2025

Environmental Social and Corporate Governance Report

SG Micro CorpCONTENTS

Message from 01 About Company Overview 02

the Chairman SGMICRO Social Responsibility 03

Performance Highlights

Awards and Qualifications 03

Corporate Strategy 04

Sustainable Development 05

Management

Scientific Corporate 09 Innovation Research Development 16

Management Governance and R&D and Innovation

Risk Management 11 A Closer Look: Green R&D 18

Business Ethics 13 and Innovation

Information Security 14 Strict Quality Control 20

Customer Service 21

Responsible Build a Sustainable 23 Green Environmental 27

Procurement Supply Chain Comes First Management Systems

Conflict Minerals 25 Resource Management 28

Management and Utilization

Tackling Climate Change 29

People- Recruitment 32 Appendix About This Report 42

Oriented Employee Benefits 33 Key Performance 43

Together Talent Development 36 Indicators

Key Targets

We Thrive Health and Safety 39 45

Social Responsibility 40 Glossary 47

Feedback Form 47

Environmental Social and Governance (ESG) ReportSGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Message from the Chairman

The year 2025 was the one of challenges and by our pursuit of excellence we continuously increase efficiency and embed green development principles We are committed to improving operational efficiency

opportunities. Amidst a complex and dynamic market R&D investment push the boundaries of technological across all facets of our operations. through lean management practices. By refining

SGMICRO actively navigated these complexities while innovation and develop more efficient and comprehensive aspects of our governance including our

strategically capitalizing on emerging opportunities. We energy-saving analog ICs. The company's production Believing that corporate growth and social progress are corporate structure sustainable framework and ethical

remain steadfast in our founding aspiration: to become a lines cover 38 categories and more than 6800 fundamentally interconnected SGMICRO maintains a conduct we enhance the effectiveness of risk and

leading integrated analog IC enterprise dedicated to products which are already widely utilized in a broad customer-centered approach to delivering compliance management. Reflecting on 2025 SGMICRO

enhancing lives through technological innovation. range of markets such as new energy vehicles high-quality reliable products. This is supported by a achieved steady optimisation across various fronts

Technology is a pivotal force driving societal progress photovoltaic energy storage intelligent manufacturing comprehensive quality management system and including financial strength team efficiency and resilience

and each advancement broadens human prospects and and green household appliances creating value for our responsive customer feedback mechanisms. Externally against risks delivering robust overall performance.enriches possibilities. We firmly believe that our customers while serving our common goal of energy we have raised environmental standards for our

continuous pursuit of technological innovation and conservation and protecting our environment. suppliers reinforcing a joint commitment to building a Looking ahead SGMICRO will adopt an even more

breakthroughs will guide our era toward a future that sustainable and responsible supply chain. Internally responsible stance collaborating with stakeholders to

significantly benefits global well-being and the We recognize climate change as the defining global fostering a diverse equitable and inclusive workforce advance economic social and environmental sustainability.sustainable development of our planet. challenge of our generation. In response SGMICRO has remains a priority. We consider a supportive workplace In the face of unforeseen challenges and environmental

proactively integrated carbon reduction into our core culture that values employee well-being and shifts SGMICRO's team will continue to contribute with a

Since our inception we've focused on developing sustainability strategy. We are steadfastly driving development crucial for strengthening cohesion and strong sense of mission working collaboratively to bring

high-performance high-quality Integrated Circuit (IC) forward our medium- to long-term goals: a 50% enhancing a sense of belonging across the company. about positive change in the world.products. This commitment stems from a sincere desire to reduction in carbon emissions per million yuan of Furthermore SGMICRO actively participates in various

protect our environment through innovation-driven output by 2030 and a 90% reduction by 2050. These social welfare events to raise public awareness of

reduction of energy consumption and the wish to Zhang Shilongtargets are underpinned by continuous initiatives to sustainable development and social responsibility.improve the quality of life for future generations. Driven optimize our energy mix enhance operational Chairman and CEO

Environmental Social and Governance (ESG) Report < 01 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

About SGMICRO

SGMICRO specializes in the research development and sales of high-performance

high-quality analog integrated circuits with the goal of becoming a leading Overview

comprehensive analog IC company. From the very beginning the company established

a core operating principle centered on customer needs focusing on developing and

producing highly reliable and consistent analog IC products through a process of

continuous innovation. SGMICRO is fundamentally driven by an engineer-led culture.SGMICRO began by specializing in high-performance operational amplifiers and LDOs

primarily serving industrial applications. The company then strategically broadened its

product portfolio to offer comprehensive signal-chain solutions in analog and Headquartered Listed on the SZSE ChiNext

mixed-signal conditioning alongside a complete suite of power management solutions.As a fabless analog IC company SGMICRO has maintained a long-standing partnership in Beijing China (stock code 300661) on June 6 2017

with TSMC since its inception. This collaboration enabled the successful development

of a range of high-precision low-noise high-speed operational amplifiers (OpAmps).By leveraging CMOS process technology to replace traditional bipolar processes

SGMICRO gained significant market recognition for its technical expertise and achieved As of the end of 2025 1835 employees

a distinct cost advantage. including 1335 in R&D

Driven by a respect for intellectual property SGMICRO focuses on independent product

development. Years of sustained research and development have built deep in-house

technical expertise and an impressive portfolio of proprietary products. We back our

innovation with a systematic quality assurance mechanism ensuring every integrated

circuit (IC) meets rigorous quality benchmarks. Furthermore all our products strictly

complies with RoHS and other global environmental standards. 38.98

SGMICRO prioritizes attention to detail and continuous improvement striving to offer

our customers the utmost support and seamless service. While steadily expanding its 2025 Revenue (RMB Billion)

industrial client base the company has also demonstrated a strong adaptability to the

dynamic global market for communication and information-related consumer

electronics. This has honed its stable supply chain management and cost

competitiveness. As a result we have earned an excellent reputation for delivering

high-quality products with short lead times and large-scale shipments thereby

securing the respect and trust of our customers. 6000+

Since its inception the company has maintained a stable founding team and low

employee turnover enabling consistent and rapid business growth. We have been Customers

continuously profitable annually since 2009. The company was successfully listed on

the Shenzhen Stock Exchange on June 6 2017 trading under the stock code 300661.SGMICRO aims to be a leading global supplier of analog IC solutions. The company

partners directly with industry-leading manufacturers across diverse sectors including

factory automation solar inverters new energy vehicles Li-battery formation white 6800+

appliances 5G wireless base stations optical fiber modules servers office equipment

machine vision smartphones audio systems VR game consoles and smart watches. Products

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2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Social Responsibility Performance Highlights Awards and Qualifications

Top 10 China IC Brands Outstanding Chinese Automotive

Environmental Performance China Analog IC Automotive Chip Suppliers

Industry Excellence Award National Intellectual Property

26562.80 11615082.65 Annual Dual?Carbon Demonstration EnterpriseEnergy?Saving Leadership Award Awarded the CNAS Accredited

Water consumption (m3) Power consumption (kWh)

World Electronics Achievement Laboratory Certificate

Awards "Product of the Year"

6287.52

Total greenhouse gas emissions (Scope I + II) Unit tCO2e

Social Performance

183510078.73

Number of employees Employee training Average learning hours

coverage rate (%)

R&D Performance

10.45588141

Investment on R&D Patents obtained Newly applied patents

(RMB Billion)

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2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Corporate Strategy

SGMICRO is committed to achieving its business objectives by creating societal value through innovation-driven market-oriented strategies. We prioritize strategic planning

emphasizing robust research and development to address critical technical challenges and continually enhance our existing product portfolio. We are actively advancing

next-generation high-performance analog IC technologies steadily reinforcing our position within the industry. With a long-term vision of becoming a leading integrated analog IC

provider SGMICRO aims to contribute to societal progress and improve the quality of life through continuous innovation and technological advancement.Our Culture and Values

SGMICRO champions a people-oriented philosophy fostering a culture defined by diligence innovation teamwork and accountability. We are dedicated to cultivating an environment

that is positive straightforward trustworthy confident inclusive open-minded and supportive. We encourage independent thinking and continuous experimentation through open

direct and authentic communication. Our aim is for every employee to deeply understand the value of their work align with team goals and integrate personal growth with team

advancement and the company's sustainable development. We empower our employees to boldly pursue breakthroughs embrace challenges and enhance their professional skills

ensuring their career development progresses alongside the company's steady growth enabling them to share in its collective success.Our company embraces a philosophy of continuous improvement and a flat organizational structure promoting equality and unhindered communication among colleagues.We encourage every supervisor to actively participate in resolving critical team issues serving as a motivator facilitator and trainer. Similarly we empower each team member to

proactively collaborate with colleagues on task implementation continuously accumulating experience deepening understanding optimizing processes and enhancing efficiency.This fosters individuals who are experts challengers and innovators in their roles. We pay particular attention to fostering internal team vitality and efficiency emphasizing a

competitive dynamically optimized resource allocation mechanism built upon synergistic overall goals. Our results-oriented performance evaluation system consistently incentivizes

employees to grow and develop alongside the company for the long term.The company mandates that all employees conduct themselves in accordance with legal regulations and social ethical standards ensuring that all activities and decisions align with the

long-term interests of customers the company and employees. We prohibit the provision of false or misleading information and strictly adhere to anti-corruption commitments and

anti-commercial bribery regulations in all business operations. SGMICRO practices corporate citizenship across all its operational locations. Our corporate governance mechanisms are

designed to ensure that business policies meet the long-term interests and demands of relevant stakeholders including government society customers employees and shareholders.We are actively committed to fulfilling our social and environmental responsibilities thereby ensuring the company's sustained long-term development.People- Diligent and Team Work Responsible

oriented Innovative

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2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Sustainable Development Management

Stakeholder Communication

SGMICRO integrates sustainability principles throughout its technology development and product innovation processes and has

established a robust ESG management framework. ESG governance is advanced from the top down supported by ongoing engagement

and communication with stakeholders. By actively responding to external expectations and continuously enhancing its sustainability

management practices SGMICRO drives long?term value creation.We place strong emphasis on the feedback and assessments of our operations and ESG performance from all stakeholders. SGMICRO is

dedicated to building a highly-efficient transparent communication mechanism and carries out the identification evaluation and

ESG Management System analysis of substantive issues through various channels such as shareholders' meetings customer satisfaction surveys employee and

management symposiums websites and WeChat accounts. We proactively respond to expectations and concerns regarding the

Company’s ESG performance working together with stakeholders to create sustainable value.We embed sustainability into our top?level planning and have established an ESG management system led by the Board Office with

close collaboration across business functions and the ESG Work Group. This structure enables systematic and coordinated ESG

governance across the organization.Stakeholders Recognition Expectation and Demands Communication and Responses

Financial performance/

R&D and innovation/ Board meetings/Disclosure of information/

Investors Investor relations management/ Investor communication

ESG management structure Board structure and governance

Risk and internal control management/

Product responsibility management/ Official correspondence/

Government/regulators Community charity/ Supervision & inspection/

Environmental management/ Disclosure of information

Occupational health and safety

Board Office

Product responsibility management/

Leads the ESG management system in coordination with

Customers R&D and innovation/Industrial exchange Customer service/Technical seminar/various departments. and cooperation/Information security Satisfaction survey

and privacy protection/Business ethics

Occupational health and safety/

Various Departments A democratic communication platform/

ESG Employee

Protection of employee rights and interests/ Employee assembly/Employee activities

Departments such as Human Resources Operations Quality Employee training and development

Internal Control and Information Technology are responsible

for implementing specific ESG initiatives. Suppliers/ Supply chain management/ Suppliers screening and review/

Service Providers Mutual benefit and progress Suppliers exchange and training

Cooperative

ESG Work Group Organizations (i.e. R&D and innovation/ Industry forum/

NGOs Scientific Industry win-win relationships Industry-university research cooperation

Coordinates ESG management communication and research institutions)

information disclosure reporting progress and outcomes to

the Board. Community and Community building collaborations/ Disclosure of information/Community activities/

the Public Rural revitalization Exchange and interview

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2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Management of Substantive Issues

Based on the latest requirements issued by the Shenzhen Stock Exchange while taking into account the expectations of internal and

external stakeholders as well as factors relating to business scope and sustainable development we carry out identification evaluation

and analysis of substantive topics on an ad-hoc basis.The Process of Identifying Substantive Topics

Identifying Substantive Topics Key Stakeholder Engagement

The Company reviews consolidates and updates Assessments are conducted on an ad?hoc basis with key

substantive topics by considering changes in internal and stakeholders to gather insights on topic priority.external environments as well as relevant laws

regulations and industry standards.Materiality Analysis Review of Substantive Topics

Based on valid data collected through the assessment The results of the materiality analysis are submitted

process the Company evaluates the significance and to management for review and confirmation.prioritization of substantive topics.Substantive Topics of ESG

