Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Implemented the Three-Year Action Plan to Win the Blue Sky Defense War, strictly implemented peak averting production and production optimization for environmental protection, promoted policies in the elimination of outdated production capacity and old equipment replacement with better efficiencies
• 28 subsidiaries carried out ultra-low emission transformation, and all of them met the emission standards
• Utilized more than 93.40 million tonnes of solid waste
• Achieved zero wastewater discharge in several locations through water recycling initiatives
• Generated 9.403 billion kWh of electricity through waste heat recovery for power generation, leading to a consumption reduction of 1.1557 million tonnes of standard coal and an emission reduction of 3.0279 million tonnes of carbon dioxide

Social Achievements

• Maintained workplace diversity with a male to female employee ratio of approximately 3.27
• Implemented various employee welfare measures, including sick leave, personal leave, marriage leave, maternity leave, paid annual leave, and statutory holidays
• Organized various cultural and sports events to enrich employees’ cultural life and enhance team cohesion
• Actively promoted localized employment in overseas projects, with local workforce accounting for a significant percentage in several locations
• Established an employee development and training platform with multiple channels and forms

Governance Achievements

• Established a sound system of punishing and preventing corruption
• Formulated a series of internal control management systems covering financial supervision, operational regulation, compliance supervision, and risk management
• Established a special whistleblowing system to ensure the independence and confidentiality of the complaint reporting process
• Improved the environmental, safety and health management system

Climate Goals & Targets

Environmental Challenges

• Complex domestic and overseas market environment
• Significant increasing risks and challenges in the domestic and foreign situation

Mitigation Strategies

• Deepened the “management of three delicacies”, promoting the “lean operation”, and continuously improving its profitability; promoting the “refinement of management”, and greatly improving management efficiency; and promoting the “simplification of the organization”, and strengthening and simplifying the management and work process
• Continued to deepen innovation, steadily carried out the pilot reform work, actively carried out the “Double Hundred Actions”, carried out in-depth reform of internal mechanisms, made new progress in building a platform for scientific and technological innovation, and made new breakthroughs in key technologies
• Strengthened internal integrity building through methods such as clearly identifying the inspection, assessment, responsibility and supervision mechanisms for the clean Party integrity building

Supply Chain Management

Supplier Audits: 19,659

Responsible Procurement

• Giving priority to partners with reliable quality, good business operational condition and good reputation, environmentally friendly and with scientific management
• Implementing green procurement, giving priorities to the products that are environmentally friendly and with low carbon emission during their production processes
• Giving priority to clean energy when conducting energy procurement

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: “Environmental, Social and Governance Reporting Guide” set out in Appendix 27 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, Guidelines to the State-owned Enterprises Directly under the Central Government on Fulfilling Corporate Social Responsibilities and Guidelines to the State-owned Enterprises on Better Fulfilling Social Responsibilities issued by the State-owned Asset Supervision and Administration Commission of the State Council

Sustainable Products & Innovation

• High-quality, green and low-carbon cement products
• Wind power blades
• Solar thin film battery modules
• Special cement products

Awards & Recognition

• “2019 Outstanding Issuer of Corporate Bonds of the Shanghai Stock Exchange”,
• “Most Honored Company” by Institutional Investor's All-Asia Executive Team in 2019
• “National Intellectual Property Advantage Enterprise in 2019”,
• “Model Pilot Enterprise of Integrated Development of Building Materials Manufacturing and the Internet in 2019”

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Total greenhouse gas emissions of 230.74 million tonnes, a 13% reduction year-on-year
• Nitrogen oxides emissions of 81,470 tonnes, a year-on-year decrease of 26.9%
• Sulfur dioxide emissions of 6,488 tonnes, a year-on-year decrease of 32.4%
• Industrial particulates emissions of 9,835 tonnes, a year-on-year decrease of 31.4%
• Utilization rate of recycled water reaching 92%, an increase of 4 percentage points year-on-year
• 685 plants certificated by ISO 14001 environmental management system certification
• 129 national green factories

Social Achievements

• Investment related to safety and health 1.57 billion yuan
• Total investment in philanthropy 106.50 million yuan
• volunteer activities 48,299 hours
• The average number of training hours for all employees 47 hours, an increase of 20.5% year-on-year
• Employee satisfaction rate of over 96%

Governance Achievements

• Established the ESG Committee of the Board
• Coverage of director in anti-corruption training 100%
• Coverage of employee in anti-corruption training 100%
• Number of corruption cases initiated and concluded against companies and employees is 0

