Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental Protection
• Employee Well-being
• Quality Management
• Supply Chain Management
• Anti-corruption
• Community Engagement

Environmental Achievements

• No major environmental pollution incidents reported in 2019.
• Reduced per capita water, gasoline, and greenhouse gas emissions compared to 2018.
• Implemented environmental protection measures in new laboratories.

Social Achievements

• Increased workforce by 37% compared to 2018.
• No work-related injuries or deaths reported in 2019.
• Provided annual physical examinations and insurance to employees.
• Offered 3895 hours of employee training (average 25.29 hours per employee).
• Established a labor union to enhance employee well-being and engagement.

Governance Achievements

• Established a Quality Decision-making and Management Department.
• Updated the “Quality Manual” based on the latest PRC Drug Management Law.
• Implemented a quality risk management (QRM) process.
• Established a Corrective and Preventive Measures Process System (CAPA).
• No major corruption cases reported in 2019.
• Implemented a whistleblower policy and procedures.

Climate Goals & Targets

Environmental Challenges

• Minimizing environmental impact from increasing operations.
• Maintaining high quality standards in a rapidly growing company.
• Ensuring ethical and compliant practices throughout the supply chain.

Mitigation Strategies

• Implementing green initiatives and low-carbon workstyles.
• Establishing robust quality management systems and processes.
• Conducting supplier audits and implementing strict quality agreements.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Strict requirements on quality and environmental awareness of suppliers.
• Dual review of qualification and on-site audits of potential suppliers.

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: HKEX ESG Guide

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Innovation Award from Zhangjiang Science City

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• No major environment pollution incident was reported, and no complaint was received resulting from environment pollution or non-compliance with environmental laws and regulations.
• Consumption per capita of electricity, gasoline, and greenhouse gas all decreased compared to the previous reporting period.

Social Achievements

• Obtained the Drug Manufacturing Permit for dorzagliatin.
• Organized 26 training sessions with a total of 2,454 training hours.
• No work-related injuries or deaths.

Governance Achievements

• Updated the Whistleblower Policy to improve the whistleblowing system.
• Updated more than 20 quality assurance Standard Operating Procedures (SOPs).
• Completed 9 GMP vendor audits and signed 8 quality agreements and completed 7 GCP/GLP vendor audits and signed 4 quality agreements.

Climate Goals & Targets

Environmental Challenges

• Sudden outbreak of Covid-19 brought great changes to people’s lives and posed challenges to the Group.
• The organization of offline trainings encountered some challenges due to the impact of the epidemic.

Mitigation Strategies

• Actively responding and promptly implementing strategic decisions related to the prevention and control of the epidemic.
• Actively adopted online training in addition to offline training.

Supply Chain Management

Supplier Audits: 9 GMP vendor audits, 7 GCP/GLP vendor audits

Responsible Procurement

• Vendor Qualification and Monitor Process
• Quality Assurance Agreement (QAA)

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: ESG Guide in Appendix 27 to the Main Board Listing Rules published by the Hong Kong Stock Exchange and Clearing Limited

Awards & Recognition

• high-growth headquarters in Pudong New Area
• Certificate of Multinational R&D Center
• 2020 Gelonghui Most Innovative Award

Environmental Metrics

ESG Focus Areas

• Greenhouse gas emission management
• Efficient utilization of resources
• Waste disposal
• Product Safety and Quality Management
• Drug Accessibility
• Business Ethics
• Supply Chain Management
• Employee Health & Safety
• Employee Development & Training
• Intellectual Property Management

Environmental Achievements

• Eliminated major environmental pollution accident or complaint
• 100% Emission detection compliance rate
• Actively respond to the national dual carbon targets and achieve a carbon neutral pace no later than the peer average
• 100% of the waste is entrusted to qualified institutions
• 100% Hazardous waste detection compliance rate

Social Achievements

• Launched HuaTangNing (dorzagliatin), a first-in-class glucokinase allosteric activator (GKA) for diabetes, achieving full commercialization for the second year.
• Successfully included HuaTangNing in China’s National Reimbursement Drug List (NRDL), making it more affordable for patients.
• Developed a framework of 10 core elements centered on key processes affecting the quality of pharmaceuticals.
• Built an all-round talent training system for employees, featuring a scientific and reasonable promotion and incentive mechanism.
• Supported the China Diabetes Care Project.

Governance Achievements

• Established a comprehensive corporate governance structure with a diversified Board of Directors overseeing ESG matters.
• Developed and continuously updated internal policies and procedures, including a Fraud Policy Statement, Whistleblower Policy, Anti-Bribery and Anti-Corruption Procedures, and Hua Medicine Code of Conduct.
• Organized two thematic compliance training sessions for all employees.
• Conducted four internal audits, including thorough testing and assessment of anti-bribery and anti-corruption controls.

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to urban construction and renovation impacting a supplier's operations.
• Potential supply disruptions and price increases for overseas suppliers due to energy supply and labor issues.

Mitigation Strategies

• Developed contingency measures, including advance order management, inventory locking, and adjusting inbound and outbound schedules.
• Early contract negotiations and strategic cooperation with overseas suppliers, locking in prices and reserving safety stocks.

Supply Chain Management

Supplier Audits: 28 audits / 5 on-site inspections

Responsible Procurement

• Stringent supplier entry management system
• Supplier Information Questionnaire
• Collection of compliance certificates
• Third-party sample certification
• Supplier change risk assessment
• Confidentiality agreements
• Quality Assurance Agreements

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events

Transition Risks

• Regulatory changes, market shifts

Reporting Standards

Frameworks Used: SASB, MSCI

Awards & Recognition

• Top 10 Most Influential Small Molecule Innovative Pharmaceutical Companies
• China Innovative Pharmaceutical Company in 2022
• 3rd Awards for Medicine Innovation