Environmental Topics Social Topics Topics of Corporate Governance

Green R&D Product quality Talent development Corporate Business ethics

Tackling climate change control Health and safety governance Compliance control

Energy conservation and Product R&D and Salary and Board composition

carbon footprint reduction innovation compensation Internal control and

Water resource utilization Intellectual

Board of supervisors risk management

Industry-university

and management property rights

performance

research Information security

Green operation Quality of cooperation Disclosure of and protection

customer service Social responsibility information

Sustainable supply Investor relations

chain management

Employee benefits

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2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Response to the UN's Sustainable Development Goals (UN SDGs)

UN SDGs Action Corresponding chapter UN SDGs Action Corresponding chapter

Good Health Implement annual general and occupational health check-ups Industry

and well-being innovation and for all employees with zero cases of occupational illness infrastructure

Health and Safety Enhance technological innovation Research Development Focus on occupational health and safety training

Build employee clubs organize cultural and sports events for Carry out intelligent transformation

and Innovation

the employees

Quality Reduce

education inequalities

Focus on Employee training

Support education by providing scholarships and teaching Talent Development Prohibit all discrimination of any types Employee Benefits

awards to multiple universities

Gender Sustainable

equality cities and

Care for female staff communities Research Development

Implement a non-discrimination policy and strictly prohibit Employee Benefits R&D of semiconductor products to promote the use of clean energy and foster sustainable development and Innovationsexual harassment and misconduct

Clean water Responsible

and sanitation consumption Environmental Management

and production

Conservation of water resources Resource Management and Responsible emissions management Systems

Improve utilization of water resources Utilization Efficient management of resource Resource Management and

Utilization

Affordable and Peace justice Oppose commercial bribery and unfair competition by

clean energy and strong

institutions formulating the Integrity and Anti-Corruption Management Facilitate the photovoltaic industry and promote the Business EthicsTackling Climate Change Standards and require business partners to sign the Integrity

utilization of solar energy Employee BenefitsCommitment Letter establishing multiple channels to gather

employee feedback

Decent work Partnerships Build channels for stakeholder communication Sustainable Development

and economic for the goals Management

growth Focus on supply chain construction and carry out technical

Legal hiring and employment promotion Employee Benefits exchanges and training with suppliers

Build a Sustainable Supply Chain

Open up ecological cooperation and promote the Conflict Minerals Management

development of a healthy ecosystem in the industry Research Development and Innovation

Environmental Social and Governance (ESG) Report < 07 >Science-Based

Governance

SGMICRO is diligently refining its corporate

governance structure and developing a

science-based governance system. We

implement a streamlined efficient and

smoothly functioning framework that

adheres to principles of integrity and

compliant management. This approach

aims to effectively protect investor interests

and consistently enhance company value.Corporate Governance 09

Risk Management 11

Business Ethics 13

Information Security 14SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Corporate Governance

Governance Structure Board of Directors

The company strictly complies with all applicable national laws and regulations and continuously refines and strengthens our corporate governance structure to The company's Board of Directors consists of six members including two

establish a solid foundation for long?term steady development. Clear responsibilities are assigned to the Board executive officers supervisors and the independent Directors and one Employee Director. All directors possess

management team creating a robust mechanism for independent oversight and strong modern corporate governance. This ensures that decisions made adhere extensive experience in corporate management and risk management

to legal regulations while effectively safeguarding the collective interests of our shareholders. control. To improve the rigor and quality of major decisions directors are

As the time of the report in accordance with the newly revised company Law of the People's Republic of China and relevant securities regulatory requirements assigned to various committees based on their professional backgrounds

the company has completed the dissolution of its Supervisory Board and accordingly amended its Articles of Association and related governance policies and industry expertise laying a solid foundation for the company's

clarifying the roles and responsibilities of its corporate governance bodies. long-term growth.At the time of the report the attendance rate of the

Governance Structure Board members was 100% with all directors performing 100%

their duties faithfully honestly and diligently.Shareholders' The general meeting of shareholders which all shareholders are entitled to attend is the ultimate

Meeting governing body of the company.Board of Directors

Audit Committee SGMICRO places strong emphasis on diversifying our Board of Directors to

Review the company's financial information and disclosure supervising and evaluating internal and enhance corporate governance effectiveness and improve decision-making

external audit work and internal controls. quality through a more comprehensive perspective.Compensation Committee

Establishes performance evaluation criteria and carries out evaluations for directors and senior Professional Industry: 2 Management: 2

Board of management; devising and reviewing compensation policies and schemes.Backgrounds Legal: 1 Finance: 1

Directors Strategy Committee Number of board members 6

Responsible for formulating the company's development strategies and

medium to long-term development plans.Nomination Committee Male: 2

Responsible for selecting and reviewing candidates for directors and Gender Age 30-50 yrs old: 2Female: 4

senior management positions and assessing their qualifications. 50+ yrs old: 4

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2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Disclosure of Information

The Board of Directors is responsible for overseeing and managing the disclosure of information. The Board Secretary

coordinates and organizes specific activities related to this disclosure with support from the Securities Affairs Representative.The company strictly implements our information disclosure policies and prudently enforces insider information confidentiality

and control mechanisms to ensure that all disclosures are truthful accurate and complete thereby safeguarding the legitimate

rights and interests of investors.We disseminate information through various channels including CNINFO and media outlets designated by regulatory

authorities such as China Securities Journal Shanghai Securities News Securities Times and Securities Daily. This ensures all

shareholders have equal access to information.Performance

In 2025 in the Announcement on the Results of the 2024-2025 Annual Information

Disclosure Assessment for Companies Listed on the ChiNext Market released by

Shenzhen Stock Exchange SGMICRO was granted "A" grade in recognition of our

outstanding disclosure practices. A

This is the fourth consecutive year we have been awarded the "A" grade by Company information

Shenzhen Stock Exchange. disclosure results

Investor Relations

The company places strong emphasis on investor relations management and has designated the Board Secretary as the

person responsible for investor relations ensuring comprehensive coordination of communication and engagement with

investors. We have established a comprehensive investor communication mechanism that includes the release of periodic

reports organization of research and engagement activities and dedicated investor hotlines and email channels. Leveraging

digital interaction platforms we respond promptly to investor concerns continuously enhance information transparency and

strengthen investor understanding and confidence in SGMICRO.Environmental Social and Governance (ESG) Report < 10 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Risk Management

Internal Control Management Risk Management

SGMICRO has a rigorous internal control management mechanism and a

well-defined internal control management policy. The risk management system is

comprehensively implemented by robust measures that help ensure its effective SGMICRO places a high priority on risk management. The company has In 2025 the company strictly adhered to the core 'risk-based thinking'

operation. established a collaborative 'Three Lines of Defense' framework—spanning our requirements of our quality management system. We established a

Business Units Risk Management Function and Audit Committee—to oversee closed-loop full-process management framework based on an

We continuously refine the internal control system to comply with relevant laws corporate risk. Anchored by our R isk and Opportunity Control Procedure 'Identify-Assess-Respond-Monitor-Review' cycle. This risk and

and regulations such as the Company Law of the People's Republic of China

Basic Standard for Enterprise Internal Control and other internal control this institutionalized mechanism evaluates potential policy operational and opportunity management mechanism spans all operational and

supervision requirements. financial risks by aligning internal controls and strategic planning with administrative processes. Utilizing the PESTEL analysis model as our core

industry-specific characteristics. Through rigorous risk assessments that tool we systematically identify how changes in the internal and external

The company has established a well?structured internal control management evaluate the type significance and probability of each threat we environments impact our quality objectives business performance and

framework with clearly defined roles and responsibilities. Through the Board of implement targeted mitigation strategies to ensure all identified risks are sustainable development.Directors the Audit Committee and the Internal Audit Department SGMICRO

implements internal control measures at multiple levels to ensure compliant managed and addressed promptly.operations and effective risk management thereby supporting its sustainable and

healthy development.Three Lines of Defense in Risk Management Risk Management Workflow

Internal Control and Risk Management Structure

First Line of Defense: Business Department

Responsible for establishing improving and ensuring the Embed risk control into business processes

Board of effective implementation of internal controls; approving risk ("institutionalization → process?driven → digitalization"); Risk

Directors management strategies policies and objectives; and Implement departmental risk response measures and

reviewing the annual risk assessment report and major risk Assessmentconduct regular self?inspections and reporting.response plans.Oversees the effectiveness of the risk management system Second Line of Defense: Risk management department

PESTEL Dimensions: Severity of impact Risk Acceptance

Audit Committee coordinates internal and external audit activities and reviews Develop risk control policies and tools;

Political / Economic / Likelihood of Risk Reduction

Under the Board internal control evaluation reports to ensure compliance and Monitor the execution of the first line of defense and

Social / Environmental / occurrence

evaluate the effectiveness of control measures; Technological / Legal Risk Avoidancethe accuracy of financial reporting. Detectability

Executes specific responsibilities implements Board Coordinate risk assessments and follow?up on rectification.Management resolutions and coordinates risk response measures. Third Line of Defense: Audit Committee Risk Risk

Internal Audit Conducts risk identification assessment and follow?up on

Independently audit the effectiveness of internal controls Identification Response

Department rectification. Oversees the performance of the three lines of

(including fraud information security compliance etc.);

defense and reports regularly to the Audit Committee. Formulate audit plans based on a risk?oriented approach;

Promote closed?loop audit rectification and report to the

The company conducts an annual self?assessment of the effectiveness of our

internal controls and issues an annual internal control evaluation report. A Board of Directors and management.third?party accounting firm is hired to audit the report. At the time of the report

the company maintains effective internal controls in all material aspects in

accordance with the Basic Standards for Enterprise Internal Control and relevant

regulatory requirements.Environmental Social and Governance (ESG) Report < 11 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Types of Risk Identification

External Factors

Regulatory requirements (changes in laws and

regulations/industry standards)

Requirements of relevant parties (supervision level of regulatory

authorities/requirements of relevant parties)

Technology (new products/new technologies)

Politic (supply chain/exchange rates/trade compliance)

Resources (intensified market competition/macroeconomic

environment and industry fluctuations/IT software)

Internal Factors

Financial status (asset-liability ratio/inventory turnover

ratio/accounts receivable)

Company management (management process/after-sales

service/document control/data information security

management/authority)

Resources (company operating environment/infrastructure

management/performance appraisal/personnel turnover)

Looking ahead we will continue to refine our quantitative risk?assessment

models to improve sensitivity in identifying high?impact low?probability risks.We will also strengthen mechanisms for cross?departmental risk?information

sharing and enhance coordination across functions to respond more effectively

to emerging risks. Requirements for risk?and?opportunity management will be

further embedded into operational procedures across all business units

helping deepen company?wide risk awareness and providing solid support for

achieving SGMICRO's annual operational objectives.Environmental Social and Governance (ESG) Report < 12 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Business Ethics

SGMICRO is guided by the principles of authenticity compliance resilience and sustainability with authentic data and legally compliant operations. We crack

down on commercial bribery and oppose unfair competition. We comply with all relevant laws and regulations to maintain a fair equitable and competitively

open commercial environment. Our products and services of superior quality combined with an excellent reputation enable SGMICRO to continue securing new

business opportunities. Whistleblowing and Protection

Integrity and Honesty Mechanism

In accordance with strict integrity guidelines we have developed policies such as the Integrity and Anti-Corruption Management Standards and are committed SGMICRO consistently clarifies requirements for standardized operations

to strict compliance with applicable anti-bribery and anti-corruption laws and regulations. We prohibit any form of bribery corruption embezzlement extortion anti-corruption and fair trade creating an internal environment of strong

misappropriation of funds or any related conduct to ensure the smooth operation of the company. All employees are required to refrain from promising business ethics. We rigorously implement integrity and compliance

offering giving granting or accepting any improper and illicit benefits. management into all business activities. Employees and partners who

discover any illegal or non-compliant behavior with the company's business

Multi?Dimensional Integrity and Anti?Corruption Initiatives ethical standards can promptly lodge complaints through dedicated

channels. SGMICRO protects whistleblowers ensures their identities remain

confidential and maintains channels and policies of open communication.Establishment of Supervisory Management Institutions Annual Integrity and Honesty Management Audit Employees and partners can express their compliance concerns through

The Audit Committee established under the Board of Directors Relevant departments of the company organize annual integrity and dedicated channels whether anonymously or identified. Complaints are

adheres to relevant laws and regulations while overseeing business honesty management audits encompassing all employees and investigated and any retaliatory actions or threats against whistleblowers

ethics and corruption issues. It promotes a system of integrity business partners who have direct business dealings with SGMICRO. are strictly prohibited. The company will take appropriate disciplinary action

enhances SGMICRO's capacity for legal governance and standardizes The Annual Integrity and Honesty Management Audit Report is against any violation including but not limited to termination of

the management of business ethics in the company. released following a comprehensive evaluation and analysis process. employment contracts and pursuing legal liability.We require all marketing and procurement personnel to sign the

Integrity Commitment Letter strictly adhering to prohibited conduct Email: informer@sg-micro.com

