Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental Sustainability
• Social Responsibility
• Governance

Environmental Achievements

• Established an Environmental Sustainability Department to support the formulation and implementation of the Group’s carbon neutral and sustainable environmental development strategy.
• Received Wastewise Certificate (Excellence Level) by Hong Kong Green Organisation Certification for waste reduction efforts.

Social Achievements

• Implemented various employee welfare initiatives, including performance-based bonuses, paid vacation leave, and insurance.
• Launched an event called “Chow Sang Sang Ant Forest” to encourage low-carbon activities among employees, resulting in 98 real trees planted.

Governance Achievements

• Complied with the applicable code provisions of the Corporate Governance Code, except for a deviation from code provision A.2.1 (Chairman also serving as Group General Manager).
• Established an ESG Working Group to raise ESG awareness and drive group-wide contribution to environmental protection.

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impacting retail business and causing supply chain disruptions.
• Shrinking talent pool in Hong Kong due to emigration and pandemic restrictions.
• Geopolitical tensions and conflicts impacting gold prices and international supply chains.

Mitigation Strategies

• Robust e-commerce infrastructure serving Mainland and international markets.
• Prudent financial management and inventory control.
• Negotiating with landlords for rental relief to mitigate the impact of lost trading hours and lack of customer traffic.
• Ensuring adequate supply chain operation and funding to maintain business continuity.

Supply Chain Management

Supplier Audits: Annual random evaluations of new suppliers.

Responsible Procurement

• Background checks on suppliers.
• Consideration of infrastructure, production capacity, market reputation, legal, ethical, and social compliance.
• Preference given to suppliers working towards responsible and sustainable operations.

Climate-Related Risks & Opportunities

Physical Risks

• Strong wind or cyclone
• Flooding
• Landslide
• Temperature change

Reporting Standards

Frameworks Used: HKEx ESG Guide

Certifications: Wastewise Certificate (Excellence Level)

Third-party Assurance: Not disclosed

Awards & Recognition

• Excellent Service Retailer of the Year 2021
• Quality Service Retailer of the Year – Category Awards in Watch and Jewellery 2021
• Best Training Award (Silver Award) 2021
• Best Team Award (Silver Award) 2021
• Enterprise of the Year in the Dingge – Digital Transformation Awards 2021
• Best Practice of HR Digital Innovation in Greater China 2021
• Top Human Resources Management Award 2021

Environmental Metrics

ESG Focus Areas

• Occupational safety and health
• Service and product quality
• Employee development and training
• Anti-corruption
• Supply chain management
• Climate change management

Environmental Achievements

• Enriched Group Environmental Policy to explicitly outline climate change and resources management strategies.
• Set environmental targets for 2030 (reducing electricity consumption and greenhouse gas emissions intensity, water consumption and intensity by 7% at jewellery manufacturing factories, increasing e-receipt use to 70%).
• Developed a roadmap towards decarbonisation.
• One of the first corporate clients to open a sustainable account with a renowned bank in Hong Kong.

Social Achievements

• Implemented various onboarding and on-the-job training programs for employees.
• Established an ESG Working Group to raise awareness and drive group-wide contribution to environmental protection.
• Maintained an open and standardized framework for employment, salary review, and promotion.
• Provided benefits such as paid vacation leave and insurance.
• Implemented flexible working hours and work-from-home arrangements in response to COVID-19.
• Supported many charitable organizations through monetary and in-kind donations.

Governance Achievements

• Complied with the HKEx ESG Guide.
• Established a board independence evaluation mechanism.
• Adopted a board diversity policy.
• Implemented an anti-corruption policy and provided relevant trainings to employees.
• Maintained a customer data protection policy compliant with relevant laws and regulations.

Climate Goals & Targets

Environmental Challenges

• Pandemic impact on retail sales, particularly in Mainland China.
• Fall in Renminbi exchange rate.
• Swings in gold price.
• Labor shortage.
• Climbing interest rates.
• Fast-changing consumer tastes.
• Climate change.
• Geopolitical conflicts.
• Weakened consumer demand.

Mitigation Strategies

• Sales generated at new stores.
• Digitization and automation efforts.
• Multi-brand strategy and different decorating styles to enhance shopping experience.
• Development of live-streaming marketing and sales platforms.
• Use of advanced technology to optimize demand forecast, logistics, and customer relationship management.
• Leveraging design digitalization and production automation.
• Maintaining close partnership with suppliers and securing supplies from multi-sourcing.
• Business contingency plans for manufacturing and retail operations.
• Emergency response preparation against flood.

Supply Chain Management

Supplier Audits: Annual random assessments

Responsible Procurement

• Background checks on suppliers
• Preference given to suppliers with responsible and sustainable operations
• Compliance with legal, ethical, and social aspects
• Diamond suppliers provide documented proof of ethical provenance of raw materials.

