金发科技:金发科技2022年环境、社会及治理报告（英文版）

Kingfa Science and Technology Co. Ltd
Stock Code:600143
2022 ENVIRONMENTAL SOCIAL& GOVERNANCE REPORT
SHAPING A SUSTAINABLE FUTURE WITH PLASTICC O N T E N T S
About This Report 01 01 Leading Innovation 02 Safety Coming First as Protecting the Creating a Global Brand the Solid Foundation for 03 Environment for a Greener Message from the Chairman 03
Development Future Together
Kingfa at a Glance 05
Independent R&D and Inclusive Innovation 37 Chemical Safety at the Forefront 51 Setting Clear Goals and Improving 61
Management
Our ESG Approach 13 Striving for Excellence Quality and Branding 42 Safety Management and Responsibility Allocation 54 Clean Production and Low-Carbon 63Manufacturing
Overview of ESG Highlights 20
Leading the Market and Serving Customers 46 Safeguarding Occupational Health 57 Low-Carbon Offices and Green Lifestyle 69
in 2022
Features: Make the Best Use of 21
Plastic for a Greener Future
Moving towards Carbon Neutrality 21 04 People-Oriented for 05 Forging Partnerships 06 Building Sustainable A Circular Economy for Plastic 24 Better Lives to Facilitate Industry Growth through
Value Chain Collaboration 31 Flourishing Ethical Operations
Appendix 1: GRI Standards Index 113 Caring for Employees with Equality and 73 Collaboration for Common Benefits 89 Driving Excellence through Standardized 103
Inclusivity Safety and Efficiency Operations
Appendix 2: Provincial R&D Centers 115 Empowering Talents Sharing Value 78 Industry Collaboration for Growth Together 96 Identifying and Controlling Risks 105
Feedback 116 Taking Responsibility and Giving Back to 84 Compliant Operations Transparent 107
Society DisclosureAbout This Report Terms
In this report unless stated otherwise the following words have the following meanings.Company Law refers to Company Law of the People's Republic of China
This report is the first environmental social and governance (ESG) report launched by Kingfa Sci. & Tech. Co Ltd. Articles of Association of Kingfa Technology Co. Ltd.("Kingfa" "the Company" or "we") with the aim of integrating sustainability into our corporate governance and Articles of Association refers to (Revised in 2022)
providing our stakeholders with comprehensive information on our ESG practices and related performance.The Company Kingfa Technology Kingfa refers to Kingfa Sci. & Tech. Co Ltd.Reporting Scope
Shanghai Kingfa refers to Shanghai Kingfa Sci. & Tech. Co. Ltd.This report covers the period from January 1 2022 to December 31 2022 (the " Reporting Period ") with an annual
release cycle. In order to enhance the comparability and completeness of the report some contents may be extended Tianjin Kingfa refers to Tianjin Kingfa Advanced Materials Co. Ltd.from the previous and future years.Guangdong Kingfa refers to Guangdong Kingfa Sci. & Tech. Co. Ltd.Reporting Organization Boundary Wuhan Kingfa refers to Wuhan Kingfa Sci. & Tech. Co. Ltd.This report is based on Kingfa Sci. & Tech. Co Ltd. and covers its subsidiaries (together with its subsidiaries the Chengdu Kingfa refers to Chengdu Kingfa Sci. & Tech. Advanced Materials Co. Ltd."Group"). The environmental key performance indicators (KPIs) mainly cover the Company and its subsidiaries in
China and the social KPIs mainly cover the Company and all its subsidiaries in China and overseas. Zhuhai Kingfa refers to Zhuhai Kingfa Biodegradable Materials Co. Ltd.Data Description Kingfa Carbon Fiber refers to Guangzhou Kingfa Caron Fiber Materials Dvpt. Co. Ltd.The data and cases cited in this report are derived from official documents and statistical reports of the Company Ningbo Kingfa refers to Ningbo Kingfa Advanced Materials Co. Ltd.and its subsidiaries. Unless otherwise stated the amounts shown in this report are in RMB.PP refers to Polypropylene
Reporting Principles
PE refers to Polyethylene
GRI Sustainability Reporting Standards (GRI Standards) the Global Sustainability Standards Board (GSSB)
ABS refers to Acrylonitrile-butadiene-styrene copolymer
Sustainable Accounting Standards Board Index (SASB Index)
PBAT refers to Poly (butyleneadipate-co-terephthalate)
The Sustainable Development Goals (SDGs) the United Nations (UN)
Corporate ESG Report Preparation Guide (CASS-ESG 5.0) the Chinese Academy of Social Sciences (CASS) PBS refers to Poly (butylene succinate)
PLA refers to
Disclosure Method Polylactic acid
PA refers to Polyamide
This report is available in our official website (https://www.kingfa.com.cn/) and the Shanghai stock exchange website
(http://www.sse.com.cn/) in electronic form. Both Chinese and English versions of this report are available for PA10T refers to
readers' reference. Polyamide10T
For any ambiguity or discrepancy due to language reasons the Chinese version Reporting Period refers to January 1 2022 to December 31 2022
shall prevail.
1 2Message from the Chairman Leading technological innovation to drive high-quality governance strictly adhering to business ethics and development in the industry. Research and innovation conducting operations in compliance with regulations.
(“R&D”)are Kingfa's core competitiveness. We We ceaselessly strengthened our risk management
establish the "13551" R&D system and an RDS (research capabilities and established a risk management center.development service) organizational structure gradually The comprehensive risk prevention mechanism we
forming an R&D platform driven by technology industry have established covers the entire process of risk
and product research. While constantly optimizing our management from beginning to end. At the same
customer service system we adhere to responsible time to effectively further the progress on our ESG
" marketing and strengthen our management of quality initiatives Kingfa has initiated the establishment of On the path to becoming an outstanding company control. In this way we provide clients with high-quality an ESG governance framework. We are improving
that develops advance materials Kingfa has products and high-standard services. To promote the the division of responsibilities and integrating ESG
undergone 30 years of challenges. The years optimization and upgrading of the entire industry chain principles more effectively into our strategic planning
have strengthened us with a solid foundation we fully leverage our role as a leading enterprise to to drive the company's high-quality development.and commitment to provide advance material shape a sustainable value chain. We establish platforms
products of superior quality as well better lives for industry cooperation and create new cooperation Adhering to the people-oriented principle for a
for all. Green recovery is gradually becoming a methods between industry research and academia. value sharing system.We value the personal rights
global consensus. Facing global challenges such and development of our employees. By continuously
as climate change pollution and economic Undertaking circular and low-carbon development i m p ro v i n g o u r c h e m i ca l s a fet y m a n a ge m e n t
inequality we now more than ever believe in for a greener and cleaner planet.Kingfa adheres system we aim to create a healthy and safe working
the importance of sustainable development and to green manufacturing to provide green products for environment. We also foster an inclusive and diverse
continuously explore the value it can provide for production and consumption for all. At the production corporate culture where everyone feels equal and
us. On this publishing of our first ESG report on and operational level we continuously increase our valued. Additionally we provide our employees with
behalf of Kingfa I would like to express my sincere investment in renewable energy and clean production. competitive compensation and benefits and offer
gratitude to all colleagues who have shown their We have also completed the annual assessment and ample opportunities for career development. As
concern and support for us. I cordially invite verification on greenhouse gas (“GHG”) emissions in a responsible corporation we see adding value to
you to explore our performance in sustainable Category 1 Category 2 and Category 3 for 10 legal entities society as the foundation of our business success.development through this report and engage encompassing the headquarter modified plastic sector We actively participate in philanthropic activities for
in a collective discussion on Kingfa's path of recycled plastic sector and medical and healthcare education poverty alleviation assistance to people
sustainability. sector within mainland China establishing a baseline with disabilities and disaster relief efforts. Since
for our carbon neutrality goals. We have proposed our establishment in 1993 Kingfa has cumulatively
" “Make the Best Use of Plastic” a comprehensive donated RMB 150 million for the betterment of society.solution to a circular economy for plastic. The solution
focuses on environmentally-friendly high-performance Moving forward Kingfa will leverage its ESG strategy
Kingfa always focuses on creating value through our dedication to provide products and services of superior quality recycled plastics and fully biodegradable plastics. It as a driving force for its sustainable development.creating a sustainable environment and better lives for all. We remain steadfast in our responsibility to create aims to address the issue of white pollution and provide We will explore new sources of growth and seize
sustainable value closely monitor key issues related to the environment society and corporate governance and innovative business models to support the low-carbon opportunities presented by the emerging generation. A
evaluate our sustainable development within the ESG framework. This gives us direction in fostering a responsible transformation of the chemical industry. journey of a thousand miles begins with a single step
corporate culture. and so does the journey to sustainable development.Strengthening the foundation for sustainable Kingfa will persistently move forward together with all
development based on excellent governance. In stakeholders to create a sustainable future for all.
2022 Kingfa continuously improved its corporate
Chairman of Kingfa
3 42022 Environmental Social and Governance Report
Kingfa at a Glance Corporate Culture
Kingfa Sci. & Tech. Co. Ltd. was established in 1993 headquartered in Guangzhou China. We focus on the research Vision Mission
development production sales and services of high-performance advanced materials and chemicals. We are
committed to providing innovative solutions to create a safer more comfortable and convenient life for everyone.After 30 years of continuous development Kingfa has experienced substantial growth. Currently we own 56 Becoming highly respected as the world's Growing together with our partners
subsidiaries and operate research and production bases in regions such as South Asia North America and Europe. In premier company for advanced materials sharing achievements and providing
2004 we were listed on the main board of the Shanghai Stock Exchange with the stock code 600143. high-quality advanced material products
for society to create a better life
As a global leader in the chemical advanced materials sector we
are committed to addressing the increasingly urgent environmental
challenges that humanity is facing. We strive to promote the
continuous improvement of the environment and achieve Key Achievement of 2022 Core Principle Market Philosophy
sustainable development. Kingfa focuses on the independent
innovation and development of our products. Our products Creating value Creating demands leading the market
cover eight major categories of proprietary intellectual property: Kingfa's ranking in the and serving clients
modified plastics environmentally-friendly high-performance
recycled plastic fully biodegradable plastics special engineering China's Fortune 500:
plastics carbon fiber and composite materials light hydrocarbons
and hydrogen energy styrene resins and medical and healthcare
polymer materials. With their excellent environmental friendliness 311th Employee Values R&D Philosophy
and outstanding performance our materials are exported to over
130 countries and regions worldwide. We proudly serve over 1000 Lo ya l t y re s p o n s i b i l i t y d i l i ge n ce Independent innovation technological
renowned global enterprises. innovation leadership excellent products
Kingfa's Headquarters in Guangzhou
5 62022 Environmental Social and Governance Report
Development 1993 1997 2001 2003 2004 2008
Milestones Kingfa Constructed a production Shanghai Kingfa Established a Kingfa listed on the main board of Acquired Mianyang Dongfang
established base in Guangzhou Sci. & Tech. Co. postdoctoral research the Shanghai Stock Exchange Special Engineering Plastics Co. Ltd.Tianhe District Ltd. is established workstation
Mianyang Changxin New Material
Development Co. Ltd. is established
Established an academician
workstation
2014201320102009
Wuhan Kingfa Sci. & Tech. Co. Ltd. is Acquired Kingfa Science & Technology Jiangsu Kingfa Sci. & Tech. Advanced Zhuhai Wantong Chemical Co. Ltd. is
established (India) Limited Materials Co. Ltd. is established established
Kingfa Global Innovation Training and Guangdong Kingfa Sci. & Tech. Co. Kingfa's sales revenue exceeds RMB 10 Tianjin Kingfa Advanced Materials Co. Ltd.Development Center is established Ltd. is established billion is established
2015201620172018
Kingfa Sci. & Tech. (USA) Inc. is established Kingfa Sci. & Tech. (Europe) GmbH is Obtained approval to establish the National Acquired Ningbo Wanhua Chemical Investment
established Advanced Polymer Materials Industry Co. Ltd.Chengdu Kingfa Sci. & Tech. Advanced Innovation Center
Materials Co. Ltd. is established Acquired Ningbo Yinshang Investment Co. Ltd.Kingfa Sci. & Tech. (Malaysia) Sdn Bhd is
established
2022202120202019
Liaoning Baolai New Materials Co. Liaoning Baolai New Materials Co. Ltd. is established Hainan Kingfa Sci. & Tech. Co. Ltd. is Acquired Ningbo Haiyue New Materials
Ltd. renamed to Liaoning Kingfa Sci. established Co. Ltd. and renamed it to Ningbo Kingfa
& Tech. Co. Ltd. Zhuhai Wantong Chemical Co. Ltd. renamed to Zhuhai Advanced Materials Co. Ltd.Kingfa Biodegradable Materials Co. Ltd.Kingfa Sci. & Tech. Japan Co. Ltd. is
established
7 82022 Environmental Social and Governance Report
Core Business Awards and Honors
The Global Supplier with the Most Complete Range of
Polymer Materials
Sales volume and/or sales of Kingfa's eight product lines in 2022
Modified Advanced Green Medical and
Plastic Materials Petrochemicals Healthcare
Sector Sector Sector Sector
Environmentally- Carbon Light Medical and
Fully Special
Modified friendly High- Fiber and Hydrocarbons Styrene Healthcare
Biodegradable Engineering
Plastics Performance Composite and Hydrogen Resins Polymer
Plastics Plastics
Recycled Plastics Materials Energy Materials
1573200 189000 98500 17800 RMB 459200 95600 RMB
tons tons tons tons 158000000 tons tons 1495000000
Global Footprint
local production tailor-made services nationwide coverage global reach
9 102022 Environmental Social and Governance Report
Participating in Domestic
Associations and Organizations
Association or Unit Role Association or Unit Role
China National Light Industry Council Vice President Guangdong Patent Information Association Member
China Plastic Processing Industry Association Vice Executive Member Guangdong Institute of Scientific and Technological Information Director
China Synthetic Resin Association Executive Member Guangdong Quality Association Director
China Synthetic Resin Distribution and Marketing Association ABS Resin Guangzhou Advanced Materials Industry Development Promotion Association President
Member
Chapter
Guangzhou Association of Science and Technology Innovation Vice President
China Association of Automobile Manufacturers Vice Director
Guangzhou Enterprise Federation Vice President
China Household Electrical Appliances Association Member
Guangzhou Chemical Industry Association Director
China Packaging Federation Vice President
Guangzhou Certification and Inspection Association Member
Competitive Intelligence Chapter of the Institute of Scientific and Technical
General Institutional Member
Information of China
Guangzhou Chemistry and chemical Association Vice Executive Member
Green Recycling Plastic Supply Chain Joint Working Group (GRPG) Member
Guangzhou Integration Between Industry and Education Association Vice President
Working Group on Standards for Pollution Control of Electrical and Electronic
Full Member
Products Ministry of Industry and Information Technology Guangzhou Industrial Design Association Vice President
Green Recycled Plastic Supply Chain Joint Working Group Member
Guangzhou Development Zone Intellectual Property Association Vice President
Guangdong Materials Research Society Vice Director Guangzhou Development Zone Chemical Industry Association President
Guangdong Circular Economy and Resource Comprehensive Utilization
Vice President Carbon Neutrality Working Group of the National Standardization Technical
Association DirectorCommittee on Plastic
Guangdong Light Industry Association Director Sub-committee on Modified Plastic of the National Standardization Technical Director
Committee on Plastic
Guangdong Mechanical Engineering Society Standing Executive Member China Association for Public Companies Director
Guangdong Plastics Industry Association President Guangdong Listed Companies Association Member
11 122022 Environmental Social and Governance Report
Our ESG Approach
We believe the key to creating long-term value lies in the sustainable development of our company. Kingfa
focuses on the effectiveness and integrity of our ESG system. Based on our own inherent ESG principles and
global strategy we have established a top-down ESG governance framework and continuously strengthen
communication on ESG issues with stakeholders. Through analyzing material ESG issues we align our
actions with the United Nations Sustainable Development Goals (SDGs) to identify key directions for our ESG
development. In this way we continuously improve our ESG initiatives and enhance our ESG performance.ESG Governance Framework
To effectively carry out ESG work Kingfa has established a clear and hierarchical four-level ESG governance
framework based on its existing corporate governance structure and strategic development needs. This framework
ensures clear roles and responsibilities and facilitates the implementation of top-down ESG management work.Each level has clear and coordinated responsibilities that together enhance Kingfa's performance in sustainable
development to create value for the economy environment and society.Highest level of The Board of Directors carries the highest level of responsibility and is fully in charge of
Board of Directors responsibility Kingfa's ESG strategy management and external disclosure.In addition to their existing responsibilities the Strategy and Sustainable Development
Strategy and Sustainable Committee is responsible for ESG decision-making introducing ESG concepts into Kingfa's
Development Committee Decision-making overall strategic planning and recommending ESG decisions to the Board of Directors.level
Supervision Reporting The ESG work group operates under the Strategy and Sustainable Development Committee.It is responsible for daily implementation of ESG policies. The ESG work group is made up of
ESG work group Management Kingfa's senior management staff and the directors and executives of functional departments
level related to ESG. The ESG work group supervises and manages the implementation of ESG
Supervision Reporting work by key functional groups. It carries out the ESG strategy and specific measures and
periodically reports to the Strategic and Sustainable Development Committee.Functional departments
related to ESG Executive The executive level is made up of all functional departments and subsidiaries related to
level Kingfa's ESG which actively implement specific ESG tasks that fall within the scope of
their duties during the course of daily operations and push to achieve key ESG metrics
and goals under the direction of the ESG work group.