Promotion of Integrity and Honesty Management regulations on integrity including: prohibition on soliciting or

accepting cash securities payment instruments or other valuable

Every year SGMICRO organizes activities to promote integrity and items in any form from business partners or having them pay for any

honesty management concepts to business partners who have direct Dedicated phone line: 010-88825983goods or services; prohibition on directly or indirectly offering

business dealings with the company ensuring that they comply with promising or providing any payment or item of value to government

the integrity and honesty management standards and relevant Mailing address: F11 Building D officials/employees political candidates or employees/officials of

regulations. Business partners of the company all have signed the international organizations to obtain or retain business or any No. 87 North Third Ring Road

Commitment to Integrity and Honesty. improper advantage. Haidian District Beijing China

Integrity and Honesty Management Training

We conduct regular integrity and compliance management training for employees reinforcing their understanding of business conduct and principles.During orientation new employees gain a deep understanding of the company's Integrity and Honesty Management Standards which apply to all

employees of SGMICRO and its direct and indirect subsidiaries and branches.Environmental Social and Governance (ESG) Report < 13 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Information Security

Our goal is to build a safe and stable corporate network environment proactively apply advanced security protection technologies adapt disciplined management approaches

to build a rigorous and efficient Information Security Management System (ISMS). Simultaneously we actively promote the establishment and improvement of risk assessment 2025 Annual Performance

mechanisms accurately predict potential security risks and take efficient preventive measures to ensure the long-term security of our corporate information systems.Conducted cybersecurity awareness training for all

employees achieving 100% coverage. 100%

Management systems Organized cybersecurity emergency response drills

simulating scenarios such as "system outages" and

"cyberattacks" with a 100% completion rate for all response actions.The company strictly complies with relevant national laws and regulations of China Endpoint and Security Management

such as the Cyber security Law the Data Security Law and the Personal Information

Protection Law using the ISO/IEC 27001 Information Security Management System We implement access controls for external and mobile storage devices

as the policy benchmark. Based on industry characteristics and our operational needs restrictions on outbound email application control and comprehensive Case Information Security Training

we have established an Information Security Management Committee and dedicated software compliance management.working groups to develop systematic management policies and build a comprehensive We implement access control for critical areas alongside surveillance and

information security management System (ISMS). Through ongoing information?security IoT device monitoring to enable automated security incident alerts. In 2025 the company conducted multiple rounds of specialized

initiatives we continue to enhance our cybersecurity defense system. training on information security covering detailed interpretations of

Security Policy Updates relevant policies practical case studies and common issues. These

In 2025 we refined our internal policies particularly those related to data efforts continuously strengthened employees' awareness of

protection by aligning them with the latest laws and regulations and adapting them Driven by evolving business needs and technological progress we keep information security and enhanced their practical capabilities in data

to our operational context. These updates ensure full coverage of business?related enhancing our security protection policies and revising our cybersecurity protection thereby building a solid defense for the company's

data across the company. We defined clear security requirements for each stage of strategies and processes to ensure full alignment with current security information security. In addition the company launched an

data handling ensuring that policy execution remains aligned with business standards and applicable regulations. information security examination system to assess training outcomes

development needs and security requirements. achieving a pass rate of 98.5%.Emergency Response Drills and Vulnerability Scanning

By developing innovative security solutions we further strengthen our cybersecurity

safeguards and have established a multi?layered protection system that spans We regularly conduct cybersecurity emergency drills to validate the

hardware and software perimeter defenses and internal controls; thus providing effectiveness of incident response plans enhancing our IT team's ability to

strong support for stable and secure business operations. At the time of this report react and collaborate during incidents. Data Protection

the company has seen no information security incidents. Additionally we perform routine security vulnerability scans of our systems

to promptly identify and remediate potential system security risks.To address increasingly complex challenges in information and data security the

Information Security Protection Measures Network Isolation and Monitoring company has established a dual?driven protection mechanism integrating both

We maintain strict segregation between our office and R&D networks with institutional and technological safeguards. We rigorously comply with national

Awareness and Training VPN access and robust controls and auditing for all data transmissions. laws regulations and industry standards to ensure the secure storage and use of

We regularly send out reminders to help employees prevent phishing We conduct real-time monitoring of our network systems and enable

information protect corporate assets from unauthorized access or attacks and

emails enhancing their cybersecurity awareness and response capabilities. automated alerts to ensure that any faults or anomalies are promptly detected.minimize compliance and operational risks.We place strong emphasis on customer data security by always improving internal

We provide cybersecurity awareness training for all employees through

online lectures and video tutorials. Supervision and Audit management measures strengthening customer information protection

We conduct regular audits of data management practices across all mechanisms and standardizing the compliant access use and storage of

Additionally our IT team receives specialized security training and regular departments to ensure data compliance and security. customer data. Furthermore the company conducts periodic information security

updates helping employees at all levels build stronger cybersecurity We engage third-party auditors to verify the effectiveness of our IT system awareness training for all employees to ensure strict adherence to relevant legal awareness and improve their ability to respond to security risks. and resource security controls. and regulatory requirements.Environmental Social and Governance (ESG) Report < 14 >Innovation

and R&D

SGMICRO is dedicated to the research and

development of advanced analog chips.Through iterative innovation we deliver a

comprehensive portfolio of

high-performance high-quality analog

integrated circuits. Our commitment to

superior product engineering and efficient

customer service has established SGMICRO

as a trusted partner for leading global

enterprises.Research Development and Innovation 16

A Closer Look: Green R&D and Innovation 18

Strict Quality Control 20

Customer Service 21SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Research Development and Innovation

Research and development (R&D) and innovation form the cornerstone of our company's sustained growth. We view product R&D capabilities as our most critical

core competency and have established a comprehensive R&D management system and processes. Since our inception we have consistently pursued an independent

innovation-driven technical development strategy. With technical innovation at our core we continuously increase R&D investment accumulating numerous critical

core technologies. Concurrently based on market trends customer demands and predictions of future technological shifts we proactively conduct technological

research and product planning. This allows us to anticipate changes in end-user demand strategically position ourselves for growth opportunities and promptly

deliver competitive products to our target markets. While ensuring the application of existing product technologies we actively pursue next-generation innovations.Investment on R&D To manage the R&D projects efficiently we are continuously enhancing our R&D management system through the optimization and upgrade of our specialized

R&D management software. In advancing its innovation and R&D management

framework the company pursues independent innovation and steadily increases

The ongoing R&D investment continues to increase and has resulted in the rapid R&D investment to build a strong foundation of core technologies. By

expansion of our technical team and significantly bolstered our technological strengthening efficient communication channels with customers SGMICRO gains

capabilities. We take pride in independently developing a wide range of core a deeper understanding of their evolving needs and adjusts our market

technologies. Leveraging these cutting-edge technologies SGMICRO continues strategies accordingly ensuring the delivery of competitive products and

to expand our product portfolio in response to market demand successfully solutions. We are also cultivating a forward?looking pipeline of new

introducing a series of products characterized by diversity completeness and technologies and products to reinforce our long?term competitiveness.refined segmentation.In fiscal year 2025 our R&D investment totaled 1.045 billion RMB representing a

26.81% share of total revenue for the period. This marks an 20.03% increase in R&D Team

R&D investment compared to the previous year. This significant investment has

yielded strong results as evidenced by our expanded portfolio of nearly 900 part

numbers. This demonstrates the effectiveness of our R&D efforts in broadening The construction and cultivation of our talent pool have always been a strategic

our product matrix. priority at the company. We are dedicated to nurturing outstanding

professionals who resonate with our corporate culture and core values. We

120000 10000 actively attract talent through a wide variety of channels. The size of our R&D

104519.49 team continued to expand with 1335 R&D personnel accounting for 72.75% of

100000 87074.68 8000 our total employees. Of these 751 individuals hold master's degrees or above

6800

5900 which comprise 56.25% of the total R&D personnel providing solid technical 80000 6000

73707.41 5200 support for long-term development.

600004000

40000 2000 2025 Performance:

200001000

0 0 R&D Personnel 1335

202320242025202320242025

Increase from Last Year's Number 151

Increase from Last Year's Number 12.75

Environmental Social and Governance (ESG) Report < 16 >

Investment in R&D (in 10000 RMB)

Historical Sales-Ready Product NumberSGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Intellectual Property System

Numbers of Intellectual Property Rights 2023-2025

The Company strictly abides by relevant laws regulations and standards including the Patent Law of the People's Republic of China the Implementing Rules of the Patent Law of the

People's Republic of China the Trademark Law of the People's Republic of China and the Specifications for Enterprise Intellectual Property Management. It has established a sound (Disclosure Items)

intellectual property management system to provide strong support for sustainable innovation and market competitiveness. During the reporting period the Company continuously

strengthened its IP management system to guard against intellectual property risks. Total Number of Granted Patents

Total Number of Registered IC Layout Design Registration Certificates

Protection of Intellectual Property

600588

SGMICRO prioritizes the protection of its intellectual property in accordance with its Awareness and Capacity Enhancement: 500

management philosophy. The company follows the Intellectual Property Management Launch Intellectual Property Training

Work Manual which is customized to fit its specific characteristics and the integrated 401

circuit industry. These principles ensure that intellectual property matters are handled Popularize Company-wide Awareness: Elevate all employees' awareness of IP 400 370

properly effectively systematically accurately and promptly. The guidelines set protection through regular training sessions. 340

expectations to standardize the intellectual property workflow and enhance 300

company-wide awareness of intellectual property protection. As of the report the Improve Practical Application Capabilities: Deepen employees’ understanding

company continues to advance the application and strategic organization of intellectual of intellectual property knowledge and enhance their practical application 229

259

property rights focusing on building an intellectual property portfolio centered around capabilities. 200

patents covering a wide array of technologies. At the time of this report the company

continued to advance the application and strategic development of intellectual property 100

rights building an intellectual property portfolio primarily centered on patents. Business Cooperation Standardization: Clarify Ownership Rights and Confidentiality Obligations

Protection of Intellectual Property Sign Confidentiality Agreements: Sign confidentiality agreements with relevant 0parties prior to business cooperation initiation to clarify the confidentiality 2023 2024 2025

obligations of all parties.Risk Prevention in Advance: Strengthen

Inquiry and Early Warning Mechanisms Define Ownership Rights: Clearly stipulate the ownership and right to use

intellectual property in contracts to prevent subsequent disputes arising from

Strengthen Patent Early Warning: Establish a dynamic monitoring mechanism unclear ownership.conduct patent intelligence analysis on core industrial technologies and Disclosure Total Number of Total Number of Registered

identify potential infringement risks in advance. Items Granted Patents IC Layout Design Registration Certificates

Improve IP Search Procedures: Conduct rigorous background checks on In 2025 SGMICRO comprehensively upgraded our patent strategy continued to refine

trademarks patents and other intellectual property rights prior to R&D and the internal IP management system and organized patent strategy upgrade training to

product launch to avoid infringement risks. 2023strengthen company?wide IP protection awareness and enhance our core 229 259

competitiveness. These incentive schemes are regularly updated emphasizing

Intellectual Property Strategy and Deployment: innovation the driving force behind our ongoing development. Our patent portfolio

2024370340

Defining Protection Scope and Approach continues to expand. Our patent portfolio continues to expand. At the time of the report the number of patents held by the company further increased. 2025 588 401

Precisely Select Protection Strategies: Adopt different forms of protection

including invention patents utility model patents design patents and trade

secrets flexibly according to technical characteristics and commercial value.Effectively Protect Innovation Achievements: Reasonably define the protection

scope of patent claims to ensure core innovations receive solid and sufficient

legal protection.Environmental Social and Governance (ESG) Report < 17 >

AmountSGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

A Closer Look: Green R&D and Opportunities

Green R&D and Innovation SGMICRO integrates sustainable development into its innovation practices actively promoting the research and development of green low-carbon technologies to create

energy-efficient products. Concurrently the company is seizing new opportunities in green applications to provide customers with solutions for efficient energy utilization

As an analog integrated circuit company committed to continuous improvement meeting the growing demand for intelligent living and environmental sustainability.green research and development isn't just a core driver of our technological

innovation; it's also our unwavering commitment and contribution to building a SGMICRO has incorporated energy consumption reduction design principles in its analog IC design across

greener planet. As the company expands our products are increasingly integrated

into a wide range of industrial and consumer electronics applications. From the various categories.initial stages of product development we strive to embed environmental Efficiency low power consumption and miniaturization are important trends in IC development particularly within the analog chip domain. These are also SGMICRO's

protection principles into every process. Each product we create reflects our deep areas of expertise. Through years of targeted independent research and development SGMICRO has developed technologies intellectual property and products in areas

consideration for environmental sustainability aiming to minimize resource including chip power reduction enhanced power conversion efficiency process optimization and chip size reduction. These include ultra-low power operational

consumption and waste. This approach demonstrates our active response to the amplifiers comparators low-dropout regulators (LDO) Buck-Boost DC/DC converters power solutions for AMOLED displays integrated power modules. These products

industry's trend toward green and low-carbon development. utilize innovative power conversion circuit architectures low-power circuit designs smart dynamic power control technologies and more compact packaging technologies

