Stock Code:300729
Loctek Ergonomic Technology Corp.Tel.：0574-55007473
Website：www.loctek.com Sustainability Report
Address：No. 436 Xueshi Road Shounan Subdistrict Loctek Ergonomic Technology Corp.Yinzhou District Ningbo City Zhejiang Province ChinaSustainability Report 2025
CONTENTS
Foreword 1 01 Integrity and Compliance: 03 R&D Quality: Driving Promoting Business About this Report 1 Strengthening Sustainable Sustainable Development for Good through Governance Through Innovation 05 Public Welfare
Message from the Chairman 3 Corporate Governance 41 R&D System Construction 95 Public Welfare and Charity 165
Investor Relations Management 44 Advance New Quality Productive 101 Educational Access 165
Forces
About Us 5 Compliance and Risk Control 46 Universal Participation in Charity 169
Intellectual Property Protection 105
Company Profile 7 Business Ethics and Anti-corruption 50 Community Communication and 170
Corporate Culture 8 Product Quality Assurance 108Information Security and Privacy Exchange 54
Development History 9 Protection Quality Service 117 Support for Rural Revitalization 171
2025 Milestones 11 Sustainable Supply Chain 123 Belt and Road Initiative 171
Participation
Overview of 2025 Outstanding Local Community Development13 172
Achievements
02 Green and Low-Carbon 2025 Honor Highlights Gallery 15Key Performance 17 Development for Environmental Sustainability 04 Empowering Employees and Fostering Inclusive Growth
Response to Climate Change 59 Diversity and Inclusion 131 Appendix
Sustainability Governance 19
Sustainability Governance Framework Change Action 6921 Compensation and Benefits 136 Index of Key Performance 173
Sustainability Strategy 23 Environmental Management 73 Protection of Employees’ Rights and 139 Feedback Form 177
Management of Sustainability-related 24 Resource Efficiency 85 Interests
Risks and Opportunities Democratic Governance 143
Sustainability Metrics and Targets 25 Employee Wellbeing 145
Stakeholder Engagement 27
Occupational Health and Safety 147
Materiality Assessment 29
Employees' Development 158
Special Topic: ESG Practices of 31
LecangsSustainability Report 2025
Foreword
About this Report
This report is the second Sustainable Development Report publicly released by Loctek Ergonomic Technology Corp.(hereinafter referred to as "the Company" "Loctek" or "Loctek Corp."). Prior to this we have published two Social
Responsibility Reports（SSR） and two Environmental Social and Governance (ESG) Reports. This report aims to
truthfully reflect the Company's ESG development and practical achievements during the 2025 fiscal year publicly
disclose the Company's operational performance to stakeholders and enable shareholders creditors business partners
employees and other stakeholders to gain an in-depth understanding of the Company's social responsibility practices.We hope to strengthen communication with stakeholders build consensus and promote sustainable development
through the publication of this Sustainable Development Report.Reporting Scope and Boundary Access to this Report
This report is specific to Loctek along with its branches and subsidiaries. Unless otherwise specified the scope of this In line with our commitment to low-carbon and sustainability practices this report is available for review and download
report is consistent with that of the Company’s annual reports. from the Company’s official website (https://www.loctek.com) and the website of CNINFO (https://www.cninfo.com.cn).For further information beyond what is included here please refer to our annual report or visit our website.Reporting Period
This report covers the period from January 1 to December 31 2025 (the “reporting period”). In order to present more Confirmation and Approval
comparative and forward-looking reporting data certain sections may include retrospective data or forward-looking
statements. This report is published on an annual basis which is consistent with the Company’s financial reporting Upon review and approval by the Company’s Board of Directors on April 24 2026 this report has been published
cycle. concurrently with the annual report. The Board undertakes to supervise the preparation of this report confirming
that the contents of this report are true accurate and complete in all material aspects free from misstatements or
Reporting Guidelines misleading information.Global Reporting Initiative (GRI) Sustainability Reporting Standards (“GRI Standards”)
Feedback
United Nations Sustainable Development Goals (SDGs)
Sustainability Accounting Standards Board (SASB) Standards We value your feedback and welcome any comments or suggestions regarding our corporate responsibility efforts
and this report. For any report-related comments or suggestions please feel free to contact us. Thank you for your
International Sustainability Standards Board (ISSB) IFRS Sustainability Disclosure Standards continued support.China Enterprise Reform and Development Society Guidelines for Chinese Enterprises' Sustainable Development
Reports (CASS-ESG 6.0)
Guidelines No. 17 of Shenzhen Stock Exchange for Self-Regulation of Listed Companies – Sustainability Report (Trial) Board Secretary Office
Shenzhen Stock Exchange Self-Regulatory Guidelines for ChiNext Listed Companies No. 3 - Preparation of Sustainable
Development Reports
Tel.：0574-55007473 Fax：0574-88080232
Data Sources E-mail：law@loctek.com
All information and data referenced in this report are sourced exclusively from official documents statistical
reports and financial statements of Loctek as well as internal data and publicly available information gathered Address：No. 436 Xueshi Road Shounan Subdistrict Yinzhou
consolidated and audited across various functional departments and business units within the Company. Unless District Ningbo City Zhejiang Province China
otherwise specified all financial figures are presented in Renminbi (RMB). In cases of discrepancies in financial
figures between this report and the annual report the latter shall prevail.
1 2Sustainability Report 2025
Message from the Chairman Lane Shaw
Founder & Chairman of Loctek
In 2025 the global economy faced multiple pressures from trade frictions geopolitical conflicts
and growth divergence. Leveraging its strong resilience and growth potential Loctek delivered
steady revenue growth. These impressive results are the product of our consistent and solid
efforts. We remain customer-centric align with the evolving trends of the times adhere to long-
termism and focus on long-term strategic planning. While continuing to deepen our presence
in the smart home sector we have steadily advanced the construction of our self-built overseas
warehouses. This report comprehensively and objectively presents the Company's practices
and achievements in environmental social and governance aspects and also embodies our
unwavering commitment and relentless pursuit of sustainable development.Focus on Core Business and Actively Return Value to Shareholders Put People First and Support Employee Development
The company adheres to its core business of smart home emphasizes R&D and innovation and upholds the strategy of The Company upholds the core values of "strive for excellence and innovation" and always attaches great importance to
developing independent brands. It mainly promotes the "LOCTECK" brand in the domestic market and the "FlexiSpot" brand employees' sense of gain and happiness. It provides a competitive compensation system and implements equity and option
in overseas markets establishing comprehensive sales channels covering domestic and overseas markets online and offline. incentives effectively attracting and retaining core talents and outstanding professionals. Through regular employee training
The Company has always taken it as its mission to create long-term stable and sustainably growing value returns. Capitalizing programs the Company helps employees to grow and achieve their career development goals.The Company has established
on the industry trends in recent years where overseas warehouses have been upgraded to core supply chain hubs and a comprehensive welfare and security system covering employees' daily necessities housing transportation and recreational
China's cross-border e-commerce has maintained steady and robust growth the Company has achieved the deep integrated activities and carefully cares for the well-being of all employees and overseas-based staff enabling all employees to share
development of cross-border e-commerce and overseas warehouse businesses.Over the past three years the Company has the fruits of the company's development. At the same time the Company actively fulfills its social responsibilities integrates
achieved a compound annual growth rate (CAGR) of 19.84% in revenue with cumulative dividends exceeding RMB 300 million corporate development with addressing social employment issues and extensively recruits university graduates with a total
accounting for 80.53% of the Company's average profit over the same period. The Company carefully listens to the demands of of 88 campus recruits in 2025.Along with the company's global development we have built an inclusive and diverse corporate
various stakeholders and continuously strengthens communication with investors. The controlling shareowner has voluntarily culture and practiced the corporate spirit of "Happy Creating Happy Living Happy Singing".increased holdings of the Company's shares twice conveying firm confidence in the Company's long-term development.Charitable and Public Welfare Activities: Practice Business for Good
Improve Governance and Uphold Integrity and Standardized Operations The Company has deeply integrated charitable and public welfare activities into its corporate development strategy and actively
The Company continues to deepen standardized governance and continuously enhance governance transparency and practices business for good. It has successively established scholarships and teaching awards at multiple universities and
credibility having been awarded Grade A in the Shenzhen Stock Exchange (SZSE) Information Disclosure Assessment for three colleges and continuously carried out paired student assistance programs to support the development of education. Actively
consecutive years. Simultaneously the Company strengthens risk control and compliance construction and comprehensively responding to the national call for comprehensively advancing rural revitalization the Company has adopted various measures
improves the risk management and internal control system. It has always abided by the principles of honest operation strictly to support rural development. The video channel "Loctek Chairman Shaw Speaks" continuously shares business insights and
observed business ethics and improved the integrity risk prevention and control mechanism. The Company effectively management cases providing experience and references for cross-border e-commerce practitioners and entrepreneurs. In the
protects customer information security achieving zero incidents of customer data security breaches. With a modern efficient process of participating in the Belt and Road Initiative and expanding overseas the Company actively fulfills its overseas social
and transparent governance structure the Company consolidates the foundation of corporate governance providing strong responsibilities respects local cultures integrates into local communities creates economic and social value for local areas
support for the long-term healthy development and sustainable value creation of the enterprise. and promotes common development of all parties.Practice Green Development and Protect the Ecological Environment Faced with the complex and volatile external environment Loctek has always integrated ESG concepts into its corporate
strategy and daily operations. Adhering to innovation as the driving force and green development as the foundation the
The company adheres to the environmental philosophy of "green and low-carbon energy conservation first efficiency- Company balances economic benefits environmental responsibilities and social responsibilities and strives to achieve
oriented and full participation". It has incorporated climate change risks into its risk management framework to standardize coordinated progress between corporate development and social value. Looking ahead we will continue to deepen our
climate governance. Actively responding to the carbon peaking and carbon neutrality goals the Company integrates green commitment to sustainable development actively carry out industry exchanges and cooperation and work with all parties
management throughout the entire product life cycle conducts carbon footprint accounting and has built an ecological factory to promote the steady progress of the industry. We will always adhere to the customer-first philosophy and create value for
featuring "rooftop power generation fish farming with wastewater birds singing and flowers blooming and fruits and melons customers with high-quality products and services. Amid the tide of the times we will move forward steadily step by step
fragrant".By upgrading technologies and equipment and advancing digitalization the Company promotes energy conservation closely focus on high-quality development take solid actions to advance sustainable development and create a better future
and emission reduction lowers energy consumption and improves energy utilization efficiency. It has been awarded the through hard work.titles of "National Green Factory" and "Zhejiang Province Water-Saving Enterprise". From increasing the proportion of green
products using more renewable energy to comprehensively implementing green office practices the Company has integrated
the concept of green development into every aspect of daily operations making low-carbon development a common code of
conduct for all employees.
3 4Sustainability Report 2025
About Us
Company Profile
Corporate Culture
Development History
2025 Milestones
5 6Sustainability Report 2025
Company Profile Corporate Culture
Vision Mission
Founded in 2002 and headquartered in Ningbo Zhejiang Province Loctek has grown
into a dual-engine enterprise driven by both Smart Home and Cross-border third-party
logistics Today the Company stands as an innovation-driven platform-based benchmark
in China's cross-border e-commerce sector.To evolve into a ness
First Cust
forward-thinking Fair omer User-
enterprise Cen Satisfaction
that meets tri Customer
societal needs Satisfaction
On December 1 2017 Loctek was listed on the SZSE ChiNext Market (stock code: 300729) becoming the first A-share by leveraging Mission
listed company in the ergonomic wellness industry and the first cross-border e-commerce company to go public technology and User Satisfaction，Customer Satisfactionthrough an IPO in China. innovation.Loctek is deeply rooted in the ergonomic wellness space. Centered on its core expertise in intelligent lifting technology
the Company continues to expand innovative applications across smart office and smart home environments. Our main Vision
product lines include standing desks ergonomic chairs sit-stand desk converters motion sofas and smart electric To evolve into a forward-think-ing enterprise that meets soci-
beds. Loctek’s products are now available in 75 countries and regions around the world. etal needs by leveraging tech-
nology and innovation
As of the end of 2025 the Company has deployed 20 public overseas warehouses globally with a total warehouse area
of 672300 square meters. It provides innovative one-stop full-process cross-border logistics services for foreign trade Happy Creating Happy Living
Happy Singing
enterprises including first-leg ocean shipping one-piece fulfillment FBA transshipment overseas warehousing after-
sales management and independent website distribution. The Company has cumulatively served more than 2000 Spirit Happy
enterprises supporting Chinese brands in going global. Strive Creating
& Happy
Loctek has always kept corporate social responsibility firmly in mind adhering to legal operation integrity-based Innovation Living Happy
business and tax payment in accordance with the law. Over the years guided by the charitable philosophy of "never Singing
forgetting its roots and contributing to its hometown" it has made continuous contributions to charitable causes. Since
2006 Loctek has established scholarships at Ningbo University University of Nottingham Ningbo China and other
educational institutions benefiting more than 2500 teachers and students cumulatively. In 2022 the Loctek Leshan
Charitable Fund increased its capital to RMB 40 million contributing Loctek's strength to supporting education helping
the needy caring for the elderly and assisting people with disabilities!
Loctek advocates the corporate spirit of "Happy Creating Happy Living Happy Singing" actively practices the concept Core Values Spirit
of common prosperity and enables all employees to share the fruits of the company's development.
78
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Strive icie
c nt
InnovationSustainability Report 2025
2022
FlexiSpot ranked among Kantar
Development History BrandZ Top 50 Chinese Global Brand Builders.
2016 Loctek held the groundbreaking cere-
mony for its new headquarters build-
FlexiSpot.com Loctek’s first inde- ing.pendent e-commerce site went live
in the U.S.
200220092023
Loctek’s predecessor Logitek The CCTV program The Pillars of Chi-
Standard Electronics Cable Man- The second manufacturing base na exclusively sponsored by Loctek
ufacturing Co. Ltd. was founded. opened in Ningbo Yinzhou Eco- officially premiered.nomic Development Zone; “Loctek” 2017
brand was officially launched. Loctek’s 1800 TEU container vessel
Loctek was listed on the SZSE was successfully delivered.ChiNext Market (stock code: 300729).Guangxi Manufacturing Base began
operations.
20042011
Loctek shifted its focus to
The first manufacturing base cross-border e-commerce.was established in Jiangshan
Science & Technology Park
Ningbo.
2019
Loctek launched the smart study 2024
desk the first to feature electric lifting
technology in its category. Loctek launched 4Supply.com a
2013 professional B2B distribution plat-form establishing a presence in the
Loctek established its subsidi- cross-border distribution sector;
ary in Silicon Valley USA; the first Construction began on Loctek’s first
cross-border warehouse began op- 2020 1000000 ft self-built cross-border
erations marking the start of global Loctek invested over USD 100 mil- warehouse in Ellabell Georgia USA.expansion. lion in a comprehensive cross-border The headquarters building was offi-
third-party logistics innovation com- cially put into use.
2005 plex.
Loctek released its first ergonomic Loctek Smart Wellness Research In-
monitor arm. 2015 stitute was established.Vietnam manufacturing base was
launched; 2025
2008 Loctek released its first smart stand- 2021 Loctek commences construction of its self-built warehouse in Apple Val-
Loctek was recognized as a National ing desk and pneumatic sit-stand
High-Tech Enterprise. desk converter. The Smart Wellness Industrial Park
ley California;
project was launched in Beihai First self-built warehouse (Ellabell
Guangxi. Warehouse) completes construction;
Loctek introduced its first smart elec- Loctek expands into US offline distri-
tric bed. bution channels and initially estab-
lishes an offline brand matrix.
9 10Sustainability Report 2025
2025 Milestones
Guangxi R&D Branch Center Lecangs successfully integrated July Lecangs officially launched the January officially established to with the TikTok Shop platform to European first-leg LCL service
strengthen regional R&D develop new traffic channels for Expand Network and Extend further enhancing its global R&D Frontloading and New
Channel Development collaboration; social e-commerce. Services
cross-border logistics solutions.February 4Supply B2B distribution The Company won the Yinzhou Dis- FlexiSpot launched a one-year tram platform featured in a re- trict "Dali Ding Award" for the third
Business Model Gains port by Zhejiang Satellite consecutive year with its compre- August
advertising campaign in key Ger-
man cities including Munich and
Recognition and Core TV's Xinwen Lianbo; hensive strength once again af-
Strengths Earn Accolades firmed by the local government. Deepen Brand Building and
Hamburg continuously deepening
Localize Operations its local brand building in Europe.The Company advanced joint re-
cruitment of postdoctoral research-
ers with multiple universities and
The international marketing successfully held the inaugural
team conducted in-depth Loctek–University of Nottingham
market research and ex- The Company held the annual VIP
March Innovation Design Competition pansion across global mar- customer appreciation banquet for September connecting cutting-edge academic
Expand into New Territo- kets; organized 33 batches cross-border third-party logistics Industry-Academia Integra- achievements with industrial inno-
ries and Deepen Cooper- of customer visits reaching business to consolidate core part- tion Empower Innovation vation resources.ation nearly 400 customers; nership relationships.October The intelligent warehouse allocation New overseas products won system for cross-border third-party
Innovative Design System Gold and Bronze Awards in the logistics was launched optimizing
April The Company success- Lecangs was ranked among the fully hosted the Loctek Empowerment American Good Design Awards. the global supply chain.“Top 10 Benchmark Enterprises” on
Lead the Industry and Cross-Border E-Commerce the Xiaosheng Ranking and its in-
Gain Strength Recogni- Summit and released in- dustry-leading position has been
tion dustry insights; widely recognized.November The Company maintained its By partnering with the largest local
Defend Domestic Leading No. 1 online sales ranking in the tech forum in the Netherlands the
The Company was award- FlexiSpot Lotus Sofa Position Expand Global In- category during the Double 11 brand achieved high-efficiency ex-ed the title of “Nation- won the MUSE De- fluence shopping festival. posure and business conversion.al 5G Factory” marking a sign Awards Gold
May new height in its intelligent Award (USA) affirm-
manufacturing capabilities; ing its design innova-
Intelligent Manufactur- tion capabilities with
ing Advances and Brand this top international
Shines Brightly accolade. Loctek held a commercial channel
conference opening a new chapter
in the commercial market of healthy
office solutions.June Launched integrated on- The Company was selected for Ning-line and offline marketing bo City’s “Talent Gazelle Enterprise” December The first self-built overseas ware-Gather Marketing Strength campaigns around the “618 list with its innovation and talent The annual output value of the house Ellabell Warehouse (Georgiaand Gain Talent Recogni- Shopping Festival” to con- growth potential recognized. Channel Expansion & Infra- Vietnam manufacturing base No.1 Logistics Park) has been com-
tion solidate market leadership; structure Completion exceeded RMB 500 million; pleted.
11 12Sustainability Report 2025
Overview of 2025
Outstanding
Achievements
2025 Honor Highlights Gallery
Key Performance
13 14Sustainability Report 2025
2025 Honor Highlights Gallery
Government Honors Overseas Brand Honors
Zhejiang Provincial Third Batch Eagle Enter- 2025 Zhejiang Private Multinational Enterprise
prise “Pioneer Enterprise” The Lotus Sofa won the Gold Award at the 2025 MUSE Design Awards.
2025 Zhejiang Private Economy Headquarters “Contract-Abiding and Credit-Reliable” Enterprise The BF60 Japanese Mortise-and-Tenon Bed won the Gold Award of the 2025 American
Leading Enterprise Ningbo Key Open Source Project Cultivation Da- Good Design Awards.
2025 Zhejiang Service Industry Leading Enter- tabase The C7Max Ergonomic Chair won the Bronze Award of the 2025 American Good Design
prise Ningbo Outstanding Enterprise for Safe Develop- United Awards.
2025 Zhejiang Provincial First Set of Major ment States The Sheer Ergonomic Chair won the Silver Award at the 2025 New York Product Design Technical Equipment Listed on Ningbo “Talent Gazelle Enterprise” Awards.
Zhejiang Digital Culture Gradient Cultivation Ranking
Enterprise The C7 Morpher Ergonomic Chair won the Gold Award of the 2025 International Design
Awards (IDA).The E7Plus Max Height-Adjustable Desk received the Honorable Mention of the 2025 Inter-
national Design Awards (IDA).Government Rankings & Listings Scientific and Technological Innovation Honors
9 Honored with the 2025 German Brand Award.th Top 10 Private Enterprises in Cross-border Operation Ningbo Second Prize of Ningbo Municipal
16 Top 100 Growth Enterprises Zhejiang Science and Technology Progress th Received the 2025 IGR Ergonomics Innovation Award.Province Award
19 Top 100 Competitive Enterprises 2025 Batch 2 Guangxi “AI + Manufac-th Won the 2025 German Service Award (Ergonomic Solutions Category).Ningbo turing” Certified Products
21th Top 50 Enterprises in R&D Investment 2025 Advanced-level Smart Factory Awarded the German Design Award 2026.Ningbo 2025 Zhejiang Provincial First Set of
27th “Pioneer Enterprise” of Zhejiang Equipment — E5 Posture-Sensing In- Received the Computer Bild Trend Store of the Year 2026.Private Multinational Enterprises telligent Lifting Healthy Office Equip- Germany
48 Top 100 Manufacturing Enterprises ment (Consumer Goods Equipment)th Obtained the Climate Protection Partner Certificate.Ningbo
86 Top 100 Comprehensive Enterprises th Ningbo The E9 Height-Adjustable Desk was nominated for the 2025 German Innovation Award.
The E7 Plus Height-Adjustable Desk obtained IGR Ergonomics Certification.The C7Air Pro Ergonomic Chair passed the evaluation and certification by Germany’s CHIP
Lecangs · Qualifications & Honors Magazine.United Honored with the 2025 UK Business Awards.Qualifi- Provincial Public Overseas Warehouse Designated connected warehouse of TikTok (2021–2024) Shop Kingdom Granted Indy/Best Recommended of the Year certification by The Independent UK (2025).cations
The E7H Height-Adjustable Desk was named Best Buy Height-Adjustable Desk of the Year
by Japan’s Home Appliance Review Magazine.Top 10 Benchmark Overseas Warehouse Top 10 Overseas Warehouse Enterprises in Chi-
Enterprises Xiaosheng Ranking 2025 na Cross-border E-commerce Logistics 2025 Japan The E7H Height-Adjustable Desk was selected as March Star Recommended Product by
Honors Japan’s Poco’ce Magazine.Leading Enterprise Going Global in China Ecological Partner of the Year 2025 Xiamen
Cross-border E-commerce Logistics 2025 Cross-border E-commerce Association The E7H Height-Adjustable Desk was recommended as May’s Featured Product by Japan’s
PC Watch media.
15 16Sustainability Report 2025
Key Performance
Economic Performance Environmental Performance
Operating revenue Total assets
Environmental protection Total energy consumption Energy consumption intensity
investments
RMB 6 . 7 1 5 billion RMB 1 0 . 2 5 billion
RMB 2.2987 million 8081.76 tce 1.20 tce/RMB million (revenue)
Total profit Net profit attributable to shareholders of the parent company
RMB 0 . 3 1 4 billion RMB 0 . 2 5 9 billion Total direct energy consumption Including: natural gas consumption
4216.28 tce 2.7189 million Nm3
Governance Performance
Total diesel consumption Total liquefied petroleum gas Total indirect energy consumption
consumption
11.86 tons 340 tons 3865.48 tce
Number of shareholders’ meetings Number of meetings of the Board of
convened Directors convened
2 13 Total purchased electricity Green power purchase Photovoltaic power generation
20151771 kWh 9655213 kWh 1645285 kWh
Social Performance Total water consumption Total waste gas emissions Total wastewater discharges
253677 tons 65235.13 tons 84561 tons
R&D investments Investment as Percentage of Number of R&D personnel
Operating Revenue
RMB 2 1 3 . 1 7 3 4 million 3.17% 964 Non-hazardous waste discharged Hazardous waste discharged Total GHG emissions (Scope 1 + 2)
2154.04 tons 229.55 tons 17612.91 tCO2e
R&D personnel as a percentage Total number of patents granted Total number of trademarks
of total workforce
24.26 1269 922 GHG emissions intensity (Scope 1 + 2) Direct GHG emissions (Scope 1)%
2.62 tCO2e/ RMB million (revenue) 6920.38 tCO2e
Total number of employees Tax payment Total charitable donations
3974 156.8799 2.118 Indirect GHG emissions (Scope 2) Reduced carbon emissionsRMB million RMB million
10692.53 tCO2e 9277.71 tCO2e
17 18Sustainability Report 2025
Sustainability Governance
Company Actions
Sustainability Governance Framework
Sustainability Strategy
Management of Sustainability-related Risks and Opportunities
Sustainability Metrics and Targets
Stakeholder Engagement
Materiality Assessment
19 20Sustainability Report 2025
Sustainability Governance Framework
ESG Rating Performance and Honor Recognition
To effectively advance sustainable development initiatives the Company has established a robust ESG management Through systematic and efficient sustainable development management Loctek has achieved substantial progress in
framework and institutional system and built a sound sustainable development governance structure. In the course of its environmental social and governance performance. During the reporting period the Company recorded a notable
strategy implementation risk management and major decision-making the Company fully takes into account ESG-re- improvement in all ESG-related ratings.lated impacts risks and opportunities. The Company has formulated a scientific ESG indicator system covering but
not limited to carbon emissions technological innovation and employee rights and interests. It also links ESG perfor-
mance to management personnel’s performance appraisal ensuring the effective execution of all relevant strategies
and measures. Sustainable Development-related Ratings:
Hierarchy Personnel Composition Scope of Responsibilities
Rating Category 2023 Rating Result 2024 Rating Result 2025 Rating Result
To understand analyze and keep abreast of domestic and international industry dynamics
as well as policies related to sustainable development and grasp the overall operation
Deci- and management of the Company; to oversee the assessment of the Company’s sus-
sion-mak- Members of the tainable development-related impacts risks and opportunities; to guide and review the
ing Board of Directors Company’s sustainable development policies strategies and goals; to regularly monitor the progress and completion of sustainable development targets; to approve the issuance Wind ESG Rating A A AA
of the Company’s Sustainable Development Report; to supervise and inspect the imple-
mentation of sustainable development work and provide guidance in a timely manner.Senior manage- To manage material ESG issues provide professional analysis and recommendations
ment and depart- and support the Board in fulfilling its supervisory duties; to coordinate the identification Yidong ESG+8 AA AA AA
Manage- ment heads with mitigation and monitoring of sustainable development-related impacts risks and oppor-
ment professional knowl- tunities rationally allocate relevant costs and resources formulate work plans for sustain-
edge of sustainable able development and optimize the incentive and performance assessment systems for
development sustainable development.Huazheng ESG Rating A A A
Members of the To formulate stakeholder engagement plans and organize stakeholder communication
ESG Implementa- activities; to coordinate the compilation of the Sustainable Development Report; to build
Execution tion Team and rel- the Company’s capabilities in sustainable development management data statistics and
evant work princi- analysis as well as communication with investors and research institutions; to improve
pals supporting management systems for sustainable development and implement relevant work plans; to regularly report work progress and outcomes to management.Sustainable Development Honors:
ESG Advocacy & Training
The Company regularly invites professionals to conduct ESG-related training practices ESG philosophies with tangible
actions and promotes the sustainable development of the enterprise. During the reporting period the Company invit-
ed professional institutions twice to interpret ESG policies and industry best practices. It also participated twice in train-
ing courses and ESG rule seminars themed ESG and Sustainable Development which were organized by regulatory au-
thorities industry associations and social organizations.Case ESG Training Boosts the Company’s ESG Implementation Progress
In December the Company specially invited a professional institution
to deliver a special ESG awareness and training session for
management staff across all departments. The training covered the
significance of ESG initiatives interpretation of the latest relevant
policies sharing of industry best practices as well as the division of
responsibilities and specific arrangements for internal ESG work. The 2025 China’s Top 100 Listed China Securities Value Online 2025 Best ESG
session aims to ensure the smooth progress of ESG data collection Companies in ESG Best Practices Journal ESG Golden Practice Award for Listed
ESG report compilation and other related tasks. (Small and Mid-Cap) - AA Rating Bull Award – Top 100 Companies
Special ESG Training
21 22Sustainability Report 2025
Management of Sustainability-
Sustainability Strategy related Risks and Opportunities
The Company has defined development goals guided by ESG principles. It comprehensively sorted out business pro- The Company integrates the ESG philosophy into its risk management and decision-making system and optimizes the
cesses from the three dimensions of corporate governance environment and society conducted in-depth analysis of Procedures for Identification Assessment and Control of Operational Risks. It comprehensively identifies assesses and
potential risks and integrated the concept of sustainable development into strategic decision-making and daily oper- analyzes internal and external factors covering climate change supply chain management innovation and R&D prod-
ations. On this basis rooted in its corporate social responsibility philosophy the Company builds a distinctive and fu- uct quality employee rights and interests and other aspects. Targeted risk prevention and control measures for sustain-
ture-oriented sustainable development system by comprehensively evaluating its economic environmental and social able development are formulated accordingly to drive the stable development of the Company.impacts providing clear direction and guidance for its long-term sustainable growth.Establish an ESG risk database focusing on key fields and material sustainable de-
Dimension Topic Key Risks / Opportunities Corresponding Chapter velopment topics；of Countermeasures
Compliance and Compliance management risks; Integrity & Compliance Governance Risk Control for Sustainable Adopt scenario analysis risk matrix and other methodologies to evaluate multiple Operational opportunities and market opportunities. Governance prospective development scenarios so as to effectively identify and assess rele-
vant risks；
Policy and legal risks qualified emission risks;
Environmental Improving
Protection Environmental Opportunities from integration of intelligence and Conduct multi-channel communication with the Company’s stakeholders to deter-
green technologies. Management mine the grading of ESG risks；
Physical risks transition risks;
Environment Climate Change Addressing Climate
Opportunities for technology and material innovation. Change Climate Action
Formulate targeted proposals for the Company to address ESG risks at the current
and subsequent development stages based on risk grading results；
Physical risks policy risks technical risks;
Resource Utilization Reducing Resource
Opportunities for technological progress and resource Consumption The Strategy and Sustainable Development Committee of the Board of Directors
efficiency. reviews and confirms the ESG risk assessment results and response proposals
and integrates the management of sustainable development risks and opportuni-
ties into the Company’s corporate strategy.Product Quality Legal risks market risks equipment and process risks; Product Quality
Control Assurance Premium Market opportunities and technological opportunities. Services
Price fluctuation risks supply chain disruption risks;
Sustainable Supply Sustainable Supply
Chain Opportunities for diversified supply and supply chain Chain
digital transformation.Social
Occupational Health Legal risks operational risks; Safeguarding Health
and Safety Management efficiency opportunities. and Safety
Employee Rights Legal risks operational risks; People-oriented
and Interests Approach for All-
Protection Management efficiency opportunities. round Employee Development
2324
Management Process of Sustainable
Development Risks and OpportunitiesSustainability Report 2025
Sustainability Metrics and Targets
The Company attaches great importance to long-term sustainable development and actively responds to the national
strategy of Healthy China 2030. It integrates the Environmental Social and Governance (ESG) system centered on Strategic United Nations Sustain-Targets & Commitments able Development Goals Company Actions in 2025
environmental protection and social responsibility into its corporate development strategy. The Company continuously Pillar (SDGs)
improves its ESG strategy framework and sets specific targets at all levels ensuring full alignment with the United
Nations 2030 Sustainable Development Goals (SDGs). Meanwhile the Company optimizes the ESG management The total R&D investment amounted
system reduces environmental impacts boosts the research and development of high-quality products protects to RMB 213.1734 million;
employees’ rights and interests cultivates outstanding talents and contributes to the harmonious development of Promote innovation and R&D for green sustainable products; Strengthen the construction of pro-
society. fessional teams and tackle a number
of technical bottlenecks in the indus-
United Nations Sustain- Implement incentive mechanisms try;
Strategic Pillar Targets & Commitments able Development Goals Company Actions in 2025 for R&D projects product innova-
(SDGs) tion patents and talent develop- Exercise strict control over produc-
ment; tion processes to improve product quality;
Enhance customer service systems Continuously optimize service work-
to deliver a high-quality responsive flows and provide high-quality prod-
Strengthen board independence Continuously improve vari- experience; ucts with the customer satisfaction
and diversity to enhance govern- ous rules and regulations fur- Customer rate reaching 95%;
ance structure; ther advance the development Satisfaction Ensure zero incidents of customer Maintain zero leakage of customer
of the compliance system and data breaches; privacy and strictly protect informa-
Improve mechanisms for protect- enhance corporate governance tion security;
ing shareholder rights and ensure standards; Improve the supply chain man- Conduct in-depth supplier risk as-
transparent information disclosure; agement system by incorporating sessment select high-quality part-
Constantly optimize the inter- supplier ESG risks as a part of risk ners and establ ish long-term
Corporate Formulate maintain and update nal supervision system and dis- identification prevention and con- cooperation relations. Multiple meas-
Governance the Articles of Association man- close relevant information to trol; ures are implemented to consolidate
agement systems rules of proce- the public via high-quality in- the supply chain security defense
dure and operational guidelines; formation disclosure; line and ensure stable supply;collaboration for long-term sus-
tainable development. During the reporting period the
Optimize ethical business prac- Conduct regular anti-corrup- Company participated in the drafting
tices with a focus on cultivating tion training to strengthen em- of a number of national and industri-
employee awareness of business ployees’ anti-corruption aware- al standards.ethics. ness.Ensure equal opportunities in re- Ensure open and transparent recruit-
cruitment promotion and career ment improve the career develop-ment system and empower employ-
development; create a diverse ees’ personal growth;
flexible and inclusive workplace
that supports employee growth; Optimize the work safety manage-
ment system build a safe working
Proactively reduce carbon emis- During the reporting period the Establish a safe and healthy work- environment and protect employees
sions deploy energy-saving equip- total greenhouse gas emissions place target zero workplace at work;
ment and support the achievement amounted to 17612.91 tonnes accidents promote employee well-
of the national goals of carbon of CO? equivalent and the re- Improve the employee welfare sys-being and strive for 100% employ-
peaking and carbon neutrality; duced volume of greenhouse Social tem raise employee satisfaction and ee satisfaction;
gas emissions reached 9277.71 enhance team cohesion;Responsibility
Green Improve energy utilization efficien- tonnes of CO? equivalent; Actively support the national Engage in public welfare and provide
development cy raise the proportion of clean “shared prosperity” goal uphold a financial support for impoverished
energy use and conserve water The consumption of renewable philosophy of gratitude and giving students;
resources; energy stood at 1388.83 tonnes back and commit to public welfare
of standard coal equivalent; Carry out consumption assistance in-through sustained philanthropic in- itiatives to inject vitality into rural re-
Strictly control waste discharge and itiatives. vitalization;
steadily reduce pollutant emissions. Cut down pollutant emissions
and alleviate environmental pol- Participate in the Belt and Road Initi-
lution. ative and provide stable employment
opportunities.
