Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental protection
• Social welfare
• Corporate governance

Environmental Achievements

• Reduced energy consumption by 192,288,200 kWh
• Increased polysilicon material recovery rate from 50% to 100%
• No environmental non-compliance incidents reported

Social Achievements

• Organized 26 public welfare and volunteer activities
• Invested RMB964,400 in charity
• No significant safety incidents reported, including work-related fatalities
• No occupational disease or suspected occupational diseases reported
• Employee satisfaction rate of 87%

Governance Achievements

• Included as a constituent stock of Hang Seng Corporate Sustainability Benchmark Index (HSSUSB) for the first time
• Established codes of conduct to provide employees with clear guidance on moral behavior
• Launched 35 trainings about law and regulation compliance, covering all employees
• No lawsuit case involving bribery and embezzlement, or lawsuit case related to unfair competition and monopoly

Climate Goals & Targets

Environmental Challenges

• Not disclosed

Mitigation Strategies

• Not disclosed

Supply Chain Management

Supplier Audits: 1701 suppliers; 782 with annual purchase volume over RMB200,000; most suppliers passed QMS, EMS, and OHSMS certifications

Responsible Procurement

• Supplier access management, contractual management and development management through the supplier membership system; sunshine purchase; supplier portal system for dynamic management of supply chains

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: GRI Standards: Core option, SEHK ESG Reporting Guide, CASS CSR Indicator Index

Certifications: ISO 14001

Third-party Assurance: Chinese Expert Committee on CSR Report Rating (4.5 stars)

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• G3 monocrystalline ingot wafers
• TS series black silicon wafers

Awards & Recognition

• Hang Seng Corporate Sustainability Benchmark Index constituent
• Numerous awards listed in Honors and Awards section

Environmental Metrics

ESG Focus Areas

• Environmental protection
• Social responsibility
• Corporate governance

Environmental Achievements

• Reduced carbon dioxide emissions by an estimated 807.36 million tonnes through silicon wafer production (equivalent to 295.30 million tonnes of standard coal)
• Reduced water consumption at Funing GCL Photovoltaic from 6.9 tonnes/10,000 units to 5.3 tonnes/10,000 units
• Achieved zero discharge of materials as waste through materials recycling

Social Achievements

• Launched various staff activities to foster interaction among staff and enhance team solidarity
• Provided comprehensive assurances for staff occupational health by improving working conditions, providing labour protection supplies and offering basic medical protection
• Conducted various community welfare initiatives, reaching out to underprivileged groups and offering enthusiastic support for local education

Governance Achievements

• Established a three-level risk management system
• Formulated the GCL-Poly Management Standards for Anti-Fraud and Whistleblowing
• Conducted corporate governance and risk-related courses for intermediary and senior management personnel

Climate Goals & Targets

Environmental Challenges

• Decline in revenue in solar material business as a result of the downward average selling price for wafer and polysilicon products
• High gearing ratio
• Grid curtailment risk

Mitigation Strategies

• Strategic transformation of its products, focusing on the adjustment and optimization of the industry structure
• Asset consolidation, treasury operation and equity optimisation
• Focusing on developing solar power projects in regions with well-developed inter-province power transmission network or with strong domestic power demand

Supply Chain Management

Supplier Audits: 1,007 suppliers audited

Responsible Procurement

• Rigorous and standardised process for the admission of suppliers
• Multi-tier comprehensive assessment mechanism
• Incorporation of green procurement concepts

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: Appendix 27 in the Listing Rules “Environmental, Social, and Governance Reporting Guide (December 2015)”

Sustainable Products & Innovation

• Ingot monosilicon
• Granular silicon

Awards & Recognition

• 2018 Outstanding Management Unit of Special Equipment
• Most Valuable Energy and Resources Company
• List of Innovative Energy Enterprises of China 2018 — New Energy Production
• Contribution Award in Asian Photovoltaic Industry
• Terawatt Diamond Award
• Annual Affordable Internet Technology Contribution Award
• Jiangsu Province Exemplary Intelligent Manufacturing Workshop
• Jiangsu Province Water Conservation Enterprise
• National-level green factory

Environmental Metrics

ESG Focus Areas

• Environmental protection
• Social responsibility
• Governance

Environmental Achievements

• Reduced carbon emission by 44.67 million tonnes/year (compared with thermal power based on a 25-year component lifecycle)
• Granular silicon products obtained the “Carbon Footprint Certificate” from international authoritative institutes

Social Achievements

• Provided equal and diversified employment opportunities to 8,863 employees
• Provided an average of 102.12 training hours per employee with 100% employee participation
• Organized 897 safety production emergency drills with 22,204 participants, recording zero cases of employee occupational disease