We have always adhered to the philosophy of "prioritizing energy conservation that significantly enhance power conversion efficiency while reducing energy consumption and raw material usage. The application of these advanced technologies

emission reduction and environmentally sustainable development" in all our R&D strengthens the market competitiveness of the company's products and provides customers with lower-power more energy-efficient and environmentally friendly

activities. We uphold our commitment to green R&D throughout the entire lifecycle solutions. These solutions help extend standby time and overall battery life for smart devices contributing to commercial performance and environmental impact.of each chip from definition and design to manufacturing. In the initial product

definition phase we focus on parameters such as low energy consumption Our products are extensively employed in energy conservation and environmental protection facilitating

compact size and simplified processes. During the circuit design stage we

emphasize reducing overall chip power consumption across various states the across-the-board adoption and rapid development of various green and energy-efficient products.minimizing chip area decreasing chip layer count and enhancing product reliability Global climate change presents both challenges and opportunities. As we address this challenge humanity is compelled to explore and adopt low-carbon and sustainable

and lifespan. For the chip manufacturing process we maintain close development models. Emerging sectors such as clean energy and energy-saving environmental protection offer unprecedented development opportunities. There is a new

communication with our foundry partners to ensure compliance in raw material impetus for economic growth as well as effective means to address environmental issues. Semiconductor technology as the cornerstone of modern society plays a crucial

selection and to monitor the environmental impact of production. These measures role in driving the development of green technology. In response to these opportunities the company began laying out innovative products for applications in the new

enable our products to achieve optimal energy conservation and emission energy and green energy sectors many years ago. Collaborating with relevant end-product manufacturers we have launched multiple next-generation analog IC products

reduction simultaneously conserving raw materials and reducing wastewater gas for energy conservation and environmental protection in various applications such as photovoltaic energy storage lithium battery manufacturing and management

and solid waste emissions during production. Concurrently the superior automation in applications new energy vehicles and third-generation semiconductors. These efforts contribute to the widespread adoption and rapid development of

performance quality and market alignment of our products contribute to a longer various green and energy-efficient products providing a more environmentally friendly and efficient experience for our lives. Furthermore they contribute to improving the

product lifecycle. This in turn extends the lifespan of our customers' end products

consequently reducing electronic waste from devices as well as packaging waste Earth's environment and human sustainable development.thereby alleviating environmental pressures.Case

1 Ultra?Low?Power Buck Converter Case Highly Integrated High?Frequency Buck Power ModuleProduct definition Application of SGMICRO has introduced an ultra-low-power DC/DC buck The company has launched a highly integrated high-frequency buck power module

core technologies converter designed for battery-powered IoT devices housed in a compact eco-friendly 10-pin EMSIP package (2 mm × 2.5 mm × 1.27

Green product requiring minimal standby power. The converter features mm). By combining a synchronous buck converter and an inductor into a single 2 Product design portfolio an ultra-low quiescent current of just 60nA and a module this design minimizes external components and reduces resource light-load efficiency exceeding 80% ensuring a consumption. For maximum efficiency the module features a Power Saving Mode Environmental long-lasting and stable power supply. To support product (PSM) optimized for light loads drawing a typical quiescent current of just 5.7 μA.benefits in miniaturization it is housed in a compact eco-friendly This ultra-low power consumption significantly extends the standby time of

3 application WLCSP (0.89 × 1.19-6B) package and requires only four battery-powered devices. Compact reliable and easy to integrate this module is an Product manufacturing external components. This highly efficient design ideal energy-efficient solution for space-constrained buck applications.Long-life cycle ultimately helps reduce carbon footprints.

application

Environmental Social and Governance (ESG) Report < 18 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Industrial Exchange and Cooperation

SGMICRO has always adhered to an open collaborative and mutually beneficial development philosophy actively contributing to the

growth of the industry ecosystem. Beyond active participation in industry exhibitions and events we drive in-depth participation in

industry associations and high-level conferences. SGMICRO has led or contributed to the development of multiple national and

international standards. Through these efforts the company is committed to building channels for information exchange across

enterprises and working with partners to jointly advance the prosperity and development of the industry.Industry Collaborations (some):

Serial

Number Industry Association/Union Title

1 China Semiconductor Industry Association Member

2 Integrated Circuit Design Innovation Alliance Director

3 China Automotive Chip IndustryInnovation Strategic Alliance Director

4 Beijing Semiconductor Industry Association Member

5 Automotive Electronics Industry Alliance Member

6 Shanghai Integrated Circuit Industry Association Director

7 Shanghai Automotive Chip Industry Alliance Member

8 Shenzhen Semiconductor Industry Association Member

Environmental Social and Governance (ESG) Report < 19 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Strict Quality Control

SGMICRO offers high-performance quality analog IC products. A stringent quality assurance system meets top industry standards ensuring each product is thoroughly tested for

consistency and reliability. We foster a "zero-defect" quality culture guiding all employees to embrace it as a conscientious daily practice. SGMICRO implements our quality policy

across all stages of the supply chain establishing rigorous product quality standards and management processes to ensure high production efficiency and reliable product

performance. By placing customer needs at the forefront the company continuously enhances service quality.Advanced Technology Reliable Quality

By leveraging globally leading technologies and continuous Strive to create reliable and consistent products with

development efforts we have expanded our market share a focus on achieving the highest level of quality and

with advanced high-performance products thereby reliability.bolstering the overall strength of our company. Quality

Customer Satisfaction Policy Continuous Improvement

Maintaining consistent high product quality is essential for The quality management system refined over time

ensuring customer satisfaction while simultaneously ensures continuous product quality improvements—a

striving for continuous improvement. foundational element of our growth.Quality System

We have implemented a comprehensive quality assurance policy in accordance with the Product Quality Law of the People's Republic of China and other relevant specifications

adhering to the highest industry standards. Our guiding principles encompass "advanced technology reliable quality customer satisfaction and continuous improvement". Rigorous

quality assessments are conducted on every product to ensure its quality and reliability. We preferentially select wafer foundries and assembly & test factories with the highest

reliability and yield rates. Additionally every new product undergoes stringent testing against the highest standards to uphold the utmost quality and reliability allowing us to

guarantee our product quality while continually expanding our product lines.Strict product quality standards and quality management processes are established to oversee product design production and sales comprehensively. Rigorous tests are carried out

before product warehousing and shipment. Moreover the company diligently monitors crucial elements such as design standards manufacturing methods production workflows and

testing protocols to consistently enhance product quality and bolster resilience against external factors. This approach ensures both high production efficiency and consistent product

quality.In 2025 we further embedded quality management into our strategic planning aligning closely with high?quality development priorities. We advanced both quality management and

supply?chain resilience. Guided by the differentiated needs of customers across various application sectors we established a full?process service system that strengthens our

end?to?end quality assurance capabilities. At the time of the report our management systems achieved several important milestones. We maintained the validity of our ISO 26262

certification in automotive functional safety expanded our testing capabilities with ISO/IEC 17025 laboratory accreditation and obtained the IATF 16949 Letter of Conformance for

automotive supply?chain quality management. In addition we completed the expansion and upgrade of our ISO 9001 Quality Management and ISO 14001 Environmental

Management System bringing more subsidiaries under unified system coverage. These enhancements have resulted in an internationalized compliance framework spanning four key

dimensions: quality control environmental management laboratory testing and functional safety providing the institutional foundation and management assurance for the company's

long?term stability and continuous operational improvement.Environmental Social and Governance (ESG) Report < 20 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Customer Service

The company upholds a customer?first philosophy prioritizing the fulfillment of customer needs enhancing service quality and striving

to deliver high?quality products and comprehensive solutions. Our distribution strategy primarily leverages product distribution Performance

channels complemented by direct sales. This decision aligns with industry standards and SGMICRO's unique circumstances. By adopting

this approach we effectively reach a broad spectrum of end customers enhance sales channel efficiency expand our customer base

and promote our products.To enhance customer satisfaction we have established a technical support team composed of senior experts to provide comprehensive At the time of the report the customer

responses to customers’ diverse needs. SGMICRO upholds a communication philosophy rooted in integrity transparency and efficiency

ensuring rapid response and close follow?up to customer quality requirements while providing accurate and direct technical support satisfaction score reached

and solutions.To further enhance the effectiveness of customer feedback handling the company continues to improve our Customer Feedback

Handling Specification clearly defining the primary responsible party for each customer issue and standardizing procedures response

measures timelines escalation mechanisms and closed?loop management requirements. These measures ensure that every piece of 92.88%

customer feedback receives timely professional and efficient resolution. The company also conducts ongoing customer satisfaction

surveys and in response to customer suggestions for improvement proactively engages in communication responds promptly and

puts plans into action.Environmental Social and Governance (ESG) Report < 21 >Responsible

Procurement

SGMICRO's powerful and reliable supply chain

is a key competitive advantage. We maintain

close cooperation with our suppliers having

established a standardized process for

supplier onboarding and evaluation. Our

categorized supplier management approach

optimizes oversight reduces costs and

enhances supplier value. Adhering to our

sustainable development philosophy we

integrate critical factors such as product

quality management environmental

protection and social responsibility into our

supplier evaluation system. SGMICRO is firmly

committed to avoiding conflict minerals and

actively promotes sustainable development

throughout the entire industry supply chain.Build a Sustainable Supply Chain 23

Conflict Minerals Management 25SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Build a Sustainable Supply Chain

Integrity Commitment Environmental Management

Letter Complaints

Sustainable Supply Chain

Our company regularly reviews and updates its risk and opportunity assessment criteria. We conduct various risk assessments for our

suppliers developing corresponding mitigation strategies. Furthermore through our business continuity management protocols we

clearly define our business continuity management structure and policies. Review of

Suppliers' Social

To ensure uninterrupted supply we've established and refined a business continuity assurance system regularly assessing risks of

operational disruption. Our proactive measures to prevent supply chain disruptions include: introducing secondary suppliers for Responsibilities

production-related partners based on process types mandating suppliers to establish business continuity plans and stipulating safety

stock requirements for materials.Supplier Management

Environment and Quality Third-party Test Reports

Related Certifications

Our supplier management process covers risk assessment onboarding reviews agreement signing regular evaluations ad?hoc audits (RoHS2.0 HF)

and annual audits.Risk We evaluate new suppliers across multiple dimensions drawing upon international standards such as ISO9001 Review of Suppliers' Social Responsibilities

Assessment IATF16949 and ISO14001. This assessment leverages management systems like ISO14001 QC080000 and ISO45001.At the time of the report the company found no significant illegal or non-compliant activities within its procurement processes. Our

Onboarding suppliers maintained ecological social and quality certifications as listed below:Critically during the initial onboarding phase and on-site audits of new suppliers we consistently include environmental and

Reviews social responsibility criteria. These factors directly influence the supplier's score and overall evaluation outcome.We sign codes of conduct and other relevant agreements with suppliers requiring them to carry out thorough due Percentage

Agreement diligence on their supply chains to ensure full compliance with laws and regulations during their business with our Category Certification of certified Performance:

Signing company. The areas included in due diligence are but not limited to labor rights health and safety environment and suppliers

hazardous substances ethical standards business continuity and information security. ISO 14001 Environmental * The percentage of new suppliers that were

Management Systems 100% screened based on environmental criteria: 100%

Regular We conduct regular performance evaluations that include environmental and social?responsibility criteria issue Environment QC 080000 Hazardous Substance

Evaluations warnings to low?scoring suppliers and require corrective actions to be completed within defined timelines. Process Management System 100% * The percentage of new suppliers that were

screened based on social criteria: 100%

Suppliers commits to ensuring that all business transactions are transparent and accurately reflected in its accounting * The number of suppliers identified as having

Ad?hoc Audits books and records and to guaranteeing the transparency impartiality and fairness of the procurement process. We Society ISO 45001 Occupational Health 100%

continuously optimize our procedures conducting periodic supplier audits to ensure compliance with integrity requirements. and Safety Management System actual or potential significant negative social

impacts: 0

SGMICRO conducts annual audits of suppliers to promote social responsibility emphasizing transparency and * The number of suppliers identified as having

Annual Audits integrity. We require suppliers to comply with legal standards uphold ethical business conduct follow human rights

ISO 9001 Quality Management 100% actual or potential significant negative

regulations and avoid forced or child labor. Suppliers must also avoid conflict minerals and meet environmental Quality IATF 16949 Automotive Quality

standards. Suppliers that repeatedly fail to meet our standards are removed from our approved supplier list. Management System 100% environmental impacts: 0

Environmental Social and Governance (ESG) Report < 23 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Green Sourcing

SGMICRO actively upholds its commitment to a green supply chain. Across all stages from raw material selection to wafer manufacturing

and packaging & testing we rigorously require our supply chain partners to adhere to stringent green environmental standards. They

must provide the latest third-party test reports for raw materials and products ensuring full compliance with environmental protection RoHS Compliance

laws regulations and certification standards. This minimizes the environmental impact throughout the chip's full life cycle in production All our products strictly comply with the Restriction of Hazardous Substances (RoHS) Directive . We conduct

usage and post-disposal phases. full?process investigations verification and testing to ensure compliance with regulatory timelines and to

