MAKING PEOPLE PHYSICALLY AND MENTALLY HEALTHIER
ContentAbout this Report
About Us
Message from theChairman
Sustainable DevelopmentManagement
Appendix: GRI Standards andSSE Sustainability ReportingGuidelines Content Table
Featured Topic of YifengPharmacy's Guard of HealthJourney to a Good Medicine
Corporate Governance14Compliance inOperation
Consolidating the Foundation ofGovernance andAdhering to the Bottom Line ofResponsibility
Strategy of ControllableHigh-quality Medicines
Care for People'sWell-being
Focusing on SelectiveRetailing forPeople's Well-being
Building Our RetailingNetwork
Digital Operation42E?cient LogisticsDistribution
Empowering HealthcareAccessibility andSafeguarding Public Health
Compliant Employment
Talent Development
Democratic Management
Care for Employees53Mental Health54Occupational Health andSafety
Cultivating a Professional TeamandRealising the Value of Talents
Deepening EnvironmentalManagement
Optimising ResourceManagement
Addressing Climate Change62
Practising Green Concepts toCo-create a FriendlyEnvironment
About this ReportYifeng Pharmacy's 2023 Environmental, Social and Governance (ESG) Report (hereinafter referred to as the " Report") is the ?rst ESG report independently published by Yifeng Pharmacy Chain Co.,Ltd. and all the branches and subsidiaries (hereinafter referred Yifneg Pharmacy", "the Company" or "we"). This Report aims to comprehensively present our ESG goals, management strategies,practices and achievements in 2023 to our stakeholders.
This is an annual report published publicly every year. This Report covers the period from 1 January 2023 to 31 December 2023(hereinafter referred to as "2023" or "the reporting period"), the same period as the 2023 Annual Report.Unless otherwise stated, the scope of disclosure in this Report is consistent with that of the 2023 Annual Report, with YifengPharmacy as the subject of disclosure, covering all branches and subsidiaries within the scope of the listed entity. Theenvironmental performance data covers Yifeng Pharmacy's own stores, logistics centers with operational control, employeecanteens, and o?ce that will be in operation throughout 2023. In addition, certain events mentioned in this Report, whetherbefore or after the aforementioned period, are included for the sake of comprehensiveness of context and detail in this Report.
Scope of this Report
This Report complies with the Shanghai Stock Exchange of Issuing the Rules Governing the Listing of Stocks on ShanghaiStock Exchange (February 2023 Revision) and the Guidelines for Environmental Information Disclosure of Listed Companieson the Shanghai Stock Exchange. It is also prepared with reference to the Global Reporting Initiative Sustainability ReportingStandards (hereinafter referred to as "GRI Standards") issued by the Global Sustainability Standards Board (GSSB) . We alsocompared this Report with the Guidelines No. 14 of Shanghai Stock Exchange for Self-Regulation of Listed Companies—Sustainability Report (Trial), please ?nd the Appendix for details.
Basis and Principles of Preparation
The information used in this Report has been obtained from o?cial documents, internal statistics and public information of Yifeng Pharmacy. TheBoard of Directors of Yifeng Pharmacy commits that there are no false records, misleading statements or material omissions and it is responsible forthe authenticity, accuracy and completeness of this report. This Report was approved by the Board of Directors of the Company on April 26, 2024.Information of the Report
This report is prepared in both Simpli?ed Chinese and English andis published in electronic form. In the event of any discrepancybetween the two versions, the Chinese version shall prevail. Theelectronic version of this Report can be accessed and downloadedfrom our o?cial website (https://www.yfdyf.cn) and the website of theShanghai Stock Exchange website (https://www.sse.com.cn).
Accessibility and Contact
If you have any comments or suggestions about this Report, pleaseemail us at ir@yfdyf.com. Your feedback is important in helping us tocontinually improve our sustainable development management andpractice.?
Feedback
About Us
Company Pro?leYifeng Pharmacy Chain Co., Ltd. (a chain pharmacy listed on the mainboard of the Shanghai Stock Exchange in China, stock code: 603939,hereinafter referred to as Yifeng Pharmacy) was founded in June 2001.For 22 years, we have been dedicated to the pharmaceutical retailindustry and are Chinese ?rst large-scale pharmaceutical retailer listedon the Shanghai Stock Exchange. As a leader in China's healthcareindustry, Yifeng Pharmacy has successively developed healthcare-related business models such as pharmaceutical retail and wholesale,production and sales of Chinese herbal medicine, chronic diseasemanagement, Internet hospital, medical project investment, andmedical technology development. While maintaining a stable strategicpartnership with high-quality medicine manufacturers and suppliersin a long term, we have established a complete quality managementsystem and service system to ensure the health and safety ofcustomers. As at the end of the reporting period, our main businesswas concentrated in ten provinces and cities, including Hunan, Hubei,Shanghai, Jiangsu, Jiangxi, Zhejiang, Guangdong, Hebei, Beijing, andTianjin.Adhering to the concept of "a?ordable and professional" and"customer value-oriented" as our core value, we are committed toproviding customers with a wide variety of products and professionalservices at a?ordable prices with remarkable therapeutic e?cacy.In the future, we will continue to focus on pharmaceutical retail andenhance our core competitiveness through brand image, professionalservices, product innovation and business model innovation. In thisway, we aim to build a leading chain pharmacy brand that is trustedby customers and respected by society.
SKUs of medicines over
70,000Employees39,652
Membersmillion
87.1
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
As of December 31 2023
The number of company stores reachedincluding 2,986 franchise stores13,250
Development Milestones
2001
Yifeng Pharmacy ChangdeBinhu Road Store was opened,pioneering the "a?ordablemedicine supermarket model" inthe ?ve provinces of the CentralSouth China
2002
Hunan Yifeng Pharmacy Chain Co.,Ltd. was established, laying thefoundation for cross-regional andcross-provincial operations
2003
The supply chain was reformed tocreate a business model that seekswin-win results for "customers,pharmaceutical factories and YifengPharmacy" as a pioneer in theindustry
2012Yifeng Pharmaceutical LogisticsPark was inaugurated
2013
? Yifeng Pharmacy'se-commerce platform wassuccessfully launched andput into operation? The reconstruction projectof the store managementsystem began
2019? Sales of Yifeng Pharmacy exceeded
RMB 10 billion? The subsidiary, Heng Xiu TangPharmaceutical Co., Ltd., wasestablished
2020
? Following the approval of the licencefor Yifeng Internet Hospital in Hainan, aremote diagnosis and treatment centrewas established? Market value exceeded RMB 50 billion forthe ?rst time
2014Yifeng Pharmacy wasawarded "Champion ofChina's PharmaceuticalRetail Operation"2016A strategic developmenttarget of RMB 100 billion inrevenue was set
2022Over 10,000 Yifeng Pharmacystores opened nationwide
2023" Strategy Innovationand OrganisationalTransformation "campaignwas launched
2018Xinxing Pharmacy, the leading chainpharmacy in Hebei Province, wasacquired for RMB 1.384 billion, makingit the largest merger & acquisition dealof domestic retail pharmacy chains inthe history
2015Yifeng Pharmacy was o?ciallylisted, becoming Chinese ?rstretail chain pharmacy listed onthe mainboard of the ShanghaiStock Exchange
2011? The restructuring into Yifeng Pharmacy ChainCo., Ltd. was completed? The investment in large-scale information
and logistics management system marks the?rst step in technology-driven empowerment? The acquisition of full ownership of ShanghaiKaixin Pharmacy marks the beginning ofmergers and acquisitions for expansion
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Honours and Recognition
AssociationQuali?cation
China MedicalPharmaceutical Material
Association
Executive Vice
President Unit
Retail Branch of the ChinaAssociation of Pharmaceutical
CommerceVice President Unit
Hunan PharmaceuticalProfession Association
Executive VicePresident Unit
Hunan PharmaceuticalDistribution IndustryAssociationExecutive VicePresident Unitc
Honours of the
Year
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Top 500 Service Companiesin China 2003
China Enterprise Confederation/China Entrepreneur Association
Top 100 PrivateCompanies in Wuhan
2023Wuhan Federation ofIndustry and Commerce
Top 100 Most ValuablePharmacies in China 2022-
2023China Pharmacy Development Report
& China Pharmacy Value List Press
Conference 2022-2023
Ranked second in the "2023 Top 100 List of Comprehensive Competitiveness inPharmaceutical Retail", honoured as the "Pharmaceutical Retail Pro?tability Champion2023", and listed in the "2023 Top 10 Pharmaceutical Retail and E-Commerce Enterprises"
China Health Ecology Organization (CEO)
Hurun Most Valuable China
Brands Top 300 in 2023
Hurun ResearchInstitute
Fastest Growing ListedCompanies in China 2023Warton EconomicInstitute
Top 100 Comprehensive Strength of Pharmacy Chain Stores,and Top 100 Direct Selling Chain Pharmacies in 2022 - 2023
MHIS (China Medical and Health IndustrySymbiosis Conference), hosted by Guangzhou
Biaodian Medical Information Co., Ltd.
2023 King's Ark - Employer with Commitment to and
Excellence in Talent Recruitment
BOSS Zhipin
Corporate Culture
Making people physically and mentally healthier
Becoming the preferred pharmacy worthyof trust and entrustmen
Corporate Mission
Corporate VisionPrioritizing our customers, to beresults-oriented, innovative andlean, diligent and pragmatic,responsible and collaborative, caringfor growth
Values
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Message from theChairman
In 2001, Yifeng Pharmacy pioneered the ?rst medicine supermarketin the ?ve provinces of the Central South China, starting in the era ofmedicine supermarkets providing a?ordable medicines for customersin China. Over the past two decades of diligent and determined e?orts,we have remained true to our original aspiration with the mindsetof "bene?ting others as helping ourselves" and are committed tobecoming a company that is valuable to people, society and thecountry. To keep pace with the times, we are actively embracing theconcept of sustainable development, exploring the path for creatingESG values, and comprehensively promoting the implementationof ESG work. We are committed to integrating ESG concepts into allaspects of business management and development, transforming ourcore competitiveness and creating long-term value for our customers.Faced with the challenges and opportunities of practising, YifengPharmacy attaches great importance to corporate governance andcontinuously improves its governance to ensure the standardisationand e?ciency of its operations. Meanwhile, we focus on environmentalprotection, actively respond to environmental issues and steadilypromote our green development. It is essential for companies likeus to make a substantial contribution to the progress of society,leveraging on the foundation of our development to provide solutionsfor the health of our customers. Besides, we are committed tomedicine safety, medicine accessibility and public welfare for thehealth and safety of Chinese."Making people physically and mentally healthier and Becomingthe pharmacy worthy of trust and entrustment". As a companyspecialising in pharmaceutical services, we put our customers' "lifeand health" ?rst. We fully guarantee the quality and safety of ourmedicines by adhering to the standard of "o?ering reliable medicinesfor family members". Having integrated the "strategy of controllablehigh-quality medicine" into our corporate development andestablished a quality system with controllable sources and e?ectivemedicines, we are striving to become a pharmacy worthy of trust andentrustment. As a practitioner of "sustainable public welfare", we arecommitted to "providing professional and warm services" through
various public welfare activities. These activities include "familytea, blood pressure checks and blood sugar checks" in our stores toprovide more comprehensive health care to the public. In addition,health lectures are organised to introduce professional knowledge andliving skills related to health and wellness, with the aim of improvingthe people's knowledge about health. When it comes to disasters,we also respond quickly by providing assistance to meet the a?ectedpeople's basic daily, working hand in hand with them to overcome thedi?culties."New Retail is all about retailing with wholeheartedness and from thesoul". As stores serve as the ?nal end in contacting patients who take
medicines, we need to focus on customers' needs, promote more high-quality and more e?ective medicines, and provide more professionaland re?ned services to them. In this way, we aim to fully satisfy thediverse and personalised health needs of our customers. In terms ofstore services, we are improving the services provided by our healthadvisor and standardising our reception services, family services andchronic disease management services to ensure that customers usemedicines sensibly and safely. For member management, the 11 high-quality member services were created to provide solutions rangingfrom disease treatment to health promotion, and member informationhas been made accessible in stores across the country to better meetcustomers' health needs throughout their lifecycles. For the accessto medicines, we continued to expand our online and o?ine retailnetworks by building comprehensive online retail channels andopening vertical franchises, enabling customers to enjoy a one-stopshopping experience with e?cient delivery and guaranteed quality."Growing and practising green development concept together withYifeng Pharmacy". We value the development of each employeeby providing them with a supportive working environment, acomprehensive reward and remuneration system and ample learningand development opportunities. We also o?er thoughtful bene?tsfor our employees, establish a charitable mutual assistance fundcalled "Yifeng Pharmacy Fund", and encourage employees to activelyparticipate in various community activities to enhance their sense
of belonging and satisfaction towards the Company. In addition,we are gradually implementing green and low-carbon concepts byimproving the utilisation e?ciency of product transportation andpackaging and strengthening the management of environmentalimpacts. Considering the risks and opportunities of climate change,we are implementing photovoltaic power generation projects andpromoting low-carbon transportation to foster the Company's greendevelopment."Contributing to society drives our sustainable success". Ful?lling
corporate social responsibility is a corporate citizen's commitmentand responsibility to society, the cornerstone of long-term corporatedevelopment, and an important path for companies to achievesustainable development. In 2023, we have steadily advanced our ESGe?orts by continuously improving corporate governance, safeguardingpeople's health, participating in public welfare activities, enablingtalent development, promoting green development, and workinghand in hand with stakeholders to jointly create a sustainable future.Looking to the future, we ?rmly believe that our sustainabledevelopment lies in continuously creating values for customersand providing them with health solutions, rather than solely sellingmedicines. We conduct "wholehearted" retailing combined with newretail to enable more people to embark on the path to self-health.By practising sustainability, we strive to make people physically andmentally healthier and to become a pharmacy worthy of trust andentrustment. In doing so, we aim to earn the trust of society and ourcustomers, and ultimately make a signi?cant contribution to socialdevelopment.
