恒逸石化:Hengyi Social Responsibility Report 2022

Hengyi Petrochemical Co.Ltd.2022 Social Responsibility ReportAbout this report
This report aims to respond to the expectations and concerns of stakeholders regarding the
Purpose sustainable development concept and policies of Hengyi Petrochemical Co. Ltd. and its
efforts in environmental protection social responsibility and corporate governance in 2022.Orgnizational The report covers Hengyi Petrochemical Co.Ltd. and its branches subsidiaries and affiliates.Coverage
Reporting This report covers the period from 1 January 2022 to 31 December 2022. Some contents
世 Period and data are from previous years.受 社 会 尊 敬 的 界级 Publication This is the forth social responsibility report issued by the company. 绿色石化企业
WORLDCLASS RESPECTED BY SOCIETY
GREEN PETROCHEMICAL ENTERPRISES This report has been prepared in accordance with the requirements of Chapter 8 "Social
Responsibility" of the "Regulations of Shenzhen Stock Exchange for Self-Discipline of
Listed Companies on the Main Board" and with reference to the "Global Reporting Initiative
References
(GRI) Standards" as well as the "Guidelines for Social Responsibility Reporting
Compilation" (GB/T 36000-2015) and the "Guidelines for Chinese Enterprise Social
Responsibility Reporting Compilation (CASS-CSR4.0)" issued by the Chinese Academy of
Social Sciences.For ease of presentation and readability Hengyi Petrochemical Co.Ltd. is also referred to
Abbreviations
as "Hengyi" the "Company" and "We" in this report.The information and data cited in this report come from official company documents
statistical and financial reports provided by Hengyi employees and partners. It's only for
Data Sources disclosing Hengyi's sustainable development progress not for commercial use. The
financial data in this report is subject to the annual report data. Other data is from internal
statistics. The currency used in this report is RMB unless otherwise noted.This report has been reviewed and approved by the board of directors of the company on
Language
April 19 2023.This report is available in simplified Chinese and English. In case of
Versions
inconsistency please refer to the simplified Chinese version as it shall prevail.Request Website：www.hengyishihua.com / CNInfo：www.cninfo.com.cn
01
Social Responsibility H E N G Y I05 06 08 10 22
Content Chairman’s About Hengyi ESG Highlights Governance Common Prosperity-
Statement Responsibility
Governance
Business Ethics Employee Well-being
Compliance Rural Revitalization
Investor Relationship Charity
Stakeholder Communication
Materiality Analysis
38465262
Green Production- Ecosystem- Innovation- Appendix
Carbon Net-zero Accountability Sustainability
Climate Change Responsible Procurement Green Innovation
Water Resource Management Safety Management Circular economy
Pollutant Management Product Quality&Service Digitalization
Clean EnergyChairman’s Statment
In 2022 which was an extraordinary and challenging year Hengyi upheld its strategic resolve and adjusted its
business strategies to effectively combine its operations and sustainable development. Under the relentless efforts
of all employees Hengyi overcame the downward pressure in the industry and gained valuable entry into the next
round of competition.In the past year Hengyi actively implemented its sustainable development philosophy and strengthened
environmental protection committed to energy conservation and emissions reduction. During production Hengyi
adhered to a bottom-line mentality and focused on its core business resulting in a continuously improving
production safety situation and significantly improved risk resistance capability. Hengyi's Brunei Refining and
Chemical project won the national-level "Luban Award" engineering prize and was praised as a model for building a
Asia-Pacific community of shared destiny by People's Daily. In product R&D Hengyi persistently drove innovation
and increased R&D investment and was the first in the industry to break through the bottleneck of environmental-
friendly phthalate-free polyester industrialization opening a new era of green development. Through technological
innovation and management transformation Hengyi continuously advanced the company's green low-carbon and
environmental protection processes comprehensively enhancing its sustainable development level.Facing the complex and changing international situation and macro environment Hengyi adheres to a strategic
outlook enhances its sense of urgency and mission and always maintains a humble and grateful heart. With the
goal of "reducing costs increasing efficiency and improving quality" Hengyi works hard and improves its operations
and management efficiency in order to achieve Hengyi's long-term development goals.In 2023 Hengyi will continue to be guided by the spirit of the CPC's 20th National Congress enhance its sense of
urgency responsibility and mission and continuously improve its own quality. With a high sense of social
responsibility and mission Hengyi will make persistent efforts to achieve the grand vision of "Green Hengyi Building
a Harmonious society."In the future Hengyi will adhere to the development strategy continuously improve green
management continuously promote green production actively promote resource conservation and continuously
explore the circular economy. Hengyi will also strengthen its R&D efforts on recyclable and biodegradable products
and jointly build a green ecological circle of circular development with upstream and downstream industries in the
industrial chain. At the same time Hengyi will also continue to fulfill its corporate social responsibility committed to
community development employee welfare public welfare and charity projects contributing to the realization of the
goal of common prosperity and rural revitalization.I believe that with the joint efforts of all Hengyi employees the future Hengyi will usher in a better tomorrow.
0405
Social Responsibility H E N G Y IAbout Hengyi
Since its inception the company has focused on the strategic policy of
Hengyi is committed to becoming a leading and first-class "strengthening and enhancing its core business competitiveness." In
petrochemical company in China and the world collaboration with strategic partners it continuously expands upstream
continuously improving its competitiveness through in the petrochemical industry chain. The company will advance by
resource sharing and industry collaboration. The company leveraging the Brunei PMB Petrochemical Project a joint venture with
expands its industrial supporting functions and enriches its the Brunei government. It is a key "Belt and Road" initiative holding
petrochemical products through multi-level three- strategic significance and marking a crucial step toward international
dimensional industrial layout and integration of production capacity cooperation and integrated industrial chain goals. The project
and finance strategies. Its main products include purified will exemplify China-Brunei friendly cooperation.terephthalic acid (PTA) caprolactam (CPL) polyethylene
terephthalate (PET) chips bottles pre-oriented yarn (POY) The revenue amounted in 2022: 152.05 billion
draw-textured yarn (DTY) and short fibers. Polyester
products are widely used and closely related to national
and people's livelihood needs mainly for textile clothing
home textiles and industrial applications. Hengyi has
successfully launched differentiated products such as
"YiTaiKang" environmental-friendly polyester chips and Hengyi Culture
fibers cationic polyester chips and fibers ultra-high elastic
fibers imitated rabbit hair fibers special shape fibers
colored fibers mother fibers bamboo fibers dragon fibers
and colored fibers leading the field in differentiation and Hengyi has developed a unique "54354" corporate culture mechanism
high-value-added products over 40 years focusing on five sub-cultures: shared creation
dedication to excellence pioneering stability and security and mutual
cooperation. It adheres to four principles aiming for harmony between
Through resource sharing and industrial synergy the culture and strategy growth and employee development and cultural
company enhances its overall competitiveness creating a advantage and competitiveness. By building five driving systems
dual "polyester + nylon" driving mode and forming a multi- Hengyi aspires to be a century-old enterprise deeply respected
level and three-dimensional industrial layout with the welcomed trusted and loved by society customers shareholders and
petrochemical industry chain as the core business supply employees. Core values include pragmatism responsibility
chain service business as the growth business and surpassing and sharing.differentiated fiber products industrial intelligent
technology applications as emerging businesses.Philosophy Persistence rewards diligence noble aspirations reach far
Build a century-old evergreen foundation and stand among
Mission the world's renowned enterprises
Become one of the world's top-tier petrochemical industry
Vision groups
Spirit Never stop moving forward create brilliance
0607
Social Responsibility H E N G Y I03
01 Green Production-Carbon Net-zero
Governance Solar power generation of 44.2 million kWh
Emission index compliance rate 100%
6 shareholder meetings
Water saving of 423 million tonnes
0 major fraudulent event
Environmental protection cost of RMB 80.10
25 management and special audits million
ESG HIGHLIGHTS
04
Awards and Honors
Ecosystem-Accountability
Hengyi was awarded the “2022 ESG Gold Medal” 1661suppliers02
The "2022 China Manufacturing Listed Companies Social Responsibility Five Star Gold Award List" is an annual 919 safety training sessions
social responsibility and ESG award published by the Times Responsibility 40 Forum think tank as an independent
third-party evaluation. Winning this award recognizes Hengyi's commitment as a model of shared prosperity Common Prosperity-Responsibility
development. 0 major casualties
100% safety training pass rate
15637 employees
Safety cost of RMB 31.13 million
Female employees ratio of 26.37%
98 hours of training time per person
100% of physical examination coverage 05
Issued skill certification to 1500 people Innovation-Sustainability
Primary school donation of RMB 27million
1065 R&D personnel
R&D investment of RMB 690 million
23 projects under research
08097
Social Responsibility H E N G Y IGovernance
Hengyi upholds fairness transparency and compliance aiming to
establish a robust corporate governance system. The company
emphasizes optimized management reinforced internal controls and risk
management to ensure steady growth and protect investors' interests.Governance
Business Ethics
Compliance
Investor Relationship
Stakeholder Communication
Corporate Governance
Materiality Analysis
Hengyi is dedicated to high-level corporate governance focusing on diligent boards and robust internal supervision.Complaining with the 'Company Law' 'Securities Law' 'Corporate Governance Guidelines for Listed Companies'
SDGs we focused
'Shenzhen Stock Exchange Listing Rules' 'Shenzhen Stock Exchange Main Board Listing Companies Self-
in this section：
regulatory Guidelines No. 1 – Main Board Listed Companies' Standard Operation' and other relevant laws and
regulations. the company refines its governance standards based on its situation enhancing the performance of
the 'shareholders meeting board of directors board of supervisors and senior management' and promoting the
modernization of governance systems and capabilities.