The company actively encourages and supports its suppliers in implementing sustainable practices. We prioritize suppliers with meet customer requirements.commitments to low-carbon operation and low emissions minimizing environmental and climate impact with partners upstream and

downstream.In our product packaging and information?delivery processes we put green and low?carbon principles into practice: We prioritize

biodegradable and recyclable materials for external packaging. We reduce resource consumption by digitizing product documentation

through barcode scanning and online transmission. We label both internal and external product components with environmental REACH Compliance

markings to ensure compliance with international standards such as RoHS and REACH. In accordance with EU REACH regulations we conduct comprehensive substance reviews to confirm that

our products contain no volatile or intentionally released substances. For non?EU?exported

chemical?related products the concentration of all Substances of Very High Concern (SVHCs) remains

below 0.1% ensuring full compliance with EU regulatory requirements.Environmental Requirements for Packagings

We strictly comply with the P ackaging and Packaging Waste Directive (94/62/EC) and its amendment

(2004/12/EC) ensuring that the total concentration of heavy metals including lead (Pb) cadmium (Cd)

mercury (Hg) and hexavalent chromium (Cr6+) does not exceed 100 ppm in packaging materials.Restricted Substances Management

The company confirms after thorough investigation of our supply chain that plastic materials containing

red phosphorus or antimony trioxide flame retardants are not used. Furthermore all products and raw

materials do not contain perfluorooctane sulfonate (PFOS) perfluorooctanoic acid (PFOA) C9-C21

perfluorocarboxylic acids (PFCA) perfluorohexanoic acid (PFHxA) and perfluorohexyl sulfonic acid (PFHxS)

substances.Halogen-Free Requirements

We have fully adopted halogen?free materials across all product lines. All qualified halogen?free products

are labeled as Pb?free RoHS compliant and HF (halogen?free). We can provide complete material

composition declarations and third?party test reports to ensure that environmental compliance is fully

traceable and verifiable.Environmental Social and Governance (ESG) Report < 24 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Conflict Minerals Management

Our responsible?sourcing framework is built on a strict commitment to eliminating the use of conflict minerals. We have

established a comprehensive supply?chain management mechanism for responsible minerals and formulated the

Environmental Restricted Substances Management Specification which defines conflict minerals clarifies control scope

management and traceability methods and outlines our compliance commitments. We update these requirements dynamically

in line with international regulations industry standards and customer expectations to ensure full alignment with global

responsible?sourcing principles. We have completed supply?chain investigations and disclosures for traditional conflict

minerals—tin (Sn) tantalum (Ta) tungsten (W) and gold (Au)—as well as industry?critical minerals such as cobalt and mica.Traceability information including mineral origins and smelter certifications is referenced through CMRT/EMRT reports.During supplier onboarding we follow the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals and use

tools such as the Conflict Minerals Reporting Template (CMRT) developed by the Responsible Minerals Initiative (RMI) to

conduct due?diligence assessments. This ensures that minerals contained in products manufactured on our behalf such as

gold tin tantalum and tungsten are not directly or indirectly sourced from conflict?affected regions. We also require our

suppliers to sign an Environmental Agreement which explicitly mandates compliance with conflict?free sourcing policies in

accordance with the Dodd?Frank Act (DRC conflict?free policy). Furthermore we have established comprehensive processes to

ensure traceability of materials.The company is diligent in constructing a responsible system for sourcing minerals closely collaborating with upstream and

downstream businesses to promote responsible procurement practices. At the time of the report we have incorporated

hazardous?substance control and responsible?mineral sourcing requirements into our supplier onboarding reviews and regular

audits as core evaluation criteria achieving 100% coverage across all suppliers and ensuring product compliance from the

source of the supply chain. Audit results confirmed that all suppliers have established and implemented Conflict?Free Minerals

Conflict?Free Minerals and have extended conflict?free due?diligence practices to their downstream supply chains ensuring

that key minerals such as tin (Sn) tantalum (Ta) tungsten (W) gold (Au) cobalt (Co) and mica are sourced exclusively from

non?conflict regions.We reviewed 147 smelters or refiners associated with the four conflict minerals (3TG: tin tantalum tungsten and gold). Among

them 127 have been certified under the RMAP program or jointly recognized by authoritative bodies such as RMI LBMA and

RJC. For smelters or refiners that have not obtained certification we have required suppliers to remove them from the supply

chain to ensure that all conflict minerals meet relevant sourcing requirements.At the time of the report 100% of the mineral raw materials in our supply chain originated from RMI?recognized smelters and

compliant mineral?producing countries. Several key suppliers have also obtained Responsible Business Alliance (RBA)

responsible?sourcing certifications ensuring that our supply chain remains fully traceable and verifiable.Performance:

* Percentage of the mineral raw materials used by SGMICRO *Traceability white list rate: 100%

sourced from RMI-certified smelters or countries: 100%

*Supplier due diligence rate: 100%

*Suppliers with hazardous substances and conflict mineral

management system: 100%

Environmental Social and Governance (ESG) Report < 25 >Green

Comes First

In response to the global challenges posed

by climate change SGMICRO puts

sustainable?development principles into

practice and continues to explore and

innovate. We are committed to embedding

green?development concepts throughout

our entire business and operationalprocesses focusing on “carbon reductionwater conservation waste reduction andenergy efficiency” to minimize our

environmental impact. Through research

and innovation we advance green

low-carbon technologies to support

industry sustainability.Environmental Management Systems 27

Resource Management and Utilization 28

Tackling Climate Change 29SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Environmental Management Systems

Building Environmental Management Systems Environmental Policy

SGMICRO strictly adheres to laws and regulations of the People's We advance environmental management through a systematic In setting our environmental objectives we focus on key dimensions: solid?waste recycling and control rates noise emissions electricity

Republic of China including the E nvironmenta l Protection Law and standardized approach embedded across all business consumption and hazardous?substance management. We issued the Quality and Environmental Objectives Release O r d e r incorporating

Water Pollution Prevention and Control Law Air Pollution processes continuously enhancing our internal environmental these targets into the annual management review and establishing a closed?loop mechanism of “Plan-Do-Check-Act.” In 2025 our

Prevention and Control Law Prevention and Control of management system in accordance with the ISO 14001 standard. environmental management system continued to operate effectively and successfully passed the annual surveillance audit providing a

E nvironmental Pollution by Solid Wastes Law and Environmental In 2025 we updated and refined our Environmental Management solid foundation for the standardization and institutionalization of our environmental management practices.N oise Pollution Prevention and Control Law. Upholding a green Manual further clarifying leadership responsibilities

development philosophy we actively support China's "carbon departmental roles and pathways for achieving environmental

neutrality and peak carbon emissions" goals and diligently fulfill objectives ensuring that the environmental management system

our social responsibility for energy conservation and emission remains closely aligned with the company's strategic direction.reduction. Legal compliance Continuous improvement

Compliance with applicable laws Continuous improvement of the

regulations and other requirements environmental management system

Responsibilities of management in environmental management

Risk prevention Green operation

Energy conservation emission Provide the best products and

reduction pollution prevention services for green energy customers

and control and promote a green supply chain

Taking accountability Ensuring that environmental policies and Ensure the integration of the Ensure that the

for the effectiveness environmental objectives are established and environmental management resources needed for

of the environmental are compatible with the strategic direction system requirements into the the environmental

management system and the context of the organization organization's business management system

processes are available Environmental Monitoring and Awareness

We have established a routine environmental?monitoring mechanism to regularly analyze energy consumption waste generation and

noise emissions across our operating sites. Any abnormalities trigger immediate investigation and corrective actions to ensure

environmental performance remains under control.For noise management we strictly comply with GB12348-2008 Industrial Enterprise Boundary Noise Standards Class III functional areas

Promoting continual Directing and supporting Ensure that the Communicating the importance of effective standards . We conduct regular maintenance on noise?generating equipment to ensure below 65dB during the day and below 55dB at

improvement persons to contribute to the environmental environmental management and of night (from 10:00 PM to 6:00 AM the next day).effectiveness of the management system conforming to the environmental To strengthen environmental awareness among all employees we leverage the ISO 14001 environmental?management system to

environmental management achieves its intended management requirements deliver comprehensive training including waste?management programs that promote waste sorting and recycling helping employees

system outcome(s) integrate environmental responsibility into daily work practices. In 2025 100% of the employees participated in environmental

protection-related training.Environmental Social and Governance (ESG) Report < 27 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Resource Management and Utilization

Energy Management Case Rooftop Solar Project at Jiangyin Site

Our company actively supports environmental protection by prioritizing the effective We actively expand the use of renewable energy across our operations. In 2025 the rooftop photovoltaic (PV) project at our Jiangyin site was officially commissioned with an

and strategic use and science-based management of energy. We integrate these practices installed capacity of approximately 550 kW. The facility generated 314195.6 kWh of

into our daily operations and implement energy-saving and emission-reduction solar power during the year accounting for about 5% of its total electricity

policies. This approach not only reduces our environmental impact but also optimizes consumption. We will continue to optimize our energy?use structure by increasing the

production structure thereby enhancing our corporate competitiveness. share of renewable energy including through the procurement of green electricity.Energy-saving and Reduced Consumption in Practice Water Resource Management

Enhancing equipment operation and maintenance efficiency:

We standardize equipment?operation management and conduct regular inspections We follow the principles of “prioritizing conservation and promoting reuse” and have

maintenance and repairs to eliminate potential faults in a timely manner ensuring efficient established a full?process water?resource management system. In managing our use of

stable and safe equipment performance. water we refer to the Energy and Resource Control Procedure to collect monthly

water?consumption statistics across all operating sites supported by an anomaly?alert

mechanism to promptly identify and address leaks waste or other irregularities.Refined energy?consumption management: Conservation awareness is reinforced through signage in public areas and the

The Integrated Management Department tracks and analyzes monthly electricity and water promotion of water?saving devices.consumption across all operating sites supported by an anomaly?alert mechanism to ensure For water recycling our Jiangyin site has constructed a rainwater?collection pool with

timely investigation and resolution of abnormal energy?use patterns. collected rainwater used for landscape irrigation. In 2025 a total of 332 tonnes of

rainwater were utilized reducing reliance on city water sources. Utility & auxiliary

Employee engagement in energy conservation: facility systemsuch as air?conditioning and vacuum systems adopt circulating?water

reuse models to further enhance water?use efficiency.We promote energy?saving behaviors by placing visible reminders on water electricity and

paper conservation in public areas and reinforcing these messages through training and

cultural initiatives encouraging employees to adopt sustainable habits in daily work. Waste Disposal

Standardized air?conditioning energy management:

All office areas are equipped with variable?frequency air?conditioning systems and we SGMICRO develops and sells analog ICs outsourcing manufacturing. For general solid

strictly enforce temperature?control standards of no lower than 26°C in summer and no waste and small quantities of hazardous waste generated from our operations we have

higher than 20°C in winter to effectively manage HVAC energy consumption. established dedicated waste?management procedures to ensure 100% classified

storage with clear labeling. Waste?segregation and recycling points are established

across our operating areas and provide employees with waste?management training to

Optimized paper-use management: promote proper waste sorting and the reuse and recycling of materials. We also maintain waste disposal records and have contracts with third-party processors to

We maintain a paper?use monitoring and management mechanism promote double?sided ensure compliance.printing and paper reuse and advance paperless office practices to reduce paper waste.For all end-of-life electronic products test kits and other electrical equipment the

company partners with qualified professional recycling organizations for proper

disposal. Similarly discarded ink cartridges toner cartridges computers and other

Low?carbon lighting system upgrades: devices from all regional offices are collected by the local IT department. These items

LED energy?efficient lighting has been installed throughout the office and public areas. are then regularly retrieved and documented by certified environmental protection

Leveraging their high luminous efficacy and low power consumption we improve agencies. For the small quantities of hazardous waste generated we collect and

lighting?energy efficiency and reduce electricity usage associated with lighting systems. transfer such waste to licensed hazardous?waste disposal service providers ensuring

compliant treatment and effective control of environmental risks.Environmental Social and Governance (ESG) Report < 28 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Tackling Climate Change

In 2025 following the latest guidance from the Shenzhen Stock Exchange and the recommendations of the Task Force on Climate?related Financial Disclosures (TCFD) we conducted a

preliminary identification of climate?related risks and opportunities. This work supports our low?carbon transition and advances the alignment of business development with climate

protection.Climate Governance Structure Green R&D Strategy:Upholding the philosophy of "prioritizing energy conservation emission

01 reduction and environmentally sustainable development" We are committed to our environmental duties throughout the entire lifecycle of

We place strong emphasis on climate?change management. To effectively address each chip from definition and design to manufacturing. Our products'

potential climate?related risks and opportunities we have integrated strong performance and quality contribute to longer product lifecycles

climate?management responsibilities into our ESG governance framework. Clear roles reducing electronic waste from chips and end?user devices as well as

and responsibilities are defined across all management levels supported by regular associated packaging materials thereby alleviating environmental pressure.assessments analyses and response actions. We also review progress toward our

medium? and long?term carbon?reduction goals and ensure the implementation of

climate?management initiatives.Low?Carbon Operations Strategy:

Climate?Response Strategy 02 We integrate green and low?carbon principles into core operational processes; Reduce operational carbon emissions by optimizing our energy

structure improving energy efficiency and advancing energy?saving and

emission?reduction initiatives.Grounded in our industry's characteristics and operational realities we have developed

a multi?dimensional climate?response strategy centered on three pillars: risk mitigation

opportunity capture and low?carbon transition. These strategies guide the

implementation of climate?action measures across the organization.Supply?Chain Collaboration Strategy:

03

Low?Carbon We promote collaborative decarbonization across the supply chain Green R&D encouraging suppliers to strengthen environmental management and Operations Strategy implement emission?reduction measures to jointly build a green value chain.Strategy

Climate?