25 26Sustainability Report 2025
Stakeholder Engagement
The Company is committed to establishing a robust and diversified stakeholder communication framework. By accurately identifying and responding to the ESG concerns of key stakeholder groups—including shareholders and investors customers employ-
ees suppliers communities government and regulatory authorities media and professional organizations—the Company continuously evaluates both risks and opportunities to refine and strengthen its ESG strategy.Stakeholder
Group
Shareholders & Investors Government &Regulatory Agencies Customers Employees Suppliers & Partners Communities Public and Media Professional Organizations
Sound compliance Drive common prosperity Product and service quality Protection of labor rights Expand cooperation Economic performance Technological innovation
and interests channels
Operational risk Compliance with laws and Product safety and reliability Public welfare and charity
management regulations Employee care Fair and impartial Industry advancement and
Product R&D and innovation procurement development
Tax compliance Responsible and compliant
Expectations Information disclosure Enhance product cost- Remuneration and operationsand transparency
and Concerns Risk and compliance
benefits Win-win collaboration
management effectiveness Dedicate to education support
Sustainable returns on Employee growth and Regulatory and ethical
investment Regional economic Information security and training compliance Promotion of social
development privacy protection development
Occupational health and Supply chain sustainability
Environmental protection Intellectual property safety Green and low-Carbon
protection protection
Shareholders’ meetings Participate in industry Client visit Employee representative Contract execution Company website Industry forums
policy formulation assemblies
Periodic reports Customer satisfaction Supplier conferences Media interviews and Trade fairs and exhibitionsPolicy briefings and surveys Employee satisfaction
Earnings briefings updates surveys Supplier visits press releases Sector-specific conferences
Customer service Performance evaluation and dialogues
Ongoing investor Meetings and exchanges platforms and feedback Supplier management Charitable events
Communica- engagement mechanisms and training
tion Channels Policy advisory
Information disclosure engagement
Reception and tour
Employee activities
Investor support lines On-site inspections and Employees interviews Green production and
visits operation
Training programs and
employee handbook
27 28Sustainability Report 2025
Materiality Assessment Materiality Assessment Results
Conduct analysis of material topics based on “impact materiality” and “financial materiality” and produce the materiality
matrix.In alignment with Guidelines No. 17 of Shenzhen Stock Exchange for Self-Regulation of Listed Companies – Sustainability
Report (Trial) and international standards such as GRI 3: Material Topics the Company follows the principles of
materiality completeness and balance to identify and prioritize ESG topics. This process incorporates both impact
materiality and financial materiality supporting the development of a focused ESG strategy that reflects the Company’s Both financially and
most significant sustainability risks and opportunities. The following table presents the specific steps of assessment: impact material
15
120
3611
192
Macro-Environmental Analysis of China’s Industrial Development Trends 8 Financially material
Based on Global Megatrends; 13 17
9 but not impact ma-16 5
Step 1: Analyze the company’s industry landscape; terial
Background Analysis
Assess the company’s business model; 414 7 10
Identify and analyze the impacts risks and opportunities the Company and Environmentally ma-18
its stakeholders currently face. 21 terial but not finan-12 cially material
Develop a pool of material ESG topics by drawing upon assessment
Step 2: Neither financially methodologies from global standards such as the GRI SDGs SASB and
List of Material Topics nor materiallyMSCI along with best practices from industry peers.High Financial Materiality Extremely high
Sustainability
Environmental Social Governance
Impact Materiality Assessment：
Gather stakeholder insights through surveys interviews and other
engagement methods to evaluate the potential environmental social and
economic impacts of each topic.Step 3: Financial Materiality Assessment：
Materiality Assessment Analyze the results of the survey focusing on the impact dependencies 1 Response to climate change 9 Rural revitalization 18 Due diligence
and other relevant factors; and integrate expert judgment and surveys 2 Pollutant discharge 10 Social contributions 19 Stakeholder engagement
from all functional departments on the likelihood of each issue and
severity of financial impact to identify and evaluate the risks and 3 Waste management 11 Innovation-driven develop- 20 Anti-bribery and anti-cor-
opportunities associated with each issue ultimately determining which ment ruption
issues hold financial materiality. 4 Ecosystem and biodiversity preservation 12 Ethics in science and tech-nology 21 Anti-unfair competition
5 Environmental compliance 13 Supply chain security
6 Energy use 14 Equal treatment of SMEs
7 Water resources utilization 15 Product and service safety and quality
8 Circular economy 16 Data security and privacy protection
Step 4: Compile a final list of material topics distinguishing those based on impact 17 Employees
Topic Confirmation and financial materiality and ensuring that all relevant issues are presented
in a transparent balanced and comprehensive manner Medium. Note: 1. “Irrelevant” refers to topics that are neither financially material nor impact material; 2. “Double materiality” refers to topics that are both
financially and impact material; 3. The exchange guidelines specify that “Ecosystem and Biodiversity Protection” is only applicable to specific
entities. This topic is currently not relevant to the Company.
2930
Extremely high Impact MaterialitySustainability Report 2025
Special Topic: ESG Practices Lecangs deeply embed the ESG philosophy into daily operations. Focusing on the goal of full-chain green operation in the logistics and warehousing industry we take five dimensions including planning & design facilities & equipment
operation management transportation & distribution and resource recycling. We drive green logistics through
of Lecangs technological innovation boost cross-border trade with ecological co-prosperity and solidify the foundation of development via compliant governance. We keep cutting operational energy consumption accelerate the efficient
and green transformation of cross-border logistics and forge a sustainable development path that balances economic
benefits and social value.Environmental (E)： Medium & Large Cargo Goods-to-Person Picking AGV Robot Robotic Arm Depalletizing Palletizing and Labeling Assembly Line
Technology Empowers Carbon Reduction to
Build an Efficient & Green Logistics System Specially engineered for bulky and heavy products the To address the pain points of high labor demand and low robot features a higher load-bearing capacity and is efficiency in labeling ultra-thin goods this assembly line
well adapted to the inbound and outbound workflows of realizes automatic depalletizing labeling checking and
Lecangs. It greatly cuts the walking distance of picking palletizing. It improves the efficiency and standardization
Scientific Planning and Design to Consolidate the Foundation of staff improves picking efficiency and accuracy and of labeling operations and has been granted a utility model
Low-carbon Operations elevates the overall operational efficiency of the entire patent.logistics system.Adhering to the green development philosophyLecangs reduce transportation distance through scientific site selection
and rational layout. Meanwhile we integrate full-link resources covering first-mile transportation warehousing and last-
mile delivery and optimize logistics routes with the support of information and automation technologies.Overseas Warehouses are Generally Located at：market transportation hubs and port-adjacent areas which
greatly shortens the distance of first-mile transportation and last-mile delivery. This fundamentally cuts down energy
consumption and carbon emissions in transportation links.At the end of 2025 Loctek’s first self-built overseas warehouse (Ellabell Warehouse) was completed. Covering an area
of approximately 1 million square feet the warehouse is only a half-hour drive from the Port of Savannah significantly
shortening the container haulage distance.Scientific Planning of In-Warehouse Areas：On the premise of
ensuring operational efficiency and strictly controlling safety risks Goods-to-Person Picking AGV Robot for Medium Robotic Arm Depalletizing Palletizing and
Lecangs effectively vitalize and optimize storage space through and Large Cargo Labeling Assembly Line
scientific planning of warehouse layout.We adopt zoned storage
based on cargo turnover frequency and install high-bay racks which
significantly boosts warehouse capacity without increasing the original Mobile DWS System for Medium and Large Cargo Automatic Sorting Line
warehouse area.Narrow-aisle racks are optimally deployed for the
handling of medium and large-sized goods working in coordination To solve the pain points of difficult movement and Against the backdrop of insufficient sorting capacity for
with side-loader forklifts. This improves space utilization and inconvenient information collection for medium and large large-sized cargo at downstream hubs the system adopts
operational accuracy reduces operational blind spots and lowers the cargoes the system adopts visual recognition technology visual recognition technology and flexible conveyor line
risk of equipment collision. Narrow-aisle side-loader forklift operating to realize integrated dimensioning weighing and scanning. technology to realize automatic sorting of extra-long
inside the warehouse The collected data can be transmitted to data systems and over-weight large goods. It completes outbound
such as ERP and WMS cutting staffing demand by 6 verification and sorting operations and improves
Reduce Equipment Energy Consumption and Improve Operational personnel per production line. warehouse fulfillment efficiency.The maximum daily order
Efficiency processing capacity exceeds 150000 pieces with a sorting accuracy rate of 99.9%.Full Adoption of Electric Forklifts to Cut Greenhouse Gas Emissions：Traditional fuel-powered forklifts emit large
amounts of exhaust gas and generate loud noise during operation exerting adverse impacts on the warehousing en-
vironment and employees’ health.Since 2023 Lecangs have gradually replaced traditional fuel forklifts with AGVs and
electric forklifts. At present fuel forklifts have been basically phased out across all Lecangs worldwide.More than 500
electric forklifts have substantially reduced air pollution inside warehouses cutting carbon dioxide emissions by hun-
dreds of tonnes annually.Independently Develop Intelligent Warehousing Equipment to Boost Operational Efficiency：Led by professors and
doctorsLecangs automation R&D team integrates internal research resources and external equipment supplier re-
sources.It has independently developed medium and large-sized goods-to-person picking AGV robots robotic arm de-
palletizing/palletizing and labeling assembly lines as well as mobile DWS systems for medium and large cargoes.These
devices have been put into actual warehousing operation effectively improving work efficiency while lowering energy
consumption and cargo damage rates. Automated Equipment - DWS System Automatic Sorting Line
31 32Sustainability Report 2025
Optimize Operations and Realize Energy Conservation via Self-operated Trucking Services：Centering on port container drayage and LTL consolidation Loctek’s in-house
Management fleet significantly cuts the empty running rate of trucks and fuel consumption. It helps customers build a closed-loop cross-border logistics system featuring zero container detention high timeliness and full process transparency.Independently Developed Smart Logistics Informatization Platform：Loctek has an in-house IT team of nearly
300 members that independently develops the overseas warehouse system. The system is capable of intelligent
information analysis data transparency resource integration and customized system configuration.It comprises the
Order Management System (OMS) Overseas Warehouse Management System (WMS) Transportation Management
System (TMS) and Billing & Settlement Management System (BMS) providing robust support for order surges during
peak business seasons. The self-developed TMS realizes visualized logistics optimized connection of end delivery and
trucking delivery services. The BMS supports automatic financial settlement. The system can also track the real-time
location of parcels transported and delivered by logistics providers including FedEx UPS and DHL enabling real-time
monitoring and improved refined management.Industry-leading digital twin technology has also been deployed in the warehousing system. Boasting high availability
high concurrency and a stable system architecture the information system of Lecangs underpins future business
expansion customer service upgrade and growing order throughput. Port Drayage Self-operated trucking services cover major ports
across North America
Promote the Implementation of Green Packaging：Lecangs adopts recyclable packaging materials and uses foldable
In 2025 Lecangs’s Smart Global Logistics & Supply Chain Management System launched the wear-resistant courier boxes and packaging bags that can be recycled by consumers for repeated use.warehouse allocation recommendation function helping sellers cut comprehensive logistics costs
through rational warehouse network layout. Sellers only need to input product dimensions and the
system can automatically calculate the combined cost of first-mile and last-mile logistics delivering the Social (S): Empower via Ecological Co-prosperity to Fuel
optimal inventory stocking solution driven by big data computing.High-Quality Development of Cross-Border Trade
Focusing on three major orientations of serving outbound enterprises advancing industrial upgrading and protecting
the rights and interests of all partiesLecangs builds an ecological community for cross-border logistics.Full-link Service Guarantee to Empower Chinese Brands
Going Global
Lecangs provides full-chain services including first-mile sea freight one-piece dropshipping FBA transshipment over-
seas warehousing and after-sales trusteeship. Covering core markets such as the United States the United Kingdom
Germany and Canada it has served over 2000 cross-border e-commerce enterprises — covering medium and large
product categories including furniture and fitness equipment. It continuously empowers Chinese brands to expand
globally and pursues shared growth and prosperity.Lecangs integrates the full-link logistics service network to offer customers one-stop services covering first-mile trans-
portation warehousing & distribution returns and exchanges as well as end-to-end full-link solutions spanning from
manufacturers to consumers for both B2B and B2C businesses.Warehouse Allocation Recommendation of Lecangs
Expand Logistics Links：Lecangs integrates full-chain resources of first-mile transportation warehousing and last-mile
delivery and optimizes logistics routes with information and automation technologies. We adopt an all-inclusive flat-
rate model for sea freight and trucking services and conduct in-depth cooperation with shipping lines to offer compet-
itive ocean freight prices.We have launched a premium consolidated shipping line which boasts three major strengths:
stable vessel schedules fast transit time and cost savings. The voyage from Ningbo Port to Los Angeles Port only takes
around 13 days with no container rolling. Combined with Loctek’s professional full-link services goods can be fully
End-to-End Global Supply Chain Solutions
stocked on warehouse shelves in approximately 18 days.
33 34Sustainability Report 2025
As of December 31 2025 Lecangs recorded an annual shipment volume of over 18 million. Its peak daily order Partnership Collaboration and Shared Prosperity
processing volume exceeds 150000 with the number of cargo SKUs topping 150000 and the 24-hour
outbound fulfillment timeliness rate stays above 99.9%.Lecangs has signed long-term cooperation agreements with platforms including FedEx and Amazon. It has ranked
Lecangs supports Amazon SFP Direct Shipping and other operational models helping sellers access FBA traffic among the world’s top 100 key clients of FedEx Ground since 2023 and advanced into the global TOP 50 of FedEx
advantages at lower costs. Ground in 2025 ensuring stable service delivery.Governance (G): Compliant & Steady Operation
Consolidating the Foundation of Sustainable
Development
Strengthen Risk Prevention and Control Enhance
Anti-Cyclical Resilience
Faced with market fluctuations Lecangs mitigates risks by adhering to compliant operation and implementing a
Last-mile Logistics Transportation strategic layout.Lecangs puts compliant operation and asset
Resource Sharing Empowering security as the top priority and adheres to the self-
Industrial Development built and self-operated model. All warehouses
and courier accounts are Self-built and high-risk
Lecangs advances industrial progress through experience fraudulent shipping accounts are strictly prohibited
sharing and resource collaboration. effectively avoiding risks such as cargo detention
heavy fines and legal liabilities. In terms of
Lecangs was invited to attend the 7th China Cross-border
warehouse site selection and construction Lecangs
E-commerce Logistics Conference sharing its experience
strictly verifies local mandatory qualifications
built on 15 years of in-depth industry dedication and 13
including fire safety and taxation inspects security
years of overseas warehouse operation and promoting the
systems through on-site investigations and rejects
standardization of cross-border logistics.Lecangs was invited to attend the 7th China Cross- sub-landlords and shell companies to ensure the
border E-commerce Logistics Conference. absolute safety of corporate assets and clients’
Joined forces with three major national-level think tanks to goods.launch the strategic guideline — Full-knowledge Navigation
Map of Cross-border E-commerce Logistics.Rooted in more Lecangs's resilience to fluctuations is rooted
than a decade of practical operational data in cross-border in its long-term strategic layout. Adopting a
logistics it precisely tackles 26 major core pain points offering rolling development strategy of upgrading from
a clear path for cross-border enterprises to reshape their small warehouses to large ones Loctek Group
logistics competitiveness. has reserved 5000 mu of industrial land in core
port areas of the United States in advance. Such
Lecangs actively participates in the development of industrial heavy asset investment brings remarkable cost
standards. It has taken part in formulating the Operational advantages — the operating cost of self-built
and Management Requirements for Cross-border E-commerce warehouses is only one-third to one-half that of
Overseas Warehouses issued by the State Administration for leased warehouses. Meanwhile Lecangs actively
Market Regulation and the Standardization Administration of expand last-mile logistics channels and establish
China so as to drive the standardized development of the in-depth cooperation with logistics giants such as
industry. In addition it clarifies operational standards and the FedEx. It secures more favorable discounts backed
division of responsibilities in key links such as goods storage by massive shipment volume further consolidating
sorting and distribution. its core competitiveness in the cross-border Lecangs Embodiment of Strategic Layout
Lecangs E-commerce Logistics Full- logistics sector.Knowledge Navigation Map
35 36Sustainability Report 2025
Protect Employees’ Rights and Interests Foster a Fair Employment Lecangs has been honored with multiple accolades including 2025 China Cross-border E-commerce Logistics
Atmosphere Leading Enterprise Going Global Top 10 Overseas Warehouse Enterprises of China Cross-border E-commerce Logistics 2025 Top 10 Benchmark Overseas Warehouse Enterprises in 2025 Xiaosheng Ranking and 2025 Ecological Partner
Lecangs attaches great importance to the rights and interests of local employees and builds a symbiotic system Award issued by Xiamen Cross-border E-commerce Association. These honors fully reflect the industry’s recognition of
featuring fairness and career growth. Lecangs’s service quality and customer satisfaction.Local employees at Lecangs (e.g. teams in the United States and Germany) (including teams in the United States
and Germany) are covered by social insurance in accordance with local laws. The Company has established a
comprehensive skills training system to enhance employees’ professional competencies and broaden their career
development prospects. It has also set up the Overseas Employee Care Fund to support needs such as medical care
and children’s education. Meanwhile complete living facilities including staff canteens and lounge areas are provided
to improve employee well-being. In addition the Company has formulated the Lecangs LLC Employee Handbook and
launched a cross-border compliance training mechanism with a focus on strengthening awareness of data security
trade compliance and other key areas.Top 10 Benchmark Overseas Top 10 Overseas Warehouse 2025 Leading Enterprise for 2025 Annual Ecological Partner
Warehouse Enterprises of 2025 Enterprises in China Cross-border Global Expansion in China Cross- Award of Xiamen Cross-border
Xiaosheng Ranking E-commerce Logistics 2025 border E-commerce Logistics E-commerce Association
Lecangs’s Staff Canteen Lecangs’s Employee Handbook
Lecangs has been selected as the 2025 Zhejiang Leading Enterprise in the Service Industry while Loctek Corp. has
Improve Customer Satisfaction been honored as the Zhejiang Leading Private Multinational Enterprise gaining authoritative recognition at the provin-
cial level.Lecangs upholds the core customer service philosophy of “Rooted in sellers serving sellers and understanding sellersbetter”. It has built a standardized customer service management system covering the full process of pre-sales in-
sales and after-sales. By delivering professional compliant and efficient services it empowers the growth of cross-
border e-commerce clients and fosters a stable win-win business ecosystem. With a sound institutional framework
and digital tools the Company enhances service efficiency and customer experience faithfully fulfills its service
commitments to clients and advances long-term symbiotic development with cross-border e-commerce partners. The
customer satisfaction rate of its service team exceeds 99%.Diversified Qualification Certifications Setting Industry Benchmarks
Lecangs has obtained a host of authoritative certifications relying on its outstanding services and compliant operation.Official recommended service provider of Amazon SPN officially certified docking warehouse of eBay certified
warehouse of TikTok Shop and officially certified warehouse of Temu.
2025 Zhejiang Provincial Leading 2025 Annual “Pioneer Enterprise” of Zhejiang
Enterprise in the Service Industry Private Multinational Enterprises
Lecangs’s ESG practices have not only enhanced its operational efficiency and risk resilience but also driven the
sustainable development of the industry with an open and shared mindset building a solid and green logistics
foundation for Chinese brands to go global.Moving forward Lecangs will continue to deepen its ESG strategy and join hands with partners across the industrial
chain to pursue a sustainable future together.TikTok Shop Certified Warehouse Lecangs’s Cross-border Platform Partner
37 38Sustainability Report 2025
Integrity and Compliance:
Strengthening Sustainable
Governance
Company Actions
Corporate Governance
Investor Relations Management
Compliance and Risk Control
Business Ethics and Anti-corruption
Information Security and Privacy Protection
SDGs
39 40Sustainability Report 2025
Corporate Governance Board of Directors
The Company establishes the Board of Directors in accordance
Loctek Corp. strictly complies with laws and regulations including the Company Law of the People’s Republic of Chi- with relevant laws regulations and normative documents acting
na (hereinafter referred to as the “Company Law”) the Securities Law of the People’s Republic of China (hereinafter re- as the operational decision-making body. It has formulated
ferred to as the “Securities Law”) the Code of Corporate Governance for Listed Companies and the Guidelines for the Ar- institutional documents such as the Rules of Procedure for the
ticles of Association of Listed Companies. It standardizes corporate operations establishing a governance structure with Board of Directors and the Independent Director System further
well-defined powers and responsibilities sound coordination and effective checks and balances. The Company contin- standardizing the deliberation and decision-making procedures
uously standardizes its operations and improves information disclosure and investor relations management and strives of the Board. This ensures that individual directors and the Board as a whole perform their duties diligently and compliantly
to elevate the corporate governance level and ensures the compliance and stability of business operations. continuously improving the standardization of the Board’s
operation and the quality of scientific decision-making.During
Loctek Ergonomic Technology Corp. the reporting period the Company’s Board of Directors faithfully
fulfilled its fiduciary responsibilities and successfully completed
the re-election of the Sixth Board of Directors. The current Board
is composed of Chairman Lane Shaw Directors Xiang Xin and
Zhu Wei Employee Representative Director Huang Xiaohong and
Shareholders’ Independent Directors Hao Yabin Chen Yiran and Hua Xiuping. It
Meeting provides decision-making support and supervisory safeguards for Re-election of the Board of Directors
the Company’s long-term value creation and risk management
with the Board discharging its duties in a standardized and
effective manner.Board of
Directors
The Company actively promotes diversity in the composition of the Board of Directors advances
gender equality and takes into account diversity in ethnicity geographical origin cultural
Board background and professional experience. This enables the Board to draw on a wide range of
Diversity perspectives and expertise in decision-making.Audit As of the end of the reporting period the Company’s Board of Directors has 7 members including Strategy and Sustainable Nomination Remuneration and
Committee 3 female directors accounting for 42.86%. The average tenure of Board members is 5.05 years and Development Committee Committee Assessment Committee the age standard deviation of directors and senior management is 10.56 years.In strict compliance with the requirements of the Company Law Securities Law and other relevant
laws and regulations as well as internal systems including the Working System for Independent
Management Board Directors on Annual Reports and the System for Special Meetings of Independent Directors the
Independence Company gives full play to the positive role of independent directors.Loctek’s Governance Structure During the reporting period the Board of Directors had three independent directors accounting for 42.86% of the total board members including one female independent director.Shareholders’ Meeting
Members of the Company’s Board of Directors have diverse professional backgrounds and extensive
The Shareholders’ Meeting is composed of all shareholders and serves as the Company’s supreme authority. All procedures experience in fields including physics electronic engineering business administration financial
governing the convening holding proposal submission voting and resolution adoption of the Shareholders’ Meeting are accounting and other disciplines ensuring that the Board’s decision-making fully covers all facets of
strictly implemented in accordance with the Company Law the Company’s Articles of Association and the Rules of Procedure Board the Company’s business operations.for Shareholders’ Meetings.The Company treats all shareholders equally and adopts a voting mode combining on-site and Professionalism Independent directors are well-versed in industry-related areas such as finance innovation strategy
online voting to facilitate shareholders’ attendance and right exercise and fully guarantees shareholders to exercise their and financial services. With profound professional and industrial experience they are able to provide
legitimate rights in accordance with laws.Professional external lawyers are appointed to witness the whole process of the professional opinions and recommendations to the Company.Shareholders’ Meeting on-site and issue legally valid legal opinions. During the reporting period no act that harms the
legitimate rights and interests of minority shareholders occurred in the Company. The Company regularly invites external professionals such as lawyers and securities practitioners
to deliver compliance training to directors and senior management so as to improve the decision-
making quality and compliance standard of the governance body.Key Performance Training for
Directors Directors and senior management are regularly arranged to attend qualification training organized
and Senior by relevant institutions.
