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Chairman & CEO's message

2020 is set to be remembered as a very unusual year in history. During the year, the sudden Novel Coronavirus Pneumonia (COVID-19) pandemic delivered a far-reaching impact on politics, economies, people’s lives and sustainable development in all countries around the world, and it produced a direct impact on CIMC Group as well. In the face of this challenge, we fully assessed the situation and took quick action. In April 2020, we set up the Group Decision-making Committee for the Special Period, devised a series of special operation and control measures, and firmly implemented these measures. As a result of the concerted effort put forth by all members of the Group from top to bottom, we were able to achieve better-than-expected operating results for the year as a whole. Moreover, the Group has grown even healthier, generated higher quality growth, and optimized its ESG work with a broad range of significant moves, including optimization of the Group’s strategic blueprint and business focus, disposal of low-efficiency assets, and implementation of significant strategic agendas.

Refining governance

In the past year, we have continued to refine the Group’s ESG governance framework under the leadership of the Board of Directors and in accordance with the ESG Reporting Guide issued by Hong Kong Stock Exchange. We clarified that the Strategy Committee under the Board of Directors is responsible for ESG affairs, designed the ESG working mechanism, and established and refined the organizational system based on hierarchical reporting principles. The Group is now gradually optimizing the internal policy framework, processes and information system to help the Board of Directors better perform its ESG function and ensure that the Group is providing accurate and timely information disclosure in the ESG report. After COVID-19 broke out, the Group quickly announced the onset of a “special period,” established the Group Decision-making Committee for the Special Period, and implemented an array of risk control measures to bring operational risk under control across the Group. In the following weeks and months, all of the Group’s members worked shoulder-to-shoulder to implement these measures, and as a result the Group was able to effectively control operational risk and demonstrate its capacity for sustainable development.

Strengthening communication

In 2020, we attached great importance to stakeholder communication and opened regular communication channels, and we distributed a total of 7,839 internal and external questionnaires to effectively identify key issues related to sustainable development. We have striven to define objectives for sustainable development management and have put in place measures to address substantive issues that are of common concern to stakeholders. Furthermore, in order to enhance the sustainable development of the economy, the environment and society, we have connected the strengths of all of our employees and stakeholders and implemented effective processes to handle issues that attract the attention

of stakeholders, including operational and risk control compliance; research, development and application of clean and environment-friendly production technologies; employee safety and health; climate change response and greenhouse gas emissions. We have played an active part in various industry associations and social activities and have outlined CIMC Group’s ideas and point of view at various social responsibility summits. As a result of these efforts, CIMC Group has been able to gradually improve its external ESG ratings and receive wider recognition from the capital market and society as a whole.

Leading by example

To tackle climate change, we have reduced the Group’s total greenhouse gas emissions for 3 consecutive years. At the same time, we are deeply aware that we have a long way to go before we can reach peak carbon dioxide emissions and achieve carbon neutrality. For this reason, we have actively echoed the commitment of the Chinese Government to participate in global environmental governance, researched technologies that enable carbon neutrality and peak carbon dioxide emissions, and implemented the Green Development Plan of CIMC Group. CIMC Group is dedicated to reducing its resource consumption, reducing pollution emissions, and propelling green transformation and development. We are working hard to address global climate change and construct an ecological civilization by deploying cutting-edge technologies and offering advanced products, including bamboo flooring; natural gas, hydrogen energy and other clean energy equipment; improved container and vehicle coating processes; and modular construction.