1314
China Polymer
Materials
Subsidiary ESG
Coordinator
Information
Center
Legal and audit
Department
Human Resources
Department
Sustainable Development &
Public Affair Department
Project
Department
Securities
Department
Processing Equipment
Department
Standardization
Office(Quality Management
Department )
Office
Supply Chain Center
(Purchasing Department)
Technology Center
Marketing Center2022 Environmental Social and Governance Report
Stakeholder Communication
Kingfa understands that our sustainable development relies on the support of all stakeholders. We highly value
communication with stakeholders and actively engage in dialogue with them. Through diverse communication Stakeholder Concerns and Expectations Communication Channel
channels we aim to gain a deep understanding of stakeholders' expectations and demands. Feedback from
stakeholders is essential for us. We incorporate their concerns and suggestions regarding ESG issues into our
E nsuring the basic rights of Regular work meetingsdecision-making process. This in turn is reflected in our sustainable actions.employees
Suggestion boxes
Stakeholder Concerns and Expectations Communication Channel Well-established career development Email and enterprise WeChat
system communication
Responding to national development Employees Pa r t i c i p a t i n g i n g o v e r n m e n t G ood welfare benefits Employee engagement surveys
strategies cooperation projects exchanges H ealthy and safe work environment
and seminars Labor union Compliance operations
Government Risk management A ctively cooperating with regulatory
and regulatory authorities Transparent information disclosure
institutions
Promoting industrial development Daily work reporting Fair procurement Supplier conference
Supplier support and empowerment Regular communicat ion with a
Supplier Building a sustainable supply chain
dedicated contact
Corporate governance Information disclosure
Compliance operations Shareholder meetings
Risk management Performance briefing
Shareholder/ Stable investment returns
Investor Communication through phone and Charitable donations
Transparent information disclosure email
Driving regional economic Public welfare activities
development and promoting
Community and employment Promotion on social media platforms
non-governmental
Product quality and safety organizations Environmental protection
Technology R&D and innovation Product demand research
I nformation security and privacy Customer satisfaction surveys
Client protection Complaint handling mechanism
I nformation disclosure and
Business ethics Communication with spokespersondissemination
The Media
15 162022 Environmental Social and Governance Report
Materiality Assessment The matrix of material issues provides an important reference for us to progressively carry out various
ESG initiatives.Based on our sustainable development strategy and considering the concerns and expectations of both internal
and external stakeholders Kingfa identified 23 material ESG issues. This identification process involved referencing 5
domestic and international standards macro policies industry development trends and other factors. 7 10
13
49
Our workflow for identifying and analyzing material issues was as follows: 20
22 21 Environment topics
82
19
13 Very
Researched industry macro policies and development trends to determine the direction. 11 important
Society topics
Referred to mainstream ESG disclosure guidelines and rating standards both domestically
Step 1 and internationally and compiled a list of issues. 6 12 15
Issue Benchmarked against the excellent practices of domestic and international peers and 16 Relatively
Governance topics
important
identifying further refined the list of issues based on our business characteristics and development 14
strategy which led to identifying 23 material ESG issues. 18
17 Moderately important 23
High Internal importance to Kingfa Very high
Conducted surveys such as interviews and questionnaires with internal and external
Step 2 stakeholders to assess the importance of the identified issues. E Environment
Sorted and categorized the issues based on the survey results considering both internal 1 Climate change action 2 Energy management 3 Water management 4 Waste management
Stakeholder and external dimensions of importance.surveying 5 Circular economy 6 Biodiversity & environmental protection 7 Green products
S Society
8 Product quality and safety 9 Technological innovation 10 Chemical safety
11 Responsible supply chain 12 Responsible business & marketing 13 Employment & employee rights
Step 3 Created a matrix of material issues reflecting their importance to internal and external 14 Employee development & training 15 Occupational health & safety 16 Equality inclusivity diversity
stakeholders.Creating The ESG working group reviewed and discussed the results of the material issue analysis 17 Societal development & charity 18 Contribution to industry development 19 Data security
the matrix and ultimately confirmed the matrix of material issues.of material G Governance
issues
20 Compliance operations 21 Risk management 22 Business ethics 23 Transparent disclosure
1718
Very high Importance to external stakeholders High2022 Environmental Social and Governance Report
Contributing to the UN SDGs Overview of ESG Highlights in 2022
The United Nations 2030 Agenda for Sustainable Development outlines 17 SDGs that provide a roadmap for
promoting human well-being and sustainable development. These goals also serve as a strategic framework
for businesses to explore sustainable practices. In 2022 we assessed Kingfa's response and contributions to Environmental
the SDGs from three dimensions: the planet plastics and people. In the future we will further integrate the
SDGs into our sustainable development practices and aim to help achieve global sustainable development Inventory and verification of GHG for Category 1 Category 2 and Category 3
goals through concrete actions. (applied standard: ISO 14064 - 1:2008): 401844.28 tons of carbon dioxide equivalent (tCO2e)
Sales of environmentally-friendly National green factories: Total annual investment in
high-performance recycled 4 environmental protection: RMB
plastics: 189000 in totaltons 56402300
Features:
Make the Energy savings in the modified plastic sector: Roof photovoltaic power generation:
Best Use of
Leading Plastic for 1197.77 tons of standard coal 11.37 million kilowatt-hours
Innovation a Greener
Creating a Future
Global Brand
Social
Safety Coming
First as the Solid c The first Chinese company in the plastic industry joined the New Plastics Economy Global Commitment initiative
Foundation for ast
i
l
Development
Kingfa's R&D investment in the past three years: Cumulative patent Patents granted in Protecting the
Environment for contribution
a Greener Future RMB 4347878400 applications: 5401 2022: 514
to SDGs
Together
Cumulative donations to society
People-Oriented for Investment in safe production: Employee social insurance since establishment: over RMB
Better Lives
RMB 78279200 coverage rate: 100% 150 million
Forging
Partnerships Building
to Facilitate Sustainable Governance and Economy
Industry Growth An ESG function added to the strategic committee with the establishment of an ESG working group
Flourishing Through
Ethical
Operations Completion rate of Revenue in 2022: Net profit attributable to shareholders
internal audit rectification: of the listed company in 2022:
91% RMB 40412 million RMB 1992 million
1920
Humanity
P
Earth2022 Environmental Social and Governance Report
Features: Make the Best Use of Plastic
for a Greener Future
As a leading company in the advanced materials industry Kingfa always aspires to create a better world and Low-Carbon Journey
is committed to achieving the perfect balance between the planet plastics and people. Only by continuously
researching and developing high-performance plastic products can we contribute to a convenient and better life for As a responsible advanced materials company Kingfa has always adhered to the concept of sustainability and
humanity. By fully embracing low-carbon and environmentally-friendly business models for both the production and actively promotes green and low-carbon production. We are committed to researching and developing products
disposal of plastics we can ensure our planet remains green and full of vitality. that are environmentally-friendly.We have closely linked sustainable development with business growth and are working together to build a green Kingfa's Low-Carbon Journey
low-carbon and circular advanced materials business system. We are focusing on two emerging areas namely Started exploring a circular economy for plastic and laid out the foundation for environmentally-
recycled plastics and bioplastics. We have proposed a comprehensive solution to a circular economy for plastic 2004 friendly high-performance recycled plastics and fully biodegradable plastics sectors
called “Make the Best Use of Plastic” which promotes the green and low-carbon transformation of the chemical
industry and leads the way in reducing plastic wastes in society.
2011 Obtained certification for complete biodegradation and the Green Ten-Ring Certification
Contributing to the UN SDGs
2012 Obtained the Guangdong Province Clean Production Certification
2014 Established an energy management system implemented a carbon asset management module
and began operation of the photovoltaic power generation project at the Guangzhou headquarters
Key Achievements of 2022 2017 Recognized as one of the first batch of national demonstration enterprises for green factories in the plastic industry
Inventory and verification of GHG for Category 1 Category 2 and Category 3 (applied standard: ISO 14064 - 2019 Launched a pilot project for intelligent manufacturing at the Qingyuan base
1:2008): 401844.28 tons of carbon dioxide equivalent (tCO2e)
2021 Ranked first on the 2020 Southern Weekend China Corporate Social Responsibility Low-Carbon
Waste plastic recycled: approximately 200000 tons Transformation List
Sales of environmentally-friendly high-performance recycled plastics: 189000 tons 2022 Awarded the 2022 Golden Key - China Action for SDGs
Production of bio-based special engineering plastics : approximately 9100 tons Carbon Neutrality Goals
Since the national dual goals of peaking carbon dioxide
before 2030 and achieving carbon neutrality before
Moving towards Carbon Neutrality 2060 of China was proposed in 2020 the growth of
low-carbon economy is turning into a new path of
high-quality development in China. In response to the
The Global Risks Report 2023 released by the World Economic Forum identifies climate change as the most serious
above goals on October 16 2021 Kingfa announced
long-term risk globally. In recent years climate change has intensified leading to more frequent extreme weather
its carbon strategy and goals at the China High-level
events which seriously threaten the sustainable development of human beings and the inherent balance of the
Carbon Forum for The Plastic Value Chain as the first
planet's ecosystem. Actively coping with climate change and pursuing a path of green low-carbon development has
Chinese company in the plastic industry to launch its
become an urgent and common issue for all mankind.carbon goals to the public. Plastic Industry Carbon Peak Forum China
21 22Kingfa's Carbon Goals Version 1.0 Enhance the green supply chain management system
(updated and upgraded every two years)
R egularly conduct dual-carbon assessments gradually extending
coverage from core suppliers to all suppliers
Reducing greenhouse gas (GHG) emissions per product unit by 30% before 2030 compared to 2022 Upstream
Management Regularly conduct dual-carbon training to provide theoretical
In 2030 producing 1 million tons of green plastics (including fully biodegradable plastics and bio-based guidance and practical implementation tools for suppliers
materials) recycling 1 million tons of plastic wastes and producing 1 million tons of environmentally-
friendly high-performance recycled plastics
Achieving corporate carbon neutrality before 2060 Improve the carbon management leading group and execution
framework within Kingfa and its subsidiaries
D evelop and implement annual decarbonization plans and
Note: The goals will be dynamically updated every two years based on our decarbonization progress. continuously assess and update annual targets and long-term
goals
Production
According to the verification of the independent third-party agency TüV Rheinland Kingfa’s GHG inventory C onduct annual greenhouse gas emission assessments and
covers a total of ten legal entities in the modified plastic recycled plastic and medical and healthcare sectors & Operation disclose our decarbonization progress
along its headquarter in China. During the Reporting Period in Year of 2022 the total GHG emissions amounted A ccelerate the implementation of smart manufacturing increase
to 401844.28 tCO2e.Direct greenhouse gas emissions (Category 11 ) amounted to 37085.07 tCO2e accounting for the proportion of renewable energy use and create green factories
9.2% of the total emissions while indirect greenhouse gas emissions amounted to 364759.21 tCO2e accounting
for 90.8% of the total emissions. Among the indirect emissions Category 22 accounted for 82.3% and Category
33 accounted for 8.5%.
C ooperate with downstream clients in implementing low-carbon
management requirements for suppliers
Category 1: Direct greenhouse gas emissions including fuel combustion of fixed equipment required for production
fuel combustion of transport vehicles raw and auxiliary materials manufacturing process refrigeration Research and develop low-carbon products based on client
equipment and plant septic tank escape and other activities within the scope of business. Downstream demand
Collaboration
Establish industry databases and databases for calculating the
Category 2: I ndirect GHG emissions from input energ y including electr ic ity and steam provided outside the footprint of plastic products
boundaries of the organization.Category 3: I ndirect greenhouse gas emissions from transportation including upstream and downstream cargo
transportation employee commuting business travel customer transportation etc. A Circular Economy for Plastic
Plastic as an important and basic materialwith light weight low price and strong plasticity has been widely used
in many aspects of the economy and society. While bringing many conveniences to people's daily life it also brings
huge environmental challenges. To date cumulative global plastic waste has exceeded 7 billion tons with only
Carbon Neutrality Actions around 9% of plastic waste being recycled. Countless tons of plastic waste are either incinerated landfilled or
disposed through other inappropriate methods. In an effort to help solve plastic pollution Kingfa has proposed
To achieve the above goals Kingfa has initiated green low-carbon and circular transition actions and formulated the circular economy plan "Maximizing the Use of Plastics." The plan focuses on key stages throughout the entire
practical strategic action plans for each goal. We will collaborate with upstream and downstream companies across lifecycle of plastic with a particular emphasis on recycled plastic and bioplastics. Through these two approaches
the entire plastics industry chain to take collective action: Kingfa aims to provide innovative ideas and solutions for global plastic reduction.
23 24Make the Best Use of Plastic Recycling
– Kingfa’s Solution to A Circular Economy for Plastic Kingfa has established a comprehensive plastic waste recycling system that covers the industrial
agricultural household and maritime sectors among others.Harmless Clean & We have developed over 500 high-quality suppliers specifically targeting different segments of recycling
processing crush channels. With over 60 resource recycling centers we are continuously enhancing our front-end recycling
capabilities.Odor & impurity
Sort We collaborate with large-scale dismantling plants and recycling facilities in China enabling the direct
removal processing of waste materials in their premises. This partnership significantly shortens the recycling chain
and reduces overall recycling costs.Recycled Modified
plastic Recyclegranulation
Pre-Processing
Reuse Kingfa owns two major pre-processing bases in Pizhou and Qingyuan. In 2022 our capacity for the high-
quality treatment of waste plastics reached 130000 tons.Petrochemical Petrochemical plastic Landfill
raw material production We continuously improve our R&D for core technologies and equipment making significant progress
Finished product
Consumption Incineration in areas such as intelligent identification automatic sorting and chemical impurity removal. These
Manufacturing
Bio-based raw Bioplastic advancements improve recycling efficiency and reduce resource waste.Leakage into
materials production environment Kingfa has developed customized pre-processing equipment and production lines tailored to different
Reuse categories of waste plastics and developed environmentally-friendly cleaning agents and solvents for
specific types of pollutants. We continuously optimize high-efficiency cleaning techniques and secondary
pollutant control technologies to minimize process pollution.Bioplastic Compost
Refined Regeneration
By changing the combination of screws in the extruder and employing melt filtration we enhance the
Turning Wastes into Resources appearance of recycled plastic pellets.Combining negative pressure water injection steam blowing and infrared heating we effectively
We firmly believe that plastic waste is a valuable resource placed in the wrong location. Kingfa began laying the
groundwork in the field of environmentally-friendly high-performance recycled plastics in 2004. We established a reduce the odor of recycled plastics.sustainable development technology research institute and increased our research efforts for general technologies
of environmentally-friendly high-performance recycled plastics. In 2013 we established the Sustainable Products
Department which later developed into a subsidiary called Kingfa Environmental Protection in 2021. This subsidiary High-quality Utilization
specializes in the research production and sales of environmentally-friendly high-performance recycled plastics.We analyze the physical visual structural and aging properties of recycled plastics as well as their
Kingfa tackles various aspects such as recycling pre-processing refined regeneration and high-quality use to impurities. Based on the defects found in waste materials we modify our processes to improve their
systematically address the challenges the recycled plastics industry faces in terms of technology equipment and performance. Through researching formulations antioxidants and impurity influences along with extrusion
environment. We provide theoretical and technical support for the efficient use of waste plastic resources. blending processes we enhance the mechanical and aging properties of recycled plastics. This allows us to
produce high-quality modified plastics that can fully or partially substitute for advanced materials.
2526
Two major starting pointsKingfa has obtained several certifications in the field
of recycled plastics.These include the world’s first Coal Use Reduction CO2 Emission Reduction Electricity Reduction
TüV Rheinland Ocean-Bound Plastic (OBP) Recycled
Content Validation certificate UL 2809 certification 2.38 million tons 2.16 million tons 7900 million
and the Global Recycled Standard (GRS) certification. kilowatt-hours
These certifications validate our commitment to using
recycled plastics and adhering to global standards Petroleum Use Reduction Water Use Reduction
in sustainable recycling practices. As of December
31 2022 Kingfa had obtained 72 OBP Recycled
Content Validation certificates104 certificates for 8740000 tons 113340000 tons
recycled plastic content after consumption and 9 Kingfa's OBP Recycled Content Validation Certificate
certificates for chemical recycled plastic content. Awarding Ceremony
Kingfa has provided products and services to over
1000 internationally renowned companies in more plastic products have been widely applied in industries Case Study on Product Carbon Footprint Reduction
than 130 countries and regions worldwide. Our such as packaging automotive household appliances IT via Kingfa’s Environmentally-Friendly High-Performance Recycled Plasticsv
environmentally-friendly high-performance recycled electronics and energy.Reduction in
Kingfa's Environmentally-Friendly High-Performance Recycled Plastics Carbon Footprint
Object of study Unit (Relative to Virgin Software Database
– Upstream Feedstock and Downstream Application Scenarios HDPE Material)
%
Diversified feedstock Diversified applications
CLCD-China-
ECER 0.8
Virgin HDPE 1 ton of modified Ecoinvent
Urban Industry ≥ 65 eFootprintmodified plastic plastic pellets 3.5
waste waste Kingfa eco-friendly GGCdatabase
recycled plastic 1.1
plant
Information source: The case of the Carbon footprint calculation project for the whole life cycle of polymer products of China National
Marine Agriculture Polymer Materials Industry Innovation Center Co. Ltd. - detergent bottles in the daily chemical industry as an example.Waste waste
?500+ optimum suppliers Innovative Alternatives
?60+ recycling networks ?Serving over 1000 renowned international enterprises
In addition to our continuous efforts in the field of recycled plastics we are actively exploring the use of bioplastics
?Used in 7 major industries
as alternatives to traditional single-use plastic products and as a complement to recycled plastics. Kingfa's research
and industrialization of fully biodegradable plastics began in 2004. After nearly 20 years of exploration we have
developed into a leading global enterprise as well as the only Asian enterprise that has fully mastered the core
Kingfa innovates environmentally-friendly high-performance plastic recycling technology which not only helps technologies of polymerization modification and end-use applications of fully biodegradable plastics. Currently we
address white pollution but also significantly reduces energy consumption and GHG emissions in contrast to virgin have an annual production capacity of 180000 tons of PBAT and PBS resin and 30000 tons of PLA.materials. From 2004 to 2022 Kingfa has cumulatively provided over 1.7 million tons of environmentally-friendly
high-performance recycled plastics to the global market. This contribution has played a significant role in mitigating
climate change protecting the environment and preserving biodiversity.
