CSR Report 2022 - Sichuan Jinxing Yidu Building Materials Co., Ltd.

Sichuan Jinxing Yidu Building Materials Co., Ltd. was established in 2007 as a national high-tech enterprise specializing in R&D, manufacturing, sales, construction engineering, and technical services for building waterproofing and thermal insulation materials. We provide comprehensive waterproofing system solutions for large-scale infrastructure projects such as high-speed rail, metro lines, highways, tunnels, airports, civil and industrial buildings, and utility corridors. As a leading supplier of waterproofing systems in Southwest China, we offer one of the most diverse product portfolios and advanced technical capabilities in the region.

As a company located in a city (prefecture) recognized for steady industrial growth and successful transformation and upgrading, our mission is to strengthen innovation capacity and develop high-tech industries. We are building a high-level innovation platform focused on waterproofing membrane research and implementing four strategic initiatives: talent development, sustainable development, revitalization of industry leaders, and technical standardization. Through continuous research on waterproofing membranes and related technologies, we have developed a series of core composite material technologies with independent intellectual property rights. We continue to launch high-tech, high-value-added products, accelerating industrialization and scale-up. At the same time, we are increasing investment in R&D to enhance our innovation capabilities and intellectual property acquisition, cultivating and expanding our innovation teams. This supports a virtuous cycle of talent, technology, and economic development. We promote integrated industry-academia-research collaboration, aiming to become a leading domestic R&D base in waterproofing technology, driving technological advancement, talent cultivation, technology transfer, and industrial upgrading within our company and the province.

We uphold the philosophy of 'Leading a Green Future.' Our achievements include being recognized as a National High-Tech Enterprise, ranked among China's Top 500 Building Materials Companies, one of China’s Top 20 Construction Waterproofing Enterprises, a National Leader in Building Materials Quality, a Sichuan Province 'Specialized, Precise, Unique, and Innovative' Small and Medium-Sized Enterprise, the 2021 Sichuan Provincial 'Honest Enterprise,' a Sichuan Provincial Famous Product, and a Sichuan Provincial Well-Known Trademark. All our product lines have obtained China Environmental Label Certification and Green Building Material Certification.

I. Prioritizing Employee Growth and Protecting Employee Rights

We adhere to equal consultation and formal labor contract agreements, using various channels—such as forums, grassroots surveys, and employee WeChat groups—to actively gather employee feedback. For key issues concerning employee welfare, workplace safety, labor protection, and training management, we ensure transparency through multi-level and wide-ranging communication, enabling clear policy dissemination and open dialogue.

(1) Improving Management Selection Procedures and Building a Fair Competitive Environment

To broaden career development paths, we continuously refine our management selection and appointment processes, fully engaging all employees’ initiative and enthusiasm to identify, cultivate, and retain talent. We foster a fair, impartial, and transparent competitive culture within the company. Key measures in talent development include:

1. Annual job promotion competitions for core positions, where incumbent staff participate via performance reports, establishing a 'merit-based promotion and demotion' mechanism.

2. Enhancing and implementing talent development programs for management, technical, and operational roles.

3. Clearly defining promotion criteria and methods for all managerial and technical positions, conducting annual evaluation sessions to reward excellence and eliminate underperformance, thus optimizing talent utilization.

4. Establishing incentive mechanisms for talent development to boost motivation among both mentors and trainees.

5. Implementing mentorship programs for new hires to ensure rapid job proficiency.

6. Creating a support system for external talent, offering preferential treatment in housing, vacation, family visits, and compensation to attract and retain skilled professionals.

(2) Conducting Employee Training to Enhance Skill Levels

Based on business development and operational needs, we conducted various training programs according to our annual plan. In 2022, we organized 24 internal training sessions for department-level and above staff, involving 639 participants. These sessions enhanced the skills of key technical personnel. A working group was established to guide implementation. Employees received training and exams on safety and occupational health; watched 7 safety education videos; participated in 4 fire drills and comprehensive emergency exercises, totaling 239 attendees. Regular inspections were conducted, with corrective actions taken for identified safety hazards and hygiene issues. All employees took part in protective gear experience sessions. Additionally, the company union organized practical skill competitions tailored to real operational needs.

(3) Refining Performance and Compensation Systems with Salary Increases

To further standardize performance management, we aim to build core competitiveness through continuous improvement, fostering a competitive environment between high and low performers to support overall business goals. Since 2019, we have adopted a 'same position, different pay' performance system, clearly defining evaluation standards for high and low performance levels. The Human Resources Department conducts regular performance coaching across departments, integrating performance management into team-building practices. We launched performance evaluation campaigns, significantly improving team performance management effectiveness.

To maximize the motivational impact of compensation, since 2020, we have introduced the Rationalization Proposal Award and Special Contribution Award, with three tiers—first, second, and third prizes—based on the benefits generated by suggestions or the magnitude of special contributions.

