Climate Change Data

Environmental Metrics

ESG Focus Areas

• Corporate Governance
• Product Quality
• Supply Chain Management
• Employee Wellbeing
• Environmental Protection
• Community Investment
• Innovation

Environmental Achievements

• Reduced wastewater emission intensity from 150.11 tons/million-yuan revenue in 2022 to 102.29 tons/million-yuan revenue in 2023
• Reduced greenhouse gas emission intensity from 9.19 tCO2e/million-yuan revenue in 2022 to 6.24 tCO2e/million-yuan revenue in 2023
• Installed high-efficiency filters and activated carbon adsorption devices to reduce exhaust gas emissions
• Optimized sterilization process to reduce emissions
• Recycled cooling water to reduce water consumption
• Optimized packaging design and recycled packaging materials

Social Achievements

• Established Zylox-Tonbridge Public Charity Fund, raising nearly RMB1.3 million
• Assisted Turkish hospitals in post-earthquake recovery
• Organized various employee wellbeing initiatives, including annual physical examinations, rental subsidies, and team-building activities
• Provided 10.82 average training hours per employee
• Maintained a low employee turnover rate of 21.5%
• Launched compliance training programs for employees and distributors

Governance Achievements

• Established a three-tier ESG governance structure (Board of Directors, Senior Management, and ESG Working Group)
• Implemented a comprehensive compliance system, including anti-corruption, anti-fraud, and anti-money laundering policies
• Established a whistle-blowing policy
• Complied with all relevant laws and regulations

Climate Goals & Targets

Environmental Challenges

• Reliance on a limited number of commercialized products
• Substantial competition and pricing pressure in the medical device markets
• Limited experience in marketing and sales
• Complex manufacturing processes subject to strict quality controls
• Highly regulated industry
• Potential for supply chain disruptions due to extreme weather events
• Changes in regulations in China

Mitigation Strategies

• Developing a more comprehensive product line
• Improving operating efficiency through refined internal processes and IT investments
• Expanding overseas capabilities and sales revenue
• Strengthening relationships with hospitals and physicians
• Investing in innovation and R&D
• Developing alternative sourcing strategies
• Implementing robust risk management policies and procedures

Supply Chain Management

Supplier Audits: 259 suppliers audited, all qualified

Responsible Procurement

• Comprehensive assessment of new suppliers
• Regular audits of existing suppliers
• Supplier Code of Conduct
• Requirement for suppliers to sign Anti-Competitive Commitment and Integrity Commitment

Climate-Related Risks & Opportunities

Physical Risks

• Disruption to daily operations and supply chain due to extreme weather events
• Increased risk of infectious diseases

Transition Risks

• Failure to comply with laws and regulations
• Failure to develop sustainable products
• Changes in market conditions
• Reputational damage

Opportunities

• Development of energy-efficient products
• Promotion of clean energy initiatives

Reporting Standards

Frameworks Used: Appendix C2 Environmental, Social and Governance Reporting Guide to the Main Board Listing Rules of Hong Kong Exchanges and Clearing Limited

Certifications: ISO 13485 Medical Device Quality Management System Certification, ISO 9001 Quality Management System Certification (Zhuhai), CNAS Accreditation on Laboratory (Zhuhai), Enterprise Intellectual Property Management (GB/T29490–2013) certification

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• MSCI ESG AA rating
• Inclusion in MSCI China All Shares Small Cap Index
• Inclusion in FTSE Global Total-Cap Index and FTSE Global Micro Cap Index
• Selection into the “Jianbing Plan” & “Lingyan Plan” in Zhejiang