions following the Company's recruitment procedures. Employees and

departments can also submit internal transfer applications based on operational needs.This year to attract outstanding graduates the Human Resources Department organized a Summer Camp Program for university students.Students from Jiangnan University Dalian Polytechnic University Qingdao University and other institutions were invited for internships

providing them with an in-depth understanding of the Company. For newly hired university graduates the Company conducted onboarding and

development training and regularly organized welcome banquets and discussion forums to enhance their sense of belonging and improve talent

retention rates.Facility Setup

Personal Protective Equipment Summer camp program

78 79Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Development of reserve talent pool

The Company has formulated and implemented the 2022-2026 Key Position Recruitment Plan establishing the Three-Year Career Development

Plan for Undergraduate and Above Employees of Luthai Group for newly recruited key position personnel. Additionally each department has

been tasked with developing the Secondary Talent Pool Management Measures to achieve position-specific recruitment and targeted training

for key roles. In 2024 totally 275 key post personnel were recruited and totally 148 second-level talents were reserved for all departments.Excellence Plan

Senior managerial personnel

Elite Plan Research and study engineering

Middle-level managerial personnel

Flight Plan Re-building engineering System management

Grass-roots managerial personnel Managing operations

Set-sail Plan Incubation engineering Department manager

Onboarding personnel Managing the department ·Performance-oriented

Cultivation engineering Professional backbone ·Cross-department coordination

Managing others

This year's new employee ·Maximizing the Company's

benefits

Self-management ·Considering both individual and ·Giving strategic support

team Over five years Training for section chiefs and group leaders Customer-led SST project training for the Company's management personnel

·Basic skills training ·Individual's success and team's

success Three to five years

External personnel training

Within a year One to two years In 2024 the Company organized two enterprise internship programs for teachers held during winter and summer breaks. A total of nine

vocational teachers from seven regions across the country participated including eight teachers in a ten-day skills training program and one

teacher in a 30-day on-the-job training program. The participating teachers specialized in textile design fashion design and technology textile

engineering and modern textile technology.Employee training and development

Luthai Vocational Training School is dedicated to serving regional economic and social development aligning with market demand and

focusing on employment promotion and industry development needs. The school is committed to cultivating skilled professionals and provides

training in employment skills skill enhancement and competency development for corporate employees unemployed individuals rural

migrant workers and university students.Internal employee training

The Company offers professional training courses in both vocational skills and management skills. A total of 23988 employees took part in the Teacher enterprise internship

vocational training in 2024 with a coverage rate of 100%.Unemployed worker training

Indicator (Unit) 2022 2023 2024 To help local unemployed individuals secure better job opportunities Luthai Vocational Training School provides dual-assurance training

Training participants (person) 23028 22850 23988 programs including specialized vocational skills training and job-specific skills enhancement training. After training participants take

certification exams and those who pass receive certificates. In 2024 a total of 178 unemployed individuals received training with 45 earning

Average training hour (hour) 56 56 56 Specialized Vocational Ability Certificates and 58 obtaining Skill Level Certificates.Training coverage rate (%) 100% 100% 100%

Onboarding training

Tea Art Training Electrician Training Pastry Training

80 81Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Since 2003 the Company has established an internal professional title evaluation appointment and allowance system actively promoting

Training needs and satisfaction survey

the values of honoring labor valuing skills and fostering creativity. This has created a corporate culture that emphasizes skill development

This year the Company has placed great emphasis on talent training. At the beginning of the year a survey questionnaire was distributed to encouraging employees to learn and master professional skills. The Company has taken a leading position in the industry in cultivating and

accurately identify employee training needs covering management skills professional techniques and logistical services. The training sessions evaluating skilled talent. The internal professional title evaluation and appointment system has become a key platform for implementing the

attracted over 20000 participants. Additionally by implementing a self-evaluation mechanism the Company effectively integrated internal and Company's philosophy of valuing nurturing and utilizing talent.external training enhancing employee knowledge and skills. The training satisfaction rate exceeded 95% significantly improving employee

capabilities and empowering high-quality corporate development thereby contributing to the establishment of a high-quality human resource