Response

Strategy

Climate Adaptation Strategy:

Low?Carbon Supply?Chain 04 We enhance climate?resilience capabilities by establishing flexible Operations Collaboration emergency?response mechanisms upgrading facility standards to better withstand extreme weather and strengthening supply?chain resilience

Strategy Strategy through diversified sourcing and inventory management to mitigate

climate?related disruption risks.Environmental Social and Governance (ESG) Report < 29 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Climate Risk Identification and Management Case Enhancing Climate Resilience Through Flood and Typhoon Emergency Planning

To strengthen our resilience to extreme weather events we developed and implemented a F lood and Typhoon Emergency Planning establishing a coordinated response

In 2025 following our climate?impact risk and opportunity management process mechanism led by an emergency command team and supported by cross?functional departments. Through pre?season preparation facility inspections and at least one

which covered identification assessment prioritization and management we emergency drill and training session each year we enhanced our capabilities in power?supply assurance personnel evacuation and supply?chain recovery. The plan has

conducted a comprehensive evaluation of climate?related transition risks and effectively mitigated the impact of heavy rainfall events safeguarded business continuity and reduced secondary environmental risks supporting both stable operations

opportunities to ensure alignment between business development and and ecological protection.climate?transition response.Climate Impact Risk and Opportunity

Management Process Climate Targets and Actions

We systematically review internal and external climate?related

Identification factors across production operations supply?chain SGMICRO identified "mitigating climate change and promoting sustainable development"

collaboration customer markets and technology development as the core initiative of our environmental responsibility. We have since made a formal

establishing a comprehensive list of climate?related risks and climate action commitment and set mid- and long-term carbon reduction targets.opportunities to ensure no material issues are overlooked. Carbon emission reduction performance is regularly tracked and assessed.Evaluations Identified risks and opportunities are evaluated based on

three core dimensions: severity likelihood and detectability. Our promise:

Using 2025 as the base year

we are committed to reducing the carbon emissions of per million sales in

Prioritization Based on assessment results risks and opportunities are scope I+II in owned facilities by 50% by 2030

prioritized by significance with risk levels defined to guide

resource allocation and action planning. and to reduce carbon emissions of per million sales in scope I+II in owned fa-

cilities by 90% by 2050.Using 2023 as the base year

Management Aligned with our risk appetite and strategic objectives we we are committed to reducing carbon emissions of per million procurements

formulate differentiated response strategies to ensure by 25% by 2030.effective implementation and measurable outcomes.In 2025 following the recommendations of the Task Force on Climate?related Financial We have established a greenhouse?gas (GHG) inventory mechanism covering Scope I

Disclosures (TCFD) and industry practices we conducted climate?risk and opportunity direct emissions and Scope II indirect emissions from purchased energy. We regularly

assessments for our headquarters and major operating sites. The assessment identified review carbon?emission data and track progress toward our reduction targets. In 2025

potential transition risks and opportunities including three categories of risks: policy our Scope I GHG emissions totaled 11.35 tonnes of CO?e Scope II emissions totaled

and regulatory risks technology risks and market risks and two categories of 6276.17 tonnes of CO?e and our overall GHG emissions amounted to 6287.52 tonnes

opportunities: supply?chain compliance opportunities and green?product opportunities. of CO?e.Environmental Social and Governance (ESG) Report < 30 >People-oriented

Together We Thrive

The stable growth of our talent team is the core

driving force behind the company's sustainable

development. SGMICRO consistently upholds a

talent philosophy of "integrity and competence

dedication to teamwork pursuit of excellence

and practical responsibility" coupled with a

people-centric approach to long-term growth.We're dedicated to providing a broad career

platform for all employees and fostering a fair

diverse and safe work environment. SGMICRO

deeply cares for the well-being of every

employee continuously optimizing our welfare

system building advanced and efficient training

mechanisms and actively exploring diverse

communication channels. We're committed to

fulfilling our employees' aspirations for the

future working hand-in-hand with them to plan

and achieve the company's long-term vision.Recruitment 32

Employee Benefits 33

Talent Development 36

Health and Safety 39

Social Responsibility 40SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Recruitment

We actively create employment pathways and job opportunities for persons with

Careers disabilities. In office buildings where conditions permit we have also installed accessible ramps and barrier?free restrooms to provide a more inclusive and convenient working

environment. At the time of the report the company had 15 disabled employees.Anchored in our people?first philosophy SGMICRO has long pursued diversified

talent?acquisition pathways combining campus recruitment with social recruitment to Experienced Recruitment Year Number of total employees

maintain an open inclusive and diverse talent?entry system. During the selection

process the company strictly adheres to the principles of fairness impartiality and As our company continues to grow and expand our ability to attract talent

transparency. By attracting talent with diverse experience and backgrounds we consistently strengthens. We actively utilize a variety of recruitment channels 2025 1835

continuously drive innovation and growth laying a solid foundation for the company's and methods including but not limited to various job boards our company

stable development and future strategic advancement. website and official WeChat accounts. This approach helps us attract seasoned 1598

industry professionals bolstering our talent pool and continuously refining our 2024

At the time of the report we continued to enhance our employer brand attracting and talent pipeline. This in turn meets our increasing talent demands and

cultivating top talent through various campus activities and training programs. We also accelerates our technological innovation. 2023 1415

brought in experienced technical and management personnel through external hiring initiatives.

20221243

Diversity of Talents 2021 858

2020572

Our company is dedicated to fostering a diverse and inclusive work environment. We

strictly adhere to a non-discriminatory hiring policy basing all employment decisions

solely on an individual's work abilities and the requirements of the position. We

unequivocally prohibit discrimination based on race color ethnicity age nationality Gender Male: 65.99% PhD: 1.25% Master's degrees: 47.41%Education

pregnancy status religion union membership social background educational level Female: 34.01% Bachelor's degree or under: 51.34%

disability gender marital status ethnic origin or political affiliation. Furthermore the

company explicitly prohibits sexual harassment and all forms of inappropriate conduct

striving to protect the dignity and safety of every employee. 40+ yrs old: 20.76% Technicians: 74.06% Administration: 4.09%

Age 30 to 40 yrs old: 36.62% Position Sales: 14.11% Finance: 1.31%

Under 30 yrs old: 42.62% Production: 6.43%

Measures for Diversity

Policy making: SGMICRO has incorporated equal employment and diversity

guidelines into our management framework which are communicated to

employees through various means such as new employee training programs Compliance in Employment Practices

and assemblies ensuring their understanding and adherence to the guidelines.Campus Recruitment Establishment of supervision mechanisms: The company has established

effective supervision mechanisms led by the Human Resources Department to The company thoroughly verifies the age of applicants to ensure that only employees

The company introduces its company culture and recruitment process for a regularly inspect the implementation of equal employment and diversity aged eighteen and above are hired in compliance with legal requirements. We respect

range of different job opportunities through campus recruitment leveraging policies able to promptly identify issues for improvements. the fundamental labor rights of our employees and value their freedom to choose their

online and offline promotional efforts as well as campus-enterprise Enhanced communication and feedback: SGMICRO promotes and employment setting a zero-tolerance policy towards forced labor and human

collaborations. This strategic approach not only expands our talent pool but strengthens employee communication through various channels and methods trafficking. No violation was reported at the time of the report.also fulfills our corporate social responsibilities contributing to our reputation encouraging employees to provide feedback and suggestions on equal

as an exceptional employer. employment and diversity policies.Environmental Social and Governance (ESG) Report < 32 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Employee Benefits

Compensation and Performance

Our company embraces a "total compensation" philosophy offering industry-competitive salaries and benefits to attract and retain key

talent who drive our future growth. While ensuring overall fairness and equity our compensation structure favors those who take on

greater responsibility and create high value. We adjust compensation based on actual economic performance labor market conditions Work Hours and Holidays

and industry developments in conjunction with individual employee growth and performance. We are committed to equal pay for equal

work ensuring no differential treatment based on an employee's gender. SGMICRO is attentive to employees’ needs and actively promotes a culture of care and support. The company champions

work-life balance for our employees ensuring compliance with relevant laws and regulations. Employees are entitled to

SGMICRO's long-term focus emphasizes a balance between performance targets and individual/team development driving sustained statutory holidays weekends off sick leave maternity leave and other leave arrangements.improvement. We encourage employees to aspire to ambitious goals to ignite greater passion performance and growth. In 2025 we

continued to implement our integrated “Strategy–Organization–Individual” performance alignment framework translating corporate

development goals into clear and actionable individual performance indicators to ensure that employees and the company move in the Gender Equality

same direction. Performance results are further integrated into talent assessment and role matching across business functions enabling

more data?driven workforce decisions and reinforcing the organization's overall execution capability. At the time of the report the A firm believer in equal pay the company provides female employees with equal employment and career development

coverage rate of comprehensive performance management (including performance evaluation performance coaching and performance opportunities placing great importance on safeguarding the lawful rights and interests of our female employees. In addition to

goal setting) reached 100%. statutory benefits such as maternity leave and childbirth?related leave we provide female employees with maternity insurance

dedicated mother?and?baby rooms and special benefits for International Women's Day.Employee Incentives

We use various incentive mechanisms such as performance bonuses employee benefits and recognition programs to boost employee

dedication and satisfaction while strengthening our company's cohesion. Our long-term equity incentive plans allow employees to share

in the company's growth. This continuously attracts and retains skilled technical and management talent who strongly identify with our

culture and values. It helps ensure the stability of our core team while constantly injecting vitality into our ongoing development. In

recent years we've significantly enhanced these long-term incentive programs launching seven plans since becoming a public

company closely aligning company performance with employee interests and fostering a shared focus on long-term growth. At the

time of the report we implemented the 2025 Stock Option Incentive Plan and 2025 Stock Option Incentive Plan Phase II granting stock

options to 1464 recipients including senior management core managers and the backbone members of our technical (operation)

teams covering over 90% of the total number of the company's employees at the time.Rights and Benefits

SGMICRO strictly adheres to national laws and regulations in China such as the Labor Law Labor Contract Law and Law on the

Protection of Minors. Additionally we comply with international guidelines and standards including the Universal Declaration of Human

Rights the Core Conventions of the International Labor Organization and the UN Guiding Principles on Business and Human Rights. We

are committed to fairness equity and transparency and we fully respect and safeguard the fundamental rights and legitimate interests

of all employees.Environmental Social and Governance (ESG) Report < 33 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Employee Benefits

Flexible working hours Employee health Promoting flexible

and remote works Improve team cohesion management leave practices

Through flexible working A diverse range of sports events We have established a multi?tier Paid sick leave is offered to all

arrangements and dual?location and team-building activities are health?protection system employee to ensure their physical

office setups in key business cities organized regularly to enhance achieving 100% annual well-being.we enhance employees’ team solidarity and cohesion. physical?examination coverage

commuting experience while through certified medical

reinforcing our commitment to institutions and providing

green and sustainable office supplementary commercial

operations. accident insurance to ensure

comprehensive protection of

employees’ health and safety.Customized festive Enhancing logistical Establishing assistance Expanding overseas

benefits support mechanisms protection

We have established a In several cities we provide We maintain a long?term care For employees traveling abroad

personalized festival?benefit convenient shuttle transportation mechanism to support employees for business we provide additional

platform that offers a wide range and well?equipped employee and their immediate family overseas insurance to strengthen

of welfare packages including cafeterias to make daily life easier. members in times of serious their protection.cultural experiences lifestyle These services help employees illness. Through a dedicated

services and smart?device concentrate on their work while assistance program we offer

options to meet employees’ benefiting from a more financial aid or leave?related

diverse preferences and needs. comfortable and supportive support depending on the specific

environment. situation.Environmental Social and Governance (ESG) Report < 34 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Employee Communication Employee Grievance Report