11
Social Responsibility Governance H E N G Y IGovernance Framework
Board of Directors
Hengyi
Petrochemical
Co.Ltd The Hengyi Board of Directors has 9 directors including 6 non-independent and 3 independent directors. The
Board formulates company strategy and policies sets performance and management goals evaluates business
performance and oversees management.In 2022 the Board held 10 meetings.Strategy&Investment Committee
Shareholders Meeting
Board of Supervisors
Compensation Committee
Board of Directors
Risk Control Committee
BoD Office
Audit Committee Senior Management
Professional Committee
The Board has four committees: Strategy & Investment Compensation Risk Control and Audit. These committees
are accountable to the Board have clear responsibilities and powers and provide advice and recommendations.Each committee operates within its own field to ensure the company's smooth operation.Board of Supervisors
Shareholders Meeting
As of the reporting period end the company's Board of Supervisors consisted of 3 members 2 of whom are female.The Board oversees the company's major matters finances and the legality of the directors and senior
management. It protects shareholder rights and company interests and improves the company's standard
Hengyi's shareholders meeting operating level.strictly follow "Company Law of the
People's Republic of China" In 2022 the Board held 8 meetings。
"Securities Law of the PRC" "Rules
for Shareholders' Meetings of Listed
Companies" "Company Articles of
Assoc ia t ion" "Shareho lders '
Meeting Rules" and other relevant
laws regulations and rules. All Senior Management
shareholders are treated fairly.As of the reporting period end the company's management consisted of 8 senior personnel. The management
team consists of experts in petrochemical materials science finance law marketing etc. and has professional
In 2022 judgment and rich management experience allowing the company to quickly identify market opportunities and
the company held 6 shareholder potential risks and maintain its industry advantage.meetings
1213
Social Responsibility Governance H E N G Y I
Safety&Environment
Capital Management
Finance
Office
Information&Data
Human Resource
Investment
Production Management
Audit&LegalBusiness Ethics Compliance
The company strictly adheres to laws and regulations such as the "Civil Code of the PRC" "Criminal Law of the
PRC" "Supervision Law of the PRC" "Company Law of the PRC" "Anti-Monopoly Law of the PRC" "Anti-Money
Laundering Law of the PRC" "Anti-Unfair Competition Law of the PRC" "Labor Contract Law of the PRC" and Hengyi consistently adheres to the principle of "legally and compliantly pursuing high-quality" sticks to
"Environmental Protection Law of the PRC". transparent and compliant operation guidelines and establishes a comprehensive compliance
management system that meets the needs of the company's business development and the best
With a "zero-tolerance" attitude towards fraud and corruption it has established an anti-fraud working group led by practices in the petrochemical industry. In 2022 the company further integrated and optimized its
the chairman. The company's audit and legal departments oversee internal audits supervision and disciplinary internal control risk and compliance management systems realizing a full alignment of the internal
action continuously improving integrity-related systems and regulations. This strengthens long-term warning control system and standards and improving the company's risk management ability immunity and
mechanisms against fraud and bribery safeguarding the rights and interests of the company and its shareholders. resilience providing a solid guarantee for the realization of the company's development strategy and
sustainable development.Code of Business Anti-Fraud Employee Integrity and
Conduct and Ethics Guidelines Ethical Conduct Regulations
Policy
Promoting all employees to S t reng then ing in te rna l Promoting all employees to
abide by integrity and controls preventing fraud abide by the law maintain
Goal Internal Control Construction
p r o f e s s i o n a l e t h i c s risks establishing anti-fraud integrity and self-discipline
ensuring compliance with mechanisms and ensuring and adhere to professional
legal and ethical standards. the company's health and ethics preventing corruption To effectively strengthen the internal control system the company focuses on system development top-level
sustainable development. from occurring. design and system review.In 2022 collaborating with all BUs the company audited new unit systems from a risk control perspective
suggesting modifications and optimizing processes. This reinforced internal control management and ensured the
Report and Complaint achievement of business goals.The company establishes a robust complaint and reporting management mechanism standardizing channels and
processes for timely and effective handling. Diversified reporting channels are publicized through various means.Hengyi encourages real-name reporting and strictly protects whistleblowers' information and identities. When Internal Control Process
accepting or verifying reports personal safety and identity are safeguarded. Obstruction or suppression of
reporting is not tolerated and retaliation against whistleblowers is dealt with accordingly involving judicial
authorities if necessary.Conduct an assessment and
Improve OA process for new optimization of the key control
creation and change review KCP assessment points (KCP) of the engineering
nodes assess the risk of the company integrate internal
process balance efficiency control into the process and
Anti-Fraud Office reporting channels improvement. Process optimization p r o m o t e c l o s e d - l o o pext ） management.Phone：0571-83581890（ ：1890 Fax：0571-82797666Email：fwb@hengyi.com
1415
Social Responsibility Governance H E N G Y IKey Business Audit
Focusing on the company's core the audit work aims to "prevent risks control costs strengthen management and Investor Relationship
promote standardization." Targeting key business areas a diversified audit model of "routine + special + continuous
supervision + spot checks" is implemented for audit oversight fulfilling internal audit responsibilities and ensuring
the effective improvement of the company's risk management level.Hengyi values information disclosure following laws and regulations establishing a rigorous
Finance Procurement process striving for timely and accurate disclosure. The company engages in various investor
relations activities proactively communicating with investors showcasing development highlights
conveying investment value and safeguarding their rights.。
Key Audit
Logistics Areas Sales
Raw material
Production supply and trade Official website's WeChat official P5W performance SZSE interactive
Investor Hotline investor relations account briefing platform
section
Project Audit
The company values project auditing standardizes the auditing process focuses on the foundation of project
auditing and continuously improves audit quality. In 2022 with 'full-process project tracking' as the core method the
company regularly tracks project bidding dynamics and conducts monthly routine inspections of engineering
projects ensuring all activities are within the scope permitted by laws and regulations.Perform monthly routine inspections of The company strictly follows laws and regulations to ensure high-quality information
engineering projects in subsidiaries disclosure. It continually improves governance and uses designated media to comply with
combining with ongoing reviews. Regularly track the dynamics of regulations and strengthen communication with investors.Provide timely feedback on findings and Full-process project bidding monitoring each
track progress of rectification require Project Tracking stage from bid prequalification
prompt recording by departments for evaluation to final awarding.future settlement basis and optimize In 2022 the company disclosed 241 announcements including 4 regular reports.management.