Climate-Related Risks & Opportunities

Physical Risks

• Extreme wind or cyclone
• Flooding
• Water stress

Transition Risks

• Regulatory policies and legal risk from Mainland China’s emissions trading scheme
• Market risk from increasing environmental and social awareness of customers
• Sourcing of gold and platinum subject to transition risks due to investment diversion for climate risk mitigation and demand from low-carbon technologies.

Reporting Standards

Frameworks Used: HKEx ESG Guide

Certifications: Wastewi$e Certificate (Excellence Level)

Third-party Assurance: Not disclosed

Awards & Recognition

• 2022 Quality Service Retailer of the Year of Chain Stores – Silver Award
• 2022 Top 10 O2O Retail Brand
• Retail Excellence Award (Gold)
• Outstanding Flagship Service Brand
• Digital Transformation of the Year at Alibaba Cloud Summit Hong Kong 2022
• The Pioneer of Digital Intelligence Enterprise award at 2022 Global Business Innovation Conference
• 2022 Digital Innovation Leadership Award at the 11th China Finance Summit
• Best Retail Innovation Grand Award – Use of Technology (Hong Kong Retail Innovation Award 2022)
• Best Retail Innovation Grand Award – Market Potential & Performance (Hong Kong Retail Innovation Award 2022)
• 2022 Top Human Resources Management Award (51job)
• 2022 Shunde District “Advanced Enterprise Caring for Employees”

Environmental Metrics

ESG Focus Areas

• Occupational safety and health
• Service and product quality
• Employee development and training
• Anti-corruption
• Supply chain management

Environmental Achievements

• Expanded reporting boundary to encompass Hong Kong, Mainland China, Macau, and Taiwan.
• Obtained ISO 45001 certification.
• Zero work-related fatality in the last three years.
• Implemented multiple energy and water efficiency measures.
• Adopted green building design and materials in Xian flagship store.
• Reduced wastewater discharged compared to 2022.
• Hong Kong offices and laboratory received Wastewise Certificate (Excellence Level), factory received Wastewise Certificate (Good Level).

Social Achievements

• Awarded as a Caring Company.
• Awarded “2023 Green Sustainable Development Contribution Award”.
• Awarded “Excellent Environmental Protection Practice Enterprise Award – Excellent Award”.
• Awarded “Customer Service Power Brand Award” by HKIM.
• Received “Excellence in Personalisation Marketing – Gold” and “Excellence in Loyalty Marketing – Bronze” awards.
• Commended as a long-term participating retailer member of the “No Fakes Pledge” Scheme.
• Awarded “Most Valuable Brand Award in Greater Bay Area”.
• Chow Sang Sang Precious Metal Laboratory awarded Gold Award of the “Testing and Certification Manpower Development Award Scheme”.

Governance Achievements

• Complied with the applicable code provisions as set out in Part 2 of the Corporate Governance Code, except for deviations from code provisions B.2.4(b) and C.2.1.
• Appointed Mr. HSU Rockson as an INED on 1 June 2023.
• Adopted an amended and restated bye-laws of the Company.

Climate Goals & Targets

Environmental Challenges

• Post-pandemic rebound lacked momentum, especially in Mainland China.
• High store rentals in Hong Kong.
• Labor shortage.
• Downtrend in gem-set jewellery sales in Mainland China.
• Sluggish sales of high unit price gem-set jewellery.
• Disappointing diamond sales.
• Downward pressure on gross profit margin due to increasing proportion of gold in sales mix.
• Climate-related physical risks (extreme weather, flooding, water stress) and transition risks (regulatory changes, market shifts).

Mitigation Strategies

• Enhanced logistics, marketing, merchandising, and cost control.
• Selective expansion of store networks and markets.
• Business contingency plans for manufacturing and retail operations.
• Emergency response preparation against flood.
• Water and energy consumption reduction targets for factories.
• Procuring materials from recycled sources (recycled gold).
• Maintaining close partnership with suppliers and securing supplies from multi-sourcing.
• Urging suppliers to create their own carbon reduction roadmaps.
• Committed to establishing emissions reduction targets through the Science Based Targets initiative (SBTi).

Supply Chain Management

Supplier Audits: Annual random assessments

Responsible Procurement

• Background checks on suppliers; prioritising suppliers with responsible and sustainable operations; evaluating commitment to legal, ethical, and social compliance; requiring diamond suppliers to provide documented proof of ethical provenance.

Climate-Related Risks & Opportunities

Physical Risks

• Extreme wind or cyclone, flooding, water stress

Transition Risks

• Emissions trading scheme, green energy certificate programme, market shifts due to increased environmental and social awareness.

Reporting Standards

Frameworks Used: HKEx ESG Guide

Certifications: ISO 45001

Awards & Recognition

• Caring Company
• 2023 Green Sustainable Development Contribution Award
• Excellent Environmental Protection Practice Enterprise Award – Excellent Award
• Customer Service Power Brand Award
• Excellence in Personalisation Marketing – Gold
• Excellence in Loyalty Marketing – Bronze
• Most Valuable Brand Award in Greater Bay Area
• Gold Award of the “Testing and Certification Manpower Development Award Scheme”