SGMICRO values the input of all employees and encourages honest and effective communication as part of our corporate structure and SGMICRO upholds the core principle of "respecting every employee's voice" by establishing a robust grievance management system and

culture. To foster an open and inclusive workplace the company has implemented communication management procedures to welcome a timely response mechanism. Based on the principles of being "objective fair and just" the company offers multiple feedback channels:

diverse suggestions and advice while ensuring prompt and appropriate responses. We maintain open communication channels through reporting to direct supervisors or department heads; submitting complaints via the company's internal dedicated email; using suggestion

employee assemblies regular HR communications quarterly review meetings and suggestion boxes. We have also established a boxes; and directly contacting the HR department or the management.normalized communication mechanism that covers different employee groups. HRBPs in each region are responsible for timely

engagement and feedback collection while managers at all levels actively respond to and address employee concerns. The company strictly enforces confidentiality throughout the grievance process to protect employee privacy. Upon receiving a complaint

or appeal we respond promptly with a thorough and impartial investigation while providing regular updates to the employee on the

progress. All decisions are made fairly and reasonably based on investigation findings in full compliance with company policies ensuring

the protection of employees' legitimate rights and interests.Employee Communication Channels

Employee Assembly Quarterly Review

Regular

Meetings Communications Suggestion Boxwith HR

Employee assemblies are In quarterly review meetings A mechanism for regular Suggestion boxes are

organized periodically which departments report on communication with HR is in available at all office

cover policy briefings progress and exchange place focusing on facilitating locations. Managed by the

performance reviews and thoughts. This practice dialogue between different HR department these boxes

communication on the future ensures all departments align employee groups including collect employee opinions

outlook of the company. in their direction. new hires long-time and suggestions which are

These meetings ensure that employees frontline staff then forwarded to relevant

all employees are informed middle managers and key departments and individuals

about the company's personnel. This approach for follow-up.strategic direction maintains timely exchange

development goals and and feedback across the

major decisions enhancing company.their sense of belonging and

solidarity.Environmental Social and Governance (ESG) Report < 35 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Talent Development

Recognizing that talent is the cornerstone of sustainable growth SGMICRO is dedicated to fostering an environment of mutual development for both the company and its employees.Our people-oriented open inclusive and proactive corporate culture combined with abundant career development opportunities driven by our rapid expansion and a comprehensive 2025 Annual Performance

compensation and incentive program is crucial for attracting motivating and retaining top talent.

78.73100

Employee Development Employee Training Training time on average per person (hrs): Training coverage rate (%):

SGMICRO focuses on employee growth offering career paths for technical Employee growth powers our company's sustainable development. At the time of the report our

specialization and team management along with cross-functional mobility. As the training initiatives were guided by the goal of “driving organizational effectiveness.” Through a

company evolves employees gain expanded job responsibilities and career prospects. combination of learning initiatives we stimulated organizational learning momentum and

They can develop skills move into leadership or explore new roles across departments. empowered employees to advance from basic adaptation to competence and ultimately

A structured promotion system ensures opportunities for mutual growth. excellence driving holistic improvements in organizational efficiency and performance.We have built a well?structured and comprehensive training framework covering onboarding

programs professional and technical development management capability building and general

competency enhancement. Leveraging online and offline learnings along with a structured

process that evaluates training outcomes and ensures that learning is effectively applied in

practice we continue to strengthen training effectiveness. This ensures that talent development

contributes meaningfully to the company's long?term and sustainable growth.Technical Path and Management Channel

Technical Path

Our business expansion is driven by effectively meeting the ever-growing

demands of our customers and target markets. This will create increased

opportunities for our employees to develop innovative and complex solutions

continually enhancing their technical expertise.Management Channel

The company offers a clear and accessible promotion path providing

significant career development opportunities for employees ready to assume

greater management responsibilities. This framework empowers individuals to

fully leverage their management skills and expertise supporting their career

progression goals.Environmental Social and Governance (ESG) Report < 36 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

2025 Training Programs (examples)

New Graduate Training Program Case Learning through Competition

For many years our “Shining Future” program has served as our employer brand for graduate training providing new graduates

with comprehensive and structured onboarding and early?career development. The curriculum covers the company's history At the time of the report we organized a product knowledge competition to help employees gain a comprehensive

corporate culture and core values product portfolio organizational structure business conduct standards general professional understanding of our product portfolio and master core value propositions technical advantages application scenarios

skills and technical competencies. For graduates in sales and field application support roles we offer a 4–6?month systematic and customer solutions. By combining quizzes structured learning and competitive activities the program encouraged

on?the?job training program. This includes: foundational competency development tailored to job requirements; comprehensive employees to identify knowledge gaps refine their capabilities and deepen their understanding of our products and

product and customer?application training; and practical customer?visit exercises. These initiatives help new graduates quickly business. This initiative strengthened employees’ professional competence supported performance improvement and

understand the company integrate into their teams build a solid professional foundation and successfully transition from contributed to enhancing overall team competitiveness and driving the company's long?term development.campus to the workplace.SGMICRO focuses on providing employees with up-to-date technical knowledge and industry trends to promote new product research

Management Training and development which are the key drivers behind the company's growth. To achieve this we offer internal training to improve R&D

skills for new employees ensuring we remain technologically advanced. Furthermore we work with external partners to offer courses in

We organize management?development programs for managers at all levels including coaching?mentor training and quality management organizational management and business compliance which helps strengthen our overall competitiveness.performance?management training. These programs help newly promoted managers understand their roles and strengthen their

capabilities in coaching new employees conducting performance evaluations setting work objectives and providing ongoing guidance.Technical Training Case Supporting employee skill advancement

We continue to build a diversified and systematic professional development framework for our technical teams. Through a series

of thematic training programs we help employees enhance their professional knowledge and stay informed about technological We actively support all employees in obtaining the professional qualifications required for their roles helping them deepen

trends. Technical teams also conduct in?depth discussions and knowledge?sharing sessions based on project needs their expertise and strengthen their professional capabilities. At the time of the report with the company's encouragement

strengthening internal experience accumulation knowledge sharing and technical exchange. By promoting efficient learning and support employees successfully obtained the VDA 6.5 German automotive product audit certification the ESD

technical collaboration and continued innovation we enhance our overall capabilities in tackling technical challenges and electrostatic?protection internal auditor training certification and the ISO 26262 functional safety internal auditor

advancing independent innovation. certification.Environmental Social and Governance (ESG) Report < 37 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Industry-university-research Cooperation Employee Care

Our company is dedicated to fostering deep industry-university collaboration and A rich array of cultural activities is crucial for sparking creativity and strengthening team

nurturing talent in the integrated circuit field by combining the academic resources of cohesion. Our company regularly organizes diverse events that provide employees with Case

universities with our own professional expertise. We engage with universities through opportunities for physical well-being help them manage their work pace and offer a Care for Female Employees

scholarships innovation competitions textbook reform and curriculum collaboration to platform to showcase personal talents. These activities also foster communication and

bring industry?relevant engineering concepts and practical insights to faculty and collaboration among colleagues creating an open lively and proactive work

students. These initiatives strengthen the integration of theory and real?world At the time of the report we organized the “She Shines with Spring”

application while supporting the cultivation and reserve of practice?oriented and environment. At the time of the report we organized a variety of activities including employee?care activity inviting female employees to write down their

innovation?driven talent that align with the company's long?term development needs. sports competitions employee birthday celebrations women?focused care initiatives aspirations for personal growth work–life development and future goals and the annual company trip. These activities strengthened employee engagement and and seal them in a “time capsule” as a record and reflection of their

contributed to a positive and supportive workplace environment. commitments. Through a warm and ceremonial experience the activity

encouraged employees to focus on their development and inner voice

strengthening their self?recognition and motivation. When the time

capsule is opened the following year employees will be able to revisit

their goals observe the progress made and reflect on the adjustments or

breakthroughs achieved along the way celebrating the small yet

significant steps in their journey. The initiative not only diversified our

employee?care practices but also reflected our respect for women and

our commitment to supporting employee growth. It enhanced employees'

sense of belonging and happiness in the company while cultivating a

positive inclusive and caring work environment.Case Chip innovation competition

At the time of the report we continued to put industry-university collaboration into practice

by serving as a major sponsor of the university chip?design competition. We provided three

real?world engineering cases which were deconstructed and explained by our engineers

enabling students to learn practical experiences that are rarely covered in conventional

coursework. This initiative strengthened students’ innovative thinking and professional skills

contributing to the development of future talent and supporting the long?term growth of

the semiconductor industry.Environmental Social and Governance (ESG) Report < 38 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Health and SafetyIn terms of occupational health measures for our staff SGMICRO has always believed in “Safety first Prioritize prevention; People-oriented Scientific management; Energy-saving andreduced consumption Control pollutio; Honesty and compliance Continuous improvement.” We continue to reinforce the fundamentals of our occupational health and safety First aid supplies: First aid kits and commonly used trauma medications are available

management placing strong emphasis on safety?risk prevention and the cultivation of a safety?first culture. Through these efforts we effectively reduced potential hazards and in the workspace for prompt emergency response in case of employee accidents.created a healthier safer workplace that protects the well-being of all employees.Renovation material selection: We prioritize the use of eco-friendly renovation

materials to minimize harmful substances. All materials chosen for our office spaces

Occupational Health and Safety System Risk Management meet environmental protection requirements. Furthermore prior to official occupancy air quality testing is conducted to ensure compliance with national

environmental standards thereby providing a healthy office environment.The company strictly complies with occupational health and safety laws regulations The company is committed to creating a healthy safe and well?regulated working

and standards in all regions where it operates. We have established the Occupational environment. For office and production environments we strictly control safety and Safety performance

Health and Safety Manual continuously optimizing the safety management system and environmental standards across facility procurement material selection and

operational processes clarifying the responsibilities authorities and relationships of construction processes. We also implement systematic safety management in Index 2025 Index 2025

various levels of positions. Following the PDCA (Plan-Do-Check-Act) management equipment?intensive areas such as factories and laboratories to ensure robust

model we are constantly improving the company's system as well as the overall protection of employees’ occupational health and safety. Recordable accidents 0 Major accidents (Resulting in

performance on occupational health and safety. Additionally we conduct regular safety 0disability or loss of life)

inspections and maintenance at production facilities and workspaces to ensure timely Lost days of work- 0

identification and elimination of potential safety hazards. related accident Employee health check 100%

coverage rate

We followed the requirements of the ISO 45001 Occupational Health and Safety Occupational Health and Safety Management Measures Occurrences of 0occupational disease

Management System in establishing an EHS (Environment Health and Safety) group

and refined our occupational health and safety management standards and Facilities procurement: We prioritize the purchase of environmentally friendly

procedures. In 2025 we released and revised our safety management system by materials and equipment to mitigate potential impacts on employee health from the

introducing or revising over ten occupational health and safety policies and procedures. equipment and the environment at work. We avoid the use of harmful materials and Developing a Safety Culture

reduce air and noise pollution. Additionally regular inspections and maintenance of

facilities along with their safety components are conducted to ensure safe and

proper operation and reduce the risk of equipment failure. At the time of the report we promoted occupational health and safety policies and

Measures to raise employees' safety awareness management requirements through training internal communications and other Our work environment: We've created human-centered multi-functional spaces channels ensuring that our health and safety principles are effectively embedded in

1. Specialized courses on "Environment Health and Safety" are incorporated including break areas and dining zones to help employees relax and recharge during daily operations. In addition all office locations organized employees to participate in work periods. All company offices are equipped with drinking water dispensers and

into employee training programs with organized learning sessions and annual fire?drill activities conducted by relevant authorities further enhancing we regularly replace water filters to ensure the healthiest drinking water for our staff.assessments for employees. employees’ fire?safety awareness and emergency?response capabilities while fostering

Laboratory safety measures: We equip laboratory personnel with the necessary a workplace culture in which everyone values and contributes to safety.