2728
Source of energy
Cars
Clothing
Package
Furniture
Electronic appliance
Architecture"What are Bioplastics? Kingfa's fully biodegradable materialsBioplastics are plastics that are produced using non-food-based biomaterials as raw materials. They are
also bio-based plastics that can completely degrade into harmless substances within a short period of time
under natural or composting conditions thereby replenishing the ecosystem. Fully biodegradable plastics
are currently regarded globally as a powerful tool for addressing plastic pollution particularly in tackling
the pollution caused by disposable plastic waste such as straws food containers and packaging bags.ket Ar gra icm g m u
pin u
Kingfa's ECOPOND fully biodegradable plastics can be completely decomposed by microorganisms and enzymes
into water carbon dioxide and organic matter within a few weeks under industrial composting conditions. No toxic
or harmful residues remain after decomposition.ECOPOND products comply with numerous internationally
recognized biodegradation standards
TüV Austria OK compost - TüV Austria OK
INDUSTRIAL compost - HOME
High-Temperature Nylon Derived from Castor Oil
Starting in 2006 Kingfa began R&D on high-temperature
resistant polyamide (high-temperature nylon) materials.European standard EN 13432 Germany's TüV Rheinland DIN North American After years of technological breakthroughs we successfully
Australian standard AS 4736 CERTCO - DIN Industrial BPI standard overcame issues related to formulation processes and
equipment. As a result we developed a bio-based PA10T with
unique performance advantages and established a large-scale
industrial production facility with an annual capacity of tens
Kingfa has developed products for various applications including film blowing extrusion injection molding and film of thousands of tons. Compared to foreign high-temperature
casting. These products encompass PBAT PBS PLA resins and related modified materials. Among them we have resistant polyamides PA10T has the advantage of using
launched PBS resins that meet food contact requirements thereby promoting the transformation of materials for decanediamine derived from castor oil as its raw material.This helps reduce petroleum consumption and makes PA10T Castor oilproducts such as straws. We have become a global leader in terms of the most extensive product lines of bioplastics.Our products are widely used in applications such as disposable packaging food utensils agricultural mulch films an environmentally-friendly and low-carbon material. PA10T Kingfa is the only company in China that can
and 3D-printed consumables. The quality of Kingfa's fully biodegradable plastics has reached internationally demonstrates superior overall performance and has been mass produce PA10T and in 2022 our product
advanced levels. We have been granted 44 domestic invention patents and 20 utility model patents as well as 147 widely applied in various fields such as LEDs electronics sales accounted for 90.8% of the market share
foreign invention patents and 12 utility model patents. Our PCT international patents cover Europe the United automotive renewable energy telecommunications in China's bio-based high-temperature nylon
States Japan South Korea and Australia. household appliances and rail transportation. Currently market.
2930
Sus pe
es e serc ho
r
m p
abl
e Ex
s are e-co
p
m rw
"
r a l Dis
lt u tab
p
ch l
o
l eValue Chain Collaboration Setting a Green Benchmark in the Packaging Industry
While plastic packaging makes our lives more convenient it also increases plastic pollution. Increasing the use of
Achieving dual-carbon goals and building a circular economy for plastics is a systemic project that post-consumer recycled (PCR) plastic has become the primary measure for major brands worldwide to address the
requires collaboration from all of society rather than being achievable by individual companies alone. issue of plastic packaging pollution. Kingfa employs internationally leading plastic recycling technology to safely
In 2022 Kingfa joined the New Plastics Economy Global Commitment initiated by the United Nations recycle and process waste packaging providing environmentally-friendly high-performance recycled materials to
Environment Program and the Ellen MacArthur Foundation. We are the first Chinese company in the packaging factories for the production of new packaging. These materials then circulate back to consumers through
plastic industr y to join the initiative. Kingfa will work together with industr y partners to promote the market enabling a closed-loop model for plastic packaging.the development of a circular economy for plastics accelerate the low-carbon transformation of the
economy and society and jointly safeguard our green planet.Leading Standardization
The standardized operation and healthy development of the industry rely on the guidance of high-quality
standards. Since its establishment Kingfa has actively participated in the formulation of national industry
and association standards in the fields of polymer materials modified plastics recycled plastics bio-based
materials and more. We have been involved in formulating over 130 standards contributing to the healthy
development of the plastics industry.As a core member of the National Technical Committee on Plastics of Standardization Administration of
China (TC15) and the Secretariat of the Sub-Technical Committee on Modified Plastics (TC15/SC10) Kingfa
has taken the lead in formulating national standards for recycled plastics. This includes GB/T 40006.1-2021 - Event for the Establishment of the Sustainable Plastic
Part 1: General Principles and GB/T 40006.8-2021 - Part 8: Polyamide (PA). These standards define the scope Packaging Joint Innovation Center
and performance criteria of recycled plastics from a material perspective.As a strategic partner in Unilever's sustainable development strategy Kingfa has developed an environmentally-
Moreover to promote the use of high-quality recycled plastics in downstream applications Kingfa has taken friendly high-performance recycled plastic HDPE (High-Density Polyethylene) for it. Our process for recycling HDPE
the lead in collaborating with leading enterprises from various industries to develop specific standards for is simple and yields products with low odor and minimal black spots while maintaining comparable physical
recycled plastics in their industries. For example in collaboration with Lenovo Kingfa has co-initiated the properties to products made with virgin materials.development of the association standard "Guidelines for the Evaluation of Recycled Plastics in Electrical
and Electronic Products". Additionally in collaboration with China Automotive Data Co. Ltd. Kingfa has In 2021 Kingfa's project of "Green Circularity and High-Quality Use of Disposable Takeout Food Containers" was selected
co-initiated the development of a series of standards on "Specifications for the Use of Recycled Plastics in as a demonstration project by Meituan Green Tech an environmental technology innovation fund initiated by Meituan a
Automotive Applications". These standards are expected to be officially published in 2023-2024. leading food delivery platform in China. The project focuses on the recycling and use of discarded plastic food containers
and aims to integrate and optimize the entire industry chain. It has become the first demonstration line in China with the
capacity to recycle and regenerate plastic food containers by the tens of thousands of tons.To facilitate the industry's measurement of the contribution of the plastic circular economy to carbon
emission reduction we have collaborated with the China National Resources Recycling Association
to develop a calculation methodology. Under the guidance of the National Development and Reform In 2022 Kingfa together with the Guangzhou Customs Technology Center Jinan University and Southern Packaging
Co. Ltd. established the Sustainable Plastic Packaging Joint Innovation Center. The center aims to unite the industry
Commission we have formulated and released the first domestic standard for calculating the carbon
academia and research forces to "promote sustainable innovation and development in the plastic packaging
emissions of recycled plastics titled "Recycled Plastics - Calculation of Carbon Emission from Physical industry." It is dedicated to researching and industrializing innovative technologies for sustainable plastic packaging
Recovery". This standard was officially implemented on December 28 2022 complementing existing promoting industry standardization addressing technological bottlenecks in the industry and jointly creating a new
standards. era of sustainable development in the plastic packaging industry.
31 32Empowering the Automotive Industry for a Low-Carbon Future Creating Diversified Applications in the IT and Electronics Industry
In the face of the growing global trend towards green low-carbon and circular development in the automotive The 14th Five-Year Plan for the Development of A Circular Economy has clearly outlined key actions such as the
industry the use of recycled plastics has become an increasingly popular choice among major car manufacturers recycling and use of waste electrical and electronic products and the recycling of used batteries. The IT and
worldwide. electronics industry is on the verge of transition towards sustainability.Kingfa and Lenovo have joined hands to expand the plastic circular economy into the production of electronic
consumer goods. We are collaborating to research and develop environmentally-friendly advanced materials thereby
introducing recycled plastics into the production lines of high-end manufacturing industries. As early as 2007 Kingfa
PCR materials were already used in Lenovo's relevant electronic products. Subsequently through technological
innovation we continuously developed PCR materials with high incorporation ratios applying them to a wider range
of products. In the future Kingfa will continue to collaborate with Lenovo to enter the field of marine plastic waste
collection and recycling. Following the principles of ecological design and full product lifecycle assessment we will
jointly develop new products that meet carbon neutrality standards. We aim to lead the application of solutions for
plastic recycling and reuse in the global electronics industry.Accelerating the High-Quality Development of the Home Appliances
and Household Industry
The Implementation Plan of the Extended Producer Responsibility Scheme of China specifies that by 2025 the
proportion of recycled materials used in key products should reach 20% and the average standardized recycling and
utilization rate of waste products should reach 50%. The trend towards environmentally-friendly and lightweight
household appliances continues to drive the research and application of recycled materials.The environmentally-friendly high-performance recycled materials developed by Kingfa have been widely applied
by domestic and international household appliance brands in products such as televisions refrigerators air
conditioners humidifiers lamps hair dryers and more. As the strategic partner on sustainability for the world-
leading household products brand owner Kingfa has constructed the Meijin Factory a factory that is tailor-made
to this client for recycled materials. This factory supports this brandowner’s commitment to using renewable or
recyclable materials in all its products by 2030.Forum of Application Technology of Recycled Plastic Used in Vehicles for Dual Carbon Goals
Kingfa has successfully mastered key technologies to produce plastics with low VOC (volatile organic compounds)
low odor excellent appearance and aging resistance which makes them ideal for replacing steel. Our typical
recycled materials for automotive use have been recognized by numerous global automotive OEMs and are widely
used for manufacturing key automotive components. In this way we are leading the trend of low-carbon and circular
materials in the automotive industry.On June 10 2022 Kingfa in collaboration with the China Automotive Data Co. Ltd. Under the China Automotive
Technology and Research Center (CATARC) successfully held the Forum of Application Technology of Recycled
Plastic Used in Vehicles for Dual Carbon Goals.This forum marked the beginning of a new chapter in collaboration
between upstream and downstream sectors of the automotive industry in the field of recycled materials.
333401
Leading Innovation
Creating a Global Brand
With a mission to achieve a gross output of RMB 100 billion Kingfa always takes innovation as the core
driving force for its business. We vigorously develop new products enhance product competitiveness
solidify product quality and improve customer management in order to become a global leader in the
chemical and advanced materials industry.Key Achievements of 2022
R&D investment in the past three years:
RMB 4347878400
Cumulative patent applications: 5401
Patents granted in 2022: 514
Contributing to the UN SDGs2022 Environmental Social and Governance Report
Independent R&D and R&D Platform
Inclusive Innovation Kingfa has established a focused "13551" R&D system and built an RDS (research development and service) organizational structure gradually forming an R&D platform driven by technology industry and product
research. To address common technical challenges across different modules Kingfa has established a
technology research institute. With projects being the main focus the institute systematically addresses
The vision of becoming widely respected as the world's premier advanced materials company motivates every common key technical issues across various products aiming to enhance research efficiency.member of Kingfa to passionately lead the high-quality development of the advanced materials industry through
innovation-driven approaches. Kingfa actively seizes the opportunities brought by technological revolution and "13551" R&D System
industrial transformation. Through innovative and independent R&D we have tackled many challenges related to
materials in the emerging industry driving the industry toward sustainability and technological advancement.R&D Capability
Kingfa conducts R&D by focusing on independent innovation technological leadership and excellent products.We rely on four national-level technological R&D platforms including the National Enterprise Technology Center 1 3 5 5 1
National Engineering Laboratory National Key Laboratory and National Industrial Innovation Center as well as 22
provincial-level R&D centers. We continue to accumulate technical expertise and conduct product research in the
fields of modified plastics environmentally-friendly high-performance recycled plastics fully biodegradable plastics Central Research International Sub-Technology Chemical New National Industrial
special engineering plastics carbon fiber and composite materials light hydrocarbons and hydrogen energy Institute R&D center Center Material Incubation Innovation Center
styrene resins and medical and healthcare polymer materials. In addition Kingfa sees the trend of low-carbon Base
transformation in the chemical industry. We have proactively positioned ourselves by incorporating the development
of clean and low-carbon technologies into our core R&D strategy.Modified Plastic Sector Advanced Materials Sector Technology Product
Research R D R&D
Materials research for smart home appliances Focusing on high-efficiency and low-carbon
new energy vehicles photovoltaic (PV) energy industries expand the types of bio-based and R&D
storage etc. biodegradable materials Platform
RDS
Green Petrochemicals Sector Medical and Healthcare Sector
Focusing on high-efficiency light hydrocarbon Focusing on the development and production S
materials explore low-carbon and low-cost of medical and healthcare protection products
segmentation products covering professional medical industrial Service Application
civil life three major fields
RDS Organizational Structure
37 382022 Environmental Social and Governance Report
Kingfa National Certified R&D Institutions Collaborative Innovation
R&D Institution Certification Time Certification Authority
We have built an innovative ecosystem of collaboration by cooperating with prestigious universities and research
National Advanced Polymer National Development and institutions such as Zhejiang University Sichuan University and the Institute of Chemistry under Chinese Academy
2016
Materials Industry Innovation Center Reform Commission of Sciences to carry out national key R&D programs contributing to the development and innovation of the industry.Recent Collaborations in Research and Innovation
National Key Laboratory for Efficient
Ministry of Science and
Development and High Utilization of 2015 (Selected National Key R&D Programs)
Technology
Waste Plastics Resources
Year Project Name Collaborating Unita Focus
National Engineering Laboratory for
2008 National Development and
Plastic Modification and Processing Reform Commission Technology and Demonstration of Green South China University
Circularity and High-Quality Utilization of of Technology Fujian Solid Waste
2019
CNAS Accredited Laboratory 2006 China National Accreditation Service
Waste Mixed Plastic Packaging Based on Normal University Sichuan Resource Utilization
for Conformity Assessment (CNAS) a Structure-Function Relationship University
National Enterprise National Development and Reform Research on Quality Systems of Generic Generic Technology Research 2004 National Institute of
Technology Center Commission 2019 Technologies for High-Quality Circulation and Application for National Metrology of China
of Waste Plastics from Daily Sources Quality Infrastructure of China
Postdoctoral Research
2003 National Postdoctoral Management
Workstation Committee South China University of Intelligent Decision-Making and Control Collaborative Manufacturing
Technology Huazhong
2019 Technology for Polymer Product Mixed and Intelligent Factory via
University of Science and
R&D Capacity Manufacturing Production Lines NetworksTechnology
To strengthen our industry research capabilities we have established an industry research department. Demonstration and Application of
With a focus on common key technologies in the industry we closely follow industry developments Cycloolefin Copolymer Materials and Advanced Functional and
and cutting-edge technological applications to provide industr y customers with professional and 2021 Zhejiang UniversityTheir Key Monomer Norbornylene for Intelligent Materials
comprehensive solutions. In addition we have established a product R&D department which operates Pharmaceutical Packaging
based on product categories and material applications. We conduct customized product R&D to provide
our customers with competitive products based on their requirements. By the end of 2022 Kingfa had Demonstration and Application of Ultra-
assembled a talented team consisting of 1 foreign academician 5 experts who receive special government Advanced Functional and 2021 High Melt Flow Polypropylene (PP) Resins Sichuan University
allowances from the State Council 15 leading academicians 157 senior experts from overseas 138 senior Intelligent Materialsfor Medical Protective Use
and associate engineers and more than one hundred doctors.Technology and Engineering
Key Technologies and
Key Achievements of 2022 Demonstration of Recycled Film South China University of 2022 Equipment for a Circular
Stretching Reconstructed Packaging Technology
Economy
Materials
Employees in our R&D team: 1183
Technology and Engineering
Key Technologies and
Including employees with Ph.D. degree: 105 Demonstration of Non-Sorting Huazhong University of 2022 Equipment for a Circular
Regenerated Geomembranes from Waste Science and Technology
And employees with master's degree: 302 EconomyFood Packaging Films
39 402022 Environmental Social and Governance Report
R&D Accomplishments Striving for Excellence Quality and Branding
Kingfa adopts an aggressive R&D strategy always guided by market demand. We focus on breakthroughs
in generic key technologies based on industry needs and applications. Since its establishment we have
achieved fruitful results in technological innovation through our leading R&D capabilities earning wide Kingfa highly values product quality and actively responds to the national strategy of high-quality development.recognition and praise from the market and users. We consistently prioritize customer satisfaction and strive to become a globally respected leader in the advanced
materials industry. Our philosophy regarding quality revolves around establishing ourselves through standards
gaining strength from quality and prioritizing customers. We implement standardized PDCA (plan do check and act)
Key Achievements of 2022 closed-loop management constantly pursuing excellence continuous improvement and the spirit of craftsmanship.Our commitment is to provide high-quality advanced material solutions to society and fulfill people's aspirations for
a better life.Cumulative patent applications: 5401 design patents: 34
Since our establishment Kingfa has relied on technological innovation setting standards and winning through
3951 459 excellent service. We continuously optimize our brand management system actively expand our global presence Including invention patents: and PCT patents: and establish the concept of "Kingfa Quality" to earn the trust of customers and gain market recognition.
utility model patents: 688 Quality Control
We actively implement an excellent performance model and a quality strategy based on achieving high quality in five
Awards Received in Recent Years (Partial List) areas which are customers products supply chain operations and employees. This has formed into a model with
Kingfa's characteristics of value creation and flexible quality management. By prioritizing safety upholding integrity
Year Award Project Name Awarding Organization Award ecipient strengthening management and striving for excellence we achieve our high-quality development.China Patent Biodegradable China National Intellectual Kingfa We focus on building the foundation of quality capabilities and actively promote standardization in the company.Excellence Award Polyester Composite Property Administration Zhuhai Kingfa This has resulted in the effective integration of various management systems based on our standards system
including quality environment occupational health and safety hazardous substances energy laboratories
metrology social responsibility intellectual property and confidentiality. Our integrated system is known as KMS
R&D and Application (Kingfa management system) which embodies our standardization management. Technical standards with product
Second Prize for of High-performance China National standards at the forefront serve as the core while basic standards serve as a platform. The organically complete
2021 Scientific and Polyolefin Materials for Light Industry Kingfa system includes processes (management standards) as the links roles (work standards) as the nodes and quality
Technological Progress Emergency Epidemic Council (technical standards) as the criteria.Prevention
We strictly control product quality and have established a comprehensive quality management organizational
Silver Award of Guangdong
Biodegradable Polyester Kingfa structure. We continuously improve internal regulations and have developed internal systems and standards for
Guangdong Patent Administration for
Composite Zhuhai Kingfa quality management such as our Quality Manual Incoming Inspection Process Product Process Quality Control
Award Market Regulation Management Specifications Finished Product Sampling and Testing Management Regulations and Product
Delivery Quality Control Specifications. These internal systems and standards ensure quality management and
Research and Industrial supervision throughout the entire product process enabling us to provide customers with high-quality products
First Prize for Scientific China National
Application of Intelligent in compliance with quality standard. To strengthen employee quality management behavior we have developed
2022 and Technological Light Industry Kingfa
Plastic Manufacturing the Quality Incentive Management Standards and Quality Improvement Fund Management Regulations. These
Progress Council
Technology initiatives aim to enhance employees' awareness of quality management by providing incentives and rewards. By
implementing these measures we ensure that quality management is integrated into every aspect of our work.