1617
Communication Channels
Social Responsibility Governance H E N G Y IStakeholder Communication Materiality Analysis
Hengyi's main stakeholders include government agencies shareholders customers employees and communities.The company engages with them through various channels to understand their concerns and expectations. Hengyi involves stakeholders in topics
identification to understand their sustainable
development expectations and concerns and
to focus on ESG practices and disclosures.Stakeholders Topics covered Communication Channel The company has a process for analyzing
sustainability topics including identification
Business ethics assessment and selection.Compliant operations
Clean energy Symposium and seminar
Government and
Climate change Project approval
regulators
Water resource Government regulation
Pollutant management
Innovation 01 Identification
Innovation Corporate annual reports Considering national policies industry
Climate change and announcements trends peer sustainability benchmarking
and the company's development strategy
Clean energy Roadshow
and social responsibility standards the
Shareholders Digitalization Special meetings
company establ ished a sustainable
and investors Risk control Hotline development topic repository.Performance IR website
Anti-corruption Market conference
Services 02 Assessment
Product quality and service
Client meeting
Clients Green innovation
Questionnaire Conduct research on the importance of
Circular economy
Website and WeChat topics for stakeholders such as investors
customers suppliers and communities
Staff and workers' congress while assessing the relevance to global
Safety management
Manager's mailbox s u s t a i n a b l e d e v e l o p m e n t g o a l s
Training and development stakeholders' concerns and their importance
Employees Training
Diversity to Hengyi.Culture acvtivities
Well-being
Website and WeChat
Supplier assistance
Suppliers Resposible procurement
Supplier training 03 Priorization
Climate change
Pollutant management Environment performance Based on the assessment results prioritize
Community Clean energy data collection and disclosure topics have them reviewed by the
Resource recycling External survey company's governance level and experts
Water resource Media communication and select the substantial topics for key
disclosure.
1819
Social Responsibility Governance H E N G Y IESG Importance Matrix in 2022
Medium importance High importance
6
11758
9
3
121
2
4
13
1514
1710
Low importance 16
Importance to Hengyi
Level No Topics
1 Climate change
2 Water resource management
3 Pollutant management
4 Clean energy
Core Issues 5 Safety management
6 Product quality and service
7 Green innovation
8 Compliance
9 Business ethics and anti-corruption
10 Innovation
11 Resource recycling
12 Employee well-being
Important Issues
13 Employee training
14 Responsible procurement
15 Circular economy
16 Digitalization
General Issues
17 Diversity and equality
20
Importance to stakeholdersCommon Prosperity
-Responsibility
Hengyi supports national policies of common prosperity and rural
revitalization. We focus on employee development and welfare and fulfill
social responsibilities to contribute to achieving national goals.Employee well-being
Rural Revitalization
Charity
Hengyi has always valued the rights and welfare of employees and strictly abides by
relevant domestic and international laws and regulations while establishing and
Employee
continuously improving internal employment regulations. We strive to build a diverse
well-being
and inclusive team provide a positive equal and harmonious working environment for
employees. To protect employee rights we have established a scientific salary and
benefits system as well as an employee care system to care for employees in all
SDGs we focused
aspects and improve their sense of happiness belonging and job motivation. We
in this section：
believe that only when employees are satisfied can the company develop and
innovate better.
23
Social Responsibility Common Prosperity H E N G Y IIncentives Well-being
Hengyi has a comprehensive salary and benefits system with external competitiveness and internal fairness. They
implement a salary control policy to improve internal management and provide salary incentives to promote
personnel efficiency. Salary standards are determined based on job responsibilities and employee competency. Employee Benefits
Different salary incentive policies are provided for different types of employees and performance rewards are given
based on performance appraisals.Hengyi prioritizes employee benefit while
Contract Social Security Health&Safety
strictly following national policies and Signing Rate Coverage Training Coverage
l a w s . T h e c o m p a n y p r o v i d e s
comprehensive employee benefits 100% 100% 100%
including social insurance housing and
transportation allowances statutory
holidays and employee training and Physical Labor Union TrainingExamination
education. In 2022 these benefits
Coverage Participation
Coverage
covered all employees ensuring their
welfare and rights. 100% 100% 100%
Brunei Project
We place great emphasis on
employee salary and benefits
worldwide. For example in our Epmployee Shareholding Plans
Brunei project the salary
Vacation The company enforces policies to ensure employee vacation
standards are higher than the
Hengyi is committed to the "people-oriented" concept
local industry average. Hengyi
fu l ly mobi l iz ing employee enthusiasm and
v a l u e s t h e s t a b i l i t y a n d
continuously attracting and retaining outstanding The company provides a health room with medicines health monitoring instruments
recognition of the local employee
management talents and business backbones while health examinations lectures and insurance coverage including employer liability Healthcare
team and offers competitive group accident medical mutual aid and supplementary medical insurance.balancing the interests of the company shareholders
compensation to attract and
and employees. The company has implemented four
retain outstanding local talents.employee shareholding plans three equity incentive
This also contributes positively to
plans and three repurchase plans since 2015. In The company assists employees with household registration and children's
promoting local employment and
October 2022 Hengyi launched the third share education and sends Hengyi Family Letters to outstanding employees'
improving the community's Life support
repurchase plan using its own funds to repurchase families during Chinese New Year to convey gratitude and blessings.standard of living.shares for implementing employee shareholding plans
or equity incentives at a price not exceeding RMB 11.5 Benefits
per share. The company offers free shuttle buses and subsidies for employees using
In April 2021 the company announced the fourth Commute
their own vehicles and provides vehicle subsidies for eligible
management personnel.employee shareholding plan benefiting nearly 5000
employees with a total amount of RMB 1.6 billion. The
lock-up period for the fourth plan's shares expired on The company has an internal canteen and ensures quality meals by
September 23 2022. Cash dividends of RMB strengthening food safety supervision controlling prices and offering signature
Canteen
22750920 have been distributed to the employee dishes for employees to enjoy
shareholding plan.The company offers housing support including various room types and rental subsidies for eligible
Accommodation employees.
2425
Social Responsibility Common Prosperity H E N G Y I
HighlightsFamily Care Diversity & Equality
The company cares not only for its employees but also their families by organizing activities such as visiting families
The company follows all internationally recognized human rights policies outlined in the United Nations Universal
during holidays distributing gifts and organizing summer camps for employees' children in 2022.Declaration of Human Rights International Covenant on Civil and Political Rights and core conventions of the
International Labor Organization. It strives to create a diverse inclusive and fair employee team and prohibits
child labor and forced labor while respecting the legitimate rights and interests of all employees."