Chairman, Yifeng Pharmacy Co., Ltd.
Gaol Yi
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
SustainableDevelopmentManagementYifeng Pharmacy actively practices the concept of sustainabledevelopment, ensuring that the Company takes full account ofenvironmental, social and governance impacts while pursuingeconomic bene?ts. We attach great importance to ESG governance,continue to strengthen the involvement of the Board of Directors andare committed to improving ESG governance. In addition, we activelycommunicate with stakeholders to jointly explore the planning ofsustainable development strategies, promoting the deep integrationof business decisions, sustainable development concepts and theneeds of all parties. In this way, we aim to realise the long-term valueof the business.ESG Governance
In 2023, in order to strengthen the Board of Directors' supervisionand leadership in ESG governance, and to clarify the division ofresponsibilities in related matters, Yifeng Pharmacy integrated ESG-related requirements into the existing functions of the StrategicDevelopment Committee and renamed it as the Strategy andSustainability Committee, so as to lay a solid foundation for theCompany's sustainability actions. The Strategy and SustainabilityCommittee is responsible for deliberating and making decisions onmajor sustainability matters under the authorization of the Board ofDirectors.In 2023, Yifeng Pharmacy engaged professional institutions to provideESG training for the Strategy and Sustainability Committee to promoteESG concepts and knowledge. The training helped the Strategy andSustainability Committee to fully understand the ESG trends and theCompany's current situation, and improved the committee members'awareness of ESG which provided strong support for the e?cientimplementation of our ESG e?orts.
Strategy and SustainabilityCommittee
ESG Management Group
ESG Executive GroupBusiness and Functional Departments,Branches and Subsidiaries
DecisionMaking
Management
Execution
Board of Directors
As the highest body responsible for ESG matters, the Board has overallresponsibility for ESG strategies and reporting , and regularly listening to reportsfrom the Strategy and Sustainability Committee.Composed of members of the Board of Directors, the Strategy and SustainabilityCommittee deliberates on the Company's ESG development strategies and workplans, reviews the Company's ESG management measures, ESG managementobjectives, priorities of ESG-related issue, ESG risks and opportunities, and otherESG-related matters under the authority of the Board of Directors.
This group consists of the heads of the Company's Securities InvestmentDepartment, business and functional departments. It is responsible forcoordinating, implementing and driving ESG-related work and reporting regularlyto the ESG Management Group on ESG work plans, ESG reports, ESG regulatorytrends and market developments.
Comprised of senior management of the Company, this group is responsiblefor implementing the Company's ESG development strategies and workplans, assessing the progress against ESG targets, evaluating ESG risks andopportunities, and reporting regularly on ESG matters to the Strategy andSustainability Committee.
Adhering to the ESG management policies and mechanisms, they are responsiblefor implementing speci?c ESG-related work on ESG issues and regularly report theresults of their work to the ESG Executive Group
ESG Governance Structure
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Stakeholder CommunicationYifeng Pharmacy proactively expands the communication channelswith its stakeholders by establishing a normalised communicationmechanism, gathering and responding to their expectations anddemands. In this way, we can e?ectively establish and maintainharmonious and stable relationships with stakeholders.
Main Communication Channels? Communication with stores? Consumers service hotline? Customers satisfaction survey? Employees communication andfeedback platform? Employees satisfaction survey? Employees meeting? Employees activity? General meeting of shareholders? Announcement? Research roadshow? Company website
? Suppliers conference? Suppliers visit? Industry communication
? Regulatory assessment? Voluntary tax payment? Seminar? Written response to public queries
? Providing job opportunities? Voluntary service? Public welfare activity
Key Stakeholder Groups
Customers
Employees
Shareholdersand investors
Suppliers
Government andregulators
Communities
? Medicines safety and quality? Medicines accessibility? Protection of consumers' rights and
interests? Customers privacy protection? Responsible marketing
? Return on investment? Information disclosure? Corporate governance? ESG management
? Responsible procurement? Integrity and honesty? Win-win cooperation
? Compliant operation? Tax compliance
? Public welfare and charity? Community development and
well-being
Expectations and Demands
? Protection of employees' rights and
interests? Employees development and training? Occupational health and safety? Employees care and bene?ts
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Management of Material Issues
In 2023, Yifeng Pharmacy identi?ed ESG issues related to its stakeholders and business operations, conducted a materiality assessment based on their impacts on both stakeholders and the Company, and mapped an ESGmateriality matrix. These e?orts were aimed at e?ectively responding to the expectations and demands of various stakeholders and continuously improving the Company's ESG management..Materiality Assessment StepsESG Materiality Matrix of Yifeng Pharmacy
Economy and Governance AreaSociety AreaEnvironment Area
Less relevant
RelevantImportant
Impact on Stakeholders
Impact on Yifeng pharmacy
Exhaust emission management
Water resourcesmanagementEnergy management andclimate change
Material use and wastemanagement
FranchiseemanagementProcurementpractices
Innovation &DigitalizationSuppliermanagement
Indirect economic impacts
CompliancemanagementEconomicperformance
CorporategovernanceBusiness ethics and anti-corruptionEmploymentpractices
Communityengagement
Diversity, equity and inclusion
Medicalaccessibilityand inclusion
Training anddevelopmentLabour standards andhuman rights
Customerhealth andsafetyProtection of consumers'rights and interests &Health education
Privacy and datasecurityOccupational health and safety
List of Material Issues of Yifeng PharmacyMaterialityMaterial Issues
Important
Customer health and safetyProtection of consumers' rights andinterests & Health educationPrivacy and data securityLabour standards and human rightsTraining and developmentOccupational health and safetyMedical accessibility and inclusionDiversity, equity and inclusionBusiness ethics and anti-corruptionCorporate governanceCompliance managementMaterial use and wastemanagement
Relevant
Community engagementEmployment practicesSupplier managementInnovation & DigitalizationEnergy management and climatechangeWater resources managementEconomic performanceProcurement practicesFranchisee management
Less relevant
Indirect economic impactsExhaust emission management
Step 1 - Identi?cationWe identify 23 material issues within the 3 areas,namely the Environment, Society and Economy andGovernance areas according to the GRI standards,peer benchmarking, ESG rating focus, nationalpolicies and stakeholders communications results.
Step 2 - AssessmentWe send material issues questionnaires tostakeholders to orderly prioritise the issues andclarify the ranking of material issues.
Step 3 - Approval and ReviewWe map the materiality matrix based on thequestionnaires results and peer benchmarking,which is approved by the Strategy and SustainabilityCommittee.
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Snapshot about Yifeng Pharmacy in 2023
Consolidating the Foundation of Governance and Adheringto the Bottom Line of Responsibility
Held a total of 4 general meetings of shareholders, 13meetings of the Board of Directors and 10 meetings of theSupervisory Board.
Our information disclosure work has received an A ratingfrom the Shanghai Stock Exchange for seven consecutive
years
Participated in over 200 investor conference calls, over 90roadshow events, over 20 brokerage strategy meetings, andheld 3 performance brie?ngs.
In 2023
As of 31 December 2023
In 2023As of 31 December 2023
Focusing on Selective Retailing for People's Well-being
launched "88" membership programme: 8 additional rights andbene?ts and 8 professional member servicesServed over 80 million chronic disease person-time
Average customer service response time was 5 seconds, with the problem resolution rate of 98%
Donated and provided material contribution over RMB
67.2 million, facilitated over 800,000 donations，and
successfully held over 1,500 charity events.Conducted 1,555 on-site supplier visits, 1,488 batches of keyvarieties for quality comparison and inspection, 1,375 varieties ofmedicines were reviewed om e?cacy and quality perception
Delivered more than 10,000 health lectures
Empowering Healthcare Accessibility and Safeguarding Public Health
A total of 10,264 self-operated stores, including 26 ?agship stores, 95 regional centre stores, 1,023medium-sized community stores and 9,120 small-sized community stores.
305 DTP speci?c drug stores, 246 designated stores for "dual-channel" medical insurance, more than4,200 outpatient co-ordinated health insurance stores, and 675 hospital a?liated stores.
Warehouse shipments of 800,000 lines of orders per day with near 100% shipment accuracy
7 modern provincial logistics centres, 6 urban delivery centres, 16 warehouses with full
on-line management
Cultivating a Professional Team and Realising the Value of TalentsPractising Green Concepts to Co-create a Friendly Environment
Practising Green Concepts to Co-create a Friendly Environment A total of 39,652 employees, 12,816employment were provided by franchised stores, female senior managers account for 27 %
The smart lighting system applied in several stores, with 34% power saving per storeSeveral new stores were decorated with environmentally friendly materialsThe proportion of new energy vehicle capacity in core urban areas reached 100%, and that of otherurban areas was 50%, and the use of new energy vehicles in third-party logistics and distributionreached more than 60%Cumulative photovoltaic power generation reached 780 thousand kWhSavings of 1.2 million kilowatt-hours of electricity were achieved through the use of theauto-sensing control system
The average o?ine training hours reaching 70 hours per employeeConducted cultural activities with a total of over 53,000 participants
"Yi" Fund has provided supports to over 300 employees or their family members, with totalassistance exceeding RMB 4 million
In 2023In 2023
As of 31 December 2023
As of 31 December 2023
| 牢筑治理根基 坚守责任底线 | 锚定精品零售 增进民生福祉 | 聚力医药可及 守护人民健康 | 打造专业队伍 成就人才价值 | 践行绿色理念 共创友好环境 |
To ensure that customers have access to reliable and cost-e?ectivemedicines, Yifeng Pharmacy strictly controls quality at source andconducts multiple medicine screenings through procurementselection meetings, e?cacy evaluation meetings and otherapproaches, combined with e?cacy assessments and counsellorevaluations. We also recognise that solely depending on screeningsis not su?cient for eliminating all health risks. In order to minimizeall the hidden dangers of medicine procurement, we also conduct in-depth inspections at the production line of our suppliers, and conductsampling and delivery tests of medicines every year, so that we cando again what others have done with higher standards to ensure thequality and safety of medicines.
Strict control of medicine procurement is only the beginning of YifengPharmacy's professional pharmaceutical services. To further safeguardthe health of all people in China, a business strategy of "wholeheartedretail + new retail" has been proposed to make customers feel ourcommitment with more professional and meticulous pharmaceuticalservices. Regular o?ine community free medical consultation, healthlectures and other activities are conducted to raise the awarenessof managing health among the Chinese. Meanwhile, new retail andinternet healthcare systems have been actively promoted onlineto provide more e?cient and convenient diagnosis and treatmentservices for patients. Leveraging on digital technology, we striveto realize the organic combination of online and o?ine services,integrate the real and the virtual, and connect services to create an all-round retail network that protects people's health.
In addition to ensuring the quality of medicines, delivering drugs tocustomers with quality and speed is also our focus. To this end, 7provincial logistics centres with a total of 16 specialised warehouseshave been established in the Central South, East and North China.Continuous e?orts have been made to strengthen digital andintelligent management of rapid medicine procurement, intelligentmedicine replenishment, coordinated delivery, intelligent returnsand other processes. We do our best to ensure that customers get themedicines they need in the shortest possible time, with the aim of"medicines waiting to be picked up"rather than 'people waiting formedicines'."Taking the Responsibility for the Achieving Success" is our eternalquest. Having put customers at the forefront of our businessconsiderations, we will continuously improve our medicine andservice support systems to provide customers with the best possibleoptions and provide more reassuring medicines and services. In thepursuit of health, we hope to be as helpful as quality medicines thatwholeheartedly bene?ts everyone and solves the health problems ofnumerous families. Meanwhile, regardless of how the environment is,we are always there to provide reliable medical support.
By the end of 2023
1,555
on-site visits tosuppliers' production lines
Featured Topic ofYifeng Pharmacy'sGuard of HealthJourney to a GoodMedicine
Adhere to the principle of strict sourceselection, act as a quality "gatekeeper"
Support People's "Dream of Health" withFull Service
Fast, Safe Medicine Delivery for HealthProtection - the "Bridge" to MedicineDelivery
We are a fortress of health, not just a pharmacy.Each dose of quality medicine we select is intendedto be a solid guarantee of people's health.Since its establishment, Yifeng Pharmacy has alwaysadhered to the mission of "Making people physicallyand mentally healthier". We are fully aware that wehave an inescapable responsibility for the healthand safety of our customers in relation to the useof medicines. Therefore, we have established acomprehensive medicine quality assurance system,a "guardian network" for people's health, to providewarm medical care to every corner and enable morepeople to have access to safe and reliable medicinesas well as professional and caring services.