41 422022 Environmental Social and Governance Report
Our quality management system extends across our entire business ensuring the quality of the products and
services we provide. Kingfa's quality management system has the certifications of ISO 9001:2015 IATF 16949 and Key Achievements of 2022
GB/T 19002. Our analysis and testing center has also received the Laboratory Accreditation Certificate from the China
National Accreditation Service for Conformity Assessment (CNAS). Kingfa has been widely recognized both within
and beyond the industry for its excellent quality management work. We have received numerous awards including
the Chinese AAA Quality Integrity Enterprise National Advanced Enterprise in Implementing Excellent Performance Product qualification rate: 99.41%
as well as quality awards from the provincial government of Guangdong from the governor of Jiangsu and from the
mayors of Guangzhou and Suzhou. Complaint resolution rate: 98.4%
Product Recalls
Our Product Delivery Quality Control Specifications clearly defines the process and responsible departments for
product recalls standardizing the management of recalling defective products and safeguarding customers' rights to
the best quality. Since our establishment we have not experienced any product recalls.Operation Department
According to the instructions from the Quality Department regarding
product recalls we will arrange the recall of non-compliant products
from the market and handle subsequent related tasks.Planning and Warehousing Department
China National Accreditation Service Measurement Management System
for Conformity Assessment (CNAS) Certification (AAA) Certificate The Operations Department is responsible for arranging the
transportation of recalled products and implementing corresponding
measures as required by the market.Quality Control Department
The Quality Control Department is responsible for ensuring quality
throughout the entire production process. They lead analyses on the
causes of non-compliant products and supervise the implementation
of corresponding measures as well as verifying the effectiveness of
subsequent product improvements.Product recall process
ISO 9001:2015 IATF 16949:
Certificate 2016 Certificate
43 442022 Environmental Social and Governance Report
Quality Culture Leading the Market and Serving Customers
As a global leading chemical and advanced materials company we always prioritize a quality culture and
continuously promote the quality awareness of our employees. Through internal external and specialized training
we continuously strengthen the foundation of quality management and firmly establish the awareness of placing
employee quality as a top priority. In 2022 we conducted a variety of training courses including internal auditor Kingfa is committed to providing customers with high-quality products and services and has developed a business
training Six Sigma Green Belt training training on quality tools and mistake-proofing workshops. model centered around our core competitiveness of providing customers with comprehensive material solutions.Through our global collaborative marketing network we continuously optimize our customer service system to
address customer needs and ensure customer satisfaction with high standards of quality service and responsible
marketing content.Marketing Network
Building a global collaborative marketing network centered around customer needs Kingfa has developed an
integrated customer service system that encompasses regions customers and industries
2022 workshop on mistake proofing for production and 2022 Six Sigma Green Belt training
manufacturing systems
Key Achievements of 2022
Quality training conducted: 61 sessions Employees involved:over 10000 person-time
Region Client Industry
Golden Shield Program Training Project
Establishing a global Establishing key account Establishing industry
In order to promote the development of core quality talent and enhance the organizational capability in quality collaborative service network managers managers
management at Kingfa we have launched the Golden Shield Program. The aim of this program is to enhance the in China India the United
professional capabilities of core personnel in quality management. By mastering and applying advanced quality States Europe and Malaysia Implementing meticulous Researching industry trends
management and improvement tools we seek to explore innovative methods to enhance our capabilities of management conducting in- and requirements through Responding to customer
quality management and improve the stability of product quality for key customers. The first phase of the depth research on customer collaboration between needs quickly
Golden Shield Program was officially launched in 2022 with the participation of 54 engineers. As part of the demands and providing the Marketing Industry
program core personnel in quality management positions in the modified materials related departments comprehensive solutions Manager and technical
underwent professional training including coursework practice exercises and practical implementation and industry experts providing
produced comprehensive upgrade schemes upon the completion of classes so as to assist Kingfa in forming a comprehensive solutions for
unified development path of product quality work in a systematic way. the industry
Quality Identification Quality Knowledge Process Innovative
management of customer management of modified quality problem-
mindset requirements in R&D plastics control solving
Training framework for the first phase of the Golden Shield Program
45 462022 Environmental Social and Governance Report
Around our integrated customer service system we have planned and established a global marketing network that
spans vertically horizontally and across multiple intersections. Responsible Marketing
We pay attention to the current and future changes in customer demands and have developed a distinctive
The vertical axis refers to the strategic development of the industry marketing model at Kingfa that revolves around the comprehensive understanding of customer needs. We strictly
adhere to the requirements of relevant laws and regulations such as the Advertising Law of the People's Republic
It involves studying changes in demand of customer product applications within the industry. Trough of China and closely monitor information disclosure in our promotional and marketing materials across various
proactive engagement and collaboration with customers we aim to provide new products and channels. All marketing and promotional materials must be approved jointly by the Marketing Center Securities
materials that meet future needs. We offer customized industry-wide solutions for advanced materials Department and the Corporate Communications Department before they can be officially released to the public.enabling our customers to achieve a cost-effective balance and quickly gain market share during the In addition we have established management requirements for product labeling and implemented strict labeling
early stages of new product launches. By catering to both customer and industry needs we facilitate processes to regulate the use of product labels. As of the end of the Reporting Period Kingfa has not received any
seamless connections with the end-users of enterprise customers. litigation or regulatory penalties related to product labeling.The horizontal axis represents our regional business expansion strategy Confirmation by Joint approval by the Submission of the Brand and Marketing Center the
Through this approach we directly engage with upstream plastic product manufacturers who are marketing material Securities Department
our B-end customers at the regional operational level. We provide them with relevant products of requirements
Communication
team and the Corporate
modified plastics and polymer materials that are urgently needed for their production and delivery Communications Department
requirements. The service radius of our regional business marketing network is set to 300 kilometers or
less ensuring fast and efficient order fulfillment. With the marketing concept of considering orders as Review process of marketing materials
commands and contracts as paramount we maintain strong customer loyalty.We continuously optimize the work standards of our marketing team. We have conducted various marketing training
programs such as the Swordsmith Program Sharpening Phase IV Overseas Sharpening Phase I and Campaign
The multiple intersections refer to high-value major customers Leader Program for different types of marketing personnel. These training courses have effectively enhanced the
service awareness and professional skills of our marketing personnel.Through vertical and horizontal business operations we identify high-value major customers that span
across industries and regions. We select core marketing members to allocate a service team for fast
delivery. Based on the production processes and specific characteristics of our major customers we
tailor high-quality products and establish large-scale customized delivery models. This allows us to
provide personalized services that cater to the specific needs and requirements of each customer.Customer Satisfaction Swordsmith Program Sharpening Phase IV
Started in August 2020 target ing market ing Started on June 27 2022 targeting marketing
We are committed to providing our customers with services of the highest quality. We continuously optimize our newcomers with 1-3 years of experience professionals with 4-8 years of experience
communication channels to efficiently address customer inquiries and meet their needs. We strive to enhance
service quality and improve customer satisfaction. We have developed a series of management measures such
as the Customer Complaint Management Guidelines and the After-Sales Service Policies to standardize the
handling of customer complaints and the process of after-sales service. These measures enable us to promptly and
comprehensively understand customer demands and feedback.Every year we conduct online satisfaction surveys with our key customers. The surveys cover various aspects Overseas Sharpening Phase I Campaign Leader Program
including satisfaction with the technical specifications of products product quality stability color stability Started on October 22 2022 focusing on the Started in October 2022 aimed at cultivating
appearance and packaging cost-effectiveness of products timeliness of after-sales service timely delivery product development of overseas business talents campaign leaders for global marketing coordination
development cooperation and service attitude. specifically targeting key marketing account managers
474802
Safety Coming First as
the Solid Foundation for
Development
Kingfa always prioritizes safety and proactively integrates safety principles into all aspects of production and
management. We firmly adhere to safety in our development continuously improve our safety management system
and enhance our safety management capabilities. We prioritize and regulate employee safety behavior with a focus
on protecting their occupational health and enhancing their safety awareness. We strive to create a safe and healthy
work environment promoting the well-being of all our employees.Key Achievements of 2022
Investment in safe production: RMB 78279200
Contributing to the UN SDGs2022 Environmental Social and Governance Report
Chemical Safety at the Forefront Compliance Management for Special Equipment
We have established clear safety usage specifications for production equipment requiring departments that
operate equipment and relevant technical personnel to develop safety procedures based on process requirements.Kingfa implements full lifecycle management for product safety. We strictly regulate the use and management Employees must undergo training before they are allowed to operate equipment. For some special equipment
of chemicals conducting comprehensive identification and assessment of all chemical substances used. We operators must obtain a nationally recognized certificate. We also keep comprehensive management records to
have established measures to ensure that our products do not have any adverse impact on human health or the ensure a high level of compliance in matching special equipment with specialized operations.environment during their use. We assign specific responsibilities and establish clear procedures and operational
standards to ensure that personnel use special equipment as required. Hazard Investigation and Emergency Drills
Chemical Safety Management
Safety Inspection Hazard Management
We strictly comply with laws and regulations such as the Regulations on the Safety Management of Hazardous
Chemicals. We have established the Hazardous Chemical Control Procedures which provides clear instructions and Establishment of the Three-Tier Safety Inspection System for S a f e t y h a z a r d s s h o u l d b e
requirements for the procurement storage use and disposal of hazardous chemicals. We follow the classification the company departments (workshops) and teams reported in the Safety Production
and labeling of commonly used hazardous chemicals according to the standard GB 13690-2009 Classification Conducting inspections daily weekly monthly as well as Management Information System
and Labeling of Hazardous Chemicals as well as the List of Hazardous Chemicals. We identify classify and label special and irregular inspections and submitted for handling by
hazardous chemicals in strict accordance with these regulations and we keep records of all major hazard sources relevant departments
associated with hazardous chemicals. In addition we conduct regular evaluations of chemical safety and have
developed detailed contingency plans for the on-site handling of chemical spills and accidents. These measures are Emergency Management R e s p o n s e t o s a f e t y h a za r d s
implemented to minimize the potential hazards and risks associated with such incidents. including corrective measures
Each subsidiary formulates and implements emergency responsible parties and completion
In the procurement process H a za r d o u s c h e m i c a l s Hazardous chemicals should be response procedures and contingency plans for safety time should be provided within
we purchase highly toxic m u s t b e s t o r e d i n obtained by personnel designated incidents; these documents are updated every three two working days and immediate
chemicals drug precursors specialized warehouses by the relevant department and years and are filed with the relevant government action should be taken to rectify the
a n d e x p l o s i v e - p r o n e that have been approved who have undergone training authorities issues
hazardous chemicals from by relevant government and assessment. Once obtained Each subsidiary conducts regular emergency drills The safety production leadership
q u a l i f i e d s u p p l i e r s . W e d e p a r t m e n t s . T h e the hazardous chemicals should
team conducts regular reviews of
require these suppliers to h a z a r d o u s c h e m i c a l be kept under the custody of a
the rectification progress
provide the corresponding warehouses are managed dedicated individual within the
s a f e t y t e c h n i c a l by p ro fe s s i o n a l s w i t h department. Personal protective
specifications and we also technical expertise and e q u i p m e n t ( P P E ) s h o u l d b e
report these purchases to the equipped with reliable worn when handling hazardous
public security authorities p e r s o n a l p r o t e c t i v e chemicals and the acquisition and
through online channels for equipment. use of PPE should strictly adhere to
record-keeping purposes. the specified requirements.In the waste disposal phase chemical hazardous waste or other waste generated during the production
process should be treated in accordance with standards such as Management Procedures on Pollution from
Exhaust Gas Wastewater Waste and Noise and collected categorized and temporarily stored according
to national regulations and our waste management procedures. Qualified third-party providers should be
contracted for the transfer and disposal of waste. We conduct full-process risk identification and closed-loop
risk management for the compliant disposal of waste.
51 522022 Environmental Social and Governance Report
Key Achievements of 2022 Safety Management and
Responsibility Allocation
Safety hazards rectified: over 300
On-time completion rate for rectification processes: 100%
Kingfa strictly adheres to relevant national laws and regulations with safety always as the main priority to achieve safe
production and protect our employees. With "0 accident" as the highest goal and the management system of Kingfa
as the management standard we have established a perfect safety production management system through the
combination of target and process management and passed ISO 45001: Occupational health and safety management
Zhuhai Wantong Zhuhai Kingfa system certification. We have established a comprehensive safety production management system and obtained ISO
In June 2022 conducted a comprehensive Conducted a specialized emergency 45001 certification for occupational health and safety management. We have identified and formulated a series of
emergency drill to simulate cylinder drills for chemical leakage incidents internal regulatory requirements such as the Procedure for Identification Assessment and Control of Environmental
leakage steam leakage incidents confined space Occupational Health and Safety Factors the Regulations on Occupational Health Safety and Environmental
operation accidents comprehensive Protection Management and the Regulations on Special Equipment and Special Operations Personnel Management.emergency drills for hazardous material These documents are formulated in accordance with national regulations industry standards and local policies. We also
incidents and specialized emergency implement standards for safety production and management and have obtained certifications such as the second-level
drills for special equipment accidents safety production standardization certification. To fulfill the responsibilities mandated by the Safety Production Law we
proactively carry out inherent safety work to enhance the safety competency of all employees. We promote a proactive
safety culture to ensure the smooth progress of production and business activities.Ningbo Kingfa Liaoning Kingfa
Conducted a comprehensive emergency Developed emergency response plans Safety Management Framework
drill for ammonia leakage in the tank area and conducted corresponding drills for
incidents involving major hazards and We have established a streamlined and efficient safety
Developed an Emergency Response on-site risks associated with hazardous management framework which includes the formation of Key Achievements
Facilities Inventory Form that includes chemicals such as hydrogen cyanide and a Safety Production Leadership Group. The group is led by of 2022
firefighting emergency equipment such acrylonitrile and additionally conducted the General Manager and consists of department heads from
as air respirators fire blankets fire axes an emergency response drill for butadiene relevant production departments. This framework ensures a
and others equipment sphere tank leakage and personnel clear chain of command and accountability with responsibilities
poisoning drill and duties delegated at each level of the organization. We have Special safety production inspections: 13
established a mechanism for conducting regular meetings
on safety production management. The Safety Production
Partial list of emergency drill activities conducted by chemical subsidiaries Leadership Group holds working meetings to periodically Hazard source inspections: 9
review and summarize safety management efforts. During these
meetings the group discusses and addresses safety issues that
arise in the course of production and operations ensuring timely Special emergency drills: 3
improvement and response. Under the centralized management
model of safety production at Kingfa each subsidiary company
Safety meetings at the group level: 5
establishes a local Safety Production Leadership Group to
promote the implementation of group decision-making
guidelines and management requirements as well as undertake
safety production management. Each site establishes a three-
tier streamlined safety network that spans from the company to
departments and teams to ensure effective communication and
Fire Safety Month activities in 2022: emphasizing fire safety for high-quality development coordination of safety-related matters.
53 542022 Environmental Social and Governance Report
To strengthen the implementation of safety responsibilities and risk management Kingfa has established a Risk
Control Center. The center developed and strictly adheres to the occupational health safety and environmental (HSE) 2020 2021 2022
performance evaluation system and conducts regular internal audits of safety risks. It also organizes safety production
work exchanges among various sites to enhance communication and collaboration. To identify risks in various stages of Safety training coverage (the
production and operation and prevent accidents and safety issues we extend the internal audit work of the environmental 5277 6408 7857number of participant)
and safety management system to all production sites and departments. This promotes risk resolution and improvement
efforts at each production site. By implementing standardized assessment criteria and audit requirements Kingfa and
our subsidiaries effectively manage risks leading to an overall improvement in the level of safety management across the
group. In addition we provide safety training for outsourced construction crews and conduct visitor safety training for all Safety training (hours) 118 152 181
incoming personnel.Safety Production Expenses (In ten thousand)
Average training duration
34.55
6881.89 5698.10 7827.92 (hours/person)
202020212022
Safety Training Fire monitoring training Fire emergency drills
To promote a culture of proactive safety Kingfa has established a comprehensive safety management training system
from ideology to implementation. Safety training is an essential component of safety production management and serves Safety Education
as a significant indicator for safety assessments. Every year we develop a safety work plan and implement a safety training
program that requires the participation of all employees. In addition we enhance employees' safety awareness and foster
a proactive safety culture through various activities such as online and offline knowledge competitions and skill-based Three levels Safety Specialized Safety training Supplementary Safety training
contests. These initiatives create a dynamic safety environment for employees and strengthen their safety consciousness. of safety education for safety training for specialized safety prior to
education for job transfers
operations education promotion
Practical safety training and emergency drills are mandatory courses for our production employees. Based on risk new employees and resumption
identification and assessment we have developed emergency response plans for accidents and unforeseen events. Every of work
year we conduct training and drills on fire safety occupational health and emergency response to hazardous chemical
incidents. This ongoing training helps to cultivate and strengthen our employees' emergency response capabilities.
55 562022 Environmental Social and Governance Report
Safeguarding Occupational Health
Key Achievements of 2022
We strictly comply with relevant laws and regulations such as the Occupational Disease Prevention and Control Severe injury rate per million working hours: 0.28
Law of the People's Republic of China and have established regulations and procedures such as the Regulations
on Occupational Health Safety and Environmental Protection Management the Program for Identification
Evaluation and Control of Environmental Occupational Health and Safety Factors and the Regulations on
Labor Protection for Female Workers. These documents are designed to regulate employee behavior strengthen
supervision and inspection and effectively ensure the occupational health and safety of our employees. Occupational Health and Safety Testing
When signing employment contracts with employees in positions involving exposure to occupational hazards we Every year we hire qualified third-party organizations to conduct regular
provide truthful information about potential occupational hazards and their consequences as well as occupational testing on premises that may affect environmental occupational health and
disease prevention measures. This information is clearly stated in the employment contracts. We have developed safety. The testing includes assessing physical and chemical hazards such as
an annual occupational health examination plan in accordance with GBZ 188-2014 Technical Specification for noise high temperature dust toxic substances and others.Occupational Health Surveillance. We select provincial hospitals qualified for occupational health examinations to
provide employees with regular medical check-ups. These examinations aim to detect and prevent the occurrence
of occupational diseases as well as strengthen the management of employees' occupational health. We require
each subsidiary to provide free personal protective equipment that complies with national standards to employees Identification of Environmental Occupational Hazards and Risk
working in positions with occupational hazards. We also provide training and supervision to ensure that employees
wear the equipment correctly. In workplaces and job positions with occupational disease hazards as well as in areas Assessment
with equipment or for materials packaging and storage we ensure the placement of warning signs and occupational
health bulletin boards in prominent locations to draw employees' attention. For personnel engaged in toxic and In accordance with the operational guidance requirements we organize
hazardous operations we require them to undergo occupational health examinations before starting their work departments annually to conduct identification and risk assessment of
during their work period and upon leaving their work. In the event of an emergency situation in the workplace occupational health and safety hazards in the production environment.immediate emergency health examinations are conducted. For employees exposed to occupational risks relevant A comprehensive assessment of environmental occupational health and
measures are taken in accordance with requirements and regular follow-up examinations are conducted. Since our safety hazards is conducted at least once a year.establishment Kingfa has maintained a record of zero confirmed occupational diseases.In addition we continuously upgrade production processes and manufacturing equipment to provide a more
ergonomic work environment for employees. We have developed and implemented various systems such as
automated raw material measurement automated packaging production lines automated stacking systems
vacuum feeding systems and automated blending systems. We also promote engineering improvement projects
such as granulation of raw materials noise reduction in equipment and negative pressure in workshops to enhance
the working environment for our employees and reduce their workload.