2 18 Management The Company also organizes regular compliance training covering without limitation prohibition During the reporting period the Company held shareholders’ meetings at which proposals of insider trading protection of corporate confidential information and prevention and control
were deliberated and adopted. of corporate governance risks aiming to continuously enhance professional competency and
strengthen governance capabilities. During the reporting period two sessions of compliance training
for directors and senior management were held.
41 42Sustainability Report 2025
Key Performance Senior Management
The Company has formulated management systems such as the Working Rules for the General Manager and the
13 100 Working Rules for the Secretary of the Board of Directors which define the core functions of senior management. These During the reporting period the Company held Board of Directors meetings with a % functions include presiding over the Company’s production and business operations and management organizing the
attendance rate of all Board members and reviewed and approved 47 proposals. None of the implementation of resolutions of the Board of Directors and reporting work progress to the Board regularly. The Board
6 of Directors regularly inspects the performance of duties and work execution of the senior management to ensure the Company’s independent directors have served terms exceeding or nine years. In addition no efficient operation of the Company.
independent director holds independent directorships in more than 3 or 6 listed companies.As of the end of the report ing period
The Company has 7 senior management members including 2 female senior executives accounting
for 28.57% of the total.Board Committees
Remuneration Management for Directors and Senior Management
The Board of Directors has set up four specialized committees namely the Strategy and Sustainable Development
Committee Audit Committee Nomination Committee and Remuneration and Assessment Committee. The specialized The Company’s Board of Directors has established the Remuneration and Assessment Committee which enjoys
committees conduct research on professional matters and put forward opinions and suggestions for the Board’s independent decision-making and executive authority. The Committee is responsible for formulating remuneration
decision-making reference. Members of each committee perform their duties in accordance with the relevant working policies and assessment criteria for the Company’s directors and senior management as well as evaluating and
rules of the committees fully ensuring the professionalism and efficiency of the Board’s deliberation and decision- assessing their performance. Independent directors receive remuneration in accordance with contractual agreements.making. The remuneration policies for Board members are highly transparent. The compensation of the Company’s management
comprises base salary performance pay medium-and long-term incentive income and other components with ESG
factors incorporated into the assessment indicators.Reviewed Independent Is Committee Chair an
Board Committees Meetings Held Proposals Directors Ratio Independent Director Investor Relations Management
Strategy and Sustainable
Development Committee 1 2 66.67 No
Returns to Shareholders
Audit Committee 7 16 66.67 Yes
Loctek remains firmly committed to delivering long-term value to shareholders and has made shareholder returns a
Nomination Committee 2 3 66.67 Yes core tenet of its corporate governance strategy. The Company strictly adheres to the profit distribution commitments
outlined in its Articles of Association. To enhance the transparency and predictability of returns Loctek has introduced
Remuneration and the Three-Year Dividend Distribution Plan (2024–2026) which outlines a forward-looking framework for shareholder
Assessment Committee 1 2 66.67 Yes remuneration. This plan quantifies target payout ratios and clarifies implementation pathways reflecting the Company’s
dedication to equitable value sharing and reinforcing investor confidence.Audit Committee Year Total Cash Dividends As % of Net Profit Attributable to Shareholders of the
Distributed Listed Company in Consolidated Financial Statements
In accordance with the Transitional Arrangements for the Implementation of Supporting Rules under the New Company 2023 RMB 125.05 million 19.73%
Law and other relevant laws and regulations the Company has abolished the Board of Supervisors. The Audit
Committee of the Board of Directors exercises the functions and powers of the Board of Supervisors as prescribed
by the Company Law. It is responsible for coordinating and evaluating the Company’s internal and external audits 2024 RMB 102.39 million 30.48%
reviewing financial information and its disclosure and supervising and inspecting major decision-making matters.The members of the Audit Committee consist of accounting experts and industry professionals who put forward 2025 RMB 102.48 million 39.50%
suggestions on risk management and control in respect of the Company’s financial operations and industrial
development. Note: 2025 figures are based on estimates approved by the Board of Directors.
43 44Sustainability Report 2025
Information Disclosure Key Performance
Loctek upholds the principles of During the reporting period the Company conducted 89 online and offline investor communication
fairness transparency and equal
access in its information disclosure events received 180 person-times of on-site investor research visits and answered more than
practices. The Company proactively
discloses material information that 1450 investor phone inquiries. A total of 183 investor interactions were completed via the
could significantly impact shareholder
decision-making. In line with this Easy Interactive Platform.it has established a comprehensive
Information Disclosure Management
Policy that clearly defines both
statutory and non-statutory disclosure
requirements. These measures ensure
that disclosures are truthful accurate
timely complete and impartial— In May 2025 Loctek Corp. was selected as a case of the 2024 Best
enabling all shareholders to access Practices in Investor Relations Management for Listed Companies for
consistent and reliable information its outstanding performance in information disclosure standardized
regarding the Company’s operations operation and investor relations management.and performance.Golden Information Disclosure Award Golden Quality Corporate
by China Securities Journal Governance Award by Shanghai
Securities News Best Practices in Investor Relations
Management for Listed Companies
During the reporting period
The Company publicly disclosed 4 periodic reports and 183 ad-hoc announcements. It has Compliance and Risk Control
maintained a Grade A rating in the information disclosure assessment for 3 consecutive years and
has never been reprimanded or penalized by regulatory authorities for any information disclosure
violations. Internal Control System
The Company abides by relevant laws regulations and normative documents including the Basic Standards for
Investor Engagement Enterprise Internal Control and China Internal Auditing Standards and has formulated institutional documents such
as the Internal Control System and Internal Audit System. These efforts ensure the lawfulness and compliance of
business activities optimize corporate governance effectively manage risks and substantially enhance the strength
Loctek places strong emphasis on two-way communication and efficiency of internal control. The Company also clarifies the division of powers and responsibilities to ensure
with both existing and potential investors. The Company full implementation of all systems. The Company’s internal control system centers on the fundamental principle of
has adopted a formal Investor Relations Management safeguarding the steady development of the enterprise. It is built upon three functional pillars: internal control internal
Policy and responds to inquiries promptly through multiple audit and legal compliance. Supported by six key work approaches — risk identification internal control optimization
channels including SZSE Interaction Platform email internal audit online review legal management and anti-fraud management — the system has basically achieved four
and dedicated investor hotlines. An Investor Relations core internal control objectives: compliant business operation asset safety truthful and reliable financial information
and improved operational efficiency and effectiveness. In addition the Company has established effective internal
section on the corporate website (www.loctek.com)
control evaluation procedures conducts regular self-assessments on the effectiveness of internal control and discloses
provides easy access to key materials such as governance the Internal Control Self-Assessment Report in accordance with regulatory requirements.updates financial reports announcements and contact
details. To deepen investor understanding and foster
trust Loctek regularly organizes investor engagement During the reporting period
activities including earnings briefings investor open days
and on-site research visits. These efforts help strengthen The Company engaged KPMG Huazhen Certified Public Accountants (Special General
relationships with the capital markets and reinforce a Partnership) to conduct an audit on the Company’s internal control for 2025 which issued a
corporate culture rooted in transparency accountability Loctek's Listing Journey standard unqualified internal control audit report.and value creation.
45 46Sustainability Report 2025
Internal Audit
Set up professional positions to be responsible for the calculation
Job Position Setup declaration and payment of all types of taxes with dedicated staff
The Company has formulated the Internal Audit System and established an independent and comprehensive internal conducting review and verification.audit framework and set up a dedicated internal audit department. The department inspects and supervises the
authenticity and integrity of the Company’s financial information as well as the formulation and implementation of
internal control systems forestalls various risks and ensures the Company operates in compliance with regulations and
develops steadily.During the reporting period
Formulate the Financial Management System to specify provisions
System Construction
The Company carried out a total of 118 internal control and internal audit projects including 48 for the accrual and payment of various taxes.internal control audits 58 special internal control compliance projects 11 special expense audits
and 1 anti-fraud special project. Tax Risk
Prevention
and Control
Measures
The Company engages an accounting firm every year to audit its
Risk Management External Audit applicable tax categories applicable tax rates tax calculation and
tax payment status.To ensure stable and sustainable operations the Company has implemented a three-lines-of-defense risk control
model and revised its Operational Risk Identification Assessment and Control Procedures. The Company continues to
enhance mechanisms for risk identification evaluation mitigation monitoring and continuous improvement. An annual
major risk assessment is conducted to review the previous year’s risk management outcomes and guide improvements
in key areas. Efforts include refining internal policies aligned with strategic planning and addressing execution gaps. The
Company also invests in risk management training to elevate employees’ risk awareness and strengthen their ability to Finance personnel regularly participate in professional tax training
prevent and manage potential threats. Training and Knowledge Update for Finance Staff to keep abreast of the latest tax policies and apply relevant
knowledge to daily practical work.Formulate risk Organize and Follow-up Summarize the Update the
assessment plan implement risk Risk control audit and overall controlled operational assessment improvement risk level risk list
Key Performance
Basic Process of Corporate Risk Management Total tax payments for the reporting period amounted to RMB 156.88 million.Tax Management
Related Party Transactions
The Company continues to strengthen its financial governance framework through the development and
implementation of the Financial Management Policy. We have enhanced financial controls fully rolled out a company- To ensure that all related-party transactions are conducted legally fairly and reasonably the Company strictly adheres
wide budgeting system covering all business areas departments and staff. Initiatives include: Optimizing asset to applicable laws and regulations including the Guidelines No. 7 of Shenzhen Stock Exchange for Self-Regulation of
utilization to boost operational efficiency; Strengthening centralized cash management for efficient resource allocation Listed Companies—Transactions and Related-Party Transactions. Based on these regulations and actual business needs
and fund security; Conducting systematic tax policy research outreach and data reporting to improve the effectiveness the Company has formulated a Related-Party Transactions Management Policy which clearly defines pricing principles
of tax management. Through the integrated management of budgeting asset allocation cash flow and taxation the approval procedures and disclosure requirements to protect the legitimate interests of both the Company and its
Company has established a robust financial foundation to support high-quality development. shareholders.
47 48Sustainability Report 2025
Operational Compliance Business ethics and anti-corruption
The Company is committed to building a comprehensive compliance management framework that spans all business
units functions and processes. We continue to refine our internal mechanisms and foster a strong culture of
compliance across the organization. Anchored in our core priorities of reform growth and operations the Company Ethical Standards and Governance Framework
promotes organization-wide participation—from the Board of Directors and senior management to functional
departments and front-line business units—advancing compliance system development in a holistic and multi-tiered Loctek adheres to the principle of zero tolerance for corruption. It strictly abides by anti-corruption legal requirements
manner. of all jurisdictions involved in its business operations including the United Nations Convention against Corruption and
the Anti-Unfair Competition Law of the People's Republic of China. The Company has also formulated systems such
as the Anti-Bribery and Anti-Corruption Policy and the Employee Code of Conduct Against Commercial Bribery. At the
Strengthening Conducting Internal Cultivating a Culture of decision-making level the Board of Directors oversees the strategic orientation of business ethics and anti-corruption
Compliance Leadership Control Reviews Compliance work reviews major matters and bears the ultimate supervision responsibility. At the management level senior
management takes the lead in formulating and implementing rules coordinating resource allocation and advancing
the development of relevant management systems. At the execution level all functional departments implement
A risk and internal control man- Audit initiatives focused on key The Company continues to inte- business ethics and anti-corruption measures in light of actual business conditions and conduct daily management
agement team jointly formed elements such as the internal grate domestic and internation- and information submission. This has formed a top-down business ethics management system featuring clear rights
by the Board’s Audit Commit- environment risk assessment al legal resources to provide pro- and responsibilities as well as coordinated and efficient operation. The Company explicitly prohibits employees from
tee and the Internal Audit De- control activities information fessional support for day-to-day gaining competitive advantages in business activities by offering or accepting bribes kickbacks or improper benefits.partment oversees and evalu- and communication and internal operations and new business The Company has established and improved a sound anti-fraud mechanism. It duly pays attention to and inspects
ates the effectiveness of internal monitoring. These efforts follow ventures. Legal awareness train- potential fraudulent conduct during internal audits and arranges unscheduled legal training to regulate employees'
controls to ensure the integrity a full-cycle process—planning ing was conducted to deepen ethical behaviors in an all-round manner so as to firmly prevent fraud embezzlement and corruption.compliance and viability of the execution reporting and fol- understanding of compliance re-
system in supporting the Com- low-up—to form a closed-loop quirements and internal control During the reporting period
pany’s operational goals. internal control review mecha- procedures fostering a culture
nism. of integrity and accountability. The signing rate of the Company’s integrity clauses reached 100%.Anti-Corruption Awareness and Training
Legal Awareness and Compliance Training To foster a culture of integrity and strengthen compliance awareness Loctek regularly delivers training and awareness
programs on business ethics and anti-corruption. These sessions guide employees in aligning their behavior with the
The Company places a strong emphasis on cultivating a culture of compliance. Compliance training is integrated company's ethical standards and regulatory obligations.into the overall employee development plan with senior executives leading by example in participating in regular
compliance education. The Company also organizes targeted compliance training sessions for employees to raise During the reporting period
awareness and reinforce internal controls.The Company conducted 8 anti-corruption and integrity training sessions engaging
During the reporting period 461employees.The Company held 8 legal and compliance training sessions across a range of topics and audiences
Case Anti-Fraud Orientation
with a total training duration of 25 hours.In March Loctek launched the 37th anti-fraud and integrity
training session for new employees delivered personally by the
Chief Risk Control Officer. The training covered the definition and
causes of fraud duty-related crime cases risk management rules
and reporting incentive policies.Combining several real cases the
officer explained the basic concept root causes and preventive
measures of fraud in an easy-to-understand way. The training
helps steadily strengthen employees' integrity awareness and
foster a sound corporate integrity culture. New Employee Anti-Fraud and
Integrity Training
49 50Sustainability Report 2025
Anti-Corruption Risk Prevention and Control Whistleblower Protection Measures and Reporting Channels
The Company continues to strengthen integrity risk prevention and control and has built an integrity risk management Confidentiality
system covering all employees. It regularly conducts inspections on integrity risk points sorts out and assesses potential
integrity hazards in all business processes and key positions and formulates targeted prevention and control measures No individual is permitted to disclose the whistleblower's identity to the subject of the report or any unrelated
party.accordingly. During the reporting period no major business ethics risk incidents occurred within the Company.Investigative content methods and direction must not be shared with unrelated personnel or the subjects
under investigation.Any breach of confidentiality will result in disciplinary action.Risk Area Risk Description Response Measures
Safety Protection
Strictly implement the supplier admission and evaluation mecha-
There may be corrup- nism continuously improve the transparency and standardization of Retaliation against whistleblowers or related witnesses is strictly prohibited. Depending on the severity of the
tion risks such as supplier the bidding process and build an open and transparent standard- retaliation consequences may include dismissal termination of employment contracts or referral to judicial Procurement bribery and acceptance of ized procurement system； authorities.kickbacks. Strengthen integrity education and improve the accountability sys-
tem to further consolidate the compliance foundation.Reporting Channels
Risks such as asset em-
bezzlement data security Standardize operating procedures strengthen authority manage-Operation Email: haitao.wang@loctek.com；lianjie@loctek.com
leakage and process fraud ment and control and optimize inspection and audit arrangements
may exist. to realize systematic control over operational risks.Tel.: 13685818299; 0574-56809494
WeChat ID: LGlianjie
Mailing Address: Risk Control Center No. 436 Xueshi Road Shounan Subdistrict Yinzhou District Ningbo City
Zhejiang Province China
Whistleblower ProtectionLoctek upholds the principles of “notolerance no opportunity and no desire Supervision over Business Partners on Anti-Corruption andfor misconduct” and has established a Anti-Bribery
Whistleblower Reward Policy to encourage
integrity and transparency. A dedicated The Company has established a strict access review mechanism for business partners. Prior to cooperation it conducts
department has been assigned to handle Whistle- Fraud Indicators Information a comprehensive review of their background credit standing and integrity records and refuses to cooperate with
reports of fraud and corruption. Multiple blowing Identified Collection enterprises with integrity flaws or corruption-related records. In the course of cooperation the Company specifies
convenient and confidential reporting anti-corruption obligations via contractual clauses and monitors the integrity performance of business partners on a
channels are available including warning regular and unscheduled basis. If any improper conduct such as embezzlement or bribery is identified among business
signage telephone hotlines anonymous partners the Company will immediately suspend cooperation and pursue corresponding legal liabilities as appropriate
mailboxes and designated email addresses. so as to jointly safeguard a fair and impartial market environment.The Company strictly follows confidentiality
and recusal protocols in handling all Fraud Investigation Fraud Investigation Task Force Anti-Monopoly and Anti-unfair Competition
whistleblower reports to ensure that both
the identity of the whistleblower and the The Company has incorporated anti-monopoly compliance into its ESG governance system and formulated regulations
content of the report are fully protected. such as the Guidelines for Marketing Internal Control and Compliance. At the decision-making level the Board of Directors
oversees the strategic orientation of anti-monopoly and anti-unfair competition work reviews major relevant matters
Loctek accepts both anonymous and
Investigation Outcome Handling and bears the ultimate supervision responsibility. At the management level the senior management takes the lead in signed reports in any format. Once a
and Feedback formulating and implementing rules coordinating resource allocation and advancing the development of the relevant report is verified the Company initiates an system. At the execution level all functional departments implement anti-monopoly and anti-unfair competition measures
investigation and provides a cash reward based on actual business conditions conduct daily management and information submission thus forming a top-down
if the report is substantiated. If the report Whistleblower Case Handling Procedure management system with clear division of powers and responsibilities and efficient collaboration.The Company explicitly
is found to be untrue the whistleblower is requires all marketing activities to abide by the principle of fair competition and strictly prohibits any monopolistic and
notified. Malicious or fraudulent reporting unfair competition acts. It has refined the compliance requirements for key links including the formulation of pricing
will result in legal liability for the reporting strategies organization of promotional activities advertising content release and channel cooperation management so
party. as to ensure all marketing activities are conducted in a legal and compliant manner.
51 52Sustainability Report 2025
Anti-Monopoly and Fair Competition Risk Control Information Security and Privacy Protection
The Company has formulated comprehensive measures and plans against cut-throat competition which are jointly
implemented by the legal department and patent team to build a full-cycle management mechanism featuring prevention
– control – optimization. On the prevention front a hierarchical and categorized training matrix is established to ensure Information Security System
compliance requirements are precisely communicated to all business units. On the control front a compliance firewall
is put in place to enable early identification and early warning of potential risks.On the optimization front the Company
facilitates the development of a healthy competitive ecosystem by participating in policy discussions and formulating Loctek has developed policies such as the Information Security Incident Management Policy and Network Risk
industry standards. Management Policy to form a comprehensive information security system covering hardware data systems and
customer information. These safeguards ensure business continuity enhance information security assurance throughout
Anti-Monopoly and Fair Competition Training operations and protect the data privacy of all stakeholders. No incidents of customer privacy breaches or data loss occurred during the reporting period.The Company has formulated differentiated training arrangements for employees of business lines across different
countries. The training covers the latest developments in domestic and foreign anti-monopoly laws and regulations Information Security Manage-
in-depth analysis of typical cases and compliance operation guidelines for real business scenarios. It ensures that the ment Organization
concepts of anti-monopoly and fair competition are internalized into employees’ code of conduct so as to guard against
competition compliance risks at the source.Leading Group for Information Information Security
During the reporting period Security Work Implementation Team
The Company held 1 training session on anti-monopoly and fair competition for employees.All functional departments
Case Key Analysis of Comparative Advertising under Germany’s Unfair Competition Regulations and project teams
In March the Company conducted targeted training for employees engaged in German business on the key
points of comparative advertising under Germany’s unfair competition regulations. Combining the core provisions Information Security Organizational Structure
on comparative advertising stipulated in the Act against Unfair Competition (Gesetz gegen den unlauteren
Wettbewerb – UWG) and relevant EU regulations the training sorted out typical cases of comparative advertising
in Germany in recent years. It elaborated in detail on how to conduct lawful and compliant comparison of During the reporting period
products and services when carrying out advertising promotion in the German market. The training enables
employees to accurately grasp the compliance requirements for comparative advertising in the German market
No incidents of customer privacy breaches or data loss occurred during the reporting period.in subsequent business promotion activities and effectively avoid legal risks.
53 54Sustainability Report 2025
Data Protection Measures Emergency Response
The Company has formulated and implemented the Information Classification and Security Level Management Rules
and Security Incident Response and Emergency Management System. It categorizes confidential information into
three grades: Top Secret Confidential and Secret and builds a three-level linkage emergency response system for
Potential risks related to data security and privacy are identified and assessed. Countermeasures information security incidents covering headquarters regional organizations and departments. The Company fully
are implemented based on risk levels and the effectiveness of security controls is regularly incorporates classified protection requirements into cybersecurity and information security work strictly abides by
Information
Risk evaluated. confidentiality agreements and customer information protection specifications and ensures security management of
Management A cross-border data compliance assessment project has been launched to review major business information throughout its full life cycle.systems and ensure cross-border data operations remain compliant with relevant regulations. The Corporate Information Center has set up a dedicated emergency response team. Based on risk analysis
and redundancy demands of core equipment and facilities it has formulated emergency plans to guard against
ransomware malware network failures and other contingencies enabling the information system to respond promptly
The Company has formulated the Management System for Information Security Hidden to unexpected incidents. The Company carries out 1–2 emergency drills every year rectifies problems identified in the
Danger Disposal which regulates the full-process management of the acceptance drills and makes improvements until the expected targets are fulfilled.rectification and re-inspection of information security hidden dangers. It clarifies that the Information
person responsible for each hidden danger shall be held as the primary person accountable Security Hidden
and mandates completion of rectification and corresponding feedback within the prescribed Danger Strengthening Employee Training
time limit. The Information Security Implementation Team follows up and conducts re- Inspection
inspection to ensure closed-loop disposal of all hidden dangers. Personnel with inadequate
rectification performance will be held accountable in accordance with relevant rules. The Company fully advances the development of information security culture and improves all employees’ security
literacy through a multi-level training system. It regularly holds special information security training in the form of case
sharing and knowledge quizzes covering core areas including personal information protection data security password
management as well as website and email security. The training continuously enhances employees’ awareness of
Equipment and cabling are routinely inspected and maintained with obsolete systems retired cybersecurity risks and builds a full-coverage information security defense network with the participation of all staff.Equipment in a timely manner. Access control and surveillance are enforced in critical data areas to
Security prevent unauthorized entry. Data centers are kept clean and orderly to ensure safety and The Company conducts phishing simulations on a quarterly basis. Using trending topics or welfare policies of the
backup facilities are in place to respond to emergencies. quarter as plausible lures it sends simulated email links to all employees to test their anti-fraud awareness. Targeted
anti-fraud training is arranged for employees who fail the simulation test so as to comprehensively strengthen the
overall cybersecurity awareness of the workforce.During the reporting period
Network security risks are continuously assessed across areas such as access controls
security mechanisms services and segmentation. Based on the scale impact and likelihood The Company organized 4 training sessions on information security and privacy protection with
of threats risk priorities are set. Technical safeguards such as data encryption identity Cybersecurity
Protection
authentication digital signatures firewalls and vulnerability detection tools are employed to a total of 1460 participants.strengthen defenses.Key Performance
During the reporting period the total investment in information security reached 2.6 million RMB.
55 56Sustainability Report 2025
Green and Low-Carbon
Development for
Environmental Sustainability
Company Actions
Response to Climate Change
Climate Change Action
Environmental Management
Reduce Resource Consumption
SDGs
57 58Sustainability Report 2025
Response to Climate Change
Climate Change Governance
Loctek Corp. Ltd. actively responds to climate change challenges. In reference to the framework and guiding principles
of the Task Force on Climate-Related Financial Disclosures (TCFD) and drawing on widely recognized best practices in
the ESG industry the Company has formulated regulations including the Greenhouse Gas Control Procedure and estab-
lished a sound climate change management system. It clarifies management responsibilities at all levels incorporates
climate change risks into the corporate risk management framework standardizes climate governance prevents and
reduces environmental incidents and advances the enterprise steadily toward the net-zero carbon target. During the
reporting period the Company held one training session on climate change response aiming to strengthen employees’
climate-related competency development and build a professional green talent team.Management Information
Structure Disclosure
01 Board of Directors: Supervise and revise the Company’s strategic plans expected 03 Regularly issue the Sustainability Report and continuously update climate change-
goals policies and guidelines for addressing climate change; related information allowing investors and the public to clearly understand the
Board Secretary Office: Formulate the Company’s strategic policies on climate Company’s actions in responding to climate change.response review and make decisions on major matters including issues related to
climate change.Functional departments of local factories: Undertake the responsibility of formulating
and implementing climate change response strategies report work progress regularly
coordinate resources from all parties keep close track of policy and regulatory
updates flexibly adjust strategic directions accordingly and fully advance the green Supervision and
and low-carbon transformation process. Assessment
04
Incorporate climate change response into the performance appraisal system;
Regularly review the completion status of climate-related goals and indicators
through meetings of the ESG Management Working Group.Capacity
Building
02
Decision
Internal training: Launch training on energy conservation and low-carbon Support
development for personnel in different roles including new employees key
equipment management posts and R&D staff; invite industry experts to hold
lectures and seminars on climate change. 05 In decision-making procedures such as formulating strategic plans and selecting
External communication: Actively participate in sustainable development-related sites for new projects take climate factors into comprehensive consideration
exchange meetings organized by industry institutions and universities. alongside other key factors including finance and market conditions so as to
ensure the scientificity and sustainability of corporate decisions.
59 60Sustainability Report 2025
Climate Change Strategy
The Company adopts a pragmatic and forward-looking approach to climate change actively identifying risks and poten-
tial opportunities related to its operations. Based on this understanding we have initiated comprehensive climate risk
assessments and guided by their outcomes implemented a series of targeted and impactful strategies aimed at miti-
gating adverse effects. These efforts are designed to ensure the Company’s resilience and sustainable development in
the face of increasingly complex and dynamic environmental conditions.Potential Climate Change Risks
Probability
Risk Category Risk Description Impact Duration of Value Chain Priority Financial Impact of Magnitude Impact Ranking Description Mitigation MeasuresLinks Impacted
Occurrence
Develop and implement detailed emergency response plans to reduce losses
Extreme weather events such as typhoons and Increase in from natural disasters.Upstream Operating Costs
Acute Risk torrential rain may disrupt raw material supply chains Low Relatively Short and Operations Relatively Prioritize employee health and safety by issuing extreme weather alerts and or delay product deliveries affecting operations and Low Medium Term Low Decrease in enabling flexible work and production arrangements.customer relationships. Downstream Operating Revenue Ensure supply chain continuity through contingency plans addressing weather-
induced disruptions.Physica
Risk
Limited access to water resources could hinder
production processes and reduce operational efficiency. Enhance water resource management during production through the adoption of
Chronic Rising sea levels may affect the normal operations of
Upstream water-saving technologies and equipment to reduce waste.Risk certain subsidiaries potentially incurring relocation Low Medium
Medium and
Long Term Operations Medium
Increase in Op-
erating Costs Incorporate climate risk into site selection for new operational facilities.costs. Downstream Develop internal emergency response plans for major public health incidents and
Large-scale public health emergencies could disrupt maintain essential medical supplies.production.Policy and Increasingly stringent environmental regulations may
Regulatory Low Relatively Relatively Increase in Op-
Establish and enhance environmental management systems with clear
place restrictions on production transportation and Low Medium Term Operations Low erating Costs responsibilities and standard operating procedures to ensure compliance with Risk sales. evolving regulations.Increase in
Operating Costs
Technolo- Insufficient investment in low-carbon technologies may Relatively Relatively Conduct in-depth market research on energy-saving and carbon-reduction
gy Risk result in a lag behind market expectations. Low Low Short Term Operations Low Decrease in technologies; develop R&D strategies to ensure adequate investment and reduce
Operating the technology gap with industry peers.Revenue
Transi-
tion Risk
Market As consumers increasingly favor eco-friendly materials
Opera-
Low Relatively Medium Term tions、 Relatively Decrease in Op-and products failure to adapt product lines may lead to Increase the share of green product offerings; explore new business areas and
Risk decreased sales and loss of market share. High High erating Revenue markets to reduce dependence on single-industry revenue streams.Upstream
Increase in
Operating Costs Disclose information on carbon emissions mitigation measures and outcomes
Reputa- Poor performance in addressing climate change Relatively Short and through ESG reports.tional Risk may lead to negative public perception and damage Low Low Medium Term Operations
Relatively
Decrease in
corporate reputation. Low Operating Maintain proactive communication with stakeholders to build trust and long-term
Revenue support.
