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HengyiPetrochemicalCo.,Ltd.122023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.3AboutthisreportOfficialWebsite：/CNInfo：ThisreportcoverstheperiodfromJanuary1,2023toDecember31,2023.Somecontentmaybeappropriatelyextendedbeyondthestatedperiodaccordingtodisclosureneeds.ReportingperiodForbetterpresentationandreadability,HengyiPetrochemicalCo.,Ltd.isalsoreferredtoas"Hengyi",the"Company"and"We"inthisreport.AbbreviationsTheinformationanddatacitedinthisreportcomefromtheofficialdocuments,statisticalandfinancialreportsoftheCompany.ThereportingmaterialsareprovidedbyHengyiemployeesandpartners.It'sonlyfordisclosingHengyi'ssustainabilitymanagementprogressinsteadofcommercialuse.Thefinancialdatainthisreportissubjecttotheannualreportdata.Otherdataisfrominternalstatistics.ThecurrencyusedinthisreportisRMBunlessotherwisenoted.DataSourcesTheBoardofDirectorsoftheCompanyapprovedthisreportonApril19,2024.ThisreportisavailableinbothSimplifiedChineseandEnglishversions.Foranyinconsistencyofthecontent,thesimplifiedChineseversionshallprevail.Youcanvisitourwebsitetodownloadthisreport.ReportAccessThisisthefifthindependentreportreleasedbyHengyiPetrochemicalCo.,Ltd..Inresponsetomarketchangesandnewregulatoryrequirements,thereportnamewouldbechangedfromSocialResponsibilityReporttoEnvironmental,Social,andGovernanceReportsince2023.ThisreportdisclosesrelevantinformationoftheCompanyintheenvironmental,social,andgovernanceaspectsin2023torespondtotheconcernsandexpectationsofstakeholders.OrganizationalScopeThemainentityofthisreportisHengyiPetrochemicalCo.,Ltd.,includingitsbranches,subsidiaries,andaffiliates.PreparationBasisThisreportispreparedinaccordancewiththerequirementsofChapter8"SocialResponsibility"oftheGuidelinesNo.1forSelf-RegulationofListedCompanies-StandardizedOperationofCompaniesListedontheMainBoardofShenzhenStockExchangeandwithreferencetotheGRISustainabilityReportingStandards(GRIStandards)issuedbyGlobalReportingInitiative(GRI),aswellastheUnitedNationsGlobalCompact,ISO26000:GuidanceonSocialResponsibility(2010)issuedbyInternationalOrganizationforStandardizationandtheGuidelinesonCorporateSocialResponsibilityReportingforChineseEnterprises(CASS-CSR5.0)issuedbytheChineseAcademyofSocialSciences.42023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.5AboutthisreportChairman’sStatementAboutHengyiHonorsESGHighlightsin2023030607090901CreatingMutualTrustandValuewithShareholdersCorporateGovernanceESGGovernance1220EarningCustomerTrustwithQuality03SafetyResponsibilityProductQualitySuperiorServices384345FosteringStableandWin-winRelationshipswithPartners04ResponsibleSupplierChainR&DandInnovationIndustryExchangesandCooperation48495405GrowingTogetherwithEmployeesEmployees'RightsandInterestsOccupationalHealthandSafetyUnblockedGrowthChannelWarmcareforemployees5860616306BuildingHarmoniousCommunityWithASharedFutureRuralVitalizationCommunityCharityContributiontotheBRI666667ProspectsAppendix7072727477ESGKeyPerformanceReportContentIndexesFeedbackSheetCONTENTSStrivingforHarmonywiththeEnvironmentbyGreenDevelopment02ClimateChangeResponseEnvironmentalManagementWaterResourceUtilizationPollutantEmissionReductionEcologicalProtection263132333562023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.7Chairman’sStatement2023wasthefirstyearforkickingoffoureffortstoputtheguidingprinciplesofthe20thCPCNationalCongressintoaction.Itwasalsopivotaltoimplementthe14thFive-YearPlan.Amidthecomplexinternationalclimateanddomesticeconomicrecoverypressures,2023wasamixofopportunitiesandchallengesforHengyi.Bolsteredbythecollectivetenacityandunremittingendeavorofourworkforce,Hengyiexcelleddespiteexternalpressures.|In2023|Deeplyrootedinourprimarybusiness,Hengyialignedwiththenationaldirectivesforhigh-qualitydevelopmentandcarbonpeakingandcarbonneutralitygoals,prioritizingtheimportanceofenvironmentalprotectioninouroperations.Embeddingcarbonpeakingacrosseverylinkandfacetofourdevelopment,weexecutedsevencarbonpeakingactions:greenandlow-carbonenergytransitionaction,energy-saving,carbonreductionandefficiencyincreaseaction,greenandlow-carbonactionintheproductionfield,greenandlow-carbonactioninthetransportfield,carbonfootprintreductionactionthroughthecirculareconomy,greenandlow-carbonactionthroughtechnologicalinnovation,andgreenandlow-carbonactionforthepublic,contributingtotheglobalactionagainstclimatechange.Byadvancinggreentechnologicalinnovations,developingcleanenergy,savingenergy,andimprovingenergyefficiency,weexploredourpotentialtoreducecarbonemissionsandcontributetobuildingamorebeautifulChina.|In2023|Hengyifurtherenhanceditstechnologicalinnovationcapacity.CommittedtoindependentR&D,weexpeditedthecommercializationandapplicationoftechnologicalachievementsandnurturednewqualityproductiveforces,propellingthetransitionfromanindustrialHengyitoatechnologicalHengyi.Theproductioncapacityofoureco-friendlypolyesterproduct,Eticont,reached800,000tons,heraldinganewepochinthegreendevelopmentofpolyesterfibers.|In2023|Hengyicontinuedtoperformsocialresponsibilitiesandcommitments.Championingtheconceptof“advancingdevelopmentwithjointeffortsandsharedjoy”,wehostedthefifthCorporateCultureFestivalandlaunchedthefifthroundofourEmployeeStockOwnershipPlan(ESOP).Theplanbenefitedover10,000participantsintotal.Activelyinvolvedincharitableactivities,wedonatedRMB30milliontotheRedCrossSocietyofChinaWuzhongBranch,Ningxia,earningustheinaugural“HangzhouCharityAward”.Lookingahead,Hengyiwillcontinuetopracticethenationalstrategicgoalsofcarbonpeakingandcarbonneutrality.Whilepursuinggreeninnovationguidedbygreenmanufacturingandcirculareconomy,wewillintegrateintothenewdevelopmentparadigmofdualcirculationmoreproactively,embarkingonanewjourneyunderChinesemodernization!AboutHengyiHengyiPetrochemical(000703.SZ)aspirestobecomeaworld-classanddomesticleadingpetrochemicalindustrialgroup.Throughresourcesharingandindustrialcoordination,theCompanybolstersoverallcompetitiveness.Currently,wehaveformedamulti-faceted“petrochemical+”industriallayout,withthepetrochemicalindustrychaindrivenby“polyester+nylon”servingasthecorebusiness,petrochemicalfinanceandtradeasthegrowthbusiness,andbigdataofchemicalfiberindustrychainandintelligentmanufacturingastheemergingbusiness.Foryears,ouroverallcompetitivenesshasmaintainedaleadingpositionintheindustry.Ourmainproductsincludepurifiedterephthalicacid(PTA),caprolactam(CPL),polyethyleneterephthalate(PET)chips,andbottleflakes,aswellasarangeofdifferentiatedproductslikepolyesterpre-orientedyarn(POY),polyesterfullydrawnyarn(FDY),polyesterdrawntexturedyarn(DTY)andshortfiber.Polyesterproducts,integraltoboththeeconomyandeverydaylife,areextensivelyusedintextiles,clothing,homefurnishings,andindustrialapplications.Weleadthesegmentofdifferentiatedandhighvalue-addedproductswithourantimony-free,eco-friendlyEticontpolyesterchipsandfibers,cationicpolyesterchipsandfibers,ultra-highelasticityfibers,rabbitfur-likefibers,special-shapedsilk,colorsilk,masterbatchsilk,Hengyibamboosilk,Hengyidragonsilk,andHengyicoloredsilk.BusinessLayout82023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.9HonorsESGHighlightsin20231.OneofHengyi’sprojectswasselectedintheTop100BestPracticesoverthePastDecadeoftheBeltandRoadCooperationbyChineseListedCompanies3.HengyigotGrade-AininformationdisclosureassessmentbyShenzhenStockExchangefortwoconsecutiveyears4.Hengyiwonthe2023ProductDevelopmentContributionAwardbyChinaNationalTextileandApparelCouncil(CNTAC)5.HengyireceivedtheCarbonNeutralTop50oftheESGGoldenBullAwards6.Hengyiwaslistedamongthebillion-dollarclubrankingsofglobalchemicalcompanies7.Our“GreenManufacturingofTiO2MattingAgentforNylonandCompleteSetofTechnologiesforIndustrializationofFullyMatteNylon”werehonoredtheFirstPrizeofthe2023CNTACScienceandTechnologyProgressAward.8.ChairmanQiuYibowasbestowedas“NewProminentHangzhouEntrepreneur”attheWorldHangzhouEntrepreneursConvention2.Hengyiwasawardedthe“2023ExcellentPracticeCaseoftheBoardOfficeofListedCompanies”byChinaAssociationforPublicCompanies15investorexchangeactivitiesinvariousforms,suchasteleconferences,onsiteinvestorsurveys,brokeragestrategymeetings,andperformancebriefings.Duringthereportingperiod,theCompanyimplementedthethirdandfourthphasesofthesharerepurchaseprogram.Thethirdphasewascompleted,withatotalof150,813,800sharesrepurchased,representing4.11%oftheCompany'stotalsharecapital,andthetotalamountpaidhasreachedapproximatelyRMB1.112billion.AsofMarch31,2024,thecumulativenumberofsharesrepurchasedunderthefourthphasehasamountedto64,575,500shares,accountingfor1.76%oftheCompany’stotalsharecapitaloraroundRMB430millionpaidtoemployees.TheCompanyhasrepurchasedsharesworthapproximatelyRMB2.675billion,demonstratingtheCompany'sconfidenceinitsvalueandfuturedevelopment.RMB521.4955millioninvestedinenvironmentalprotectionRMB139.8686millioninvestedinsafetyApproximatelyRMB4.437billionfor366.84millionsharespurchasedinfiveroundsofemployeestockownershipplanfollowingthisyear’sfifthround.Sinceitsinception,Hengyihasenduredstormswithoutchangingitsoriginalintention,forgedthroughvicissitudesandflourishedinitsprime.Hengyihasdevelopedaunique"54354"corporateculturemechanism,focusingonfivesub-cultures:sharedcreation,dedicationtoexcellence,pioneeringspirit,stabilityandsecurity,andmutualbenefits.Weadheretofourprinciplesof“therealizationofhistoricalexperience,thecollectivizationofindividualknowledge,thehumanizationofrigidinstitutions,andthetacticaltransformationofstrategicblueprints”,aimingforharmonybetweencultureandstrategy,businessgrowthandemployeedevelopment,andculturaladvantageandcompetitiveness.Bybuildingfivedriversystemsofseniorleadership,employeedemand,fullparticipation,socialinteraction,andinstitutionalsecurity,Hengyiaspirestobeacentury-oldenterprisedeeplyrespected,wellreceived,trusted,andlovedbysociety,customers,shareholders,andemployees.HengyiCulturePersistencerewardsthediligent,nobleaspirationsreachfarPhilosophyBuildacentury-old,evergreenfoundationandstandamongtheworld'srenownedenterprisesMissionNeverstopmovingforward,createbrillianceSpiritBecomeoneoftheworld'stop-tierpetrochemicalindustrygroupsVisionPragmatism,responsibility,surpassing,andsharing.Corevalues102023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.11Soundgovernanceisanimportantguaranteeforpromotingefficientoperationandsustainableandrobustoperationofanenterprise.Stayingtruetothemoderncorporategovernancephilosophyofhonesty,trustworthinessandopenness,Hengyipromotestheoverallimprovementofcorporategovernanceandinternalcontrolmanagementandcontinuestocreatevalueforshareholdersandthewholesociety.CorporateGovernanceESGGovernancev2023ActionsandResponsesGrade-AininformationdisclosureassessmentbyShenzhenStockExchange(SZSE)fortwoconsecutiveyears“A”shareholdersmeetings5meetingsoftheBoardofDirectors15periodicreportsissued4investorcommunicationactivitiesconducted15announcementsontheofficialwebsitesofHengYiandSZSEdisclosed,and22111meetingsoftheBoardofSupervisorsheldandValuewithShareholdersCreatingMutualTrust122023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.13CorporateGovernanceTheCompanyiscommittedtobuildingahigh-qualitycorporategovernancestructurewithtransparentrightsandresponsibilitiesandcleardivisionoflabor.WestrictlycomplywiththerequirementsoflawsandregulationsandrelevantregulatorydocumentssuchastheCompanyLaw,theSecuritiesLawandtheShenzhenStockExchangeListingRules,etc.,andfollowuponupdatesoflawsandregulationsinatimelymanner.WehaverevisedtheArticlesofAssociation,theIndependentDirectorsWorkSystemandotherrelevantcorporatesystemstocontinuouslystrengthenourgovernancestandardsasalistedcompany.Fortwoconsecutiveyears,theCompanyhasbeenawardedGrade"A"ininformationdisclosureassessmentbytheShenzhenStockExchange,andtheinformationdisclosurequality,standardizedoperationandinvestorrelationsmanagementhavebeenhighlyrecognized.TheCompanyhasestablishedaninternalgovernancestructurecomprisingtheShareholders’Meeting,theBoardofDirectors,theBoardofSupervisorsandtheseniormanagement.TheBoardhasfourcommittees:StrategyandInvestmentCommittee,CompensationAssessmentandNominationCommittee,RiskControlCommitteeandAuditCommittee.Eachofthesespecializedcommitteesconductstheirdutiesandresponsibilitiestoensureefficient,scientificandstandardizedoperation.GovernancestructureStrategy&InvestmentCommitteeBoardofSupervisorsBoDOfficeShareholdersMeetingBoardofDirectorsSeniorManagementCompensationCommitteeRiskControlCommitteeAuditCommitteeHengyiPetrochemicalCo.,Ltd.Audit&LegalProductionManagementInvestmentHumanResourceInformation&DataOfficeFinanceCapitalManagementSafety&EnvironmentTheShareholders’MeetingisthehighestauthorityoftheCompany.TheCompanyconvenesandholdsthemeetingsinstrictaccordancewiththeprovisionsandrequirementsoftheRulesforShareholders’MeetingofListedCompanies,theArticlesofAssociationandtheShareholders'MeetingRules,andtreatsallshareholdersfairly.TheShareholders’Meetingconductsonlinevotinganddisclosesthevotingofminorityshareholdersintheannouncementtoactivelysafeguardthelegitimaterightsandinterestsofallshareholders,especiallyminorityshareholders,inobtaininginformation,participatingindecision-making,andsupervisingofmajormatters.5shareholders’meetingsheldin2023Shareholders’MeetingTheBoardofDirectors(theBoard),asapermanentdecision-makingbody,isresponsibleforformulatingoverallstrategicplans,settinglong-termperformanceandmanagementobjectives,evaluatingbusinessoperationperformanceandmonitoringmanagementperformance,andscrutinizingrisks,etc.ItisresponsibletotheShareholders'Meeting.ThedirectorsareelectedbytheShareholders’Meetingforatermofthreeyearsandareeligibleforre-election.In2023,the11thBoardofDirectorscompleteditsterm,andtheCompanyelectedthe12thBoardofDirectorsbytheprocedures,tofurtherimprovethecorporategovernancestructure.Afterthedeliberationofthe12thsessionoftheBoardofDirectors,QiuYibowaselectedastheChairmanoftheBoard,andthemembersofthespecializedcommitteesoftheBoardwereappointed.TheBoardhadatotalof9directors,including3independentdirectors,accountingfor33.33%,and1femaledirector,accountingfor11.11%ofallBoardmembers.Themembersallcomefromdifferentprofessionalfields,withgoodculturalandeducationalbackgroundsandrichprofessionalexperience.TheBoardgivesfullplaytotheirbusinesscapabilitiesandfinancialexperience,andconstantlyimprovesthesystemofspecializedcommittees,soastoenhancetheindependenceandprofessionalismoftheBoard,andtovigorouslysafeguardthelegitimaterightsandinterestsoftheCompanyandminorityshareholders.Directors,theBoardandspecializedcommitteesmeetingsoftheBoardofDirectorsheldin202315TheBoardofSupervisorsexercisesitssupervisorydutiesovertheCompany'sbusinessactivitiesinaccordancewiththelawsandregulations,andsafeguardsthelegitimaterightsandinterestsoftheCompany,shareholdersandcreditorsaccordingtotheCompanyLaw,theArticlesofAssociationandotherrelevantregulations.In2023,thetermofofficeofthe11thBoardofSupervisorsexpired,andtheCompanycarriedoutthenewroundofelectioninaccordancewiththeprocedures.The12thBoardofSupervisorsconsistsofthreeSupervisors,includingonefemaleSupervisor.BoardofSupervisorsmeetingsoftheBoardofSupervisorsheldin202311TheSeniorManagement,astheexecutivebodyoftheCompany,isappointedbyandreportingtotheBoard.Afterageneralelection,theManagementcurrentlyconsistsof6seniorexecutives,involvingexpertsindifferentfieldssuchaspetrochemicals,materialscience,production,finance,legalaffairs,marketing,capitaloperation,etc.,withprofessionalcapabilitiesandrichmanagementexperience.SeniorManagement142023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.15RiskandinternalcontrolmanagementTheCompanyadherestocorporategovernanceinaccordancewiththelaw,establishesandimprovescorporatelegalriskpreventionmechanismsandintegratesintegrityandcomplianceguidelinesintoallareasandaspectsofproductionandoperation.Whileimprovingtheinternalcontrolmanagementsystem,weredoubleeffortsinauditingandcontinuetostrengthencompliancemanagement.TheCompanyhasestablishedthemanagementmechanismtosupportstrategyimplementationandriskcontrol,andrefinedriskmanagementcapabilities.ByformulatingtheDevelopmentStrategicPlanningManagementSystem,RulesonAuditCommitteeWorkandRulesonRiskControlCommitteeWork,whichguidetheBoardandtheAuditCommitteetofulfilltheirriskdecision-makingandsupervisionresponsibilitiesandpreventrisksinformulatingandimplementingthestrategicplansfordevelopment.TheInternalControlSystemandtheInternalAuditSystemareadoptedtostrengthentheinternalmanagementandsupervision,aimingtoe。