Qualification support

strategic system.This year 16 employees were encouraged to take the Certified Safety Engineer Examination with two

employees passing and obtaining certification.Multi-dimensional promotion mechanism

Promoting skills development

The Company implements horizontal and vertical dual channel development (job promotion and cross-job promotion) with promotion in the Luthai Textile actively carries out various skill competitions and encourages its employees to promote their professional and technical

directions of management line and professional lines (the former is achieved through job changes while the latter is achieved through internal levels through competitions and to define their vocational objectives and orientations; the Company also encourages its employees to take

professional title appraisal). Targeted training is carried out based on personnel characteristics and personal preferences achieving multi- vocational qualification examinations to transfer what their have learned into actual output. Luthai also constantly facilitates the development

dimensional development space for employees. of its employees toward high-grade precision advanced and professional direction and drives the Company to stride toward a learning-

oriented skill-oriented and innovation-oriented world-class enterprise.Promotion Plan for Production Promotion Plan for Department

Frontline Positions Positions The Company’s Thirty-fourth Session

of Technical Demonstration and

Competition

Plant management personnel Department management personnel

Group leader Reserve personnel

Reserve talents Sub-group leader

Training

Excellent employee Excellent employee

Versatile employee Department employee

Skilled worker

Frontline employees

Competition

In 2024 the Company appointed two Chief Technicians 13 Senior Technicians and 82

Technicians; 399 Senior Skilled Workers 520 Intermediate Skilled Workers 596 Junior Level

2 Skilled Workers and 769 Junior Level 1 Skilled Workers. During their tenure they receive

a monthly allowance of RMB2500 RMB1500 RMB1000 RMB500 RMB300 RMB200 and

RMB100 respectively.Award Ceremony

The Company appointed four Senior Engineers five First-Class Engineers 29 Engineers

365 Assistant Engineers and 193 Technicians. During their tenure they receive a monthly

allowance of RMB1500 RMB1000 RMB800 RMB400 and RMB200 respectively.From April to July 2024 the Company held the thirty-fourth session of activity of technical demonstration and competition. A total of 47

The Company appointed three First-Class Designers three Designers 21 Assistant Designers companies and 8150 personnel covering 597 types of work in total took part in the competition. Through the processes of publicity and

Appraisal and appointment and three Design Assistants. During their tenure they receive a monthly allowance of mobilization training and learning post drills and preliminary and final competitions finally there were 30 champions of single skills of

of professional titles RMB1000 RMB800 RMB400 and RMB200 respectively. departments 3230 winners of technical demonstrations and competitions 636 "excellent versatile workers" and 97 "excellent teams"

and they have all obtained honor certificates bonus and presents. Technical demonstrations and competitions have aroused employees'

enthusiasm to learn technologies dig into professions practice skills and work as artisans through training and learning post drills and skill

competition hence achieving the objectives of promoting production safety management benefits and development through competitions.

82 83Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

[Case] The Company’s Activity of Evaluating the Excellent Emphasis on employees' living and dining conditions

The Company launched the activity of Luthai has more than 20000 employees. The Company attaches great importance to the quality and services of employees' board and lodging

evaluating the excellent in order to further and regularly carries out satisfaction surveys of employees' board and lodging each year to constantly improve logistics management and

promote the excellent corporate culture services to strive to provide employees with nutritious diets and convenient living conditions.of the Company commend outstanding

collectives and employees who performed

outstandingly in the past year and motivate

everyone to innovate their performance Continuously enhance employees' job skills by adhering to the principles of "standardization and regulation" in

achieve new breakthroughs and make food preparation. Advocate for quality awareness among all employees starting with basic dishes optimizing

new contributions in the next year. A cooking methods mastering heat control ensuring precise seasoning and maintaining stable food quality.total of 11313 participants took part

in the evaluation process. Through a Develop on-duty meal menus through a combination of intelligent planning and employee surveys ensuring the

graded assessment the final selections accumulation of raw data to guarantee menu diversity balance and seasonality.included 2781 "Advanced Production