Governance Achievements

• Enhanced the composition of the Board
• Improved corporate risk control and compliance systems
• Initiated a pilot run of sustainable development performance assessment

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to the growth of demand from the downstream photovoltaic industry and government control of energy consumption and intensity
• Climate-related risks including drought, typhoon, extremely hot/cold weather, and floods

Mitigation Strategies

• Strategic plans for developing high-purity nano-silicon powder production capacity
• Formulated strategic plans for developing high-purity nano-silicon powder production capacity to improve the safety margin of silicon material production
• Implemented various energy-saving and consumption-reduction projects and enhanced energy efficiency by transforming technologies and upgrading traditional equipment
• Established an environmental emergency response plan system to handle emergency environment incidents

Supply Chain Management

Responsible Procurement

• Prioritizing cooperation with state-owned enterprises, listed companies, and industry-leading companies
• Prioritizing cooperation with manufacturers over trading enterprises
• Prioritizing cooperation with general agents and other large-scale agents
• Incorporating key ESG elements into specific management measures and cooperation requirements of suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Drought
• Typhoon
• Extremely hot weather
• Extremely cold weather
• Flood
• Extreme weather variability and changes in rainfall pattern

Transition Risks

• Technological risks (upfront costs for technological transformation, failure of investment in new technologies)
• Market risks (increase in raw material costs)
• Reputational risks (changes in customer preferences, increasing concern of stakeholders for negative feedback)

Opportunities

• Development of energy-efficient products (granular silicon)

Reporting Standards

Frameworks Used: SEHK “ESG Reporting Guide”, United Nations Sustainable Development Goals (SDGs), MSCI, Hang Seng Corporate Sustainability Index

Certifications: ISO 14001, ISO 9001, ISO 50001, ISO 45001

Sustainable Products & Innovation

• Granular silicon

Awards & Recognition

• Terawatt Diamond Award
• National Youth Civilization
• Worker Pioneer
• Jiangsu Industrial Internet Development Demonstration Enterprise — Benchmark Factory
• Hong Kong Awards for Environmental Excellence
• Most Influential PV Materials Manufacturer
• Hong Kong Green Organisation Certification
• Most influential raw material enterprise
• Listed Company Outstanding Industrial Contribution Award
• Golden Hong Kong Stocks Award in 2021
• Best IR Team in Golden Hong Kong Stocks Award

Environmental Metrics

ESG Focus Areas

• Climate Change
• Green Operations
• Technological Innovation
• Talent Cultivation
• Social Responsibility
• Corporate Governance
• Supply Chain Management

Environmental Achievements

• Greenhouse gas emissions intensity decreased by 41% compared with 2021
• Comprehensive energy consumption intensity decreased by 45% compared with 2021
• Total water consumption intensity decreased by 56% compared with 2021
• Energy consumption and carbon emissions during production reduced by about 80% in Wuhai
• Polysilicon produced for PV power stations expected to achieve an annual carbon emissions reduction of 79.29 million tonnes
• Carbon footprint of module decreased by 28%
• World's lowest carbon footprint for granular silicon (37 kg CO2 equivalent/kg)

Social Achievements

• Total training hours of employees reached 118,277.2 hours, a year-on-year increase of 62%
• Coverage of business ethics training 100%
• Accumulative contribution in public welfare exceeded RMB 13.207 million
• Employee turnover rate stood at 18.5%
• Average satisfaction of key customers reached 91%

Governance Achievements

• Established the Environmental, Social and Governance Committee (ESG Committee)
• Established a three-tier ESG governance structure
• Revised the Anti-Fraud (including Anti-Corruption) and Whistleblowing Management Standards
• 100% training coverage on business ethics for all employees and interns
• Zero environmental pollution incidents or environmental related penalties
• Nine subsidiaries passed ISO 14001 environmental management system certification (69% certification rate)
• Nine subsidiaries obtained ISO 45001 occupational health and safety management certification (75% certification rate)

Climate Goals & Targets

Environmental Challenges

• Reputational risks due to industrial stigmatization related to climate change
• Climate change risks (excessive rainfall, flooding, typhoons, extreme heat)
• Stakeholder concerns regarding ESG performance and climate change actions
• Supply chain risks

Mitigation Strategies

• Promoting green and low-carbon concepts in procurement
• Applying green concepts throughout the manufacturing process
• Adopting FBR method for granular silicon production
• Regular monitoring and analysis of climate-related risks
• Implementing measures to safeguard operations and minimize impact of extreme weather
• Establishing ESG Committee and three-tier governance structure
• Establishing a comprehensive supply chain assurance system and implementing diversified procurement measures