575803
Protecting the Environment
for a Greener Future Together
We believe green mountains and clear waters are as valuable as mountains of gold and rivers of silver. We are
committed to pursuing a path of green development and minimizing the environmental impact of our operations on
the planet. We are guided by a comprehensive low-carbon transformation strengthening environmental compliance
management actively promoting diversified new energy ecosystems deepening efforts in energy conservation
and emission reduction advocating environmentally-friendly production and office practices and fostering the
construction of an ecological civilization.Key Achievements of 2022
National green factories: 4 in total
Total annual investment in environmental protection:RMB 56402300
Energy savings in the modified plastic sector: 1197.77 tons of standard coal
Roof photovoltaic power generation: 11.37 million kilowatt-hours
Contributing to the UN SDGs2022 Environmental Social and Governance Report
Setting Clear Goals and Improving Management Kingfa's Environmental Goals
Energy Emission Reduction Waste Reduction Water Conservation
A sound environmental management system is the foundation for ecological protection. To ensure the achievement By 2023 achieve energy Over the next 3-5 years By 2023 save 10 tons By 2023 conserve
of environmental objectives and the implementation of various systems we continuously improve our environmental savings of approximately annually reduce VOCs of packaging waste 168320 tons of water
management system. We uphold environmental compliance enhance awareness of environmental risk prevention 2000 tons of standard emissions by 1000 tons
and effectively enhance our environmental management capabilities. coal in the modified
plastic sector
Improving Environmental Management We attach great importance to ecological and environmental protection continuously increasing environmental
investment. In 2022 the investment in environmental protection amounted to RMB 56402300 representing a year-
on-year growth of 2.35%.Kingfa strictly adheres to laws and regulations such as the Environmental Protection Law of the People's Republic Environmental Investment (In ten thousand)
of China and the Regulations on Environmental Protection Management of Construction Projects continuously
improving our environmental management system. By the end of the Reporting Period Kingfa and our subsidiaries
including Tianjin Kingfa Chengdu Kingfa and Guangdong Kingfa have obtained ISO 14001:2015 certification for
environmental management systems. 4886.84 5510.87 5640.23
We have established an environmental accountability system with the General Manager as the highest decision-
maker ensuring the cascading implementation of environmental responsibilities and the prevention and
reduction of unforeseen environmental incidents. We included indicators such as administrative penalties related
to environmental issues the number of environmental monitoring failures and other relevant metrics for each
department in our performance assessment. We have established a system of rewards and penalties to effectively
safeguard our level of environmental management. At the same time we require all subsidiaries to document the
process and outcomes of their environmental management efforts and create environmental protection archives for
future reference.
202020212022
Kingfa has established and improved the construction of environmental protection compliance management system
and strictly implemented the "three simultaneous" system for environmental protection of construction projects
to achieve simultaneous design construction and operation of environmental protection supporting equipment
and the main project.. During the process of project design application environmental assessment acceptance Environmental Risk Prevention and Control
and obtaining discharge permits we exercise strict control and ensure timely completion of environmental impact
assessments and the preparation of public archives for construction projects. Kingfa incorporates environmental risk prevention and control into regular enterprise management continuously
enhances the level of environmental risk prevention and strengthens proactive measures. We have established an
According to our Energy Target and Management Program Procedures we establish energy goals and indicators emergency response mechanism for unexpected environmental incidents and have developed guiding documents
and decompose them to each department. We also develop detailed energy management implementation plans for such as the Emergency Response Plan for Environmental Incidents and the Environmental Emergency Resource
each objective and indicator to continuously improve our energy efficiency. Additionally we establish measurable Investigation Report. We also establish an emergency response team responsible for handling unexpected incidents
and specific emission reduction and water conservation targets to coordinate and promote the achievement of our and environmental demands. They ensure that our factories can quickly accurately and efficiently carry out
overall environmental goals across the entire company. emergency response measures to control mitigate or eliminate personnel casualties and property losses caused by
unexpected environmental incidents.
61 622022 Environmental Social and Governance Report
Additionally we conduct environmental risk assessments based on HJ 941-2018 Risk Grading Method for Unexpected Kingfa has adopted a series of effective resource management measures to improve energy efficiency.Environmental Incidents in Enterprises. Taking into account our specific circumstances we prepared the Risk
Assessment Report for Unexpected Environmental Incidents. It allows us to identify and evaluate potential
environmental risks and develop appropriate strategies and measures to mitigate those risks. We systematically Establish an energy management system Optimize logistics design arrange the
analyze and identify environmental risk sources assess our existing prevention and control capabilities and propose overall layout in the order of processes
practical and feasible work plans and measures to reduce environmental risks. This approach allows us to proactively Enhance energy consumption statistics to save fluid transmission power and
address and mitigate potential environmental risks with effective management and control. and analysis of energy use reduce energy consumption
Improve energy measurement records Implement digitalization and intelligent
to understand the energy consumption design to promote the construction of
status of various units digital smart factories
Clean Production and Low-Carbon System Design
Manufacturing Improvement Optimization
Equipment Process
Improvement Innovation
Upgrade and replace high-efficiency Upgrade the wastewater treatment and
motors and other power equipment reuse process for modified materials to
Introduce and promote new and achieve zero wastewater discharge
Kingfa attaches great importance to the negative impact of its operations on the environment and practices
efficient heating equipment
clean production to improve resource efficiency and reduce emissions. In addition we closely follow the national Develop and apply efficient and green
development strategy and actively engage in constructing green factories to establish an efficient clean low-carbon Optimize and improve energy-saving processes such as low-temperature
and circular green manufacturing system. control for equipment extrusion
Conduct R&D for multi-level use of
We have collaborated with multiple universities and enterprises and realize the application of whole-process node thermal energy in the extrusion process
intelligent linkage technology whole-process intelligent detection technology and whole-element integrated
Internet of Things technology in the production process of plastic manufacturing industry. We have established the
Intelligent Plastic Manufacturing Platform and actively introduce green production technologies and processes.We have also innovated and developed intelligent integrated applications promoting the exploration of new In 2022 Kingfa achieved a reduction in energy consumption of 5.79 kilowatt-hours per ton of product in the modified
applications for green technologies and low-carbon production in the plastics industry. plastic sector compared to the previous year resulting in actual energy savings of 1197.77 tons of standard coal.Roof Photovoltaic Project
Resources Management
In response to the national call for the development of clean energy we actively promote the construction of
photovoltaic power projects at our production bases o inject clean kinetic energy into the company's green and
The main energy sources we use in the production process include water electricity natural gas steam coal-water low-carbon development. As of the end of the Reporting Period the cumulative installed capacity of rooftop
slurry and diesel. We have developed more than ten system documents including the Energy Management Manual photovoltaic systems at Kingfa reached 13.15 megawatts with an additional capacity of 23.16 megawatts under
Energy Management Operation and Control Procedures and Energy Management Training to ensure our energy construction. In 2022 the electricity generated from photovoltaic sources reached 11.37 million kilowatt-hours.management system operates efficiently and to improve the energy efficiency of production and operations. In the future we will further promote photovoltaic construction projects by expanding or establishing rooftop
photovoltaic systems in production bases such as those in Guangzhou or Shanghai. This will increase the
proportion of renewable energy in our power generation and continuously optimize our energy consumption
structure.
63 642022 Environmental Social and Governance Report
Key Performance Indicators for Resource Utilization 2.D irect energy mainly originates from the diesel natural gas and coal-water slurry consumed by Kingfa and our subsidiaries in
China. The data is calculated based on GB/T 2589-2020 General Rules for Comprehensively Calculating Energy Consumption and
GB/T 50441-2016 Energy Consumption Calculation Standards for Petrochemical Design with energy units converted into tons of
Resource Unit 2020 2021 2022 standard coal.
3. The increase in natural gas consumption in the group in 2021 is mainly due to the production of gloves in the medical and
Total energy consumption1 Tons of standard coal 799225.73 704842.32 538822.23 healthcare sector. In 2022 due to the decrease in production capacity in the medical and healthcare sector natural gas
consumption decreased compared to 2021.Direct energy2 Tons of standard coal 332988.08 331099.35 222972.54 4.I ndirect energy primarily comes from the purchased electricity medium-pressure steam and low-pressure steam consumed
by Kingfa and its subsidiaries in China. The data is calculated based on GB/T 2589-2020 General Rules for Comprehensively
Diesel Tons 347.40 392.55 267.91 Calculating Energy Consumption and GB/T 50441-2016 Energy Consumption Calculation Standards for Petrochemical Design
with energy units converted into tons of standard coal.Natural gas3 Cubic meters 3031030.99 45420273.21 17958912.60 5. The purchased steam consumed by Kingfa includes medium-pressure steam and low-pressure steam. In 2022 we consumed
1641952.22 tons of medium-pressure steam and 427803.00 tons of low-pressure steam.
Coal-water slurry Tons 512680.14 432334.24 314168.09
Pollutants Discharge Management
Indirect energy4 Tons of standard coal 466237.64 373742.97 315849.69
Purchased electricity 10000 kilowatt-hours 82756.57 77610.47 73305.54 In response to pollutant emissions during the production process Kingfa strictly adheres to relevant national
standards such as the Comprehensive Emission Standards for Air Pollutants the Emission Standards for Odor
5 Pollutants and the Standards for the Unorganized Emissions of Volatile Organic Compounds. We have established Purchased steam Tons 3346163.16 2508028.83 2069755.22
stringent policies to regulate waste disposal such as the Management Procedures on Pollution from Exhaust Gas
Wastewater Waste and Noise and the Waste Management Procedures. We promote wastewater reuse projects and
Tons of standard coal
Energy consumption embrace the concept of zero direct discharge to protect the environment.per RMB million of 22.80 17.53 13.33
density
revenue We have established regular inspection mechanisms for exhaust gas wastewater noise and other pollutants
arranged online monitoring and early warning facilities for organic exhaust gas and wastewater one after another.Tons of standard coal We also entrust third parties to inspect our pollution control facilities and their compliance of emissions and strictly
Direct energy per RMB million of 9.50 8.24 5.52 fulfill our environmental protection responsibilities to ensure compliance with emission standards.revenue
Tons of standard coal
Indirect energy per RMB million of 13.30 9.30 7.82 Exhaust Gas Management
revenue
I n order to maximize the separate collection of all exhaust gases we designed an exhaust gas collection system
Total water consumption Tons 5614303.19 5359027.47 3870988.98 to transform unorganized emissions into organized emissions that can be controlled
Water consumption Tons per RMB million New projects adopt fully enclosed negative pressure discharge measures with a VOCs collection efficiency of 95%
160.13133.3195.79
density of revenue
T o improve organic exhaust gas the three-chamber RTO combustion process helps us achieve a treatment
efficiency of 80-90% during end-of-pipe treatment and significantly reduces exhaust gas emissions
1. In 2021 the suspension of isooctane production at Ningbo Kingfa led to a reduction in the group's total energy consumption compared
to 2020. In 2022 natural gas consumption in the medical and healthcare sector decreased compared to 2021. Additionally the
suspension of isooctane production at Ningbo Kingfa led to a decrease in the group's energy consumption in 2022 compared to 2021.
65 662022 Environmental Social and Governance Report
Wastewater Management Special Measures for Dust Control
R ain and sewage are separated within the plant. Treated wastewater from the modified plastic sector is reused
for workshop floor cleaning toilet flushing greening road sprinkling and other uses and accounts for 80% of Industrial dust is a significant source of air pollution. By improving processes to reduce dust generation and
the total water used increase dust collection efficiency we control reduce and eliminate related hazards.R egular sewage is treated through a three-stage septic tank and then discharged into the municipal sewage Adding pellets to raw materials can reduce dust dispersion improve
pipe network after meeting standards
Substituting cleanliness during the production process thereby ensuring the health and
powdered safety of workers
materials with Directly mixing some colorant powders into raw materials without
pellets diffusion can easily create color streaks but using pellets can reduce such
Waste Management occurrences
General industrial waste is internally recycled and sold to external recycling units or entrusted to
general industrial waste treatment facilities for recycling and disposal The automatic weighing and batching control system for micro-ingredients
Applying enables the automatic control and management of weighing and batching
Hazardous waste is entrusted to qualified organizations for recycling and disposal automatic micro- for materials. This ensures consistent accuracy in micro-ingredient
ingredient batching
In the petrochemical division waste generation is reduced through sludge drying processes weighing By improving production efficiency the system minimizes open material
technology handling thereby reducing dust emissions and the need for dust collection
and treatment as well as labor costs
Noise Management
Low-noise equipment is prioritized during equipment upgrade Key Performance Indicators for Waste Management
Every year accredited environmental monitoring agencies are commissioned to conduct noise measurement Waste Emission Unit 2020 2021 2022
and issue boundary noise monitoring reports and workplace noise monitoring reports
Total hazardous waste1 Tons 1343.81 2026.20 3360.60
Hazardous waste emission Tons per RMB million
0.040.050.08
Kingfa's disposal methods for exhaust gas wastewater waste and noise intensity of revenue
Total non-hazardous waste Tons 6087.59 11665.10 17442.93
General industrial waste12 Tons 2369.21 3397.41 9587.94
Domestic waste3 Tons 1876.20 6022.53 5450.10
Kitchen waste Tons 407.50 616.00 670.60
Other waste1 4 Tons 1434.68 1629.16 1734.29
Non-hazardous waste emission Tons per RMB million
0.170.290.43
Waste disposal and transportation intensity of revenue
67 682022 Environmental Social and Governance Report
1. In 2021 due to the construction of production projects in Kingfa's medical and healthcare sector and Liaoning Kingfa's green petrochemicals Develop online process approvals to encourage paperless offices and avoid
sector there was a significant increase in hazardous waste general industrial waste and other waste (mainly packaging materials) compared unnecessary paper waste
to 2020.