122023 Environmental, Social and Governance Report
牢筑治理根基 坚守责任底线锚定精品零售 增进民生福祉聚力医药可及 守护人民健康打造专业队伍 成就人才价值践行绿色理念 共创友好环境
Consolidating the Foundationof Governance and Adheringto the Bottom Line ofResponsibility
"
"
Yifeng Pharmacy has ?rmly established thefoundation for its sustainable development throughtwo pillars, namely corporate governance andcompliance in operation. Driven by sound corporategovernance as an internal motivation to achievesustainable development, we continuously createvalue for shareholders. We also perform strictcompliance with laws and regulations, strengtheninternal management, and adhere to the bottomline of operations in a bid to provide strongsupport for the Company to achieve its sustainabledevelopment goals.
CorporateGovernanceYifeng Pharmacy strictly complies with the Company Law of thePeople's Republic of China, the Securities Law of the People's Republicof China, the Code of Corporate Governance for Listed Companies
andother relevant laws and regulations issued by the China SecuritiesRegulatory Commission and the Shanghai Stock Exchange. Basedon these, we have formulated the basic policies related to corporategovernance, including the Articles of Association of Yifeng Pharmacy,the Rules of Procedure for the General Meeting of Shareholders ofYifeng Pharmacy, the Rules of Procedure for the Board of Directors ofYifeng Pharmacy, the Rules of Procedure for the Board of Supervisorsof Yifeng Pharmacy and the Working Rules for IndependentDirectors of Yifeng Pharmacy. We also improve our corporategovernance structure to ensure the standardisation and e?ciencyof our operations. In the meantime, we continuously regulate ourdisclosure of information to provide complete, accurate and updatedinformation. Besides, we actively communicate with investors to buildsolid and trusted relationships. We are committed to improving ourcorporate governance standards, safeguarding investors' rights andinterests and promoting the long-term stable development of YifengPharmacy.
Governance StructureThe governance structure of Yifeng Pharmacy consists of the General Meeting of Shareholders, the Board of Directors, the Board of Supervisorsand the Management. They strictly exercise their rights and performs duties in accordance with the principles of clear responsibilities, allocationof functions, mutual coordination, e?ective checks and balances, scienti?c decision-making and standardised operations. This ensures that thelegitimate rights and interests of the Company and its stakeholders are also safeguarded.The General Meeting of Shareholders, as the supreme authority of the Company, strictly comply with the relevant regulations, exercises its powersin accordance with the laws and ensures the e?ective performance of its functions. The Board of Directors undertakes the ultimate responsibility forthe operation and management of the Company and reports to the General Meeting on its work. The Board of Supervisors has the important task ofsafeguarding the interests of all shareholders and ful?ls its various supervisory duties and obligations conscientiously, giving priority to the interestsof all shareholders. Adhering to the principle of integrity. The Management performs its duties with care and diligence and manages the Company'soperation in accordance with the decisions of the Board.
Board of Supervisors Meetings
Board of Directors Meetings
general Meetings of shareholders
As of 2023 we organised
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
The Company's Board of Directors has a Nomination Committee, aRemuneration and Appraisal Committee, a Strategy and SustainabilityCommittee and an Audit Committee. The Board performs its dutiesprudently, actively participates in the Company's major decision-makings and expresses signi?cant opinions on the Company's vitalmatters to ensure that the overall interests of the Company andthe interests of minority shareholders are e?ectively safeguarded.Each of the Board's committees ful?ls its responsibilities strictly inaccordance with its detailed rules of works, operates in a lawful andcompliant manner and plays a crucial role in enabling the Board tomake scienti?c decisions. In 2023, the Board of Directors deliberatedon and approved a total of 71 proposals and heard or reviewed 15reports. The four committees of the Board of Directors held a total of9 meetings, reviewed and approved 23 proposals, heard or reviewed14 reports.
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Senior Management
Structure of Organizations in Yifeng Pharmacy
Administration DepartmentSecurities InvestmentDepartmentStrategicImplementation O?ceFinance CenterHumanResources CenterProduct CenterDigitalization CenterExpansion CenterOperation CenterEnterprise UniversitySupply Chain and Non-Pharmacy DepartmentLogistics ManagementDepartmentEngineering DepartmentNew Retail DepartmentQuality Control DepartmentOrganizational Manag-ement DepartmentNon Operating PurchasingDepartment DepartmentExternal and LegalA?airs DepartmentAudit and InspectionDepartment
General Meeting of Shareholders
The Board of Supervisors
Audit Committee
Strategy and SustainabilityCommitteeReuneration and AppraisalCommittee
Nomination CommitteeThe Board ofDirectors
Composition of the Board of Directors
As at the reporting date, the Company's Board of Directors consistedof 9 directors, including 3 independent directors and 2 femaledirectors, in which there were 3 independent directors come fromdi?erent ?elds such as management, law and accounting.
The Company's Boardof Directors consisted ofdirectors
Female directors
Independentdirectors
Appointment of the Board of DirectorsThe directors of the Company are elected by the General Meeting of Shareholders and the Nomination Committee reviews the quali?cations ofthe nominated candidates. When appointing members of the Board of Directors, the Company gives full considerations to factors such as industryexperience, educational background, professional skills and gender to ensure that the Board meets the requirements of professionalism anddiversity.
Independence of the Board of Directors
The Company has issued the Working Rules for Independent Directors of Yifeng Pharmacy, which emphasises the powers and responsibilities ofindependent directors, clari?es the restrictions on independent directors in terms of shareholding, appointment and major business transactions,and ensures that independent directors can perform their duties in an objective manner.Remuneration for Directors, Supervisors and Senior ManagementThe Remuneration and Appraisal Committee of the Board of Directors of the Company is the governing body that assesses and determinesthe remuneration of directors, supervisors, and senior management. The remuneration plan for directors and supervisors formulated by theRemuneration and Appraisal Committee shall be approved by the Board of Directors and then submitted to the General Meeting of Shareholders forapproval. The remuneration plan for senior management shall be directly submitted to the Board of Directors for approval.
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Sustainable Development ManagementYifeng Pharmacy has formulated the Investor Relations Management Policy of Yifeng Pharmacy in accordance with Work Guidelines for the InvestorRelations Management of Listed Companies and other relevant regulations. Based on the principles of openness and fairness, the Companyproactively manages investor relations to safeguard the legitimate rights and interests of investors, including the right to know . This ensures thatthe interests of both large and minority investors, as well as minority shareholders, are not compromised.We maintain good communication with institutional investors, minority shareholders and potential investors through various online and o?ineforms such as on-site receptions, performance brie?ngs, hotline, email, WeChat and the Shanghai Stock Exchange's (SEE) e-interaction platform. Weare also striving to improve our communication and provide better investor relations services. In addition, open and transparent communicationchannels such as the investor service hotline (0731-89953989), the investor relations email (ir@yfdyf.com) and the Company's website (www.yfdyf.cn) have been established to facilitate inquiries from small and medium-sized investors.
investor conference callsover
roadshow events
more than
brokerage strategy meetings
performance brie?ngs
"Embracing the Registration System and Sharing High-Quality Outcomes" ?"I am the Shareholder" Event forConnecting with Yifeng Pharmacy
In order to let investors better understand the investmentvalue of the listed companies in Shanghai Stock Exchange andestablish their awareness of the correct execution, on July 11,2023, under the guidance of the Shanghai Stock Exchange, wecollaborated with China Reform Securities to hold the eventcalled "Embracing the Registration System and Sharing High-Quality Outcomes" about listed companies, leading 13 minorityinvestors to visit Yifeng Pharmacy.
Communications and Exchanges with Investors
On December 6, 2023, we launched the survey of "Entering alisted company - Yifeng Pharmacy". Company representativesand investors communicated and exchanged their ideasabout the Company's business development, scienti?c andtechnological innovation, industry competition, strategiclayout and so on and invited them to visit Yifeng Pharmacy'sChaoyang store, which deepened their understanding of thestore's operation model. With the help of this exchange, YifengPharmacy fully demonstrated its strength to investors ande?ectively enhanced investors' understanding and trust towardsthe Company.
"Entering a Listed Company – Yifeng Pharmacy" Activityfor the Survey on Investors
In 2023, we participated in or organised
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Information DisclosureYifeng Pharmacy carries out information disclosure management in strict accordancewith the Rules Governing the Listing of Stocks on Shanghai Stock Exchange, theGuidelines of the Shanghai Stock Exchange on the Application of the Self-RegulationRules for the Listed Companies and other relevant regulations. We have formulateda series of internal information disclosure management policies, such as theYifeng Pharmacy Information Disclosure A?airs Management Policy and the YifengPharmacy Registration and Management Policy for Informants of Insider Information,standardized the information disclosure standards and reporting process, and activelyful?lled the information disclosure obligations to present the Company's businessphilosophy and achievements to investors on the principles of truthfulness, accuracy,completeness, timeliness and fairness.In addition, the Securities Investment Department, as the Company's informationdisclosure management department, continuously improves the standardisedoperation of the Company's information disclosure. By improving the transparencyand quality of information disclosure, we e?ectively protect investors' right to knowand establish a sound corporate image. Since our listing, our works in the informationdisclosure has received an A rating from the Shanghai Stock Exchange for sevenconsecutive years, demonstrating the regulators' high recognition of our Company'sdisclosure and standardised operation.
Anti-Unfair CompetitionYifeng Pharmacy strictly complies with laws and regulations such as the Anti-monopoly Law of the People's Republic of China andthe Anti-Unfair Competition Law of the People's Republic of China. Our business activities are conducted based on the principlesof voluntariness, equality, fairness and integrity. By doing so, we strictly prohibit engaging in or assisting others to engage in unfaircompetitive practices and ensure that our business operations are always conducted in accordance with laws and regulations.In addition, we have entered into services cooperation agreements with third party agencies to deal with trademark infringements,restrictive competitions and other unfair competitive practices. Their expertise helps us to e?ectively combat infringements andprotect our legitimate rights and interests.
Compliance in Operation
With a philosophy of compliance in operation, Yifeng Pharmacy strictly adheres to relevant laws and regulations governing theoperations and the industry, including the Company Law of the People's Republic of China, the Drug Administration Law of thePeople's Republic of China， and the Regulations for Implementation of the Drug Administration Law of the People's Republic ofChina. In addition, the Company has formulated internal documents such as the Measures for the Identi?cation of AdministrativePenalty Responsibility of Yifeng Pharmacy to de?ne the compliance responsibilities of employees at all levels. To ensure legality andstandardisation of operations, the Company has strengthened the internal control and compliance, improved risk management andstrictly adhered to business ethics, thus laying a solid foundation for long-term development.We have established a compliance management structure to ensure compliance responsibilities are met and to manage and serveas a guidance for our operations. At an organisational level, the Chairman of the Board of Directors plays a key leadership role inoverseeing and managing the Company's compliance risks in order to ensure its compliance with all applicable laws, regulationsand internal policies. At a business level, the Securities Investment Department is responsible for compliance matters relating to thestandard management of listed companies. This includes information disclosure, equity a?airs management and investor relations.The External and Legal A?airs Department provides legal advice on the compliance in business operations, reviews and monitorsthe signing and execution of contracts and prevents legal risks. The Quality Control Department oversees the entire product qualitymanagement process, ensuring that the Company's products meet relevant quality standards and regulatory requirements. TheOperation Center is responsible for establishing operational standards and procedures for our stores and ensuring their compliancein operation.
We have published
interim reportsand
periodical reports.Our information disclosure work has received an
A
rating from the Shanghai Stock Exchange for
sevenconsecutive years
2023
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Integrity and Anti-CorruptionYifeng Pharmacy continuously strengthens the business ethics system, enforces strict codes of business conduct and ethics, organises keyanti-corruption and whistleblowing measures in a systematic manner, and develops key system for anti-corruption and the protection ofwhistleblowers. These e?orts are aimed at raising employees' awareness of business ethics, creating a corporate image of integrity, and settingan example for sustainable industry development.
Integrity and Anti-CorruptionTo standardise the codes of conduct on employees and suppliers'business ethics, a series of regulations and codes of conduct havebeen established, including the Yifeng Pharmacy Employees'Integrity and Self-Discipline Management Regulations, the YifengPharmacy Code of Conduct for the Ten "Red Line" Behavioursand the Whistleblower Reward Management Measures ofYifeng Pharmacy. These documents clearly outline the speci?crequirements for integrity and self-discipline, as well as thepunitive measures for violations. With a focus on continuousregulation improvement and updating, we revise and re?nerelevant regulations in a timely manner based on the Company'sdevelopment and changes in the external environment, to ensurethey remain up-to-date and relevant.A line of supervision for integrity has been established fromthe Board of Directors, the Audit and Inspection Departmentand the branches and subsidiaries. The Chairman of the Boardis the person with the highest responsibility for maintainingthe Company's business ethics and anti-corruption e?orts.Furthermore, an Integrity and Self-Discipline SupervisionCommittee, chaired by the Chairman, has been established. TheCommittee manages the integrity and self-discipline practicesof employees with the assistance of the Audit and InspectionDepartment, which acts as a supervisor of the Integrity and Self-Discipline Supervision Committee.