Summer Camp
Gender Equality
To address the challenge of child
care for dual-working families The company values diversity and The company values the physical and mental health of
during summer vacation the gender equality with female employees female employees and has established a labor
c o m p a n y p a r t n e r s w i t h comprising 26.37% of the workforce protection and safety production system for them. It
universities to organize the Little including four executives and 162 organizes various activities to raise awareness of health
Bird Summer Camp a few-week middle-level managers. Women have care and celebrates International Women's Day by
summer art camp for employees' played a crucial role in the company's carrying out activities to show care for female
children. The camp provides development and contributed to the employees and enhance their sense of happiness in
tutoring and fun activities f o r m a t i o n o f a n i n t e r n a t i o n a l work and life.enhancing employees' sense of professional and career-oriented
belonging and happiness. management team.Employees number:15637
Overseas employee protection
Female employees:26.37%
The company p rov ides Female executive number:4
overseas personal accident
insurance for employees in
Female in middle management:162
Brunei and offers two paid
home leave trips per year with
travel expenses fully covered College degree or above:33%
by the company to ensure
employees can reunite with Ethnic minorities:7.15%
their families regularly and
enhance their sense of
belonging. Outsourcing staff:1450
Local staff in Brunei projects:32%
2627
Social Responsibility Common Prosperity H E N G Y ICulture Activities
To enrich employees' spiritual and cultural life and
to let them truly feel the care and warmth of the
company while improving their happiness Hengyi
actively organizes various cultural and sports
activities entertainment events and club activities.In addition to enhancing employees' physical
fitness these activities also further enhance the
company's cohesion.Spring Festival Policy and Benefit
To ensure stable workforce and normal production
Hengyi has launched the Spring Festival job stability
policy for its employees providing on-duty subsidies
and implementing staggered leave policies for
employees from other regions. The company
encourages its subsidiaries to carry out various
employee care activities before and after the
Chinese New Year according to production
conditions showing appreciation for those who
choose to stay on duty during the holiday and
creating a good atmosphere of care and support for
employees from other regions fostering employee
loyalty.Human Right-Brunei Project
As a key project of China's "Belt and Road"
initiative the Hengyi Brunei petrochemical project
strictly adheres to Brunei's labor laws and
Care for Disabilities regulations prohibits child labor and forced labor
and provides employees with a standard working
and living environment. To ensure the legitimate
Hengyi upholds equal and non-discriminatory employment and values the rights and interests of each employee the
employment and social integration of vulnerable groups including over 600 company provides 100% labor protection
disabled employees who contribute to the company's development. May is equipment and medical facilities to ensure that
designated as Disability Service Month during which the company organizes employees receive timely treatment in the event of
activities to support disabled employees' work and life and also regularly holds an accident.health and cultural events to enrich their spiritual life.As of the end of 2022 there were a total of 665
local employees in Brunei accounting for 32% of
the total employees in the Brunei project.
2829
Social Responsibility Common Prosperity H E N G Y IPercentage of Employee Turnover
By age By gender
and below
Male
Female
and above
Talent Development
Hengyi prioritizes diverse talent development and offers customized training programs to employees based
on their job requirements and interests. We believe this promotes their long-term career growth by Continuing Education for Front-line Employees
enhancing their professional skills and knowledge.Hengyi has partnered with various schools supported by labor unions to offer continuing education opportunities
We cultivate employees' business development capabilities through activities such as product knowledge
for front-line employees. Over the past decade this has enabled numerous employees to further their education
and sales case development sales case competitions and sales-related courses. We also cultivate sales
while working resulting in an effective internal talent supply chain and the development of a group of enterprising
experts into internal trainers to enhance our sales talent development system and business capabilities."Hengyi craftsmen." Almost 1200 industrial workers with a high school diploma or below have obtained diplomas of
associate degree or higher while working in frontline positions with an improvement rate of nearly 98%.New-blue Program Front-line Manager Program Hengyi University
Hengyi 's talent reserve Skill CertificationThe company launched training Hengyi Univers i ty 's on l ine
project is a core program for programs for industrial managers platform has been operating for 5
developing future talent focusing on team building and years with over 5000 learners
As a pilot unit for occupational skill level certification in Xiaoshan District Hengyi has actively
through systematic training of improving personnel efficiency and 200+ courses covering
improved its employee skill development system through the mechanism of "training through
new college graduates. The covering 14 companies and nearly various dimensions. It plays a
assessment." Employees are encouraged to innovate and provide rational suggestions creating a
New Blue Program in 2022 800 individuals. Improvement actions c ruc ia l ro le in mot iva t ing
positive competition atmosphere and cultivating skilled talents guided by the principles of "strong
trained nearly 180 college we re t aken t o enhance t he employee learning improving
skills dedication and innovation."
students through various management skills of front-line their overall level and creating
courses. managers creating a positive enterprise knowledge assets During the two-year pilot period over 1500 employees participated in the company's skill
management a tmosphere fo r while enhancing the efficiency of certification program with close to 1300 employees obtaining certificates and a pass rate of 83%.industrial workers. training management. The job stability rate among certified employees was as high as 95% improving the stability of
front-line employees.
3031
Social Responsibility Common Prosperity H E N G Y IDonations
Hengyi established two named funds with a total of RMB 100 million to support charitable public
welfare activities with the amount of the "Hengyi Charity Fund" in Xiaoshan District increased to
RMB 125 million in 2022. The donated funds will be used for initiatives such as "Spring Breeze
Action" and "Assistance for Education."
Rural
Revitalization
Education Support
Hengyi responded to the national call for rural
revitalization by participating in targeted poverty
alleviation activities and supporting education in the
western region. The company donated RMB 27
million to support the construction of the Hongde
Hope Primary School project in Hongshibao district
Wuzhong City Ningxia.The company fulfil led its corporate social
responsibility by supporting education and improving
local living standards aiding the poverty alleviation
efforts and rural revitalization.
3233
Social Responsibility Common Prosperity H E N G Y IUniversity Cooperation Joint Talent Cultivation
Hengyi-Politeknik Brunei
Hengyi collaborates with major universities in industry-academia-research
cooperation to promote STEM education and support its own product research
Charity Hengyi collaborates with Politeknik Brunei to offer seven majors and participates in all aspects of the cooperative
and technological innovation. The company has formed strategic partnerships with
education program including setting up courses recruiting faculty and organizing teaching. Students spend their
well-known universities and research institutions based on the "integration of
third year at the Hengyi Brunei Refinery and Petrochemical Project for production internships.industry academia research and application" and provides technical and
financial support for the transformation of university scientific research
achievements.Hengyi-ZJU-UBD
Hengyi collaborates with Zhejiang University and Universiti Brunei Darussalam to offer the "Hengyi
Petrochemical Talent Class" at UBD in Brunei training eight batches of outstanding UBD students who have
all joined Hengyi after graduation. The Hengyi-UBD-Zhejiang University Scholarship Program has trained 167
Brunei students and 91 of them have been employed by Hengyi in the Brunei PMB project promoting the
long-term development of cooperation between the two countries.State Recognized Donghua University
Technology Center -Hengyi Joint Laboratory
ZJU-Hengyi Gloval Innvation Research Center
Brunei——Support Local Youth Hengyi-LZPCC-IBTE
Hengyi in cooperation with Lanzhou
Petrochemical University of Vocational
As the largest overseas direct investment project in Brunei in recent
Technology and the Institute of Brunei
years the Hengyi Brunei Refinery and Petrochemical Project has long-
Technical Education has launched a
term benefits for the local community promoting local employment and
program to offer automation control
economic development. The company's localization strategy involves
major aiming to cultivate 600 skilled
partnering with local universities to cultivate local young talents in
petrochemical talents in Brunei
Brunei promoting local employment and improving the quality of the
through a three-year international
youth. This helps to achieve Brunei's vision for 2035.education module.
3435
Social Responsibility Common Prosperity H E N G Y IEducational Donation
ZJU Hengyi Scholarship
Hengyi donated RMB 10 million to establish
the "Zhejiang University Hengyi Fund" in 2007.Over the past 16 years Hengyi has donated a
total of RMB 200 million in five installments to
support the Hengyi Scholarship Hengyi
International Exchange Scholarship Research
Fund and Social Practice Assistance. In 2022
Hengyi donated RMB 50 million to support the
construction of the "Double First-Class"
university.Special Needs School in Brunei
Hengyi donated 50000 Brunei dollars to
YSHHB charity foundation in 2022 to support
the establishment of the first special needs
school in Brunei.Voluntary Blood Donation
In 2022 the company organized its 21st collective unpaid blood donation activity for employees. 302 employees
successfully donated 97080 ml of blood setting a new record. The Brunei company's employees also responded to
the local government's call and donated blood.
36Green Production-
Carbon Net-zero
Hengyi aims to be a respected global green petrochemical company and
is actively working towards national carbon reduction goals. Through Climate Change
technological upgrades clean energy usage and energy management
Hengyi is improving its green production level and fulfilling its carbon
control responsibilities. Hengyi is actively responding to the national strategic goals of "carbon peak" and "carbon
neutrality" and in 2022 the company continuously improved its green production level
through measures such as technological upgrades and energy management fulfilling its
social responsibility of carbon control and emission reduction.Climate Change
Water Resource Management
Pollutant Management Energy Conservation and Emission Reduction
Clean Energy
The company responds to the national call to eliminate outdated production capacity and upgrade the
industry. It optimizes and upgrades equipment and processes and takes measures such as boiler
upgrades waste heat recovery and denitrification systems to reduce energy consumption meet
environmental standards and lower carbon emissions.SDGs we focused In 2022 the company upgraded built renovated and eliminated about 39 boilers resulting in a 4%-6%
in this section： reduction in overall energy consumption and significant energy conservation and emission reduction.