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• ESG factors integrated into supplier evaluation and cooperation
• Preference for suppliers with ISO9001, ISO14001, ISO45001 certifications
• Disqualifying suppliers with falsified data or violations
• Requiring compliance with labor laws and regulations
• Promoting green and low-carbon concepts
• Support for local suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Excessive rainfall
• Flooding
• Typhoons
• Extremely hot weather

Transition Risks

• Increasing stakeholder expectations for low-carbon requirements
• Reputational risks

Opportunities

• Promoting low-cost and low-carbon FBR-based granular silicon technology
• Expanding business based on energy technology innovation and low-carbon emissions reduction goals
• Improving resource usage efficiency
• Using clean energy in production

Reporting Standards

Frameworks Used: UN Sustainable Development Goals (SDGs), HKEX ESG Reporting Guide

Certifications: ISO 14001, ISO 45001, ISO 9001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

To better realize our blueprint for sustainable development and address sustainable development challenges on all fronts, we have identified 13 Sustainable Development Goals (SDGs) that are closely related to the Group.

Sustainable Products & Innovation

• FBR-based granular silicon

Awards & Recognition

• Forbes' Global Top 2000 Listed Companies
• Fortune China Top 500 List
• Constituent stock of the MSCI China Index
• Constituent stock of the Hang Seng Composite Index
• China Leaders 100 Index
• Constituent stock of the Hang Seng Climate Change 1.5℃ Target Index
• 2022 Fortune China ESG Annual Innovation Award
• United Nations Sustainable Development Goals Achievement Experiment List by Wall Street News
• Environmental Awards, Hong Kong (UNSDGAA HK)

Environmental Metrics

ESG Focus Areas

• Environmental Management
• Social Responsibility
• Governance and Compliance

Environmental Achievements

• Reduced carbon emissions by approximately 5 million tCO2e compared to using the Siemens method for granular silicon production.
• Achieved 100% ISO 14001 environmental management systems certification across 13 out of 15 subsidiaries.
• Reduced wastewater discharge by more than 503,000 tonnes at Jiangsu Zhongneng.
• Reduced dust emissions by 1.95% year-on-year at Jiangsu Zhongneng.

Social Achievements

• Increased customer satisfaction rate to 96.85%.
• Launched the "Starlight: Global Trainee" program.
• Published the Statutes of Union at GCL Technology.
• Invested around RMB 2.4 million in social welfare and community investments.

Governance Achievements

• Established the Sustainability Management Committee and the Sustainable Development Center.
• Formulated the Board Diversity Policy.
• Released the GCL Technology Supplier Corporate Social Responsibility Code of Conduct.
• Conducted an information security attack and defense exercise with 100% employee coverage.

Climate Goals & Targets

Environmental Challenges

• High carbon emissions inherent in PV production processes.
• Supply chain constraints due to insufficient polysilicon supply.
• Tightening carbon policies and increased disclosure requirements.
• Rising fossil fuel prices.

Mitigation Strategies

• Invested over RMB 20 billion since 2011 to promote product innovation, particularly granular silicon.
• Implemented energy-saving technological transformation measures.
• Reduced carbon emissions through various initiatives.
• Capitalized on energy-saving equipment, increased renewable energy use, and opted for clean fuel for transportation.

Supply Chain Management

Supplier Audits: 1,067

Responsible Procurement

• GCL Technology Supplier Corporate Social Responsibility Code of Conduct
• Prioritizing suppliers with environmental and social certifications.

Climate-Related Risks & Opportunities

Physical Risks

• Acute meteorological disasters
• Heat waves
• Cold waves
• Water scarcity

Transition Risks

• Tightening carbon policies
• Costs to transition to low-carbon equipment
• Changing market demand
• Rising fossil fuel prices

Opportunities

• Growth opportunities in emerging economies
• Elevated resource efficiency
• Transition to renewable energy

Reporting Standards

Frameworks Used: HKEX ESG Reporting Guide, GRI Standards

Certifications: ISO 9001, ISO 14001, ISO 45001

Third-party Assurance: SGS -CSTC

UN Sustainable Development Goals

• Goal 7 (Affordable and Clean Energy)
• Goal 9 (Industry, Innovation, and Infrastructure)
• Goal 12 (Responsible Consumption and Production)
• Goal 13 (Climate Action)

Initiatives contribute to these goals through low-carbon production, renewable energy use, waste reduction, and climate change mitigation.

Sustainable Products & Innovation

• Granular silicon

Awards & Recognition

• 2023 Technology Product Innovator Award
• 2023 Beautiful China Dual Carbon Pioneer Award
• Hong Kong Green Organization Wastewise Certificate
• 7th China IR Annual Awards – Best ESG Award