Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental Protection
• Working Environment and Safety, Occupational Health and Training
• Corporate Governance
• Community Involvement, Services and Responsibilities

Environmental Achievements

• Reduced energy consumption through equipment upgrades and advanced technologies.
• Reduced water consumption through water-saving measures.
• Reduced coal consumption by using flax ash as biofuel.
• Implemented recycling and reuse of packaging materials.
• Established a green working environment by planting trees and landscaping.

Social Achievements

• No work-related fatal accidents.
• Provided various employee benefits including basic insurance coverage, seasonal benefits, service allowance, education allowance, meal and housing allowance.
• Organized various staff activities to boost morale.
• Donated to local charity federations and community projects.
• Supported national education initiatives.

Governance Achievements

• Implemented a comprehensive system of internal control and stringent policies for anti-corruption and anti-fraud.
• Obtained ISO14001, OEKO-TEX Standard 100, and other certifications.
• Maintained long-term strategic relationships with responsible suppliers.
• Developed procedures to handle customer complaints and product recalls.

Climate Goals & Targets

Environmental Challenges

• Reducing emissions from production processes.
• Efficient use of resources.
• Maintaining high employee retention rates.

Mitigation Strategies

• Investing in environmental protection equipment and technologies.
• Implementing water-reduction and energy-saving measures.
• Recycling and reusing flax ash and other waste materials.
• Offering competitive employee benefits and engaging staff through various activities.

Supply Chain Management

Supplier Audits: Regular reviews on supplier performance.

Responsible Procurement

• Long-term relationships with suppliers with good credit history, solid reputation, high product quality, and environmental compliance.

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: ESG Reporting Guide (Appendix 27 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited)

Certifications: ISO14001, OEKO-TEX Standard 100, Global Organic Textile Standard (GOTS), Organic linen certification, ISO 9001

Environmental Metrics

ESG Focus Areas

• Environmental Protection
• Social Responsibility
• Corporate Governance

Environmental Achievements

• Reduced average water consumption per tonne of yarn by 34%
• Reduced average coal consumption per tonne of yarn by 31.8%
• Reduced average steam consumption per tonne of yarn by 9.6%
• Reduced average electricity consumption per tonne of yarn by 0.95%
• Planted over 10,000 trees
• Environmental protection expenditure of completed projects approximately RMB 8.55 million

Social Achievements

• Customer satisfaction rate rose to 4.45 out of 5
• 100% return rate of employees who took maternity leave
• Organized various staff activities promoting well-being and team building
• RMB 1,080,000 spent on staff training and development

Governance Achievements

• Established a robust risk management system
• Implemented advanced management models (lean management, performance excellence)
• Obtained ISO9001 and ISO14001 certifications
• No occurrence of corruption, bribery, or other compliance incidents in 2015

Climate Goals & Targets

Environmental Challenges

• Maintaining a balance between economic growth and environmental protection
• Managing water resources effectively due to production expansion
• Ensuring consistent compliance with labor standards and regulations

Mitigation Strategies

• Investing in environmental protection equipment and technologies
• Implementing water-saving measures (reuse of scouring water, collection of condensation water)
• Conducting regular work safety checks and providing comprehensive training

Supply Chain Management

Responsible Procurement

• Sourcing 100% of raw materials from Europe
• Requiring certificates of origin, plant quarantine, and insurance coverage from suppliers

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI G4

Certifications: ISO 9001, ISO 14001, OEKO-TEX Standard 100

Sustainable Products & Innovation

• 26Nm Cashmere/Silk/Linen blended yarn
• 36Nm Silk/Linen blended yarn

Awards & Recognition

• Outstanding Corporate Social Responsibility Report of Zhejiang Province (2014)

Environmental Metrics

ESG Focus Areas

• Environmental Protection
• Social Responsibility
• Corporate Governance

Environmental Achievements

• Replaced all coal-fired boilers with gas-fired boilers, significantly reducing air pollutant emissions.
• Installed new solar generators at Zhejiang Jinda, generating 15% of the plant's electricity.
• Reduced coal consumption by 22% and 21% in total and per tonne of yarn respectively at Zhejiang Jinyuan.

Social Achievements

• Continued support for Kingdom Hope Primary School.
• Organized volunteer visits to elderly homes.
• Improved employee satisfaction rate to 4.53 out of 5.

Governance Achievements

• Obtained ISO9001, ISO14001, OEKO-TEX Standard 100, and GOTS certifications.
• Established a national linen yarn research institute.
• Maintained detailed operating procedures, codes of conduct and reward and punishment systems.

Climate Goals & Targets

Environmental Challenges

• Fluctuations in the world market.
• Fierce market competition.

Mitigation Strategies

• Investing over RMB 20 million in energy saving and emission reduction initiatives.
• Constantly improving staff communication, execution, leadership, and problem-solving skills.
• Establishing new production plants inside and outside China and rolling out new products.