39
Social Responsibility Green Production H E N G Y IUtilization of Polyester Exhaust Heat
The company uses its practical experience in long-term polyester equipment operation to improve the utilization of Water Resource Management
polyester exhaust heat and promote energy conservation and emission reduction.Measures：
Saves fuel by heating fresh ethylene glycol with exhaust heat through a heat exchanger； Hengyi focuses on water resource management and reduces water usage and pollution through water-saving
Utilizes waste heat to improve the temperature in the DTY workshop and maintain a reasonable temperature in case of low measures sewage and wastewater treatment and reducing pressure on local water resources caused by
ambient temperatures or reduced machine operation thus reducing electricity consumption in the hot box； production operations.Evaporates liquid working medium with esterification exhaust heat to generate electricity through continuous operation of the
screw expander achieving energy-saving goals..In 2022 the company saved about 8200 tonnes of coal and 18000 tonnes of steam by recovering
and utilizing polyester exhaust heat.Cooling water
recycling Refrigeration
100% Pre-treatment Boiler
Reuse Equipment Cooling
Water
Conversion of Natural Gas Boiler
Hengyi utilizes the low corrosiveness of natural gas boiler flue gas which is achieved through the conversion
of natural gas boilers to replace steam for heating the stripping tower.Product cooling
93.75% Desalination
In 2022 the company saved approximately 7200 tonnes of steam through the transformation of hot Oil blending
weather boilers. Fresh water
Restaurant
Utilization of Heat from Sulfuric Acid Plant
6.25% Greens
High-temperature flue gas from sulfur combustion in the sulfuric acid plant is utilized to heat the nylon
polymerization heat transfer oil. Toilet
In 2022 the company saved approximately 4000 tonnes of coal.Water Saving
Integrated Utilization Exhaust Gas from Cyclohexanone Plant
The company implements high-efficiency water production and reuse water as well as water-saving
The company uses advanced catalytic fuel purification technology to improve the utilization rate of oxidation
measures in cooling towers.exhaust gas from the cyclohexanone plant which is then used for power generation through expansion and the
recovered energy is discharged into the atmosphere. In 2022 the company saved a total of about 5.1 million tonnes of fresh water.In 2022 the company saved approximately 1696.8 million kWh of electricity through this technology.
40
41
Water Footprint
Social Responsibility Green Production H E N G Y IHigh-Efficiency Water Production Pollutant Management
The company used the EFDT process to transform the
original desalination process replacing inefficient
technologies and solving problems such as high inlet
water requirements low product water yield and high In 2022 the company prioritized environmental protection and extended its environmental management to ensure
energy consumption. compliance with standards for wastewater and exhaust gas.In 2022 through the above process transformation the The specific work done by the company in environmental pollution prevention and control in 2022 includes:
company reduced its water consumption per ton by
about 30% and each water production equipment set
saved about 810000 tonnes of water per year.Track and organize each subsidiary company's three-waste emissions
Review the current and monitoring emergency environmental contingency plans as well
situation as discharge permits and pollutant emission indicators
Reuse Water
Participate in
The company achieves water reuse by treating environmental Participate in environmental assessment before acceptance for new
wastewater with various methods resulting in an assessment before
production lines factories and renovations of each subsidiary company
overall water reuse rate of 87-93%. acceptance
In 2022 through water reuse technology the
polyester factory under Hengyi saved about 4.23
million tonnes of fresh water. Carry out
environmentalimprovement and Actively respond to the "zero discharge of sewage”
enhancement
Improve the
monitoring system
Cooling Towers The compliance rate of wastewater rainwater (pH COD NH3-N) and and enhance the
boiler flue gas (particulate matter SO2 NO2) for each subsidiary
data assessment
platform company is 100%
By retrofitting the existing cooling tower the water
loss caused by evaporation wind discharge and
leakage is reduced.It helped the company save about 20000 tonnes
Communicate and Coordinate with government environmental protection departments to
of water annually. coordinate with handle abnormal on-site monitoring data for subsidiary companies and
Regulators avoid penalties
4243
Social Responsibility Green Production H E N G Y IPollution Prevention and Control
The company follows the "separate by pollution type rainwater and sewage and
industrial/domestic wastewater" principle. They have a good wastewater collection
system and use "pretreatment + anaerobic + aerobic" treatment process. Some
treated water is reused and the rest meets GB31752-2015 standards before
Sewage
entering the sewer network.The company uses source control and treatment measures to reduce waste gas
emissions. The organized emissions of dust non-methane total hydrocarbons and
formaldehyde comply with the relevant standards in the "Emission Standards for
Pollutants from Synthetic Resin Industry" (GB31752-2015). For the emissions from
coal-water slurry boilers in Hangzhou the "Emission Standards for Atmospheric
Waste gas Pollutants from Boilers in Hangzhou" are followed and for other areas the
"Emission Standards for Atmospheric Pollutants from Boilers" (GB13271-2014) are
followed. The emissions of odorous pollutants comply with the relevant standards in
the "Emission Standards for Odorous Pollutants" (GB14554-93).The company manages waste according to the principles of resource utilization
reduction and harmlessness. The temporary storage of hazardous waste strictly
follows the relevant regulations in the "Pollution Control Standard for the Storage of
Hazardous Waste" (GB18597-2001) while general solid waste follows the
Solid waste "Pollution Control Standard for the Storage and Landfill of General Industrial Solid
Waste" (GB18599-2020).Clean Energy
Photovoltaic Power
The company supports the "green production" strategy and promotes it by implementing projects such as 100%
coverage of photovoltaic power generation and peak-valley electricity storage to reduce electricity consumption and
carbon emissions.Since 2020 the company has been increasing its investment in photovoltaic power generation.End of 2022: 51 MW photovoltaic capacity annual output 44.2 million kWh.Plan for 2023: 86 MW installed capacity and84 million kWh annual output.
4445
Social Responsibility Green Production H E N G Y IResponsible Procurement
Hengyi improves its supplier management system and practices responsible procurement. We extend our
sustainable development concept to upstream and downstream enterprises and advocate for suppliers to
fulfill social responsibilities.As of Dec 31 2022 the company has 1661 suppliers including 278 active engineering suppliers with a total
Ecosystem- procurement amount of RMB 1.76179 billion and 1383 active material suppliers with a total procurement
amount of RMB 4.3318 billion. We admitted 697 new suppliers in 2022 completed admission materials
Accountability review including legal and bidder qualification confirmation and supplier performance evaluation.Supplier Qualification
The company has established a strict supplier admission management mechanism which includes reviewing
the supplier's agent qualifications ISO9001 ISO14001 ISO18001 system certification status environmental
impact assessment status and wastewater discharge permit acquisition status. The company also conducts
on-site inspections of suppliers and issues inspection reports. In 2022 a total of 161 suppliers were
inspected on-site and 49 inspection reports were issued providing objective evaluations and independent
suggestions for the collection of supplier information introduction of new suppliers resolution of quality
problems calibration fly check of raw material addition fly check of product production fly check of
Hengyi builds mutually beneficial and win-win relationships with suppliers
production site equipment inspection production capacity investigation and maintenance of relationships
customers and other partners jointly fulfilling social and environmental
responsibilities and committed to promoting sustainable development in
the entire industry ecosystem achieving a harmonious and positive cycle
of the value chain.Responsible Procurement
Safety Management
Product Quality & Service
Supplier ESG Promotion
SDGs we focused Hengyi requires cooperation suppliers to follow their ethical and environmental standards. They promote
in this section： ESG concepts with suppliers to reduce negative environmental impacts and enhance social responsibility.The company continuously monitors the supply chain's compliance with its values and standards.