Climate Goals & Targets

Environmental Challenges

• Stricter policies and supervision on existing products and services
• Pricing of greenhouse gas emissions
• More stringent emission and disclosure requirements
• Rising prices of raw materials and energy
• Market requirements for low-carbon environmental protection attributes of products are becoming increasingly stringent
• Reputation damage due to business practices
• Extreme weather such as floods and typhoons
• Increasingly hot and cold weather

Mitigation Strategies

• Keeping an eye on the latest relevant laws, regulations, regulatory requirements, and national targets
• Increasing the use of renewable energy
• Actively promoting the construction of green factories, green mines and ecological factories
• Analyzing the substitution risk of products
• Establishing ESG Committee and ESG Working Group
• Comprehensively and systematically analyzing typical cases of dealing with extreme weather
• Continuously monitoring relevant climate change-related risks

Supply Chain Management

Responsible Procurement

• The Group will give priority to the partners with reliable quality, good business operational condition and good reputation, environmentally friendly and with scientific management

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather such as floods and typhoons
• Increasingly hot and cold weather

Transition Risks

• Stricter policies and supervision on existing products and services
• Pricing of greenhouse gas emissions
• More stringent emission and disclosure requirements
• Rising prices of raw materials and energy
• Market requirements for low-carbon environmental protection attributes of products are becoming increasingly stringent
• Reputation damage due to business practices

Opportunities

• Production, transportation and distribution process with higher efficiency
• Use of recycling technology and less resource consumption
• Use of low-emission or renewable energy sources
• Participation in carbon trading market
• Use of new technologies
• Development and extension of low-emission products and services
• Development of solutions to climate change adaptation risks
• Availability of new products or services through R&D and innovation
• Enhancing ability to conduct diversified business activities
• Adoption of supportive incentive policies
• Market demand and initiatives
• Adaptability

Reporting Standards

Frameworks Used: Environmental, Social and Governance Reporting Guide (Appendix 27 to the Listing Rules issued by the Stock Exchange), Guidelines on Fulfilling Corporate Social Responsibilities of Central Enterprises, Guidelines to the State-owned Enterprises on Better Fulfilling Social Responsibilities, TCFD, SASB (Engineering & Construction Services sector)

Certifications: ISO 14001, ISO 45001, ISO 9000, ISO 50001

Third-party Assurance: CECEP (HK) Advisory Company Limited

UN Sustainable Development Goals

• Goal 7
• Goal 13

The Group has responded positively to the goals and diversified our actions to achieve sustainable development.

Sustainable Products & Innovation

• low-carbon cement
• wind turbine blade
• carbon fiber
• lithium battery separator
• hydrogen cylinders
• new graphite materials

Awards & Recognition

• Ranked No. 45 in Fortune (Chinese edition) “List of China's Top 500”
• Ranked first in the Most Honored Company in the Basic materials sector by Institutional Investor, “Asia-Pacific Company Management Team”
• Ranked first in the comprehensive strength ranking of “Listed Companies of Global Building Materials in 2022” by China Building Materials Federation
• Selected in Forbes “2022 China ESG 50” list
• Awarded Wind “ESG Hong Kong Stock Best Practice Award (Governance)” in 2022
• Won Sina Finance “The most ESG listed company in Hong Kong and US stocks” in 2022
• Selected in the Hang Seng Climate Change 1.5 ℃ Target Index

Environmental Metrics

ESG Focus Areas

• Climate Change
• Green Technology
• Resource Recycling
• Circular Economy
• Green Manufacturing
• Ecological Conservation
• Corporate Governance
• Employee Development
• Social Responsibility
• International Cooperation
• Supply Chain Management
• Human Rights
• Biodiversity

Environmental Achievements

• Total greenhouse gas emissions decreased year-on-year by 14.5% to 197.35 million tonnes.
• Nitrogen oxides emissions decreased year-on-year by 22.8% to 62,934 tonnes.
• Comprehensive energy consumption intensity decreased year-on-year by 5.1% to 994 MW·h/million yuan of operating revenue.
• Photovoltaic power generation of 160 thousand MW·h, reducing carbon dioxide emissions by 93 thousand tonnes.
• Alternative fuels consumption of 1.05 million tonnes, reducing carbon dioxide emissions by 233 thousand tonnes.
• Waste heat power generation of 6.56 million MW·h, reducing carbon dioxide emissions by 3,742 thousand tonnes.
• Comprehensive energy consumption of cement clinker per tonne decreased by 3.9%
• Recycled water utilization rate reached 92%
• Integrated utilization rate of non-hazardous solid waste reached 95%
• 160 national green factories and 43 national green mines.

Social Achievements

• Average training hours for all employees increased year-on-year by 4.3% to 49 hours.
• Total investment in philanthropy reached 70.57 million yuan.
• Volunteer activities of 30,078 hours.
• Employee satisfaction rate exceeded 96.5%
• Zero work-related fatalities.