(Work) Individuals" 112 "Company Model Display QR codes on dining tables for feedback collection utilizing multiple channels to gather opinions and

Employees" nine "Labor Models" and 41

"Advanced Collectives." The total bonus suggestions and continuously improving food quality.awarded amounted to RMB2.97 million. Promote the upgrade of smart dining facilities enabling diversified intelligent management methods such as card

QR code and facial recognition payments self-service card replenishment intelligent food sampling morning

health checks and AI monitoring improving restaurant attendance rates and convenience.In 2024 the meals amid shift were upgraded by including one fried product per meal to enrich the diets of

Benefits and care

frontline employees.We have always believed that "employees are the most valuable resource of an enterprise" and only with a stable workforce can a company The Company compiles a menu according to seasonal changes to ensure a cool taste in summer and hot soup

achieve better performance. Therefore we continuously enhance employee satisfaction and sense of belonging striving to meet various and dishes in winter. In summer meals amid shift are added with seasonal fruits and mung bean soup to prevent

employee needs to the greatest extent possible. employees from heatstroke and reduce heat from employees.We provide our employees with a wide range of non-monetary benefits such as occupational health check-ups employee wellness check-ups Establish a provincial-level healthy enterprise to ensure food safety create a healthy dining environment and

shuttle services travel allowances and company dormitories. Additionally we have established special benefits to accommodate employees continuously promote health awareness by advocating "low salt low sugar and low fat" prioritizing health.with specific needs such as nursing rooms specialized health check-ups for female employees and hardship assistance funds. Details are

provided in the table below: To demonstrate the Company's humanistic care a birthday cake is made and provided for employees free of

charge. Launch a cake ordering and sales service to better serve employees including large-scale and customized

Work Support Health Housing Dining Leisure Activities cake production.·Travel allowance ·Employee wellness ·Company dormitories ·Employee cafeteria ·Employee activity center In 2024 employee dining satisfaction reached 82.69%.·Communication check-up ·Government talent ·Free on-duty meals ·Library

allowance ·Free heat prevention apartments ·Convenient pastries and ·Band

·Shift allowance medicine ·Housing subsidy fruits ·Team-building activities

·Overseas allowance ·Cooling fruits ·Social events

·Shuttle service ·Convenient medical

rooms

Protection for Female

Holidays Employees Talent Support Assistance

·Nursing room

·Traditional festival ·Academic subsidy for ·College assistance for

·Specialized health introduced talents

gifts employees' children

check-ups for women ·Talent skill

·Annual party lottery ·Consolation gifts for

·Special training for improvement award

·Large-scale prize- female employees ·Postdoctoral employees in hardship

winning activities ·Psychological workstations ·Serious illness

counseling room for ·Equity incentives for assistance fund

key employees

female employees

In terms of statutory benefits we provide employees with statutory holidays rest days sick leave work injury leave marriage and bereavement

leave maternity leave paternity leave breastfeeding leave and annual leave in accordance with national or local regulations. Additionally

we contribute to employees' social insurance (including basic pension insurance medical insurance unemployment insurance work injury

insurance) and housing provident fund. Diverse Dishes

84 85Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Employee apartments Supermarket

Pastries

Employee assistance and support

Golden Autumn Scholarship

The "Golden Autumn Scholarship" program is an initiative that upholds traditional virtues fosters a spirit of generosity and strengthens family

bonds. It is a demonstration of our care and support for employees as well as a program that contributes to the Company's development

while reflecting employees' aspirations. This initiative has become an important platform for Luthai Group to carry out meaningful actions

for employees by addressing their needs solving difficulties and delivering warmth. This year 234 employees' children achieved outstanding

academic results and were admitted to universities across the country. Their success is not only a source of pride for their families but also