47
Social Responsibility Ecosystem H E N G Y ISafety Management Safety Training
Production Safety Management System
In 2022 the company achieved good safety results by focusing on safety production standardization and
dual prevention mechanisms with no fires personal injury accidents or environmental pollution incidents.The "three wastes" met emission standards.Key measures for safety management
Sign responsibility
The company has implemented "three management and three must" requirements.letters
Promote safety production standardization system: 1.Certify non-compliant subsidiaries; 2.Increase Encourage qualified ones to reach second-level standardization; 3.Improve the system of certified
subsidiaries.11 subsidiaries meet the safety production standardization requirements: x at first level
investment in
x at second level 1 striving for second-level and 9 at third level.safety Investing in safety and environmental protection and improving production conditions:
During the reporting period the company invested RMB 31.1276 million in safety and RMB 80.1008
million in environmental protection enhancing facilities to improve safety.HSE legal compliance assessment: Updated the "HSE Law and Regulation List" by adding 99 new
Review HSE standards and updating 16 resulting in a comprehensive list of 362 applicable HSE regulatory
regulatory standards. The assessment ensures compliance with relevant laws and regulations.Standards&
Conduct HSE On-site HSE inspections are conducted using multiple methods to increase frequency and intensity
hazard and detect and eliminate potential hazards. Inspection methods include leader-led inspections and
investigation strict control of key project nodes. Analogical investigations and safety transformations are The company prioritizes employee safety education and training for all levels of staff
conducted on accident-prone areas including the short fiber post-spinning process and elevators.covering major responsible persons safety production management personnel special
operations and equipment operators and other practitioners. In 2022 occupational
health training was provided through various opportunities such as pre-shift and post-
shift meetings and team safety activities.Enhance safety Conduct safety education and training according to different needs.training Carry out various safety activities to strengthen employees' safety awareness and skills.I den t i f i ca t i on o f The influence of
Strengthen Establish environmental risk management accounts for subsidiaries continuously track and rectify 01 occupational disease 02 occupational hazard
environmental potential hazards and strive to reduce environmental compliance risks.factors on health
protection process hazard factors Manage environmental facilities for normal operation conduct surprise inspections to enforce
management environmental protection measures ensure compliance of waste gas and wastewater discharge
standards and properly dispose of solid waste.The employer's legal
How to prevent duties in the prevention
0304
occupational diseases
In 2022 Hengyi Annual investment and treatment of Closed
96 Identified351 346 in safety RMBcarried out occupational diseases
hidden hazards
inspections hazards 31.13 million
Rectification The company conducted a total of 919 training sessions training a total of 47725 people.Issued 24 completion
problem rate98.6% Training achieved a 100% completion and qualification rate with emphasis on key points and
notices
full staff coverage.
4849
Social Responsibility Ecosystem H E N G Y IProduct Quality & Service
Quality After Sales
To produce high-quality products Hengyi has established the "Hengyi Chemical Fiber Product Enterprise
Internal Control Standard" system to manage all of its products including PET POY FDY DTY PSF and The company has established a diversified channel customer satisfaction survey
Pa6. The system covers product grading and production process control and categorizes products into mechanism to help improve Hengyi's product quality.three levels of quality: excellent (AA) first-class (A) and qualified (B). Products below the qualified level are
The company uses diverse channels such as a "WeChat mini-program mall" on-site visits by salespeople and
considered substandard (C). This ensures that the quality of the products meets customer requirements.phone calls to collect customer satisfaction-related information particularly on product quality. This aims to improve
The company also implements a monitoring and control system for quality management such as the
product and service quality and increase customer satisfaction."Product Center Value Management Measures" to stabilize product quality and control fluctuations in
related quality indicators during the production process. The company continuously improves and revises its
operating procedures to ensure that employee operations are standardized. Additionally the company
strengthens its equipment management and abnormal inspection management to ensure stable product The company has an after-sales service department with a complete management
system and process to handle product quality issues and customer service.quality.Furthermore the company integrates production digitization to strengthen its overall quality management. It
tracks the quality of raw materials machinery and accessories manages production process anomalies The company improves after-sales service efficiency and effectiveness by providing technical support and
and manages end-product quality using big data to plan implement monitor correct and improve the addressing customer feedback through quality improvement returns and exchanges resulting in improved
entire quality management process. In 2022 the company's product quality inspection qualification rate customer satisfaction.reached 100% and the product recall probability remained stable between 0.02% to 0.04%.In 2022 customer satisfaction with after-sales events reached 97%.
97%
95%
93%
Key performance 2020 2021 2022
In 2022 the company had a100% product quality inspection qualification rate and a stable
2-4 customer satisfactionproduct recall probability of %00.
5051
Social Responsibility Ecosystem H E N G Y IGreen Hengyi prioritizes market demand and green environmental protection in
Innovation its R&D efforts committed to offering eco-friendly and healthy products to
downstream customers and end consumers in the industry chain.Innovation-
Sustainability
YiTaiKang
Amidst the global trend of green development titanium catalysts have become the best alternative to
antimony catalysts. Hengyi's self-developed "Yitai Kang" uses a full titanium composite catalyst system to
replace heavy metal antimony catalysts providing healthier and more environmentally friendly products
for end customers.Hengyi Research Institute conducted related research on the bottleneck problems in the synthesis
of antimony-free environmentally friendly polyester catalysts including catalyst compounding
addition methods polyester polymerization melt stable transportation and polyester spinnability.Hengyi is committed to enhancing its independent innovation capabilities After multiple experiments and optimizations they successfully developed a full titanium-based
and developing high-end and environmentally-friendly polyester fiber composite catalyst system for the production of antimony-free environmentally friendly polyester.products. Through academic collaborations the company has achieved
Using a full titanium-based composite catalyst system "YiTaiKang" not only ensures product quality but
leading technology and unique product diversification serialization and also reduces pollution emissions during production effectively alleviating the pressure of wastewater
quality improvement. treatment for downstream processing enterprises and improving the ecological environment of the
industry chain. The product achieves green circulation throughout the textile product lifecycle from
production to use to recycling making a positive contribution to environmental protection
"YiTaikang" project has achieved large-scale production of high-capacity titanium polyester melt
direct-spun polyester filament with stable production operations and product quality indicators. The
Green Innovation
project has applied for 16 invention patents of which 4 have been authorized and established 4
Circular Economy enterprise standards led the drafting of 4 industry standards and participated in the development
of 1 industry standard. In the future Hengyi will continue to strengthen its technological research
Digitalization and development and innovation to make greater contributions to the development of green and
environmentally friendly industries and social progress.本章所影响的SDGs：
53
Social Responsibility Innovation H E N G Y IAntibacterial
Polyester
Hengyi is dedicated to green low-carbon transformation building a circular
Circular economy and promoting the development of green industrial chains such as
Economy the recycling of waste polyester and bio-based polyester in order to achieve
product circularity. Through technical expertise Hengyi transfers waste or
discarded products from landfill sites and converts or reuses waste into
higher value products. The future product portfolio will include many
technologies specifically developed for reusable materials seeking more
waste and carbon reduction solutions for the industrial ecosystem.Recycling of
Waste Polyester
Green consumption and a focus on healthy living are driving growth potential in the anti-bacterial textile
market. Silver ions are harmful to health and restricted copper ions lower product quality while zinc
ions provide a durable anti-bacterial effect without any health or quality issues. Hengyi's polyester production has exceeded 10 million tonnes but waste such as
waste fibers are produced causing waste and increased costs. Clothing waste is
also increasing due to improving living standards. Traditional methods of handling
waste polyester such as landfill or incineration have a significant impact on the
environment economy and society. Therefore recycling waste polyester is not
We made anti-bacterial polyester slices and fibers by mixing nano-zinc oxide PTA and EG then
only necessary for the company but also a social responsibility as it is important for
pulping esterifying condensing and spinning. The slices showed good filtration performance and even
saving resources reducing pollution and reducing carbon.distribution of nano-zinc oxide. The project has a pending invention patent and was approved for key
research in Zhejiang Province in 2022.The "14th Five-Year Plan" encourages a circular economy and green design in the
polyester industry improves the system for recycling waste textiles regulates the
The anti-bacterial polyester slices have slightly higher crystallization temperature and viscosity but are
development of the waste textile regeneration industry and strengthens policy
otherwise similar to conventional ones and are stable during spinning. The resulting fabrics have a 99%
support. The goal is to establish a preliminary circular system by 2025 and
inhibition rate against three types of bacteria and are widely used in medical materials high-
improve it by 2030.performance home textiles and sports clothing offering a promising market and economic benefits.The recycling of waste polyester is divided into two ways. Chemical recycling can
expand the scope of waste polyester to fibers and fabrics while physical recycling
is only applicable to waste bottle flakes. The industrial chain planning of waste
polyester is mainly divided into three stages: chemical depolymerization into
Flame Retardant monomers or intermediates preparation of various polyester materials and
Polyester preparation of high-value-added materials.The five specific layouts for the recycling of waste polyester by the Hengyi Institute:
HFRPET is stable durable water-resistant and
Our HFRPET is a halogen-free phosphorus- disassembling waste polyester into monomers or intermediates using industrial environmentally friendly with no toxicity. It
based f lame-retardant polyester with a alcohol methods; processing glycol monomers to produce various polyester overcomes problems such as poor water
phosphorus content over 6500 ppm and a fabric materials; using glycol monomers in existing systems to produce high-value resistance poor hand feel and fading found in
limiting oxygen index over 30%. It meets national polyester; preparing polyester into para-aramid used in industries such as other flame-retardant fabrics. The brightness of
and American standards and covers products automotive communication and safety protection; gasifying waste biomass and the slices and yarns is superior to market
such as POY FDY DTY and slices. urban garbage to produce high-purity hydrogen gas through high-temperature alternatives and can be used for all types of
processing. The Hengyi Institute will fully implement these five industry layouts to
flame-retardant fabrics
support the green circular economy of the Hengyi industry.