Governance Achievements

• Joined the United Nations Global Compact (UNGC) in August 2023.
• Established an ESG management system with board responsibility, management organization, departmental cooperation, and subsidiary linkage.
• Obtained GB/T 35770-2022/ISO 37301:2021 Compliance Management System Certification issued by SGS.
• No corruption lawsuits filed and concluded against the Group’s companies and employees.

Climate Goals & Targets

Environmental Challenges

• Stricter policies and supervision on existing products and services.
• Higher operating costs due to increased carbon-related taxes.
• More stringent emission and disclosure requirements.
• Rising prices of raw materials and energy.
• Increasingly stringent market requirements for low-carbon and environmentally-friendly attributes of products.
• Potential reputational risks if classified as a heavy polluter.
• Potential safety hazards in the working environment due to increasingly hot and cold weather.
• Decline in the stability of energy supply.

Mitigation Strategies

• Investment in low-carbon technological innovation and purchasing renewable energy certificates.
• Improving the management of carbon assets.
• Increasing the use of renewable energy.
• Focusing on and making good use of green finance.
• Developing alternative material technologies.
• Adjusting and optimizing its energy structure.
• Improving the research and development system of green products.
• Establishing ESG Committee and ESG Working Group.
• Establishing specific communication channels with various stakeholders.
• Developing and implementing rectification plans.
• Continuously monitoring relevant climate change-related risks.
• Formulating physical climate risk response or adaptation plans.

Supply Chain Management

Responsible Procurement

• Policy Statement on Sustainable Supply Chain Management
• Code of Conduct for Suppliers
• ESG requirements incorporated into bidding documents
• Integrity commitment letters signed with all cooperating suppliers
• Regular assessment of suppliers' integrity performance
• Supplier grading management (green, blue, yellow, red, black)

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather (floods, typhoons)
• Increasingly hot and cold weather

Transition Risks

• Stricter policies and regulations
• Pricing of greenhouse gas emissions
• More stringent emission and disclosure requirements
• Rising prices of raw materials and energy
• Market requirements for low-carbon products

Opportunities

• Resource efficiency
• Use of low-emission or renewable energy sources
• Participation in carbon trading market
• Use of new technologies
• Development and extension of low-emission products and services
• Development of solutions to climate change adaptation risks
• Availability of new products or services through R&D and innovation
• Enhancing ability to conduct diversified business activities
• Adoption of supportive incentive policies
• Market demand and initiatives
• Participation in renewable energy projects
• Energy substitution/diversification

Reporting Standards

Frameworks Used: UN Sustainable Development Goals 2030 (SDGs), ESG Reporting Guide (Hong Kong Stock Exchange), Guidelines on Fulfilling Corporate Social Responsibilities of Central Enterprises, Guidelines to the State-owned Enterprises on Better Fulfilling Social Responsibilities, Reference Indicator System for the ESG Special Report of Listed Companies Controlled by Central Enterprises (SASAC), TCFD, SASB standards (Engineering & Construction Services sector)

Certifications: ISO 14001, ISO 45001, GB/T 35770-2022/ISO 37301:2021 Compliance Management System Certification

Third-party Assurance: Ernst & Young Hua Ming LLP

UN Sustainable Development Goals

• Goal 1: No Poverty
• Goal 2: Zero Hunger
• Goal 3: Good Health and Well-being
• Goal 4: Quality Education
• Goal 5: Gender Equality
• Goal 6: Clean Water and Sanitation
• Goal 7: Affordable and Clean Energy
• Goal 8: Decent Work and Economic Growth
• Goal 9: Industry, Innovation and Infrastructure
• Goal 11: Sustainable Cities and Communities
• Goal 13: Climate Action

The report details various initiatives contributing to these goals, including rural revitalization, employee well-being programs, green technology adoption, and community investment.

Sustainable Products & Innovation

• Low-carbon cement
• Special cement
• Special cementitious materials
• Gypsum board
• Waterproof materials
• Coating
• Glass fiber
• Wind turbine blades
• Lithium battery separators
• Hydrogen storage cylinders
• Carbon fiber
• Graphite

Awards & Recognition

• Leading Enterprise in China's industrial carbon emissions peak sector
• ESG Pioneer 100 among China's ESG Listed Companies
• ESG Pioneer 100 Index of Central Enterprises
• Best Progress Enterprise in the Industry (S&P Global Sustainability Yearbook)
• Excellent Issuer of Corporate Bonds (Shanghai Stock Exchange)
• Best Capital Market Communication and Best Emerging Company of the Year (7th China Excellence IR Awards)
• Best Management Team in Asia 2023 (Institutional Investor)