(4) Continuously Focusing on People’s Livelihoods and Creating a Comfortable, Harmonious Work Environment

First, we organized summer cooling activities, distributing items such as Banlangen granules, Huoxiang Zhengqi liquid, cooling oil, and mung bean soup to employees. Second, we carried out assistance and visitation activities for hospitalized employees, elderly party members, and underprivileged students, providing relief and support. Third, we organized cultural and sports events for International Women’s Day and Labor Day. Fourth, we strictly enforce the 8-hour workday and 40-hour weekly schedule, along with paid leave policies. Employees working overtime on statutory holidays receive legally compliant compensation. For those unable to follow fixed schedules due to work demands, we apply comprehensive or flexible working hour systems. Leave for public holidays, maternity leave, and bereavement leave are granted in full compliance with national regulations.

(5) Upholding Scientific Rights Protection and Building a Harmonious, Win-Win Labor Relationship

1. Strengthening legal and policy education to further improve democratic management. We continue organizing study sessions for union members on laws such as the Trade Union Law and the Law on the Protection of Women’s Rights, enhancing employees’ awareness and engagement in corporate democratic governance.

2. Deepening factory affairs openness and democratization, gradually institutionalizing and standardizing the process. Under comprehensive leadership and regular discussions, we address challenges promptly. To make factory affairs openness a true ‘people-serving’ initiative, we follow the principle of ensuring employees ‘know the company, manage company affairs, and supervise company operations.’ We integrate openness into team building, addressing employees’ top concerns through pre-shift meetings, team discussions, heart-to-heart talks, and team learning sessions.

3. Further advancing factory affairs openness: First, strengthening democratic management systems to lay a solid foundation. We ensure full implementation of delegates’ rights, safeguarding employees’ right to know and participate in company development. For matters affecting employees’ interests, thorough assessments are conducted to ensure representatives effectively monitor major labor issues and critical decisions. Second, establishing robust democratic management mechanisms and a coordinated working structure involving Party leadership, joint responsibility from administration and Party committees, cross-departmental collaboration, and broad employee participation. Third, monitoring implementation rigorously to improve quality. We establish a closed-loop workflow: ‘establishing rules → standardized operation → evaluation criteria → strict supervision → corrective improvements,’ promoting continuous self-improvement and healthy development of democratic systems. Fourth, stimulating intrinsic motivation for democratic management and enhancing practical outcomes. We constantly enrich digital tools such as ‘Internet +’ democracy and information disclosure, improving accessibility, flexibility, and interactivity, so employees gain more value and satisfaction during participation.

4. Continuously standardizing equal consultation and labor contract systems. We maintain alignment between equal negotiation and contract signing, comply with the Labor Law and other relevant laws, and adapt to the company’s actual development needs. We continuously improve collective contract quality. We reinforce contractual accountability, ensuring inspection, oversight, and enforcement of contract performance, thereby enhancing the seriousness and credibility of labor contracts.

II. Giving Back to Society and Fulfilling Corporate Social Responsibility

(1) Promoting Low-Carbon Emissions and Building a Green Home

For years, we have been committed to land conservation, waste recycling, non-toxic raw materials, and clean production. We have increased environmental investments to build a green enterprise. By using low-noise fans and motors, we reduce noise pollution. Automatic soundproof and dust-proof roller shutters are installed in workshops and warehouses, minimizing disturbance to surrounding residents and reducing occupational risks for inspectors.

The company’s total green space ratio reaches 16.58%, with established management systems and regionalized greening responsibilities. We have developed an Emergency Response Plan for Sudden Environmental Incidents and strictly comply with environmental warnings issued by regulatory authorities. We publicly disclose environmental monitoring data.

Guided by our core philosophy of ‘Quality Assurance with Reduced Consumption, Green Development,’ we strive to become a resource-saving, environmentally friendly, innovative, and socially responsible enterprise. We place high importance on greening the factory and surrounding areas. To enhance overall landscaping, we divide the green zones among departments for management. Drought- and cold-resistant plant species are used, achieving optimal ecological efficiency at minimal cost, resulting in a well-balanced, layered landscape with varied density and height.

In 2022, we achieved a 100% disposal rate for solid waste through recycling and outsourcing to qualified entities, realizing multiple social benefits through waste resource recovery—benefiting both the nation and its people. This also played a significant role in regional solid waste management and urban development.

(2) Participating in Public Welfare and Giving Back to Society

Engaging in public welfare and giving back to society is a vital way modern enterprises fulfill their social responsibilities. While growing our business, we actively contribute to communities through various initiatives, creating added social value while building a positive brand image and achieving a balance between business success and societal benefit.

We pay corporate taxes regularly, contributing to local economic development. In 2022, our strong business performance continued to support regional growth.

We actively participate in social public welfare. In 2022, our employees joined multiple efforts including pandemic response, donations to children in need and underprivileged students, voluntary blood donation, and caring for senior party members.

III. Sustainable Development

Under the strong support of governments at all levels and the leadership of our management team, we are actively driving the transformation of old and new growth drivers, exploring green, intelligent, and environmentally friendly upgrades, expanding our vision, keeping pace with the times, continuously challenging ourselves, and pushing for faster and better enterprise development. We are committed to generating excellent economic, environmental, and social benefits, making even greater contributions to local economic growth!

Sichuan Jinxing Yidu Building Materials Co., Ltd.

July 12, 2023