61 62Sustainability Report 2025
Potential Opportunities of Climate Change
Opportunity Opportunity Probability of Impact Duration of Value Chain Priority Financial Impact
Category Description Occurrence Magnitude Impact Links Impacted Ranking Description Mitigation Measures
Use premium bamboo materials to enhance product sustainability and consum-
Technological Adoption of eco-friendly raw materials helps reduce the Relatively Relative- Increase in er appeal.opportunity product’s carbon footprint. Medium Long Term Operations ly High Operating High Revenue Align branding with environmental values and promote product sustainability
through advertising social media and PR initiatives.Increase in
Growing climate awareness is prompting stricter supplier Rela- Medium Operations Operating Costs
Market Opportunity standards. With stronger climate governance than some Relative- Continue strengthening green operations eco-design sustainable manufactur-peers the Company is well-positioned to capture in- Medium tively and Long Down- ly High Increase in ing packaging and logistics to enhance competitive advantage.creased market share. High Term stream Operating
Revenue
Reduction in
Improve the efficiency of natural resource use reduce reli- Rela- Operating Costs Promote resource efficiency through initiatives focusing on energy savings ma-Medium
Resource Optimization ance on fossil fuels increase the proportion of clean ener- Medium Medium Operations tively terial efficiency and performance improvement. Leverage digital platforms Increase in
gy and alleviate environmental pressure. Term for refined operational management and support customers and suppliers in Low Operating achieving higher resource utilization across the industry.Revenue
Note:
1. Probability of Occurrence: Refers to the frequency interval and possibility of occurrence of risks/opportunities deter-
mined based on historical probability external scenarios policy implementation progress and expert forecasts. Proba- 4. Impact on Value Chain: Refers to upstream (involving raw material suppliers procurement and logistics) operations
bility of occurrence ranges from “Low” to “High”. (involving production manufacturing and internal processes) and downstream (involving distribution sales and cus-
tomer services).
2. Impact Size: Refers to the size of the impact determined by the impact level and the likelihood of occurrence of risk/
opportunity considering factors such as the business model value chain and financial impact. Impact magnitude rang- 5. Priority Ranking: The risk / opportunity priority is ranked as “Low” “Medium” or “High” based on a comprehensive as-
es from “Low” to “High”. sessment of probability of occurrence impact magnitude and time frame in combination with the Company’s actual
situation.
3. Impact Timeframe: Different risks and opportunities impact the Company in varying time frames. The impact time
frame is categorized into short-term (0-1 year) medium-term (1-5 years) and long-term (over 5 years) by the Company. (Note: Definitions of probability of occurrence impact size impact timeframe impact on value chain and priority rank-
ings in other sections of the report are consistent with the above and will not be repeated.)
63 64Sustainability Report 2025
Climate Risk Management Climate Metrics and Targets
The Company continuously improves the identification assessment and management processes for climate-related With a deep understanding of its operational characteristics and long-term sustainability ambitions the Company has
risks and opportunitiesand enhances corporate climate resilience and achieves a transition from passive compliance to set clear climate-related goals—particularly in reducing greenhouse gas emissions and improving energy efficiency.proactive leadership. These goals are supported by innovations in technology and optimization of business models aimed at achieving a win-
win for both economic growth and environmental protection.Identification Implement low-carbon and environmental protection policies in factories and office
premises and continuously optimize initiatives such as waste recycling packaging
We conduct a comprehensive review of all operational processes to Short-term reduction and clean energy application. For newly-built factory premises prioritize the
pinpoint critical areas that may be affected by climate change. This adoption of energy-saving products and technologies. Vigorously promote energy-
ensures both thoroughness and precision in risk identification. saving technological renovation and energy management measures in operational sites
to facilitate energy conservation and emission reduction.Integrate the sustainable development strategy into internal systems and processes
set binding requirements for the Company’s own development as well as its business
Medium-term partners and drive the upgrading of energy conservation and emission reduction
Assessment technologies. Actively assess carbon emission issues arising from the supply chain daily operations and corporate development to support the sustainable advancement of
Using scientifically grounded methods we assess the identi- carbon emission reduction.fied climate-related risks quantify their potential impacts and
categorize them by severity. These insights serve as a foun-
dation for developing targeted and effective risk mitigation
strategies. Continuously advance the optimization and reduction of carbon emissions from
Long-term internal operations refine carbon emission reduction plans conduct carbon audits for operational premises and formulate detailed carbon reduction roadmaps to advance
the implementation of the dual-carbon initiative.Mitigation
Based on the assessment outcomes we implement tailored
response measures such as enhancing internal controls and Targets 2025 Progress
strengthening emergency response mechanisms to ensure
that climate risks are effectively managed and mitigated.By 2030 the Company will promote energy structure Renewable electricity purchased：9655213 kWh
optimization and increase the share of renewable
energy through measures such as establishing green
factories. PV power generation: 1645285 kWh
By 2050 the Company aims to achieve net-zero
emissions across its own operations and value chain. GHG emissions reduction: 9277.7 tCO?e
Note: The renewable electricity purchased is sourced from wind power.
65 66Sustainability Report 2025
Carbon Emissions Management Carbon Emission Reduction Measures
The Company has formulated a Greenhouse Gas (GHG) Control Procedure and established a dedicated GHG Inventory
Lecangs Green Transition via Full Electrification and Circular Utilization
and Voluntary Reduction Task Force. The task force is chaired by the Head of the Safety Committee who oversees daily Case
operations while the Environmental Manager serves as Executive Secretary responsible for planning and coordinating
all GHG-related initiatives. Using a standardized tool—Activity Data Quality Management Table—the Company system- Aiming to conserve resources and protect the environment Lecangs has advanced green upgrading since
atically collects manages quantifies and inventories its GHG emissions to ensure that decarbonization efforts are car- 2023 by adopting clean energy and deepening resource circular utilization making positive contributions to
ried out effectively and consistently. fostering a green harmonious and sustainable development environment.At present fuel-powered forklifts
have been largely phased out in Lecangs. Over 500 electric forklifts and AGVs have been put into operation
盘查程序流程图 to achieve zero-emission work cutting carbon dioxide emissions by hundreds of tons every year. New ener-
Define organizational and operational gy yard tractors are deployed outside warehouses to reduce fuel emissions. Meanwhile the warehouse im-
boundaries plements re-stocking of returned goods and adopts recyclable green packaging lowering the product scrap
rate and supporting material recycling.Identify emission sources
Set base year and calculate emissions
Electric Forklift Yard Goat On-site Tractor Recyclable Packaging
Develop the GHG inventory
Metric Unit 2025
Propose reduction strategies
Total GHG Emissions (Scope 1 + 2) tCO2e 17612.91
Document the inventory
GHG emissions intensity (Scope 1 + 2) tCO2e/ RMB million (revenue) 2.62
Greenhouse Gas Emission Intensity per Unit of
Prepare initial report draft Energy Consumption (Scope 1+Scope 2) tCO2e/ton of standard coal 2.18
Implement corrective actions and Per Capita Greenhouse Gas Emission Intensity
system improvements (Scope 1+ Scope 2) tCO2e /person 4.43Operate the system and maintain records
Direct GHG emissions (Scope 1) tCO2e 6920.38
Conduct internal/external verification
Indirect GHG emissions (Scope 2) tCO2e 10692.53
Conduct management review Greenhouse Gas Offsets (Scope 1 + Scope 2) tCO2e 9277.71
Carbon Emission Reductions Equivalent to Clean tCO2e 1350.78
GHG Inventory Flowchart Energy Power Generation
Note: Clean energy power generation only includes photovoltaic power generation and excludes purchased green electricity.
67 68Sustainability Report 2025
Climate Action
Key Performance Indicators
Full Life Cycle Management of Green Products During the reporting period
In active response to the Dual Carbon Goals the Company upholds the philosophy of green development and
integrates green management into every stage of the full product life cycle. By proactively conducting carbon footprint
accounting the Company gains full visibility into product carbon emissions across all phases to ensure compliance with the Company produced
environmental standards and minimize environmental impacts.Covering design procurement production packaging
and transportation the Company fully implements green management strategies. It is committed to building a low- 4.0753 million green products
carbon eco-friendly and sustainable product ecological chain contributing its efforts to protecting the planet. The
Company’s products have been awarded the China Environmental Labeling Product Certification Certificate.During the reporting period The proportion of green products in the product port-
55000 folio as well as their share in sales volume and sales Loctek purchased over pieces of bamboo board tables and bamboo
boards with a procurement value of RMB 18.86 revenue all reached 100%. million.China Environmental Labelling Program
(CELP) Certificate
R&D and Design The Company develops a diverse range of green products incorporates environmental
Phase attributes into the product design stage and guides the design team to implement low-
carbon design concepts.Case Carbon Footprint Practice
Procure- Environmentally friendly materials are adopted and stringent control is exercised over the content
ment Phase of hazardous substances in raw materials.From November 2025 to October 2026 the Company’s
German subsidiary (Flexispot GmbH) completed the Cli-
The Company advances production process optimization and product component matePartner carbon footprint certification and obtained the
standardization. Inspections are carried out in compliance with product harmful gas Climate Protection Partner Certificate. It has offset a total
Production testing procedures and standards covering every production procedure to strictly
Phase control product quality and steadily raise the qualification rate of semi-finished products.of 35900 kilograms of carbon dioxide equivalent emissions.Meanwhile we prioritize green production and have obtained the certifications of Clean By honoring the commitment of "planting one tree per ton
Production Enterprise and Green Factory. of CO? offset" the subsidiary achieves corporate carbon
neutrality via capital investment and practices green and
low-carbon development.Packaging and Packaging methods have been optimized and packaging materials have been upgraded to recyclable
Transportation and biodegradable eco-friendly alternatives. We focus on lightweight packaging design to save
Phas transportation space and reduce load weight and traditional forklifts have been replaced with electric
forklifts. Climate Protection Partner Certificate
69 70Sustainability Report 2025
Green Factory Wastewater Fish Farming
Loctek has long been committed to promoting the green pro- The Company attaches importance to integrating
duction model making efforts to lower energy consumption sustainable development with green production.and cut emissions. It adheres to a green and sustainable de- By introducing a biochemical treatment system
velopment path and builds an ecological factory characterized and high-efficiency microbial degradation
by rooftop power generation wastewater aquaculture pleas- technology harmful substances in wastewater
ant natural scenery and abundant fruits and plants.The Com- are properly treated. Both effluent water quality
pany has established a leading group for cleaner production and suspended solids concentration comply with
steadily advanced cleaner production audits strictly imple- regulatory standards. Sewage is upgraded to
mented relevant implementation plans and continuously opti- water quality suitable for fish survival through
mized production processes based on audit results. Thanks to biochemical treatment so as to enhance
its outstanding performance and remarkable achievements in resource recycling and utilization.environmental protection the Company has been accredited as National Green Factory
a National-level Green Factory. Aquaculture with Treated Wastewater
During the reporting period
Ecological Vegetable Garden
The Company completed a self-assessment in accordance with the requirements for
enterprises undertaking voluntary cleaner production audits and implemented corre-
sponding rectification measures. The Company's Guangxi Manufacturing Base has developed an Ecological Vegetable Garden covering an area of 60
square meters. Utilizing domestic sewage as a nutrient source and adopting sewage reuse technology with water
sprinkler irrigation the base achieves resource recycling while promoting the healthy growth of crops. Currently the
Rooftop Photovoltaic Power garden successfully cultivates a variety of vegetables including scallion water spinach red amaranth green amaranth
Malabar spinach cherry tomatoes cucumbers watermelons and bell peppers.The Company actively promotes the application of clean energy and makes full use of rooftop space. It has built rooftop
photovoltaic power stations with a total installed capacity of over 1260 kWp. By adopting low-carbon and clean energy
supply solutions the Company reduces energy consumption and carbon emissions accelerates the optimization and
upgrading of the energy structure and contributes to building a green low-carbon and sustainable development
ecosystem.During the reporting period
The Company consumed 1645285 kWh of photovoltaic power generation cutting
carbon dioxide emissions by 1350.78 tCO?e.Ecological Vegetable Garden
Biodiversity Conservation
The Company strictly abides by relevant laws regulations and policy provisions including the Soil Pollution Prevention and
Control Law of the People’s Republic of China and the Opinions on Further Strengthening Biodiversity Protection. It attaches
great importance to ecological environmental protection formulates corresponding institutional rules and continuously
standardizes the impact of its operations on biodiversity.The Company commits to implementing sound environmental
management and pollution prevention and control measures in daily operations ensuring that its operational activities
will not exert any adverse impacts on the local ecological environment. As of the end of the reporting period none of
the Company’s production bases are located in important or sensitive biodiversity conservation areas and no incidents
Rooftop Photovoltaic damaging biodiversity have occurred.
71 72Sustainability Report 2025
Biodiversity Conservation Measures Key Performance Indicators
Source Control Conduct heavy metal testing on raw materials to ensure they are free from 2025 Environmental Protection Investments Environmental Protection Taxenvironmentally hazardous substances.RMB 2.2987 million 12200RMB
Production Process Recycle organic solvents used in production to prevent air pollution.Promote source reduction and resource utilization of solid waste cut waste emissions Environmental Pollution Incidents Proportion of Total Environmental Waste Management across the whole production process and mitigate adverse impacts on biodiversity. Investment in Operating Revenue
0Case 0.30%
Logistics & Transportation Adopt degradable plastic bags to reduce pollution to soil water bodies and marine ecosystems.Environmental Management Environmental Publicity
The Company attaches great importance to fostering employees’ environmental awareness and has formulated the
Environmental Training Management System. It invites professionals in environmental protection workplace safety
Environmental Governance and fire protection to deliver training sessions and lectures on emergency response knowledge. Through hanging
environmental protection slogans and setting up environmental publicity boards the Company advocates eco-friendly
Loctek adheres to the environmental policy of "Environmental Protection Pollution Prevention Energy Conservation and values among staff standardizes environmental training arrangements and clarifies training content and requirements
Continuous Improvement". The Company has formulated internal regulations including the Environmental Management for employees at all levels. This helps to improve employees’ professional competency in environmental management
Rules Environmental Manual and Environmental Procedure Documents establishing a multi-level and comprehensive envi- and prevent environmental incidents.ronmental management system.As the top-level designer and core supervision body for the Company’s environmental pro-
tection work the Board of Directors is responsible for the overall coordination of relevant management matters and as-
sumes ultimate accountability when necessary. On this basis the Company has set up an Environmental Protection Leading
Group headed by the General Manager to coordinate and advance various environmental protection initiatives. Meanwhile Case Environmental Protection Training Series at Binhai Factory
an environmental responsibility assessment mechanism has been established and incorporated into the overall perfor-
mance appraisal system to strengthen all employees’ awareness of environmental accountability.As the functional im-
plementation department the Health Safety and Environment (HSE) Department undertakes full-process supervision of To comprehensively enhance employees’ environmental responsibility awareness and professional competence
environmental management. It regularly carries out cleaner production activities in strict accordance with standardized pro- Binhai Factory organized two special environmental protection training sessions in August and November 2025.cedures to ensure the effective implementation of all environmental protection systems. The training covered the standardized disposal of hazardous waste environmental risk control in confined
spaces as well as the popularization of environmental protection laws regulations and relevant professional
During the reporting period knowledge. It further deepened all employees’ understanding of environmental protection work and effectively
strengthened their awareness and capability to implement environmental protection measures and improve
The Company obtained the ISO 14001 Environmental Management System Certification. No major envi- environmental compliance in daily operations.The training achieved a 100% participation coverage and a 100%
ronmental incidents occurred nor were any administrative penalties imposed by government environ-
mental authorities. assessment pass rate injecting new momentum into the factory’s green and high-quality development.Key Performance Indicators
During the reporting period the Company conducted 19 internal and external environmental protection training
sessions attracting 3614 person-times of participation with a total environmental training duration of 32
hours.Loctek ISO 14001 Environmental Guangxi Factory ISO 14001 Environmental Jiangshan Factory ISO 14001 Environ-
Management System Certificate Management System Certificate mental Management System Certificate
73 74Sustainability Report 2025
Environmental Strategy
As part of its operational strategy the Company proactively identifies potential environmental risks and opportunities.By leveraging scientific methodologies and advanced technologies Loctek systematically analyzes environmental fac-
tors that could impact its business. This risk-based approach enables the Company to implement targeted measures to
mitigate threats and capitalize on opportunities thereby laying a solid foundation for long-term sustainable growth.Potential risks in environmental management
Risk Category Risk Description Probability of Impact Magni- Duration of Im- Value Chain Priority Financial Impact Mitigation MeasuresOccurrence tude pact Links Impacted Ranking Description
Regulatory Increasingly stringent environmental regulations
Increase in
may result in penalties or operational disruption if Low Relatively Short Operations Relatively non-op- Maintain an environmental management system clarify roles Compliance not followed. Low Term Low erating and responsibilities and conduct regular audits.expenses
Emissions from production processes could exceed Relatively Relatively Short Relatively Increase in Air Emissions regulatory limits if control systems malfunction or Regularly monitor emissions conduct routine maintenance of
are inadequate. Low Low Term
Operations Low Operating Costs treatment systems and ensure full compliance.Potential Opportunities in Environmental Management
Opportunity Opportunity Probability of Impact Duration of Value Chain Priority Financial Impact
Category Description Occurrence Magnitude Impact Links Impacted Ranking Description Mitigation Measures
Growing consumer demand for eco-friendly prod- The company can develop and promote more eco-friendly
Market Opportunity ucts presents an opportunity to develop and pro- Medium Relatively
Medium Relatively Increase in
mote sustainable recyclable and energy-efficient High and Long Operations High Operating
energy-saving and recyclable products to meet consumers’
demand for green office solutions and explore new market
offerings. Term Revenue space.
75 76Sustainability Report 2025
Environmental Risk Management Key Performance Indicators
Identification and Assessment
During the reporting period the Company conducted 20 environmental hidden hazard
To effectively prevent environmental risks the Company implements the Environmental Aspect Evaluation and List of inspections with a hidden hazard rectification rate of 100%.Significant Environmental Aspects. It comprehensively identifies and evaluates environmental risk factors arising from
production activities minimizes and eliminates potential environmental risks to the greatest extent and strengthens
the overall environmental management and control capability of the Company.Risk Identifica- By quantifying the ratio of the quantity of environmentally hazardous substances to their
tion threshold quantities the Company preliminarily identifies high-risk links throughout the en-tire production process.Risk Assess- It conducts a comprehensive assessment of the internal environmental risk control capacity
ment and the sensitivity of external environmental risk receptors.Risk Response It analyzes the probability of occurrence and the potential impact magnitude of sudden envi-
Analysis ronmental incidents.Risk Measure The Company formulates comprehensive environmental risk prevention control and emer-
Formulation gency measures for identified risks and opportunities. The operation department is responsi-ble for following up on the implementation of relevant measures.Decontamination Furnace Waste Gas Decontamination Furnace Waste Gas
Discharge Outlet Signage Discharge Outlet Signage
Risk (Before Rectification) (After Rectification)The risk grades of corporate sudden environmental incidents are classified in accordance
Grading with the matrix method.Environmental Hidden Hazard Inspection
In strict compliance with environmental protection laws regulations and industrial standards the Company actively
carries out inspections on environmental hidden hazards. It conducts detailed checks on links including waste gas
wastewater noise and solid waste disposal in the production process striving to fully identify and rectify all potential
environmental risks. The inspection work is implemented in a thorough and pragmatic manner without omissions or
formalities laying a solid environmental foundation for the Company’s sustainable development.
77 78Sustainability Report 2025
Environmental Monitoring
The Company has established a systematic environmental monitoring mechanism and set up standardized monitoring
points for water air noise and solid waste. It clarifies monitoring indicators frequencies and procedures and adopts
a combined model of self-monitoring and third-party inspection. Online monitoring devices operate networked as re-
quired to ensure monitoring data is authentic and traceable.Meanwhile the Company fulfills its statutory obligations
for environmental information disclosure. It publicly releases environmental information including self-monitoring data
pollutant emissions and environmental governance progress on designated platforms in accordance with regulations
and voluntarily accepts regulatory and public supervision.Emergency Response Management
Case Hazardous Waste Leakage Emergency Response Drill
The Company has established the Emergency Response Plan for Environmental Incidents which addresses risks associ-
ated with storage usage and disposal processes including explosions fires leaks and abnormal emissions. The plan
also covers incidents triggered by natural disasters. A real-time monitoring and early warning system has been imple- In June Jiangshan Factory and Guangxi Factory organized a hazardous waste leakage emergency response
mented to proactively prevent environmental pollution incidents. During the reporting period no environmental viola- drill simulating the scenario of accidental tipping of waste engine oil barrels during loading and unloading op-
tions or pollution events were recorded. erations.The emergency team responded rapidly. It contained the leakage effectively through key procedures
including building sand berms to block diffusion adsorbing and covering pollutants for collection and stand-
ardizing the sealing and packaging of contaminated waste.The drill verified the practicability of emergency
workflows and reserved supplies and greatly improved employees' on-site teamwork and risk disposal capabil-
Emergency Response Leadership Team ities.Emergency Rescue and Medical Aid Logistics Sup-
Response Team Repair Team Team port Team
Loctek Emergency Response Organizational Structure
Case Fire Emergency Drill
On December 15 Loctek invited professional members from the Blue Sky Rescue Team of Yinzhou District
Ningbo to jointly organize a systematic fire safety training and practical emergency drill.Adopting a multi-di- Jiangshan Factory Hazardous Waste
mensional model of theoretical teaching + hands-on operation + scenario simulation the activity effectively Leakage Emergency Response Drill
enhanced employees’ fire safety awareness and emergency response capabilities laying a solid foundation for
consolidating the enterprise’s work safety defense line.Guangxi Factory Hazardous Waste Leak-
Case Analysis Practical Operation age Emergency Response Drill
79 80Sustainability Report 2025
Environmental Metrics and Targets During the reporting period
The Company is committed to resourcing conservation and environmental protection utilizing clean energy improving The sewage treatment station of Binhai Manufacturing Base completed technological
resource recycling and promoting cleaner production methods. These efforts aim to reduce pollutant emissions at the upgrading with its discharged water quality meeting the national Class I wastewater
source prevent environmental accidents and contribute to building a green harmonious and sustainable development standard.environment.In accordance with environmental pro- Monitoring
tection laws regulations and standards Wastewater Type Procedure Disposal Method
implement all environmental protection Continue regular environmental super-
hardware facilities and control meas- vision and inspection increase invest-
ures and strengthen environmental ment in environmental protection and
supervision inspection and penalty fully implement supporting hardware Introduce advanced intelligent integrated wastewater treatment equipment to
enforcement; facilities; Pickling scientifically treat production wastewater. Part of the treated production waste-
wastewater water is recycled and reused to improve water resource utilization efficiency.The
Achieve compliance in comprehensive Achieved Improve the management system cov- silanization remaining wastewater is discharged into the municipal pipe network in compli-
wastewater discharge waste gas and ering the company’s principal person- wastewa- ance with regulations safely delivered to sewage treatment plants for advanced
dust emission noise emission as well as in-charge to environmental protection ter initial treatment and finally discharged only after meeting water quality standards.resource and energy conservation; officers implement the accountabili- rainwater Annual Canteen wastewater undergoes oil separation pretreatment then is treated in
ty system level by level and ensure no production regular septic tanks together with other domestic sewage. It is eventually connected to
Conduct compliant and legal disposal of serious environmental pollution inci- wastewater sampling the municipal pipe network and centrally treated by sewage treatment plants
all wastes; dents occur. and before standard-compliant discharge.testing
Zero major environmental pollution
incidents.Canteen wastewater undergoes oil separation pretreatment then is treated in
Domestic septic tanks together with other domestic sewage. It is eventually connected to
sewage the municipal pipe network and centrally treated by sewage treatment plants
before standard-compliant discharge.Objective 2025 Completion Status 2026 Plan
Key Performance
Pollutant Discharge Management Total Wastewater Discharges Wastewater Discharge Intensity
The Company attaches great importance to pollutant emission management and regards it as a crucial part of prac-
ticing the green development philosophy and fulfilling social responsibilities.As the top-level designer and supervisory 84561tons 12.59 tons/RMB million (revenue)
core of the Company’s pollutant management work the Board of Directors exercises overall coordination over relevant
management affairs and bears ultimate overall accountability.Meanwhile the Company has established an environ-
mental protection leading group led by the General Manager to coordinate and advance all environmental protection
work. It has formulated a pollutant accountability assessment system and incorporated it into the performance ap-
praisal mechanism so as to strengthen the awareness of environmental responsibility among all staff.As the dedicated Air Emissions Management
executive department the Health Safety and Environment (HSE) Department is in charge of the full-process manage-
ment and control of wastewater waste gas and solid waste. It conducts cleaner production in compliance with relevant The Company has formulated the Waste Gas Management Regulations and strengthened waste gas management
standards to ensure the effective implementation of environmental protection rules and regulations.In addition the by installing oil fume purifiers and intensifying daily maintenance of relevant equipment.Major pollutants generated
Company adopts environmentally friendly coatings with nearly zero volatile organic compound (VOC) emissions. By vir- during operation include welding waste gas polishing dust powder coating and curing waste gas (including natural
tue of process innovation waste recycling and reuse improved utilization of circulating water and other measures the gas combustion flue gas) as well as canteen oil fume. All types of waste gas are collected and treated by water spray
Company reduces the generation of the "three wastes" and achieves cleaner production. scrubbers then discharged through a 15-meter-high exhaust stack. Canteen oil fume is processed by oil fume purifiers
and discharged via exhaust stacks above the roof of the canteen building.Wastewater Management During the reporting period
The Company has formulated the Wastewater Management Regulations to standardize wastewater treatment and dis-
charge procedures. It regularly entrusts qualified third-party testing institutions to conduct wastewater monitoring en- All waste gas emissions of the Company fully complied with regulatory standards.suring all sewage is discharged in compliance with relevant standards.
81 82Sustainability Report 2025
Air Emissions Reduction Measures Waste Type Major Waste Products Disposal Measures
Waste wood boards wood Recyclable materials are collected for reuse or sale.Select equipment raw materials and fuels that produce minimal or low levels of air pollutants; General chips waste fabric waste wire
Waste waste metal scraps waste plas- Non-recyclable materials are collected by sanitation departments for
Replace acidic powder coating agents with alkaline alternatives to reduce acidic emissions; tic etc. disposal.Source Minimize the use of gas-shielded welding by implementing alternative techniques such as spot
Control welding and laser welding thus reducing air emissions;
Hazardous waste is stored in a separate compliant temporary storage
Shorten raw material supply cycles to reduce rusting and product defect rates thereby reduc- Hazardous sludge furnace slag area with dedicated management.ing the need for pickling processes and limiting emissions. Hazardous laboratory waste containers Waste waste paint buckets waste glue Transferred to a qualified third-party organization for professional
blocks treatment with treatment records retained.In areas where odors may arise departments implement effective protective measures ensur-
ing proper ventilation and requiring operators to strictly adhere to operational protocols;
Process Key Performance
Control In dust and smoke-generating areas responsible departments implement dust control meas-
ures and operators are provided with protective equipment to minimize dust and smoke gen-
eration and dispersion.Non-hazardous Waste Non-hazardous Waste Disposal Non-hazardous Waste Discharge per
Generation Volume Million Revenue
2154.04 tons 2154.04 tons 0.32 tons/RMB million (revenue)
Hazardous Waste Generation Hazardous Waste Disposal Volume Hazardous Waste Discharge per
Key Performance Million Revenue
229.55 tons 229.55 tons 0.03 tons/RMB million (revenue)
Waste Gas Emissions Waste Gas Emission Intensity
65235.13tons 9.72tons/RMB million (revenue)
Total Recycled & Reused Waste Total Waste Recycling & Reuse per Proportion of Recycled & Reused
Million Revenue Non-hazardous Waste
972.85 tons 0.03 tons/RMB million (revenue) 45.16 %
Waste Management Noise Emissions Management
The Company adheres to the principle of “prevention first integrated prevention and control” in environmental The primary sources of noise within the Company include air compressors punch presses and other similar equipment.protection as well as the “3 In-Parallels” rule (environmental protection facilities must be designed constructed and To manage noise levels the Company has implemented a Noise Control Procedure which outlines the requirements and
commissioned in parallel with the main work). The Company has developed an Environmental Waste Management principles for noise control. During the equipment selection process the company prioritizes the use of environmentally
System Hazardous Waste Management Policy and Hazardous Waste Pollution Control Responsibility System which friendly low-noise screw compressors to reduce noise generation. Regular maintenance of noise-reducing silencers and
clearly define the procedures for waste generation collection storage and disposal to ensure compliance with national vibration dampers is conducted to further minimize noise. Additionally the Company commissions local government
laws and regulations. environmental protection agencies to perform annual noise monitoring to ensure compliance with national industrial
noise emission standards at the factory boundary.In partnership with Zhejiang Province’s solid waste disposal platform the Company has advanced the construction of a
digital hazardous waste warehouse. Each bag of solid waste is assigned a unique QR code enabling real-time tracking
and data management through the Zhejiang Province Solid Waste Management System thereby greatly enhancing the During the reporting period
precision of waste management practices.The Company’s noise emissions were fully compliant with regulatory limits.