2. Fire safety trainings and drills are regularly carried out for all staff and protective equipment and closely monitor its correct and consistent use. We have

firefighting equipment is placed in accordance with regulations to ensure clear implemented multiple protective measures such as installing air?purification

access to fire exits. equipment conducting routine filter replacements and applying anti?static systems

and grounding for relevant devices. These efforts help maintain high air?quality

3. The workplace regularly conducts safety inspections including daily safety standards minimize noise and reduce the risk of safety incidents.

checks major safety inspections before important holidays and specialized

safety inspections. Chemical management: We implement full?lifecycle safety management for

chemicals covering procurement storage use and disposal. We also establish and

4. For laboratories involving chemical use we developed a dedicated continuously update emergency response plans to strengthen our ability to handle

emergency response plan for hazardous?chemical leaks and organized unexpected incidents.targeted training and simulation drills.Occupational health monitoring: Employees exposed to occupational hazards in

5. Safety reminders are posted in lounge areas restrooms and water laboratories are required to undergo occupational health examinations upon

dispensers across the workplace. onboarding during employment and at separation. All relevant workplaces adopt

mechanical ventilation and other standard measures to ensure a safe working

6. The factory holds daily pre-shift safety meetings. environment.

Environmental Social and Governance (ESG) Report < 39 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Social Responsibility

SGMICRO is committed to sustainable development. We recognize the significance of

social responsibility and actively engage in charitable events. We actively fulfill our

corporate social responsibility by organizing and participating in public?welfare

initiatives spreading positive social values and contributing to the creation of a better

and more inclusive community. We have always believed that our long?term growth is

closely tied to the support and trust of the broader community. Moving forward we will

remain committed to public?welfare efforts and continue to contribute to a more

harmonious society through meaningful action?driven initiatives. In doing so we aim to

fully embody the social value and civic responsibility expected of a responsible

corporate citizen.Case Charity and Donation

At the time of the report we put our commitment to

social responsibility into action by hosting a series of

charity bazaars in cities across the country. By giving

unused items a new purpose through charity sales we

created a simple but meaningful way for kindness and

raised funds for local charities. The initiative reflected

the genuine compassion and shared sense of

responsibility embraced by SGMICRO and our

employees.SGMICRO has partnered with charity foundations to

jointly carry out a series of public welfare and charity

activities actively supporting students from

underprivileged remote areas in their pursuit of

education and continuing to create more

heartwarming stories.Environmental Social and Governance (ESG) Report < 40 >Appendix

About this report 42

Key Performance Indicators 43

Key Targets 45

Glossary 47

Feedback Form 47SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

About this Report

Purpose Basis for Compilation

This report (the "Report") is the annual 2025 Environmental Social and Corporate Governance SZSE Self-Regulatory Guidelines No. 17 for Companies Listed on Shenzhen Stock Exchange—

(ESG) Report released by SG Micro Corp and our subsidiaries (referred to as "SGMICRO" or "the Sustainability Report and

company" "company" "we" or "us"). The purpose of the report is to facilitate a transparent

dialogue between SGMICRO and our stakeholders regarding our environmental social and SZSE Self-Regulatory Guidelines No. 3 for Companies Listed on Shenzhen Stock Exchange—

governance practices and to address their expectations with a comprehensive and structured Sustainability Report

approach. Global Sustainability Standards Board (GSSB) GRI Standards 2021

The Chinese National Standard Guidelines for the Preparation of Social Responsibility

Reports (GB/T 36001-2015)

Scope The Chinese Academy of Social Sciences China Corporate Sustainable Development Report Guide (CASS-ESG 6.0)

2030 UN Sustainable Development Goals (UN SDGs)

The disclosure scope of this report is consistent with that of the financial information in

the company's 2025 annual report and some information may involve policies and ISO 26000?2010 Guidance on Social Responsibility

practices from previous years.Compilation Process

Data

This report is based on our company's ESG practices following a process of "project setting and

research information collection drafting and revision executive review board review and public

The report quotes data from various sources including the company's operational information release". At some stages we engage with relevant stakeholders to discuss and validate the

publicly available government documents annual financial reports and internal statistical reports report's framework and content ensuring transparency and alignment with our corporate values.among others. Financial data in this report is presented in Chinese currency RMB. In cases where

discrepancies arise between this report and the financial statements the financial statements

shall take precedence.Versions and Availability

Reliability Guarantee

The report can be accessed and downloaded from the official website of SGMICRO

(www.sg-micro.com) the Shenzhen Stock Exchange website (www.szse.cn) and the

The report contains no false representations misleading statements or major omissions CNINFO website (www.cninfo.com.cn). The Report is available in both Chinese and

and we attest to the truthfulness accuracy and completeness of the contents. English. In case of any discrepancy the Chinese version takes precedence. We welcome

your feedback for the ESG report. Please contact us at Investors@sg-micro.com.Environmental Social and Governance (ESG) Report < 42 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Key Performance Indicators

Business Performance Environmental Performance

Sector Disclosure item Unit 2025 Sector Disclosure item Unit 2025

Revenue RMB 10000 389805.46 Natural gas consumption m3 4104.03

Net profit attributable to shareholders of the listed RMB 10000 54705.94 Gasoline Liters 831.80company

Disel Liters 250.00

Investment on R&D RMB 10000 104519.49 Energy

Business Externally purchased steam ton 943.00

Performance R&D investment percentage % 26.81

Power consumption kWh 11615082.65

R&D personnel person 1335

Externally purchased electricity kWh 11615082.65

R&D personnel percentage % 72.75

Externally purchased green electricity kWh 314195.60

Total cash dividends distributed at the moment RMB 10000 9506.16(with tax) Scope I tCO2e 11.35

Basic earnings per share RMB/share 0.8861 Greenhouse gas Scope II tCO2e 6276.17

Total greenhouse gas emissions (Scope I + II) tCO2e 6287.52

Office operation Water consumption m3 26562.80

Note:

1. The disclosed data are collected from some of the company's operating regions.

2. The emission of greenhouse gases represents the sum of Scope I and Scope II greenhouse gas emissions. The

emissions from Scope I are calculated based on the consumption of natural gas gasoline and corresponding emission

factors. The emissions from Scope II are calculated based on externally purchased steam externally purchased

electricity and corresponding emission factors.Environmental Social and Governance (ESG) Report < 43 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Corporate Governance Performance

Sector Disclosure item Unit 2025 Sector Disclosure item Unit 2025

Number of board members person 6 Total number of obtained patents Piece 588

Corporate person Newly applied patents Piece 141

governance Male directors 2 Patents

Female directors person 4 Total number of newly licensed invention patents Piece 145

Total number of registered IC layout design registration certificates Piece 401

Number of total employees person 1835

Social Performance

Male staff person 1211

Sector Disclosure item Unit 2025 Female staff person 624

Safety Recordable accidents Case 0 Over 50 yrs old person 66

The number of suppliers identified as having actual or Over 40 yrs old person 315

potential significant negative social impacts Number 0

30-40 yrs old person 672

The number of suppliers identified as having actual or

potential significant negative environmental impacts Number 0 Under 30 yrs old person 782

The percentage of new suppliers that were screened PhD person 23

based on environmental criteria % 100 Master's degrees person 870

Supply chain The percentage of new suppliers that were screened Employee

based on social criteria % 100 Bachelor's degree or under person 942

The percentage of RMI-certified supplier % 100 Production person 118

Supplier due diligence rate % 100 Technicians person 1359

Traceability white list rate % 100 Sales person 259

Suppliers with a management system for hazardous Finance person 24

substances and conflict minerals % 100 Administration person 75

Disabled person 15

Average training time per year per employee hrs 78.73

Social insurance coverage rate % 100

Environmental Social and Governance (ESG) Report < 44 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

SZSE Self-Regulatory Guidelines No. 17 for Companies Listed on Shenzhen Stock Exchange— Sustainability Report

Category No. Topic Corresponding chapter

1 Tackling climate change Tackling climate change

2 Pollutant emissions Resource management and utilization

3 Waste disposal Resource management and utilization

Environment 4 Ecosystem and biodiversity protection No relevant information disclosed

5 Environmental compliance management Environmental management system

6 Use of energy Resource management and utilization

7 Use of water Resource management and utilization

8 Circular economy Resource management and utilization

9 Rural revitalization No relevant information disclosed

10 Social contribution Social Responsibility

11 Innovation driven Research Development and Innovation

12 Technology ethics No relevant information disclosed

13 Supply chain security Build a Sustainable Supply Chain

14 Fair treatment of SMEs No relevant information disclosedSociety

15 Product and service safety and quality Strict Quality Control

16 Data security and customer privacy protection Information Security

Recruitment

Employee Benefits

17 Employee

Talent Development

Health and Safety

18 Due diligence Build a Sustainable Supply Chain

Sustainability? 19 Stakeholder Communicatio Stakeholder Communication

related

governance 20 Anti?bribery and anti?corruption Business Ethics

21 Anti?unfair competition Business Ethics

Environmental Social and Governance (ESG) Report < 45 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

GRI Standards Index

Disclosure Corresponding

SG Micro Group reported the information quoted in this GRI content index according to GRI GRI standards

Instructions item chapter

standards between January 1 2025 and December 31 2025. 302-1 Resource management GRI 302: Energy 2016 Energy consumption within the organization and utilization

303-1 The interaction with water as a shared resource Resource management GRI 1 used GRI 1: standard 2021 GRI 303: and utilization

Water and Effluents 2018 303-3 Water consumption Key Performance Indicators

GRI standards Disclosure Cor responding 306-1 Waste generation and significant waste-related impacts

Resource management

item chapter and utilization

2-1 Detailed information about the organization GRI 306: Waste 2020Company Overview 306-2 Management of significant waste-related impacts

Resource management

and utilization

2-3 Reporting period frequency and contact point Company Overview 306-3 Waste generated

Resource management

and utilization

GRI 308: Supplier 308-1 New suppliers that were screened against Build a Sustainable Recruitment Environmental Assessment 2016 environmental criteria Supply Chain

Employee Benefits GRI 401: Employment 2016 401-2 Benefits provided to full-time employees 2-7 Employee

Talent Development (excluding temporary or part-time employees)

Employee Benefits

Health and Safety 403-1 Occupational health and safety management system

GRI 2: (OHSMS)

Health and Safety

General Disclosure 2021 Corporate 2-9 Governance framework and composition governance 403-3 Occupational health services Health and Safety

2-12 In terms of governance impact the supervisory role of

Corporate Occupational health and safety topics:

the highest governance body governance 403-4 worker participation consultation and communication Health and Safety

2-14 The highest governance body's role in sustainability

GRI 403:

Sustainable Development

reporting Management Occupational Health 403-5 Worker training on occupational health safety Health and Safety

Sustainable Development and Safety 20182-22 Statement on sustainable development strategy Management 403-6 Promote worker health Health and Safety

Sustainable Development Prevention and mitigation of occupational health and 2-29 Approach to stakeholder engagement Management 403-7 safety impacts directly linked to business relationships Health and Safety

3-1 Sustainable Development The process of determining substantive issues Management 403-10 Work-related health Health and Safety

GRI 3: Sustainable Development

Substantive Topics of 3-2 List of substantive issues Management GRI 404: 404-1 Average hours of training per year per employee Talent Development

ESG 2021 Sustainable Development

3-3 Management of substantive issues Training and Education 2016Management 404-2

Programs for upgrading employee skills and

transition assistance programs Talent Development

GRI 201: Key Performance GRI 405: Diversity and

Economic Performance 2016 201-1 Directly generated and distributed economic value Indicators qual Opportunity 2016 405-1 Diversity of governance bodies and employees Talent Development

Communication and training about anti-corruption GRI 414: Supplier 205-2 Build a Sustainable GRI 205: Anti-corruption 2016 policies and procedures Business Ethics Social Assessment 2016 414-1 New suppliers that were screened against social criteria Supply Chain

Environmental Social and Governance (ESG) Report < 46 >SGMICRO Message from About Scientific Innovation Responsible Green People-

2025 Environmental Social and Corporate Governance Report the Chairman SGMICRO Management and R&D Procurement Comes First Oriented Appendix

Glossary Feedback Form

This report is the 2025 annual Environmental Social and Corporate Governance (ESG) Report of SGMICRO publicly

Technical Terms Definitions released to society. In order to improve the company's ESG management and enhance our performance in fulfilling ESG

responsibilities we sincerely ask for your opinions and suggestions. Please fill in the feedback form and choose one of

the following methods to send:

Low Dropout Regulator (LDO) is a type of integrated circuit voltage regulator

LDO characterized by its ability to provide a stable output voltage with minimal power loss.

1. What is your overall view of the ESG report

□ Very good □ Goodgood □good Averagegood □ Less than satisfactorygood □ Bad

DC/DC A DC/DC converter is a converter that transforms a direct current power source into another direct current power source with a different voltage or current. 2. Do you think the report can comprehensively and accurately reflect the company's significant economic

social and environmental impacts

Active Matrix Organic Light Emitting Diode (AMOLED) is a type of organic □ Very good □ Goodgood □good Averagegood □ Less than satisfactorygood □ Bad

AMOLED electroluminescent device.

3. Do you think the report can comprehensively and accurately reflect the company's significant economic

social and environmental impacts

Light Emitting Diode is a solid-state semiconductor device with diode

LED □ Very good □ Goodgood □good Averagegood □ Less than satisfactorygood □ Badcharacteristics that can convert electrical energy into light energy.

4. What do you think of the clarity accuracy and integrity of the information data and indicators disclosed

in the report

SVHC Substances of Very High Concern □ Very good □ Goodgood □good Averagegood □ Less than satisfactorygood □ Bad

5. How would you rate the readability of this report including its logical structure content design language

RoHS The restriction on the use of certain hazardous substances in electrical and and formattingelectronic equipment □ Very good □ Goodgood □good Averagegood □ Less than satisfactorygood □ Bad

REACH Registration Evaluation Authorization and Restriction of Chemicals Open-ended Questions

What aspect of this report are you most satisfied with

LBMA London Bullion Market Association

RJC Responsible Jewellery Council Do you have any suggestions for our future ESG reports

Environmental Social and Governance (ESG) Report < 47 >SG Micro Corp

Address: F11 Building D No. 87 North Third Ring Road Haidian District Beijing China

Phone: 010-88825397

Email: investors@sg-micro.com