Continue to improve the ESG governance system to build a more resilient future

As early as the beginning of the listing, Industrial Fulian has raised ESG as an important part of the sustainable development strategy to the top management of the company. In recent years, the company’s ESG construction has entered a fast lane. In May 2023, Industrial Fulian released the corporate Social responsibility (CSR) report for the fifth consecutive year to continuously optimize the company’s ESG governance structure, improve management effectiveness and reduce operational risks.

In early July, the company completed the election of a new board of directors, and the current board of directors of the company increased from the original six to seven people. Among them, the number of independent directors increased from 2 to 3, and the proportion increased from 33% to 42%. Two out of three independent directors are women, and the proportion of female directors has risen from 17% to 28%. The members of the new Board of Directors are diverse in terms of gender, educational background and professional skills, which further enhances the diversity and risk resistance of the company’s board of directors, especially the introduction of independent directors in the field of environment and dual carbon, which also shows the company’s determination to continue to strengthen ESG work.

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With its continuous efforts in the field of ESG, Industrial Fulian has been highly recognized by domestic and foreign rating agencies. In the 2022 international rating, MSCI upgraded the company’s ESG rating to BBB, three levels in two years; Morningstar’s ESG risk rating was lowered to 18 points, placing it at low risk. S&p CSA rating performance is better than 92% of global peers; CDP obtained a Grade B in its first carbon disclosure assessment.

In terms of domestic rating, the company’s Hang Seng ESG rating has maintained A level for four consecutive years, ranking in the top 10% of the industry; China Securities ESG rating was rated A, ranking the top 12% in the same industry; Runling Global ESG rating was rated A, ranking top 1.7% among A-share listed companies.

Thanks to the emphasis on ESG work and excellent performance, in the first half of 2023, Industrial Fulian won a number of ESG honors, including being selected for the first time in Fortune China ESG Influence List and CDP Supplier Cooperation Rating Leader List; It has won four public welfare awards such as “2022 Top 500 Chinese Corporate Philanthropy”, ESG Practice Excellence Award for Chinese Listed companies, “New Fortune” “Best Listed Company” and “Best ESG Practice” and a series of awards.