83 84Sustainability Report 2025
Energy GovernanceResource Efficiency Loctek upholds the philosophy of “prioritizing energy conservation focusing on efficiency pursuing sustainable development drivenby innovation and advancing overall coordination”. The Company has formulated a series of internal systems such as the Energy Man-
agement Regulations and Energy and Resource Control Procedures. A dedicated functional department is established to implement
regular special management and control. The senior management assumes overall leading responsibilities with a clear division of
Energy Management authority and accountability while the Board of Directors exercises overall coordination and bears ultimate accountability for relevant
management affairs. Meanwhile the Company has set energy management targets. It compiles monthly energy consumption statis-
tics conducts regular inspections and unscheduled random checks on energy usage and incorporates the effectiveness of energy
management into the performance appraisal system for management staff.Energy Strategy
The Company proactively identifies and thoroughly evaluates energy-related risks carefully pinpointing potential vul-
nerabilities. Based on these assessments a range of targeted strategies and measures are employed to ensure robust
and efficient energy management.Potential Risks of Energy Management
Probability of Impact Duration of Risk Category Risk Description Value Chain Priority Financial Impact
Occurrence Magnitude Impact Links Impacted Ranking Description Mitigation Measures
Fluctuating prices for energy sources (e.g. electric- Diversify the energy mix by incorporating renewable sources Energy ity natural gas) could lead to increased production Low Relatively Short and Opera- Relatively Increase in Op-Price such as solar and wind power to reduce dependency on conven-costs impacting profit margins. Low Medium Term tions Low erating Costs tional energy.Low energy efficiency could result in wasted ener- Replace outdated high-energy-consuming equipment with ener-
Energy gy raising production costs. Inefficiency may also Relatively Opera- Increase in Op- gy-efficient models.Efficiency exacerbate environmental impacts misaligning with Low Low Medium Term tions Medium erating Costs Implement regular maintenance to optimize performance and
the goals of green production and sustainability. reduce energy waste.Potential opportunities in energy management
Opportunity
Category Opportunity Description
Probability of Impact Duration of Value Chain Financial Impact Mitigation Measures
Occurrence Magnitude Impact Priority RankingLinks Impacted Description
Green production has become a central focus of cor- Medium Opera- Relatively Reduction Energy Transition porate strategy. The company is transitioning to a more sustainable energy structure increasing the use of re- Medium Medium and Long tions High in Operating
Give priority to the use of new energy work vehicles to replace
traditional fuel vehicles and reduce carbon emissions.newable energy. Term Costs
85 86Sustainability Report 2025
Energy Risk Management Key Performance
The Company employs a comprehensive systematic approach to energy risk management that spans identification
assessment and management. This process ensures a thorough understanding and effective control of energy risks Total Energy Consumption Total Energy Consumption per Million Revenue
promoting the safe efficient use of energy and providing a strong foundation for stable long-term growth. 8081.76 tce 1.20 tons/RMB 1 million (revenue)
Identification Assessment Mitigation Total direct energy consumption Including: Natural Gas
Energy risks are identified Scientific tools and method- Based on the results of risk 4216.28 tce 2.7189 million Nm3
through detailed data col- ologies are used to quantify assessments specific risk
lection and analysis laying and evaluate identified en- management measures are
the groundwork for subse- ergy risks. These risks are implemented. A robust en- Diesel Liquefied Petroleum Gas (LPG)
quent evaluation and man- then prioritized and tailored ergy risk management sys-
agement actions. risk management strategies tem is in place with clear- 11.86 tons 340 tons
are developed. ly defined responsibilities
across departments to en-
sure consistent and effective Total Indirect Energy Consumptio Total Purchased Electricity
management practices.
3865.48 tce 20151771 kWh
Energy Metrics and Targets Purchased Renewable Electricity Photovoltaic Power Generation
The Company formulates energy consumption quotas and target plans based on production schedules and actual 9655213 kWh 1645285 kWh
equipment operating conditions. Relevant indicators are decomposed down to work teams and individual machines
with responsibilities assigned to specific individuals. To standardize management the Company has established an en-
ergy consumption assessment system to supervise all departments and staff in strictly abiding by energy usage stand-
ards further advancing energy conservation and emission reduction initiatives.Note: The purchased renewable electricity comes from wind power generation.Strengthen technological Further advance energy transi- Conduct energy conservation
transformation and equip- tion and raise the proportion of training on an annual basis.ment upgrading and give clean energy utilization;
priority to phasing out equip-
ment with backward produc-
tion capacity;
Energy Targets and Plans
87 88Sustainability Report 2025
Energy Conservation and Emission Reduction Measures Digital Energy Management Platform
The Company has formulated the Energy Conservation and Emission Reduction Management Regulations. It rationally The Company has implemented a digital energy management system to continuously monitor and record energy
utilizes various resources including water electricity coal and oil products and actively carries out energy-saving and consumption in real-time covering electricity water gas and other energy sources. Through comprehensive data col-
emission-reduction initiatives. By adopting multiple measures such as optimizing equipment allocation and upgrading lection and analysis the system supports refined energy management practices and informs the development of ener-
production techniques and workflows the Company cuts down energy consumption and improves energy utilization gy-saving strategies enabling the Company to optimize its energy usage.efficiency.Energy Conservation Measures
Energy Mix The Company has strategically adjusted its energy consumption mix by
Adjustment purchasing green electricity and reducing reliance on non-renewable
resources.The Company has comprehensively upgraded the heating systems of two pow-
der coating and drying production lines and replaced them with oxygen-en-
Technology riched combustion systems. Featuring high efficiency and full combustion per-
Upgrading formance the new systems improve thermal efficiency by 10%-30%. Meanwhile
they effectively reduce emissions of nitrogen oxides (NOx) sulfur oxides (SOx)
and particulate matter achieving superior environmental protection and emis-
sion reduction effects.The Company has carried out technological innovation on the heating system Digital Energy Management System
Technological of pretreatment liquid for the powder coating line abandon the original heat
Improvement and exchange mode of heating water by low-pressure boilers and adopt the pre-
Innovation heating and waste heat recovery method of the drying line to heat the liquid Water Resource Management
medicine.The Company has introduced the Regulations on Rational Use of Heat and Water designed to regulate employee water
consumption promote water conservation awareness and reduce water wastage at the source. This initiative supports
The Company has promoted the integrated transformation of laser welding the sustainable use of water resources and has earned the company recognition as a Water-Efficient Enterprise by both
grinding and inspection and adopted robots for automatic loading and unload- Zhejiang Province and Ningbo City.ing integrate welding and grinding processes and replace manual full inspec-
tion with machine vision. This reduces the need for four operators eliminates
Process misjudgments caused by human eye fatigue improves production capacity and Key Performance
Improvement lowers product manufacturing costs.The Company has implemented the upgrade of the ET156 lead screw gearbox Total Water Consumption Water Consumption Intensity
automatic assembly line reuse the original ET114 lead screw automatic line after
optimization to save equipment manufacturing costs amd adopted vision tech- 253677tons
nology for model selection and assembly to enhance the intelligence level of the 37.78 tons/RMB million (revenue)
production line and increase production capacity.Total Recycled Water Water Recycling and Reuse Rate
The Company has adopted Automated Guided Vehicles (AGVs) and electric fork-
Green lifts for material handling gradually phasing out diesel-powered forklifts. This 31230 tons 12.31%
Transportation shift contributes to significant reductions in diesel consumption and CO? emis-
sions.
89 90Sustainability Report 2025
Water Conservation Measures Hazardous Substance Management
The Company has developed a Hazardous Substance Control Procedure ensuring that all raw materials and products
Water Resources Gradually raise the water recycling rate; entering the supply chain comply with RoHS standards. This helps ensure that products are both environmentally
Targets and Plans Organize water-saving training every year. friendly and safe for human health reinforcing the Company’s commitment to green development. Furthermore the
Company actively participates in the formulation of national standards including GBT 27410-2007-2021 Guidelines for
Chemical Hazard Characterization and Exposure Assessment of Consumer Products helping to drive industry-wide ef-
Introduce new spraying production lines. The pretreatment lines adopt the combined forts to reduce the use of hazardous substances.Technological
innovation process of “immersion + spraying + air blow” drying to reduce overflow of cleaning
water and realize water conservation.Case Chemical Safety Training at Binhai Factory
Pipeline and Focus on the inspection maintenance and renovation of water supply pipelines and facilities. Conduct regular weekly patrols and inspections and replace aging water In December the Binhai Manufacturing Base launched chemical safety Equipment
Maintenance supply pipelines and equipment. Strictly prohibit water leakage seepage and running training. The training offered an in-depth interpretation of the full life cycle
water waste. management of chemicals raising production employees’ awareness of
the safe usage and management of chemical substances. It prevents leak-
Collect rainwater and reuse purified rainwater for scenarios such as rinsing on coat- age and pollution from the source and effectively safeguards ecological
ing lines canteen vegetable washing ground flushing laundry cleaning and staff and environmental safety.bathing; Training Site
Source Reduction
Adopt water supply and consumption systems featuring recycled and cascaded water
utilization to reduce fresh water make-up volume and improve the efficiency of cool- Green Office
ing water systems and other water-consuming facilities.The Company actively practices the green office philosophy and integrates the green strategy of balancing corporate
development and ecological protection into daily operations to foster a sustainable office model.At the end of 2024 the
Water-saving Install water-saving notice boards in office areas carry out water-saving publicity and Company relocated to a new office building. The new building adopts energy-efficient designs in the building envelope
Promotion education and enhance employees’ awareness of water conservation. HVAC systems lighting and other aspects and has established a regular mechanism for energy conservation and con-
sumption reduction. The company monitors analyzes and optimizes the energy consumption of each department every
quarter to implement the green development philosophy.Materials Management Green Office Initiatives
The primary raw materials used in production include raw and auxiliary materials along with packaging materials. Raw Build a green Indoor potted plants are maintained to create an eco-friendly at-
materials consist of cold-rolled steel plastic powders hydrochloric acid degreasing agents neutralizers silane agents office environ- mosphere. The company advocates water and electricity conserva-
ment tion and is equipped with energy-saving intelligent sensor devices.activators liquid oxygen welding wire etc. Packaging materials primarily include plastics and wood.To effectively manage material consumption the Company has formulated the Material Quota Issuance and Requisition Employees are encouraged to use new energy vehicles. New ener-
System based on actual operational conditions. The Board of Directors is responsible for top-level overall planning and gy charging piles have been installed and dedicated parking areas
ultimate accountability while senior management takes charge of the administration of raw materials and packag- Encourage for electric vehicles have been designated to foster an EV-friendly
ing materials. The Materials Department implements full-process supervision and control. By strengthening technical green com- environment.process management and strictly regulating material consumption in production procedures the Company minimizes muting Staff are advised to commute by public transport whenever possi-
waste at the source lowers production costs and improves overall operational efficiency. ble to reduce pollutant emissions from private cars
Promote
paperless Double-sided printing is prioritized and color printing is reduced. Key Performance
office Office supplies are used rationally to cut down on resource waste.Total Packaging Materials used Packaging Material Consumption per
Million Revenue
3114 0.46 Implement Online document transmission is adopted via platforms including tons tons/RMB million (revenue) digital office the OA system WeCom and Lark so as to reduce paper usage.
Cartons Plastic Packaging Materials
2558 556 Arrange waste Four-color classified waste bins with clear labels are placed across tons tons sorting bins the premises to facilitate standardized waste sorting by employees.
Practice Green Office
91 92Sustainability Report 2025
R&D Quality: Driving
Sustainable Development
Through Innovation
Company Actions
R&D System Construction
Advance New Quality Productive Forces
Intellectual Property Protection
Product Quality Assurance
Quality Service
Sustainable Supply Chain
SDGs
93 94Sustainability Report 2025
R&D System Construction R&D Team
Guided by our focus on “Intelligent Integrated and Green” technologies we have assembled a multidisciplinary R&D
R&D Governance team with deep expertise in mechatronic systems embedded software and hardware and IoT architecture design.With the vision of “becoming a future-ready enterprise that serves society through technology and innovation” As of the end of the reporting period
Loctek has established a scientific and standardized R&D innovation framework. We have developed key internal
systems including the Project Management Policy Design Management Procedures Product Certification Process and
New Product Pilot Run and Launch Procedures which enable end-to-end control over the development process. This Loctek employed 964 R&D professionals—24.26% of our total workforce—
integrated system ensures standardized compliant product development and facilitates the seamless transition from with 86% holding a bachelor’s degree or higher.R&D to mass production. Our development cycle follows a closed-loop process of Needs Identification – Innovative
R&D – Compliance Certification – Mass Production continuously enhancing our technological competitiveness.Key Performance
Expenditure R&D Investment as Percent- 11 101 17
(million) age of Operating Revenue (%) 76
During the reporting period 135213.17
200381
201.13
total R&D expenditure reached 160.61
150
RMB 213.1734 million
100
4.12%3.17%
representing 50 3.55% 742 465
3.17% of total revenue. 0 Doctoral Degree Master’s Degree Under 30 years old (exclusive of 30)
202320242025
Bachelor’s Degree Below Associate’s degree 30-40 years old (inclusive of 30 and exclusive of 40)
We remain committed to maintaining a high level of R&D investment to support 40-50 years old (inclusive of 40 and
sustained innovation. exclusive of 50)
214 50 (and above) years old
Innovation Incentives
To spark innovation and encourage employee engagement
we have implemented a comprehensive incentive system
including the Project Development Incentive Policy. Our dual-track
“Innovation + Growth” model features both short-term rewards—
such as project bonuses patent incentives quarterly performance 750
bonuses and annual awards—and long-term incentives like equity
plans and housing support schemes. These mechanisms foster
a strong innovation culture and provide long-term development Male Female
pathways for R&D talent.Person of the Year Awards
During the reporting period Ethics in Science and Technology
we distributed R&D-related bonuses totaling RMB 36590000 a total of We strictly adhere to ethical standards in science and technology during our innovation efforts in high-performance
123 34 14 computing artificial intelligence and big data. We uphold scientific integrity prioritize human-centered values and employees were commended were promoted and were granted guard against misuse of technology. No violations of technology ethics or penalties by regulatory bodies were reported
equity and stock option incentives. during the reporting period.
95 96Sustainability Report 2025
R&D Strategy
Guided by our core principles of “Innovation as the soul Quality as the foundation and Talent as the driver” Loctek
has established a world-class innovation center focused on linear motion and AI-interaction technologies for the smart
home sector. Our goal is to lead the market through cutting-edge solutions deliver high-quality products and services
and continuously advance through the development of a highly skilled workforce.Potential Risks of Innovative R&D
Risk Description Probability of Impact Magni- Duration of Value Chain Priority Financial Impact Risk Category Occurrence tude Impact Links Impacted Ranking Description Mitigation Measures
R&D Department reviews project proposals and supporting
Insufficient feasibility assessment of R&D pro- Down- documentation;
Risk Category jects may lead to high costs fraud or project Medium Relatively Short and Increase in Operat-
failure. High Medium Term
stream Medium
Operation ing Costs Approval through project review meetings;
Budget control by project managers
Increase in Operat-
Down- Require patent filings to be reviewed by the IP Department;ing Costs
IP Risk Failure to file patents in time or IP infringe- Relatively ments may result in product delisting. Medium High Short Term stream MediumOperation Decrease in Operat-
Assign dedicated personnel to proactively assess and mitigate
ing Revenue IP risks.Potential Opportunities for Innovative R&D
Opportunity Opportunity Description Probability of Impact Magni- Duration of Value Chain Priority Financial Impact
Category Occurrence tude Impact Links Impacted Ranking Description Mitigation Measures
As people’s pursuit of a healthy lifestyle and
demand for improved office environments
continue to grow the company’s focus areas—
such as linear drive technology smart home upstream Proactively seek cross-industry collaborations to co-de-Market
opportunity solutions and healthy office solutions—are Medium
Relatively Medium and Relatively Increase in
facing vast market opportunities. This provides High Long Term
operations High Operating Revenue velop new technologies and products through resource downstream sharing and synergy
the company with significant opportunities to
continuously innovate and expand its product
lines to meet market demand.
97 98Sustainability Report 2025
R&D Risk Management R&D Metrics and Targets
To support the healthy development of research and innovation the Company continues to refine a dual-prevention The Company regards R&D as a core strategic pillar. Based on thorough market research and technical analysis we
mechanism based on risk classification and hazard identification. Following a structured risk management process we have formulated a comprehensive long-term innovation roadmap. This roadmap is translated into clear actionable
conduct in-depth identification and assessment of R&D risks and implement targeted mitigation measures. annual goals enabling effective tracking of R&D progress and ongoing refinement of innovation strategies.Objective 2025 Completion Status
Project Design Verification Phase Development & Market Achieve leading industry benchmarks
Initiation Phase Pilot Production Phase Launch Phase in product efficiency and power den- Number of launched projects: A total of 730 projects were ini-
sity; tiated in 2025 driving product iteration and supporting market
Commercial Risk Technology expansion；Rank among the top in the number of
Technical Risk authorized patents. Innovation patents: 282 patents were drafted in 2025.Expand the R&D talent pool;
Design &
Develop- Increase the proportion of top-tier
ment Talent De- industry experts; In 2025 the Company integrated R&D resources and stream-Target Market velopment Enhance campus recruitment efforts lined its R&D team to better align with new research and devel-Selection Product with a focus on graduates from Dou- opment demands.Concept ble First-Class universities and post-
User Persona graduate programs.Concept
Business Re- Verification
quirements Drawing
Review Build an innovation and research plat-
In 2025 the Company recruited one doctoral professional and
form. built a scientific research and innovation platform featuring one Initial Concept institute two stations and five centers.Sample
Key Technology Review Sample Tri- Resource
Feasibility NUDD Re- al Produc- Manage-Low-vol- The company has carried out industry-university-research co-
view etc. tion ume Pilot Market ment Strengthen industry-university-re- operation with multiple universities including Zhejiang Univer-
Production Validation search collaboration; sity Ningbo University Northwestern Polytechnical University Product Risk
Assessment Expand research infrastructure and University of Electronic Science and Technology of China Xidian
tools including laboratory equipment University Hangzhou Dianzi University China University of Min-
and software systems. ing and Technology and Chongqing University jointly launching
several collaborative projects.R&D Risk Node Setting
99100
Manual Prototyping
Structural Design
Industrial DesignSustainability Report 2025
Advancing New Quality Productive Forces Industry-University-Research Collaboration
The Company has jointly established the Loctek Robotics Research Institute (hereinafter referred to as “the Institute”)
R&D and Innovation Platforms with local governments and well-known universities to conduct joint technological research and tackle key technical
challenges accelerating technological innovation.The Institute adopts an R&D model of professor guidance engineer
The Company is at the forefront of the industry in technological innovation owning a number of world-original implementation and professional master’s participation. It assembles high-caliber talents including professors PhDs
technologies in the field of linear drive. It has successively established a host of scientific research platforms including full-time engineers postdoctoral researchers and professional master’s students from Ningbo’s universities. The
the National Enterprise Technology Center National Industrial Design Center National Postdoctoral Research Institute focuses on research and development in artificial intelligence intelligent manufacturing and other key fields.Workstation China Light Industry Engineering Technology Research Center Provincial Key Enterprise Research Institute In the meantime it carries out industry-university-research cooperation with institutions of higher learning to advance
Provincial Enterprise Technology Center Provincial Doctoral Innovation Station and Provincial High-tech Enterprise technological preliminary research and key technical breakthroughs continuously enhancing the Company’s capacity
R&D Center.Widely recognized by national authorities the industry and the market the Company advances the in- for scientific and technological innovation.depth integration of scientific research and production delivering lasting technological support and innovation impetus
for its sustainable development.Key Performance Partner Institution Collaborative Project
As of the end of the reporting period With China University of Mining and To launch the project entitled Research and
the Company has boasted Nationally Accredited Enterprise Technology & Power System Research Application of Key Technologies for High-
Technology Center Institute China Electric Power Research efficiency and High-power-density Integrated
3 1 Institute PV-Energy Storage Converters with Grid National High-tech Enterprises Support Function
Postdoctoral Research Workstation enterprise certified as a Specialized Refined Characteristic and Innovative Enterprise.
1 1 Case Renowned Teachers from Ningbo Vocational Colleges Visit Loctek to Write a New Chapter of Industry-Education Integration
R&D Honors In August the Ningbo Municipal Bureau of Education organized a delegation of distinguished teachers from
higher vocational colleges to visit the headquarters of Loctek Motion Co. Ltd. They held in-depth exchanges
with representatives of Zhejiang Craftsmen and members of the Model Worker Innovation Studio. By sharing
Award Name Issuing Authority their personal growth experiences the representatives vividly interpreted the essence of the craftsman spirit
within corporate development.The event successfully built a bridge for communication between schools and
2025 Zhejiang Provincial First Set of Major Equipment Zhejiang Provincial Department of Economy
enterprises displayed Loctek’s achievements in technological innovation and independent evaluation of high-
and Information Technology skilled talents and jointly explored new paths to integrate the craftsman spirit into vocational education.
2025 Advanced Smart Factory Ningbo Municipal Bureau of Economy and Information Technology
Ningbo Municipal Industry-Education Integration Enterprise Ningbo Municipal Development and Reform Commission
Excellent Rating in the 2025 Annual Evaluation of Ningbo Man- Ningbo Municipal Bureau of Economy and
ufacturing “Large Excellent & Strong (Cultivation)” Enterprises Information Technology
Included in Ningbo Key Open Source Project Ningbo Municipal Bureau of Economy and
Cultivation Library Information Technology
Visit to the Corporate Exhibition Hall Lecture on the Zhejiang Craftsman Spirit
Second Prize of Ningbo Municipal Science and Technology Ningbo Municipal Science and Technology
Progress Award Bureau
101 102Sustainability Report 2025
Innovation and R&D Achievements Leading Industry Development
The Company upholds the philosophy of being driven by technology innovation and efficiency. Leveraging the
strengths of its seasoned R&D team it initiated a total of 407 R&D projects in 2025 making comprehensive progress As a pioneer in the smart lifting home furnishing industry Loctek actively promotes the innovative application of smart
across manufacturing logistics warehousing intelligent lifting and other fields. Among these projects 244 have been lifting technologies in the fields of healthy office and smart home. The Company has joined the National Technical
completed and 168 are currently ongoing. Committee for Furniture Standardization as an observer member. During the reporting period Loctek participated in
the formulation of a number of national and industrial standards. Five national standards jointly drafted by the company
were officially released in 2025 namely:GB/T 45231-2025 Smart Beds GB/T 46025-2025 Household Wheelchair Beds；
Achievements of R&D and Innovation (Selected): GB/T 46489-2025 General Technical Requirements for Hospital Furniture；GB/T 46260-2025 Evaluation and Labeling of
Intelligent Grades for Furniture；GB/T 10357.7-2025 Furniture Mechanical Performance Tests — Part 7: Stability of Ta-
As the “heart” of the lifting system the intelligent linear actuator has made breakthroughs in key bles.Independent R&D of technologies delivering precision drive low noise long service life and high load capacity. It has
Core Technologies broken foreign technological monopolies enhanced the independent controllability of the industrial As of the end of the reporting period
chain and provided core technical support for industries including smart homes and healthy offices.The Company has cumulatively presided over or participated in the formulation and
Enhanced Export Technological empowerment raises product added value strengthens international brand influence
Competitiveness and facilitates the global expansion of Chinese smart manufacturing. revision of 13 national and industrial standards among which 11 have been
Serving a Better Life It drives the popularization of healthy offices. Intelligent height-adjustable equipment alleviates
promulgated and implemented.for the Public cervical and lumbar problems caused by prolonged sitting reduces the incidence of occupational diseases and improves the quality of life of office workers teenagers and home-based workers.Conservation and Building an Intelligent Factory for Linear Drive
Consumption Re- High-efficiency motors and intelligent power management lower standby energy consumption
duction complying with the green and low-carbon development trend. The Company is committed to constructing an industry-leading intelligent factory for linear drive products. It has a
professional automation team that independently develops modern production lines and manufacturing equipment
and actively advances the in-depth integration of industrial engineering quality control automation and information
technology in production.Equipped with an industry-leading testing system the Company achieves full in-house man-
Product Innovation Honors ufacturing of core components with a high level of automation in the production processes of key parts. This provides
a solid guarantee for maintaining consistent high product quality standards. During the reporting period the Company
was honored as the 2025 Advanced Smart Factory.
2025 MUSE Design 2025 Good Design 2025 Good Design 2025 New York Product De-
Awards Gold Winner Award Gold Award Award Bronze Award sign Awards Silver Winner
SMT Production Line Motor Production Line
2025 International 2025 International 2025 German Innova- 2025 IGR Ergonomic
Design Awards (IDA) Design Awards (IDA) tion Award Nominee Innovation Award
Gold Winner Honorable Mention
Automated Laser Cutting Cluster Intelligent Stereo Warehousing System
103 104Sustainability Report 2025
Intellectual Property Protection Domestic Intellectual Property Portfolio
Category Unit Cumulative Ap- Approved Quantity proved Quantity in 2025
The Company approaches intellectual property (IP) protection from a
strategic business perspective integrating it into core operations. It has Invention
established a comprehensive IP management system supported by Patents Piece 147 35
internal policies including the Intellectual Property Management Policy IP
Incentives and Penalties Policy and Patent Management Policy. The system
was first certified in 2015 and recertified in 2025 ensuring its continued Patents Utility Model Piece 535 86
effectiveness. To embed IP protection across the product lifecycle the Patents
Company has established a dedicated IP department and integrated IP
processes into its PLM (Product Lifecycle Management) system. This
Design Patents Piece 459 95
ensures that IP protection measures are implemented across every stage—
from market research and product design to procurement manufacturing
brand marketing and market operations. During the reporting period the Trademarks Piece 495 28
Company obtained intellectual property management system certification. Intellectual Property Management
System Certificate
Copyrights Piece 44 1
Loctek’s Full-Lifecycle IP Management Framework
Software Copyrights Piece 142 6
Business Ac- Market Re- Product Design & Manufactur- Brand Market- Market Op-
tivity search R&D Procurement ing ing erations
International Intellectual Property Portfolio
IP-Related Redundant Inadequate pro- Improper use Quality-re-
Business Risk R&D tection/Product
Component Equipment of promotional lated legal Cumulative Ap- Approved Quantity
infringement infringement infringement materials risks Category Unit proved Quantity in 2025
Overseas Patents Piece 128 23
IP Manage- Prior art Patent land- Risk assess- Risk assess- Resolution
ment Meas- searches/ scape planning/ ments of ments of Compliance of IP-relat- Overseas Trademarks Piece 427 45
ures Patent analysis Design-around strategies material IP equipment IP
reviews ed quality
issues
Key Performance Metrics
As of the end of the reporting period
1269 239 The number of valid patents is The number of software copyrights isThe Company has held a total of valid authorized patents including
0.19per million yuan of operating revenue 0.02per million yuan of operating revenue
patents granted in 2025. Its patent holdings rank among the top 11 in Ningbo.Note: The data is sourced from the PatSnap Patent Database.