Scholarship Awarding Ceremony of the Golden Autumn Scholarship Program

Distribution of Cakes to Employees Relief of Employees in Difficulties

Implementing the people-foremost policy and caring for employees have always been an important part of the Company's corporate culture.Air conditioners and free Wi-Fi are available in all dormitories in the Company The grass-roots branches of the Company visit and comfort employees every year go deep into the front line of production and understand the

Each floor in the apartment is equipped with chess and card room television hall and smoking room living condition of employees through multiple channels. They also take the responsibility of "the first insider" actively find out the state of mind

of employees and take the initiative in solving their problems. The Company has established a bailout foundation and distributes assistance

Each building in the apartment areas is equipped with a fully automatic coin-operated washing machine funds to employees with family difficulties every year hence helping employees to go through their difficult pass. In 2024 the Company’s labor

24-hour unmanned supermarkets are set up in the apartment areas to provide employees with conditions of union provided financial assistance to 86 employees in need distributing a total of RMB214000 in relief funds.

convenient and fast shopping

The apartments provide the services of cleaning working clothes and articles of bedding free of charge and set

up locations for replacing articles of bedding to achieve that such articles can be replaced whenever they are

dirty

Free drying and storage of bedding are also provided for employees during seasonal changes

Each park area is equipped with bathing facilities so that employees can have baths conveniently

84 disinfectant is sprayed on dormitories and bathrooms every day to ensure a healthy living environment

Independent shower rooms in university student apartments Distribution of Relief Funds

86 87Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Summer-vacation daycare program

To address the challenge of childcare during the summer break enhance employees' sense of well-being and ensure a safe enjoyable and

meaningful summer for their children the Company organized a summer daycare program from July 12 to August 24 2024. A total of over 260

employees' children participated. The daycare program was conducted in two sessions each lasting 20 days and featured four themed weeks:

"Creativity & Craftsmanship" "Traditional Chinese Culture" "Labor & Work Ethics" and "Safety & Protection." With a diverse and engaging

curriculum the program incorporated activities such as recitation painting calligraphy handicrafts film appreciation and singing helping

children enhance their imagination creativity and social skills through an edutainment approach.Concert Performance Scene

[Case] The 37th Anniversary Celebration – Series of Cultural and Sports Activities

On June 1 2024 the "Forging Ahead on a New Journey Uniting Strength for a New Chapter" Luthai Group 37th Anniversary Celebration Series

of Cultural and Sports Activities was held at Luthai Cultural Park. The Chairman of the Company's labor union attended the event and presented

awards to the winning teams.The event featured activities such as group rope skipping tug-of-war and mixed basketball shooting. Each team carefully prepared worked

closely together maintained uniform coordination and encouraged one another demonstrating the positive united and collaborative spirit of

Luthai employees in the new era. The event was filled with enthusiasm and joy celebrating the 37th anniversary of Luthai Group.Daily Activities and Performance of the Summer Daycare Program

Enriching employees' cultural and recreational life

The Company regularly organizes various cultural sporting and recreational activities to enrich employees' spare-time life boost employees'

mental outlook and lead employees to achieving the balance between work and life hence promoting employees' sense of belonging to the

enterprise and enhancing the Company's cohesion.[Case] "Tribute to Strivers A New Symphony" – 2024 New Year Concert

On February 23 2024 the "Tribute to Strivers A New Symphony" Luthai Group 2024 New Year Concert was grandly held at Luthai Academy.The concert featured a full performance and accompaniment by the Luthai Textile Orchestra.The event was divided into three chapters with the first chapter "Song of Struggle" featuring performances such as Chinese Dragon Everything Anniversary Celebration Activities

Goes Well Three Hundred and Sixty-Five Miles and the orchestral ensemble Festive Dance. These performances conveyed the dedication and

perseverance behind every achievement amid a complex and ever-changing external environment highlighting the extraordinary Luthai spirit

and strength.