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nhanceourcapacitiesonbusinessmanagementandriskprevention.Byidentifyingpotentialrisks,evaluatingrisks,andformulatingriskmanagementstrategiesformajorrisks,theCompanyhasimplementedstandardizedriskpreventionandcontrolrequirementsacrossourcorporatemanagementandbusinessprocesses,soastoensurethatrisksarecontainedwithinthescopeofrisktolerance,andtoprovideastrongguaranteeforthesoundoperation.CompliantoperationTheriskassessmentprocessincludesriskidentification,riskanalysis,riskassessmentandriskresponsetoensuretheaccuracyandcomprehensivenessofriskassessment.Allkindsofriskswillberegisteredandevaluatedbasedonresultsfromriskassessment.Theprioritizedrisksandthosethatmayleadtosignificantimpactswillbeidentified.RiskAssessmentTheCompanyregularlyconductsinternalcontrolself-evaluationprogramsandidentifieskeyrisksofactualbusinessprocessesinlinewiththeGuidelinesforCorporateInternalControlandtheinternalcontrolmanual,whichcoversalldepartmentsandformsabusinessprocessriskcontrolmatrix.Throughthescientificriskassessmentmechanism,potentialrisksareidentifiedandforewarnedinatimelymanner,witheffectivemeasurestocontrolanddefuse.InternalControlTheCompanyregularlycarriesoutlecturesonriskpreventionandcontrol,andhiresexternallegallecturerstoconductcompliancetrainingandeducationactivitiesforemployeestoimprovetheirriskpreventionabilityandensurecomplianceintheirdailywork.RiskTrainingFocusingontheCompany'sdevelopment,theauditactivitiesaimto"preventrisks,controlcosts,strengthenmanagement,andpromotestandardization."Targetingkeybusinessareas,suchasfinance,logistics,procurement,sales,productionandrawmaterialsupplyandtrade,adiversifiedauditmodelof"routine,specializedandcontinuoussupervision+spotchecks"isimplementedforauditoversight.SuchmodeensuresthattheCompanycanfullyfulfillourinternalauditresponsibilities,ensuringtheeffectiveimprovementofourriskmanagementlevel.AuditsintheCompany:TheCompanystrictlyabidesbytheAnti-MonopolyLawofthePRC,theAnti-UnfairCompetitionLawofthePRCandtherelevantlawsandregulationsofthecountrieswheretheoverseasprojectsarelocated.Weadheretothecodeofbusinessconductandethics,consciouslymaintainthefairnessandequityofthemarket,andopposeanyformofcommercialbribery,moneylaundering,monopolizationandunfaircompetition.TheCompanyhasformulatedtheCodeofBusinessConductandEthics,theAnti-fraudGuidelines,theEmployeeIntegrityandEthicalConductRegulationsandotherinstitutionaldocuments,andsetuptheanti-fraudworkinggroupledbytheChairman,whoisresponsibleforauthorizinginvestigationsofreportedmattersandmakingdecisionsonthehandlingofcertainemployees’fraudulentacts.Inordertocontinuouslyimprovetheanti-corruptionpreventionandcontrolsystemandreducecorruptionincidents,theCompanyhassetupanindependentauditandlegaldepartmenttocarryoutanti-corruptioneffortsguidedbytheAuditCommittee.BusinessethicsAnti-corruptionPolicyGoalCodeofBusinessConductandEthicsCommittedtotheprincipleof"openness,fairnessandimpartiality",theCompanyrequiresourpartnerstostrictlycomplywithrelevantdomesticandinternationallawsandregulations,aswellasourSupplierManagementSystem,Anti-commercialBriberyandIntegrityAgreement,etc.Wehavezerotoleranceforanyformofcorruptionandbribery,regularlypublicizeourintegritysystemthroughphonecalls,WeChatandemails.Meanwhile,wefullyrespectandprotectintellectualpropertyrightsandbusinesssecretstoestablishfair,equitableandtrustworthycooperation.Promotingallemployeestoabidebyintegrityandprofessionalethics,ensuringcompliancewithlegalandethicalstandards.TheCompanyhasestablishedasoundmanagementmechanismwhichclarifiesthewhistleblowerprotectionandensurestimelyandeffectivehandlingofreportsandcomplaints.Wehaveestablishedasmoothchannelforcomplaintreporting,andallreportingchannelsareopenandaccessiblethroughsystemannouncements,theCompany’sofficialwebsite,ourWeChatofficialaccount,customermeetings,biddingprocessesandtheinternalintegrityeducationanddisciplinarycasenotificationsonaday-to-daybasis.Wepromisetoprotecttheprivacyandinformationsecurityofeverywhistleblower,withoutdisclosingtheiridentity.TheCompanywilltreatthewhistleblowermaterialsasconfidential,strictlysafeguardinganyinformationincludingtheirname,employer,homeaddress,andtheirreportingcontent.Anyformofretaliationagainstindividualswhoassistinwhistleblowerinvestigationsisstrictlyprohibited.Oncediscovered,appropriatemeasureswillbetakenaccordingtorelevantregulations,andanycriminalactivitieswillbetransferredtothejudicialauthorities.WhistleblowerProtectionAnti-FraudGuidelinesEmployeeIntegrityandEthicalConductRegulationsStrengtheninginternalcontrols,preventingfraudrisks,establishinganti-fraudmechanisms,andensuringthecompany'shealthandsustainabledevelopment.Promotingallemployeestoabidebythelaw,maintainintegrityandself-discipline,andadheretoprofessionalethics,preventingcorruptionfromoccurring.162023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.17Anti-fraudOfficereportingchannels:Tel:0571-83581890(ext:1890)E-mail:fwb@hengyi.comFax:0571-82797666Informationdisclosureisanimportantwindowforinvestorsandthepublictoobtaininformationoflistedcompanies,andisalsoabasicrequirementformaintaininguprightandtransparentcommunication.TheCompanyeffectivelyprotectsinvestors'righttoknowandparticipate,establishesamulti-channelandall-roundcommunicationplatformandacommunicationmechanismformajorevents,andregularlyreleasesreportstoguaranteetheaccurateandstandardizeddisclosureofrelevantinformation.TheCompanycarriesoutinvestorcommunicationactivitiesinvariousformssuchasonlineteleconferences,on-siteinvestorsurveys,brokeragestrategymeetings,andperformancebriefings,etc.,andhasdesignatedpersonnelresponsibleforsmoothmailboxesandtelephones,andalsoactivelyrespondstoinvestorquestionsbyutilizingtheinvestorinteractiveplatformofSZSE.In2023,weheld2performancebriefingsatwhichinvestors'nearly200questionswereanswered,andrespondedto87questionsontheSZSE’sinvestorinteractiveplatformtimelyandeffectively,whileactivelyrespondingtoinvestorconcernsviainvestorhotlinesandotherformstoconveytheCompany'svaluetoinvestors.InvestorRelationsInvestorHotlineWeChatofficialaccountSZSEinteractiveplatformOfficialwebsite'sinvestorrelationssectionCommunicationChannelsTheCompanyheldperformancebriefingsTheCompanyheldonlineperformancebriefingeventsthroughonlineplatforms,boostinginvestors’trustandrecognitionbycomprehensivelyandmulti-dimensionallyelaboratingonourbusinessoperation,developmenthighlights,strategicplanning,andsocialresponsibilityetc.Caseand4regularreportswereissued.4In2023,15investorcommunicationactivitieswerecarriedout15221announcementsweredisclosedontheofficialwebsitesofHengYiandSZSEHonorsExcellentCaseofServingtheRealEconomyintheBondMarket,issuedbyShenzhenStockExchange2023ExcellentPracticeCaseoftheBoardOfficeofListedCompanies,Top100BestPracticesoverthePastDecadeoftheBeltandRoadCooperationbyChineseListedCompaniesand4Asecretaryintheevaluationofsecretaries'performanceissuedbyChinaAssociationforPublicCompaniesCarbonNeutralTop50oftheESGGoldenBullAwardsforbyChinaSecuritiesJournal.Among"billion-dollarclubrankingsofglobalchemicalcompanies"releasedbytheUSChemicalWeeklyP5Wperformancebriefing182023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.19FourintegrationandfourenhancementsFourshowcasesandfourcompetitionsSixPartybuildingprojectsTheCompanyintegratesPartybuildingwithproductionandmanagement,corporateculture,humanresources,andsocialresponsibilitytoenhancedevelopmentability,softpower,competitiveness,andinfluence,respectively.Conductingcampaignsforshowcasingouridentify,responsibility,role,andperformanceandcompetinginlearning,skills,cooperation,anddedication,theCompanyfostersaconduciveclimatethatfacilitatesworkthroughstudy,elevatesqualitiesthroughskillcompetitions,enhancessynergythroughteamwork,andnurturespioneersthroughjobdedication.TheCompanyimplementsprojectsforfoundationreinforcement,Party-massco-building,qualityenhancement,advicepresentation,familyculture,andsocialcontribution.ToimprovethedevelopmentofPartyorganizations,theCompanyhasformulatedthe2024-2026DevelopmentPlanforPartyMembers,whichdefinesPartybuildinggoalsandmandatestocreatePartybranchesinapartments,communities,andworkshopsfaster.WeenhanceteambuildingforPartysecretaries,staffresponsibleforPartyaffairs,andPartymembers.WealsoimplementannualassessmentsforPartysecretaries,qualityenhancementsforstaffresponsibleforPartyaffairs,andthoroughauditsforPartymembers,withafocusonbolsteringthemanagementofmigrantPartymembers.Strengtheningtheconstructionofprimary-levelPartyorganizationsDeepeningthesituationeducationcampaignforPartymembersEnrichingcorporatecultureactivitiesTheCompanylaunchestheall-staffsituationeducationcampaignfor“BolsteringConfidence,Morale,Initiative,andDevelopment”throughPartyorganizations.Leveragingactivitiessuchas“ThreeMeetingsandOneLecture”andthematicPartyDay,wetapmechanismslike“Primary-levelPoliticalCommissar”and“HengyiSeniors”.Inaddition,wearekeenonmakingoursituationeducationmoretargeted,effective,penetrating,andaffiliative.TheCompanyconsistentlyrefinesitscorporateculturesystemcenteredaroundtheprincipleof“RelentlessPursuitofExcellence”.WiththesupportofPartyorganizations,wehaveformulatedtheCorporateCultureManual,reshapedcorevalues,designedthemascot“BlueRabbit”,andorganizedacorporateculturefestival.Valuingtheguidingroleofadvancedmodels,theCompanymotivatesPartymembersandorganizationsatalllevelstostaytruetotheoriginalaspirationforrelentlessefforts.Thecampaignon“FourShowcasesandFourCompetitions”andfeaturecoveragesuchas“ContributingtoPartyBuilding”,“CelebratingtheAsianGamesandCarryingFrowardHengyiSpirit”,and“PromotingCulturetoForgeSynergyforProgress”werecarriedout.TogetherwiththeGroup,wehaveissuedanimplementingplanforselectingadvancedcollectivesandoutstandingindividualsinPartyandmassorganizations,fullymobilizingtheworkingenthusiasmofPartymembers.OnecoreideologyThreedemonstrationsAdheringtothecoreideologyof“strengtheningPartybuilding,consolidatingthefoundation,creatingharmony,andpromotingdevelopment”,theCompanystrivestoachievethemulti-winobjectiveof“advancedorganization,outstandingPartymembers,greatenterprisedevelopment,andtangiblebenefitstoemployees”.Aimingtobeademonstrationofscientificdevelopment,reinvigoratingourgrowthwithtalent,andstrivingforexcellence,theCompanymaximizestheguidingandleadingroleofthisgoaltocontinuallyopennewchapterforPartybuilding.GuidedbyXiJinpingThoughtonSocialismwithChineseCharacteristicsforaNewEra,theCompanyactivelyestablishesaworkingpatternfor“BigHengyi,BigPartyBuilding,BigDevelopment”,fosteringaPartybuildingbrandof“StayingTruetoourFoundingMissionontheJourneyofDevelopment”.Thisefforthasledtoaunique“13446”Partybuildingworkmechanism,whichdriveshigh-qualitydevelopmentthroughhigh-qualityPartybuilding.PartyBuilding“13446”Partybuildingworkmechanism:202023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.21MaterialityanalysisBasedontheindustrydevelopmentandbusinessperformance,theCompanyconductsinternalandexternalstakeholdersurveys,identifiesthecoreESGtopics,anddeterminesthereportboundaryinascience-basedmanner,soastoeffectivelyrespondotheconcernsofthestakeholders.TheCompanyhasestablishedabasicprocessforanalyzingsustainabilitytopics,includingidentification,assessment,andselection.Theprocessisasfollows:IdentificationSurveyandAssessmentSelectionandPrioritizationPotentiallymaterialtopicsfortheCompany'sevaluationanddecision-makingareidentifiedthroughpolicyresearch,peercomparison,anddiagnosticanalysisofindustrytrends.WeconductsurveyamongtheCompany'sstakeholdersandinvitethemtoevaluatethematerialityofeachtopicfromtheirownperspective.Atthesametime,wereporttothemanagementandcollecttheiropinionsontheassessmentofthetopics,andassesstheimportanceoftopicstotheCompany'sproductionandoperation,strategicpoliciesandbusinessdevelopment.Basedontheassessment,thetopicsareprioritizedinorderofmateriality,andreviewedbythemanagementandconsultantexperts,andthematerialtopicsforkeydisclosureareselectedanddisclosedinamatrix.EnsuringproductqualityConsolidatingsafetyresponsibilitiesCompliantoperationsOptimizingresourceutilizationDevotedtotheR&DandinnovationResponsiblesupplychainProtectingemployeerightsandinterestsAddressingclimatechangeUnblockingcareerpathsPromotinggreenprocessesReducingpollutionemissionsProvidinghigh-qualityservicesInvestorrelationsBusinessethicsCaringforemployeesESGgovernanceDeepeningtheBeltandRoadcooperation1234567891011121314151617CarryingoutcommunitycharityStrengtheningenvironmentalmanagement1819CoretopicsImportanttopicsGeneraltopicsESGGovernanceTakingintoaccountthecurrentdevelopmentsituationandtherelevantESGrequirementsoftheplaceswherethestocksarelisted,HengyihascontinuouslydeepeneditsawarenessofESGgovernanceandintegrateditintothecorporatedevelopmentstrategyanddailyoperation,soastopromotehigh-qualityandsustainabledevelopment.ESGorganizationsystemTheCompanyactivelyfulfillsresponsibilitiesinenvironmental,social,andgovernanceaspects,graduallyestablishesandimprovestheESGmanagementframeworkandoperationmechanism,andcontinuouslypromotesaninterconnectedESGmechanismfromtoptodowntoenhanceourESGperformance.BoardofDirectorsAsthedecision-makingarm,itismainlyresponsibleforfinalizingtheESGstrategyandensuringthattheimplementationofthestrategyandESGdemandsareintegratedintothedecision-makingprocess.SeniorManagementAstheoverallcoordinator,itisresponsibleforimplementingtheESGstrategyandrequirementsoftheBoard,andreportingregularlytotheBoardontheplanningofESGaffairsandprogress.FunctionalDepartmentsAtthecoordinationlevel,departmentheadsareresponsibleforundertakingESGprojectsandcoordinatingandpromotingtheimplementationofroutineESGmanagement.ExternalcollaborativeorganizationsconsistofauditandevaluationinstitutionsandconsultinginstitutionscloselyrelatedtotheCompany,mainlyprovidingexternaldataandsupportfortheESGgovernance.ProductionDepartmentsAttheexecutivelevel,theyaremainlyresponsiblefortheday-to-daymanagementofESGinformation,aswellasacceptingtheESGmanagementguidancefromtheCompany'sheadquartersandprovidingfeedbackonmanagementperformance.ESGMaterialityMatrixin2023TheimportanceofexternalstakeholdersThedegreeofsignificantimpactonHengyiCarryingoutcommunitycharityStrengtheningenvironmentalmanagementCaringforemployeesInvestorrelationsBusinessethicsESGgovernanceDeepeningtheBeltandRoadcooperationReducingpollutionemissionsProvidinghigh-qualityservicesPromotinggreenprocessesUnblockingcareerpathsAddressingclimatechangeProtectingemployeerightsandinterestsResponsiblesupplychainOptimizingresourceutilizationConsolidatingsafetyresponsibilitiesCompliantoperationsEnsuringproductqualityDevotedtotheR&Dandinnovation222023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.23StakeholderCommunicationTheCompanyattachesgreatimportancetothedemandsandexpectationsofstakeholders.Wehaveidentifiedstakeholdersincludinggovernmentandregulators,shareholdersandinvestors,employees,customers,partners,communities,etc.Avarietyofchannels,suchas,theCompany'sofficialwebsiteandWeChatofficialaccount,consultationandexchange,generalmeetingsofshareholders,industryparticipation,areadoptedtoenhancethetwo-waycommunicationwithstakeholdersandlistentoreasonableopinionsandsuggestionsfrominternalandexternalstakeholders,whichserveasacrucialreferencefortheCompanytoimproveitsESGgovernance.GovernmentsupervisionandinspectionDailycommunicationStatutoryinformationdisclosureParticipatinginmajoreventssuchassymposiumsandseminarsEnvironmentperformancedatacollectionanddisclosureExternalsurvey,feedbackancommunicationMediacommunicationPressreleasesandannouncementsPerformancereleaseandmeetingsTeleconferencesandonlineinteractionsInvestorhotlineInvestorvisitsShareholders’MeetingImprovingcompanyperformanceProtectingtheinterestsofshareholdersandinvestorsTheauthenticity,accuracy,timeliness,andcompletenessofinformationdisclosureSustainabledevelopmentoftheCompanyProjectapprovalQuestionnairesurveyGovernmentandregulatorsStrengtheningcorporategovernanceCompliantoperationsEnsuringsupplyProvidingemploymentopportunitiesDrivinglocaleconomicdevelopmentAddressingclimatechangeShareholdersandinvestorsEmployeesStrengtheningcorporategovernanceEmployeerightsprotectionUnblockingcareerdevelopmentOccupationalhealthandsafetyDemocraticmanagementEmployeecareWorkers'congressEmployeerecognitionRegulartrainingNormalcommunicationCorporatecultureactivitiesWebsiteandWeChatofficialaccount,ect.CustomersIntegrityandcomplianceGoodcustomerrelationshipsHighqualityproductsandservicequalityProductinnovationProductSafetyMarketsurveyD。
3. ailyservicecommunicationCustomerfeedbackmechanismTelephoneserviceProductpackaginginformationPartnersPriceandtimelypaymentLong-termpartnershipInformationresourcesharingIntegrityandmutualbenefitsSuppliermanagementRiskpreventionContractnegotiationBiddingmeetingsDocumentandcorrespondenceSuppliercommunicationandtrainingSupplierassistanceCommunitiesAddressingclimatechangePollutantdischargemanagementHarmoniouscommunitydevelopmentResourceutilizationStakeholderidentificationDemandsandexpectationsCommunicationmethodsStakeholderidentificationDemandsandexpectationsCommunicationmethods242023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.25Asoundecologicalenvironmentisthecornerstoneforsustainablehumanandsocialprogress.Hengyiconstantlyrefinesitsenvironmentalmanagementsystem,embeddingenergy-savingandenvironmentalprotectionintoeveryfacetofourproductionandoperations.Byinnovatinginandpromotinggreenprocesses,andminimizingemissionsandpollutioninmultiplemeasures,weaspiretoestablisharesource-efficient,eco-friendlyenterprisethatcontributestoharmonybetweenhumanandnatureandabeautifulworld.investedinenvironmentalprotectionActionsandResponsesin2023millionmilliontons521.4955ClimateChangeResponseEnvironmentalManagementWaterResourceUtilizationPollutantEmissionReductionEcologicalProtectionfreshwatersaved9.3745withtheEnvironmentbyGreenDevelopmentStrivingforHarmony262023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.27ClimateChangeResponseTheburning,production,andprocessingactivitiesoffossilfuelsbypetrochemicalcompaniesconstitutetheirprimarysourceofgreenhousegas(GHG)emissions.AttachinggreatimportancetoChina’scommitmentofachievingcarbonpeakingandcarbonneutrality,Hengyikeepsimprovingitsclimatechangeresponsesystem.Weproactivelyengageinreducingcarbonemissionsandhaveformulatedspecifictargetsandactionsaccordingtoourconditions.SystemsMetricsandtargetsTheCompanyestablishestheHSEManagementCommittee.Inlinewithnationalandlocalmandatesforcarbonpeaking,thiscommitteeistaskedwithoveralllayoutandholisticpromotionforcarbonpeaking,includingresearchinsignificantaffairsandformulationofmajorpolicies.Theleadinggroupformsacarbonmanagementsystemprioritizingcontrolovercarbonintensityandsupplementedbycontrolovertotalamountofcarbonemissions.Furthermore,anorganizationalframeworkforcarbonmanagementisinplacetoregularlyscheduleworkprogressandurgethedetailedexecutionoftasks.Comprehensivecarboninventoryisconducted,withemissionsdatareportedperiodically.Byassessingcarbonemissionsdata,weformulatescientificallysoundandeffectiveplansforreducingcarbonemissions.Additionally,bysynchronizingthemanagementandassessmentofenergyconsumptionandcarbonemissionindicators,theCompanygraduallybuildsasoundcarbonpeakingassessmentsystem,providingbothorganizationalandinstitutionalguaranteestowardsachievingthecarbonpeakingandcarbonneutralitygoals.In2023,theCompanymeasureditscarbonemissionsfromboilers,gasturbines,andpowergenerationequipmentusingpurchasedelectricityinaccordancewithreportingstandardsandtechnicalspecificationssuchastheGuidelinesontheGHGEmissionAccountingandReportingforChineseEnterprises:PowerGenerationFacilitiesreleasedbytheMinistryofEcologyandEnvironment.Note:Scope1CO2emissionsrefertototalCO2emissionsin2023fromthecombustionoffuelsandtheuseofrawmaterials,auxiliarymaterials,steam,etc.,intheproductionprocessbyHengyianditssubsidiaries,minustheamountofCO2recycled.Scope2CO2emissionsrefertototalCO2emissionsin2023frompurchasedelectricitybyHengyianditssubsidiaries.ActionsGeneralgoalShortandmedium-termtargetsTheCompanyconductscarbonpeakingandcarbonneutralityworkefficientlyandmethodically,withcleargoalsandtasks.Expeditinggreentransformationinmodesofproductionandwaysoflife,weadvocateforaneconomyandsocietybuiltonefficientuseofresourcesandgreenandlow-carbondevelopment,ensuringcarbonpeakingby2030andcarbonneutralityby2060.TotalScope1&2carbonemissions(milliontons)IndicatorAbsoluteBelow25%increaseintotalScope1&2carbonemissions8.098.825in2023AmountandintensityofcarbonemissionsTotalCO2emissionsYear-on-yeardecreaseintotalCO2emissions8.09milliontons1.02TotalScope1CO2emissions4.24TotalScope2CO2emissions3.85IntensityofCO2emissions0.06Inresponsetothechallengesposedbyclimatechange,theCompanyproactivelyseeksoutcarbonreductionpathways.Wefocus“sevencarbonpeakingactions":greenandlow-carbonenergytransitionaction,energy-saving,carbonreductionandefficiencyincreaseaction,greenandlow-carbonactionintheproductionfield,greenandlow-carbonactioninthetransportfield,carbonfootprintreductionactionthroughthecirculareconomy,greenandlow-carbonactionthroughtechnologicalinnovation,andgreenandlow-carbonactionforthepublic.Greenandlow-carbonenergytransitionactionAligningwiththenationalstrategyforgreenproduction,theCompanyactivelyengagesinthedevelopmentandutilizationofcleanenergyandvaluestheapplicationofnewenergyandwasteheatrecoverytechnology.Throughmeasuressuchasphotovoltaic(PV)powergenerationandpeak-valleyenergystorage,weadvancegreenerproduction.Inrecentyears,wehavebeenadvancinggreenproductionthroughprojectssuchas100%rooftopPVcoverageinfactories,constructionofPVpowergenerationexperimentalbases,andtheapplicationofpeak-valleyenergystorage.In2023,weexpandedourPVinstalledcapacityby41MWtototal104MW,generating65.14GWhofelectricity,whichisexpectedtoreach106GWhby2024.Asof2023,approximately40%ofourcapacityhadbeensupportedbywasteheatpowergeneration,afigureweexpecttoexceed70%by2024.RooftopPVpowergenerationTargettypeBaselinefor202520232030milliontonsmilliontonsmilliontonsmilliontons282023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.292023年公司进行锅炉升级、新建、改造和淘汰，总计约7台次，整体能耗总量降低约9.05%,节能减排效果显著。TheCompanypromotestheuseofnewenergyvehiclesamongitsstaffandhasintroducednon-roadmobilemachineriesinareasofournewenergyoperations.In2023,wecompleted34energy-savingrenovations.TheCompanyreduceselectricityconsumptionthroughinstallingenergy-savinglamps,combineduseofaircompressors,equipmentupgrades,amongothers.In2023,around7boilerswereupgraded,installed,renovated,anddecommissioned,resultinginasubstantial9.05%reductioninoverallenergyconsumption.Ourpolyesterplantsareengagedincarbonfootprintaccountingandcarbontrading.ComprehensivecarbonfootprintsareaccountedacrossrawmaterialssuchasPTAandethyleneglycol,auxiliarymaterials,andsteamusedinproductionprocesses,polyesterfiberproducts,andpurchasedcoalandelectricity.Moreover,weensuremeasurementsofelectricityandheatconsumptioninproductionprocesses,withtimelystatisticalandledgerupdates.Relevantmeasuringdeviceslikeelectricmetersandsteamflowmetersarealsocalibratedandmaintainedpromptly.In2023,greenpowertradingwasgraduallyconductedinourpolyesterplants,withavolumeof3GWh.BoilersatShuangtuNewMaterialsAcetaldehyderecoveryinstallationGreenandlow-carbonactionintheproductionfield小知识：TheCompanyremainscommittedto"greenmanufacturing"and"circulareconomy,"takingconcreteactionsinpromotingthegreenandlow-carbontransformationacrosstheindustrialchain.Withafocusontheutilizationofpolyesterthroughoutitslifecycle,weachievehigh-qualitypolyesterrecyclingthroughtechnologicalbreakthroughs.Additionally,throughindependentinitiativesandR&D,theCompanyhasdevelopedsafeandqualitygreenpolyesterproducts,suchastheintroductionofinnovativeproductEticont.What’smore,wetaketheleadintheflame-retardantfiberproductsinChina,withbothproductionandsalesonasteadyupwardtrajectory.Weachievebreakthroughsinthekeytechnologyofin-situpolymerizationforantibacterialpolyesterthatfeaturespromisingprospects.Furthermore,wehaveintroducedhigh-performancepolyestermaterialspreparedfrombio-basedrawmaterials,withsignificantsustainability,degradability,andenvironmentalbenefits.CarbonfootprintreductionactionthroughthecirculareconomyIn2023,wespentRMB8millionontwoadvancedaircompressors.Alongsidethis,werevampedourexistingpipelinenetworktooperateatreducedanddifferentialpressures,achievingareductioninmotorpowerconsumptionby1,790kWandsavingelectricityof14.8GWh/year.Additionally,weundertook12upgradestoourcompressedairconditioningsystems,leadingtoelectricitysavingsof5.762GWhandannualsavingsprojectedat21.4GWh.Energy-saving,carbonreductionandefficiencyincreaseactionInactiveresponsetothenationalmandateto“phaseoutoutdatedcapacityforindustrialupgrading”,theCompanystrengthensenergymanagementandstaggerselectricityuseduringpeakhours.Throughenergy-savingrenovationsforequipmentandprocesses,includingmotors,fans,pumps,compressors,transformers,heatexchangers,andindustrialboilers,wemanagetoreduceenergyconsumptionwhileenhancingqualityandcompetitiveness.TheCompanyadoptsthetreatmentprocessof“bagdedusting+SCRde-nitration+limestonegypsumdesulfurization+wetelectricdedusting”forcoal-firedboilers.Thisapproachraisescoalquality,makeschemicalrawmaterialslighter,andreducesScope1GHGemissions.Inourpolyesterplants,theeco-friendlyacetaldehyderecoverytechnologyisemployedtoextractindustrialacetaldehydeandglycolfromwastewater.ThisnotonlylowersCODemissions,butalsoconsumeslessrawmaterials,saveresources,andmeetstheexpandingproductiondemand.By2023,approximately67%ofourpolyesterproductioncapacityhadincorporatedthistechnology,recoveringabout15,000tonsofacetaldehydeand6,000tonsofglycolin2023alone.Greenandlow-carbonactioninthetransportfield302023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.31EnvironmentalManagementTheCompanystrictlycomplieswithlawsandregulationssuchastheEnvironmentalProtectionLawandtheEnvironmentalImpactAssessmentLaw.WehaveformulatedtheEnvironmentalProtectionManagementSystem,andalsoadvanceenvironmentalcertificationsacrosssubsidiaries.Duringthereportingperiod,7ofoursubsidiarieswerecertifiedbytheISO14001:Environmentalmanagementsystems.TheCompanyabidesstrictlybytherequirementfornationalpollutantdischargepermitsanddevelopsanenvironmentalself-monitoringplan.Further,weengageaqualifiedthird-partyagencyforregularmonitoring,ensuringallpollutantsaredischargedincompliancewithlegalandregulatorystandards.521.4955millioninvestedinenvironmentalprotectionin2023Data7ofoursubsidiarieswerecertifiedbytheISO14001:EnvironmentalmanagementsystemsHengyiengagesenvironmentalvolunteersupervisorsfromneighboringcommunitiesZhejiangYisheng,asubsidiaryofHengyi,hashiredtenenvironmentalvolunteersupervisorsfromneighboringcommunitiestooverseeandguideourenvironmentalprotectionendeavors.Throughtheirpromptinformationaboutsurroundingodors,wecouldtakecountermeasuresmoreeffectivelytoboostourenvironmentalgovernancecapabilities.CaseSpringFestivalTeaPartyforEnvironmentalVolunteerSupervisorsIdentificationofenvironmentalhazardsTheCompanyinstitutesanenvironmentalprotectioninspectionsystem,conductingdailyinspectionsontheoperationofenvironmentalfacilitiesandodorswithinandnearourfactories.Moreover,weidentifyenvironmentalhazardsacrosstheCompanyonamonthlybasis,followedbypromptrectifications,ensuringzeroenvironmentalpollutionincidents.EnvironmentalemergencymanagementTheCompanyintensifiesriskmanagementinenvironmentalprotection.Wehaveestablishedaleadinggroupforenvironmentalpollutionemergencyresponseandanemergencyresponseoffice.Wedraftemergencyresponseproceduresandplans,andhaverevisedtheResponsePlanforEnvironmentalEmergencies.Weprovideinstitutionalprovisionsforemergencytraining,drills,emergencypreparednessandresponses,accidentevaluations,amongothers,coupledwithaccidentdrills.Theseendeavorsensurewerapidlymanageaccidentsandminimizeharmsandlosses.Beforethecommencementofprojectoperation,theCompanyenhancesenvironmentalemergencymeasures,ensuresadequatereservesofemergencysupplies,andconducttrainingonpollutionpreventionandcontrolmeasuresforemployees.Weorganizeregularemergencytraininganddrillsforenvironmentalemergencies,andkeeprecordswiththelocalenvironmentalauthority.2023年公司进行锅炉升级、新建、改造和淘汰，总计约7台次，整体能耗总量降低约9.05%,节能减排效果显著。