Supply Chain Management

Supplier Audits: Annual

Responsible Procurement

• Supplier Selection and Evaluation Procedures
• Requires certificates of origin and plant quarantine

Climate-Related Risks & Opportunities

Physical Risks

• Typhoons and other natural disasters

Transition Risks

• Changes in custom duty rates
• Sudden surge in raw material prices

Opportunities

• Development of energy-efficient products

Reporting Standards

Frameworks Used: GRI G4, HKEx ESG Reporting Guide

Certifications: ISO 9001, ISO 14001, OEKO-TEX Standard 100, GOTS

Environmental Metrics

ESG Focus Areas

• Sustainable Linen
• Environmental Protection
• Workplace Safety
• Occupational Health
• Employee Training
• Community Responsibility
• Corporate Governance

Environmental Achievements

• Reduced GHG emissions by 33% compared to 2015 by replacing coal-fired boilers with natural gas steam boilers.
• Zhejiang Jinyuan and Zhejiang Jinda plants' solar generators produced 3.6% and 12% of their electricity consumption, respectively.
• Reduced steam wastage in pipes by optimizing scouring and bleaching techniques and steam pipes.

Social Achievements

• Implemented an annual leave system, granting 539 days of leave to 127 employees.
• Provided leadership workshops and training on sustainable compliance with labor laws to middle and senior staff.
• Continued support for Kingdom Hope Primary School.

Governance Achievements

• Officially joined the Business Social Compliance Initiative (BSCI) and Zero Discharge of Hazardous Chemicals (ZDHC) Programme.
• Obtained ISO9001 Quality Management Systems and ISO14001 Environmental Management System certifications.
• Granted 1 utility model patent, bringing the total number of patents to 56.

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions
• Financial risks
• Climate change risks
• Occupational safety risks

Mitigation Strategies

• Regularly collected market price data and conducted internal production and sales conferences.
• Monitored changes in customs duty rates and increased exports to duty-free countries.
• Used foreign exchange forward contracts and derivative financial instruments to hedge foreign exchange risks.
• Maintained back-up power and water supplies and kept 6-month raw material stocks.
• Provided occupational safety seminars, fire response training, and monitoring and guidance on machinery operation.

Supply Chain Management

Supplier Audits: Annual

Responsible Procurement

• Supplier Selection and Evaluation Procedures

Climate-Related Risks & Opportunities

Physical Risks

• Typhoons and other natural disasters

Transition Risks

• Sudden surge in raw material prices

Reporting Standards

Frameworks Used: GRI G4

Certifications: ISO9001, ISO14001, OEKO-TEX Standard 100, GOTS

Sustainable Products & Innovation

• Double nature/single nature linen yarn
• Peony linen yarn

Environmental Metrics

ESG Focus Areas

• Green operation
• Energy/resources consumption and emission
• Greenhouse gas emission
• Management of domestic wastes
• Environmental investment
• Sustainability performance
• Anti-corruption
• Risk Management
• Whistle-Blowing Policy/Grievance Channel
• Quality and compliance certification
• Patents
• Supply chain management
• Customer Satisfaction
• Customer Information Security and Privacy Policy
• Customer complaints
• Remuneration System
• Prohibition of child and forced labour
• Rights and Interests of employees
• Employees’ training and development
• Labour Relations
• Community Responsibilities

Environmental Achievements

• Solar photovoltaic generators contributed 3.8% of the electricity consumed by all the factories of the Group
• Annual consumptions of electricity, water, steam and natural gas decreased by 7.0%, 6.1%, 12.5% and 6.8% respectively
• Achieved carbon neutrality in November 2023 (independently verified by SGS)
• Environmental investment and expenditure approximated RMB21.3 million during the year

Social Achievements

• Overall customer satisfactory rate at 4.55
• Return rate of employees who took maternity leave without pay during pregnancy was 80%

Governance Achievements

• No case in relation to corruption, bribery, blackmail, fraud and money-laundering, legal actions for anti-competitive behaviour, anti-trust, and monopoly practices

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions
• Climate change risks
• Occupational safety risks
• Financial risks

Mitigation Strategies

• Maintain close communication with European suppliers to ensure compliance with local environmental protection policies
• Back-up power and water supplies are well maintained
• Keeps 6-month raw material inventories
• Occupational safety seminars, fire prevention and response training, monitoring and guidance on machinery operation are provided regularly
• Closely monitors changes in custom duty rates around the world and exports to duty-free countries will be increased accordingly
• Foreign exchange forward contracts and derivative financial instruments may be adopted to hedge foreign exchange risks

Supply Chain Management

Supplier Audits: Annually

Responsible Procurement

• Supplier Selection and Evaluation Procedures

Climate-Related Risks & Opportunities

Physical Risks

• Typhoons and other natural disasters

Reporting Standards

Frameworks Used: GRI, HKEx ESG Reporting Guide

Certifications: ISO9001, ISO14001, ISO 50001, GB/T45001-2020/ISO 45001:2018, OEKO-TEX Standard 100, GOTS, OCS, EUROPEAN FLAX® Standard

Third-party Assurance: SGS (Carbon Neutrality)

Sustainable Products & Innovation

• REEL Linen

Awards & Recognition

• China Best ESG Employer by Aon
• National-Level Green Factory (Heilongjiang Kingdom)