88 89Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

[Case] The 26th Session of Employee Basketball League

In May 2024 the 26th Luthai Group Employee Basketball League was held. Along with over 100 referees athletes and employee representatives.The competition was divided into three stages: group elimination round-robin and finals. On the court teams from various departments

competed fiercely under the principle of "friendship first competition second." Players ran collided and jumped with full concentration

their movements flashing under the sunlight earning rounds of applause from the audience. After three days and 38 intense matches among

12 teams the championship game took place. In the end the Lufeng Weaving & Dyeing Team won the championship while the Security

Department Team secured second place.Swimming Competition Scene

[Case] The 11th Employee Choir Competition in Celebration of the 75th

Anniversary of the Founding of the People's Republic of China

On the evening of September 25 2024 the Luthai Group’s 11th Employee Choir Competition with the theme of "United in Strength Advancing

with Determination" celebrating the 75th anniversary of the founding of the People's Republic of China was held at Luthai Cultural Park.The event was attended by distinguished guests including a member of the Party Committee and Vice President of Inner Mongolia University

of Technology the Dean of the School of Light Industry and Textiles the Party Secretary and Dean of the Luthai Textile & Apparel College at

Shandong University of Technology the Secretary and Director of the Standing Committee of the People's Congress of Zichuan District the

Basketball Match Scene

Secretary and Chairman of the Zichuan District CPPCC the Principal of Zibo School of Technology as well as Company leaders such as the Party

Secretary Chairman and President. Nearly a thousand employees were present to watch the competition.[Case] The 24th Session of Employee Soccer League This year's choir competition featured 13 teams and over 2000 employees who sang with passion expressing their patriotism and celebrating

the national spirit through music. With their voices dedication and perseverance Luthai employees paid tribute to their motherland.In April 2024 the Company organized the 24th Employee Football League with over 150 participants including referees athletes and employee

representatives. A total of 11 teams competed in the tournament which lasted seven days and included 29 matches progressing through group

elimination rounds semifinals and the final.On the field players worked together fiercely contested the ball and displayed boundless energy. They ran with determination passed skillfully

and executed precise shots their agile movements weaving across the green turf. Their outstanding techniques and indomitable fighting spirit

were on full display. In the end the Administration Team won the championship the Weaving Production Department Team secured second

place and Liu Mingming from the Weaving Production Department was awarded the tournament’s top scorer.Football Match Scene

Choir Performance Scene

[Case] Swimming Competition [Case] Youth Employee Social Event

On August 24 2024 Luthai Group hosted the "Swim Beyond Limits Strive for Excellence" 2024 Swimming Competition. The event featured To create a broader platform for socializing and communication while enhancing the sense of happiness and belonging among young

various categories including Men's 50 m Men's 100 m Men's 4 × 50 m Relay Women's 50 m Parent-Child 50 m "Non-Swimmer" Swimming employees the Company organized a youth employee social event at Banyang Villa on May 18. More than 80 young employees from various

and Parent-Child Interaction. Participants showcased their skills with different swimming styles competing fiercely in the pool demonstrating departments participated in the event.the indomitable spirit and determined pursuit of excellence that define Luthai employees.The event featured a series of fun and engaging interactive games including "Sweet Surprise" "Hearts Aligned" "Crossfire Challenge" "True

or False" and "Unconventional Thinking." Led by the hosts participants worked closely together supported one another and confidently

showcased themselves. Amid laughter and joy they formed closer bonds deepened mutual understanding and shared an enjoyable and

unforgettable experience filled with happiness and cherished friendships.