105 106Sustainability Report 2025
IP Protection Measures Product Quality Assurance
The Company attaches great importance to building its intellectual property (IP) talent team. It currently has 13 full-
time IP staff among whom 10 hold patent agent qualifications or legal professional qualifications.The Company has
embedded the IP management system into the PLM (Product Lifecycle Management) system. It files applications Product Quality and Service Governance
for patents trademarks and copyrights in a timely manner keeps detailed ledgers to monitor application progress
and validity periods and purchases insurance related to intellectual property rights. Prior to patent application and
product launch it conducts patent retrieval and new product research. For major projects third-party institutions Upholding the quality policy of “Striving for Perfection Pursuing Excellence” Loctek Motion has formulated internal
are commissioned to carry out supplementary retrieval so as to lower the risk of intellectual property infringement. quality management systems such as the Management Manual and Production Process Control Procedure and
The Company regularly organizes IP training activities. Through multi-channel and diversified training mechanisms it established a full-scale quality management model. The Company carries out product quality control from four
continuously improves the theoretical knowledge and practical capabilities of the IP talent team popularizes intellectual dimensions: finance market internal operation and learning & growth ensuring product quality complies with
property knowledge and strengthens awareness of IP protection. relevant standards customer requirements as well as applicable laws and regulations. During the reporting period the
Company obtained ISO 9001 Quality Management System Certification and ISO 17025 Laboratory Accreditation. It also
passed multiple international product certifications including US EPA European FSC EUDRUL ETL CE and RoHS.During the reporting period
the Company arranged 13 training sessions on intellectual property and patents with a
total training duration of 22 hours.In addition the Company has formulated a
contingency plan for patent infringement. In the
event of infringement litigation and other related
incidents an emergency team composed of the
Intellectual Property Department R&D Department
Legal Department and business departments will
be established to minimize the Company’s losses. Three-Dimensional Quality Manage- ISO 9001 Quality Management
ment Model System Certificate
Quality Management Organizational Structure
The Company has set up a quality organizational structure featuring well-defined responsibilities and efficient
collaborative mechanisms to guarantee the overall stability of product quality. From the perspective of corporate
strategic development the Board of Directors undertakes top-level overall planning and provides fundamental
guarantee for quality management.The senior management assumes specific leadership duties for product quality
Intellectual Property Training management translates the strategic principles formulated by the Board into practical management initiatives and
coordinates work across all departments. Every department is staffed with internal auditors for the quality management
system who are responsible for developing the quality management system within their own departments organizing
training and advocacy on system procedures overseeing implementation and further strengthening product quality
management.Quality Center
Supplier Process Quality Quality New Product Customer Quali- Testing
Quality De- Department Management Quality ty Department
partment Department Department
Center
Quality Management Organizational Structure
107 108Sustainability Report 2025
Product Quality and Service StrategyThe Company is committed to a quality strategy grounded in the principles of “ensuring product and service excellencemeeting customer expectations enhancing competitiveness and driving sustainable growth”. By leveraging advanced
process control methodologies we implement precise management across all operational stages. Regular internal
reviews and continuous improvement practices are adopted to minimize risk boost operational efficiency and instill a
company-wide culture of “quality starts with me”. These efforts serve to elevate product and service standards across
the board and position the Company as a leader in delivering superior quality within the industry.Potential Opportunities for Product Quality and Services
Risk Category Risk Description
Probability of Impact Magni- Duration of Value Chain Priority Financial Impact
Occurrence tude Impact Links Impacted Ranking Description Mitigation Measures
Poor product quality may harm the interests of Increase in Operating Enforce strict oversight and control of production processes to
Quality Risk consumers and trigger risks such as customer Relatively Medium and
Down- Rela- Costs ensure adherence to quality standards;
complaints order cancellations and contract Low High Long Term stream tively Operation High Decrease in Operat- Continuously enhance product design based on customer feed-termination. ing Revenue back and market insights to improve functionality and durability.Failure of product quality to comply with the
laws and regulations of the destination coun- Strengthen quality inspection and real-time monitoring to ensure
Reputational try may lead to product recalls removal from Relatively Medium and Down- Rela- Decrease in Operat- compliance with internal standards;
Risk shelves and other consequences which in Low High Long Term stream tively ing Revenueturn cause customer complaints or reduced Operation High Enhance customization and personalization of products and ser-
satisfaction and damage the company’s brand vices to better align with client needs.reputation.Potential Risks of Product Quality and Services
Opportunity Opportunity Description Probability of Impact Magni- Duration of Value Chain Priority Financial Impact
Category Occurrence tude Impact Links Impacted Ranking Description Mitigation Measures
The global smart home market continues to
Market Oppor- grow offering vast market potential and devel- Medium Relatively Medium and Upstream Relatively Increase in Operat-
We are committed to enhancing product quality to precisely
tunity opment opportunities for the company’s smart High Long Term Operations High ing Revenue meet consumers’ growing demand for high-quality smart
home products. home products.
109 110Sustainability Report 2025
Product Quality and Service Risk Management Product and Service Metrics and Targets
The Company has issued the Technical Manual for Quality Risk Management. By fully taking into account its opera- Guided by the quality policy of “pursuing excellence through continuous improvement” the Company has established
tion and management environment internal and external factors as well as the needs and expectations of relevant clear quality management objectives to drive overall improvements in product and service standards.stakeholders the Company identifies targeted risks and opportunities classifies risk levels via evaluation formulates
response strategies and establishes a monitoring mechanism to report risk dynamics in real time ensuring timely ad-
justment of management policies.Quality Management Objectives 2025 Achievement 2026 Plan
During the reporting period
The Company carried out 165 quality risk assessments and 2 annual internal quality audits. Product Qualification Rate ≥ 99% Achieved Continuous improvement
72 Customer Satisfaction Score ≥ 90 points Achieved Continuous improvementIn 2025 the Quality Department organized the R&D and Engineering teams to complete FMEA analyses
compiled a total of 1584 design experience entries and identified 362 defects in new products
which effectively guaranteed the design and production quality of new products. Timely Handling Rate of Customer Com-
plaints 100% Achieved Continuous improvement
Quality Improvement Measures
Risk Identify operational risks (e.g. regulatory compliance raw material volatility) Loctek always focuses on customer needs. It realizes full-process quality control by virtue of rigorous rules and regula-
Identification through internal reviews technical analysis and expert consultation; Maintain a tions refined management and considerate services and continuously improves the overall quality management capa-
categorized risk register to inform follow-up actions. bility. The Company actively takes part in various competitions and activities held by the China Quality Inspection Asso-
ciation China Quality Research Institute China Quality Club and other institutions and practices quality improvement
through concrete actions. During the reporting period the Company was awarded honorary titles including National
Enterprise with Integrity Commitment to Product and Service Quality National Product with Stable Qualified Quality In-
spection and 2025 National Quality Month Integrity Initiative Enterprise.Risk Evaluate the severity and urgency of risks to provide a data-driven basis for mitigation
Assessment strategies and resource allocation.Risk Develop targeted mitigation plans including quality system enhancements and
Mitigation process optimizations to reduce the impact of identified risks on product quality.Establish real-time quality monitoring through digital and intelligent systems to facilitate
Risk Monitoring dynamic process adjustments;
& Reporting National Enterprise with Integri- Nationwide Stable Qualified 2025 National Quality Month Quality
Provide regular updates to senior management on risk trends mitigation progress and ty Commitment to Product and Product in Quality Inspection Integrity Initiative Enterprise
effectiveness ensuring strategies remain aligned with evolving risk landscapes. Service Quality
111 112Sustainability Report 2025
Key Performance Quality Management Measures
Full-Process Quality Management Framework Quality Control Across the Supply Chain
During the reporting the Company achieved a
period product pass rate o
99.32 Developed a Quality Management Policy Manual Follows the principle of “Check Review % 42 procedural documents and 72 management Improve Approve Implement” and estab-
workflows; lished an Incoming Inspection Control Pro-
cedure to standardize supplier onboarding;
Covers international laws and regulations na-
tional standards and industry standards (over 160 Adopts inspection standards from Fortune
commissioned documents) with a total of 7550 SIP documents 500 export clients and integrates them into
26 for parts manufacturing processes and finished internal quality benchmarks;third-party quality audits. products to guide inspectors in their operations; Implements QR code-based product trace-
Applies advanced digital quality management ability enabling component-level tracking
tools—including DOE QFD SPC MSA NUDD and efficient after-sales response through
and 8D—across the entire product lifecycle from a robust RMA system.design to manufacturing;
Introduced the FMEA system with standardized
protocols to support the digital transformation of
CNAS National Laboratory quality data and analytics.Accreditation Certificate
Product Quality Lifecycle Management
Development Phase: Implements the New Product Pilot Production Control Procedure incorporating analysis
techniques focused on structure functionality failure modes and risk to ensure design validation;
Production Phase: Applies the Production Process Control Procedure to ensure operational consistency with
timeline cost and quality benchmarks while maintaining traceability through product identification;
Inspection Phase: Follows the Finished Product Inspection Control Procedure to prevent the use or delivery of
non-conforming products. The Company operates Asia’s first GS- and UL-accredited witnessed laboratory
equipped with industry-leading instruments and certified by the CNAS (China National Accreditation
Service). Its lab is capable of performing 117 types of tests 53 of which are CNAS-accredited;
Non-Conformance Control: Enforces a comprehensive Non-Conforming Product Control Procedure which
outlines protocols for identification labeling documentation isolation evaluation and disposal of non-
conforming items at all stages—from raw materials and semi-finished goods to final products and post-
delivery handling.
113 114Sustainability Report 2025
Quality Culture Construction Product Recall Management
The company focuses on product quality and service externally and attaches great importance to internal quality train-
ing and publicity. By launching activities such as Quality Month campaigns and knowledge contests it provides multiple To uphold product quality standards and safeguard customer interests the Company has implemented the
professional and customized training sessions for all personnel within the quality management system. This ensures Nonconforming Product Control Procedure and the Product Recall Management Procedure. These protocols ensure that
that relevant employees stay updated on changes to external regulations and quality standards and acquire necessary any defective products are addressed promptly through corrective actions such as issuing safety notices revising user
professional skills and literacy thereby guaranteeing the effective operation of the quality management system. instructions returning exchanging repairing or disposing of affected products. During the reporting period there were
no product recall incidents related to health or safety concerns.Key Performance Indicators
During the reporting period
As of the end of the reporting period the Company held 95 quality-related training sessions attract-
ing a total of 950 participant-times with the cumulative training duration exceeding 170 hours. There were no product recall incidents related to health or safety concerns.The Company has carried out QCC quality improvement activities for four consecutive years. In 2025 its four regional
factories launched a total of 190 QCC quality improvement projects representing a year-on-year increase of 47.3%. The
benefits generated by quality improvement reached 4.867 million yuan a year-on-year growth of 50.3%. Among these
projects 5 outstanding entries won awards in the national and Zhejiang Provincial Case Improvement Competitions.Externally the company prioritizes product quality and services; internally it places great emphasis on quality training and
promotion. By holding Quality Month events knowledge competitions and other activities the Company provides multiple Information Investigation Result Recall
professional and customized training programs for all personnel covered by the quality system. This ensures employees Feedback and Analysis Evaluation Approval
to keep abreast of updates to external regulations and quality standards and equip themselves with requisite professional
skills and comprehensive competence and sustain the effective operation of the quality management system. These efforts
strongly support factory cost reduction and efficiency enhancement and drive the steady improvement of product quality.Year Number of Approved Project Benefits (RMB million) Recall Plan
Improvement Projects
20231067.42
2024 129 3.24 Recalled
Record Product Product Recall Plan
2025 190 4.87 Ledger Handling and Recall Approval
Improvement
Case Typical Case of Quality & Process Improvement
In January Loctek took part in the 11th 2025 “Congmai Cup” Enterprise Improvement Case Competition and Product Recall Process
won the third prize.To further strengthen emergency response capabilities particularly in managing potentially non-compliant products
delivered to customers the Company has enhanced its recall protocols. This includes robust traceability mechanisms—
such as comprehensive purchase and sales records and product QR code tracking—to ensure full product traceability
throughout the supply chain.During the reporting period
The Company conducted a simulated emergency drill to test its product recall response system.The 11th Enterprise Improvement Won the Third Prize of the 11th Congmai Cup
Case Competition 2025 Enterprise Improvement Case Competition
115 116Sustainability Report 2025
Quality Service Pre-SalesCustomer Online Identify Customer Inquiry Follow the Pre-Sales Resolved Closed
Inquiry Support Intent Service Procedure Loop
Customer Service Management After-Sales
Inquiry Unresolved
Loctek Corp. upholds the principle of “Customer First” and has formulated the Customer Service Manual Domestic
Sales Service Department Management Regulations and Domestic Sales Service Requirements Standards providing
Transfer to Af-
standardized guidelines for customer service work.The Board of Directors sets the overall direction and provides 400 Hotline ter-Sales Team
fundamental guarantee from a strategic perspective. The senior management translates corporate strategies into
implementation plans and coordinates resource allocation for practical execution.The Customer Service Center clarifies
job responsibilities business processes and service standards for customer service staff. It has built an information Unresolved
management system to record customer demands and regularly summarizes relevant data to optimize service quality.In
addition the Company adopts strict management over distributors by issuing the Distributor Management Regulations
and signing formal cooperation agreements. These efforts improve the overall customer service and management level Identify Cus- Follow the After-Sales Unresolved Escalate to Resolved Closed
enhance customer brand loyalty and the sustainability of market development and safeguard the overall quality of the tomer Intent & Service Standards & Team Leader Resolve Issues Escalation Protocol for Follow-Up Loop
Company’s sales management system.Resolved
Resolved Unresolved
Customer Service Department
Organizational Structure
Escalate to Su-
Closed Loop Closed Loop pervisor for Final
Resolution
Pre-Sales Team After-Sales Team General Support Team
Closed Loop
Customer Complaint
Tmall JD.com Douyin(TikTok in 400 Hotline Quality Offline Response Processoverseas markets) Training Services
Customer Service Department Organizational Structure
Enhancing Customer Satisfaction
Enhancing Customer Service Capabilities
Loctek is committed to a “customer-centric” philosophy and has established a Customer Satisfaction Survey
Handling Customer Complaints Management Procedure. The company collects feedback through questionnaires sales center interviews and in-
person visits focusing on product quality reliability professionalism service attitude and response speed. Customer
To ensure timely and effective resolution of customer issues the Company has implemented a formal Customer satisfaction surveys are distributed and collected annually with results used to develop product-specific improvement
Complaint Handling Procedure offering multiple complaint channels—including a dedicated hotline online submissions plans and monitor complaint rates for new products to ensure a better customer experience post-market launch.and written or verbal feedback. All customer complaints must receive an initial response within 24 hours. A dedicated
complaint resolution team is responsible for evaluating the severity of each case conducting root cause analysis and
proposing corrective actions. The process ensures all complaints are addressed within 72 hours with resolution updates During the reporting period
provided to the relevant departments.During the reporting period The Company achieved 95% online platform customer satisfaction and 100%
on-time resolution of customer complaints which were above the industry average.The Company received 9327 customer complaints equivalent to 1.39 complaints
per million yuan of operating revenue with a customer complaint resolution rate of 100%.
117 118Sustainability Report 2025
Completed within 10 Completed within 1
Completed within 2 working days working days working day Protection of Customers' Physical and Mental Health
The Company always puts customers’ physical and mental health in an important position and fully integrates the
Initiate Collect philosophy of health care into every link of product design production sales and services.In practice the Company
Customer Customer Verify Data
Satisfaction Information Compilation actively promotes the popularization of healthy office lifestyles. Its intelligent height-adjustable products ease cervical Satisfaction
Survey Feedback and lumbar discomfort caused by prolonged sitting lower the incidence of occupational diseases and improve the
quality of life for office workers teenagers and home workers.Meanwhile to fully ensure product safety in use the
Company clearly states precautions in the user manuals of all products enabling customers to use the products safely
and securely.Responsible Marketing
Archiving Satisfaction Data Data
and Closure Improvement Validation Validation
Loctek has adopted the Internal Compliance Guidelines for Marketing which strictly prohibit false advertising and
misleading consumer practices. Regular training is provided to promote responsible marketing behavior and uphold fair
competition supporting sustainable growth and long-term success.Improvement initiatives to be devel- Completed within 3
oped within 3 working days working days
Satisfaction Survey & Improvement Process During the reporting period
The Company held 17 responsible marketing training sessions engaging 488
Targets 2025 Progress 2026 Progress
participants and delivering 26 hours of training.
100% on-time resolution of customer complaints 100% Maintain the status quo
Online platform satisfaction (score out of 100) 95 Points Maintain the status quo
Product Marketing
Customer Service Training The Company continues to strengthen channel development and build a diversified marketing framework covering
domestic and overseas businesses as well as online and offline multi-format channels.The Company has built a professional customer service team. Tailored to the characteristics of new and senior
employees it provides targeted special training covering product knowledge communication skills complaint handling During the reporting period
procedures emergency response and other modules. Quarterly intensive training and performance assessments are
also arranged to consolidate and improve training outcomes. Meanwhile the Company continuously optimizes the
after-sales service process enhances customer experience via high-quality services and strengthens brand influence. FlexiSpot a brand under Loctek Corp. adopted a multi-channel and localized integrated
marketing model to engage users in European and American markets via a three-dimensional
communication matrix. In Europe the brand placed advertisements on trams subways and
Key Performance Indicators outdoor billboards in Germany Spain France and the United Kingdom to amplify brand exposure.The Company also established targeted cooperation with top German podcasters and Dutch
technology forums driving efficient user conversion and brand popularity growth through
During the reporting period the Company held 5 special training sessions on customer complaint content marketing.In addition the Company’s Chairman shares business insights through the
response with a total of 131 participants and an overall training duration of 7 hours. domestic new media account Chairman Shaw of Loctek which has amassed over 3.5 million
followers. It delivers brand values realizes coordinated online-offline marketing synergy at home
and abroad and continuously enhances brand influence and market penetration.
119 120Sustainability Report 2025
Case FlexiSpot Attains Efficient User Conversion through Top-tier Podcasts in the German Market
In May FlexiSpot entered a targeted cooperation with unfassbar a top 5 well-known podcast on
Spotify in Germany. By embedding product information naturally into podcast episodes the brand
effectively reached high-quality audiences focused on health and tech products. One month after
the podcast was released it brought considerable brand exposure and directly generated sales of
16000 US dollars. The collaboration realized efficient brand penetration and precise acquisition of
target customers.Tram Advertisements in Germany Offline Advertisements in Spain
Case Chairman Shaw’s Insights of Loctek
In the spirit of altruism Mr. Lane Shaw
Chairman of Loctek shares his en-
trepreneurial experience corporate
Offline Advertisements in France London Underground Advertisements in the UK management wisdom cross-border
e-commerce insights and other pro-
fessional business viewpoints via his
official Douyin account Chairman
Case FlexiSpot Achieves Dual Breakthroughs in Brand Awareness and Sales via Tweakers in the Dutch Market Shaw of Loctek. The account aims to
spread professional knowledge and
convey the brand’s core values. As of
In November FlexiSpot a brand of Loctek partnered with Tweakers the largest technology forum the end of the reporting period the
in the Netherlands. It released featured articles and launched questionnaire lottery campaigns. The account has gained over 3.5 million
content gained 17000 views and 468 comments within a week. Statistics indicated that around followers and released more than
90% of commenting users had never bought the brand’s products and nearly 60% of them had no 1000 original works. It was honored as
prior understanding of the brand. The campaign drove a substantial increase in sales successfully one of the Top 20 Most Influential New
converting platform influence into tangible growth in brand awareness and revenue. Media Accounts in Ningbo on Douyin
in 2024.
121 122Sustainability Report 2025
Sustainable Supply Chain Supplier Hierarchical Management and Exit Mechanism
Loctek has established supplier evaluation criteria covering multiple dimensions including quality SQE assessment
Supplier Governance technology and procurement. Quarterly reviews are conducted to classify suppliers into four grades: A B C and D.For high-performance Grade A and B suppliers the company increases order allocation. For Grade C and D suppliers one-
on-one improvement support programs are implemented. Underperforming suppliers receive targeted coaching and
Loctek upholds the philosophy of sustainable development and promotes supply chain management in accordance follow-up monitoring; those failing three consecutive assessments are eliminated from the supplier roster.with institutional documents including the Procurement Control Procedure and Supplier Management Procedure.The
Board of Directors undertakes top-level design and overall coordination to provide strategic guidance and foundational
assurance. Senior management is responsible for daily administration to ensure the implementation of relevant policies During the reporting period
and measures. As a core executive department the Procurement Department optimizes the ESG management system
for suppliers and establishes a full-process supervision and review mechanism covering supplier access selection
performance and evaluation. It realizes closed-loop dynamic management throughout the whole lifecycle updates and The company removed 128 unqualified suppliers.maintains the Qualified Supplier List based on assessment results and builds an efficient and sustainable supply chain
ecosystem.Supplier Onboarding and Review
Number of suppliers certified under a quality management system 876
Loctek has formulated the Supplier Development Control Procedure Supplier Access Evaluation Criteria and Supplier
On-site Evaluation Scoring Form. It has established a supplier access and review mechanism led by the Procurement
Department with cross-departmental collaboration from R&D Engineering Quality and other teams.The company
adopts a dual-supplier strategy for key materials to ensure supply stability. For suppliers already included in the Number of suppliers certified under an environmental management system 568
qualified supplier list regular and unscheduled audits are conducted to ensure they continuously comply with corporate
requirements building a stable efficient and low-risk high-quality supply chain system.Number of suppliers certified under an occupational health and safety management 387
Metric systemLocal Suppliers Other Suppliers
1250
Number of Sustainably Certified Suppliers (Units) 289
1000 1006 Units
750 Proportion of Sustainably Certified Suppliers (%) 17.72
625 Units
500 Unit
Percentage of supplier performance criteria that include environmental and social
factors (%) 100
2025 Supplier Distribution
During the reporting period
Percentage of new suppliers screened for environmental and social risks (%) 100
The company onboarded 280 new suppliers. As of the end of the reporting period
Loctek had a total of 1631 suppliers including 1006 domestic suppliers and
625 Percentage of existing suppliers re-evaluated annually on environmental and social overseas suppliers. The supplier localization ratio reached 97% and procurement issues (%) 58
expenditure from local suppliers accounted for 95% of the total.
123 124Sustainability Report 2025
Supplier Strategy
The company conducts an in-depth analysis of risks and opportunities across the entire industrial chain covering
procurement production logistics and market segments. Corresponding risk response measures are formulated
and implemented for identified risk points. Meanwhile the company seizes emerging opportunities to enhance the
resilience and stability of the supply chain.Potential Supply Chain Risks
Risk Description Probability of Impact Magni- Duration of Value Chain Priority Financial Impact Risk Category Occurrence tude Impact Links Impacted Ranking Description Mitigation Measures
Supply chain disruption will lengthen delivery Upstream Adopt a multi-supplier procurement strategy for materials. Based Supply Chain lead times affect product quality undermine Low Relatively Short-term Operations Medium Decrease in Operating on factory layout the company has successfully developed a Disruption Risk customer satisfaction and erode brand reputa- High Downstream Revenue supply chain covering multiple regions to ensure the stability and tion and market competitiveness. flexibility of material supply.Procure- Inferior materials will lead to frequent produc-
Increase in Operating
tion line failures increase quality inspection Upstream Costs Establish a comprehensive quality inspection system to conduct ment Quality Relatively
Non-compliance burdens reduce production efficiency delay Low High Short-term Operations
Relatively stringent quality inspection and screening on purchased materials
Risk deliveries and impair corporate competitive- Downstream
High ensuring that only materials meeting quality standards are allowed
Decrease in Operating
ness. to enter the production line.Revenue
Potential Opportunities in the Supply Chain
Opportunity Opportunity Description Probability of Impact Magni- Duration of Value Chain Priority Financial Impact
Category Occurrence tude Impact Links Impacted Ranking Description Mitigation Measures
By establishing long-term and stable coopera-
tive relationships with suppliers the company Sign long-term cooperation agreements with selected sup-
Cost can obtain more favorable procurement prices Medi- Upstream Relatively Reduction in Operat- pliers to clarify the rights and obligations of both parties in-
Opportunity and reduce raw material costs. Meanwhile op- Medium Medium um-term Operations cluding procurement price delivery schedule quality stand-timized supply chain management helps to cut Downstream Low ing Costs ards after-sales service and other terms so as to ensure the
inventory overstock and waste further lowering stability and sustainability of cooperation.operating costs.
125 126Sustainability Report 2025
Supplier Management Metrics and Targets Key Performance
The company sets clear supply chain goals to continuously drive process improvement and resource integration. With During the reporting period the number of outstanding suppliers with over five years of cooperation
rigorous planning and strict implementation it ensures all relevant targets are achieved as scheduled.exceeded 611 indirectly driving employment opportunities for more than 40000 people.Metric Unit TargetValue 2025 Progress
Strategic
Procurement 1.5 3
Department %
Cost reduction rate Ethical Procurement
OEM 1 1 The company is committed to building a fair impartial and transparent business environment and fully safeguarding the
legitimate rights and interests of suppliers. Integrity clauses are incorporated into the Supplier Cooperation Contracts to
prohibit commercial bribery and standardize honest transparent and orderly transaction practices.OEM new product deliveries 10000 units 1000 2542
On-time rate for procurement sample deliveries % 98 99
During the reporting period
On-time rate for trial production material pro- the company conducted integrity visits and interviews with over 72 suppliers and
curement % 95 98 responded to their integrity confirmation letters. The signing rate of supplier integrity
agreements reached 100%.Procurement pass rate % 98.8 98.9
Supplier Management Measures
Digital Management of Suppliers
Supplier ESG Management The company has built a full-process digital management system via digital platforms such as the supplier collaborative
management platform and PLM system. It covers supplier sample inspection access approval information
maintenance order collaboration delivery tracking quality feedback and performance evaluation. The system improves
When onboarding new suppliers the company fully takes into account ESG factors of suppliers including environmental
the accuracy and efficiency of supplier management and drives the supply chain collaboration toward intelligent and
management labor and occupational health management and anti-corruption. It also organizes assessments on
digital transformation.suppliers’ compliance with social responsibility codes of conduct as well as relevant laws and regulations on hazardous
substances jointly advancing the green development of the industry.Supplier Support Conflict Minerals
The company fulfills social responsibilities and commits to implementing a responsible mineral management strategy.To continuously improve suppliers’ comprehensive capabilities the company regularly organizes a variety of supportive It firmly opposes any acts that damage the environment violate human rights fuel armed conflicts or breach business
activities including supplier quality assurance training audit guidance as well as quality and environmental training. ethics. The company takes conflict minerals into account in supplier selection and daily management requiring all
It maintains close cooperative ties with suppliers to jointly drive innovation progress. During the reporting period the relevant suppliers to commit to material sources that comply with environmental and social responsibility standards.company held approximately 89 supplier support and training sessions in total.
127 128Sustainability Report 2025
Empowering Employees
and Fostering Inclusive
Growth
Company Actions
Diversity and Inclusion
Compensation and Benefits
Employees’ Rights Protection
Democratic Governance
Employee Wellbeing
Occupational Health and Safety
Employee Development
SDGs
129 130Sustainability Report 2025
Diversity and Inclusion Metric Unit 2025
New Employees by Gender:
Inclusiveness and diversity are inherent cultural genes of the Company and a core driving force for team success. With
a global layout Loctek builds cross-cultural communication platforms to integrate talents from diverse countries and
regions. While respecting cultural differences the Company encourages the collision of diverse perspectives to form Female Person(s) 248
unique innovative momentum empowering its international development.Male Person(s) 439
During the reporting period
New Employees by Re-
The Company had 1280 employees stationed in the United States Vietnam the cruitment Channel:
Philippines and other overseas regions accounting for 32.2% of the total workforce. Social Recruitment Person(s) 599
Campus Recruitment Person(s) 88 The 8th China Human Resources Sirius
Awards – Best Employer Brand for Glo-
Case Outstanding Overseas Employee Stories balized Enterprises (2025)
Campus Recruitment
With over a decade of industry experience I was deeply
attracted by the brand philosophy of Catherine Home Loctek attaches great importance to college graduates’ employment. It attracts university students through campus
and joined the company as a designer in 2025 focusing recruitment university-enterprise cooperation and other initiatives which not only helps ease the employment pressure
on the design of high-end furniture and customized of college students but also delivers a steady stream of high-quality talents for the Company.works. During my tenure I have collaborated closely with Loctek has carried out universityenterprise cooperation for 19 years since 2906. During the reporting period the
cross-functional teams and traveled to China on multiple Company jointly established a Cross-border Intelligent Joint R&D Center with the College of Software Zhejiang
occasions to participate in sample review design University building a new talent training mechanism covering joint talent cultivation and project cooperation. It also
optimization and product strategy formulation adhering received student delegations from Dongbei University of Finance and Economics Zhejiang International Studies
to creating market-oriented designs with distinctive University and many other universities for corporate visits.value. Going forward I aspire to grow together with the
company and contribute to the launch of high-quality Loctek launched the 2025 Management Trainee Campus Recruitment Program. Featuring a distinctive training system
and influential products. including one-on-one mentoring systematic rotational training and a clear fast-track promotion path the Company
strategically attracts and reserves outstanding young talents for long-term business development.Outstanding Overseas Employees
During the reporting period
Employee Recruitment The Company signed agreements with 7 universities to establish joint talent cultivation
mechanisms and build practical training bases and collaborated with 14 universities on
Loctek adheres to the principles of open recruitment fair competition and proper job-person matching. The Company technological research and innovation.has formulated policies including the Recruitment Management System Onboarding Management System and Internal
Referral Incentive Plan to standardize recruitment procedures improve talent selection and employment mechanisms
Case Talents Gather in Yongcheng Intelligent Yinzhou Forges Ahead — Young Talents Yinzhou and realize the scientific and rational allocation of human resources. Tour Enters LoctekDuring the reporting period On April 21 as part of the “Gather in YongchengEmpower Yinzhou’s Future” Young Talents Yinzhou
The Company recruited a total of 687 talents through internal selection external recruitment Tour event the Company welcomed outstanding students from top universities including Tsinghua
and campus recruitment. It was listed on the “Talent Gazelle Enterprise” list and won the Best University Shanghai Jiao Tong University and
Employer Brand Award at the 8th China Human Resources Sirius Awards 2025 fully recognizing Zhejiang University aiming to attract and gatherthe company’s outstanding achievements and industry reputation in employer brand building high-caliber talents from elite institutions. Scene of “Gather in Yongcheng Empowerand human resource management. Yinzhou’s Future” Event
131 132Sustainability Report 2025
Case University-Enterprise Linkage Cultivating Talents for the Future Metric Unit 2025
In December teachers and students from the University of Nottingham Ningbo China visited Loctek for the
university-enterprise open day activity. The participants gained an immersive experience of the company’s Number of Internal Employee Transfers Person(s) 245
corporate culture and conducted in-depth exchanges on innovation and entrepreneurship fund projects
that integrate academic research with enterprise practice laying a solid foundation for further in-depth Internal Employee Transfer Rate % 6.2
cooperation between both parties.Providing Employment Opportunities for Special Groups
The Company actively fulfills social responsibilities and upholds the philosophy of humanistic care by prioritizing the
recruitment of people with disabilities veterans and ethnic minorities. It has set up dedicated production lines for
employees with disabilities and launched specialized training courses with guidance from designated teams striving to
build an equal inclusive and supportive workplace for vulnerable groups.During the reporting period
Another 8 employees with disabilities joined the Company.Creative Employee ID Badge Group Photo at the University-Enter-
prise open day Event
Diversity Structure
Case Campus Recruitment Activity at the University of Nottingham Ningbo China Upholding the core value of perseverance and dedication Loctek has built a dynamic and youthful workforce. The
Company continuously empowers employees with capabilities and passion for innovation creativity adaptability and
In April to attract more international lifelong learning and focuses on cultivating their global vision and cross-cultural insight. Meanwhile the Company
and high-caliber talents the Com- builds a high-quality career development platform to enable employees to leverage their talents share development
pany actively carried out campus achievements and forge ahead together.recruitment cooperation with the
University of Nottingham Ningbo
China. Resume collection and prelim- As of the end of the reporting period
inary interviews were arranged at the
recruitment site to efficiently select The Company employed a total of 3974 staff members including 608 local
outstanding candidates matching job
employees accounting for 15.30% of the total workforce. The proportion of employees
requirements building up a talent
reserve with global vision and profes- with disabilities stood at 0.83% and ethnic minority employees accounted for 3.90%.sional competence for the company.Loctek Campus Recruitment Fair Scene
Key Performance
Internal Job Mobility Total number of employees Number of disabled employees Number of minority employees
The Company has formulated internal rules and regulations including the Employee Transfer Management System 3974 Persons 33 Persons 155 Persons
Resignation Management System Resignation and Termination Procedures and Labor Dispute Management Measures
providing standardized guidelines for the full life-cycle management of labor contracts.Adhering to the principles of Number of veteran employees Number of dispatched employees Number of part-time employees
fairness and transparency the Company offers clear resignation guidelines emphasizes communication and feedback
and continuously optimizes employee experience. A multi-level dispute resolution mechanism has been established: 0 Persons 1010 Persons 49 Persons
in the event of labor disputes department supervisors will first conduct mediation. If the issue remains unresolved
employees may further appeal to the Human Resources Department.For involuntary termination of employment the
Company conducts prior consultations and provides reasonable compensation as well as career transition support to
minimize impacts on employees. Eligible resigned employees are also welcome to rejoin the Company. Note: The total number of employees covers those who have signed labor contracts with the Company excluding dispatched workers and part-
time employees.