Yifeng Pharmacy Integrity and Self-discipline Supervision Committee
Team Leader: Chairman
Deputy Team Leader：Head of Audit and
Inspection Department
Members: General Assistant of Audit and Inspection,
and Head of Audit and Inspection Department ofYifeng Pharmacy Branches (Subsidiaries)
In 2023, anti-monopoly and anti-unfair competition trainingwas conducted for the Pricing Group of our Operational Line,focusing on the new provisions added in the relevant laws andregulations on anti-monopoly and anti-unfair competition. Thetraining covered the identi?cation and monitoring of marketmonopoly behaviours, and compliance requirements related toanti-monopoly and anti-unfair competition. Case studies andpractical exercises were used to help employees to gain a deeperunderstanding of how to comply with anti-monopoly and anti-unfair competition laws, and how to prevent and respond torelated risks in their daily work. In this way, the training aimed toenhance employees' compliance awareness and comprehensivecapabilities.
Securing the Compliant Operations andBuilding a Fair Market
Anti-Monopoly and Anti-Unfair Competition Training
Conducted by Yifeng Pharmacy
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Audit and InspectionWe focus on establishing and improving risk management and internalcontrol systems. Regular internal audits and special reviews arecarried out to scrutinise the Company's ?nancial reports, operationaldata and business processes in order to identify potential risks andweaknesses in a timely manner. For the identi?ed internal controlde?ciencies, proactive remediations and improvements are takento ensure that the internal control system always functions well. Inaddition, business ethics standards, anti-corruption policies andother regulations have been incorporated into relevant special auditsor ongoing audits to ensure that the Company's business conduct isconsistent with business ethics and legal compliance requirements.Based on the annual audit work plan, we initiate monthly auditsfocusing on di?erent business areas and key responsibilities, whilemaking daily business operations and anti-fraud e?orts a regular partof our monthly audits with a 100% coverage of audits on the stores. In2023, monthly plans covering systems, processes and daily operationswere developed, and audits for business conduct violations and fraudpractices were conducted in all areas, including human resources,procurement, merchandise, and quality control.Anti-corruption and Integrity Promotion
We take a ?rm stance opposing against all forms of corruption andunethical business conduct. To continuously improve our anti-corruption and integrity system, we have formulated the YifengPharmacy Anti-Commercial Bribery Management Policy andCommitment Letter, which explicitly prohibits commercial bribery.Similarly, all our external partners, such as clients, service providersand suppliers, who do business with us are required to sign theIntegrity Agreement to ensure integrity practices in business activitiesbetween both parties. In 2023, 100% of suppliers signed the IntegrityAgreement.We have a zero-tolerance approach to incidents of corruption. If it
is con?rmed that a corruption incident has occurred, an immediateinvestigation will be conducted, with evidence collected andinterviews conducted, and the employees involved will be suspendedfrom their positions. Serious cases are referred to the judicialauthorities. We emphasize anti-corruption education, and throughcontinuous anti-corruption awareness and education, we informour employees of the Company's anti-corruption regulations andinitiatives. By the end of 2023, the Company's anti-corruption traininghad covered 39,652 employees, with a 100% coverage rate.
Whistleblowing Management
We have formulated the Whistleblower Reward ManagementMeasures of Yifeng Pharmacy to standardise the Company's handlingprocedures, standards, and management requirements for complaintsand reportings. In addition, smooth complaint and reporting channelshave been established to encourage the Company's employees andstakeholders to actively report any behaviour that is detrimental tothe Company's interests. Through these e?orts, we aim to create a fair,transparent and clean working environment.
Whistleblowing Channels in Yifeng PharmacyHotline: 0731-89953931Email: sjb@yfdyf.comPlatform: WeCom - EmployeeExpress – Reporting on Violations ofDisciplines and RulesIn addition, a con?dentiality mechanism for whistleblowers is setout in the Whistleblower Reward Management Measures of YifengPharmacy. The personal information of whistleblowers and allmaterials provided by them will be kept strictly con?dential, and anyforms of retaliation against whistleblowers are strictly prohibited.
In 2023, the anti-corruption training entitled "Red Lines asProtective Lines" was conducted to raise new employees'awareness of integrity and self-discipline, and to ensure thatthey maintain high ethical standards in their work.The training focused on three themes, which are the Integrity andSelf-Discipline with the "Ten Red Lines", the Sunshine IntegrityAlliance - Blacklist and the Whistleblower Reward ManagementMeasures. Case studies, Q&A sessions and other methods wereused to help employees gain a deep understanding of theimportance of integrity and self-discipline, and to raise theirawareness of the "Ten Red Lines". In addition, the SunshineIntegrity Alliance's blacklist regulation was explained, with anemphasis on the critical role of integrity and compliance in thebusiness practice. Meanwhile, a comprehensive introductionto the Whistleblower Reward Management Measures was alsoprovided to encourage employees to actively participate inmonitoring and to work together to create a fair and transparentworking environment.
On-boarding training - "Red Lines" asProtective Lines
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Information Securityand Privacy
Yifeng Pharmacy recognises the criticalimportance of information security andcustomers' privacy protection. We strictlyadhere to laws and regulations such asthe Cybersecurity Law of the People'sRepublic of China, the Data Security Lawof the People's Republic of China, and thePersonal Information Protection Law of thePeople's Republic of China. Furthermore, wehave formulated internal policies includingthe Measures for Yifeng Pharmacy DataSecurity Management, the Yifeng PharmacyPersonal Information Protection Policy, theYifeng Pharmacy Service Agreement, theGuidelines for the Safe Usage of Data ofYifeng Pharmacy Members, and the Measuresfor Yifeng Pharmacy Project InformationSecurity Management. These policies outlinerequirements for classifying and managingof our customers' data, as well as ensuringfull lifecycle management, to protect of ourcustomers' privacy.We advance external information securitysystem certi?cation. Our internet hospitalreceived the National Level 3 Equal ProtectionCerti?cation in 2023. We are currentlyplanning to engage an external audit ?rmto conduct independent audit on theinformation security of our internet hospital.Based on the audit recommendations, we willmake targeted improvements to enhance thecon?dentiality and usability of hardware andsoftware systems comprehensively.
◎Information Security Management Structurec
To strengthen the management and implementation of internal policies, we have established an information security management structure to ensure professionalmanagement decisions and e?ective execution. The Chairman of Yifeng Pharmacy is the person with the highest responsibility for the management of Company's informationsecurity. A three-tier management structure consisting of the Information Security Committee, the Information Security Executive O?ce, and the Information Security Manager.Additionally, we have appointed information security managers in our Digitalisation Centre and information security audit managers in our Audit and Inspection Department.They conduct internal reviews of information security every 6 months, promptly report any issues identi?ed, and follow up on recti?cation measures to form a closed-loopmanagement system for information security. In the future, we plan to engage a third-party security service company to conduct penetration testing on our internal systems tocontinuously enhance our security management and technical capabilities.
Three-tier Management Structure
Information SecurityCommittee
Information SecurityExecutive O?ce
InformationSecurityTrainingandPublicity
Hardware ManagementSoftware ManagementFirewallBastionhost
VPN
Information Security
Information Security
Security Manager
InformationSecurityEmergencyResponseMechanisms
Virus Protectin SystemTerminal ManagementSystem
Log Audit SystemNetwork Audit SystemData Encryption System
Computer RoomsEnvironmentSecurity Inspections
Equipments Operation andMaintenanee
Usage Norms
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
The InformationSecurity Manager
? Formulating the Company's overall information security strategy and policy? Drafting data management policies, security classi?cation standards and requirements at the Group level? Supervising the data security status and management e?ectiveness across the Group, and coordinating cross-departmental data security management? Driving the establishment of data security management team and fostering a culture of strong awareness ofdata security in the Group? Assisting the Information Security Committee in implementing information security strategy, includingproposing annual plans and implementation schemes? Carrying out regular inspection, assessment, and evaluation on data security management situation across the
company, and providing improvement requirements and recommendations for rewards and punishment? Coordinating emergency response and treatment of major data security risks and incidents across the Company? Determining the strategy and focus of data security management work according to the respectivebusiness line? Reviewing and con?rming the compliance of data security policies and process standards? Leading the implementation of important measures for data security management, and inspecting andsupervising the data security status and management e?ectiveness of the line
The Information Security Management Structure
The InformationSecurity ExecutiveO?ce
The Information
Security
Committee
◎Software Management
We focus on building a multi-layered security defence network,including the construction of advanced cybersecurity systems suchas ?rewall, VPN, bastionhost, log audit system, virus protectionsystem, network audit system, terminal management system and dataencryption system. These infrastructures protect internal informationand data from unauthorised access, data leakage, and cyberattacks.Our core management measures are as follows.
Utilising network management software, intrusiondetection system, ?rewall log audit system, virus alertsystem and other technological means to promptlydetect various security incidents on the network andassess the potential severity of impact.
Strengthening backups of critical data and systemsto ensure data security and reliability. Regularlymaintaining and updating information systeminfrastructure to ensure its stable operation.
Conducting regular security vulnerability scans andrisk assessments on computer systems to promptlyaddress breaches and mitigate risks.
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
◎Hardware Management
The foundation of information security lies in hardware management. To enhance the capability ofsafeguarding network and information security, we have formulated policies such as the Yifeng PharmacyInformation Equipment and Systems Management Standardization and the Yifeng Pharmacy ComputerRoom Security Management Policy. We take preventive measures to ensure the security of the Company'snetwork, computers, related supporting equipment and facilities, and system operating environment.
To ensure system stability and reliability, we have established clear regulations for thedaily environmental maintenance, ventilation and lighting, dust prevention, electricalenvironment, temperature, and humidity in the computer rooms for normal operation ofthe computers.
Environmental Management
To eliminate security risks to the largest extent, we strictly carry out electrical safetymanagement and equipment safety management of the computer rooms, includingmonthly inspections of various warning systems, semi-annual inspections of power supplyequipment and so on. This ensures that potential security issues are promptly discoveredand e?ectively solved.
Security Management
Computer Room Management
We require sta? to conduct regular inspections and maintenance of hardware equipmentin the computer rooms, including dust removal and heat dissipation. Management sta? arerequired to record the operation status and faults of all system equipment in the computerrooms.
Hardware Management
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
◎Information Security Emergency Mechanism
In the meantime, we continuously improve passive emergency management e?orts to promptly prevent,control, and minimise the harm and impact of information security incidents, including information leakage.Yifeng Pharmacy has clearly de?ned emergency response processes, including alerting, assessment,handling, and answer in the Emergency Management Policy for Computer System of Yifeng Pharmacyand the Emergency Plan for Computer and Network Information Security of Yifeng Pharmacy.Based onspeci?c circumstances of emergency plans and information security incidents (such as internal and externalnetwork failures, equipment failures, cyberattacks, virus attacks, database failures, and natural disasters),we formulate and implement corresponding response measures to secure rapid recovery of our informationsystem. Additionally, the Company regularly organises computer system emergency drills to simulate realcase scenarios and test the e?ectiveness and feasibility of emergency plans.
◎Information Security TrainingTo standardise employees' daily practices on information security, we have clearly de?ned responsibilities forinformation security, o?ce areas and terminal, information security behaviours in external communicationand so on in the Yifeng Pharmacy Employee Information Security Code of Conduct. Information securitytraining sessions are conducted regularly for all employees to enhance employees' awareness and responsecapabilities of information security and emergency management. This also ensures that all employees havea thorough understanding of relevant laws and regulations, as well as our internal policies.
Meanwhile, we have developed the Guidelines for the Usage Security of Medical Insurance NetworkEquipment in Yifeng Pharmacy focusing on the Company's planning, implementation, review, andimprovement requirements for controlling information security in stores. This further standardises theframework for stores information security management and the requirements for the use of medicalinsurance designated computers.
Guidelines for the Use of Medical Insurance Designated Computers at Stores? Equipment debugging is restricted to internal engineers, with no access permitted for others.? Medical insurance designated computers are restricted to processing medical insurancetransactions.? The principle of usage is "Whoever in use is responsible". Each computer is assigned to adesignated user, who serves as the primary responsible person.? External devices should be turned o? if not in use, ensuring they are powered o? whenunattended and at the end of the working day.? Operators are strictly prohibited from using transmission media such as disks, CDs, and
USB drives. Operators are also restricted from unauthorised dismantling of equipmentand adding, removing, or testing new accessories.? Users must close applications in use or activate the lockscreen before leaving the device,
especially when using business software.
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Customer Privacy ProtectionAt Yifeng Pharmacy, we fully respect and protect customer privacy. Customers have the right of access, recti?cation and deletion of their personal information. Additionally, personal information provided and authorised bycustomers is in strict con?dentiality to secure its use for agreed-upon purposes only. To ful?l this commitment, we have formulated clear requirements covering the entire data lifecycle, including collection, use, transmission,storage, and destruction of data:
During user registration and similar occasions, we clearly state the reasons and purposesfor collecting personal information and obtain the user's consent. Throughout theprocess, we adhere to the principle of "minimising the right to access" and focus ontransparency and accountability to make sure that users fully understand the backgroundof information usage. Additionally, we strictly limit and monitor bulk data entry forappropriately regulated data collection.