90 91Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

The survey analysis determined that the overall satisfaction rate of the Group was 88.4% reflecting a 0.2% increase compared to the previous

year. Feedback on employee satisfaction levels was provided to each department and 69 departmental employee satisfaction improvement

reports were compiled and distributed to address and rectify identified satisfaction issues.Youth Employee Social Event Scene

Overall Satisfaction

[Case] Series of Cultural and Sports Activities to Celebrate the New Year

Linear trend

(overall satisfaction)

On December 27 2024 Luthai Group launched the 2025 New Year Sports and Cultural Activities with the theme of "Fitness for the New Year

Striving for the Future". The event lasted three days and attracted over 300 participants. Competitions included table tennis badminton

billiards card games such as Guandan Shengji and Gouji as well as Chinese chess. Through these activities employees strengthened their

bodies relaxed their minds and brought new energy to the Company's development.Indoor Activity Scene Overseas employees' learning in China

Employee satisfaction survey The Company organized overseas employees to visit domestic factories for learning and training. To accommodate their living habits bidet

sprayers were installed in restrooms and the cafeteria provided specially prepared light dishes suited to their tastes. To ensure overseas

employees felt the warmth and hospitality of Luthai and China leisure activities were arranged during their rest periods including sightseeing

To enhance employee satisfaction and strengthen corporate cohesion the Company conducted an employee satisfaction survey in 2024. The trips and invitations to participate in anniversary celebrations and performances.survey focused on six key dimensions: overall recognition work environment direct supervisors team collaboration learning and development

and compensation and benefits. A total of 8900 valid responses were collected accounting for 86% of all surveyed employees.Survey Analysis

Valid questionnaires

A total of 9255 questionnaires were collected in this

satisfaction survey After excluding invalid questionnaires

8900 valid responses were finalized representing 96% of the

total collected questionnaires.Accommodation and dining

Invalid questionnaires

92 93Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Holiday excursions Mid-Autumn family banquet Subsidies and prize distribution

Gathering & dining Anniversary celebration activities

94 95Community Engagement/

Striving to Be an Outstanding

Corporate Citizen

In the face of a complex and severe external environment Lu Thai assesses the situation makes

unified decisions and overcomes difficulties. The Company assists the national education

and community public welfare undertakings and provides strong impetus for local economic

development.UN Sustainable Development GoalsChairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Supporting education initiatives crucial step forward in their school-enterprise collaboration and the beginning of a new chapter.Education is a long-term endeavor that benefits future generations. Over the years Lu Thai has actively contributed to education support According to the agreement Lu Thai and Shandong Vocational Institute of Fashion Technology

programs investing a total of over RMB45 million in educational assistance. The Company has established cooperative education programs will co-establish the "Lu Thai Textile & Apparel Industry Academy" to further develop textile

with more than 20 vocational and higher education institutions demonstrating its strong commitment to social responsibility through concrete and apparel programs innovate talent cultivation models and promote the integration of

actions. Looking ahead Lu Thai will continue to stay connected to its hometown support the development of education strengthen school- education and industry. This initiative will lay a solid foundation for international development

enterprise cooperation and drive new achievements in educational collaboration. while providing strong support for the transformation upgrading and globalization of the

textile and apparel industry.【Case】Inauguration of the "Peking University Ideological and Political Practice Course Education Base"

Welfare and charity actions

The Company has always adhered to its original mission actively participated in public welfare and charity activities and continuously

donated to public welfare and charity projects to share the achievements of enterprise development with society through practical actions.【Case】RMB100000 Donation to Hongshan Primary School Accumulating a Total of RMB2.2 Million

Unveiling Ceremony Scene

On January 9 2024 the unveiling ceremony for the "Peking University Ideological and Political Practice Course Education Base" jointly On July 6 2024 Lu Thai Group held a donation ceremony

established by the School of International Studies at Peking University and Lu Thai Textile Co. Ltd. was held at the Company. at Hongshan Primary School contributing RMB100000

bringing its cumulative donations to the school to RMB2.2

During the ceremony Chairman Liu Zibin stated that the collaboration between Lu Thai and Peking University's School of International

million. At the ceremony Chairman Liu Zibin expressed the

Studies would foster mutual promotion and integration between ideological and political practice courses and corporate culture