2. In 2022 there was a significant increase in general industrial waste compared to 2021 due to the interim delivery of construction Create a conducive environment for resource conservation by
projects in Liaoning Kingfa's green petrochemicals base as well as the generation of water treatment sludge in the Guangdong posting signs that remind employees to save water and energy
Kingfa nitrile glove production site.Strictly adhere to waste classification regulations label trash bins
3. In 2021 due to the construction of production projects in Kingfa's medical and healthcare sector and Liaoning Kingfa's green Green Office
for proper sorting and help employees better understand and
petrochemicals sector there was a significant increase in municipal waste compared to 2020 as there were more construction workers Practices
on-site. The production projects in the medical and healthcare sector were mostly completed by early 2022 and the production practice waste classification methods
projects in Liaoning Kingfa's green petrochemicals sector were substantially delivered by 2022 resulting in a decrease in municipal Implement a group control system for elevators to optimize
waste emissions in 2022 compared to 2021.operating times based on passenger flow reducing unnecessary
4.The "other waste" category mainly consists of waste generated from packaging materials. idle runs
Set air conditioning temperature at 26 degrees and turn it off 10 minutes
Green Factories before the end of the workday
Kingfa actively carries out the construction of Green Green
green factories by considering six main aspects: Kingfa Manufacturing Kingfa Kingfa's green office initiatives
infrastructure management system energy
and resource input products environmental Management System
emissions and environmental performance. In addit ion Kingfa is committed to enhancing environmental awareness and education raising
Kingfa has become the first company in the employees' awareness of energy saving and converting it into low-carbon actions. We conduct regular Products
industry to receive the national-level honor Production Process environmental training and encourage employees to participate in online training sessions.Energy and
of "Green Factory Demonstration Site" from Resource Input Environmental
the Ministr y of Industr y and Information Emissions
Technology. Wuhan Kingfa and Tianjin Kingfa
have also subsequently obtained the same title. Infrastructure
As of December 31 2022 Kingfa owns a total of
four national-level green factories. Kingfa's model for green factories
Low-Carbon Offices and Green Lifestyle
Kingfa continuously enhances its awareness of resource conservation and takes on the social responsibility to save
energy protect the environment and implement green low-carbon practices. We encourage employees to save
energy in their daily lives and office activities creating a simple moderate civilized and healthy environmental
atmosphere. We strive to constantly improve employees' awareness and abilities in energy conservation carbon
reduction and ecological protection aiming to achieve harmonious and sustainable development among people
resources and the environment.We advocate for a work culture that promotes resource conservation and environmental friendliness. We actively
encourage green office practices to raise awareness among every employee about the importance of resource
conservation and their active participation in energy-saving efforts. Environmental occupational health management training
6970
Performance04
People-Oriented for Better
Lives
Adhering to the principle of "people-oriented" Kingfa values the equal rights and benefits of every employee. We
strive to create a diverse and inclusive corporate culture and empower the growth of employees in all aspects. At
the same time we insist on "social interests as the basis of enterprise development" actively participate in various
public welfare activities and contribute to the construction of a better society.Key Achievements of 2022
Total number of employees: Cumulative number of employees with disabilities:
10353156
Cumulative investment in the Fund for People Employee social insurance coverage rate:
with Disabilities: RMB 38050000 100%
Cumulative employment of veterans： Maternity leave employee return rate:
186100%
Cumulative investment in vocational training in the Investment in poverty alleviation and rural
past 3 years: approximately RMB 45000000 revitalization: RMB 5700000
Contributing to the UN SDGs2022 Environmental Social and Governance Report
Caring for Employees with Equality and Inclusivity Diversified Recruitment
As a global company Kingfa actively recruits talent through various channels. In addition to annual campus
recruitment activities Kingfa also collaborates with more than 10 third-party recruitment agencies to attract diverse
An equal respectful inclusive and diverse corporate culture is the source of our vitality. Kingfa safeguards the rights talent from around the world. The diverse perspectives and approaches of employees contribute to the team's ability
and interests of employees fosters a diverse and inclusive corporate atmosphere implements comprehensive to think in different ways thereby enabling us to provide customers with a wider range of high-quality products
welfare care and continuously enhances the happiness and sense of belonging of each employee. and services. As of the end of the reporting period Kingfa has a total of 10353 employees including 324 overseas
employees accounting for 3.15% of the total workforce. Additionally Kingfa has cumulatively employed 156
Equal Rights and Benefits employees with disabilities and 186 veterans.Kingfa strictly adheres to international labor standards and Chinese labor laws and regulations including the Labor Employees categorized by age Employees categorized by education
Law of the People's Republic of China and the Labor Contract Law of the People's Republic of China. We have
formulated internal management regulations such as the Recruitment Management Regulations the Management 7.4%
Regulations on Child Labor and Juvenile Workers the Management Regulations on the Prohibition of Forced 24.7%
Labor and the Management Regulations on Anti-Discrimination and Anti-Harassment to effectively safeguard the
rights and interests of our employees.During the recruitment process we uphold the principles of fairness and voluntary participation ensuring that no
coercive or deceptive means are used to attract applicants. We strictly prohibit the employment of prison labor
contract labor bonded labor slave labor child labor and similar forms of exploitative labor. Furthermore we do not 8.7%
engage with any suppliers or subcontractors who employ child labor or practice forced labor. We strictly comply with 29.4%
laws and regulations when signing labor contracts with employees and clearly define the rights and obligations of 1.2%
both the labor and management parties. Under no circumstances do we allow managers to violate the basic human
rights and dignity of employees and we strictly prohibit any form of threats humiliation or exploitative behavior. We
treat all employees equally in all aspects of recruitment probation promotion and end of employment regardless 63.2% 65.4%
of their race nationality gender religion sexual orientation age or physical conditions. We strongly oppose any
form of discrimination and strive to provide a fair and inclusive work environment and equal opportunities for career
development and advancement for all employees. We also emphasize gender equality and equal pay for equal
work and have formulated the Management Regulations on Labor Protection for Female Employees to effectively Below 30 30-50 Above 50 Bachelor Master Doctor Others
protect the rights and interests of female employees from infringement.To promptly address cases of discrimination and harassment we provide internal channels for employees to file
complaints. Employees can submit their complaints through suggestion boxes internal email our OA system or
directly contact the relevant responsible person to report such cases to the company. The company management
will assign dedicated personnel to thoroughly investigate the complaint and provide a response to person who filed Employee Communication
the complaint within 15 days. Upon verification appropriate actions will be taken against the reported individual
ranging from education for minor offenses to legal prosecution for serious offenses. Effective communication is a key element in maintaining a positive team dynamic and ensuring teams function
efficiently. We uphold the communication concept of "following the process respecting superiors respecting
subordinates and being sincere and proactive" and have established diverse and transparent communication and
Diversity and Inclusivity feedback channels to promptly understand and respond to the thoughts and demands of our employees. This
approach aims to fully engage employees in company operations decision-making and cultural development.Kingfa establishes and maintains a culture of diversity and inclusion recruits talents through diverse channels
and builds a diverse workforce. We attach importance to employee communication and listen to their feedback to To provide opportunities for face-to-face communication and exchange between employees and the management
enhance employee engagement thereby strengthening team cohesion. we regularly organize grassroots meetings and weekly meetings as well as semi-annual and annual conferences.
73 742022 Environmental Social and Governance Report
These platforms facilitate internal communication among employees and enable open dialogue between
employees and management. Every year we conduct employee engagement surveys in the form of questionnaires Employee Welfare
to understand the views and suggestions of employees regarding work experience cultural atmosphere company
vision long-term development and other aspects. As of the end of the Reporting Period we have received We provide employees with various types of benefits including insurance paid leave condolence payments
thousands of rationalized suggestions from employees which can effectively help the company in identifying issues subsidies and supporting infrastructure. Starting from the needs and expectations of employees we aim to provide
empowering management and optimizing overall corporate performance. more personalized and caring services. We ensure that employees are entitled to their legal rights to annual
leave sick leave maternity leave nursing leave marriage leave bereavement leave parental leave and other
types of leaves. We also provide various benefits and allowances such as annual and quarterly welfare benefits
Key Performance Indicators for Employee Hiring in 2022 transportation subsidies and seniority allowances to our employees. We provide comprehensive and well-equipped
KPI 2020 2021 2022
facilities to our employees actively creating a positive work environment that feels like home. In addition to a staff
canteen that provides three meals a day we have established the Kingfa Residence which offers various types of
Total employee hire rate 33% 21% 18% dormitories for our employees. Employees also have the convenience of commuting to the workplace through our
shuttle bus service. By providing kindergartens free school buses and education subsidies we help employees
address practical challenges in childcare children transportation to school female employees returning to work
after childbirth and in other aspects. In addition we have set up a medical room to provide employees with basic
Total employee turnover rate 23% 18% 14% health diagnosis and counseling services for their mental well-being.Employee hire rate (non-frontline) 10% 15% 13%
Five
insurances
Health and oneEmployee hire rate (frontline) 23% 6% 5% checkup housing
fund
Employee turnover rate (non- Team
4% 7% 5% building
frontline)
Holiday Kaleidoscope u
Employee turnover rate (frontline) 19% 11% 9% Guangzhogreetings of benefits residency
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arri
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Employee Welfare and Care Package ia
Family
care Commuter
A truly vibrant company always has a culture of care. We always prioritize the needs of our employees and shuttle
continuously improve and upgrade various welfare benefits to provide them with multidimensional care and
support. We strive to create a warm and welcoming environment and bring "home-like" warmth to employees.A kaleidoscope of welfare for Kingfa employees
7576
Paid leave
cise
ff ex
er
a nd entSt a
tain
m
er es
ent faci
liti2022 Environmental Social and Governance Report
Caring for Employees For three consecutive years from 2020-2022 Kingfa was named a "Guangzhou Enterprise with an AA Rating for
Harmonious Labor Relations" by five departments including Guangzhou Municipal Human Resources and Social Security
To increase the happiness index of all employees and build a family culture at the workplace Kingfa has launched several Bureau; in 2022 Kingfa received the "Best Employer in Guangzhou" from an acclaimed job search platform.programs to engage with employees including sending holiday greetings granting tiny wishes providing beverages to
cool off in the summer and hosting New Year's dinners. Kingfa has established a financial relief program for assisting
employees who are going through difficult times ensuring that their basic needs are met. We have also set up a quick
dining lane for pregnant women at our cafeteria and nursery spaces to provide pregnant women and new mothers with a
comfortable working environment.Kingfa cares about the mental and cultural health of our employees so we have upgraded over 3000 square meters
of employee activity space constructing badminton tennis and basketball courts dance rooms and gyms. We have
invested in setting up 10 clubs which organize a variety of literary and sports competitions and entertainment activities
offering staff a wide range of options for leisure activity. We care about our women employees and carry out a series
of thematic events on International Women's Day such as training on topics impacting women and voting for "March
8th Red Banner Pacesetters". We pay attention to the mental and physical health of women employees and affirm the
important contributions that women employees have made to our company's development.Guangzhou Enterprise with an AA 2022 Best Employer in
Rating for Harmonious Labor Relations Guangzhou
Empowering Talents Sharing Value
Talent is the fountainhead of continuous development and the most precious resource of a company. Pursuing a
mission of "Shared struggle shared growth shared prosperity" Kingfa unceasingly innovates and improves the
New Year's Campus Visit Mid-Autumn Dinner
talent development system to provide employees with a vast platform for professional development. The company
has created a "Cake Theory" incentive system of value sharing which combines company development with
employees' personal interests and achieves a resonance between company development and the growth of talent.Career Development
Kingfa adopts an employment concept in which "employees have both ability and integrity people let their talent shine
and talent is put to good use". We care deeply about the professional development of employees and offer them a
broader space for career advancement by providing dual-path development as well as opportunities for job rotation.Dual Tracks for Career Development
"The Age of Dreams "March 8th Red Banner
and Prosperity" Art and Pacesetter" Activity The company has established dual development tracks for management and professional skills. The professional
Cultural Event Awards Ceremony path involves marketing skills operational abilities and other professional categories. Employees can choose a
career development path according to their own specialties and aspirations.
77 782022 Environmental Social and Governance Report
Focusing on personnel Focusing on individual work utilize
management lead others to work individual expertise/skills to help Cadre Rotation System
to achieve organizational goals achieve organizational goals
To invigorate cadres and strengthen the internal flow of talent within the company Kingfa has established a
"Cadre rotation system" and offers opportunities to temporarily serve in higher positions to supervisors who
5 stars show potential.Leader Expert
Supervisors who have served for at least
4 stars Senior Manager
engineer 3 years (inclusive)
are advocated to rotate
Intermediate
3 stars Supervisor engineer
Supervisors who have served for Supervisors with annual 2 stars Engineer Job Rotation
more than 5 years (inclusive) performance appraisals of "D" and
Target below
1 stars Assistant engineer
must rotate must rotate
Dual paths for development
Supervisors who have served for 1-3
Based on competency models and qualification systems the company has created job promotion standards which are years
differentiated reasonable and effective. Employees at the corresponding ranks along the two paths receive identical benefits. voluntarily apply for the rotation
Whether they hold management positions or professional and technical positions employees who have the ability can be
promoted continuously in their own development paths and receive salary compensation that matches their strength.Rotation Mechanism Salary and Incentives
Kingfa's job rotation mechanism offers employees more options for professional development. Employees can
change positions on the Professional Path and Management Path according to their individual professional plans and Kingfa's salary structure combines a basic salary with a fluctuating
needs. The job rotation system encourages employees to tap into their personal potential develop in well-rounded wage offering employees a salary and incentive system which
ways and become multi-talented individuals with diverse skill sets. is internally fair and externally competitive. To attract and retain Pay for Pay for
exceptional talent and to invigorate teams Kingfa continuously competency position value
works on salary reform strengthens the assessment and incentive
role of fluctuating wages amply affirms employee value and Pay for
brings positivity to employees at work. performance
Transfer from management channel to Transfer from professional skill
professional skill channel channel to management channel We have established a differentiated compensation schemes for
After holding a management position those When there are vacancies in management employees in different positions and ranks improving the target
who will no longer serve as managers for p o s i t i o n s p ro fe s s i o n a l te c h n i ca l responsibility incentive assessment system for marketing and
personal reasons or inability to meet new employees can part ic ipate in the technical personnel fixed annual salary for internal operations
requirements can be transferred to the competition for the positions. Those who personnel and piece work wages of front line operating personnel 3P salary system
professional skill channel after obtaining meet corresponding requirements can be creating a complete 3P salary system. In addition we continue to
corresponding qualifications. transferred to the management channel. push for internal assessment and incentive policies which relate to
sustainable development such as sharing the benefits generated
Job path rotation mechanism by cost reduction and efficiency projects with project employees.
7980
Professional skill channel
Management channel2022 Environmental Social and Governance Report
Goal-Based Responsibility System Key Achievements of 2022
Kingfa has established a highly effective talent incentive mechanism and continues to innovate and improve
incentive methods. In 2018 Kingfa launched the job target responsibility system which gradually delegates Average training hours for employees: 56 hours
company's target to various key positions steering employees towards the company's main goals through
incentivization to achieve the most outstanding results. The job target responsibility system effectively
recognizes and affirms the value of each position and employee motivating them to generate benefits for the Amount invested in vocational training in 2022: RMB 11000000
company while acquiring their own individual value.Proportion of employees received periodic performance assessment and professional development
In 2022 the job target responsibility system assessment covered more than 1000 employees including those
in core management business personnel technical personnel internal operations department heads and core evaluations: over 90%
positions at branch companies. Targets were achieved at a rate of 46%. This system reinvigorates employees
and inspires positivity helping the company to achieve extraordinary results.Internal Training
Stock Incentive Plan In 2014 Kingfa founded the Kingfa Global Innovation Training and Development Center and established a training
system that corresponds with the company's dual paths for career development. On the basis of conventional
To inspire enthusiasm initiative and creativity among senior management and core talent and improve the training the center emphasizes 5 management training plans and 3 professional training programs which form
company's operational management Kingfa established its employee stock plan in 2016. During the Reporting a strategic employee echelon training system that continuously outputs talent. To help improve employee
Period the company formulated the "2022 Limited Stock Incentive Plan (Draft)" designating 1350 employees to development Kingfa has created a "Job Learning Map" based on the qualifications needed for different jobs. The
participate in the 2022 annual stock incentive plan - 14% of the total number of employees. This stock incentive map provides learning planning solutions by showing the important knowledge and skills needed for each position
plan improves Kingfa's wage assessment system while achieving shared value by combining the interests of clarifying learning tasks formulating learning strategies and indicating learning paths to assist employees in filling
shareholders the company and incentive recipients. in gaps in their knowledge and honing their professional abilities.Kingfa has taken initiative to train 5 State Council Special Allowance Experts and 2 academic reserve candidates
fostering exceptional talent on behalf of both the company and society. Many new arrivals also benefit from the
company's multi-level talent training system and gradually grow into the backbone of the company's development.Employee Development
Kingfa's emphasis on employee development is the reason that our company has seen continuous improvement
and the key to our future success. We empower staff through a series of employee training programs our E-learning
platform and on-the-job opportunities for formal education.Key Achievements of 2022
Proportion of employees received training: 100%
Swordsmith Program TOP Program Powerful Eagle Program
81 822022 Environmental Social and Governance Report
5 systems of key personnel training Top 10 projects
Top programs Shining Sword
for directors and "Top" series
executives (senior leadership)
Program
"Sword" series
(Marketing Sword Sharpening
Powerful Eagle personnel) Program
Program Swordsmith
Brilliant Eagle Program
Program "Eagle" series
(Middle and junior Creative Thinking
Soaring Eagle leadership) Program
Program "Creative" series
(Technical Creative Making Young Eagle
Program personnel)
Program
Management System Training Site Total Quality Management Practical Application
Creative World
Program
Fine Craftsman
"Craftsman" series Program
(Manufacturing
personnel) Craftsman
Program
Taking Responsibility and Giving Back to Society
General leadership series Professional abilities series
Kingfa training system As a responsible corporation Kingfa follows a public welfare philosophy of "harnessing the potential of manufacturers
shaping industry trends and implementing industry improvements". Kingfa regards societal benefit as the basis for
company growth shoulders the duty of giving back to the country through industry development and courageously takes
External Training on our responsibility to society. We are actively involved in charitable programs including scholarship funds poverty and
disability relief rural revitalization and disaster relief. The "Kingfa Volunteers" a company team with over 60 members
High quality external training can help employees to quickly understand cutting-edge theories and methods in provides volunteer services through a "voluntary + job rotation" operating model.the industry. Kingfa invites external experts from a variety of fields to provide employees with training on a diverse
range of topics such as industry development trend analysis new industry regulations industry knowledge and
technological sharing. We also provide 30000 to RMB 2 million of scholarships for academic education (MBA/MPA/
EMBA) to managerial and senior staff who have worked with us for a certain number of years.External Training for Quality Department Staff
In 2022 Kingfa invited external experts to provide our Quality Department staff with training on a broad range
of subjects including ISO Management Systems and Tech Popularization of the Auditing Process in the German
Automotive Industry ensuring that employees in the Quality Department could quickly grasp new industry
regulations and guarantee product quality. Donations to Build Hope Primary School in Jinxin RMB 30000000 in Donations to Build National Hope
Hunan School in Yangchun City
8384
Multi-skill development training2022 Environmental Social and Governance Report
Rural Revitalization
With the posture of an industry leader Kingfa actively supports poverty alleviation and rural revitalization. Our
company centers on a rural revitalization strategy helping the governments of Guangdong Province and Guangzhou
City in joint efforts to assist in poverty alleviation and wealth building in certain impoverished areas and villages.Over the past five years programs for new rural construction poverty relief workshop construction and village
collective industry development have been launched in more than ten villages and over RMB 50 million in donations
have been provided benefiting over 200000 impoverished persons in Guangdong Province.RMB 2000000 in Donations for Poverty Relief Fund to May 12 Donations to Charities & Foundations
Support Shuimei Village Service Improvement Project Poverty relief - Batang County
In 2017 Kingfa donated RMB 300000 to the Finance Bureau of Batang County Sichuan Province. The funds were
allocated to help in the construction of a primary school and provide books to more children creating opportunities
for students to learn more and broaden their horizons. In the years that followed Kingfa has continued to provide
financial assistance to Batang County helping to create programs that alleviate poverty and build wealth. In 2020
Examples of Charity Awards Earned Batang County removed the "poverty hat" and embarked on a new stage of development. To steer Batang County
to continue down the path of positive development following poverty alleviation Kingfa made further donations of
RMB 300000 for local industry development in 2021 and 2022 respectively.Environmental Public Welfare
To raise environmental protection awareness among consumers since 2021 Kingfa has joined hands with Unilever and other
renowned enterprises and charitable organizations to engage in environmental protection in Qinghai Province through a program
called "Protect Sanjiangyuan and create a cleaner tomorrow". Held at Sanjiangyuan this plastic cleanup is a practical action to
Campus Donations care for the environment around the headwaters of three of China's major rivers and to contribute to the cleanliness of those rivers.Following the cleanup the plastic collected in Sanjiangyuan is shipped across vast distances back to Kingfa where it is transformed
through pre-processing and high quality reclamation providing both environmental and economic benefit.Kingfa collaborates with several institutes of higher learning
such as South China University of Technology Beijing
Institute of Technology and Beijing University of Chemical
Technology to provide students with financial support for
professional study and extracurricular activities. We have