Strict Control of Information Collection
Based on the business attributes of the data and its speci?c classi?cation principles, datatypes and security protection levels are divided from high to low level, and data securityis strictly controlled based on the requirement of "Whoever in operation is responsible".In systems where information and data of customer privacy are needed to be publicised,anonymisation techniques are employed to hide sensitive information, reducing thesensitivity and con?dentiality level of the data. Additionally, all access and operation logsare recorded for subsequent security monitoring and audit purposes.
Data Usage Standards
Before data transmission, we rigorously verify the data scope and the identity of therecipient. We utilise advanced encryption techniques to secure data transfer of customerinformation. Apart from providing services to our customers, we do not rent, sell, orprovide users' personal information with any third parties.
Encrypted Transmission
To prevent unauthorised access and data leakage, we encrypt the storage of customers'personal information, minimise data storage to the greatest extent possible, andimplement strict access control permissions that strictly prohibit unauthorised access.
Encryption Storage and Access Control for Privacy Information
For devices storing information and data to be repaired or disposed of, we require supervision of the repair and disposal processes. For discarded devices, we take methods like diskdegaussing or physical destruction for data destruction. For reusable devices, we use data overwriting methods to destroy data within a speci?ed time frame, to prevent any form of dataleakage. Additionally, aside from legal requirements, we do not collect personal data from third parties.
Data Destruction
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Furthermore, all employees and suppliers are required to sign the Non-disclosureAgreement and undergo privacy protection training to strengthen customer privacyprotection and prevent any unauthorised disclosure of customer information.During the reporting period, Yifeng Pharmacy mainly engaged in information securitymanagement and sensitive system data masking projects to keep our securityinfrastructure at the industry's forefront.
In 2023, we did not receive any complaints related to breaches of customer privacy or lossof customer data.
To strengthen the protection of corporate data assets and e?ectively controlpotential project risks, we initiated an information security managementproject during the reporting period. This includes supplier information securitycapability assessments, information security training and con?dentialityagreements for project teams, intensive project management and reviews, aswell as network isolation and control of mobile storage devices. These e?ortssigni?cantly improved the security and operability of project informationmanagement.
Information security management project
During the reporting period, we launched the sensitive system data maskingproject to safeguard customers' personal information and prevent dataleakages to the greatest extent possible. This project involved de?ning theaccurate scopes of sensitive data, establishing clear protection requirementsfor data of di?erent levels of sensitivity, and implementing speci?c technicalsolutions. In addition to outlining desensitization of procedures based onCompany's standards, we successfully carried out comprehensive data maskingtransformations for both the membership and medical insurance systems. Thise?ort signi?cantly bolstered the security of our customer data.
Sensitive system data masking project
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Focusing on SelectiveRetailing for People'sWell-being
"
"
Yifeng Pharmacy understands that safe, e?ectiveand accessible medicines are vital to the Company'ssteady operation and are the foundation of ourhigh-quality development. We focus on selectiveretailing and have established a quality systemwith controllable sources and e?ective medicinesaccordingly. Besides, leveraging on our ownresources, we value the public needs and protectpeople's well-being with practical actions
Strategy of ControllableHigh-quality Medicines
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
At Yifeng Pharmacy, we incorporate the strategy of controllable high-qualitymedicines into our development . We continuously improve and create high-quality product collections such as private brands, exclusive varieties, andvarieties of medicines jointly developed by manufacturers and us. Besides, weexpand our product collections based on the Chinese and Western medicinesto categories such as Chinese medicines for healthcare, dietary supplements,healthcare equipment, personal care products, and health-related convenienceproducts, so as to provide customers with more medicines of reliable quality,precise e?cacy, high cost-e?ectiveness and clear and controllable sources.With the criterion of "o?ering reliable medicines for our family", we e?ectivelysafeguard people's health and safety, making us a trustworthy pharmacy.Quality and E?cacy GuaranteedYifeng Pharmacy always adheres to the policy of "Quality is the foundation ofYifeng". To be speci?c, we attach great importance to the quality of medicinesand continue to build an all-round quality management system throughout theentire lifecycle to regulate the production and operation of medicines, medicaldevices and other products. We ensure that all business processes are in strictcompliance with the Drug Administration Law?of the People's Republic of China,the Good Supply Practice for (GSP) and other laws and regulations, as well as theregulatory requirements of the sites where the directly managed and franchisedstores are located. Besides, we continuously internalise the standards andrequirements of state regulations and industry developments and formulate ourown policies and rules. In this way, we are committed to ensuring the medicationsafety of every patient, continuously improving the customer's experience whenbuying medicines, and actively ful?lling our social responsibility as a listedpharmaceutical retailer.
Quality and Safety Team BuildingWe understand that a quality team is crucial to the implementation of our quality management system. The responsible persons of ourquality management department are all quali?ed as licensed pharmacists and have more than 3 years' experience in quality managementof pharmaceutical operations. Besides, our quality management personnel have all obtained a junior college degree or above inPharmacology or Chinese Medicine and related studies and possess su?cient professionalism and problem-solving skills to addressquality and safety issues that may arise in the course of operations. Meanwhile, we have incorporated quality assessment indicators suchas quality accidents, product quality assessment, and the e?ectiveness of shelf life supervision into the performance appraisal of qualitymanagement personnel, so as to implement a management mechanism with traceable responsibility and clear rewards and penalties,and to enhance the supervisory responsibility and awareness of quality management personnel. In addition, we have extended our qualitymanagement requirements to store personnel by developing a rigorous annual training programme for all employees including newemployees, potential store managers and store managers. The programme includes training on the "GSP"pharmaceutical knowledge,quality management system documentation and special training to increase frontline employees' awareness of medicine-related laws andregulations and their knowledge of fundamental pharmacology, and to ensure that they have su?cient professional knowledge and skillsto e?ectively perform their quality management duties.Quality-related Risk Prevention and Control System
To continuously improve the quality-related risk prevention and control system and ensure the quality of medicines, we have establishedthe Yifeng Pharmacy Quality-related Risk Management Operating Procedures and the Yifeng Pharmacy Quality Products EvaluationCriteria, in which a beforehand or backtracking approach is adopted throughout the entire lifecycle of medicines to identify and managerisks that may a?ect the quality of medicines for all aspects. The Quality Management Department has a vote over the reviews of productswith non-compliant packaging or failed quality inspections.
Quality Management System for MedicinesTo ensure the quality of our products, we have formulated the YifengPharmacy Quality Guidelines and Targets Management Policy. Besides,we have assigned the responsibility of medicines quality managementto every employee in Yifeng by formulating and implementing theannual quality policy targets and the respective targets for eachdepartment, as well as inspecting, supervising and improving theimplementation e?ectiveness. In addition, we have established aquality management system based on the entire lifecycle of ourmedicines to ensure product quality and safety.
Medicine Procurement
We strictly implement the Yifeng Pharmacy Supplier QualityAssurance System Evaluation Criteria, Yifeng Pharmacy's SupplyUnits and Sales Personnel, First Purchased Variety ReviewManagement Policy, and other relevant regulations. In accordancewith the aforementioned regulations, we carry out veri?cation andevaluation of the supplier's production quality system through on-site inspection, researches on data and information and other formsto examine the product quality and the supplier's capabilities ofcontinuous supplying from source.We apply the approach of "centralized procurement at headquarterand local procurement at subsidiaries" for medicine procurement,taking procurement channels, price advantages and satisfactionrate on the stores' medicines as the core consideration, and adoptdi?erent procurement modes according to the attributes of themedicines to ensure its quality, traceability and a?ordability.
Medicine Delivery
We strictly implement the Yifeng Pharmacy MedicineDelivery Review and Management System and relevantoperating procedures, follow the principles of "?rst-produced products to be sold ?rst and products withcloser expiration date to be sold ?rst", and managethedelivery order according to the batch numbers.We review and con?rm the quality of the deliveredmedicines and their packages to ensure that they arequali?ed medicines with accurate quantities, properquality, and clear labelling.After-sales ServiceIn addition to displaying signs such as the supervision telephone number ofthe National Medical Products Administration, the service convention of YifengPharmacy, and sign of "no return of goods without quality problems" in eachstore, we have also set up a 24-hour service hotline (4008879908) and a customeropinion book for customers to express their opinions on our products andservices through various channels. We have also established a customer complaint?le and set up a special team , to ensure that all feedback and complaints can beproperly responded to in an e?ective and timely manner.
Medicine Recall
To ensure the safety of public medication, we have established theYifeng Pharmacy Unquali?ed Products Management Policy and theYifeng Pharmacy Medicine Recall Management Policy that have beensold and found to have serious quality problems, so as to ensureunquali?ed medicines are not sold on the market
In-store Display
All directly managed and franchised stores arerequired to display medicines in accordance withthe relevant provisions of the Yifeng PharmacyStore Medicine Display Management Policy toclassify medicines according to their physical andchemical properties and the storage requirements.Besides, the stores shall carry out regularmaintenance and inspection of the quality themedicines strictly in accordance with the YifengPharmacy Store Medicine Maintenance andInspection Management Policy and the YifengPharmacy Medicine Expiration Date ManagementPolicy, so as to ensure that any quality problemscan be discovered and properly handled in a timelymanner.
In-store AcceptanceMedicines at the stores are uniformlydistributed by the headquarterwarehouse. When the medicines aredelivered, each store performs thequality acceptance process in strictaccordance with the relevant provisionsof the Yifeng Pharmacy Store MedicineAcceptance Management Policy and theoperating procedures to ensure that thepackaging and quality of the medicinesreceived meet the requirements, so asto ensure the quality of medicines soldat retail stores.
Acceptance and Inspection
We strictly implement the YifengPharmacy Medicine AcceptanceManagement Policy and YifengPharmacy Acceptance Procedureand other regulations to inspect theappearance, packaging, labelling,instructions and other contents ofthe medicines in accordance with thesampling standards. And we will directlyreturn to the supplier , if any medicinesdo not meet the sampling standards orhave quality issues, so as to ensure thequality of the products
Medicine StorageWe strictly implement the YifengPharmacy Medicine Storage andMaintenance Management Policyand operating procedures to ensurethat medicines are stored in theappropriate warehouses accordingto their packaging and storagerequirements. Besides, we regularlycarry out maintenance inspectionson medicines in storage to ensuretheir quality.
Medicine Quality Management System
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Medicine Recall System
We classify medicine recalls into three levels according to the severityof the potential quality and safety risks of the medicines and setdi?erent deadlines for the recalls. Also, we require each store to notifypurchasers immediately upon the receipt of recall noti?cation toreturn the medicines with potential problems , and to stop selling themedicines at all stores. Besides, the stores are required to report thesituation of the recalled medicines to the National Medical ProductsAdministration or to notify the medicine manufacturer of the recallswithin the designated time limits, and to carry out the subsequenttreatment of the recalled medicines based on the di?erent resultscon?rmed by the National Medical Products Administration. We ensurethat we hold individuals accountable and keep a ?le of medicationrecall treatments to prevent the recurrence of such incidents.
Pharmacovigilance Management
We have also established a pharmacovigilance system through appointing specialists at our o?ine stores. The specialists shall promptly assess andanalyse adverse medicine reactions and medication errors as well as incidents of medicine damage, make appropriate records of incidents, andreport them in accordance with the prescribed procedures. In any situation where a medicine needs to be recalled, the medicine recall procedureshall be immediately initiated, so as to ensure the safety management of medicines. In addition, to prevent medication-related safety issues fromoccurring , we provide medication guidance and organise educational seminars for providing patients with professional support in the use ofmedicines, treatment and paramedical care.
Medicine Expiration Date ManagementWe have established the Yifeng Pharmacy Medicine Expiration Date Management Policy which requires stores not to sell medicines to be expiredin 30 days and expired medicines. Besides, we have adopted a regular product expiration date inspection mechanism to eliminate the saleand circulation of any expired products at our stores. In the event that expired products (including complimentary items) are found during theinspection, we will also hold those involved directly and their managers jointly and severally liable, so as to ensure that the responsibilities areindividual-speci?c.
De?nitions of Medicine Expiration Date
? Products with a expiration date of 12 months areconsidered expiring products if they will expire withinless than 4 months.? Products with a expiration date of 18 months or aboveare considered expiring products if they will expirewithin less than 6 months.
? Products with a expiration date of 12 months are
considered to be in warning period if they will expirewithin less than 6 months.? Products with a expiration date of 18 months areconsidered to be in warning period if they will expirewithin 9 months.
Expiring MedicinesMedicines in Warning Period
First-level RecallAn urgent recall must be completed within 24 hours if the useof the medicine may cause a serious health hazard.
Second-level RecallA recall must be completed within 48 hours if the use of themedicine may cause a temporary or reversible health hazard.
Medicine Recall System
Third-level Recall
A recall must be completed within 72 hours of the receipt of therecall noti?cation if the use of the medicine does not generallycause health hazards but the medicine needs to be recalled forother reasons.