Company's hope that this donation would help improve

generating new insights and opportunities. Lu Thai will take this initiative as an opportunity to further strengthen its partnership with

the school's teaching conditions enhance education

Peking University jointly explore new models and pathways for school-enterprise cooperation and strive to provide high-quality

quality and create a better learning environment for

educational resources and practical opportunities for outstanding students achieving a win-win situation for the university the

students.enterprise and the students.Donation Ceremony Scene

【Case】Donation to the "Lu Thai Textile" Education Fund and 2024 "Lu Thai Textile" Scholarship Awards at 【Case】Lu Thai Cultural Park’s Free Public Zoo

Shandong University of Technology

In the popular internet-famous city of Zibo there is a well-known attraction—Lu Thai Cultural Park located less than two kilometers from the

former residence of Pu Songling the world-renowned master of short stories. Within the park lies a zoo a public welfare facility operated by a

private enterprise and open to the public free of charge all year round. Visitors can enjoy the zoo daily much like visiting a familiar home.This private enterprise is Lu Thai Group which invests over RMB3 million annually in maintaining the zoo. Today Lu Thai Cultural Park has

become a popular fitness and leisure destination for local residents receiving widespread positive feedback from the community.【Case】Chairman Liu Zibin' s Visit to Centenarians on the Eve of the Double Ninth Festival

Ceremony Scene The Double Ninth Festival is set to show respect to the elderly.On the occasion of this festival Chairman Liu Zibin also the Party

On June 20 2024 the donation ceremony for the "Lu Thai Textile" Education Fund and the distribution of the 2024 "Lu Thai Textile" Secretary and President of the Company visited centenarians

Scholarship were held at Shandong University of Technology. Chairman Liu Zibin represented the Company in donating the education across the district extending his holiday greetings and best

fund and personally awarded scholarships to the honored students. wishes.Since 2006 Chairman Liu Zibin and his family have been donating

to centenarians in the district for 19 consecutive years. Starting

【Case】Strategic Cooperation Agreement Signing and Unveiling Ceremony of the "Lu Thai Textile & Apparel

Industry Academy" with Shandong Vocational College of Clothing Technology in 2022 the donation amount was increased from RMB1 million

to RMB 2million annually bringing the total donation to RMB22

On December 10 Lu Thai Group and Shandong Vocational Institute of Fashion Technology held a strategic cooperation agreement million. This philanthropic effort has received widespread

signing ceremony and the unveiling ceremony for the jointly established "Lu Thai Textile & Apparel Industry Academy." During the recognition and praise from various sectors of society.ceremony Chairman Liu Zibin delivered a speech emphasizing that this signing marks a milestone event for both parties signifying a

crucial step forward in their school-enterprise collaboration and the beginning of a new chapter. Chairman Liu Zibin Visiting and Honoring Elderly Residents

98 99Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Greenhouse gas emissions

Key Performance Indicators

Indicator (Unit) 2022 2023 2024

Mobile sources emissions (tons of carbon dioxide 808 778 771

Economic performance equivalent)

Stationary source emissions (tons of carbon dioxide

equivalent) 12771 10520 10859

Indicator (Unit) 2022 2023 2024 Category 1 emissions (tons of carbon dioxide 13579 11298 11630

equivalent)

Operating revenue (RMB’00000000) 69.3868.01 59.4671.51 60.9512.38 Consumption of purchased power (tons of carbon 375819 331445 163301dioxide equivalent)

Payments to contractors and service Consumption of purchased heat (tons of carbon 145314 121992 127643

providers(RMB’00000000) 3.18 4.72 2.61

dioxide equivalent)

Category 2 emissions (tons of carbon dioxide 521133 453437 290944

Total employee remuneration (including compensation equivalent)

16.4916.9015.1449.2716.0174.41

and benefits) (RMB’00000000) Total (tons of carbon dioxide equivalent) 534712 464735 302574

