Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental Protection
• Social Responsibility
• Governance
• Supply Chain Due Diligence
• Community Engagement

Environmental Achievements

• Realized reduction of water consumption and wastewater discharge under increasing production capacity
• Upgraded unorganized waste gas emission of copper electrowinning process
• Completed and put into operation Huajin’s high salinity wastewater desalination treatment (MVR) project, realizing zero discharge of wastewater

Social Achievements

• Rated as “corporate social responsibility benchmarking enterprise (labor practice) in Zhejiang Province”,
• Practice of responsible governance of cobalt supply chain highly recognized by international organizations and famous manufacturers
• Successfully promoted supporting work between company headquarters and villages, winning social responsibility award for poverty alleviation and cooperation between East China and West China in Zhejiang Province
• Provided jobs for 8079 employees from 6 different countries, respecting and protecting labor rights
• Achieved 100% labor contract signing rate and 100% coverage rate of five insurances and housing provident fund for Chinese employees
• Improved the recovery system of retired power batteries
• Customer satisfaction in 2020 reached 83.72

Governance Achievements

• Improved corporate governance structure and standardized company operation
• Established a corporate social responsibility executive committee
• Established an independent social responsibility office and audit and supervision department
• Handled 12 reports and investigations, completing one corruption investigation
• Implemented cadre management system

Climate Goals & Targets

Environmental Challenges

• Large energy consumption in production with limited renewable resources
• Insufficient ability of some upstream suppliers and weak awareness of corporate social responsibility
• Immature corporate social responsibility standards in the cobalt industry
• Complex supply chain situation
• Difficulties in obtaining complete documentation from suppliers for due diligence audits

Mitigation Strategies

• Actively implementing ISO14001 environmental management system certification
• Strengthening management of material hazardous substance safety
• Improving supplier management system
• Communicating corporate social responsibility code of conduct to suppliers
• Conducting field evaluation on key suppliers
• Implementing enhanced due diligence management for identified suppliers
• Working with downstream stakeholders to standardize responsible manually mined cobalt projects
• Communicating and cooperating with downstream institutions specializing in LSM management

Supply Chain Management

Responsible Procurement

• Basic supplier code of conduct
• Corporate social responsibility checklist
• Spot audit of key and core suppliers

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Standards, ESG Reporting Guide, UN SDGs, ISO26000/GB/T36000-2015

Certifications: IATF16949 (Huahai New Energy Company), ISO14001 (Huayou Cobalt, Quzhou Huayou, Quzhou New Energy, Resource Recycling)

Third-party Assurance: Bureau Veritas

UN Sustainable Development Goals

• SDG 1
• SDG 2
• SDG 3
• SDG 4
• SDG 6
• SDG 8
• SDG 9
• SDG 10
• SDG 11
• SDG 12
• SDG 13
• SDG 16

Awards & Recognition

• Zhejiang overseas investment enterprise social responsibility anti-epidemic contribution award in 2020
• East-West China poverty alleviation cooperation social responsibility award in Zhejiang Province
• Ranking the No.303 place among top-500 China manufacturing private enterprises in 2020
• One of top-100 enterprises in Zhejiang Province
• A high-tech enterprise in Zhejiang Province
• Gaogong golden globe award: One of top 10 listed companies in 2020
• Nonferrous metal co-building unit of national technology standard innovation base
• Zhejiang science and technology progress award certificate: First prize
• A demonstration enterprise of recycling power battery resources in China
• Quzhou export famous brand
• Zhejiang invisible champion enterprise in 2020
• Special award of Quzhou Municipal Government in 2019: Industrial investment contribution award
• Major industrial project in Zhejiang Province
• AAAAA enterprise of performance evaluation of extended responsibility performance of power battery producer

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• Multiple factories obtained "zero-carbon" factory certification.
• Chengdu B&M became the world's first cathode material "zero-carbon" factory.
• Quzhou Huayou Resource Recycling Technology Co., Ltd. became the world's first resource recycling "zero-carbon" factory.
• Jiangsu Huayou Energy Technology Co., Ltd. became the world's first "zero-carbon" factory for power battery cascade utilization.
• Huayou New Energy Technology (Quzhou) Co., Ltd. became the first zero-carbon plant in the Company's precursor sector.
• Huayou Quzhou Industrial Park invested RMB 700 million in environmental protection facilities.