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Medication with Reasonableness and Precision
Based on quality product system of high e?cacy, Yifeng Pharmacy comprehensively promotes the "peak-end experience" mode leveraged on strong professionalism, and implements the full-process service withthe principles of "Three Dos" and "Three Nos". Guided by the principle of "sel?essness and altruism", weemphasize the mission of "making people physically and mentally healthier" and the vision of "becomingthe preferred pharmacy worthy of trust and entrustment", guiding our employees to meet customers'needs emotionally and consciously. To enhance service professionalism of frontline employees, we haveestablished a sound training system and continuously increasing investment in cultivating numerousfrontline personnel into health advisors with pharmacist quali?cations who can provide professionalmedication advice and health guidance to clients. At the same time, we take "precise medication" as thestarting point, requiring frontline health consultants to accurately recommend drugs that meet the needsof customers according to their illnesses, so as to prescribe the right medicine for the illness. We regularlytrain, supervise, and assess frontline employees in strict accordance with standardized requirements,fully protecting customers' physical and mental health and purchasing experience.
Controllable Channels for Medicines
In order to ensure the safety and reliable source of medicines, Yifeng Pharmacy has formulated a seriesof supplier management policies, such as the Yifeng Pharmacy Supply Units and Sales Personnel, FirstPurchased Variety Review Management Policy the Yifeng Pharmacy Quality Management System ExternalAudit Management Policy, and the Yifeng Pharmacy Supplier Quality Assurance System Evaluation Criteria, inaccordance with the requirements of the Drug Administration Law?of the People's Republic of China, the GoodSupply Practice for Drugs, and the Good Manufacturing Practice for Drugs (GMP) , so as to establish a soundsupplier management system through clarifying the management mechanism of supplier approval, assessmentand classi?cation.We also pay attention to the environmental and social risks of our suppliers and focus on integratingsustainability mindset into our supply chain management processes. We adhere to the principle of greenprocurement, give priority to the suppliers that meet the quali?cations and requirements and have a moreenvironmentally-friendly concept, and prevent to cooperate with any supplier that does not meet the nationalenvironmental protection requirements. Meanwhile, we encourage suppliers to ship nearby to reduce thenegative environmental impacts resulted from logistics. We are committed to taking corporate social complianceand employment norms as one of the cooperation requirements. We focus on supplier turnover and employees'corporate identity, with a view to build long-term stable cooperation relationships.
Supplier Assess
We are committed to source control. Before choosing a new supplier, we will ?rst inspect, evaluate and rank thesupply unit, the variety of goods, and the sales sta? of the supply unit to ensure the quality of its products andthe ability of continuous supplying, and then we further enter into business transactions with the supplier.In the meantime, to ensure the integrity and fairness of the supply chain operation, we strictly abide by theAnti-Unfair Competition Law of the People's Republic of China and other relevant provisions prohibitingcommercial bribery, and have formulated internal policies such as the Yifeng Pharmacy Ten "Red Lines" of theCode of Conduct, the Yifeng Pharmacy Anti-Commercial Bribery Management Policy, and the Regulations on theIntegrity and Self-discipline Management of Yifeng Pharmacy Employees. These policies clearly stipulated thatprocurement employees need to use the mobile phones equipped by the Company, and they shall not engage inany form of bribery, commercial violations and other acts with any suppliers, service providers and contractorswho have business and economic exchanges with the Company. Besides, we require all suppliers to sign theIntegrity Agreement to ensure that the quality of medicines is controllable and the supply is stable from thesource.
"Three Dos","Three Nos"principles
"Three Dos"? To o?er the right medicines for theillnesses? To recommend medicines according
to the needs of customers? To explain the reasons for our
recommendations
"Three Nos"? Do not be pushy? Do not present unpleasant feelings
to customers? Do not follow customers for
recommending
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Assessment and Evaluation of SuppliersIn order to ensure the reliable quality and e?cacy of products, we have established a catalogue system for quality products. Only if those passingthrough a re?ned quali?cation review mechanism and a triple quality evaluation system, including on-site inspection of suppliers, qualitycomparison and inspection, evaluation of e?cacy and quality perception can be chosen as the quality medicines recommending for the familymembers . In addition, we will also supervise the production of speci?c suppliers and medicine manufacturers, focusing on the quality controlof raw materials，intermediate products and ?nished products and the implementation of production process. During the reporting period, weconducted 1,555 on-site supplier visits, 1,488 batches of key varieties for quality comparison and inspection, 1,375 varieties of medicines werereviewed om e?cacy and quality perception .
Supplier Classi?cation and TierManagement
To ensure the stable production and reliable quality of medicines,we carry out comprehensive evaluation at the end of each year, andclassify suppliers into ?ve grades of A, B, C, D and E according to theresults. Besides, we implement a classi?ed supplier managementbased on the grades, that is, we perform di?erent cooperation andrecti?cation e?orts for suppliers with di?erent grades.
Grades of Suppliers in 2023
GradesNumber of Suppliers
A
B1,148
C1,227D
E
The Quality Control Management Department will send special personnel to implement unannounced inspectionsto the potential suppliers, and assess and rank the quality management system of the enterprise according to keyinspection points set out in the GMP, so as to understand the actual condition of the enterprise.
On-Site Visits
We monitor and correlate key indicators, including content, related substances, heavy metals, solubility, contentuniformity, friability, and carry out result comparison among products of the same category.
QualityComparison and
Inspection
The Quality Control Management Department invites the store's health advisors to conduct paper or onlinequestionnaires on perceived e?cacy, perceived quality of appearance of products, perceived packaging andperceived brand.
Reviewson E?cacyand QualityPerception
Triple Quality Evaluation System
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Care for People's Well-being
As one of the leading retail pharmaceutical companies, we care for people's well-being and hope to set upan industry benchmark for the health-related welfare and charity. Besides, we are always with the originalintention of " customers ?rst", we strive to make substantial contributions to the health and safety of ourcustomers by developing scenario-based services that meet their actual and potential needs, ranging frompharmacy services, preventive healthcare, medication tracking, chronic disease management, healthy lifeadvisors to comprehensive health management solutions.
Customer Rights and Bene?tsYifeng Pharmacy attaches great importance to building trust with customers through professional andheartfelt services. With our customers as the core, we have established a comprehensive and clearmembership system and launched a diversi?ed "88" membership programme to ensure that every membercan enjoy 8 additional rights and bene?ts such as member price, member points, exclusive health advisorsand other bene?ts, while experiencing 8 professional member services such as tea and umbrella formembers, and traditional chinese medicine decoction service. We are committed to delivering member-centered health management across all channels, scenarios, and lifecycle stages. While implementingthe "88" membership rights and bene?ts for each member, we focus on the construction of chronic non-communicable disease (hereinafter referred to as "chronic disease") management services, with an emphasison the management of complaints and standardising marketing and publicity.Through the continuous improvement of the information management system, we provide customers withdi?erentiated services and appoint chronic disease management specialists to provide customers withprofessional medication guidance, medication reminders, disease course management, health check, healtheducation and other services, so as to enhance customers' knowledge about diseases and their awarenessof self-management and improve their medication adherence, thereby e?ectively promoting health for all. In2023, we have accumulated services for chronic disease patients exceeding 80 million person-time.
Customers Satisfaction SurveyTo intentionally listen to the voice of customers, we conduct a customer satisfaction survey every quarterto understand the real thoughts of customers from three aspects, namely the free membership service,medicine variety, quality and price of medicines, and etc. Based on the survey results, we analyse customeropinions thoroughly, compile the quarterly NPS (Net Promoter Score) from Customers Survey Report, carryout year-on-year and quarter-on-quarter analysis of the survey scores, and carry out customer-speci?canalysis base on the evaluation indicators. On the basis of this report, we will continue to improve the qualityof service and fundamentally solve customers' concern. In 2023, more than 10,000 surveys were e?ectivelyreceived from quarterly customer satisfaction surveys.
Complaint ManagementWe also focus on the management of customers' complaints. We set up the "400 Call Centre" and "OnlineCustomer Service" that customers can provide feedback or make complaints through the channels. Also, wehave corresponding response mechanisms for di?erent types of customer complaints as the protection ofcustomers' rights and interests is always our top priority. When customers dial in for complaints or submitcomplaints online, we record basic information including the speci?c time, location, and details of compliant,claims of the complaint, and customers' contact information. We then determine the response approach tobe taken based on the nature of the complaint, and ensure that a ?nal solution will be provided within 48hours. After a customer complaint case is completed, we will carry out internal procedures immediately. Wecompile statistics on complaint types, data, and handling methods in a regular basis, and we use these casesas a reference to send to all stores, aiming to avoid similar incidents. In 2023, the average waiting time forcustomer service calls was 54 seconds (system-prompted waiting time), the average response time was 5seconds (average time to answer incoming calls according to system prompts), and the problem resolutionrate was 97.70%.
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Responsible MarketingYifeng Pharmacy stands ?rmly on the compliant advertising ofmedicines, and emphasises the authenticity and accuracy ofpromotional contents in both self-operated and franchised stores.Yifeng Pharmacy ensures that the introduction of product descriptionsstrictly adheres to the respective medication package inserts andprovides truthful information on therapeutic e?ects, adversereactions, contraindications, and precautions. False advertising, suchas exaggerating e?cacy or downplaying adverse e?ects, is strictlyprohibited. Operating within the framework of the Advertising Lawof the People's Republic of China and local regulations of operationlocations, we produce promotional materials, seasonal campaigns,and advertisements and deliver these to all our self-operated andfranchised stores. Additionally,subject to approval and compliancein advance, we encourage franchisees to develop tailored advertisingand marketing strategies to enhance Yifeng Pharmacy's brandrecognition and impact within their respective market segments.
Caring for Livelihoods
Today, businesses serve not just as engines of economic growth but also as vital roles of social responsibility and community enhancement. As aleading player in the healthcare business, Yifeng Pharmacy has consistently valued the realisation of its social value and embraced its corporateresponsibility. Through an array of public welfare initiatives and community engagement activities, we strive to contribute to the well-being of thepublic.Re?ecting back, Yifeng Pharmacy has achieved remarkable results in improving livelihoods. By the end of 2023, we had made donations andmaterial contribution of over RMB 67.2 million. We have successfully held over 1,500 charity events and delivered more than 10,000 health lectures,directly bene?ting nearly 3 million people with chronic diseases and middle-aged and elderly people. Looking ahead, we will remain committed toour corporate social responsibility, furthering our e?orts to promote the overall health and harmonious development of society.Expired Medicines Recycling Initiative
To facilitate regulations on the medicine market, enhance medicine qualityand public safety in medicine use, and reduce the environmental impactcaused by disorderly medicine waste, Yifeng Pharmacy has been engaged inthe collection and disposal of expired medicines. In 2023, we partnered withlocal Administrations for Market Regulation in ten provinces and municipalities,including Hunan, Shanghai, Guangdong, Hubei, Jiangsu, Jiangxi, and Hebeiprovinces or municipalities, to organise 235 public welfare events of "Cleaningout expired medicines with Yifeng for better health".To encourage public participation, we o?ered unconditional coupons or handymedicine boxes to participants based on the types and quantities of expiredmedicines they provided. We carefully managed and registered the collectedexpired medicines before packaging and returning them to the warehouse.The expired medicines were then handed over to professional companiesresponsible for hazardous waste management for safe and eco-friendly disposal,securing both environmental safety and public health.
"Cleaning out Expired Medicines with Yifeng for Better Health"
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Safe Medication Themed Event
To deepen public understanding of the importance of safe medication and enhance people's awareness in the scienti?cselection of medicines and rational medication, Yifeng Pharmacy planned and held the public welfare event of "YifengPharmacy Secures Health with Safe Medication in the Community" campaign in 2023 to create a safe, trustworthy, andhealthy medication environment. The campaign represented our e?ort to strengthen education and guidance on medicationfor local community residents and enhance our brand image. At the site of the campaign, we presented how to properlydispose the expired medicines, as well as how to use and manage them safely and e?ectively.The event was successfully held in 2,929 Yifeng Pharmacy stores nationwide, with a total of 3,741 educational and serviceactivities completed, bene?ting over 190,000 customers.
Supporting Flood-a?ected Areas in Baoding, HebeiProvinceIn the summer of 2023, extreme heavy rainfall caused by a typhoon led to severe ?oodingin many areas of Hebei Province. Faced with this emergency, we took immediate actionsto support the relief e?ort. Leveraging on our operational and logistical advantages in thenorth China region, we mobilised more than 100 employees to deliver 3,100 medical suppliesincluding disinfectants, gastrointestinal medicines, and heatstroke remedies, as well as4,000 daily necessities such as water, instant noodles and so on. These supports helped withdisinfection e?orts after the disaster and secured public health, providing strong support forthe recovery and reconstruction of the a?ected areas.
Donation for Hebei Flood Disaster Relief "Yifeng Pharmacy Secures Health with Safe Medication in the Community" campaign
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
"Tribute to Workers" Donation Campaign
Yifeng Pharmacy, in collaboration with the Changsha Charity Foundation and Alipay, launched the "Tribute toWorkers" Donation Campaign for honouring and supporting workers. During the International Worker's Day,Yifeng Pharmacy distributed free, specially designed "Care Cards" to workers, so that cardholders could usethe card at our nationwide stores to purchase medicines, health products, and services. These cards not onlyrepresent our recognition of their hard work but also our care for their well-being.Furthermore, by leveraging on our online platforms, we opened donation channels for our nine subsidiaries,e?ectively facilitating over 800,000 donations and taking a solid step forward collaboratively with the publicon the path towards social welfare.