Payments to capital providers (RMB’00000000) 1.66 1.85 3.32

Energy consumption density

Payments to the government (RMB’00000000) 5.07 6.5 3.723.69 3.553.27

Indicator (Unit) 2022 2023 2024

Retained economic value (RMB’00000000) 9.12 3.10 1.97

Greenhouse Gas Emission Intensity (tCO2e/Million

Revenue) 79.7 51.1 49.9

Total energy emission density (tons of standard coal per

Environmental performance million revenue) 13.5 13.1 12.9

Data related to wastewater and sewage Human resources

Indicator (Unit) 2022 2023 2024 Protection of employee rights and interests

COD (Chemical Oxygen Demand) in discharged wastewater 395 283 248

(ton) Indicator (Unit) 2022 2023 2024

Ammonia nitrogen content in discharged wastewater (ton) 7 3 3 Employment contract signing rate (%) 100 100 100

Social insurance coverage (%) 100 100 100

Industrial wastewater discharge (10000 cubic meters) 387 311 291

Signing rate of collective bargaining agreement (%) 100 100 100

Number of female employees with parental leave during

the year (person) 317 672 796Air pollutant emissions

Number of male employees with parental leave during

the year (person) 103 287 182

Indicator (Unit) 2022 2023 2024

Employee diversity

Sulfur dioxide in emitted exhaust gas (ton) 3 1 0.2

Nitrogen oxides in emitted exhaust gas (ton) 6 3 0.5 Indicator (Unit) 2022 2023 2024

Employee diversity

Waste discharge Total number of incumbent employees (person) 23028 22850 23988

Total number of male employees (person) 9736 9317 10432

Indicator (Unit) 2022 2023 2024

Proportion of male employees (%) 42 41 43

Hazardous waste generation (ton) 79 41 36

Total number of female employees (person) 13292 13533 13556

Non-hazardous waste generation (sludge) (ton) 14320 12462 11420

Proportion of female Employees (%) 58 59 57

100 101Chairman's Statement About the Company ESG Governance Products and Services Production Operations Energy Conservation and Environmental Protection Employee's Rights and Benefits Community Engagement Key Performance Indicators ESG Report 2024 Lu Thai Textile Co. Ltd

Indicator (Unit) 2022 2023 2024 Reader Feedback

Employee age

Total number of employees aged under 30 (person) 9866 9671 9814 Dear readers:

Proportion of employees aged under 30 (%) 43 42 41

Greetings! Thank you for reading this Report. In order to keep improving report preparation we want to hear your

Total number of employees aged above 30 (person) 13162 13179 14174 opinions and suggestions. Please help us by telling us your answers to the questions in the feedback sheet via one of the

Proportion of employees aged above 31 (%) 57 58 59 methods listed below:

Mail address: 81 Songling East Road Zichuan District Zibo City Shandong Province

Education background of employees Tel: 0533-5188888

Bachelor or above (person) 1400 1319 1555 Your information

Junior college (person) 4523 3726 4517 Name: Institution that you work for:

Position: Tel:

High school or below (person) 17105 17805 17916

Fax: Email:

Nationality

China (%) 54 51 46

Choice questions (Please mark √ in the proper box)

Foreign employees (%) 46 49 54

Neither

Very Reasonably Not really Very

Questio good nor

good good good bad

Employee turnover bad

This report comprehensively and accurately reflects the

Indicator (Unit) 2022 2023 2024 significant impact of Lu Thai Textile on the economy

society and environment

Total number of new employees (person) 7313 3338 6648

The report's response to and disclosure of stakeholder

Employee turnover rate 21% 13% 20% concerns

The information indicators and data disclosed in this

report are clear accurate and complete

Employee training The readability of this report namely the logical thread

content design language and layout design of the report

Indicator (Unit) 2022 2023 2024 language and layout design of the report

Training participants (person) 23028 22850 23988

Open-ended questions

Average training hour (hour) 56 56 56 1. What aspect of this report do you find most satisfying

Training coverage rate (%) 100% 100% 100% Scan the QR code to provide

feedback to us.

2.What else do you think you need to know that is not reflected in this report

3.What advice do you have for our future preparation of ESG reports

102103