established the "Kingfa Scholarship" for higher education
which encourages students to learn and explore within
their professional fields. We also support campus activities
and programs which offer opportunities for exciting
extracurricular activities such as the "Beijing University
of Chemical Technology Cultural Festival" and "Zhejiang
University Exceptional Engineer Leadership Training". As of
the end of the Reporting Period Kingfa has donated a total
of RMB 6.4 million in scholarship funds. "Kingfa Scholarship" Award Ceremony "Protect Sanjiangyuan and create a cleaner tomorrow" Environmental Protection Campaign
858605
Forging Partnerships to
Facilitate Industry Flourishing
Kingfa works with our partners to create value and is devoted to building the industry community. We deepen
sustainable management in the supply chain to respond to greater complexity in the market environment and a
variety of challenges. In addition we remain committed to the development of both the enterprise and the industry
integrating the industry's upstream and downstream resources. We build a collaborative industry platform and
implement an industry-university-research approach to innovation to promote optimization and improvement
throughout the entire industry chain.Key Achievements of 2022
Proportion of suppliers verification on Number of supplier representatives who attended
site (modified plastic sector): 21% the Supplier Conference: 973
Proportion of strategic suppliers (modified Number of suppliers with transaction records
plastic sector): 8% in 2022: 3311
Number of current standards participated Investment in scholarships for higher education:
formulating: over 160 RMB 1170000
Contributing to the UN SDGs2022 Environmental Social and Governance Report
Collaboration for Common Benefits Safety Sustainable Purchasing
and Efficiency Based on relevant national regulations and the principles of sustainable procurement Kingfa has formulated rules
such as Regulations for the Management of Supplier Introduction and Auditing and Management Regulations
for Supplier Overall Performance which clarify the responsibilities and requirements of departments that conduct
supplier introduction auditing and daily management tasks. This creates a supplier management system that
To continually optimize and improve supplier management Kingfa has established a robust system for management of ensures information transparency and adopts standardized processes.suppliers throughout their life cycle. We closely monitor the creation of quality and non-quality systems by suppliers mobilize
our resources to empower suppliers improve the efficiency and flexibility of the supply chain and ensure that enterprise
operations remain smooth. In 2022 Kingfa was included on a list of "National Exemplary Enterprises in Supply Chain Innovation Supplier Introduction
and Application" jointly selected and evaluated by 8 departments including the Ministry of Commerce of China.Kingfa adopts an open door policy towards supplier introduction. Any supplier that meets the operating requirements
Through our "One platform three systems" management model Kingfa achieves the dynamic management of supplier may register. After passing the auditing process they become reserve suppliers. This lays a solid foundation for the
introduction operations and output processes. We establish different supplier introduction regulations and daily management management of resource supply reserves for major sectors. To ensure the sustainable development of the modified
methods based on the requirements of different categories which are supplemented by a withdrawal mechanism that achieves plastic business modified raw material suppliers must pass rigorous quality and non-quality system auditing before
survival of the fittest in supply resources. This ensures that business management is visible and transparent. being added to the list of approved suppliers.Resource reserves review + Establish differentiated Focus on R&D and order demand
on-site audit of introductory supplier introduction
stage; daily risk warnings standards based on M aterial evaluation + on-site audit + signing of
(credit risks financial categorized management to Material technical agreement
risks quality risks and Risk Supplier conduct initial screening of certification
delivery risks) agreement management introduction suppliers and meet the needs Demand drivenprocess
guarantee (technology and control management mechanism system of resource reserves and Raw material E fficiency improvement
quality environment social optimization supplier
responsibility integrity regularization
commerce supply etc.) Supplier process Supplier evaluation (+ signing of agreement)
Coordination performance
mechanism management Establish differentiated Supplier Output supply resource library for different
Supplier conferences system performance rules and certification categories
technology exchange daily Supplier performance application
process
business communication classification scenarios according to the R educe supply risk
(combining annual planning management management needs of
system
to formulate monthly plan) different sectors to achieve Reserve supply resources
quality communication differentiated display of
platform interaction supplier value
Combine supplier performance and category management Supplier Classification Management
strategy to formulate supplier category rules and differentiated
management measures for strategic suppliers bottleneck In 2022 we conducted classification management on 456 modified material suppliers enacting different kinds of
suppliers collaborative suppliers and general suppliers enabling supplier management measures and establishing targeted daily communication plans with strategic and bottleneck
precise distribution and effective integration of resources suppliers. We also integrated the goals of standard suppliers to promote the continual optimization of supplier
resources.Supplier management platform
89 902022 Environmental Social and Governance Report
Strategy formulation Annual Auditing Results of Modified Plastic Sector Suppliers
over the Past 3 Years
Classification Classificationesults Formulation of supplier Strategy evaluation analysis portfolio strategy and publication
Supplier audits Unit 2020 2021 2022
January …… June …… September October November December
Suppliers which did not fully pass
Num 114 129 149
Strategy Review and adjustment Evaluation of benefits annual audits
implementation of strategy results of strategy review Suppliers which reformed areas of non-
Num 72 112 98
conformance
1 Materials strategic 2 Supplier relationship 3 Supplier relationship Reform rate % 63 87 66
importance analysis analysis segmentation
Suppliers which were paused/
H H Num 2 0 7terminated due to non-conformance
Key T C C S
Kingfa Mutual
Bottleneck Key Bottleneck T T C C Potential suppliers rejected due to non-benefit benefit Num 30 20 31
conformance
Leverage
Low T T T C
Conventional Benchmark Supplier mutual benefit Conventional T T T T
benefit Kingfa worked with a total of 6136 suppliers as of the end of the Reporting Period of which domestic suppliers
L H L H Low Supplier Kingfa Mutual
mutual benefit benefit benefit accounted for 90%. Over the past 3 years we have gradually increased the volume of raw materials procured from Importance of purchase Supplier benefit
expenditure benefit domestic suppliers continuing to localize raw materials and reduce procurement costs. In addition year upon year
we have continued to lower the percentage of raw materials purchased from our top 20 raw material suppliers
effectively distributing the supply risk and ensuring the quality of goods and materials.Modified Plastic sector suppliers according to Procurement from raw material suppliers as a
region percentage of total raw material procurement
Strategy
Supplier
Foreign suppliers 64% 75% 59% 77% 51% 81%
10%
Bottleneck supplier
Collaborative supplier Domestic suppliers
90%
202020212022
General supplier
Domestic suppliers Foreign suppliers Top 20 raw material Domestic raw
suppliers material suppliers
Supplier classification management
9192
Kingfa benefit
Supplier classification management measures
Business importance2022 Environmental Social and Governance Report
Enabling Suppliers Kingfa and Clariant Chemicals Globalization Strategy Collaboration
Kingfa strives to help suppliers improve their abilities
and develop in a coordinated way. We maintain close Since the beginning Kingfa and Clariant Chemicals
communication and relationships with our partners by have maintained a close commercial partnership
holding supplier conferences and offering supplier training and engaged in technological exchange establishing
working hard to create mutual benefit. cutting-edge product testing mechanisms for the
additives industry which are honest and trustworthy.Kingfa hosts an annual supply conference the agenda of Over the past two years we have further expanded
which includes an economic forum procurement special in-depth collaboration in the catalyst sector. Both
topic reports technology and quality special reports and parties have signed an agreement to establish a
an awards ceremony and banquet. In November 2022 we global strategic partnership deepening business
convened an online supplier conference based on the theme collaboration in the catalyst business for the
of "Mutual benefit safety and efficiency". Representatives Kingfa and Clariant Chemicals Strategic Partnership modified plastic and green petrochemicals sectors
from 973 suppliers around the globe attended the event Agreement Signing Ceremony creating mutual benefit on a global scale.joining the effort to create sustainable development. Kingfa 2022 Annual Supplier Conference
To meet the needs of technological innovation we have strengthened our multi-dimensional collaboration with Technological Exchange between Kingfa and ExxonMobil
suppliers implementing multiple dimensions of total technological innovation.Through a united lab platform Kingfa and
Ex xo n M o b i l l e v e ra ge o u r a d va n ta ge s i n
China Jushi and Kingfa Technological Collaboration Partnership fundamental research and application evaluation.Each year we host a large technological exchange
In June 2016 China Jushi and Kingfa formed a technological collaboration partnership which aims to encourage conference where brainstorming and creativity
high-tech talent and develop cutting-edge products within the industry. Our tech innovation strategy continuously collide. The focus is on the development of future
accumulates breakthroughs in international technology allowing both parties to ascend to the peak of the new technologies sharing developmental trends in the
materials industry and become mainstay suppliers within the global new materials sector. new material's market and ranking the importance
of innovation requirements to create a detailed
development plan for review and implementation. Kingfa and ExxonMobil Technological Exchange
To ensure that procurement requirements for quality cost and delivery schedule are met we continue to promote
programs to improve the capabilities of suppliers and actively provide suppliers with assistance. For example we
offer suppliers quality improvement training. If suppliers encounter bottlenecks related to the introduction of new
raw materials or daily management Kingfa stations on-site professionals at supplier factories to conduct training in
essential operations and quality management - achieving lasting results by "teaching our partners to fish".
2021 Jushi Foundation Awards Ceremony
93 942022 Environmental Social and Governance Report
Kingfa Helps a Supplier Continuously Improve Product Quality Stable Supply Chain
To improve supply chain stability Kingfa utilizes the full potential of system management and strategy
A new materials technology company that supplies Kingfa with functional masterbatch materials was struggling optimization to ensure that our supply chain remains stable and secure. We establish an in-depth global
with numerous quality issues due to factory relocation and the turnover of management personnel. When the collaborative supply system with "intercommunication of information resource sharing stable supply and
supplier was unable to properly rectify the situation on their own Kingfa responded rapidly by visiting their rapid response" mitigating the risk of rising supply costs and reduced production capacity.company and providing feedback on areas that needed improvement. Within 3 months the supplier improved
product quality. The assistance was effective.Supplier evaluation Establishing warning mechanisms Risk factor recognition
A materials technology company faced major quality issues with masterbatch
From 2021 to 2022 supply and cut prices by over RMB 70000. We control the risks of suppliers Establishing a warning W e closely follow global political
from the introduction stage by mechanism for high risk military economic and climate
Kingfa visited the company and provided two weeks of quality management strictly evaluating upstream materials developments around the
In August 2022 assistance imparting quality awareness. In August and September there was a supply capabilities bringing in world to identify risk factors and
noticeable drop in problems related to product coloring. suppliers that offer better supply Kingfa establishes in- create risk contingency plans
guarantees depth supply chain control and rapidly adjust procurement
Kingfa investigated the company's upstream manufacturer and trained the
In September and Suppliers undergo annual by continuously tracking
and inventory strategies taking
October of 2022 company to use colorimeters during masterbatch production effectively
measures such as increasing
routine audits. Suppliers who the parking production
controlling product quality. raw material reserves locking are evaluated as having a supply scheduling and manufacturing raw material supply orders
risk are immediately replaced circumstances of over 100
In November and The company had rectified masterbatch appearance issues and supply quality upstream polyolefin producers. and preparing for raw material with new suppliers to minimize
December of 2022 was stabilized. replacementsupply risks
Kingfa's measures to ensure supply chain stability
Teaching Quantitative Methods to Inspect Color Differences
In addition we also strive to improve environmental protection awareness among suppliers. In July 2022 Kingfa
hired lecturers from third party organizations to provide regulatory environmental and material training. Over 90
suppliers participated in the training and a test was administered after the training to assess training results.
95 962022 Environmental Social and Governance Report
Industry Collaboration for Growth Together Strengthening Strategic Partnerships
Kingfa leverages our enterprise advantages to actively engage in education fostering partnerships with learning
institutions and deepening strategic partnerships in the upstream and downstream industry chain. The collective
Innovation partnership and sharing in the development environment help nourish Kingfa's sustainable strength enables us to overcome challenges in applying industrial technology ultimately benefiting society.development. To provide mutual benefit to our industry partners we have established an industry exchange
platform strengthening strategic partnerships with stakeholders such as upstream and downstream enterprises and Fostering Industry Talent
research institutes to create a more sustainable supply chain in the chemical industry.Kingfa is guided by the needs of industry development. Our objective is to provide impetus for higher quality
employment. To achieve this we actively promote in-depth collaboration among the industry universities and
Facilitating Industry Advancement research institutions assemble exceptional technological resources and accelerate the industrialization of the results of scientific research. In June 2022 Kingfa's joint program with Guangdong Electronic - Commerce Technician
College the "Guangzhou advanced materials industry employment training infrastructure program" was approved.To promote collective industry building we fully utilize Its purpose was to promote collaboration between the enterprise and university throughout the entire process build
Kingfa's brand influence and leadership participating a community for school and enterprise development and train "new craftsmen" who are accustomed to the new
in the formulation of over 160 international national technologies formats and career development requirements of the polymer materials industry effectively achieving
industry local and group standards. In addition we "talent for enterprises skills for students and development for universities".actively attend industry conferences in the household
appliances electronics and IoT industries to achieve We established scholarships for majors in materials science chemistry and polymers at the South China University
collective development and mutual benefit. Through of Technology Beijing Institute of Technology and Sun Yat-sen University. At Kingfa we launched an internship base
technological exchanges with globally renowned and organized exchange tours with universities fostering high-quality talent and driving high-quality development in
companies like Shneider Electric Kingfa has established the industry. In 2022 Kingfa offered a total of RMB 1.17 million in scholarships.smooth communication channels with international
customers creating opportunities for our company's
globalized operations and the export of domestic Kingfa & South China University of Technology Golden Eagle Internship Program
products and enriching global technological resources. In October 2022 Kingfa Conducted Connector Materials
Technology Exchange in Germany with Clients Kingfa launched an internship program in collaboration with South China University of Technology arranging
for polymer materials major undergraduates to engage in 4-week practical internships at Kingfa. Interns get
hands-on experience in the Product Research and Development Center Procurement Department and other
Kingfa Attends the ATC Automotive Interior Design Tech Week - departments. In addition department teachers offer one-on-one instruction equipping students with a solid
Automotive Smart Cockpit and Seat Tech Forum foundation that will benefit their future careers.In September 2022 Kingfa joined the ATC Automotive
Interior Design Tech Week - Automotive Smart Cockpit
and Seat Tech Forum discussing new automotive
seat technologies with major original equipment
manufacturers (OEM) and automotive seat companies.During this session we released the keynote speech Kingfa & South China University of Technology Golden Eagle Internship Program (2nd term)
"Kingfa automotive seat system materials total solution"
and participated in the elite closed-door summit round
table discussion on smart interior decoration giving Coordinated Upstream and Downstream Development
customers the opportunity to learn more about Kingfa's
technological abilities in terms of automotive seating. Through our powerful influence and extensive reach Kingfa drives the cooperative development of technological
Automotive Smart Cockpit and Seat Technology Forum innovation and industrial collaboration throughout the industry chain. We also engage in the design manufacture
and implementation of green products to build more resilient industry and supply chains.
97 982022 Environmental Social and Governance Report
Kingfa Carbon Fiber and BYD Jointly Declared the Program of "High Integration Lightweight Kingfa Was Named “Exceptional Supplier of the Year” by Dongfeng
Driving Battery Protective Plate Key Technology Development and Applications" Nissan for Two Consecutive Years
Kingfa continuously provides Dongfeng Nissan with high quality products and services earning a full QCDDS
material product score throughout the year. We also actively and rapidly respond to Dongfeng Nissan's needs
helping the partner ensure raw material
supply. In addition Kingfa has perfected our
During one year of partnership Kingfa Carbon Fiber
material certification planning promoting
and FinDreams Battery completed materials testing
monthly technical meetings and holding
program design and development and advanced
"Brand transformation" marketing events
molding process development for the driving battery
taking cooperation to a new level for both
protective plates used in new energy electric vehicles
parties. Because of Kingfa's outstanding
produced by BYD. The product was successfully mass
performance as a strategic partner Dongfeng
produced and helped BYD in the global launch of its
Nissan named us the "Exceptional Supplier
first CTB Seal model vehicle in March 2022 creating the
of the Year" for two consecutive years in 2021
industry-leading vehicle with the highest under-vehicle
and 2022.safety rating in the industry.In 2022 this program
won the "Gold Award in Forward Thinking" at the 7th Kingfa was Named "Exceptional Supplier of the Year 2022"
Lingxuan China Automotive Awards. by Dongfeng Nissan
In addition we began a partnership with third-party inspection testing and certification organizations to focus on
the mass utilization of renewable energy and cleaner low-carbon conventional energy. Kingfa actively works towards
7th Lingxuan China Automotive Awards the global development strategy of energy conservation green development and renewable energy research
"Gold Award in Forward Thinking" 2022 helping the global energy transition.Kingfa and DEKRA Partnership
“Brand Transformation and the Amazing Benefits of Kingfa” - Dongfeng Nissan's Kingfa and DEKRA have begun a partnership
Brands Nissan and Venucia Began a Strategic Partnership with Kingfa i n p h o t o v o l t a i c m a t e r i a l s g r e a t l y shortening the time spent on transporting
samples and waiting for test results. This
On May 15 2021 to mark the beginning of a strategic partnership with Kingfa Dongfeng Nissan's subsidiaries increases product certification rates and
Nissan and Venucia held a ceremony under the theme of "Brand transformation and the amazing benefits improves product competitiveness in the
of Kingfa" at Kingfa's Qingyuan base. In recent years we have continually improved bilateral collaboration market. In 2019 our Analysis and Testing
mechanisms expanded our partnership improved the QCDDS service system promoted the use of green Center received DEKRA's Witnessed Lab
recycled materials and optimized lightweight and low carbon designs. We provide Dongfeng Nissan with cost- Qualification for raw materials used in solar
effective customized material solutions and have achieved mutual benefit by supplementing each other's energy products. In 2021 two photovoltaic
strengths sharing resources emphasizing practical results and developing in unison. materials produced by Kingfa passed
DEKRA's certification providing powerful In 2019 Kingfa's Analysis and Testing Center Received DEKRA's
support for the f iercely competit ive Witnessed Lab Qualification for Raw Materials Used in Solar
international market. Energy Products
9910006
Building Sustainable Growth
through Ethical Operations
Kingfa operates with honesty and complies with regulations. We strictly follow the code of business ethics and
actively create a system of enterprise operation which abides by legal regulations and the ethical standards of
business. We are committed to implementing the company's mission of "providing society with the best products
and most satisfying services" through compliant and efficient management.Key Achievements of 2022
Whistleblowing of internal/external stakeholders： Completion rate of internal audit rectification：
0times 91%
Contributing to the UN SDGs2022 Environmental Social and Governance Report
Driving Excellence through Shareholder Meetings
Standardized Operations The Kingfa's shareholder meetings are convened strictly in accordance with the requirements outlined in the Company law Rules of Procedure for Shareholder Meetings of Kingfa Sci. & Tech. Co. Ltd. and Articles of Association. We conduct
appropriate procedures for convening and voting ensuring the presence of all shareholders at meetings and enabling
them to fully exercise their rights to inquire and vote on decisions. In 2022 5 shareholder meetings were convened and a
Exceptional enterprise management is a strong guarantee for Kingfa's sustainable development. Kingfa engages in total of 15 motions were deliberated.high-efficiency operations that strictly comply with laws regulations and other normative documents including the
Company law Code of Corporate Governance for Listed Companies and Rules Governing the Listing of Stocks on Board of Directors
the Shanghai Stock Exchange building and continually improving the company's internal management system and
enterprise management level. Kingfa strictly follows the processes outlined in the Company law and Articles of Association to elect directors
and acts in accordance with relevant legal and regulatory requirements. The Kingfa's Board of Directors operates
four sub-committees namely the Nomination Committee Remuneration and Appraisal Committee Strategy and"Triple Meeting” Operations Sustainable Development Committee and the Auditing Committee providing the Board of Directors with expert
opinions and support to assist in decision making. In 2022 the Board of Directors convened 7 meetings and a total
of 35 motions were deliberated.Kingfa has established a sound triple-meeting operating mechanism which continuously improves the policy authorization
system that includes meetings of the shareholders Board of Directors and Supervisory Board. This achieves high-efficiency
collaboration and reciprocal checks and balances between the mechanisms of power policy and supervision. To protect the Supervisory Board
legal interests of shareholders and creditors and standardize the company organization and operations Kingfa periodically
updates and improves governance documents such as the Articles of Association Administrative Measures for Changes in The Kingfa's Supervisory Board strictly carries out the duties outlined in the Rules of Procedure for the Supervisory Board
Shareholdings of Directors Supervisors and Senior Management Internal Reporting Policies for Critical Information and periodically convening Supervisory Board meetings and engaging in the supervision and inspection of duty performance
Administrative Measures for Information Disclosure which are available on the company's official website. by directors and senior managers as well as company finances helping to protect the interests of the company and its
shareholders. In 2022 the Supervisory Board convened 7 meetings and a total of 23 motions were deliberated.Shareholder meetings
Independence and Diversification of Board of Directors
Supervisory Board
Kingfa attaches importance to the independence at the Board of Directors level and has formulated and periodically
Board of Directors updated the Independent Director Operation System. In 2022 the Board of Directors consisted of 11 members 4 of
whom were independent directors. Independent directors make up the majority of members and act as conveners in
Board Secretary the Auditing Committee Nomination Committee and Remuneration and Appraisal Committee. We are committed to
further increasing the proportion of independent directors and strengthening the internal restraints and supervision
on the director and management level.Strategy and
Remuneration
Nomination Sustainable Auditing While strengthening the independence of the Board of Directors Kingfa also attaches importance to ensuring
and Appraisal
Committee Development Committee the diversity of board members. We firmly believe that having directors from a variety of backgrounds is crucial
Committee
Committee for effective supervision of company management and operations. Such diversity allows for assessing risks and
opportunities associated with the company business models from multiple perspectives and fostering a fair
inclusive and open company culture. As part of the director nomination procedure the Nomination of Committee
Triple-meeting operating mechanism ensures that directors are selected from a diverse set of backgrounds by taking multiple factors into consideration
including but not limited to specialty age and gender.