133 134Sustainability Report 2025
Compensation and Benefits Management
Number of employees by geographical region: Number of employees by gender:
1280Persons 2692Persons 1572 Compensation and Benefits ManagementPersons 2402Persons
Loctek adheres to the philosophy of performance-oriented as the core position-based as the foundation and
competency-based as the criterion and has formulated the Organizational Performance Management System and
Performance Appraisal Management System. It clarifies that the company’s compensation structure consists of basic
salary post salary performance bonus commission project bonus benefit sharing special awards and allowances and
2Persons subsidies.The company takes local income levels into full consideration and the compensation for grassroots employees
is well above the local minimum wage standard.Mainland China Hong Kong Macao and Male Female
Taiwan regions of China As of the end of the reporting period
Overseas Regions
The average monthly salary of full-time grassroots employees in Ningbo exceeded the local
Number of employees by job level: Number of employees by expertise: minimum wage by 213%; that of full-time grassroots employees in Guangxi exceeded the
28Persons 334Persons local minimum wage by 215%.
65Persons
567Persons
1877Persons The Company has formulated the Organizational Performance Management System and Performance Appraisal
Management System stipulating that performance appraisal results are linked to multiple dimensions including bonus
964Persons distribution salary adjustment employee promotion and equity and option allocation.If employees have objections to
salary and performance appraisal results they may file an appeal via the company’s internal audit reporting platform on
3379Persons the intranet or directly feedback to the Human Resources Department. Relevant departments will handle the matter in
734Persons a timely manner and inform employees of the outcome.
Senior Management Middle-level Production Sales Technology During the reporting period
Management
Frontline Employees Finance Administration The per capita salary of the Company reached 125500 yuan and the per capita
revenue generation stood at 1524700 yuan.Number of employees by age: Number of employees by education:
151Persons 13Persons 216Persons Employee Incentives
632Persons
1753Persons To effectively enhance employees’ work enthusiasm and creativity the Company has established a variety of incentive
mechanisms including performance incentives equity incentives project incentives sales incentives over-target
incentives and year-end excellence selection. It has also launched an employee equity incentive plan enabling
employees to share the fruits of corporate development strengthen corporate cohesion and competitiveness and
2193Persons 1552Persons drive the Company’s long-term growth.The Company has formulated the Special Welfare Incentive Plan for Strivers and
1438Persons set up special welfare incentives to reward quarterly S-level employees fostering a workplace culture of dedication
commitment and diligent striving.Under 30 years old (exclusive of 30) Doctoral Degree or Above Master’s Degree
30-40 years old (inclusive of 30 and During the reporting period
exclusive of 40) Bachelor’s Degree Below Associate’s degree
40-50 years old (inclusive of 40 and
exclusive of 50) The Company granted 303063 shares of the second type of restricted
50 (and above) years old shares to 50 eligible incentive recipients aiming to attract and retain core key
personnel and outstanding talents.
135 136Sustainability Report 2025
Case 2025 Spring Festival Annual Gathering & Annual Recognition Ceremony Improve Employee Welfare
In January Loctek held its Spring Festival Annual Party and Annual Commendation Ceremony The Company attaches great importance to employee well-being and has built a multi-level welfare security system
simultaneously at the headquarters as well as manufacturing bases in Ningbo Guangxi and Vietnam. covering health insurance paid leave vocational training and employee activities. It comprehensively safeguards
The event reviewed annual achievements and collectively commended outstanding employees for their employees’ rights and interests fosters a harmonious and positive working atmosphere and motivates employees to
remarkable performance. grow together with the enterprise.Social insurance and housing fund statutory holidays marriage leave maternity leave
Statutory Benefits
paternity leave bereavement leave annual leave sick leave etc.Anniversary gifts team-building activities complimentary breakfast and lunch gym
Company Benefits access holiday bonuses annual health checkups childcare benefits extracurricular club
Loctek Headquarters Ningbo Jiangshan & Binhai Manufacturing Base activities free online training platform access.Business trip allowance seniority allowance overseas assignment allowance high-
Allowances temperature allowance communication allowance parking subsidy language proficiency
and Subsidies
allowance meal subsidy.Loctek offers a variety of working time arrangements including standard working hours
flexible working hours and comprehensive working hours. The majority of positions follow
Working Hours and the standard 8-hour workday. In addition to regular holidays employees on long-term
Leave Policies
overseas assignments are entitled to additional family visit leave team-based welfare
Guangxi Manufacturing Base Vietnam Manufacturing Base and reimbursement for travel expenses related to family visits.Case S-level Employee Incentive – Paid Overseas Trip Anytime
In February 2025 the Company organized S-level employees to take a trip to Vietnam. They experienced
local customs and culture and tasted characteristic delicacies which further enhanced employees’ sense
of belonging and well-being.Staff Canteen Staff Activity Center
Vietnam Factory Tour Beach off-roading
Canteen Meals Staff Gym Spring Festival Gifts & New
Year Goods
137 138Sustainability Report 2025
Return-to-work Subsidy During the reporting period
Every year during the post-Spring Festival return-to-work period Loctek holds work resumption ceremonies at its
headquarters and major production bases. The ceremonies are designed to encourage Loctek employees to return The labor contract signing rate and social insurance coverage rate both reached 100%.to their posts with a renewed spirit and the best wishes for the new year embarking on a new chapter of their work
journey.Case 2025 Year of the Snake Auspicious Kick-off Event Labor Rights Protection
Every year during the post-Spring Festival return-to-work period Loctek holds a commencement
ceremony at its headquarters and all major production bases. The event encourages employees to return The Company is committed to safeguarding employees’ fundamental rights and fostering an inclusive respectful
to their posts with a refreshed mental state and good New Year wishes embarking on a new journey. workplace. It has adopted policies such as the Anti-Discrimination Procedures Anti-Harassment and Anti-Abuse
Procedures Prohibition of Forced and Punitive Labor and No Child or Underage Labor Policy. These measures ensure fair
employment practices prohibit child and forced labor prevent harassment and discrimination and protect employees’
rights to freedom of association unionization and collective bargaining.During the reporting period
Ningbo Jiangshan Auspicious Vietnam Kick-off Event Vietnam Chongqing Kick-off Event No incidents of discrimination harassment forced labor or child labor occurred during the
Kick-off Event Kick-off Event reporting period.Safeguarding Overseas Employee Rights
Loctek’s overseas subsidiaries are integral to its global operations and fully comply with local labor laws. For example in
the United States the Company strictly adheres to the Fair Labor Standards Act (FLSA) Equal Employment Opportunity
Headquarters Kick-off Event Binhai Kick-off Event Guangxi Kick-off Event Commission (EEOC) Regulations and the Family and Medical Leave Act (FMLA) to ensure fair safe and respectful
treatment of employees. The Company guarantees that all wages meet or exceed federal and state minimum wage
Employee Stability standards and complies rigorously with overtime pay requirements. It fosters a work environment free of discrimination and harassment grounded in equal opportunity across hiring promotion compensation and benefits. Employees are
The Company attaches great importance to the stability of employees and teams. It proactively learns about difficulties provided with adequate support including access to paid leave for personal or family medical needs enabling a healthy
encountered by employees in work and life and takes active measures to help them achieve work-life balance.At work work-life balance. No cases of discrimination harassment unpaid overtime forced labor or denial of leave entitlements
the company arranges mentors for every new employee to help them quickly adapt to the job and integrate into the were reported during the reporting period.team through mentorship. Meanwhile internal job competitions and other channels are offered to provide employees
with new development opportunities.In daily life interest-free housing loans are available for eligible employees. The
company also prepares departure gifts for resigning staff creating a friendly offboarding atmosphere.Case Overseas Harassment Prevention Training
Protect Employees' Rights and Interests
Loctek adheres to the Labor Law of the People’s Republic of China and the Labor Contract Law of the People’s Republic
of China and other relevant laws and regulations. In its international operations the Company complies with the In August the Company organized employees in the
principles of the United Nations Global Compact the Universal Declaration of Human Rights and other international United States to participate in government-sponsored
conventions. It has formulated institutional documents including the Labor Contract Management System and the sexual harassment prevention training enhancing
Employee Handbook and strictly implements a full-staff labor contract system to effectively protect employees’ employees’ awareness of self-protection.legitimate rights and interests.Meanwhile the Company has established a three-tier governance framework for
management responsibilities: the Board of Directors oversees overall strategy; senior management is responsible for
implementation and coordination; and department heads undertake daily management to safeguard employees’ lawful Overseas Employee Harassment
rights and interests. Prevention Training
139 140Sustainability Report 2025
As of the end of the reporting period Exclusive Benefits for Female Employees
Loctek has established more than 30 overseas subsidiaries in 14 countries. Overseas employ- In accordance with the Employee Handbook the Company legally protects female employees’ statutory leave entitlements
32.2 including prenatal examination leave maternity leave and breastfeeding leave. It prohibits salary reduction dismissal ees account for approximately % of the total workforce and the coverage rate of training or termination of labor or employment contracts on the grounds of pregnancy childbirth or breastfeeding of female
employees.on diversity equality and inclusion reaches 100%.The Company has set up lactation rooms at its headquarters and all production bases to provide convenience for
breastfeeding female employees. Emergency sanitary napkin vending machines are also installed in female restroom
Support for Female Employees areas for daily and emergency needs.The Company is committed to fostering a diverse and equitable workplace ecosystem attaching great importance Key Performance
to and fully unlocking the development potential of female employees and ensuring clear career paths and smooth
promotion channels for them. During the reporting period the Company made solid progress in supporting women’s
career development. During the reporting period 27 employees took maternity leave and the maternity
leave return-to-work rate reached 100%.Key Performance
Female employees account for 39.56% of the total workforce the female promotion ratio
reaches 32% females occupy 28.57% of the Board of Directors and 28.57% of the Case Shine at Every Moment – Women’s Day Themed Activities
senior management and female technical staff account for 22.2% of all employees. On March 7 Loctek held a series of celebrations for International Women’s Day. The events included flower-
themed elevator decorations the “Three Merits Female Employees Award Ceremony” and DIY workshops
for bracelets and potted plants conveying sincere respect and care for female employees.Female Career Sharing
Case Outstanding Female Teams in the Workplace
In 2025 the European Independent Station Team the US Independent Station Team and the European
Amazon Team of Loctek’s Overseas Brand Business Department were awarded the Business Breakthrough
Award. Dominated by female members these teams continuously pushed boundaries with wisdom and
diligence and delivered outstanding business performance.Flower-themed elevators Three Virtues Women Award Ceremony
Outstanding Female Teams in the Workplace DIY Bracelet Making Activity DIY Potted Plant Activity
141 142Sustainability Report 2025
Democratic Governance Questionnaire survey using anonymous method. The employee satisfaction analysis
report includes the following: trends in employee satisfaction items with the lowest
satisfaction and corrective actions to be taken and the extent to which issues raised
Method in the previous survey have been resolved. After the satisfaction survey is completed
Employee Communication Channels feedback on the survey results should be provided in a timely manner. For items with low
satisfaction improvement measures should be proposed followed by supervision and
inspection.The Company firmly upholds employees’ right to freedom of association and collective bargaining. It has established
a trade union and continuously optimized the corporate democratic management system based on the trade union
and employee representative congress encouraging employees to actively participate in democratic management.The Organizational culture role clarity career progression learning and development op-
Company has built an all-round communication system combining online and offline channels. Offline channels include Surveportunities working conditions compensation and benefits performance management
factory suggestion boxes Voice of Employees and Boss Listen to Me activities. Online platforms such as the official Dimensions
occupational health and safety leadership and job suitability.WeChat account “Loctek Fan” office OA system (Lark) and feedback QR codes enable real-time communication and
opinion collection to ensure smooth information exchange.During the reporting period
45 2 Target Covers five employee categories: management R&D production finance and adminis-The trade union organized activities convened employee representative Participants tration.
congresses and reviewed and approved 2 matters.Employee Complaints Mechanism
Annually. Survey
Frequency
The Company has implemented the Employee Communication and Complaint Management Procedure and the Labor
Dispute Resolution Policy to ensure that internal concerns can be raised through multiple channels including verbal
reports written submissions and roundtable discussions. Regardless of the nature of the complaint the Human Resources
Department is committed to fair confidential and timely resolution with feedback provided within five working days. Satisfaction Survey Process
Constructive suggestions are forwarded to relevant departments and employees who make valuable contributions may
receive recognition or rewards.Employee Satisfaction
The Company attaches great importance to employees’ experience and demands and has established a long-term
mechanism for regular employee satisfaction and engagement surveys. By collecting and analyzing employee feedback
the Company targets and resolves existing problems optimizes employee benefits strengthens team collaboration and
leadership and promotes the sustainable and healthy development of the enterprise.Key Performance
During the reporting period a total of 2268 employees participated in the
satisfaction survey with the overall employee satisfaction rate reaching 96.5%.
143 144Sustainability Report 2025
Employee Wellbeing Case Joy Across the Globe Warmth for Mid-Autumn Festival – Global Employee Mid-Autumn Care Initiative
On the eve of the Mid-Autumn Festival Loctek launched themed care activities including distributing welfare
gift packages and organizing handmade mooncake workshops. The company extended festive greetings to
Employee Activities overseas employees across borders and paid home visits to the families of expatriate employees in China
allowing staff at home and abroad to deeply feel the warmth of a big family.Loctek always regards employee well-being as the cornerstone of corporate development building a comprehensive and
multi-level life care system for employees covering accommodation catering health and entertainment.The company
provides safe and comfortable staff dormitories as well as balanced free staff meals. It is also equipped with a variety
of sports facilities including a gym table tennis room and basketball court. Various sports events and fitness courses
are held from time to time to enrich employees’ spare time and promote physical and mental health.For expatriate
employees the company launches a family connection program and arranges regular family visits to ensure family
harmony for employees.Case The 12th “Little Migratory Birds” Summer Camp of Loctek
Handmade Mooncake Making Activity Traditional Mid-Autumn Festival Fun
Interactive Games
In July the company heldthe 12th “Little MigratoryBirds” Summer Camp
providing more than 50
employees’ children with
one week of wonderful
courses and fun activities.Overseas Employees Mid-Autumn Festival Condolence to Families of Expatriate
Condolence Employees
The 12th “Little Migratory Birds” Summer Camp of Loctek
Case Rejoice in Health and Blessings Every Double Ninth Festival – 2025 Double Ninth Festival Family Day Activities Case “Joy in the Dragon Boat Festival United as One” Themed Activities
In October Loctek launched the Double Ninth Festival Family Day activities. Employees’ parents were invited
to visit the company and taste staff meals to learn about their children’s working environment. Anti-fraud On the eve of the 2025 Dragon Boat Festival Loctek launched a series of themed activities under the slogan
lectures and physical check-ups were also arranged fully reflecting the company’s sincere care for employees “Joy in the Dragon Boat Festival United as One”. Employees participated in innovative interactive sessions
and their families. including the ergonomic-chair land dragon boat race sachet making and themed dessert tasting. The
activities enabled employees to experience traditional Chinese culture while enhancing team cohesion and
collaborative spirit through creative team-building events.Parents visit Loctek Police-led Anti-fraud Lectures
Land Dragon Boat Race DIY Dragon Boat Festival Sachets
Physical Health Check-ups Warm group photos
145 146Sustainability Report 2025
Employee Assistance Program
Loctek has established an employee assistance mechanism to support staff facing sudden life difficulties and financial
pressures caused by major family illnesses accidents and other emergencies providing timely and necessary assistance
to help them to tide over hardships.During the reporting period
the company offered support to 4 needy employees with a total of RMB 115000
granted in condolence funds and supplies.Case Caring Assistance to Overcome Difficulties
In January wildfires raged across California USA.The home of Nikolas an employee of Loctek’s U.S. Loctek Inc. ISO 45001 Occupation- Jiangshan Plant ISO 45001 Guangxi Plant ISO 45001
subsidiary was burned down leaving his family in al Health and Safety Management Occupational Health and Safety Occupational Health and Safety
severe hardship. The company immediately offered System Certificate Management System Certificate Management System Certificate
support by donating USD 5000 and organizing
voluntary donations from employees raising over RMB
50000 in total. In addition the company granted the
employee an extra 5 days of paid leave and advanced The Company has formulated an assessment system for work safety responsibility system with 19 full-time and part-
one month’s salary making every effort to help him to time safety administrators on staff supported by intermediate registered safety engineers. All employees have signed
get through the difficult time. the Work Safety Responsibility Letter to clarify primary safety responsibilities strengthen safety risk control advance
work safety management and effectively prevent safety accidents. Meanwhile the Company has established a sound
Love and Support Through Hard Times safety assessment mechanism and set up a work safety responsibility assessment team. Safety assessment results are
incorporated into employee performance appraisal to further consolidate safety management accountability.Occupational Health and Safety
Key Performance
Occupational Health and Safety Governance During the reporting period the Company invested RMB 5.2436 million in the improvement and
rectification of potential safety hazards and all types of facilities and equipment have been equipped with
The Company has formulated the EHS Policy Occupational Health Management System and Work Safety Objective
safety interlock protection devices.Management System. It has established an occupational health and safety management organizational structure led
by the general manager and set up a work safety committee. Through on-site inspections and management account 5.2436
reviews the Company provides solid institutional and organizational support for occupational health protection and work Workplace Safety
safety management. During the reporting period the Company has obtained the ISO 45001 Occupational Health and 5 Investment Amount
Safety Management System certification.
4
Occupational Health Organizational Structure
3 2.2489 Percentage of Workplace Safety
Responsible Re职spo责ns内ibilities
0.078%
容 Investment in Department 2 1.35 Operating Revenue
0.035%0.040%
Organize accountability assessments; implement workplace safety policies; establish a safety
Safety Committee 1
management grid; convene regular safety meetings.
0
Organize system development and drills; carry out education training and inspections; monitor 2023 2024 2025
Relevant major risks and take corrective actions; supervise implementation of rectification measures;
Department arrange occupational health check-ups education and training and monitoring of occupational
disease prevention.
147 148Sustainability Report 2025
Occupational Health and Safety Strategy
Loctek strictly complies with relevant laws and regulations proactively identifies risks and opportunities in work
safety formulates targeted response measures against identified risks consolidates the company’s work safety
line of defense and safeguards employees’ health and safety.Occupational Health and Safety Risks
Risk Description Probability of Impact Magni- Duration of Value Chain Priority Financial Impact Risk Category Occurrence tude Impact Links Impacted Ranking Description Mitigation Measures
High noise and vibration generated by the op- Provide employees with necessary labor protection supplies in-
eration of production equipment may cause cluding dust masks noise-proof earplugs anti-corrosion protec-
hearing impairment and neurological problems tive clothing acid and alkali resistant gloves and gas masks. Verti-
among employees. Dust produced during cut- cal eyewash stations and other facilities are equipped at operation
Occupational ting grinding electrostatic spraying and other
sites.Increase in Non-oper-
Disease Risk processes is likely to cause pneumoconiosis. Low Medium Short-term Operation Medium ating Expenses The Company regularly maintains occupational health and sanita-The use of strong acids strong alkalis and var- tion facilities entrusts professional institutions to conduct testing
ious chemical agents in pretreatment pickling in occupational hazard workplaces implements risk notification for
and sewage station operations may lead to posts with occupational hazards and arranges pre-job on-the-job
occupational health risks such as skin burns and post-resignation physical examinations with results disclosed
respiratory irritation and chemical poisoning. publicly ensuring effectiveness and transparency.Workplace Acci- Equipment failure due to aging poor mainte- Increase in Non-oper- Implement preventive maintenance routines including inspection
dent Risk nance or operator error could lead to fires ex- Low Medium Short-term Operation Medium cleaning lubrication and tightening to ensure equipment remains plosions or mechanical injuries. ating Expenses in good condition.Potential Opportunities for Occupational Health and Safety
Opportunity Opportunity Description Probability of Impact Magni- Duration of Value Chain Priority Financial Impact
Category Occurrence tude Impact Links Impacted Ranking Description Mitigation Measures
Strict work safety management demonstrates
the company’s deep commitment to employ- The company has set up a dedicated safety supervision Reputation Op- ees’ health and safety improves management Medium High Medium and Operation Medium Reduction in Operat- department to conduct regular safety inspections on production portunity efficiency and enhances public trust and rec- long-term ing Costs sites so as to identify and rectify potential safety hazards in a
ognition of the enterprise. timely manner.
149 150Sustainability Report 2025
Management of Occupational Health and Safety Impacts Risks and Key Performance
Opportunities
Risk Identification and Assessment During the reporting period the Company conducted more than 2200 on-site safety
Loctek actively commits to hazard identification. It compiles risk identification lists covering various potential patrols maintaining a 100% intact rate of fire-fighting facilities. A total of 92 safety
hazards in production and daily operations and formulates corresponding control measures to reduce the inspections were carried out identifying 1960 potential safety hazards for rectification.occurrence rate of safety accidents.All 1960 rectification items were completed and closed in a timely manner achieving
a 100% hazard rectification and closure rate.Hazard Each factory carries out hazard identification defines the hazard identification
Identification method and compiles a hazard list for each department.Emergency Response Management
Various tenses and states are considered. Risk levels are determined through scor- Risk
ing and whether the risk is acceptable is confirmed based on the risk level. Assessment Loctek has formulated and improved a complete set of emergency management systems including the Work Safety
Accident Emergency Plan Special Emergency Rescue Plan for Preventing High-temperature Heatstroke Accidents in
Summer Food Poisoning Emergency Drill Plan and Workshop Electric Shock Accident Emergency Drill Plan. The Company
has established a management mechanism featuring hierarchical inspections 24-hour on-duty arrangement and a
company-level professional emergency team. It systematically identifies various potential safety risks in production and
operation ensuring rapid scientific and effective emergency rescue responses to unexpected safety incidents so as to
Priority is given to rectifying high-level hazard risks. For general hazards program fully protect employees’ safety and health.Risk Control management education and training and routine inspections are adopted.Case High-temperature Heatstroke Emergency Drill
Work Safety Risk Identification and Evaluation Procedure
In August Loctek conducted a
high-temperature heatstroke emer-
gency drill in the powder coating
Process Supervision Measures workshop of the Guangxi factory. The
entire drill process from accident
Loctek has formulated a series of work safety reporting to medical transfer was
systems including the Work Safety Inspection System completed within 15 minutes which
Forklift Safety Management System and Safety effectively verified the feasibility of
Operating Procedures for Piston Air Compressors. the emergency plan and the prompt
It has established a long-term mechanism for the response of each working group.investigation and rectification of potential safety Through this practical drill employees
hazards. The Safety Department is responsible for further consolidated and proficiently
supervision and inspection. Centering on accountability mastered the emergency disposal pro-
implementation the Company systematically identifies cedures for high-temperature heat-
potential risks and conducts safety reviews to discover stroke incidents.all types of hidden dangers. It strictly urges responsible
departments to complete rectification in a timely High-temperature Heatstroke Emergency Drill
manner so as to realize effective control and source
management of work safety risks. On January 13 the Guangxi factory organized safety experts to conduct a comprehensive inspection of the production
base to identify potential safety hazards.
151 152Sustainability Report 2025
Digital Safety Management
Workplace Safety Goals 2025 Completion 2026 Planned
Status Targets
Loctek actively empowers work safety risk management with digital tools. By building and optimizing the digital The work-related minor injury accident rate is less than 3‰ the serious injury ac-
management platform the Company realizes dynamic monitoring of various safety risks at production sites. The cident rate is less than 0.2‰ the fatality accident rate is zero and the controlled Achieved Continuous Improvement
platform can automatically identify abnormal working conditions issue real-time early warnings and assign rectification rate of major hazard sources is 100%.tasks via the APP system to remind safety management personnel to intervene and handle problems in a timely
manner. It effectively improves the timeliness of risk identification and builds a solid digital line of defense for work Traffic violations are controlled within 10% and traffic safety accidents are zero. Achieved Continuous
safety. Improvement
As of the end of the reporting period Eliminate all types of fire hazards; the fire accident rate is zero. Zero Continuous Improvement
Loctek had maintained 1376 consecutive days of safe production (starting from Safety protection devices for machinery and equipment are complete and effec- Continuous
tive; the machinery and equipment accident rate is zero. Zero Improvement
March 26 2022).Strengthened Management Measures
Metric Unit 2025 Occupational Health Prevention and Control
Number of Occupational Injuries Person(s) 0 The Company attaches great importance to occupational health protection has formulated the Occupational Disease
Prevention and Control Management System and has adopted a full range of protective measures to fully safeguard
employees’ physical and mental health as well as a safe working environment thereby consolidating the line of defense
Number of Occupational Injuries for occupational health and safety.per Hundred Million Yuan Revenue Person(s) /Yuan 0
Occupational Health Management Measures
Occupational Injury Rate % 0
Monitoring of Oc- The company regularly engages professional third-party agencies to conduct system-
Injury Rate per Million Work Hours % 0 cupational Disease atic monitoring of occupational hazard factors at production sites and publishes the
Hazard Factors monitoring reports to ensure effectiveness and transparency.Work-related Loss
Number of Work-Related Fatalities Person(s) 0 Occupational health examinations are strictly carried out in accordance with proce-
Occupational dures for pre-employment on-the-job and off-the-job periods and annual health
Health Check-ups check-ups are organized for employees. During the reporting period the employee
Work-Related Fatality Rate % 0 health check-up coverage rate was 100%.Number of Work Days Lost Due to The Company held the Occupational Disease Prevention Week enhancing employ-
Occupational Injuries Day(s) 0 ees’ occupational health protection awareness and professional capabilities through
Occupational Disease targeted training and assessment. Occupational hazard notification cards were placed
Prevention Training in workshops to clearly specify the types of occupational hazards potential health im-
pacts and corresponding response measures. During the reporting period the training
Work Days Lost Due to Occupation- Day(s) / Yuan 0 sessions of the Occupational Disease Prevention Week recorded 3148 person-times of al Injuries per Million Yuan Revenue participation.In accordance with the PPE Wearing Standards for All Positions the Company provides
Provision of Per- employees with personal protective equipment including earplugs safety boots gog-
Occupational Health and Safety Indicators and Targets sonal Protective Equipment (PPE) gles protective gloves and safety shoes to reduce the risk of occupational diseases among staff.Loctek has formulated the Medium and Long-term (Five-Year) Work Safety Plan and established a full-process safety The company encourages employees to participate in sports activities by providing fi-
management system covering safety culture development hazard investigation and work safety management. By nancial and venue support and regularly organizes activities such as basketball games
closely linking work safety indicators with the performance appraisal of each department the Company has built a work Employee Mental karaoke and book reading;safety responsibility system featuring “everyone takes responsibility every level assumes accountability and each role Health Care Promote mental health awareness provide mental health education and regularly or-fulfills its duties” ensuring the effective implementation and continuous improvement of work safety targets. ganize employee activities to reduce work-related and psychological stress.