Social Achievements

• Established Huayou Charity and Common Prosperity Fund with RMB 50 million donation.
• Established Common Prosperity and Charity Fund with RMB 20 million donation.
• Donated RMB 500,000 to Huayou RMB 10 million Endowment Fund.
• Donated RMB 330,000 to "Chongxue Award" in Tongxiang Economic Development Zone.
• Invested over RMB 13 million overseas to support community development activities.
• Jointly donated IDR 5 billion (equivalent to RMB 2.2 million) for earthquake relief in Indonesia.

Governance Achievements

• Improved information disclosure systems.
• Enhanced corporate governance.
• Established anti-corruption mechanisms and education.
• Formulated the Company's General Outline of Internal Control Management.
• Established the Anti-commercial Bribery and Anti-Foreign Corruption Compliance Manual.
• Established the new Anti-corruption Promotion Liaison System.

Climate Goals & Targets

Environmental Challenges

• Climate change risks (physical and transitional risks)
• Supply chain disruptions

Mitigation Strategies

• Formulated a top-down climate change response plan.
• Released Huayou Cobalt's Dual Carbon Action Report.
• Formulated the Global Clean Power Plan.
• Implemented the "Six-step Approach" responsible supply chain management system.
• Carried out independent third-party audits.

Supply Chain Management

Responsible Procurement

• Supplier Code of Conduct
• RCI standards
• OECD guidelines
• Chinese Guidelines

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Standards, TCFD, OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas, Chinese Due Diligence Guidelines for Responsible Mineral Supply Chains

Certifications: ISO 14001, ISO 50001, ISO 45001, ISO 14064:2018, ISO 9001, IATF 16949, ISO 27001 (planned for 2023), PAS2060 (multiple factories)

Sustainable Products & Innovation

• 9-series single crystal product
• 6-series high-voltage power battery platform material
• 4.50V high-end lithium cobalt oxide

Awards & Recognition

• 2022 Zimbabwe Best Investment Deal Award
• Fortune China 500 ESG Pioneer Award
• Tianjin Science and Technology Progress Award (first prize)

Environmental Metrics

ESG Focus Areas

• Climate Change
• Environmental Management
• Water Resource Management
• Pollutant Emission Management
• Biodiversity
• Tailing Management
• Circular Economy
• Corporate Governance
• Business Ethics
• Information Security and Privacy Protection
• Sustainable Supply Chain
• R&D Innovation
• Intelligent Manufacturing
• Product Responsibility
• Compliance and Employment Diversity
• Employee Training and Development
• Employee Compensation and Benefits
• Employees' Rights & Interests and Communication
• Occupational Health and Safety
• Community Investment
• Rural Revitalization
• Community Co-construction

Environmental Achievements

• Indonesia Huayue Nickel-Cobalt Hydrometallurgy Process Project improved resource utilization efficiency, increased output by 9%, decreased electricity consumption by 50%-70%, decreased water consumption per ton of nickel by 8.7 tons, and decreased carbon emissions per ton of nickel by 5%
• Four "zero-carbon" factories certified across the entire industrial chain
• CDP rating of B, higher than the Asian and industry average
• Clean power utilization accounted for 34%

Social Achievements

• Recruited 15,140 people
• Trade union/collective agreement coverage rate reached 100%
• 100% employees at occupational disease posts were subject to physical examination
• Completion rate for employee complaint 100%
• Incidence of occupational disease 0
• Charity donation with a total value of RMB 10.6906 million
• Established Mosque and Church for employees in Indonesia
• Arcadia Project in Zimbabwe created job opportunities for local residents

Governance Achievements

• Established a sound ESG governance structure
• Passed ISO 37001 anti-bribery management system certification
• Passed ISO 37301 compliance management system certification (Huayou Cobalt, Tianjin B&M, and Chengdu B&M)
• Conducted 48 anti-corruption training sessions with 5,375 attendees
• Conducted 869 anti-corruption promotion activities during festivals with 30,017 attendees
• Established the "You Zhi" Smart Audit System

Climate Goals & Targets

Environmental Challenges

• Climate change risks (extreme weather, rising temperatures)
• Transitional risks (stricter government policies, market changes, supplier risks)
• Water resource management challenges
• Waste management challenges
• Supply chain risks

Mitigation Strategies

• Developed emergency response plans for climate change
• Optimized resource acquisition and allocation
• Implemented water-saving and alternative measures
• Enhanced recycling and reuse of wastes
• Strengthened carbon emission management system
• Optimized supplier management
• Implemented due diligence management of mineral supply chain
• Released Green Cooperation Initiative to Suppliers

Supply Chain Management

Supplier Audits: On-site audits conducted on channel suppliers

Responsible Procurement

• Supplier Handbook
• Management Measures for Supplier of the Group's Procurement Center
• Policy for a Responsible Global Supply Chain of Minerals from High-Risk Areas
• Supplier Standards for Responsible Mineral Procurement
• Supplier Code of Conduct
• Green Cooperation Initiative to Suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events
• Rising average temperatures

Transition Risks

• Stricter government policies and regulations
• Market changes
• Supplier risks

Opportunities

• Emerging new energy and electrification markets
• Transition to renewable energy

Reporting Standards

Frameworks Used: GRI Standards (2021), UN SDGs (2030), CASS-ESG 5.0

Certifications: ISO 14001, ISO 45001, ISO 37001, ISO 37301, ISO 27001, TISAX

Awards & Recognition

• The 2023 National ESG & CSR Award of Zimbabwe Arcadia Project
• The Most Promising Enterprise in Carbon Neutrality
• 2023 Best Case of the Year in Technological Innovation
• Demonstration Enterprise
• The 1st China Reform Cup • ESG Golden Bull Award
• Ernst & Young's Sustainability Excellence Award
• China Listed Companies' Top 100 Best Practices in Co-Building the Belt and Road Initiative
• Bluetech Carbon Neutrality Pioneers Award nomination
• “Zero Carbon Pioneer Case” award from 36Kr
• “13th, 2023, China Battery New Energy Industry Annual Innovation Award”

Environmental Metrics

ESG Focus Areas

• Carbon reduction
• Resource recycling
• Community investment
• Responsible Minerals Initiative (RMI)
• United Nations Global Compact (UNGC)

Environmental Achievements

• Carbon emissions of mainstream products decreased by an average of 12% compared with the previous year.
• Self-generated photovoltaic power station generated 4.59 million kwh, achieving a carbon reduction of 2,617 tons.
• 121.83 million kwh of waste heat power generation and a carbon reduction of 158,379 tons.
• 2.11 million cubic meters of water were recovered in Indonesia.
• Rainwater reuse in Indonesia decreased new water consumption by 26%, recovering 980,000 cubic meters of rainwater and reducing carbon emissions by 460 tons.
• 14 subordinate units completed carbon emission verification at the organizational level; carbon footprint accounting based on CTW was completed for 20 products.

Social Achievements

• Invested RMB 5.2 million in various community building and public welfare activities.
• Donated RMB 300,000 to Tongxiang Senior High School and RMB 4.5 million to the Science and Technology Museum of Tongxiang Youth Training Base.
• Donated school supplies to primary schools in Xinjiang and Sichuan.
• Visited 39 families of poor family workers, 36 families in poor villages, and more than 80 people in nursing homes and leprosy hospitals.

Governance Achievements

• Constructed an ESG governance system in accordance with international first-class standards.
• Enhanced global ESG governance capabilities.
• Included in the China ESG New Establishment List of Fortune 2024 and won major awards of the 2024 IDX Channel ESG Award.
• Overseas ESG achievements were included in the 100 Best Practice Cases of Companies Listed in China following the Belt and Road Initiative in Ten Years.

Climate Goals & Targets

Environmental Challenges

• Slowdown in NEV demand growth.
• Increasingly competitive industry environment.
• Fluctuations in metal prices (nickel, cobalt, lithium, copper).
• Risks from fluctuations in foreign currency exchange rates.
• Stringent environmental protection standards.
• Uncertainty in technology R&D.
• Management risk associated with transnational and trans-regional operations.
• Risks of transnational business due to uncertainties in industrial policies, politics, economy, regulation, and law in various countries.
• Risk of overcapacity in the power battery and lithium-ion battery materials industry.

Mitigation Strategies

• Maintaining strategic focus and implementing a business approach centered on comprehensive coordination, structural optimization, technological support, cost reduction, and efficiency improvement.
• Following working principles of enhancing stability and achieving success through improvement.
• Vigorously pursuing the competitive strategy of “two leadership positions”, the business strategy of “to be among the best”, and the development strategy of “beneficial collaboration and a win-win future”.
• Continuously integrating into the global new energy industry supply system.
• Steadily promoting the global layout of industry chain integration, advancing management reform, and deepening ESG global governance.
• Implementing carbon-reducing and carbon-dropping processes and energy structure substitution to promote the green and low-carbon transformation of the industrial chain.
• Improving management capacity and governance level.
• Reducing financing costs and optimizing financing structure.
• Ensuring capital chain safety and effectively managing capital expenditures.
• Actively participating in global resource allocation and integrating into the global industrial division.

Supply Chain Management

Climate-Related Risks & Opportunities

Awards & Recognition

• China ESG New Establishment List of Fortune 2024
• 2024 IDX Channel ESG Award