TheCompanyencouragesgreenconsumptionandtheuseofgreen,low-carbonproducts.Bycontinuouslystrengtheningecologicaleducationamongemployees,weintegrategreenandlow-carbonprinciplesintoproductionandlife.Throughpublicity,advertising,andactivitiessuchasEnvironmentDayandLow-CarbonDayforallstaff,weenhancetheirgreenandlow-carbonawareness.InNovember2023,theASEANandAPECBusinessAdvisoryCouncilsofBruneiincollaborationwiththeMinistryofFinanceandEconomyorganizedtheBruneiSustainableEconomyForum2023themed“SustainableGoals:BalancingGrowthandClimateCommitments”.TheForumaimstohighlightBrunei’scommitmentstoasustainablefutureandexploretheroleofbusinessinachievingthesenationalgoals.UnderthesupportofBrunei’sMinistryofFinanceandEconomy,ARUP,acompanybasedintheUK,andHengyiwereinvitedtodiscussongreeneconomicdevelopmentandseekcarbonreductionsolutions.2023年公司进行锅炉升级、新建、改造和淘汰，总计约7台次，整体能耗总量降低约9.05%,节能减排效果显著。TheproductionprocessofcaprolactamusesnitrogenandgeneratesCO2,renderingtheentireprocesslesscost-effectiveandenvironmentallyfriendly.ThroughtheadoptionoftheCCUStechnologyandthecooperationwithHangzhouOxygenPlantGroupCO.,Ltd.(Hangyang),theCompanyhasinvestedinasetoftheultra-highpuritynitrogenairseparationequipmentwiththecapacityof3,000m3/handasetofCO2recyclingequipmentwithanannualcapacityof200,000tons.Thisinitiativeinvolvesrecyclingaportionofthehigh-purityCO2fordryiceproductionatHangyang,utilizinganotherportionasrawgasfortransportinggasifiedcoal,andemptyingexcesstailgas,aneffortthatachievesCO2capture.Greenandlow-carbonactionthroughtechnologicalinnovationGreenandlow-carbonactionforallstaffCO2recoveryandutilizationfacilities322023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.33WaterResourceUtilizationTheCompanyplacesahighpriorityontheconservationandcomprehensiveutilizationofwaterresources.Bypromotingmeasuressuchashigh-efficiencywaterproductiontechnology,efficientreuseofreclaimedwater,andconservationofwaterincoolingtowers,wesupporttheconservationandcircularuseofwater,boostutilizationefficiency,andreduceconsumption.In2023,wesavedfreshwaterby9.3745milliontons.TheCompanyhasdevelopedpoliciessuchastheWaterConservationManagementRegulationsandtheWaterConservationAssessmentRegulations.Awaterconservationmanagementteamisinplacetocontinuallystandardizeandrefineourwaterconsumptionandconservationsystems.Whileencouragingemployeeparticipationinwaterconservation,weintensifywaterconservationinspectionsonpublicfacilitiesandofferrewardsforreportsofnon-compliancewithourwaterconservationpolicy.In2023,9.3745milliontonsfreshwatersavedDesaltedWaterPreparationEquipmentThroughbiologicaltreatment,ultrafiltration,andreverseosmosisofwastewaterproducedinourproductionprocesses,weachievean87-93%reuserateofreclaimedwater.TheCompanyreplacesoriginaldesaltedwaterpreparationprocesses,suchasdiscfilters,ultrafiltration,reverseosmosiswithROmembranes,andmixedbedionexchange,withtheEFDTprocess,addressingchallengessuchashighrequirementsforinputwaterquality,lowyieldofoutputwater,andhighenergyconsumption.EfficientreuseofreclaimedwaterWaterproductionprocessimprovementPollutantEmissionReductionTheCompanystrictlycomplieswithlawsandregulationsincludingtheLawonPreventionandControlofEnvironmentalPollutionbySolidWasteandtheWaterPollutionPreventionandControlLawtoimproveourpollutionpreventionandcontrolmechanism.Throughstrictcontroloverthedischargeofwastewater,exhaustgases,andsolidwaste,weenhanceourpreventionandcontrolandminimizeenvironmentalimpact,buildingourselvesintoaresource-savingandeco-friendlyenterprise.In2023,weexperiencednosignificantenvironmentalpollutionincidents,maintaininga100%complianceratewithemissionstandards.TheCompanycomplieswiththeWaterPollutionPreventionandControlLawandlocaldischargestandards.Undertheprincipleof“separatingbypollutiontype,rainwaterandsewage,andindustrial/domesticwastewater”,weestablishasoundin-factorywastewatercollectionsystem,employingmeasuresagainstcorrosion,leakage,andseepagetocontroldischargeofwastewater.Wastewaterfrompolyesterproduction,afterpre-treatmentbysteamstrippinginstallations,isprocessedusing“pre-treatment+anaerobicdigestion+aerobioticsecondarybiochemistry”techniquesatsewagetreatmentstationstogetherwithwastewaterfromspinningworkshopsanddomesticsewage.Thetreatedportionisrecycledthroughthereclaimedwaterreusesystem,whiletheremainderisdischargedintothesewagepipenetworkaftermeetingrelevantstandardsintheTechnicalRequirementsforMethylBromideQuarantineFumigationChamber(GB31752-2015).In2023,theamountofammonianitrogendischargedfromwastewaterwas12.45tons,ayear-on-yeardecreaseof67.55tons.Exhaustgasesemittedfromourproductionactivitiesmainlyincludedust,non-methanetotalhydrocarbons,acetaldehyde,andsmoke.Asperrelevantlawsandregulationsconcerningairpollutioncontrol,theEm。
4. issionStandardofPollutantsforSyntheticResinIndustry,theEmissionStandardofAirPollutantsforBoiler,andlocalemissionstandards,theCompanyadoptstheprincipleofcategorizedtreatmenttocontrolatthesource.Byimplementingtreatmentmeasuresfromenvironmentalassessments,wereducethegenerationofexhaustgases,strictlycontrollingandminimizingtheemissionsofunorganizedexhaustgases.In2023,theamountofsmokeanddustemissionswas111.86tons.ThedeodorizationandcovertreatmentsystemofPTAaerationtanksenablesdischargeafterhigh-energyionpurificationtreatment,withadesigncapacityof101,000m3/handadeodorizationefficiencyofupto90%DischargeofPTAFeedingDustafterTreatmentbyBagFiltersExhaustgasmanagementWastewatermanagementDigitalenvironmentalmanagementTheCompanyhasestablishedadigitalplatformforsafetyandenvironmentalprotectioninformation,wheretheenvironmentalprotectionsectorencompassesonlinemonitoringmanagement,videosurveillancemanagement,hazardouswastemanagement,resourceandenergymanagement,andenvironmentalfacilitiesmanagement.Throughonlinemonitoringanalysisandenvironmentalfacilitiesmanagement,wecanaccesstopollutantemissiondataatalloutletsandtheoperationofenvironmentalfacilities.Moreover,theplatformincludesafeatureofpollutantemissiondatawarning,pushingdatatorelevantpersonnelwhenemissionconcentrationsreachthresholdlevels.ReclaimedWaterTreatmentEquipment342023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.35DischargeofpolyesterwastegasafterbeingintroducedintothehotcoalfurnaceforincinerationDischargeofspinningexhaustgasaftertreatmentbyoilsmokepurifiersDischargeoffluegasfromcoalwaterslurry-firedboilersviathechimneyafterdenitrification,dustremoval,anddesulfurizationtreatmentHengyiusesRTOinstallationstoimproveincinerationefficiencyZhejiangYisheng,asubsidiaryoftheCompany,hasintroducedfivesetsofRegenerativeThermalOxidation(RTO)environmentalequipment,featuringregenerativeceramicswith95%heatrecoveryefficiency.Theytreatorganicexhaustgasesacrossa0-8%concentrationrangewithover95%incinerationefficiencyanda98%Brionremovalefficiencyinscrubbingtowers,reducingfuelconsumptionsignificantly.Thisensureseffectiveheatrecoveryandconsistent,reliableexhaustgastreatment.CaseWastemanagementTheCompanystrictlyabidesbylawsandregulationssuchastheLawonPreventionandControlofEnvironmentalPollutionbySolidWaste.Undertheprinciplesofrecycling,reduction,andharmlessnessintreatingsolidwastegeneratedinourproductionprocess,weestablishaledgersystemandsetuptemporarywastestoragefacilities,coupledwithclassifiedcollection,storage,andquality-baseddisposalofhazardouswasteandgeneralsolidwastetoensuresafeandefficienttreatment.GeneralwasteHazardouswasteInaccordancewiththeStandardforPollutionControlontheNon-HazardousIndustrialSolidWasteStorageandLandfill,wesellwasteblocks/slices,usedfiltercartridges,textilewasteandscrapsilk,anddiscardedpackagingmaterialstorecyclingcompanies,andentrusttheenvironmentalsanitationdepartmenttodisposedomesticwaste.InstrictaccordancewiththeStandardforPollutionControlonHazardousWasteStorage,weentrustthedisposalofhazardouswastesuchaswasteoiltoqualifiedandcapableagencies.Wehandletransferandapprovalproceduresaccordingtoregulationsandstrictlyimplementthehazardouswastetransferformsystem.EcologicalProtectionTheCompanystepsupeffortstopromoteeco-friendlyprinciples.Wecultivateecologicalprotectionawarenessamongouremployeesandadvocateforalow-carbonlifestyle.Employeesareorganizedtoparticipateinrelevantpublicwelfareactivitiesandknowledgetraining,allowinggreen,low-carbonconceptstoberootedintheirhearts.Electricity-SavingTipsHengyiconductsabeachcleaningcampaignincelebrationoftheWorldCleanupDayOnSeptember20,2023,HengyiIndustries,incollaborationwithGreenBrunei,heldabeachcleanupcampaign,engaging45Hengyiemployeesand10GreenBruneivolunteers.TheeventispartofHengyiIndustries’“OnePlanetInitiative"andiskeptinlinewiththethemeoftheWorldCleanupDay.Throughpickinguptrashonthebeachesandpromotingideasalongthebeaches,thecompanyaimstopreservethenaturalbeautyofBruneiDarussalam’sbeaches.Case362023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.37Committedtoa“safetyfirst”policy,theCompanystrictlyadherestolawsandregulationsconcerningworksafety,includingtheWorkSafetyLawandtheRegulationsontheSafetyAdministrationofHazardousChemicals,holdingontotheredlineofsafety.Wecontinuallyenhancethequalityofourproductsandservicestowardsexcellence,winningtrustandrespectfromcustomers.NomajorworksafetyaccidentsActionsandresponsesin2023SafetyResponsibilityProductQualitySuperiorServicesinvestedinsafetymillion139.8686passrateofsafetytraining100%TrustwithQualityEarningCustomer382023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.39SafetyResponsibilityTheCompanyestablishesandrefinesinternalpoliciesandoperationalproceduresforworksafety.Bypromotingworksafetystandardizationandthedualpreventionsystemacrosstheboard,wekeepimprovingourworksafetymanagementsystem.Thisincludesbolsteringsafetytrainingandachievingclosed-loopmanagementofworksafetytobuildasoliddefenseinworksafety.WorksafetymanagementWorksafetymechanismWorksafetystandardizationClosed-loopmanagementofworksafetyHolisticsafetyresponsibilityperformanceTheCompanyestablishesanHSECommittee,witheachbranchandsubsidiarysettingupanHSEleadinggrouptoimplementworksafetypolicy,study,coordinate,makedecisionson,andguidetheCompany’smajorworksafetyissues,urgereportsonworksafetyinspections,listentoadvicefromalllevels,andproposepracticalsolutions.TheCompanyestablishesandrefinesinternalpoliciesforworksafety,suchastheResponsibilitySystemforWorkSafetyandEnvironmentalProtection,theProvisionsontheAdministrationofIdentificationandTreatmentofHazards,theProvisionsontheAdministrationofFireSafety,andtheProvisionsontheAdministrationofFireWorkSafety.Wedevelopaworksafetymanagementsystem,whichhasbeencertified,andadvanceworksafetystandardization,ensuringworksafetyinproductionandoperationalactivities.Bytheendofthereportingperiod,nineofoursubsidiarieshadachievedLevel3certificationinworksafetystandardization,onehadachievedLevel2certification,andanotheronehadachievedLevel1certification.Therewerenomajorwork-relatedinjuriesandcasualtiesin2023.Adheringto“riskcontrolbeforehazardsareformedandhazardeliminationbeforeaccidentsoccur”,theCompanyestablishesadualpreventionsystemfeaturing“participationbyall,controlthroughouttheprocess,andcoverageinallareas”.Throughresponseinadvance,accuratemonitoring,sourcetreatment,andscientificprevention,weachieveclosed-loopmanagementofworksafetythroughriskcontrolandahazardidentificationandtreatmentsystem.TheCompanypromotesthesigningoftargetresponsibilitylettersforsafetyandenvironmentalprotectionacrosstheboardtomakeclearthereasonabilitytargetsforsafetyandenvironmentalprotectioninpositionsatalllevels.Aimingatthefullcoverageofresponsibilitybothverticallyandhorizontally,weensureregularandeffectivefunctioningthroughtheall-staffworksafetyincentiveandconstraintmechanism.SafetyRiskNotificationsPostedinPositionsontheSiteSafetyemergencymanagementTheCompanyestablishesanemergencymanagementsystemandformulatesemergencyresponseplansforcriticallinks.Throughfull-scale,tabletop,andothervariousformsofemergencydrills,weexaminethecomplianceofemergencyplanswithreality,theeffectivenessofemergencyresponses,andtheproficiencyofemergencyresponseteamsinskills.Wealsoorganizeemergencydrillsincollaborationwithrelevantdepartmentstoconsistentlyenhancethesafetyemergencyskillsandcomprehensiveemergencyresponselevelofouremployees.201safetyemergencydrills9,336participantsIn2023402023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.41HengyiconductsemergencydrillsInJune,theCompanypromotedalllevelstoconductemergencydrills.Inourbranchesandsubsidiaries,teamleadersorganizedemergencyequipmenttraininginbatches.Throughfull-scale,tabletop,andotherformsofemergencydrills,wesignificantlybolsteredouremergencyresponseandrescuecapabilities,providingguaranteeforworksafety.CaseEmergencyRescueDrillsatZhejiangYishengEmergencyDrillsforThermalMediumLeaks,FireEscape,HazardousWasteLeaks,andConfinedSpacesatFujianYijinThefirefightingskillschallengeJune2023markedthe22ndNationalWorkSafetyMonth,duringwhichSuqianYida,JiaxingYipeng,HainingNewMaterial,andTaicangYifengcollaboratedtohostafirefightingskillschallenge.Featuringeventssuchasawaterhoserelaythrowandcatchrace,thisactivitysetsbothhonor-basedandmaterialrewards,aimingtoelevatethesafetyknowledgeandskillsofallemployees.CaseJointFirefightingSkillsChallengeSafetyhazardidentificationTheCompanyscientificallysetscyclesforidentifyinghazardsatalllevels,refinesthelistofitemstobeidentified,andfinalizescriteriaforclassificationandgradingofhazards.Wealsomakeclearresponsiblepersonnelfortreatment,andstrengthentheimplementationofrectificationsandacceptanceoftreatment.Moreover,wecarryoutspecialinspectionson“identifyinghazardsanddirectionsagainstregulations,illegaloperationsandviolationsoflabordiscipline”atrepairandmaintenancesites,guaranteeingmoretargetedidentificationofhazards.In2023HengyiorganizessafetyhazardidentificationByextensivelymobilizingallstaffforautonomoussafetymanagement,theCompanyidentifiedworksafetyhazardsinaholisticmanner.Bylearningfrompastaccidentstoclosegaps,shoreupweaknesses,strengthenmeasures,andeliminatehazards,wefurtheradvancethelong-termmechanismforidentifyingandaddressinghazards,withtheaimtocurbsuchaccidents.CaseCross-checksonSignificantHazardsatHengyiCaprolactaminCollaborationwiththeBureauofEmergencyManagementofShaoxingandExpertsfromChinaChemicalSafetyAssociationComprehensiveSafetyandEnvironmentalProtectionInspectionatJiaxingYipeng3,327safetyinspections13,297hazardsidentified99.86%rectificationcompletionrate422023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.43TheCompanyabidesstrictlybynationalregulationssuchastheRegulationsontheSafetyAdministrationofHazardousChemicalsandtheRegulationsontheAdministrationofPrecursorChemicals.Wekeepimprovingourmanagementsystemsforchemicalssafetyandexercisestringentoversightthroughouttheprocessofchemicals.Followingnationalandlocalrequirements,weconductregularchemicalaudits,andthoroughlystreamlineandestablishrecordsandledgerstopropelchemicalstowardsholisticandfinemanagement.HengyisetsupsignsformajorhazardsourcesandhazardsTheCompanyensuresnochemicalsthatarebanned,phasedout,ordesignatedforsubstitutionbynationalregulationsareusedinourproductionandoperationalactivities.Wesetupchemicalssafetysignsinworkplacethatalertemployeestobecautiousofhazardousareasandstrengthenpreventivemeasures,heighteningtheirawarenesstopreventrisksassociatedwithhazardouschemicals.CaseSafetySignsforHazardousChemicalsChemicalssafetymanagement0In2023,majorchemicalleaksorothersafetyincidentsoccurredHengyidevelopsasafetymanagementinformationsystemforchemicalsCommittedtothedigitalizationofworksafety,theCompanykeepsimprovingitssafetymanagementinformationsystem.ByintroducingtheZhejiangProvincialHazardousChemicalRiskPreventionandControlBigDataPlatform:WorkSafetySubsystem,weenabledigitalmanagementofpersonnelqualifications,operationalprocesses,workenvironments,andequipment,significantlyelevatingourcapabilitiesinchemicalsafetymanagement.ZhejiangProvincialHazardousChemicalRiskPreventionandControlBigDataPlatform(WorkSafetySubsystem)SafetytrainingTheCompanyattachesgreatattritiontosafetyeducationandtrainingforemployeestoenhancetheirsafetyawarenessandstrengthensoursafetytrainingsystem.Weconductdiverseworksafetytrainingsessionsandknowledgepromotionsviamultiplechannels,platformsandforms,includingWorkSafetyMonth,specializedlectures,practicaldrills,livestreamlining,videoconferences,andWeChatworkgroups,allaimedatboostingoursoftpowerinworksafety.In2023In2023HengyiconductssafetyactivitiesOnJune28,theCompanyorganizedatrainingsessionthemedon“SafetyAwarenessandEmergencyResponsesacrosstheWorkforce”,leadingtoaseriesofsafetyactivitiesatbothcompanyandteamlevels.Bycarryingforwardsafetycultureandconsolidatingresponsibilitieslevelbylevel,westriveforsafedevelopmentandaconduciveworksafetyenvironment.OnOctober30,theCompany’smanagementmembersparticipatedinthetrainingsessionsonLearningCasesforInternalAccidents,FactoryFireManagementTraining,andEnvironmentalProtectionManagementKnowledge,aimingtoenhanceemployees’awarenessinaccidentprevention,firesafety,andenvironmentalprotection.WatchingofCasesforWorkSafetyAccidentsbyEmployeesTrainingonLearningCasesforInternalWorkSafetyAccidentsProductQualityTheCompanyrigorouslyadherestorelevantnationalandindustryproductstandardsandfurtherimprovesourqualitymanagementsystem.All7ofoursubsidiarieshavebeencertifiedbytheISO9001QualitymanagementsystemandtheEUOEKO-TEX.Embracingstrictguaranteethatourproductsdonotcontainhazardoussubstancesandheavymetalsabovestandards,wearecommittedtodeliveringhigh-qualityproducts.Case15safetytrainingpertraineehours916safetytrainingsessions100%passrateofsafetytraining100%passrateofoutgoinginspection0.05%recallrateforproducts100%rectificationcompletionrate48issuesidentifiedinproductinspections11,079newemployeesengaginginthreelevelsofsafetytrainingCase442023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.45HengyiconductsQCgroupactivitiesandproductionoperationskillscontestsTheCompanyroutinelyauditsourqualitymanagementsystemandhostsinternaltechnicalandoperationaltrainingsessions.TheseincludeQCgroupactivitiesandproductionoperationskillscontest.CaseQCGroupActivitySkillsContestExercisingstrictcontroloverproductqualityTheCompanyhasformulatedtheInternalQualityControlStandardforChemicalFiberProducts,proposingclearrequirementsforstrictcontroloverphysicalpropertiesofchemicalfiberproducts.Accordingtoourqualitystandards,productsarecategorizedintothreegrades:excellent(AA),first-class(A),andqualified(B),withanyproductsbelowthisstandardclassifiedassubstandard(C).Wetrack,spotcheck,andmanageproductqualitymetricstoensurethedeliveryofhigh-qualityproductsthatmeetcustomerexpectations.WeestablishanexclusiveD1014–QualityFeedbackProcessforProcuredMaterialstohandlefeedbackonabnormalitiesinrawmaterialsWeestablishanexclusiveD1310–ChangeProcessforInspectionIndexCentralValueofChemicalFiberProductstooverseetheentireproductprocessQualitycontroloverrawmaterialsProcesscontroloverproductionImprovingqualitymanagementstandardsTheCompanycontinuallyformulatesandrefinesourqualitymanagementstandards.ByrevisingqualitymanagementpoliciessuchastheManagementSpecificationsforProductionStatistics,theProductionProcessManagementInspectionSystem,theMeasuresfortheManagementofProductCentralValue,andthePostOperationSpecifications,westandardizeourproductionprocessesandstandards,ensuringemployeecompliancewithprocedures.Additionally,weenhanceequipmentmanagement,improvethebasicledgerforequipmentmanagement,andconductspecializedmanagementinspectionsonequipmenttomaintainstableproductquality.SuperiorServicesInlinewithcustomer-centricphilosophy,theCompanycontinuallyimprovestheservicemanagementsystem.Weresponseactivelytodiversecustomerdemandsandlistentoemployeeevaluationsfeedbackonproductquality,thusenhancingthequalityofourproducts.Weelevateboththequalityandefficiencyofourservicesacrossmultipledimensions,ultimatelyboostingcustomersatisfaction.After-salesservicesComplainthandlingOurafter-salesserviceteamupholdstheprinciplesofprofessionalism,speed,andefficiency.Byequippingwithasoundafter-salesserviceguaranteesystem,wepromptlyoffertechnicalservicesandrespondtocomplaints,deliveringsuperiorafter-salesservicesforcustomers.TheCompanyplacesahighvalueoncustomercomplaintsandfeedback.Aimingtosatisfycustomerusedemands,wesmoothencomplaintchannels,optimizethecompliantmechanism,andenhancecompliantanalysis.Throughmulti-layeredcustomercomplaintchannels,suchasonsitevisits,micro-malls,anda400servicehotline,wepromptlyaddresscustomerissueswithvariousmethods,includingtechnicalguidance,productimprovements,exchangesandreturns,andfinancialcompensation,toconsistentlyenhancethequalityofcustomerservices.In2023In2023scoreforcustomersatisfaction,markinganimprovementfrom2022WeestablishaNon-ConformingProductFeedbackProcessandaD0941–ProductQualityEvaluationProcesstopromptlyevaluateproductsofabnormalqualityandcontroltheoutputofunqualifiedproductsControloverproductoutput99%customersatisfactionwithafter-salesservices98.2%completionrate644customercomplaintsreceived652handled94462023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.47HengyiupholdsthatasoundpartnershipwithallsidesisanintegralpartoftheCompany’srobustandsustainablegrowth.Wepoolthestrengthsofvariousstakeholderstoenhancesupp。
5. liermanagementandfosteracoordinateddevelopmentacrosstheupstreamanddownstreamindustrialchain.Meanwhile,weexpeditethedevelopmentofinnovativeproducts,cultivateatop-notchR&Dteamandfacilitateindustry-wideexchangesanddevelopment,aimingtoshapeabrighterfuturewithpartners.ResponsibleSupplierChainR&DandInnovationIndustryExchangesandCooperationnewsuppliersadmitted,withpatentapplicationsobtained2023ActionsandResponses1,00560domesticsuppliersandinventionpatents92658overseassuppliers79andWin-winRelationshipswithPartnersFosteringStable482023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.49ResponsibleSupplierChainHengyiiscommittedtosuppliermanagementthroughouttheentirelifecycle.Inthisregard,theCompanycontinuallyrefinesitssuppliermanagement,pursuesenvironmentallyfriendlyandresponsibleprocurement,andestablishesenduringandeffectivecommunicationchannelswithsuppliers.Ouraimistoelevateboththequalityofsuppliedgoodsandthelevelofserviceprovided.Asoftheendofthereportingperiod,theCompanyhadatotalofsuppliers8,111SupplierManagementTheCompanyconductssuppliermanagementacrosstheentirelifecyclebyestablishingandimplementingmanagementprotocolsliketheMeasuresfortheQualityManagementofExternalSuppliers,SupplierAdmissionRequirements,andMeasuresforSupplierInspectionandManagement.Meanwhile,theCompanyintroducesstandardizedandscientificmechanismsforsupplieradmission,inspection,trial,andevaluationandestablishesadigitalizedsuppliermanagementsystem,facilitatingefficientmanagementofprocurementsuppliers.Asoftheendofthereportingperiod,theCompanyhadatotalof8,111suppliers,including2,107activeengineeringsuppliers.In2023,weadmitted1,005newsuppliers,including926domesticsuppliersand79foreignones.SupplieradmissionandscreeningWitharigorousmechanismforsupplieradmissionmanagementinplace,Hengyiconductson-siteinspectionsanddeliversinspectionreports.In2023,atotalof295suppliersunderwenton-siteinspections,reflectingourambitionsonadmittingnewsuppliersandfortifyingoursuppliernetwork.SupplieradmissionprocessRegistrationSupplierbasicinformationreviewDeterminationofon-siteinspectionOn-siteinspectionTrialifnecessaryTrialperiodInitiationofadmissionapprovalprocessQualifiedsupplierDigitalprocurementsystemTheCompanyhasdevelopedandcontinuouslyrefinedtheSupplierRelationshipManagement(SRM)procurementinformationsystem,bolsteringitsfunctionalityandfortifyingagainstvulnerabilities.Inaddition,theCompanycomestoimplementthethree-waymatchingsystemandtheelectronicsealproject.Theseinitiativesencompassarangeofhigh-riskbusinessprocesses,includingsupplierselection,bidinvitationandbidtendering,tenderopening,tenderevaluation,anddeterminingbidwinner,allintegratedintothesystem.Stringentcontrolsareinplacetomanagebusinessprocessesandapprovals.TheSRMsystemhelpsusersandsuppliersestablishaninformationexchangeplatform,facilitatingsupplierregistration,admissionandassessment,sourcingidentification,inquirycomparison,biddingandotherbusinesscoordination,andalsoallowingforsupplierperformanceassessment.ResponsibleProcurementInadditiontomandatingasupplierqualitymanagementsystem,Hengyi’sbiddingandprocurementqualificationsencompasscriteriasuchascompliancewithenvironmentalmanagementandtheoccupationalhealthandsafetymanagementsystems,alongwithpossessingenvironmentalimpactassessmentstatusandwastewaterdischargepermitacquisitionstatus.Weadvocatethatsuppliersusecleanfuelsandproductionequipment,aimingtominimizeenvironmentalpollution.Moreover,weencourageoursupplierstoconsiderenvironmentalandsocialimpactswhendeliveringproductsandservices,therebyfosteringsecure,stable,andresponsiblesupplierrelationships.In2023,Hengyipersonallyinterviewedorcontactedviatelephonewith67SupplierCommunicationTheCompanyiscommittedtobuildingastableandenduringsuppliernetwork.Byimplementingasystemofrecognitionandrewards,weaimtoinstillasenseofhonoramongoursuppliersandenhancetheirloyalty.In2023,atotalof67supplierswerepersonallyinterviewedorcontactedviatelephone.Duringtheseinteractions,opinionsandsuggestionsweregatheredonprocurementservices,theSRMsystem,fairnessandjustice,honestpractices,andotherrelevantareas.Ouraimistocontinuallyrefinesuppliermanagement.suppliersConductingexcellentsupplierawardceremonyHengyi'saffiliatedengineeringfirmshashosted3excellentsupplierawardceremoniesandappreciationdinners,where33excellentsupplierswereinvited.Amongthese,92supplierswerehonoredasexcellentsupplierswhile144wereacknowledgedasvitalsuppliers.Theinitiative,characterizedbythepresentationandsendingofmedals,lettersofgratitude,Hengyicalendars,andsouvenirsadornedwiththeHangzhouAsianGamesmascot,underscorestheCompany'sproactiveendeavorsinnurturingstrongsupplierrelationships.CaseR&DandInnovationHengyiactivelyembracesthenewphilosophyofinnovative,coordinated,green,open,andshareddevelopmentandregardsinnovationastheprimarydrivingforce.Asweadvancethetransformationfrom“anindustrialHengyi"to“atechnologicalHengyi,"weremaincommittedtotheR&Dandapplicationofgreenchemicalsandadvancedmaterials,strivingtoemergeasthetechnicalleaderintheindustry.502023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.51Over1,027CurrentlyR&DpersonnelScientificandTechnologicalInnovationSystemGreenandInnovativeProductsTheCompanykeepsenhancingitssci-techinnovationsystemandincreasingitsinvestmentintechnology.Inaddition,weactivelycultivatethespiritofcraftsmanshipandfosteranatmosphereofinnovationamongallstaffmembers,strivingtobuildateamofpioneeringtechnicaltalentsanddevelopan"ecosystem"fortalentcultivation.Withtheongoingunleashingofinnovationpotential,weboostourcorecompetitivenessinindustrialdevelopment.Currently,therearemorethan1027R&Dpersonnel,including79R&Dtalentswithdoctoraldegrees.Approximately30%ofthemholdmaster’sordoctoraldegreesandseniortitles.TheyhailfromuniversitiessuchasZhejiangUniversity,FudanUniversity,DalianUniversityofTechnology,DonghuaUniversity,SichuanUniversity,SoochowUniversity,TianjinUniversity,UniversityofChineseAcademyofSciences,EastChinaUniversityofScienceandTechnology,andBeijingUniversityofChemicalTechnology,alongsiderenownedoverseasuniversities.Thisdiverseassemblycomprisesnumeroustechnicalandengineeringexperts,post-doctoralresearchersandseniorR&Dengineersinfieldsofpolyesterchemicalfiberandotherchemicalproducts.Since2019,theCompanyinitiatedthe"HundredHengyicraftsmen"andhassinceidentified39individualsas"Hengyicraftsmen."Annualactivitiessuchasthe"RationalizationContest,""QCAchievementPresentation,"and"InventionNamedAfterEmployee"havebeenorganizedtospurinnovationacrosstheentireworkforce.Byfindingandestablishingexemplaryinnovatorsinpostsandlaunchingemployeeinnovationworkshopsandleadingprofessionalprogram,theCompanyworkstoinspireaspiritofenterpriseintoitsworkforce.Overthecourseoftheinitiative,hundredsofyoungexemplarystaff,technicalexperts,leadingprofessionals,OutstandingEmployeesofSilverGearandOutstandingEmployeesofGoldGearhavebeenidentified,andmultipleinnovationworkshopshavebeenestablished.Additionally,sixworkmethodshavebeenrecognizedasadvancedpracticeswithintheXiaoshanDistrict.TheCompanylaunchesgreenandenvironmentallyfriendlypolyesterproduct"Eticont",layingoutmediumtolong-termprojectssuchasbiodegradablepolyester,biobasedpolyester,andexpandedpolyester.holdingmaster'sordoctoraldegreesandseniortitles30%AntibacterialPolyesterThisnewhealthprotectionproductwithantimicrobialfunction,independentlydevelopedbyHengyiResearchInstitute,takesnano-zincoxideasantibacterialagentsandadoptsanewpreparationmethodofinsitupolymerizationinsteadofthetraditionalmasterbatchblending.Thefiberhasexcellentantimicrobialandmechanicalproperties.Moreover,itallowsforthepreparationofantimicrobialcolorsilkormultifunctionalantimicrobialfibersbyincorporatingcolororfunctionalmasterbatches.Additionally,itfacilitatestheproductionofprofiledfibersthroughprofiledspinning,suchasmoisture-wickingcross-sectionalprofiles.ThefirstprizeoftheCNTACScienceTechnologyProgressAwardforthekeytechnologyandindustrializationofantimony-freeenvironmentallyfriendlypolyestermeltdirectspinningThesecondprizeofTechnologicalInventionAwardofIESCScienceandTechnologyAwardforantimonyfreepolyesterfiberThecertificateofExcellentIndustrialProductsofZhejiangProvincebyExcellentIndustrialProductSelectionCommitteeforEticontThethirdprizeofthePatentAwardofZhejiangProvincialIntellectualPropertyAwardTheCNTACPatentAwardforpreparationmethodoftitanium-siliconcompositehomogeneouscatalysisApplicationsSocks,underwear,towels,dishclothsandmilitaryuniformsEticontEticont,developedbyHengyiResearchInstituteundertheCompany,standsasapolyesterproductwithfullproprietaryrights.Eticontusesafulltitaniumcompositecatalystsystemtoreplaceheavymetalantimonycatalysts,addressingthelong-standingissueofwaterandsoilpollutionassociatedwithantimonycatalystsintraditionalpolyesterproduction.Thiseco-friendly,green,andhealth-consciousproductachievesgreencirculationthroughoutthetextileproductlifecycle.Moreover,Eticontmeetsallbenchmarksofantimonypolyesterproducts,makingitaseamlessreplacementacrossvariousapplications.Applicationsbabyclothes,underwear,hometextiles,andclothing522023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.53IntellectualPropertyProtectionWeattachimportancetotheprotectionofintellectualpropertyrights.Inthisregard,weabidebytheChineselawsandregulationsincludingthePatentLaw,theTrademarkLawandtheCopyrightLaw,andformulateIntellectualPropertyManagementMeasures,continuouslyimprovingthemanagementofthewaywecreateandutilizeintellectualpropertyrights.In2023,therewerenocontentiouscasesorlegalproceedingsregardingintellectualpropertyrights.FlameRetardantPolyesterStain-resistantPA6Bio-basedPolyesterTheproductservesasacopolymerflameretardant,withstable,long-lastingandeffectiveflame-retardantperformance.Boastingagoodtextureandappearance,itiswater-resistanteco-friendlyandnon-toxic.Notably,thefabricachievesB1levelflameretardancystandardofGB8624-2012,withalimitingoxygenindexover32%.Stain-resistantPA6standsoutasauniqueproductdevelopedwithfullproprietaryrightsbyHengyiResearchInstitute.Addressingthepressingmarketdemandfordomesticstain-resistantnylonfabrics,Hengyiembarkedonthe"keytechnologyandindustrializationprojectforstain-resistantPA6".Thisprojecthasledtoanindependentlydevelopednovelstain-resistantagentthroughformuladesign,optimizedpolymerizationprocesses,andupgradedpolymerizationequipment.Consequently,wemanagetoproducein-situpolymerizedstain-resistantPA6slices.Fabricscraftedfromtheseslicesofferpermanentresistancetoacidicdyes,eliminatingtheneedforadditionalsurfacetreatments.Moreover,we'vepioneeredkeytechnologiesforstain-resistantBCFprocess,coveringspinning,hotdrafting,hotairexpansion,andhigh-speedone-stepwinding.Byincorporatingcolormasterbatches,we'vemanufacturedBCFfiberproductswithexceptionalstainresistanceandcolorretention.Additionally,weworktoestablisharapidassessmentmethodforgradingthestainresistanceleveloffibersandfabrics,aimingtosupporttheoptimizationofstain-resistantproducts.Hengyisupportsresearchonmultiplebio-basedmaterials,whichuseagriculturalandforestrywasteasrawmaterialstomaximizeresourceutilizationandreduceoilconsumptionandcarbonemissions.Thesematerialsaresaferandmorerecyclable.ThroughcollaborationwithZhejiangUniversity,Hengyihasdevelopedhigh-qualityPEFandaseriesofcopolyestersusinganefficientpolymerizationcatalyticsystem.HengyiResearchInstituteplanstopromotethedevelopmentoftheemergingbio-basedmaterialsindustry,realizeaclosed-loopcycleofcarbondioxide,andcontributetoglobalenergystructureadjustmentsbyreducingcarbonemissionsinthepolyesterindustry.ApplicationsApplicationsApplicationsCurtains,wallcoverings,draperies,andbedspreadsinpublicplacesHigh-endcarpetssuchassquarecarpets,householdcarpets,andcarcarpetsHigh-barrierpackagingmaterialsAsoftheendofthereportingperiod,theCompanyboasts422validauthorizedpatentsand262validinventionpatentsIn2023,theCompanyhadatotalof60patentapplications,including58inventionpatentsDataThefirstprizeofthe2023CNTACScienceTechnologyProgressAwardfortheGreenManufacturingofTiO2MattingAgentforNylonandCompleteSetofTechnologiesforIndustrializationofFullyMatteNylonThethirdprizeofthePatentAwardofZhejiangProvincialIntellectualPropertyAwardbythePeople’sGovernmentofZhejiangProvinceforpreparationmethodoftitanium-siliconcompositehomogeneouscatalysisThesecondprizeofTechnologicalInventionAwardofIESCScienceandTechnologyAwardforthedevelopmentofgreenTitanium-basedcatalystanditsrelevantapplicationintheproductionofantimonyfreepolyesterfiberHonorsDigitalizationTheCompanyworkstoadvancethe"DigitalHengyi"initiative,withafocusonimplementingscenario-basedapplicationsinproduction,marketing,supplychain,procurement,andhumanresourcemanagement.Inaddition,weconductin-depthdataminingandanalysis,andhasbuiltanopenandsharedindustrialonlineplatform.Byutilizingdigitalintelligence,ouraimistoestablishsmartfactoriesthatempowertheCompanytoachieveefficientoperationsandhigh-qualitydevelopment.HengyiBrainTheCompanyshattersinformationsilosacrossitsbusinesswithabigdataplatform.Leveragingbigdatatechnology,we'veimplementedthe"HengyiBrain"productionandoperationdecision-makingsystemthatconsistsofover100businessmodels."HengyiBrain"fostersanintegratedvisualizationplatformof“onlinetrading,onlinefinance,warehousingandlogistics.”Theplatformoffersdiversedigitalsolutions,includingdigitalmanagement,smartmanufacturing,onlinetrading,logisticsservices,marketanalysis,coordinatedproduction,supplyandsales,aswellassupplychainfinance.Ouraimistoenhancethemanagementefficiencyofproductionandoperation,andachievedigitaltransformation.542023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.55SmartFactoryWithcutting-edgetechnologyandprocesses,weutilizearangeofintelligentmanufacturingequipmentsuchasthree-dimensionalwarehouses,automaticwinding,automaticpackaging,intelligentappearanceinspection,AGVcars,androbots.Inaddition,weadoptacustomer-centricapproach,focusingonoptimizingtheentiresupplychainexperiencefromorderplacementandproductionschedulingtologisticsandservices.Moreover,weoptimizeproductlifecyclemanagement,substantiallyreducinglaborintensitywhilegreatlyboostingproductivity.ThesecombinedeffortsempowerHengyitoachievesmartfactorymanagementanddeliverflexibleproductioncapabilities.ProductionendThroughasmartmanufacturingexecutionsystem,weconnectvariousautomatedandintelligentdevices,achievingintelligentproduction,managementanddecision-making,andenablingafull-processproducttraceabilitysystem.Additionally,wehaveindependentlydevelopedasingle-spindledataflowsystemthatfacilitatesefficientlogisticswithintheworkshopwarehouseandenablesautomaticqualitycontrol,contributingtoprocessoptimization,informationsharing,andefficiencyimprovementamongvariousproductionprocesses.MarketingendWithanintegratedsupplychainsystem,wehaverealizedtheintegratedmanagementoftheentiresupplychainprocess,fromcustomersplacingordersontheonlinestoreandmarketingordermanagementtosmartwarehousingpickingandassembly,intelligentparklogistics,andlogisticsdistribution.SalesDataFull-processSystemThesalesdatafull-processsystemprioritizeslong-termcustomervalue.Byintegratingsystemslikemicromall,closed-loopmarketing,shipmentcommissioning,andshipmentapplications,thesystemembedscustomermarketingservicesthroughouttheCompany'soperations.Thisautomationandoptimizationofthesalesprocesshavetranslatedintoenhancedsalesefficiencyandaccuracy,ultimatelyimprovingcustomersatisfactionandofferingsteadfastsupportfortheCompany'sgrowth.LaborForceManagementSystemLogisticsTransportationManagementPlatformTheCompanyofficiallyimplementsalaborforcemanagementsystemtostandardizethehumanresourcemanagementinascientific,refined,andconvenientway.Throughmodulesliketheattendance,employeeexperience,andanalysisstatement(BI),thesystemaddressesissuessuchasinefficientpersonnelmanagement,sluggishandpoorlycorrelatedpersonaldatacollection,andlowemployeeengagement.Finally,thesystemleadstostandardizedmanagementofcrucialelementssuchasorganizationstructure,jobpositions,andprocesses.Italsoenablesregulatedbusinessprocessesincludingonboarding,offboarding,andtransfers,andautomatedoperationrulessuchasscheduling,leave-taking,andperformance-tracking.Withtheintegrationofdatafromdifferentbusinesssystems,theefficiencyofHRmanagementisgreatlyenhanced.Thesystemencompassesvariousfunctionalmodulesincludingcontractmanagement,rawmaterialtransportationmanagement,finishedproductdistributionmanagement,bulkcargotransportationmanagement,repairandmaintenancemanagement,drivermini-program,billingmanagement,driver’svehiclemanagement,statementsdashb。
6. oard,andmonitoringandalarmcenter.Theapplicationofthislogisticssystemhascomprehensivelyenhancedtheefficiencyofeverylink,facilitatingreal-timebusinessdatasharingandrelevantstatisticalanalysis.Iteffectivelyboostslogisticscarriagecapacity,leadingtocomprehensiveimprovementofoverallperformanceforthelogisticsenterprise.IndustryExchangesandCooperationValuingindustryexchangesandcooperation,theCompanyactivelyforgespartnershipswithindustryassociations,universities,researchinstitutions.Bypoolingvariousresources,wecreatearobustsynergyamongindustry,academia,andresearchinstitutes.Inaddition,weactivelyengageinindustryseminarsandstandardpreparation,developplatformsforemergingtechnologiesandpromotetalentcultivation,aimingtocollaboratewithpeerstodriveindustryadvancement.Asoftheendofthereportingperiod,40nationalandindustrystandardsformulatedorrevisedbytheCompany,including10nationalstandards,24industrystandardsand6associationstandardsDataIndustryStandardEstablishmentTheCompanyearnestlyimplementsthenationalpolicydecisionsregardingscientificandtechnologicalinnovationandstandardization.Weactivelyengageintheformulationofinternationalandindustrystandards,promotethedisseminationandapplicationofcutting-edgetechnologies,andsharetheachievementsofinnovation.HengyiResearchInstituteholdstheannualmeetingofnationalkeyR&DprogramsOnMay30th,theannualacademicexchangeconferenceforthe“EfficientGreenProductionandIndustrialDemonstrationofBio-basedPolyamideMonomerandMaterials”,thekeyprojectunder"GreenBio-manufacturing"inthenationalkeyresearchanddevelopmentplan,wassuccessfullyconvenedatHengyiResearchInstitute.ScholarsandexpertsfromvariousinstitutionsincludingtheInstituteofMicrobiologyoftheChineseAcademyofSciences,theInstituteofProcessEngineeringoftheChineseAcademyofSciences,ZhejiangUniversity,DonghuaUniversity,HengyiResearchInstitute,NingxiaEppenBiotechCo.,Ltd,andTianjinUniversityofScienceandTechnology,cametogethertodiscussthelatestadvancementsinacademicresearchandindustrialapplicationprogressrelatedtopolyamidemonomersandmaterials.Theexchangehelpedwiththeexplorationofwaystodevelopandapplybio-basedmaterialsinmorenewfields.CaseIn-depthUniversity-EnterpriseIntegrationRelyingonvariousscientificandtechnologicalinnovationplatforms,includingtheZJU-HengyiGlobalInnovationResearchCenter,theJointLaboratoryofDonghuaUniversityandHengyi,ChinaChemicalFibersAssociation-HengyiFoundation,theNationalPostdoctoralResearchStation,theNationalEnterpriseTechnologyCenterandtheKeyLaboratoryofTextileIndustry,Hengyiactivelyexpandsacademicexchangesandcooperationwithuniversityscientificresearchinstitutes.TheCompanyhasforgeddeeppartnershipswithprestigiousuniversitiessuchasZhejiangUniversity,DonghuaUniversity,NanjingTechUniversityandZhejiangSci-TechUniversity.Together,we'veestablisheda"government-enterprise-university"synergy,fosteringatalentdevelopmentmechanismacrosstheentirelifecyclebasedontheintegrationof"industry,academia,research,andapplication."Thiscooperationprovidesuniversitieswithtechnicalandfinancialsupportfortheapplicationoftheirresearchfindings.HengyiScholarsLaboratoryTheHengyiScholarsLaboratorycoversanareaof500squaremeters,boastingtop-notchfacilitiesandcutting-edgeequipment.Itencompassesvariousresearchdomainsfromcatalystmaterialstonationalstrategicneeds.Drawinginleadingscientistsandpromisingyoungtalentsathomeandabroad,thelaboratoryhasappointed5expertsandprofessorsasHengyiScholarsincludingXiaoFengshou,HouZhaoyinandChengYouweifromZhejiangUniversity,aswellasLiGuangandZhangQinghongfromDonghuaUniversity.LaunchceremonyofHengyiScholarsLaboratoryEngagementceremonyofHengyiScholars562023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.57Hengyicontinuestopromotethestrategyof"StrengtheningEnterpriseswithTalents",andiscommittedtostrengtheningtalentcultivationandcreatingAccumulatedstockpurchasesunderthefifthphaseoftheESPPMeanwhile,theCompanyfocusesontheemployees’occupationalhealthandsafetyandprovideshealthtrainingandconsultingactivitiestocreateaworkplaceconducivetoboththephysicalandmentalhealthtoenhanceteamcohesionandculturalidentity.Wearecommittedtocreatingaharmoniousandcozyatmosphereandsharingdevelopmentachievementswithemployees.Employees'RightsandInterestsOccupationalHealthandSafetyUnblockedGrowthChannelWarmcareforemployeesamountingtoRMB4.437sharespurchasedunderthefifthphaseoftheESPP366.84millionbillionemployeetrainingcoveragerate100%withEmployeesGrowingTogether2023ActionsandResponses582023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.59Employees'RightsandInterestsTheCompanyattachesgreatimportancetoemployees'rightsandinterestsprotection,strictlyabidesbyrelevantlawsandregulationsandadherestotheprinciplesoflawful,equalanddiversifiedemployment.Whilegraduallyimprovingtheremunerationandbenefitssystem,wecontinuouslyimprovetheCompany'sdemocraticmanagementsystem,establishchannelsforemployees'communication,andactivelybuildaharmoniousandstablelaborrelationship.RecruitmentandEmploymentTheCompanystrictlyabidesbytheLaborLaw,LaborContractLawandotherlawsandregulations,adoptsazero-toleranceattitudetowardschildlaborandforcedlabor,andalwaysadherestotheprinciplesoflawful,equalanddiversifiedemployment.Inaddition,theCompanyactivelybuildsadiversifiedworkforceandstrivestocreateahealthyandequalworkingenvironmentforallemployees.DataEmployeebenefitsTheCompanycontinuouslyimprovestheworkingconditionsandbenefitsforemployees,andeffectivelyprotectstherightsandinterestsofeveryemployeeinvariousaspects,suchasremunerationandbenefits,socialinsurance,vacationandleave,laborprotection,medicalcareandlifesupport,etc.In2023,thecoveragerateofsocialinsuranceforemployeeswas100%.EmployeesbyageEmployeesbygenderEmployeesbyethnicgroupsEmployeesbyeducationalbackgroundUnder29yearsold30-39yearsold40-49yearsoldOver50yearsoldCollegeandbelowBachelor'sDegreeMaster'sDegreePhDFemalesMalesEthnicminoritiestheHan74.0225.9894.39%5.61%1,7653,8585,3914,5341,95913,27123979RemunerationandBenefitsWehavedevelopedanadvancedandflexibleincentivemechanismandcompetitiveremunerationandbenefitsforouremployees,andhaveimplementedawagenegotiationmechanism,targetingscientificplanningforsalarygrowth,andinnovationinsalarycontrolmechanism,topromoteasteadyincreaseinthesalariesoffront-lineemployees.SocialInsuranceLaborSecurityLifeSupportWeensureallsocialinsurancearemadeontimeandinfull,andformulateseveralinsuranceplansforouremployees,suchasemployer'sliabilityinsurance,groupaccidentinsurance,employees'medicalmutualaid,supplementalmedicalinsurance,etc.toimprovetheriskprotectionofouremployees,andtosafeguardtheireconomicrightsandinterests.Weenhancesmartmanufacturingandstandardizeoperatingprocedurestoreducethelaborintensityofproductionfront-lineemployeeswhileeffectivelyprotectingemployees'rightstotakerestsandaskforleave,especiallyfront-lineemployees.Weprovideemployeeswithhousingallowance,canteenandmealsubsidies,workwear,freeshuttlebuses,etc.,sothatemployeescanliveandworkhappily.Turnoverratebyage35%41%8%16%-----Under29yearsold-----30-39yearsold-----40-49yearsold-----Over50yearsoldTurnoverratebygender-----Male-----Female31%69%EmployeeincentivesStayingtruetotheprincipleofwin-winforboththeCompanyandtheemployees,theCompanyadherestotheconceptof"advancingdevelopmentwithjointeffortsandsharedjoy",andendeavorstopooleveryone’senergiestoseekbenefitsforemployees,andcreatecommonprosperity.BasedontheconfidenceintheCompany'ssustainableandstabledevelopmentinthefutureandrecognitionofthelong-termvalue,theCompanyimplementedthefifthphaseoftheEmployeeStockOwnershipPlan(ESOP)in2023,whichfurthermobilizedtheenthusiasmandcreativityoftheemployeesthroughtheemployeestockownership,andatthesametimeimprovedthecohesionoftheemployeesandthecompetitiveness.Inaccordancewiththeprincipleofvoluntaryparticipation,thefifthphaseoftheEmployeeStockOwnershipPlancoveredatotalofapproximately3,600employeesofHengyianditssubsidiaries,wholly-ownedorholdingcompanies.ThetotalnumberofsharespurchasedunderthefifthphaseofESOPwas366.84million,amountingtoRMB4.437billion.Case15,548employeesintotal,571employeeswithdisabilities,737overseasemployees148femalesinmiddlemanagement602023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.61OccupationalHealthandSafetyWithahighprioritygiventothephysicalandmentalhealthofemployees,theCompanyhasformulatedtheRegulationsontheOccupationalHealthManagementandcontinuouslyimprovedtheinternalsystemrelatedtooccupationalhealthandsafety(OHS),andimplementedallaspectsinaccordancewiththenationalstandardsfromoccupationaldiseaseprotectionduringtheprojectconstructionperiodtodetectionofoccupationalhazards,occupationalhealthcheckups,notificationofoccupationalhazards,issuanceoflaborprotectiveequipment,trainingandeducation,removalofhiddendangers,establishmentofoccupationalhealthfiles,etc.duringtheoperationperiod.Duringthereportingperiod,our7subsidiarieshavepassedISO45001OccupationalHealthandSafetyManagementSystemCertification.Wesetupadrugstoreintheofficeareawhereallcommonmedicinesareprescribedandallkindsofhealthmonitoringinstrumentssuchasbloodpressuremetersfortheproductionworkshoparedistributed.Weorganizehealthcheckupsfornewandoldemployeesandemployeesofspecialworktypes,andconductvariouskindsofhealthlecturesandfreeclinicsfromtimetotime.Workers'CongressGrassrootspoliticalcommitteesvisitthesiteDemocraticmanagementTheCompanyhasestablishedandimprovedtheworkers'congresssystem,encouragedemployeestomakesuggestionsandbuiltdiversifiedcommunicationchannels,suchasworkers'congress,symposiums,questionnairesurveys,mailboxes,WeChatofficialaccountandvideosandotherchannelstorespondtotheirdemandsinatimelyandeffectivemanner.Wehavealsoestablishedthe"HengyiSeniors"grass-rootspoliticalcommitteemechanismanddeepenedthemechanismofsoundsuggestionstopromotethemanagementlevel.Theelected"HengyiSeniors"godeepintothefrontlines,listentoandcollecttheiropinions,participateingrassrootsgovernance,andcontinuetoprovideadviceandsuggestionsforenterprisemanagement.100%LaborUnionParticipation0CasesofOccupationalDiseaseCollectiveContractSigningRate100%UnblockedGrowthChannelHighlyvaluingtalentcultivationanddevelopment,theCompanyisdedicatedtobroadeningcareerdevelopmentchannels,providingemployeeswithdiversifiedandcustomizeddevelopmentpaths,andguaranteeingthatemployeesacquireknowledgeandskillsintheircareersandgrowwiththeCompany.BuildingastrongtalentpoolTheCompanyleveragesrichinternalandexternallearningresourcestopromotetalenttrainingandbusinessteamgrowth,andflexiblyadoptsacombinationofonlineandofflinetrainingprogramstobuildastrongtalentpool.“TalentReserveProject”——NewBlueProgramLecturesonIndustrialTechnologyHengyiUniversity’sOnlinePlatformIn2023,wesystematicallyrecruitedandtrainedmorethan100newcollegegraduates.Thetrainingcoverstopicssuchason-boardingtraining,factoryinternship,mentoring,businesstrials,andperiodicreview.Externalexpertswereinvitedtocarryoutaseriesoflectures,"IndustryLectureHall","LeanClassroom"andotherflagshipcourseswereorganized,coveringprocesstechnology,technologicalfrontiers,industrydynamicsandsoon.Front-lineemployeesareallowedtoworkwithcertifications,injectingmomentumintotheindustryadvancement.HengyiUnivesity’sonlineplatformhasbeenoperatingfor6years,withmorethan5,000learnersand370coursescoveringvariousdimensionssuchasprofessionalcompetence,leadershipandmanagement,generalability,andprofessionalknowledge.Ouremployees’onlinelearninghourshaveexceeded40,000hours.Weprovidedifferentprotectivegearsforemployeesaccordingtodifferentjobtypesandlaborenvironments,andsupervisetheuseoflaborprotectiongearsonsiteeveryday.Weregularlycarryouteducationandtrainingactivitiesonthepreventionandcontrolofoccupationaldiseasestoeffectivelyimproveemployees'skillsofprotection.Weformulateanannualplanformonitoringoccupationaldiseasehazardsintheworkplace,setupmonitoringpointsforsuchhazards,andfiletheevaluationresults.100%OHSParticipation100%PhysicalExaminationCoverage100%Health&SafetyTrainingCoverage116hoursAnnualtraininghoursperemployee100%Trainingcoveragerate622023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.63OpeningupcareerdevelopmentchannelsTheCompanyhasestablishedathree-channelcareerdevelopmentpath,andformulatedtheJobManagementSystemtocontinuouslybroadenchannelsformanagement,professional,andoperationaltalents.Wehaveadoptedadifferentiatedevaluationmechanism.Onthepremiseofensuringfairpromotionopportunitiesandimprovingscientificandrationalevaluation,weaimtoachievescientificrecruitmentpracticesandempoweremployeestorealizetheirlifevaluesanddreams.StandardizingjoblevelmanagementandunblockingtalentdevelopmentchannelsTheCompanyhasestablishedthreetalentseries:management,professional,andoperational,encouragingcross-appointmentamongtalents.Specifically,themanagementincludes11joblevels,10fortheprofessional,and4fortheoperationalstaff.Eachyear,theCompanyformulatesanannualemployeepromotionplanbasedonthedevelopmentplans,staffing,jobsituations,andneedsofeachfunctionaldepartment/subsidiary,aswellasthedevelopmentoftheemployees.Additionally,onthebasisoftheplan,weorganizetheevaluationforpromotionsandjobappointmentsthroughorganizationalrecommendations,opencompetitions,andself-nominationsofemployeesetc.Thisprocessinvolvesthedeterminationandadjustmentofjoblevels.CaseContinuingEducationoffrontlinestaffVocationalAptitudeTestTheCompanyhaspartneredwithZhejiangUniversityofTechnology,ZhejiangRadioandTelevisionUniversity(XiaoshanCollege),technicalschoolsandothercollegestosetupacademicupgradingclasses,providingemployeesinvariouspositionswiththeopportunitytofurthertheireducation,andcultivatingagroupof"HengyiCraftsmen".RelyingonthefirstbatchofpilotunitsofnationalvocationalskilllevelcertificationinXiaoshanDistrict,theCompanysystematicallycarriesoutinternalcertificationforemployees,promotestrainingthroughcompetitions,andorganizestechnicalcompetitions.Uptonow,morethan4,000peoplehavebeencertificated,and715employeeshaveobtainedvocationalskillscertificationin2023.NewBlueProgramVocationalAptitudeTestSkillCompetitionsCultivationofProfessionalSalesForceThroughtrainingonproductknowledge,salescasedevelopment,andsalescasecompetitions,wehaveproducedsalesproductcourses,typicalcasesandcourses,cultivatedthesalesforceintointernallecturerstoincreasetheircompetence,andimprovedthetalentcultivationsystem.WarmcareforemployeesTheCompanyiscommittedtobuildingthe"HengyiFamily"cultureandcreatingdifferentculturescoveringteambuilding,seniority,workers’familyanddormitory.Weestablishmorethan10associations,suchascalligraphy,paintingandphotographyclubs,andregularlyorganizethe"HengyiCup"BasketballLeagueandathleticgames,aswellasaseriesofeventssuchastheApartmentNeighborhoodFestival,andthe"LoveEachOther"YouthDating,toboostemployeehappinessindex,enhancethecohesionandcentripetalforceoftheenterprise.ThishelpstheCompanynotonlybecomeacareerplatformforemployeestogrow,butalsoaspiritualhomethatcarrieshappinessanddreams.OrganizingdiversifiedactivitiesCaseApartmentNeighborhoodFestival"HengyiCup"BasketballLeagueSettingupthe“Mommy’Hut”CaseIn2023,ZhejiangYisheng,asubsidiaryofHengyi,setupa“Mommy’Hut”toprovideasafe,comfortableandrestingplaceforpregnantandbreastfeedingfemaleemployees,andwasawardedthe"Four-starMommyHut"inBeilunDistrict.CaringforemployeeswithdisabilitiesCaseTheCompanydeclaresmutualmedicalcareandfreemedicalcheckupsforalldisabledemployees,andsignsacontractwithYaqianTownshipHealthCenterforthe"FamilyDoctor"program,sothatdisabledemployeescanbenefitfrommedicaltreatment.Besides,theCompanydeclarescharitableaidfordisabledemployeesindifficultyandvisitsthemtosecuretheirnormalworkandlife.TheCompanycontinuestoholdquarterlygeneralmeetingsforemployeeswithdisabilities,andconductsseminarsforteamleaderstobeinformedoftheirworkingstatusanddifficulties.Accordingtotheirdifferentphysicalconditions,wearrangesuitablejobsfordisabledemployeesandopensgreenchannelsforthemintheirworkandlife.OnChinaLodineHelptheDisabledDay,theCompanycarriesoutaseriesofcultural,sports,trainingandotheractivitiestoenrichthesparetimelifeofemployees,andselects10"Self-improvementStars"andawardedthemmaterialandspiritualhonors.642023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.65Committedtothecharitycause,theCompanyactivelyparticipatesinvolunteerservices,educationdonations,communitybuildingandothertypesofpublicactivitiesandprovidesassistanceforgroupsinneedofhelp.Topromotethehealthydevelopmentofthecommunity,wewillinglyshoulderourresponsibilities,andcontributeoureffortstoaharmoniousandbettersociety.RuralVitalizationCommunity。