153 154Sustainability Report 2025
Metric 2025 Achievement
Cultivate a Robust Safety Culture
Status
To further raise employees’ awareness of work safety Loctek formulated the 2025 Annual EHS Training Plan. The
Number of New Occupational Disease Cases 0 Company regularly carries out various measures and activities to strengthen safety awareness systematically organizes
training on work safety laws regulations and safety certification and introduces external professional resources to
deliver specialized safety training.Through first-aid lectures Work Safety Month campaigns safety competitions and
Occupational Disease Incidence Rate 0% regular work safety training the Company has effectively improved all employees’ safety literacy and emergency
response capabilities providing solid support for the sustained and stable performance of corporate work safety.Occupational Health Monitoring Compliance Rate for Occupational Disease
Protection Measures Hazard Factors 100% Safety Education Content
Rate of pre-job three-level safety training for employees 100% Safety Skills Learn the use and practical skills of workplace equipment and personal protective
Education equipment (PPE); master accident handling and self-rescue capabilities.Licensed Operation Rate for Special Operation Personnel 100%
Safety
Knowledge Learn general enterprise knowledge general safety knowledge and specialized safety Health Insurance Enrollment Education knowledge.Loctek has uniformly purchased the “Tianyi Yongning Insurance” for all employees for five consecutive years effectively
complementing basic medical insurance and reducing employees’ medical expense burden. During the reporting Safety Regula- Learn national safety regulations industry safety regulations and corporate workplace
period the Company completed the insurance enrollment of 2039 employees.Meanwhile the Company arranges tions Education safety rules.regular physical examinations for employees to provide scientific health assessment and professional guidance. It
also holds various health lectures to help employees establish sound health concepts safeguarding their physical and
mental well-being in multiple dimensions.Safety Ideology
Education Learn ideological education and discipline education.As of the end of the reporting period
A total of 10 employees have received compensation claims from the Tianyi Yongning
Insurance. Case Training on the Use of Occupational Health Protection Facilities
In July Jiangshan Factory organized special training on the use of occupational health protection facilities
at the packaging workshop site.Case Hospital-Enterprise Co-construction for Employee Health Care
In April Loctek invited
a team of medical ex-
perts from Ningbo No. 2
Hospital to hold an on-
site free clinic activity.Featuring health lectures
and multi-disciplinary
consultations the event
provided employees with
convenient and profes-
sional health services
Charitable Free Clinic Activity Training on the Use of Occupational Health Protection Facilities
in Packaging Workshop
155 156Sustainability Report 2025
Employees Development
Safety Education and Training
Metric Unit 2025 Employee Training and Development Framework
Loctek attaches great importance to the professional competency development of employees. Adhering to the talent
employment philosophy of fairness transparency and openness and the talent cultivation ethos of globalization
Total Safety Training Investment Ten thousand Yuan 74.73 innovation and youth empowerment the Company has formulated the Employee Development and Training
Management Policy. It standardizes employee training administration and establishes a full-lifecycle training system
covering new employee onboarding in-service skill enhancement managerial competency advancement and
Number of Safety Training Sessions Sessions 320 professional technical proficiency upgrading. Targeted development programs are tailored for employees and the
training mechanism is optimized on an annual basis to achieve mutually beneficial growth for both the enterprise
and its workforce.The Company adopts a diversified training model incorporating online courses offline sessions and
external professional instructors. With targeted training arrangements and a robust training effectiveness evaluation
Number of Participants in Safety Training (Person-Times) Person-Times 20908 mechanism it has built a virtuous cycle of training—assessment—optimization—retraining effectively translating
training outcomes into tangible improvements in employee capabilities and driving the sustainable development of the
Company.Total Safety Training Hours Hour(s) 332 During the reporting period
The average annual training hours per employee reached approximately 32
Cumulative Total Safety Training Hours for All Personnel Hour(s) 21744 hours for management training 34 hours for professional competency training
and 30 hours for leadership training with the overall average annual training
Average Safety Training Hours per Employee Hour(s) 11 duration per employee standing at around 32 hours.Category Training curriculum system
Safety Training Coverage Rate % 100
Pioneer Star Program – Core Leadership Team Development
Safety Risk Protection Training Coverage Rate % 100 Management Growth Star Program – Loctek Reserve Talent Pool Development
Joy Star Program – Special Development Program for Campus Recruits
Contractor Safety Management Professional Skills Required Courses & Exam Mechanism
To standardize the safety management of contractors the Company has formulated the Relevant Party Safety Technical Cluster Marketing R&D Cluster Functional Pro-
Management System and the External Construction Safety Management Agreement
Manufacturing. These documents clarify the professional category Training Cluster TrainingTraining Cluster Training
fessional Cluster
safety management responsibilities and requirements for relevant parties including suppliers contractors and external Training
construction personnel ensuring that all operational activities carried out by external parties within the Company’s
premises comply with safety specifications. Professional Course Learning Matrix Linked to Talent Development Pathways
During the reporting period Employee Orientation Values Advocacy General Office Skills Academic Education
29 General Cate-the Company provided safety education and training for person-times of relevant gory
ETTP LeXueTang Massive Online Courses
parties such as contractors and suppliers.Talent Development System
157 158Sustainability Report 2025
New Employee The Company provides comprehensive training for new recruits covering corporate culture
Case Leadership Competence Development
Development internal policies professional skills and product knowledge enabling new employees to inte-
grate into the organization efficiently and smoothly. The Company provides practical leadership enhancement training for middle and senior management personnel.The training innovatively adopts a three-stage development model of theoretical teaching case discussion and
action learning. Combined with the Company’s actual business scenarios targeted research projects on key man-
agement challenges have been set up. Through systematic and practical training participating managers have
Leadership Through mentorship role-playing and practical management training the Company culti-
Development vates outstanding talents for the management track and optimizes its reserve talent pipeline. achieved remarkable improvement in core competencies including strategic planning team leadership and complex
problem-solving.The Company actively encourages employees to pursue further academic education. Em-
Employee ployees who obtain state-recognized college or bachelor’s degrees are eligible for tuition
Self-Develop- reimbursement. Meanwhile Loctek strongly supports employees’ participation in vocational
ment & Growth skills training and provides abundant learning channels and resources to facilitate profes-
sional qualification certification.Professional The Company provides professional training courses for employees across all positions cov-
Competence
Development ering manufacturing marketing R&D and functional departments.Case New Employee Training Management Competence Development
To help new recruits quickly to familiarize themselves with
corporate culture integrate into the workplace and master
job-specific skills the Company has established a systematic Internal Trainer Team
and multi-dimensional new employee development system. The
training curriculum covers the company’s development history Loctek has established a standardized instructor selection system and built a professional internal trainer team. Undertaking
organizational structure core values internal rules and regu- the core mission of internal corporate training the team effectively facilitates knowledge inheritance and employee growth
lations and other foundational modules. It effectively shortens serving as a key bridge between the Company’s strategic implementation and talent development.the adaptation period for new joiners enhances their sense of
identity and belonging and lays a solid foundation for the Com- During the reporting period
pany’s talent echelon development.New Employee Training
The Company cultivated a total of 127 internal trainers including
20 senior instructors and 107 certified instructors.
Case “Talent Development Day” Nearly 200 Employees Certified
Case “New Gifts for Mentors” Teacher’s Day Themed Activity
On September 15 Loctekheld the “Talent Devel-opment Day” simultane- On September 10 Teacher’s Day Loctek held
ously at three locations: the themed activity “Shuxiu New Rituals” for all
Binhai Jiangshan and the internal trainers and mentoring staff. By present-
headquarters. Nearly 200 ing symbolic gifts and fresh flowers in a blend
employees participated of traditional etiquette and modern warmth the
in independent vocation- company expressed sincere respect and grati-
al skill level assessments- tude to workplace mentors. The activity further
covering intermediate Vocational Skill Assessment strengthened the corporate mentor culture of
engineer professional titles e-commerce specialists welders forklift operators and other professional cate- gratitude and mutual support and advanced the
gories. The event not only supports employees in obtaining officially recognized professional qualifications development of a learning-oriented organization.but also empowers the Company to build a diversified talent development ecosystem and enhance the
overall competency of the team. Internal Mentor Team
159 160Sustainability Report 2025
Digital Learning Platform Construction VicePresident Chief Expert
Loctek actively promotes the construction of a digital learning Senior Expertplatform and has built an intelligent learning system — “LeX- DirectorueTang”. Integrating multiple functions including online course
learning digital examination training management and knowl- Director ChiefEngineer
edge accumulation the platform offers a rich curriculum sys-
tem that meets the differentiated learning needs of employees Senior Senior
at all levels and across all positions. It continuously empowers Manager Engineer
individual career development and organizational capability im-
provement realizing coordinated growth of employees and the AdvancedLeXueTang Online Training Platform Manager Engineer
Company.Supervisor IntermediateEngineer
As of the end of the reporting period
Specialist Engineer
LeXueTang has covered all employees with a total of 9423 online courses including
existing resources and independently developed internal courses. Assistant AssistantMana Trac
k Engineer
gerial a
l
T nr oac fess
i
k Pro
Metric Unit 2025
Dual Career Pathways
Employee Training Investment Ten thousand Yuan 143
Key Performance
Training Investment per Employee Yuan 360
Training Investment per Million Yuan Ten thousand Yuan / Million Yuan As of the end of the reporting period the Company has 66 employees with senior professional
Revenue Revenue 0.02
titles and 153 employees with intermediate professional titles.Number of Training Sessions Sessions 565
Total Number of Employees Trained Persons 3974
Total Number Number of Employees with Job
Total Attendance (Person-Times) Person-Times 31075 Category of Employees Grade Promotion Compared to Promotion Rate
Same Period Last Year
Employee Training Coverage Rate % 100 Non-Operational 1824 179 9.81%
Total Training Hours Hours 757 Operational 2417 77 3.19%
Average Training Hours per Employee Hours 32 Total 4241 256 6.04%
Note: The total headcount of operational and non-operational staff includes both active and separated employees.Establish Career Development Pathways
The Company has formulated the Implementation and Management Measures for the Striver Improvement Program
The Company has formulated the Employee Promotion Management System to design career development pathways and established a special competency improvement mechanism for employees with continuous underperformance. The
tailored to job requirements and personal conditions for employees. It has established a dual promotion channel for Company assists employees in identifying competency deficiencies and formulating personalized improvement plans.management and professional tracks helping employees realize their personal value. Over the past three years internal For those who fail to meet job performance standards after targeted coaching and support the Company will launch
promotion has achieved remarkable results with nearly half of middle and senior managers promoted from within the diversified adjustment measures including job transfer assessment to continuously optimize the allocation of human
Company. Going forward the Company will further clarify career development pathways and attract more dynamic and resources. The mechanism fully embodies the talent management philosophy of “strict management and sincere care”
innovative talents to join. and promotes the mutual growth of the organization and employees.
161 162Sustainability Report 2025
Promoting Business for Good
through Public Welfare
Company Actions
Public Welfare and Charity
Educational Access
Universal Participation in Charity
Community Communication and Exchange
Support for Rural Revitalization
Belt and Road Initiative Participation
Local Community Development
SDGs
163 164Sustainability Report 2025
Public Welfare and Charity Case Loctek Innovation and Entrepreneurship Fund at the University of Nottingham Ningbo China
On March 16 the University of Nottingham Ningbo China held the award ceremony for the 2024–2025
Upholding the philosophy of business for good Loctek has established a cultural communication center to deeply Loctek Innovation and Entrepreneurship Scholarship. A total of 16 participating teams and individuals
integrate philanthropy into corporate culture. The Company coordinates its subsidiaries and branches to carry out a full received honors.range of public welfare and charitable initiatives. Loctek has set up a RMB 40 million Leshan Charitable Fund under
the Yinzhou Charity Federation specially dedicated to student grants faculty scholarships poverty alleviation rural
revitalization and other charitable causes. We have also formulated institutional arrangements to ensure sustainable
financial and human resource input into philanthropic undertakings and consistently fulfill our corporate social
responsibilities.Key Performance
During the reporting period Loctek made total charitable donations of RMB 2.118
million and launched a total of 9 public welfare and charitable initiatives.
2024-2025 Academic Year Loctek Innovation and Entrepreneurship Award
Ceremony at the University of Nottingham Ningbo China
Educational Access
Case The 19th Consecutive Year! Loctek & Ningbo University Hold Successful Award Ceremony for the RMB 10 Million Innovation and Entrepreneurship Scholarship Program
On April 17 Ningbo University held the 2023–2024 Outstanding Student Commendation Ceremony during
The Loctek Scholarship was initially established in 2024 by Mr. Lane Shaw Founder and Chairman of Loctek and an
which the awarding ceremony of the Loctek Innovation and Entrepreneurship Scholarship was concurrently
outstanding alumnus of the 1993 physics cohort at Ningbo University. The scholarship aims to support students from
held. A total of 118 students received the scholarship.disadvantaged backgrounds and reward outstanding talents. In 2016 Loctek set up the Loctek Innovation Incentive
Fund at Ningbo University. In 2021 the Company further donated RMB 10 million to boost the development of
education. As of the end of the reporting period the scholarship program has been awarded for 19 consecutive years
across multiple disciplines benefiting more than 1000 teachers and students in total.Under the leadership of Chairman Lane Shaw Loctek has successively established scholarships and teaching grants
at Ningbo University of Technology Ningbo Institute of Technology Zhejiang University the University of Nottingham
Ningbo China and other higher education institutions benefiting over 2500 teachers and students in total. At present
Loctek’s annual investment in scholarship programs stands at approximately RMB 2 million.Support University Innovation and Entrepreneurship
In 2022 Loctek optimized the selection mechanism of its innovation scholarships. By providing more internship
opportunities and strengthening academic research guidance the Company encourages college students to engage
in innovation and entrepreneurship practices and supports university talent development. In 2025 Loctek further At the 2023–2024 Outstanding Student Commendation Ceremo-ny of Ningbo University representatives from Loctek presented
deepened cooperation with Ningbo University Ningbo Institute of Technology Zhejiang University the University awards to the winning students.of Nottingham Ningbo China and other higher education institutions. More than 359 students and research teams
participated in research projects effectively enhancing students’ practical capabilities and scientific research literacy
and earning wide recognition from all sectors of society.
165 166Sustainability Report 2025
Educational Equity Case 2025 Merit and Student Support Program at Maoshan Primary School
Committed to advancing educational equity Loctek launched the Ya’an paired student aid program in 2013 providing On February 13 Maoshan Primary School in Jiangshan Town held its new semester opening ceremony.an annual grant of RMB 10000 per beneficiary until their graduation from university. The first batch of seven sponsored Representatives of Loctek presented certificates and gifts to students awarded the Loctek Scholarship.students have all successfully graduated and entered the workforce. In 2022 the Company launched the second phase
of the Ya’an student aid program supporting seven students affected by the September 5 Luding earthquake.In November 2022 Loctek launched the Merit Scholarship and Student Aid Program at Maoshan Primary School in
Jiangshan Town Yinzhou District Ningbo. The funds are mainly raised through the company’s Employee One-Day
Charity Donation campaign. As Loctek’s flagship initiative for universal philanthropy the program marks a meaningful
shift from corporate-led charity to broad employee participation serving as an important platform for all staff to engage
in public welfare on a regular basis.Since the launch of the program Loctek has donated a total of over RMB 256311.A total of
256 students have received merit scholarships and 31 students have been granted paired financial
assistance. The initiative has gained wide recognition and positive responses from the local community.Inspired by Loctek’s philanthropic efforts a local Taiwanese resident established the “Shen FamilyScholarship” forming a heartwarming story of kindness and public welfare inheritance. Scene of the 2025 Loctek Scholarship Award Ceremony at Maoshan Primary School
Case 2025 Financial Aid Disbursement – Phase II Ya’an Student Support Program
On January 21 representatives of Loctek visited Shimian County in Sichuan Province and jointly held a
scholarship distribution ceremony with the Communist Youth League Shimian County Committee. Each
Case April “Happy Growth” Loctek & Maoshan Primary School Pairing Assistance Public of the seven paired students received a scholarship of RMB 10000 together with a winter care package Welfare Activity
including gloves a hat a scarf and a thermos cup.On April 20 Loctek launched a spring paired student aid public welfare activity for Maoshan Primary
School. The Company organized 20 aided students to visit the Ningbobang Museum where they
learned the pioneering and striving spirit of “daring to be the first in the world” embodied by the Ningbo
merchants. Afterwards the students participated in nature study activities at Ningbo Botanical Garden.They explored natural scenery created leaf artworks and made plant specimens acquiring knowledge
and growing happily through immersive practical experience.April “Happy Growth” Paired Student Aid Public Welfare Activity (Loctek & Maoshan Primary School)
Scene of the 2025 Student Aid Grant Ceremony held by Loctek in Shimian County
167 168Sustainability Report 2025
Case November “Happy Growth” Paired Student Aid Public Welfare Activity (Loctek & Maoshan Primary School) Case Loctek’s “Charity One-Day Donation” EventOn November 23 Loctek held an autumn paired student aid public welfare activity for Maoshan Primary On June 27 Loctek launched the 2025 “One-School. The aided students visited the Life Science Museum to learn popular science knowledge about Day Charity Donation” campaign. Employees
the origin of life and participated in the interesting course “Exploring the Secrets of Sports”. Integrating from the Company’s subsidiaries and
education with entertainment the activity enabled children to acquire new scientific knowledge through branches worldwide responded actively and
immersive exploration enrich their horizons and support their happy growth and all-round development. donated generously to deliver kindness. The
campaign realizes the global dissemination
of corporate philanthropic culture and serves
as an innovative practice of the universal
philanthropy concept. All raised funds will be
specially allocated to the Merit and Student
Support Program at Maoshan Primary School
continuously supporting the development of Loctek’s “Charity One-Day Donation” Event
local basic education.Community Communication and Exchange
Loctek deeply promotes community co-construction and actively integrates into local community governance
through regular communication and interaction. Focusing on residents’ practical needs and livelihood concerns the
November “Happy Growth” Paired Student Aid Public Welfare Activity (Loctek & Maoshan Primary School) Company strengthens collaboration with community stakeholders and launches diverse people-benefiting initiatives to
continuously enhance residents’ well-being and sense of gain. Rooted in the local community Loctek fulfills corporate
social responsibilities and empowers the harmonious stable and high-quality development of communities.“Future” Education Fund Case Health Awareness Campaign
In May Loctek carried out public welfare spine health popularization activities in local communities of
In September 2024 the Zhan Future Education Fund was initiated by the People’s Government of Zhanqi Town Yinzhou Ningbo. The employee volunteer team systematically explained the basic structure of the spine prevention
District Ningbo. Loctek set up a designated naming fund of RMB 2 million with an annual contribution of RMB 100000. knowledge of common spinal diseases and daily maintenance skills for community residents. On-site
The fund is used to reward outstanding teachers and students and support students from needy families in five schools guidance was provided for residents to practice spine health exercises designed for office workers. With
within Zhanqi Town and Yinzhou Economic Development Zone contributing to the high-quality development of local simple and practical movements the activities effectively helped residents relieve neck shoulder and
education. spinal pressure popularized scientific and healthy lifestyles and practically served the livelihood needs of
the community.Universal Participation in Charity
Universal philanthropy serves as an important part of advancing common prosperity. The Company strives to build a
philanthropic culture with Loctek characteristics. In 2025 it held the 4th “One-Day Charity Donation” campaign and
organized the Loctek Volunteer Team to participate in large-scale volunteer services. Through internal advocacy and
external media coverage the Company guides employees to pay attention to embrace and engage in philanthropy Spinal Health Awareness Campaign
fostering a positive atmosphere of universal kindness and public welfare participation.
169 170Sustainability Report 2025
Support for Rural Revitalization Local Community Development
Loctek actively responds to the national initiative of comprehensively promoting rural revitalization and consolidating In the process of global business expansion Loctek actively fulfills overseas social responsibilities respects local
the achievements of poverty alleviation and supports rural development in diversified ways. In 2022 the Company cultures of project locations integrates into local communities creates economic and social value for local regions
participated in the “Ten Thousand Enterprises Revitalizing Ten Thousand Villages” paired assistance program for central and promotes common development. In 2020 Loctek donated protective garments to Kaiser Alameda Hospital in San
and western China. It formed a partnership with Ribuzuo Village Xiqiu Township Muli Tibetan Autonomous County Francisco USA and continued to deepen cooperation with local community organizations. It donated ergonomic chairs
Liangshan Sichuan. Long-term friendly cooperation has been established in economic development rural revitalization to the Variety Boys & Girls Club to improve its office environment for teenagers further expanded the scope of public
and grass-roots Party building continuously empowering rural revitalization in ethnic minority areas. welfare efforts and established ties with more local community institutions.Loctek innovates the rural assistance model and fulfills social responsibilities by supporting farmers through purchasing
instead of donating by targeted procurement of agricultural and sideline products from underdeveloped areas.The purchased products are distributed as employee benefits or presented to groups who have made outstanding Case Care in Motion: The Company Supports Sports Development in the Apple Valley Community
contributions to society. By virtue of consumption-based assistance the Company effectively helps to increase farmers’
income empowers rural industrial development and delivers long-term public welfare value.On February 11 the Company donated 10000 US dollars to the Apple Valley Marathon Organizing
Committee in the United States specially supporting the holding of the annual marathon and the
Case Baoxing Mountain Delicacies Public Welfare Supermarket – Procurement of Agricultural Spe-cialty Products to Support Farmers development of community public sports. The donation effectively boosts local public health and sports
culture construction and enhances the company’s local brand image and community engagement and
further deepens long-term cooperative ties with local organizations.On July 16 the Company carried out
consumption-based rural assistance by
purchasing agricultural products worth
nearly RMB 50000 from the Baoxing
Shanzhenhui Public Welfare Supermarket.This purchase marks the largest single order Case Public Welfare Partnership: FlexiSpot Cooperates with Apple Valley Fire Department to Safe-
since the supermarket’s establishment guard Occupational Health
over the past four years boosting the high-
quality development and income growth
of rural characteristic industries through On May 12 FlexiSpot Inc. donated
practical consumption support. ergonomic massage chairs and other
suppl ies to the Apple Va l ley F i re
Department in the United States. These
Banner Presented by Baoxing Shanzhen Public Welfare
Supermarket products are dedicated to helping
frontline firefighters rest recover and
receive rehabilitation training after duty
Belt and Road Initiative Participation effectively reducing the risk of long-term occupational health injuries. The donation
further strengthens the connection
between the company and local public
Guided by the Belt and Road Initiative proposed by General service organizations and lays a solid
Secretary Xi Jinping Loctek has actively acted upon this vision foundation for in-depth cooperation in
and invested in the construction of its manufacturing base in community public welfare in the future. Donation Ceremony at Apple Valley Fire Department USA
Vietnam in 2016. In 2025 the Loctek Vietnam Manufacturing
Base will maintain steady growth creating a large number
of local jobs promoting the improvement of the industrial
chain elevating local living standards and facilitating cultural
exchanges and cooperation. Meanwhile the company’s global
customer service center in the Philippines has continuously
optimized its services with a stable workforce of approximately
150 employees providing higher-quality and more efficient
services to customers worldwide and consolidating cooperation
between China and the Philippines in the service sector. Global Service Center in the Philippines
171 172Sustainability Report 2025
Appendix
Index of Key Performance
Table of ContentsTable of Contents Guidelines No. 17 of Shenzhen Stock Exchange for Self-Reg- Guidelines for Chinese Enterprises’ Sustainable Sustainability Reporting Standards ulation of Listed Companies – Sustainability Report (Trial) Development Reports (CASS-ESG 6.0) (“GRI Standards”)
Foreword Art. 4 / Art. 6 P1.1/P1.2 102-6/102-10/102-45/102-46/102-52/105-50/2-1/2-2/2-3
Message from the Chairman / P2.1 /
About Us Art. 6 P3.1/P3.2/P3.3 102-6/102-10
Overview of 2025 Outstanding Achievements / A2 /
G1.1.1/G1.1.2/G1.1.5/G1.1.6/G1.1.7/G1.18/G1.1.9/G1.1.10/G1.1.11/G1.2.3/G1.2.4/
Sustainability Governance Art. 51 / Art. 52 / Art. 53 2-22/2-29/3-1/3-2/3-3
G1.3.1/G1.3.2
Special Topic: ESG Practices of Lecangs / / /
Corporate Governance Art. 51 / 102-18/102-22/102-24/2-9/2-12/2-13
Investor Relations Management / / /
Integrity and Com-
pliance: Strength-
ening Sustainable Compliance and Risk Control / / 102-15
Governance
Business Ethics and Anti-corruption Art. 54 / Art. 55 / Art. 56 G2.1.1/G2.1.2/G2.1.3/G2.1.8/G2.2.1/G2.2.2 205-3/206-1
Information Security and Privacy Protection Art. 48 S3.4.1/S3.4.2/S3.4.3/S3.4.4 418-1
Response to Climate Change Art. 20/Art. 21/Art. 22/Art. 23/ 第 Art. 24 E1.1.1/E1.1.2/E1.1.3/E1.1.4/E1.1.6/E1.1.7/E1.1.8/E1.1.12/E1.1.13/E1.1.15/E1.1.16 305-1/305-2/305-4/305-5
Green and Climate Action Art. 20 / Art. 21 / Art. 22 / Art. 23 / Art. 24 / Art. 27 / Art. 28 / Art. 32 E3.3.2/E3.3.3/E3.3.6 /
Low-Carbon Devel-
opment for Envi-
ronmental Sustain- Environmental Management Art.29 / Art.30 / Art.31 / Art.33 E2.1.1/E2.1.2/E2.1.3/E2.1.5/E2.1.6/E2.1.7/E2.1.8/E2.1.9/E2.2.1/E2.2.2/E2.2.3/
ability E2.2.4/E2.2.5/E2.2.6/E2.2.7/E2.4.1/E2.4.2/E2.4.3/E2.4.4/E3.3.4
306-1/306-2/306-3/306-5
Resource Efficiency Art. 34 / Art. 35 / Art. 36 / Art. 37 E3.1.1/E3.1.2/E3.1.3/E3.1.4/E3.1.5/E3.2.1/E3.2.2/E3.2.3/E3.2.4 301-1/302-1/302-2/302-3/302-5/303-4/303-5
173 174Sustainability Report 2025
Self-Regulatory Guidelines No. 17 for Listed Companies of
Table of ContentsTable of Contents Guidelines for Sustainability Reporting of Chinese the Shenzhen Stock Exchange — Sustainability Report (For GRI Sustainability Reporting Standards Enterprises (CASS-ESG 6.0)
Trial Implementation) (GRI Standards)GRI
R&D System Construction Art. 41 / Art. 42 / Art. 43 S2.1.1/S2.1.2/S2.1.4/S2.1.5/S2.1.6/S2.1.7 /
Advancing New Quality Productive
Forces Art. 42 S2.1.3/S2.1.12/S2.1.13 /
R&D Quality: Driving Sustain- Intellectual Property Protection Art. 42 S2.1.9/S2.1.10/S2.1.11 /
able Development Through
Innovation
Product Quality Assurance Art. 47 S3.3.1/S3.3.2/S3.3.3/S3.3.4/S3.3.5 416-1/416-2
Quality Service Art. 47 S3.3.6 417-1/417-3
Sustainable Supply Chain Art. 45 S3.1.1/S3.1.2/S3.1.3/S3.1.4 308-1/308-2/414-1
Diversity and Inclusion Art. 50 S4.1.1/S4.1.3/S4.1.9/S4.1.11 401-1/405-1
Compensation and Benefits Art. 50 S4.1.5 404-3
Protect Employees’ Rights and In-
terests Art. 50 S4.1.4/S4.1.6 406-1/408-1/409-1
Empowering Employees and
Fostering Inclusive Growth Democratic Governance Art. 49 / Art. 50 S4.1.8/S4.1.12 /
Employee Wellbeing Art. 50 / 401-2
Occupational Health and Safety Art. 50 S4.2.1/S4.2.2/S4.2.3/S4.2.4/S4.2.5/S4.2.6 403-1/403-3/403-5/403-6/403-8/403-9/403-10
Employees’ Development Art. 50 S4.3.1/S4.3.2/S4.3.3/S4.3.4/S4.3.5/S4.3.6 404-1
Public Welfare and Charity Art.40 S1.2.1/S1.2.2/S1.2.5/S1.2.6 /
Educational Access Art.40 / /
Universal Participation in Charity Art.40 / /
Community Communication and
Exchange Art.40 / /
Promoting Business for Good
through Public Welfare Support for Rural Revitalization Art.39 S1.1.2 /
Belt and Road Initiative Participa-
tion Art.40 / /
Local Community Development Art.40 / /
Index of Key Performance Art.57 A3 /
Appendix
Feedback Form / A6 /
175 176Sustainability Report 2025
Feedback Form
Dear readers
Thank you for taking the time to read this report. We highly value your feedback and would welcome
any comments or suggestions you may have. Your insights are instrumental in helping us continually
enhance our ESG disclosures and improve our ESG management practices. We sincerely appreciate your
contributions!
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You can contact us using the following contact information:
Address: No. 436 Xueshi Road Shounan Subdistrict Yinzhou District Ningbo City
Zhejiang Province China
Tel.: 0574-55007473
Email: law@loctek.com
177178
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