5455
Social Responsibility Innovation H E N G Y ICloth Hengyi follows the industry's development trends and is committed to promoting
the digital transformation of the chemical fiber industry. From automation to
cloud computing they have been exploring and implementing various digital
Digitalization solutions. They continue to deepen the development of the industry's digital
platform and embrace new technologies to explore and visualize the digital
Fabric Fiber
textile separation value of the industry.Fiber
regeneration
Digital Decision Support System-Hengyi Brain“Hengyi Brain" is a management information center system for corporaterPET management which can break through data isolation and realize indicator
analysis and decision-making scenario implementation. Through a detailed
rPET (Recycled PET) is a new type of environmentally friendly recycled fabric made from discarded cola and plastic indicator system Hengyi Brain can reflect the company's operating status in
bottles which is of great significance for environmental and resource protection. Hengyi uses physical and chemical real time and visualize the collected data. This "one-stop" decision support
recycling technologies to recycle and reuse waste plastic bottles. In 2022 Hengyi's rPET production capacity is system provides timely and effective decision-making information for senior
about 50000 tonnes. management.Physical recycling Chemical recycling
The technology mainly involves putting the waste The technology breaks down the waste polyester Digital Factory
bottle flakes into a vacuum reactor and carrying into small-molecule polyester monomers
out surface dewaterting hot melting internal removes impurities and colors and then The digitized factory presents integrated production supply and sales data
dewatert ing and wastewater discharge repolymerizes the purified monomers into from the perspective of the factory dimension providing data reference
processes in sequence to achieve the recycling polyester thus achieving the purpose of services for the production and sales coordination of the factory's general
and reuse of polyester. recycling and reusing waste polyester. manager based on the enterprise brain. With the data refined to the factory
end through the Hengyi big screen non-intrusive intelligent data acquisition
tools are deployed at the digital production monitoring level to collect core
process data from the factory's spinning upper computer every minute thus
Biobased Polyester achieving trend analysis of real-time production process data and providing
on-site warnings and operation feedback. At the digital business
Hengyi supports research on multiple bio-based materials which use agricultural and forestry waste as raw management level the system improves the factory general manager's
materials to maximize resource utilization and reduce oil consumption and carbon emissions. These materials are decision-making and coordination abilities by presenting comprehensive
safer and more recyclable. Through collaboration with Zhejiang University Hengyi has developed high-quality PEF and refined data on production sales quality energy consumption and
and a series of copolyesters using an efficient polymerization catalytic system. Hengyi plans to promote the inventory thus achieving higher efficiency.development of the emerging bio-based materials industry realize a closed-loop cycle of carbon dioxide and
contribute to global energy structure adjustments by reducing carbon emissions in the polyester industry.
5657
Social Responsibility Innovation H E N G Y IAI Inspection System
Sophisticated AI algorithms are used by Hengyi and Baidu to analyze
complex product surfaces. This technology combines traditional
optical imaging with intelligence to solve the limitations of traditional
machine vision recognition. The AI inspection equipment has 100%
detection rate for silk cakes with a 2.5 second inspection time per
product increasing efficiency by 70% compared to manual inspection.This intelligent inspection equipment will become an important
component of the production line improving product quality and
efficiency and injecting new momentum into intelligent manufacturing.Hengyi Brain
Real time Production Real time Gains & losses Empirical
Market Index Sales Order benefit Core index on inventory dynamic trend
Digital Marketing
Sales team
Real-time market Sales ranking
performance
By factory
Factory production
Polyester core index Order benefit Screenand sales rate
Inventory structure Overage physical
analysis Equity inventory inventory
Logistics system
In response to the company's "Chemical + Logistics" strategy the subsidiary logistics
company will build itself into a modern large-scale professional logistics enterprise
Digital Factory that matches Hengyi's capacity and provides transportation tasks for raw material
supply and product sales achieving the goal of self-owned vehicles. However for
Real-time on-
Production index Production event many years the dynamic management of logistics transportation business has mainly
machine task
relied on manual offline contact or communication through WeChat and QQ. In terms
By SKU screen of raw material transportation maintenance management distribution bill
Production&Sales Premium quality Product quality Sales/Marketing
/Production reconciliation and salary calculation it is mainly achieved through manual statistics change and batch analysis inventory indicators
using EXCEL spreadsheets. To comprehensively develop the logistics company a
complete logistics transportation information system is urgently needed including an
Raw material
inventory intelligent scheduling module to improve the efficiency of various aspects of work.The system will realize real-time sharing of business data and data statistical
analysis truly enhancing the efficiency of logistics capacity and comprehensively
improving the overall efficiency of the logistics company.