7. CharityContributiontotheBRIdonatedtotheRedCrossSocietyofChinaWuzhongBranch,Ningxiain2023participantsintheblooddonationsince20022023ActionsandResponsesmillion65,628cumulativedonations30milliondonatedtoBeilunDistrictCharityFederationin2023700,0001,556,400mlblooddonatedintotalCommunityWithASharedFutureBuildingHarmonious662023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.67RuralVitalizationCommunityCharityTosupportruralrevitalizationandcommonprosperity,theCompanyleveragesitsserviceexpertisetoassistpeopleinunderdevelopedareasandthesurroundingregionsbycontinuouslyinvestingineducationassistanceandindustrialvitalization.Thankstotheseefforts,thoseunderdevelopedareascanactontheirown,stimulatingthedevelopmentpotentialofthecountryside.TheCompanyfocusesonshapingfriendly,mutualhelp,civilizedandharmoniousneighborlyrelationstocreateaharmoniousandstablesocialandhumanisticenvironment.Wehavecarriedoutaseriesofcharitableprojectsformanyyearsbysponsoringstreetculturalactivities,andactivitiesinthesurroundingcommunitiesandschools.Employeesareencouragedtoparticipateinawiderangeofpublicactivities,contributingtheireffortstoaharmonioussociety.SupportingeducationvitalizationDiversefundsestablishedtosupportcharityVoluntaryBloodDonationTheCompanyhasincreaseditssupporttodrivetheeducationaldevelopment.RMB6millionwasdonatedtotheRedCrossSocietyofChinaWuzhongBranch,Ningxiain2023fortheconstructionofHongdeHopeSchoolinHongsibaoDistrict,WuzhongCity,Ningxia,andthecumulativedonationhasreachedRMB30million.Allthedonationsfortheprojecthavebeencompleted,pushingforwardtheconsolidationoftheresultsofpovertyalleviationandruralvitalization.Since2016,theCompanyhasestablishedfundsforenvironmentalprotection,neweracivilizationpractice,"commonwealthandhappyhome"speciallyusedforassistanceofthepeopleinneed,studentaid,medicalcareandenvironmentalprotectionprograms,volunteerservicesandvillage-enterprisepairingassistance,etc.ThetotalamountofdonationstotheBeilunCharityFederationin2023reachedRMB700,000.OnAugust2,2023,Hengyiheldthe22ndcollectiveblooddonationactivity.265employeesdonated88,010mlofbloodonthatday,interpretingresponsibilityandlovewithaction.Overthe22yearssince2002,whenHengyifirstorganizedthecollectiveblooddonationactivityforitsemployees,theCompanyhasactivelycalledforandcarriedoutblooddonationactivitiesinanorderlymanner,andatotalof5,628employeeshavecontributedtheireffortstoblooddonation.CaseCaseCaseContributiontotheBRITheCompanyembracesthenational"BeltandRoad"Initiative(BRI)bydelvingintothedevelopmentneedsofcountriesalongtheroute.Leveragingourresources,weactivelycontributetothedevelopmentofthe"BeltandRoadInitiative",helpingChineseenterprisesestablishtheirglobalpresence.BuildingtheHengyi(Brunei)PMBPetrochemicalProjectasanexampleoftheBRITheHengyi(Brunei)PMBPetrochemicalProject,acollaborativeeffortofHengyi,theBruneigovernmentanditspeople,standsasthepioneeringprivaterefineryandchemicalprojectforHengyiaswestriveforinternationalproductioncapacityandtheimplementationofChina's"BeltandRoad"Initiative.ThisprojectisamongthefirstgroupofkeydevelopmentprojectsundertheBRI.In2023,theprojectwasselectedintothelistofTop100BestPracticesoverthePastDecadeoftheBeltandRoadCooperationbyChineseListedCompaniesbytheChinaAssociationforPublicCompaniesin2023.Hengyi(Brunei)PMBPetrochemicalProjectCase682023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.69LocalMarketDevelopmentLocalTalentsCultivationTheCompanyleveragesitsindustrial,managerial,andconstructionstrengthstocontinuouslyexplorepathwaysforlocalproductionandoperations.WefocusonimplementingstrategiesandplanninginBruneianditsneighboringregions,withMalaysiaandSingaporeservingascoreprocurementmarkets.Emphasizinglocalizedprocurement,weactivelyconducttrainingforcontractorvisitorstodeepenoperationallocalizationandfirmlyestablishourpresenceinthelocalmarket.TheCompanycarriesouta"university-college-enterprise"modeltotrainlocalpetrochemicaltalentsinBrunei.Wehavespecificallypromotedtheestablishmentofthreespecializedtalentdevelopmentprograms:the"ZhejiangUniversity-UniversitiBruneiDarussalamJointTrainingProgram",the"InstituteofBruneiTechnicalEducation(IBTE)andLanzhouPetrochemicalUniversityofVocationalTechnology(LPP)JointTrainingProgram",andthe"InstituteofBruneiTechnicalEducation(IBTE)andHengyiIndustriesJointTrainingProgram".TheseinitiativesofferfullscholarshipsandaimtonurturepetrochemicaltalentsatvariouslevelswithinBrunei.SupportingtheLocalProductExpo2023AsoneofthesponsorsoftheBrunei’sLocalProductExpo,theCompanysupportstheLocalProductExpo2023bysponsoringboothsfor10localmicroandsmallenterprisestopromotethedevelopmentoflocalindustries.CaseTheZJU-UDBJointTrainingProgramforfirst-yearchemicalengineeringstudentsatUBDhasenrolledatotalof187studentsin11sessionsasoftheendofthereportingperiod,ofwhich117wereemployed.TheIBTE-LPPJointTrainingProgramhasenrolledatotalof142studentsin5sessionsasoftheendofthereportingperiod,ofwhich47wereemployed.UBD-ZJUScholarshipProgramIBTE-LPPScholarshipProgramDataAtotalof2,699overseascontractorsinvitedtocomplete77visits,exchangesandsafetytrainingbasedontheneedsoftheCompany'soverseascontractorsPublicWelfareOverseasHengyiisactivelyfulfillingitscorporatesocialresponsibilitybysettinguptheCSRCommitteeandCSRFund.Operatinginastandardizedandtransparentmanner,theCompanyfocusesonkeyareassuchaspovertyallevation,educationdevelopment,andsocialwelfare.Weengageinoverseasphilanthropicendeavors,contributingtothefriendshipbetweenChinaandBrunei.CharityinRamadanSupportingYASKAHopeinMotioncharityobstaclerunRamadandonationisapartofHengyiCaresInitiative,acorporatesocialresponsibilityendeavorthatisdesignedtogivebacktosocietyandalleviatetheburdensofthoseinneed,includingfamiliesandorphans.ThroughouttheRamadanperiod,theCompanymobilizedemployeestovisitlocalcommunitieswithpairedassistance,providingcomfortgoodstoimpoverishedfamilies.Specifically,donationsweremadeto8strugglinghouseholdsand10orphansinSerasavillage.AsthetitlesponsorofYaskaBrunei'scharityevents,theCompanyhasparticipatedinmanysocialinitiativessuchasraisingfundsforBrunei'scancer-strickenchildren,whichisanimportantpartoftheHengyiCaresInitiative.CaseCaseLocalEducationProgramsinBruneiHengyiIndustriesSdnBhdcooperatedwithPoliteknikBrunei(PB)andIBTEtooffer8petrochemical-relatedmajors,with576studentsenrolledasoftheendofthereportingperiod,ofwhich41wereemployed.702023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.7170ProspectsWefocusonourongoingdedicationtosteerabrightfuture.2024marksthe75thanniversaryofthePeople’sRepublicofChina.Itisalsoacrucialyearforimplementingthe14thFive-YearPlan.Hence,thesignificanceofperformingallourtaskscannotbeoverstated.Movingforward,HengyiwillsteadfastlyadvancetheGroup’smissionof“buildingacentury-old,evergreenfoundationandstandamongtheworld'srenownedenterprises”.Upholdingtheprincipleof“RelentlessPursuitofExcellence”,wewillenhanceourhigh-qualitydevelopmentlevelandoverallstrength.Focusedoncultivatinghigh-tech,high-efficiency,andsuperior-qualitynewqualityproductiveforces,weaimtopropelChinesemodernizationwithinnovativeconceptsforanewera.Wechampiongreenandlow-carbonphilosophyinharmonywithnature.Wewillremaindedicatedtogreen,low-carbon,andsustainabledevelopmentthatprioritizesenvironmentalprotectionasfundamentaltooursustainability,continuallyaligningourproductionwiththesurroundingnaturalecologytocreategreenfactories.Whileensuringouroperationalandenvironmentalperformance,wewillimproveenvironmentalconditionsaroundourfactoriesandexplorestrategiesforcarbonreductionandresourcemanagement.Whileactivelyaddressingclimatechange,throughecologicalcompensationandrestorationprojects,wewillprotectbiodiversityandgreenecology,consistentlyfulfillingourenvironmentalprotectionresponsibility.Wepromisetooffersuperiorservicesandtrustworthyquality.Upholdingartisanalexcellenceandcustomer-centricprinciple,wewillfurtherboostcomprehensivequalitymanagementandmaintainstrictsafetystandards.Byincreasingourinvestmentintechnologicalinnovation,wewilldeepenourstrategicfocusongrowingintoatechnologicalHengyi.Wewillimproveourcustomerservicesystemandelevateourservicequalityandefficiencytosatisfydiversecustomerneeds.Throughhigh-qualityandhigh-valueproducts,weaspiretoinvigoratethehigh-qualitydevelopmentofbothHengyiandtheindustrywithfreshenergyandmomentum.Weaspireforabettersocietyviawin-winendeavors.Embracingmutualbenefit,werespectthevalueofeveryemployee,ensureequalemployment,careforemployees,andunblocktheirgrowthchannels.Wearededicatedtobuildingaresponsiblesupplychain,enhancingsuppliercompliancemanagement,andfosteringatransparent,responsiblesupplychainecosystemwithoursuppliers.Wewillpromoteandorganizediversepublicwelfareactivities,payattentiontoandboostlocalemploymentandindustrydevelopment,contributingtoruralvitalizationandaharmonioussociety.71722023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.73IndicatorUnit202120222023Operatingincomebillion129152.1136.1Totalassetsbillion105.5112108Productioncapacity10,000tons3,8473,8774,161.5-Chemicals10,000tons265265265-Refinedoil10,000tons565565565-PTA10,000tons1,9001,9002,150-PIA10,000tons303030-Polyesterfiber10,000tons777807751.5-PET（includingRPET）10,000tons270270360-Caprolactam10,000tons404040Qualityinspectionpassrate%100100100Customersatisfactionaftersales%959799ESGKeyPerformanceAppendixEconomicPerformanceSocialPerformanceIndicatorUnit202120222023Totalnumberofemployeesheadcount16,82015,63715,548Percentageoffemaleemployees%26.1726.3725.98Laborcontractsigningrate%100100100Socialinsurancecoverage%100100100Percentageofethnicminoritiesemployees%6.457.155.61Femaleinseniormanagementheadcount332Femaleinmiddlemanagementheadcount165162148Totalamountofemployeestockownershipplanbillion13.9313.9344.37Totalsharespurchasedshare113,754,600113,754,600366,840,000BenefitedemployeesheadcountApproximately4,000Approximately4,000Approximately8,000Traininghoursperemployeeperyearhour10498116Occupationalhealthexaminationcoverage%8080100Reportedaccidentscase000Fatalitiesfromsafetyaccidentsheadcount000Safetytraininghoursperemployeehour121215EnvironmentalPerformanceIndicatorUnit202120222023Carbondioxideemissions10,000tons909911809Carbondioxideemissionsintensitymilliontons/RMBbillion0.070.060.06Consumptionofcrudeoil10,000tons828864819Consumptionofnaturalgas10,000cubicmeters4,6014,4434,120Consumptionofelectricity10,000kWh763,655649,377355,412Consumptionofcoal10,000tons205210280Consumptionofcoalwaterslurry10,000tons694126Photovoltaicpowergeneration10,000kWh2,5804,4206,514Emissionintensityofmercuryanditscompoundsmg/m30.00000760.0000430.000070Notes:Carbondioxideemissionsintensity=Carbondioxideemissions/OperatingrevenueThedatafor2021and2022donotincludeZhejiangYishengandHengyiBrunei.Startingfrom2023,thecompanywillincludethesecompaniesinthescopeofdisclosure.742023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.75GRIStandardsPageGRI2GeneralDisclosures2-1OrganizationdetailsP7-P92-2Entitiesincludedintheorganization’ssustainabilityreportingP32-3Reportingperiod,frequencyandcontactpointP32-4RestatementsofinformationP92-6Activities,valuechainandotherbusinessrelationshipsP7-82-7EmployeesP56-P632-9GovernancestructureandcompositionP12-P132-10NominationandselectionofthehighestgovernancebodyP132-11ChairofthehighestgovernancebodyP132-12RoleofthehighestgovernancebodyinoverseeingthemanagementofimpactsP132-16CommunicationofcriticalconcernsP132-26MechanismsforseekingadviceandraisingconcernsP15-162-27CompliancewithlawsandregulationsP142-29ApproachtostakeholderengagementP22-23GRI3MaterialTopics3-1ProcesstodeterminematerialtopicsP20-P213-2ListofmaterialtopicsP213-3ManagementofmaterialtopicsP21GRI201EconomicPerformance201-1Directeconomicvaluegeneratedanddistributed/201-3DefinedbenefitplanobligationsandotherretirementplansP9GRI203IndirectEconomicImpacts203-1Infrastructureinvestmentsandservicessupported/203-2Significantindirecteconomicimpacts/GRI205Anti-corruption205-1OperationsassessedforrisksrelatedtocorruptionP15205-2Communicationandtrainingaboutanti-corruptionpoliciesandproceduresP15205-3ConfirmedincidentsofcorruptionandactionstakenP15GRI302Energy302-1EnergyconsumptionwithintheorganizationP27-28302-3EnergyintensityP27-28ReportContentIndexesGRIContentIndexGRI303WaterandEffluents303-2Managementofwaterdischarge-relatedimpactsP32,P33303-3WaterwithdrawalP32303-4WaterdischargeP33303-5WaterconsumptionP32GRI305Emissions305-4GHGemissionsintensityP27305-7Nitrogenoxides(NOx),sulfuroxides(SOx),andothersignificantairemissionsP33GRI306Waste306-1Wastegenerationandsignificantwaste-relatedimpactsP34-P35306-2Managementofsignificantwaste-relatedimpactsP34306-3WastegeneratedP35306-4WastedivertedfromdisposalP35306-5WastedirectedtodisposalP35GRI401Employment401-1NewemployeehiresandemployeeturnoverP59401-2Benefitsprovidedtofull-timeemployeesthatarenotprovidedtotemporaryorpart-timeemployees.P58-P59GRI403OccupationalHealthandSafety403-1OccupationalhealthandsafetymanagementsystemP60403-2Hazardidentification,riskassessmentandincidentinvestigationP60-P61403-3OccupationalhealthservicesP60-P61403-5WorkertrainingonoccupationalhealthandsafetyP42-P43403-6PromotionofworkerhealthP38-P43,P60-P61403-7PreventionandmitigationofoccupationalhealthandsafetyimpactsdirectlylinkedbybusinessrelationshipsP38-P43403-8WorkerscoveredbyanoccupationalhealthandsafetymanagementsystemP60403-9Work-relatedinjuriesP38403-10Work-relatedillhealthP60-P61GRI404TrainingandEducation404-1AveragehoursoftrainingperyearperemployeeP61404-2ProgramsforupgradingemployeeskillsandtransitionassistanceprogramsP61-P62GRI405DiversityandEqualOpportunity405-1DiversityofgovernancebodiesandemployeesP13,P58762023Environmental,Social,andGovernance(ESG)ReportHengyiPetrochemicalCo.,Ltd.77GRI409ForcedorCompulsoryLabor409-1Operationsandsuppliersatsignificantriskforincidentsofforcedorcompulsorylabor/GRI413LocalCommunities413-1Operationswithlocalcommunityengagement,impactassessment,anddevelopmentplansP66-P69413-2Operationswithsignificantactualandpotentialnegativeimpactsonlocalcommunities/GRI414SupplierSocialAssessment414-1NewsuppliersthatwerescreenedusingsocialcriteriaP48GRI416CustomerHealthandSafety416-1AssessmentofthehealthandsafetyimpactsofproductandservicecategoriesP43-P45CodeIndicatorPageRT-CH-110a.1GrossglobalScope1emissions,percentagecoveredunderemissions-limitingregulationsP27RT-CH-120a.1Airemissionsofthefollowingpollutants:(1)NOX(excludingN2O),(2)SOX,(3)volatileorganiccompounds(VOCs),and(4)hazardousairpollutants(HAPs)P33RT-CH-130a.1(1)Totalenergyconsumed,(2)percentagegridelectricity,(3)percentagerenewable,(4)totalself-generatedenergy2P27-28RT-CH-140a.1(1)Totalwaterwithdrawn,(2)totalwaterconsumed,percentageofeachinregionswithHighorExtremelyHighBaselineWaterStressP32RT-CH-140a.3DescriptionofwatermanagementrisksanddiscussionofstrategiesandpracticestomitigatethoserisksP32RT-CH-150a.1Amountofhazardouswastegenerated,percentagerecycled-RT-CH-210a.1DiscussionofengagementprocessestomanagerisksandopportunitiesassociatedwithcommunityinterestsP66RT-CH-320a.1(1)Totalrecordableincidentrate(TRIR)and(2)fatalityratefor(a)directemployeesand(b)contractemployeesP60RT-CH-320a.2Descriptionofeffortstoassess,monitor,andreduceexposureofemployeesandcontractworkerstolong-term(chronic)healthrisksP60-P61RT-CH-410b.2Discussionofstrategyto(1)managechemicalsofconcernand(2)developalternativeswithreducedhumanand/orenvironmentalimpactP50-P52RT-CH-530a.1Discussionofcorporatepositionsrelatedtogovernmentregulationsand/orpolicyproposalsthataddressenvironmentalandsocialfactorsaffectingtheindustryP31RT-CH-540a.1ProcessSafetyIncidentsCount(PSIC),ProcessSafetyTotalIncidentRate(PSTIR),andProcessSafetyIncidentSeverityRate(PSISR)P38SASBIndexFeedbackSheetDearreaders,Thankyoufortakingthetimetoreadthe2023ESGReportofHengyiPetrochemicalCo.,Ltd.amidstyourbusyschedule.ToprovidemorevaluablecontenttostakeholdersandkeepimprovingourreportpreparationandESGperformance,wesincerelyinviteyoutoleaveyouropinionsandsuggestionsbythefollowingways1.ForHengyi,whatcategoryofstakeholdersdoyoubelongto:2.Youevaluationofthisreport:3.WhatotheropinionsorsuggestionsdoyouhaveregardingthisreportorourCSRpracticesTel.:E-mail：Address：□Government□Shareholder/Investor□Employee□Customer□Supplier□Thepublic□□Socialorganization/non-governmentalorganizationAcademic/researchinstitutionsIndustryassociation/partner□□Media□Other()ReportstructureWordingInformationdisclosureLayoutdesignOverallevaluationVerygoodGoodAveragePoor□□□□□□□□□□□□□□□。
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