103 1042022 Environmental Social and Governance Report
The Diverse Backgrounds of Board of Directors Members Risk Identification and Management
Polymer
Name Gender Age Role Economics Finance Law
materials Kingfa actively engages in risk identification and management by recognizing analyzing and evaluating risks
Chairman of the at our headquarters subsidiaries and branches. We use tools such as the risk database to record report and
Yuan Zhimin Male 61 Y
Board manage medium and high level risks. In 2022 Kingfa identified a total of 164 risks related to finance law
contracts the market and operations. While identifying risks we utilize the risk database as a management tool
Director General
Li Nanjing Male 60 Y Y to bring risks under control effectively guarding against and dismantling the impacts of major risks on healthy
Manager company development.Xiong
Female 58 Director Y
Haitao
Li Jianjun Male 59 Director Y Business
segment self
Ning evaluation of
Male 49 Director Y
Hongtao risks
Director Vice
Wu Di Male 38 Y
General Manager
Risk control
Director Vice Promoting
Chen Pingxu Male 40 Y center risk
General Manager risk analysis and
rectification
Independent evaluation
Yang Xiong Male 56 Y
Director
Xiao Independent
Male 53 Y Forming
Shengfang Director a risk
Independent database
Zhu Qianyu Female 47 Y
Director
Meng Independent Risk identification process
Male 59 Y
Yuezhong Director
Risk Warning System
In addition to strengthening risk management Kingfa adopts measures that focus on technological
Identifying and Controlling Risks advancements. To avoid risks the company has expanded the scope of our risk investigation and built
up a dynamic cycle warning system. Based on the uniqueness and pervasiveness of risks that have been
identified we investigate and review similar risks that may affect other departments identifying risks that
Kingfa has established a risk control center and formulated the Group Risk Management and Warning Plan which trigger the risk warning conditions and requesting the responsible parties rectify those risks in a timely
identifies and confirms risks from the external environment company level and business level. We have also manner.created a group risk library and risk warning mechanism clarifying closed-loop risk operations and risk prevention
processes.
105 1062022 Environmental Social and Governance Report
To ensure the healthy development of our company's operating activities and guarantee that there are
Dynamic Cycle Warning System Assists in Credit Control no infringements on the legal rights and interests of any shareholders Kingfa has formulated the Internal
Audit Policies in accordance with laws and regulations such as the Audit law of the People's Republic of
China and National Audit Office Regulations on Internal Audit which also takes into account the company's
Continuous risk identification and warning serve as a useful credit control tool for Kingfa. Take credit
realities.management for example. Having identified risks for certain business departments we improved the risk
parameters configuration of the existing risk warning system which lowered the occurrence of overdue
receivables by 9 percentage points increasing the turnover rate by 0.9 times and improving loan quality. We periodically review and evaluate our company's operating and business activities to discover problems
as quickly as possible and fill in gaps in management. Each year Kingfa's audit team creates an annual
audit plan based on our company's internal control needs and audit priorities. It then conducts audit
Building and continuously improving Kingfa's customer information database is key to responding to overdue
projects to assess the effectiveness of internal operational management and evaluate operational risks. As
receivables warning system. We established an internal interface to retrieve data of transactions and payment
of the Reporting Period Kingfa has completed multiple internal and external audits and rectified 102 items
collection from the ERP system and built an external interface for third-party platforms to improve information
– a rectification rate of 91%.about customer business legal disputes and the status of operations. Based on these two interfaces we drew a
regional risk map using customer key indicators forming a picture of customer credit evaluating their risk level
and taking appropriate measures to mitigate risks. Kingfa advocates for a business philosophy which upholds honesty and trustworthiness and aims to
build an incorruptible and transparent business community. To this end Kingfa has formulated the
Administrative Measures on the Receipt of Gifts in Business which clarifies the duties and responsibilities
Key indicators
warn responsible of the company and employees in terms of compliance and guarding against bribery and corruption. Kingfa Low risk
ERP system Legal Calculate personnel continually improves internal whistleblowing mechanism and whistleblower protection mechanism. We proceedings the
Financial probability Evaluate risk Pause manufacturing and
have set up an email address for receiving reports from employees 24 hours a day. We also strictly protect
Database data and level Medium risk shipments collection
Resume
business the privacy of whistleblowers to prevent any retaliation on them.exposure letters and demand letters
Third party Overdue
of risk
frequency occurrence Start legal proceedings
platform High risk establish a dedicated Kingfa has established a compliance and business ethics training system that covers all employees.Amount of processing team Marketing and financial affairs staff are required to receive training on the prevention of corruption
credit sales
bribery and money laundering. We also periodically provide Securities Department staff with training on
new regulations of the China Securities Regulatory Commission. Kingfa actively holds on-site compliance
training at each operations office the content of which covers topics such as local legal regulations the
company's compliance standards code of ethics and more.Compliant Operations Transparent To ensure that the corporate compliance management system abides by high standards high requirements
Disclosure and remains up-to-date Kingfa has introduced the Compliance Management System Requirements and Usage Guidelines (GB/T35770-2022) as the standard for corporate compliance management. This
will effectively reduce the risk of overlapping corporate responsibilities inefficient management and
disorganization and further contribute to resource support the deployment of managers continual
company improvement informatization the creation of a culture of compliance and the establishing of
Kingfa firmly maintains the bottom line of compliant operations by strengthening auditing supervision functions compliance reporting mechanisms.abiding by business ethics and continuously improving the information disclosure system. These measures help us
to enhance operational compliance.Protecting Intellectual Property Rights (IPR)
Compliance and Business Ethics
Kingfa steadfastly follows the path of sustainability driven by innovation. We attach great importance to IP
Kingfa has always committed to compliant operations. We firmly follow ethical standards continue to right protection following laws and regulations such as the Patent law of the People's Republic of China
broaden the scope of our compliance system and business ethics conduct internal and external audits and and have established an intellectual property office. Kingfa is committed to protecting achievements in
employee compliance awareness training. In addition we resolutely oppose all forms of corruption and technological innovation guarding against patent risks and strengthening patent operations.bribery to protect the rights and interests of the company and our stakeholders.
107 1082022 Environmental Social and Governance Report
Information Security
Strengthening Guarding Augmenting In the information age of today events like information leaks and network attacks are regular occurrences. Kingfa
protection against risks operations attaches great importance to information and data security. In 2018 we founded a professional information security
team and established 3 phased objectives to improve the company's information security: "visible" "controllable"
and "trustworthy". In 2020 Kingfa achieved its "visible" objective possessing improved risk discovery and
monitoring capabilities. In 2021 we established multiple defense systems that can effectively control risks achieving
the objective of "controllability". As of the end of 2022 Kingfa possesses the ability to conduct our own security
Intellectual property All-round patent tracking and Use of multiple patent operations and has essentially achieved the objective of "trustworthiness".awareness training for all warning operating methods
employees
In accordance with Cybersecurity law Information System Multi-Level Protection Scheme (the 'MLPS') and other
Product pre-launch patent Make intangible assets create laws and regulations Kingfa focuses on the three-level requirements of MLPS 2.0 and has conducted security
Actively supporting risk investigation tangible added-value development evaluation and rectification of core business systems such as ERP SRM and OA. An improved
technological innovation management system centered on information production dissemination storage use and destruction effectively
Professional team responds Increase the value and ensures the secrecy completeness and accessibility of information assets offering strong protection of the privacy
C omprehensive high-quality directly to patent risks influence of company patent and data security of Kingfa and all the stakeholders.patent protection work
I nsurance for domestic and
R apid protection of key international patents
technologies (currently the
fastest invention patenting
process takes 28 days from
application to approval)
Kingfa IP right protection measures
Kingfa also operates research and development bases in overseas areas so we care about safeguarding our IP rights
overseas. As a key contact unit of the National Overseas Intellectual Property Dispute Response and Guidance Center
Kingfa actively engages in communication and exchanges with overseas professional organizations to acquire the
most up-to-date information about laws and regulations pertaining to international intellectual property. We are
doing our utmost to protect the company's IP rights overseas.Kingfa and European Patent Office Conduct Exchanges
Kingfa was the first chemical enterprise in Asia to
communicate with the European Patent Office (EPO).On June 25 2021 Kingfa and the EPO convened
their first video conference focusing on patent work
communication during which the keynote speech
"Essential points of chemical patent applications in
Europe" was given. Both parties engaged in in-depth
discussions on the verification of experiment data Patent Work Communication between Kingfa
patent application standards and other topics. and the EPO In 2021 the Government of Shanghai's Huangpu District Organized a Cyber-attack Defense Event Involving 40 Large
Enterprises; Kingfa Ranked 2nd in Terms of Performance
109 1102022 Environmental Social and Governance Report
Division of Employee Transparency
Secure Software Guarantee Life Cycle Management
Authority
Standardized and transparent information disclosure is an effective channel of communication between Kingfa and
Information security testing investors regulatory departments and other stakeholders. Kingfa strictly adheres to the Administrative Measures for the
Adopting the principle of
and maintenance is conducted Information Disclosure of Listed Companies and has formulated the Information Disclosure Management Policies to
"minimizing authority" Kingfa Security software is installed on the
throughout the lifecycle of a disclose information related to company operations and governance in a way that is truthful accurate complete timely
assigns employees varying levels server network user terminal and
program covering design launch and fair. We rigorously carry out the information disclosure duties of a listed company and actively protect the legal rights
of internet access authority and access method layers
operation and maintenance and and interests of our investors and other stakeholders.authority control
removal
As sustainable development has become a common goal pursued by the whole world Kingfa continues to improve
Kingfa information security management measures our ESG information disclosure work sharing information about our sustainable development implementation
and achievements through a diverse range of channels including our official website WeChat public account and
The improved information security awareness among employees plays an integral role in perfecting an enterprise's collaborations with external media. We actively respond to the interests and expectations of Kingfa stakeholders.information security system. Each month we disseminate information security knowledge to employees via our internal
company WeChat account and irregularly offer warnings about critical information security matters impacting the Kingfa has designated the China Securities Regulatory Commission as the announcer of media which meets the
industry. In addition Kingfa requires all employees to receive basic information security training and holds specialized conditions of securities market information and the Shanghai Stock Exchange website as the publisher of company
training on other topics as needed to increase employee awareness of data security and privacy protection. announcements and other information which requires disclosure. The company discloses information on the designated
disclosure media prior to any such disclosure on other public media and press releases or press conferences will not take
the place of company announcements. The following figure shows Kingfa's information disclosure process:
Responsible Securities Securities
Trigger
Department reports Department collects Department
temporary
to Securities relevant data and prepares
announcement
Department information announcement
Information Security Training Securities
Department Chairman of the Board Secretary
submits Board approves reviews
Key Achievements of 2022 announcement
Information security training sessions: 20
Number of attendances of information security training: 8900
Cumulative hours of information security training: 11000
111 1122022 Environmental Social and Governance Report
Appendix 1: GRI Standards Index
Content GRI Standards Content GRI Standards
Setting Clear Goals and Improving
About this Report 2-2、2-3 ManagementSetting Clear Goals and 3-3
Improving Management
Protecting the
Environment for
Message from the Chairman 2-22 Clean Production and Low-Carbon 302-1、302-3、302-4、303-2、303-
a Greener Future Manufacturing 3、306-1、306-2、306-3、306-4
Together
Kingfa at a Glance 2-1、2-6、2-28、2-23 Low-Carbon Offices and Green Lifestyle 306-1、306-2
2-9、2-13、2-14、2-16、2-29、3-1、 Caring for Employees with Equality and 2-7、401-1、401-2、401-3、405-1、Our ESG Approach
3-2、3-3 Inclusivity 406-1、408-1、409-1
People-Oriented for
Features: Make the Best Use of Plastic for a Greener Future 2-28、201-2、305-1、305-2、306-2 Empowering Talents Sharing Value 2-19、404-1、404-2、404-3
Better Lives
Taking Responsibility and Giving Back to
Independent R&D and Inclusive Innovation 2-28 203-1、203-2、413-1
Society
Leading Innovation Striving for Excellence Quality and Collaboration for Common Benefits
416-1、416-22-6、204-1、308-1
Creating a Global Brand Branding Forging Partnerships Safety and Efficiency
to Facilitate Industry
Flourishing Industry Collaboration for Growth
Leading the Market and Serving Customers 417-1、417-2 2-28
Together
Driving Excellence through Standardized
Chemical Safety at the Forefront 403-2 2-9、2-10、2-12、2-13、405-1
Operations
Safety Coming First as Building Sustainable
Safety Management and Responsibility
the Solid Foundation 403-1、403-5 Growth through Ethical Identifying and Controlling Risks 2-25
Allocation
for Operations
403-1、403-2、403-3、403-5、403- Compliant Operations Transparent
Safeguarding Occupational Health 205-2、205-3
6、403-7、403-9、403-10 Disclosure
113 1142022 Environmental Social and Governance Report
Appendix 2: Provincial R&D Centers Feedback
Dear readers:
Hubei Enterprise Technology Center Guangdong Kingfa Engineering Technology Center
Hello!
Hubei Engineering Technology Research Center Zhuhai Kingfa Provincial Key Laboratory
Thank you for taking the time to read the "Kingfa 2022 ESG Report". For the purposes of communication and to
Sichuan Provincial Enterprise Technology Center Zhuhai Kingfa Engineering Center improve Kingfa's sustainable development management and implementation we humbly ask you to complete the
following feedback questionnaire regarding this report.Tianjin City Enterprise Technology Center Kingfa Technology Engineering Center
1. What is your overall rating of Kingfa's ESG report?
Tianjin City Enterprise Key Laboratory Kingfa Technology Provincial Key Laboratory
□ Very good □ Good □ Ok □ Poor
Kingfa Technology New Research and Development
Tianjin City Engineering Research Center
Institution 2. How would you rate the truthfulness accuracy and effectiveness of the information and data revealed in this report?
□ Very good □ Good □ Ok □ Poor
National Advanced Materials Guangdong Engineering
Jiangsu Enterprise Scholar Workstation
and Technology Research Center 3. How well does this report reflect Kingfa's influence on the environment society and governance?
Shanghai Engineering Plastic Functionality Engineering □ Very good □ Good □ Ok □ Poor
Jiangsu Enterprise Technology Research Center
Technology Research Center
4. How would you rate communication with Kingfa stakeholders?
Shanghai Enterprise Post-doctorate Scientific Research
Jiangsu Enterprise Technology Center □ Very good □ Good □ Ok □ Poor
Workstation
5. Are the writing content layout and page format design of the report easy to understand?
Jiangsu Graduate Student Workstation Shanghai Academic Expert Workstation
□ Yes □ No
Guangdong Composite Materials Engineering Center
6. Do you have any comments or suggestions about Kingfa's ESG Report?
Guangdong Kingfa Engineering Laboratory
Please contact us through one of the following methods:
Address: No. 33 Kefeng Road Science City High-Tech Industrial Development Zone Guangzhou
Zip code: 510663
Phone: +86 020-66818881
Email: ir@kingfa.com
Thank you again for your time!
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