To improve global logistics, we are holding fast to our core value of “pioneering innovation.” We see scientific and technological innovation as the lifeline of our corporate survival and development. For this reason, we have steadily developed and improved the Group’s system for scientific and technological innovation and have carried out research and development for patents as well as industrialization of the results. We see product quality as a cornerstone of our corporate survival, and we always view health and safety as the most important aspect of our product responsibility efforts. We adhere to the principle of “continuously improving without limits,” and we deploy a competitive strategy that is oriented toward global sales and best-in-class products. Under this strategy, we strive to efficiently deliver products and services that are safe and high-quality to a wide array of customers. Furthermore, we believe that in order to succeed in the new era of industrialization, companies need to acquire comprehensive digital intelligence. For this reason, we have deployed strategies to upgrade intelligent manufacturing and advance techniques associated with the new era of industrialization in an all-round manner by combining the Group’s comprehensive roadmap with pilot promotion programs. In this way, we aim to gradually transform and upgrade the Group’s manufacturing operations. In addition, we consider suppliers to be strategic partners of CIMC Group, and we cooperate with them in order to develop and grow our business and achieve mutual benefits. We have teamed up with our suppliers to establish a sound environmental and social risk control environment and implement green supply chain development and management. In this regard, in 2020, CIMC Group was able to use its advanced logistics equipment and services to contribute to the global fight against COVID-19.

To demonstrate its “corporate care” efforts, CIMC Group advocates the human resources concept of “putting people first in pursuit of a common cause” in order to build a community that “shares both returns and risks.” We combine CIMC Group’s overall corporate development vision with the personal goals of employees, and promote personal growth and the pursuit of excellence. In this way, CIMC Group is able to grow together with its employees. With its social responsibility obligations firmly in mind, CIMC Group takes measures to care for society and improve people’s livelihoods, and it seeks to create a sound operating environment for enterprises and support the development of local economic and social philanthropic causes. Following the outbreak of COVID-19 in 2020, the Group immediately sets up the epidemic work steering group and the epidemic response working group, and implemented strong measurements to effectively assure the health and safety of employees. Simultaneously, we have encouraged all of our affiliates to actively participate in the global fight against the pandemic. By working together, we can fully demonstrate CIMC Group’s top-notch capabilities, compassion, and operational risk resilience.

The 2020 Corporate Social Responsibility & Environmental, Social and Governance Report published by CIMC Group details CIMC Group’s efforts and results in the fight against COVID-19, its commitment to maintaining operations, and the tangible actions it has taken in its pursuit of sustainable development during the “special period” following the global outbreak of the pandemic.

Future outlook

Going forward, ESG reporting will be subject to stricter requirements by the State and listed-company regulators; stakeholders will pay closer attention to ESG and sustainable development; and ESG agenda items such as climate change, carbon neutrality and green supply chains will emerge as global focuses. Within this context, as a company with a dual A+H share listing, CIMC Group will work to take its overall ESG reporting to the next level and improve its ESG management capabilities in 2021.

To this end, we will:

• Integrate substantive agendas that attract major attention from stakeholders into CIMC Group’s operations management strategy and work to address the relevant issues.

• Closely monitor type-B indicator data and promote functional management improvements according to the new ESG guidelines released by Hong Kong Stock Exchange.

• Ensure that the Board of Directors leads ESG work, identify gaps between the new ESG guidelines and CIMC Group’s operations, and drive ESG improvements across CIMC Group.

• Adhere to the best-in-class product strategy, pursue scientific and technological innovations, and boost global logistics by offering more high-quality products and services.

• Comprehensively implement the Green Development Plan of CIMC Group, reduce various emissions, and construct and improve green factories and green supply chains.

• Better implement the human resources concept of “putting people first in pursuit of a common cause,” stay firmly committed to employees’ occupational safety and health, and realize the common growth of both the enterprise and employees.

• Actively research climate change and carbon neutrality topics and explore paths that CIMC Group can take to achieve its carbon neutrality objectives.

• Cultivate and expand clean energy business, mainly in the natural gas sector; actively explore and develop other clean energy businesses such as hydrogen energy and offshore wind energy; and devise a diversified clean energy portfolio to develop more application scenarios and integrated solutions.

2021 marks the first year of China’s 14th Five-Year Plan period, and it is also the year in which CIMC Group will begin to implement its 2021-2023 Three-Year Strategic Plan. During this special year, we will consolidate our hard-won achievements, seize opportunities in the new era, adhere to the theme of “operating prudently and pursuing quality growth,” inherit and uphold CIMC Group’s spirit and culture, and enthusiastically work together to “start business a second time.” In short, CIMC Group will work to make a more valuable contribution to sustainable development, with the ultimate goal of making the world a better place.


Chairman & CEO

Mai Boliang

March 2021