5859
Social Responsibility Innovation H E N G Y IProcurement System
The goal of this project is to develop a procurement management information
system for engineering projects and daily procurement activities including
SRM (Supplier Relationship Management) and SCM (Supply Chain
Management) systems to help achieve comprehensive automated
procurement management.The SRM system helps users and suppliers establish an information exchange
platform facilitating supplier registration admission assessment sourcing
identification inquiry comparison bidding and other business coordination and
also providing supplier performance assessment.SCM system can automate procurement management from demand planning
requisition purchasing strategy supplier business collaboration procurement
contract receiving and acceptance quality inspection funding planning and
payment request to the entire life cycle of procurement operations.The system also links project purchase orders with project investment codes
and general budgets generating an analysis table of investment project
purchase budget amounts and completion progress. After the system is
implemented procurement officers will save a lot of time and energy reducing
manual data entry and statistics work and focusing more on procurement
progress and cost analysis actively realizing project cost optimization goals
and effectively reducing the risk of human error.Data Security
Recognizing the importance of corporate data security under the trend
of national attention to information security Hengyi has established
relevant network security policies to protect confidential information and
ensure safe operations.We implement a graded management system for company information
and set access permissions for confidential and sensitive information.Access permissions are recorded and adjusted/removed as necessary
when employees transfer or leave the company. We monitor network
traffic hire third-party security organizations for regular security and
privacy checks reinforce security tools conduct security penetration
testing and train employees on network security to raise their
awareness.Date Leak 0 System Breach 0
6061
Social Responsibility Innovation H E N G Y IAppendix
Key Performance Environmental Performance
Indicator Unit 2020 2021 2022
Carbon dioxide emissions 10000 tonnes 867 909 911
Carbon dioxide emissions intensity 100 tonnes/million 1.00 0.70 0.60　Economic Performance
Consumption of crude oil 10000 tonnes 783 828 864　
Indicator Unit 2020 2021 2022
Consumption of natural gas 10000c ubic meters 4497 4601 4443　
Operating revenue 100 million 864 1290 1521
Consumption of electricity 10000 kWh 689966 763655 649377　
Total assets 100 million 927 1055 1120
Consumption of coal 10000 tonnes 179 205 210　
Production capacity 10000 tonnes 3150 3847 3877
Consumption of coal water slurry 10000 tonnes 69 69 41　
- Chemicals 10000 tonnes 265 265 265 Photovoltaic power generation 10000 kWh 1334 2580 4420　
- Refined oil 10000 tonnes 565 565 565
Fresh water withdrawal 10000 tonnes 4081 4144 3214
- PTA 10000 tonnes 1300 1900 1900
Fresh water withdrawal intensity tonne/100 million 47234 32124 21131　
- PIA 10000 tonnes 30 30 30
So2 emissions tonne 844 790 793
- Polyester fiber 10000 tonnes 750 777 807
NOx emissions tonne 2055 2638 2337
- PET（including RPET） 10000 tonnes 200 270 270
COD discharge tonne 622 626 608
- Caprolactam 10000 tonnes 40 40 40
Ammonia and nitrogen tonne 81 83 80
Quality inspection pass rate % 100　 100　 100　
Soot emission tonne 224 235 222
Customer satisfaction after sales % 93 95 95 Solid waste tonne 225804 315422 307058
Solid waste intensity tonne/100 million 261 245 268
Mercury emissions mg/m3 0.000004 0.0000076 0.000043
Weight of hazardous waste tonne 114 234 202
Social Performance Hazardous waste intensity onne/100 million 0.13 0.18 0.14
Indicator Unit 2020 2021 2022
Total number of employees 18154 16820 15637　
Female employees ratio % 25.77 26.17 26.37　
Labor contract signing rate % 100 100 100　
Social insurance coverage % 100 100 100　
Ethnic minorities employees ratio % 6.50 6.45 7.15　
Training time per employee per year hour 96 104 98　
Notes:
Health examination coverage % 80 80 80
Fresh water withdrawal intensity = Fresh water withdrawal/ Operating revenue
Reported accidents 0 0 0　
Solid waste intensity = Solid waste/ Operating revenue
Fatalities from safety accidents 0 0 0　
Safety training time per capita hour 12 12 12　 Hazardous waste intensity = Weight of hazardous waste / Operating revenue
6263
Social Responsibility Appendix H E N G Y IReport Content Indexes GRI 203 Indirect Economic Impacts
203-1 Infrastructure investments and services supported 30
203-2 Significant indirect economic impacts 62
GRI Content Index GRI 205 Anti-corruption
GRI Standards Page 205-1 Operations assessed for risks related to corruption 14
GRI 2 General Disclosures 205-2 Communication and training about anti-corruption policies and procedures 14
2-1 Organizational details 6 205-3 Confirmed incidents of corruption and actions taken 14
2-2 Entities included in the organization’s sustainability reporting 1 GRI 302 Energy
2-3 Reporting period frequency and contact point 1 302-1 Energy consumption outside of the organization 63
2-4 Restatements of information 1 302-3 Energy intensity 63
2-6 Activities value chain and other business relationships 6 GRI 303 Water and Effluents
2-7 Employees 23 303-2 Management of water discharge related impacts 41
2-9 Governance structure and composition 11 303-3 Water withdrawal 41
2-10 Nomination and selection of the highest governance body 12 303-4 Water discharge 41
2-11 Chair of the highest governance body 13 303-5 Water consumption 41
2-12 Role of the highest governance body in overseeing the management of impacts 13 GRI 305 Emissions
2-16 Communication of critical concerns 18 305-4 GHG emissions intensity 63
2-26 Mechanisms for seeking advice and raising concerns 18 305-7 Nitrogen oxides (Nox) sulfur oxides(SOx) and other significant air emissions 63
2-27 Compliance with laws and regulations 11 GRI 306 Waste
2-29 Approach to stakeholder engagement 18 306-1 Waste generation and significant waste-related impacts 44
GRI 3Material Topics 306-2 Management of significant waste related impacts 43
3-1 Process to determine material topics 19 306-3 Waste generated 63
3-2 List of material topics 20 306-4 Waste diverted from disposal 63
3-1 Management of material topics 20 306-5 Waste directed to disposal 63
GRI 201 Economic Performance GRI 401 Employment
201-1 Direct economic value generated and distributed 62 401-1 New employee hires and employee turnover 31
Benefits provided to full-time employees that are not provided to temporary or
201-3 Defined benefit plan obligations and other retirement plans 25 401-2 part-time employees 25
6465
Social Responsibility Appendix H E N G Y ISASB Index
GRI 403 Occupational Health and Safety Code Indicator Page
403-1 Occupational health and safety management system 48
RT-CH-110a.1 Gross global Scope 1 emissions percentage covered under 63
403-2 Hazard identification riskassessment and incident investigation 48 emissions-limiting regulations
Occupational health services
403-3 48 Air emissions of the following pollutants: (1) NOX (excluding
Worker training on occupational health and safety RT-CH-120a.1 N2O) (2) SOX (3) volatile organic compounds (VOCs) and 63
403-5 48 (4) hazardous air pollutants (HAPs)
Promotion of worker health
Prevention and mitigation of occupational health and safety impacts (1) Total energy consumed (2) percentage grid electricity
RT-CH-130a.1
403-7 48 (3) percentage renewable (4) total self-generated energy 2
63
Workers covered by an occupational health and safety management system
403-8 Work-related injuries 49
(1) Total water withdrawn (2) total water consumed
403-9 Work-related ill health 48 RT-CH-140a.1 percentage of each in regions with High or Extremely High 63
Baseline Water Stress
403-10工作相关的健康问题48
RT-CH-140a.3 Description of water management risks and discussion of GRI 404 Training and Education 42
strategies and practices to mitigate those risks
404-1 Programs for upgrading employee 62
404-2 skills and transition assistance programs 30 RT-CH-150a.1 Amount of hazardous waste generated percentage recycled 63
GRI 405 Diversity and Equal Opportunity
405-1 Diversity of governance bodies and employees 12 Discussion of engagement processes to manage risks and RT-CH-210a.1 18
opportunities associated with community interests
GRI 409 Forced or Compulsory Labor
409-1 Operations and suppliers at significant risk for incidents of forced or compulsory 27
RT-CH-320a.1 (1) Total recordable incident rate (TRIR) and (2) fatality rate 62
for (a) direct employees and (b) contract employees
413G-1RI 413 LoOcpael rCaotiomnms uwnitiht ileoscal community engagement impact assessments 32 Description of efforts to assess monitor and reduce exposure
RT-CH-320a.2 of employees and contract workers to long-term (chronic) 49
413-2 Operations with significant actual and potential negative impacts 32 health risks
GRI 414 Supplier Social Assessment Discussion of strategy to (1) manage chemicals of concern
RT-CH-410b.2 and (2) develop alternatives with reduced human and/or 53
414-1 New suppliers that were screened using social criteria 47 environmental impact
GRI 416 Customer Health and Safety Discussion of corporate positions related to government
RT-CH-530a.1 regulations and/or policy proposals that address environmental 22/38
416-1 Assessment of the health and safety impacts of product and service categories 50 and social factors affecting the industry
Process Safety Incidents Count (PSIC) Process Safety Total
RT-CH-540a.1 Incident Rate (PSTIR) and Process Safety Incident Severity 62
Rate (PSISR)4
6667
Social Responsibility Appendix H E N G Y IHengyi Petrochemical Co.Ltd