"Cooling Down in Summer with Yifeng" Public Welfare DonationCampaignIn August 2023, Yifeng Pharmacy conducted a one-month public welfare campaign titled "Cooling Down inSummer with Yifeng" in ten provinces and municipalities including Hunan, Shanghai, Guangdong, Hubei,Jiangsu, Jiangxi, and Hebei, to pay tribute to the workers who are indispensable for the maintenance ofurban infrastructures.During this campaign, donated supplies worth nearly RMB 2 million to urban service workers such assanitation workers, tra?c polices, urban management o?cers, and ?re?ghters to support their work andcater for their needs in their work and daily lives during the burning summer.
"Tribute to Workers" Donation Campaign"Cooling Down in Summer with Yifeng" Public Welfare Campaign
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailingfor People's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Empowering HealthcareAccessibility andSafeguarding Public Health
As a leading chain pharmacy in China, YifengPharmacy focuses on providing customers withhigh-quality, cost-e?ective medicines, as well asreliable and convenient pharmaceutical services. Weadhere to the business philosophy of "fair pricingwith professional service," and always put customerneeds ?rst. As we continuously explore the diversehealthcare needs of our customers, we are extendingour services beyond the conventional form ofpharmacy to traditional Chinese medicine (TCM)hall, the room for the diagnosis of the practitioner ofChinese medicine, outpatient departments, in-storeclinics, Internet healthcare services, HengxiutangTCM factory and upstream services. In this way, weaim to providing comprehensive healthcare solutionsfor public well-being.
"
"
Yifeng Pharmacy adheres to the development strategy of "holding regional focuses and performing steady expansion", andcontinues to improve the breadth and depth of store network coverage through the expansion model of "new store + mergerand acquisition + franchise" to fully meet the real-time needs of customers. While comprehensively expanding the onlineand o?ine business layout of Yifeng Pharmacy, we expect to extend the economies of scale to the consumer experience, andwe strive to provide customers with high-quality products and services that perform well in accessibility, variety, timeliness,reasonable pricing, and supply stability
We have established long-term and in-depth strategic partnerships with 89% of China's top 100 pharmaceuticalcompanies, and have been continuously upgrading our logistics network to complete express delivery within 48 hoursnationally and 24 hours provincially.
Supply stability
AccessibilityVariety
While expanding our o?ine stores and establishinga modernised logistics network, we are working toestablish online stores and Internet hospital to providecustomers with one-stop healthcare experiences athome.
We have partnered with leading global pharmaceuticalcompanies and Chinese top 100 pharmaceuticalenterprises, o?ering over 70,000 SKUs covering classicmedicines, niche varieties, local specialties, newspeci?c drugs (Direct to Patient, DTP) and so on.
TimelinessReasonable pricingWe set up 24-hour service stores to meet the needs ofmedication patients at any time of the day or night.Customers can order online via mobile phones andreceive medicines at home within an average of 30minutes.
Leveraging our procurement scale of over RMB10 billion, we set out to make nationwide pricecomparisons through non-centralised procurement,integrated channels, and repeated price negotiations,striving to pass on price advantages directly to ourcustomers.
As of December 31, 2023
Yifeng Pharmacy has a total ofself-operated stores
10,264
Yifeng Pharmacy has a total ofoperating DTPspeci?c drug stores
nearlyonline stores(including franchise stores)
10,000
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
?agship stores
designated stores for "dual channel"medical insurance
hospital-side stores
outpatient coordinated medicalinsurance stores4,200+
24-hour stores600+
Chinese medicine clinics30+
medium-sized community stores1,023
regional center stores
small communitystores9,120
Building Our Retailing NetworkWe value our retail network in a way that we provide precise and comprehensive online and o?ine services to our customers. Onthe o?ine side, our store network continues to expand with a "?eet-type" layout, with the focus on developing the stores in 10 keyprovinces and cities, 42 prefecture-level cities and more than 130 county-level cities in the Central South China, East China, and NorthChina. On the online side, we are further building conventional and new retail systems, including 4 intelligent retail channels, whichare the "Business to Customer" (B2C), "Online to O?ine" (O2O), "Yifeng Mobile Application + WeChat Mini Programme" (APP + MiniProgramme), and "Construction of Private Domain" as well as new retail channels like Internet hospital and e-prescribing. These e?ortsrepresent our vision of providing customers with more accessible and cost-e?ective products and more thoughtful services. Meanwhile,to extend the in?uence of our brand philosophy, operation model and social value to those interested in pharmaceutical retailing, wehave opened up direct-operated franchise opportunities. While empowering franchisees and franchise stores for stable operations, westrive to provide customers with more accessible goods and services.
Layout of O?ine Retailing
We have established an o?ine retailing network covering di?erent cities andbusiness districts, tailored to the population and customer demands in di?erentregions. This network includes ?agship stores, regional centre stores, medium-sized community stores, and small-sized community stores, with stores distributedlike a "?eet". In ?agship and regional centre stores, we focus on providing a "one-stop" service with a full range of products. In medium and small-sized communitystores, we focus on the accessibility to medicines by o?ering a variety of medicinesin di?erent areas, providing local residents with more accurate products andservices as they needed.Meanwhile, with "thoughtful service + new retail" as the starting point, wecontinue to build speci?c drug stores (DTP speci?c drug stores ), designatedstores for "dual-channel" medical insurance, special and chronic diseases medicalinsurance coordinated stores, hospital-side stores , and 24-hour service stores.We also continue to build a comprehensive disease management system forpre-medication diagnosis, continuous treatment and tracking, rehabilitationmanagement and follow-up, aiming to further improve the professional andsystematic services of Yifeng Pharmacy. Additionally, we have sta?ed DTPspeci?c drug stores with chronic disease management specialists who providechronic disease patients with professional target management, testing services,interpretation of report indicators, medication guidance, medication reminders,health education, diet and exercise guidance, and other services. By doing so, weaim to improve people's knowledge about their diseases and their awareness ofconducting self-care for their diseases. We believe in the principle of prioritizingour customers, and our 24-hour service stores provide 24/7 self-pickup and homedelivery services within a vicinity of 3km, while hospital-side stores are locatedwithin 500 meters of hospitals. These stores provide customers with better, faster,and more convenient medication services within residential areas.O?ine RetailingStoresRetailing
SpecialStoresFlagship Stores
Spec?c Drug Stores(DTP Speci?c Drug Stores)Regional Centre Stores
Designated Stores for "DualChannel" Medical InsuranceMedium-sized Community Stores
Special and ChronicDiseases Medical InsuranceCoordinated StoresSmall-sized Community Stores
Hospital-side Stores24-hour Service StoresTraditionalChineseMedicineClinics
FranchisedStores
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Online Retailing ChannelsIn addition to o?ine stores sales and chronic disease managementservices, Yifeng Pharmacy has also made sustained e?orts toexplore and develop more new functions and business models whileconstructing new DTP speci?c drug stores. At Yifeng Pharmacy, weleverage the foundation of o?ine stores and customer membership,while supported by the conventional online sales model, tocontinuously build an ecosystem of a new pharmaceutical retailsystem based on membership, big data, Internet healthcare andhealth management, facilitating the convenience when customerspurchase products.
Private Domain Community
Online Retailing
B2C/O2OAPP+Mini Programme
Internet Hospital
In terms of B2C and O2O retailing channels, we have successfullyintegrated and operated on third-party platforms such as Meituan, Ele.me, Tmall, Pinduoduo, and JD.com. Nearly 10,000 stores, including2,956 franchised stores, have opened up online stores. This ensuresthat online orders are delivered within 30 minutes to e?ectively meetcustomers' urgent needs in purchasing and using medicines. Toenable customers have the most a?ordable products and bene?tswhether they shop online or o?ine, our APP+Mini Programmesynchronise online and o?ine product inventories, o?eringconsistency in membership, pricing, and promotions on all platforms.Additionally, we continuously enrich and expand our online o?ering byincorporating more third-party drop-shipping or imported products.As for the construction of private domain community, we not onlyprovide professional medication advice but also create a socialisingplatform for mutual help and support. This allows customers timelyaccess to the latest medication information, health knowledge, andwellness tips anytime, anywhere, and share experiences with fellowmembers who have similar needs for their health.At the same time, we are vigorously deepening the construction ofthe Internet hospital service system, providing patients with moreconvenient and e?cient health consultations, online consultations,family doctors, and chronic disease management services, whileproviding an online platform for the practice of more high-qualitydoctors in multiple sites. We have over 1,100 multi-sites medicalpractitioners covering departments such as internal medicine, surgery,gynaecology and obstetrics, paediatrics, and traditional Chinesemedicine. We have established cooperation with several hospitalswithin and outside Hunan Province to provide customers with moree?cient health consultations, chronic disease management, familydoctor services, and continuous promotion of accessible healthcareand medicines through digital approaches. Additionally, as one ofthe ?rst companies to access the prescription circulation platformin Hunan Province, we have achieved the circulation of medicinesfrom doctors to stores to patients in multiple regions and graduallyestablished outpatient patient communities, forming a closed loop forthe circulation of hospital prescription.
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Retailing Network ofFranchiseesAs a pioneer in pharmaceutical retailing and Internet healthcare,we aim to deliver our philosophy about the trusted brand valuesand comprehensive health service through quality pharmaceuticalretailing and professional stores services, contributing to the physicaland mental well-being of our customers. We also maintain highstandards in regulating franchisee operations, adhere to the "SevenUni?cations" management approach, and leverage big data forprecise site selection and the establishment of intelligent franchisesystems to safeguard customers' health with a wider retailing network.This enables not only the quality improvement in new stores, butalso comprehensive management of products, membership, andoperations in franchised stores.
Uni?edstandards forpharmaceuticalservicesUni?ed billmanagement
Uni?edmanagement
system
Uni?edprocurementand delivery
Uni?edcomputer
systemUni?edpersonnel
training
Uni?edcorporateidenti?cation
Before the o?cial opening, to maintain brand consistency, alldecoration designs and basic decoration (renovation) constructionof franchised stores, are carried out by companies arranged anddesignated by Yifeng Pharmacy. All materials bearing the "YifengPharmacy" logo used in construction must be purchased fromdesignated sites. To standardise subsequent management, wealso require network cabling and the installation of the Company'sdesignated video surveillance system in all franchised stores duringdecoration. In addition, to ensure legal and compliant operations andsafeguard product quality and safety, Yifeng Pharmacy requires allfranchised stores to obtain the necessary business licenses and relatedquali?cations, including but not limited to Drug Business License,Business License, Food Distribution License, and Class II MedicalDevices Recordation Certi?cate. Furthermore, we require franchisedstores to strictly implement quality control measures in accordancewith the Drug Administration Law and the Good Supply Practice forDrugs, and to take irregular inspections and GSP inspections, ensuringhigh-quality pharmaceutical services at retailing stores.Franchised stores must pass the pre-opening review before o?ciallyopening for business, to avoid situations such as unquali?eddecorations and equipment, failure to obtain relevant businesslicences, and untrained and unquali?ed sta?. During operation,Yifeng Pharmacy requires franchised stores and their employeesto adhere to and implement the Company's corporate culture andbusiness philosophy, comply with various management systems andoperational processes including the "Seven Uni?cations", and conductbusiness sales as required, to provide customers with safe and high-quality services. We also provide regular training and guidanceon uni?ed service and management models for franchised stores,including regular operational and technical training and assessmentsfor the employees, store managers, and regional directors, to enhancethe quality of franchised stores management. To ensure properimplementation by franchised stores, we conduct regular supervision
and inspections on franchised stores to ensure their compliance withquality, service and standards, thereby ensuring medication safety forcustomers and maintaining a good industry order.As the sole supplier to all franchised stores, we employ uni?edprocurement to control product costs and uni?ed delivery toguarantee product quality. We also require franchised stores to strictlyadhere to uni?ed pricing and discount systems, ensuring consistentpricing and discounts between self-operated stores and franchisedstores. In addition, we closely supervise and manage franchisedstores' distribution of medicines, inventory, returns and so on, toensure that they provide customers with fairly priced & high-qualityproducts and professional & accessible services.
"Seven Uni?cations" Management
"SevenUni?cations"
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Digital OperationAt Yifeng Pharmacy, we recognise that digital management methods are the key to e?ective management of pharmaceutical retailers, and thecrucial supporter to deliver on our promises to customers. We comprehensively plan the digital system of Yifeng Pharmacy, steadily promotethe system research and development of middle end and front end, aiming to empower the traditional operation management through digitalintelligence technology, thereby building the strong competitiveness of Yifeng Pharmacy. In 2023, the Company spent RMB 33,549,984.91 on R&D, a
32.56% year-on-year growth.
Our digital system can support stores' operations, POS payment, medical insurance service, public domain platform, medical products supervisionand so on. Internally, it can undertake various functional modules such as personnel, ?nance and administration of the headquarters, and realizee?cient management and process optimization of internal operations while ensuring rapid and steady business development.
Framework of Digital System
PublicDomainPlatformTechnical Service Middle EndCache
Messagequeue
DatabaseTracing
Highavailability
Highconcurrency
Human ResourcesFinanceOA
Business Intelligent
Middle EndEventTrackingUser Pro?le
Business Middle EndProductTransaction
Salesman
Quality
Marketing
Task
DatagovernanceDataapplicationMembership
Payment
OpendPlatform
MedicalInsurance
Medical
ProductsSupervision
Retailing
Stores
Pointof Sales
(POS)
Headquarter
EmployeesUsers
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Operation Digitalization
By leveraging new technologies and data capabilities to reshape operations, we continuously enhance the customer experience atour stores and improve operational e?ciency. Through our own employees online mini-program (Yidianzhang), we empower allemployees to achieve comprehensive online management of store operations, marketing, data, performance and remuneration.This enables them to provide professional services such as consultation, chronic disease management, and testing for our 87.1million members. Additionally, we utilize big data for precise site selection and store opening, assisting nearly 1,000 new storesannually to improve quality. Through the Yifeng franchise system, we empower franchised stores to achieve comprehensive onlinemanagement of products, members, and operations, thereby driving performance growth.
New Retail DigitalizationWe adhere to integrated development and have created a series of digital products tailored to the scenarios of new retail business.We have focused on completing the construction of platforms such as public domain, private domain, and internet hospitalto comprehensively support the "new retail + thoughtful retail" strategic upgrade, facilitating the transformation of retailingdigitization. As of the end of the reporting period, over 9,000 direct-operated O2O stores of Yifeng Pharmacy have been launchedonline . The e?ciency of picking, delivery and labour productivity are all at the industry-leading level.
Human Resources DigitalizationWe delve into the digitization of human resources, aligning with the Company'sdevelopment strategy of management online, digitization, and intelligence. Duringthe reporting period, we achieved breakthroughs in digitizing the human resourcessystem, covering various aspects including recruitment, contracting, performanceevaluation, remuneration, promotion, scheduling attendance, talent inventory anddevelopment.
Financial DigitalizationWe continuously re?ne the integrated development of business and ?nance, aimingto provide high-quality ?nancial services and ?nancial management under rapidexpansion, while implementing various measures to reduce costs and increasee?ciency. We have achieved intelligent and automated construction in variousaspects including budgeting, cost management, expense reimbursement, ledgermanagement, sales reconciliation, electronic invoicing, fund management andleasing.
Logistics Digitization
In order to achieve precise control over logistics information, we have developedthe Yifeng Transportation Management System (TMS), which covers functions suchas dispatch management, freight calculation, temperature and humidity monitoringand turnover box management. We have successfully implemented end-to-endmanagement of logistics information, ensuring both improved logistics distributione?ciency and product quality. During the reporting period, the daily shipmentamount of Yifeng Pharmacy's warehouses reached 800,000 line orders, with ashipment accuracy rate near 100%.
Membership Digitalization
Through re?ned member operations, channel construction, and precision marketing activities, we actively promote online diagnosis& treatment services and chronic disease management services, enhancing user repurchase rates. Combined with user pro?les, wee?ectively strengthen users' value recognition and expertise reliance on Yifeng Pharmacy. As of the end of the reporting period, thenumber of online members reached over 87.1 million.
Product Digitalization
Focusing on building the most e?cient and sensitive commodity digitalization system in the industry, we completed the onlinesupplier rebate, intelligent replenishment, intelligent coordination, intelligent return and the national medical cold and shortage ofrapid procurement system during the reporting period, realizing the comprehensive online, digital and intelligent transformation ofcommodity business, and achieving signi?cant breakthroughs in inventory turnover e?ciency.
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
E?cient LogisticsDistribution
With a strong digital intelligence technology research anddevelopment (R&D) and application team and in line with theCompany's actual needs, we have developed a digital logistics systemcovering warehouse operation management, logistics transportationmanagement and logistics operation management. Based on suchsystem, we identify system improvement points based on the 3Cprinciples (Cost, Close, Convenient), to e?ectively enhance end-to-end service capabilities in logistics distribution, and live up to ourcommitment to customers to "deliver with care, e?ciency, timelinessand perfection".
By the end of the reporting period, we had established and continuously upgraded seven modern provincial logistics centres in Hunan, Hubei,Jiangsu, Shanghai, Jiangxi, Guangdong and Hebei. We had also upgraded six urban delivery centres such as Wuxi and Huai'an, and realised onlinemanagement of production, retailing, e-commerce, and other businesses for 16 warehouses, to ensure timely and accurate delivery to all customers
The 3C Principles
CloseTo be closer to stores/usersCostTo become more advantageous
in terms of cost
ConvenientTo be more convenient
The Shanghai warehouse covers a total area of 30,000 m
, housesapproximately 6,000 types of goods, including medical devices andmedicines, and serves nearly 1,000 stores in Shanghai, with an averagedaily delivery to 300 stores. For goods picking, we introduce 45 P800V6 robots, 4 replenishment workstations, 10 picking workstations,and other intelligent equipment and tools to complete automatedreplenishment, shelving and picking of medicines and medicaldevices.
Shanghai warehouse
The Wuhan warehouse is the largest allocation centre of YifengPharmacy nationwide which will adopt full-process automation. Withan area of approximately 60,000 m
, Wuhan warehouse is expected tohandle the depalletizing and picking of up to 300,000 lines of ordersper day, meeting the needs of thousands of stores in Wuhan in thefuture.
Wuhan warehouse
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
The automation of Yifeng Pharmacy's logistics network is closely aligned with its business. We take into account the varying medicines demand and return quantities of each retailing store to determine the scale of logisticscentres in di?erent locations, ensuring e?ective improvements of work e?ciency in goods acceptance inspection and shelving, depalletizing and picking, checking, collecting and loading, returns and other reverse logisticsprocesses and so on.Yifeng Pharmacy continues to promote the visualization and intelligent management of warehousing processes such as inbound goods, outbound goods, and inventory management. This includes the introduction of advancedequipment and technologies such as automatic conveyors, automatic sorting system, AGV (Automatic Guided Vehicle) goods-to-person picking system, Minload intelligent automatic replenishment system, electronic labelling,wireless radio frequency (RF) picking, acceptance system and intelligent goods collection system.
AGV goods-to-person picking system intelligently and automaticallytransports and picks up items from corresponding shelves in thewarehouse based on the pickup demands submitted by stores. Eachworkstation can handle picking for up to 40 stores simultaneously. Theintroduction of AGV greatly enhances picking e?ciency and accuracy.
Minload intelligent automatic replenishment system guides palletizersto automatically replenish depalletized locations. Combined withone-to-one electronic labels and picking mode settings, it improvespicking e?ciency by 42.8%.
Picking system with electronic labels not only assists pickers inquickly and accurately locating goods but also provides the optimalpicking routes based on picking strategies and route planning, therebyimproving manual picking e?ciency and accuracy.
Minload Intelligent Automatic Replenishment SystemPicking System with Electronic Labels
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
AGV Robots
Automated Stereoscopic Warehousing System
The Automated Stereoscopic Warehousing System integrates logistics,information, and automation technologies into an advanced system.The stereoscopic design of the system maximises warehouse spaceutilization and reduces manual intervention through automation,enabling rapid and accurate retrieval and store goods in thewarehouse.
Connected to the Warehouse Control System (WCS), ProgrammableLogic Controller (PLC) and Warehouse Management System (WMS),the Multi-Shuttle Automated Storage System automatically sortsstore packages and transmits consolidation data to the TransportManagement System (TMS), providing automated sorting andimproving consolidation e?ciency and storage space.
Intelligent Storage System
In the future, Yifeng Pharmacy will continueto adopt management modes, equipmenttechnologies, and operational processes tailoredto own characteristics, operational stages, andbusiness scenarios to create a more e?cient andcost-e?ective supply chain logistics system. Bythese e?orts, we aim to build the Company's corecompetitiveness and ultimately achieve healthyand sustainable development.
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Cultivating a ProfessionalTeam and Realising theValue of Talents
"
"
As a pioneer in the pharmaceutical retailingindustry, Yifeng Pharmacy has always adhered to thebusiness philosophy of being "people-oriented". Westrictly implement legal and compliant employmentand continuously improve employment systems tofully protect the rights and interests of employees.We also comprehensively reinforce talent trainingsystems to support employee development andhelp them realise their personal value. In addition,we pay close attention to employee communicationand care for them by establishing smoothcommunication channels, optimising employeebene?ts, and creating a harmonious and e?cientworking environment. At the same time, we attachgreat importance to employees' occupational healthand safety and implement key safety measures. Allof these e?orts demonstrate our commitment toful?l corporate responsibility.
Compliant Employment
At Yifeng Pharmacy, we strictly follow laws and regulations such as the Labour Law of the People' Republic of China, the Labour Contract Law of thePeople's Republic of China, the Provisions on the Prohibition of Child Labour, and the Provisions of the State Council on Working Hours of Workersand Sta?, and formulate and implement comprehensive internal policies to ensure legal and compliant employment and e?ectively protect therights and interests of employees.
We conduct recruitment with openness, fairness, and impartiality,avoiding any discriminatory words, deeds, or judgements in theselection of talents, including but not limited to discrimination basedon ethnicity, race, skin colour, gender, religion, and age. We arecommitted to creating an equal, fair, diverse and inclusive workplacefor employees.The distribution of our employees is shown in the table below.
By gender
By job position
By employee category
We explicitly prohibit the employment of child labour and forcedlabour and oppose any form of discrimination and harassment. Werequire recruitment sta? to strictly verify the personal information ofapplicants before the o?cial employment. If any incidents of childlabour and forced labour are discovered, we will promptly take seriousactions against the responsible person depending on the severityof the situation. In 2023, we had no incidents of child labour, forcedlabour, discrimination or harassment.We always prioritise the protection of employees' rights and interests,to ensure that their legitimate rights and interests are not violated. Asof the end of 2023, we did not have any situations where employeerights were infringed due to major operational changes. At the sametime, we place great emphasis on talent retention by developingthe Measures for the Management of Employees' Resignation. Weregularly contact those who have left the Company and improveincentive measures to attract and retain outstanding talents.
employees
39,652
Senior managersMiddle managersFirst-line managersOrdinary employees
10,69328,576Male5,699Female33,953
Administration3,470
Delivery1,414Production
Sale33,751Finance
Technology
the Company had a total of
Proportion of female senior managers27%Proportion of senior managementhired from the local community
54%
employment were providedby franchised stores12,816
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Talent DevelopmentAdhering to a development philosophy of being "people-oriented", we have established comprehensive talent development systems tocontinuously enhance employees' professional competence and comprehensive capabilities, and to progress together with employees.
Employee Development
We are committed to building a management system covering the entire process of talent development by helping employees formulatepersonalised career development plans and providing them with clear career guidance and support for their growth. Moreover, we have establishedthree career development paths that focus on the category of management, technology and stores sta? respectively, to provide employees withdiversi?ed and personalised growth opportunities.We adhere to the principles of clarity, openness, and a combination of subjective and objective evaluation. Leveraging tools such as 360-degreeassessments and talent matrices, we continuously optimise the performance evaluation and talent selection processes, aiming to create a fair,transparent, accurate, and e?cient talent promotion mechanism. Additionally, we conduct quarterly, monthly, and annual performance evaluationscovering all employees of the headquarters and stores. In 2023, to support the Company's strategic goals, we systematically reviewed the quantityand quality of talents, conducted assessments for employees, among which the job competency rate was 70%, and the excellence rate was 30%.
Human Capital Management Tools
Employee Incentive
To fully motivate employees, we have established a performance-based remuneration system. In addition to basic wages, employees'remuneration includes quarterly/annual performance bonuses, excesspro?ts sharing, and special rewards for signi?cant contributions. At thesame time, we continue to improve long-term incentive mechanismsand implement equity incentives to attract and retain core talents. Wecontinue to grant restricted stocks to key management personnel andcore technical personnel. There are over 450 core talents have beenregistered for grants.
360-degree AssessmentTalent MatrixTo preliminarily evaluate employee's work performance basedon three dimensions, namely values, general managementcapabilities, and business capabilities.
To further evaluate employees around "capabilities + values"and "innovation performance" in 2-dimension matrices anddetermine the ?nal performance results, which will be includedinto employee promotion selection and long-term incentiveassessment.
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Employee Training
We have established a corporate university consisting of retailing colleges and businesscolleges , o?ering diversi?ed training courses for di?erent groups such as new employees,?rst-line employees, reserve talents, key technical personnel, newly promoted cadres, andcore management employees , to support employees in comprehensive growth. We adhereto the training concept that "a good corporate is a good university". Aiming at traininge?ectiveness, we ensure that training is interesting, useful and e?ective through "goodcourses", "good teachers" and "good training operation". "We have conducted 132 o?inetrainings in total, with the average o?ine training hours reaching 70 hours per employee.At the same time, we have organized online "daily learning" activities, which require ouremployees to spend 10-15 minutes per day on online learning to strengthen their professionalskills and career development potential."
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
o?ine trainings conducted in total
average o?ine training hours reachinghours per employee
We focus on professional talent cultivation and business empowerment. For this purpose, we have successfully established a multi-level trainingsystem covering management personnel, professionals, and stores sta? to improve employees' professional capabilities and service awareness. Inaddition, we continue to deepen cooperation with universities, and have jointly established several "Yifeng Classes", which adopt a dual-mentorand dual-location model (mentors from both the university and the Company to give lectures both on campus and at the Company's locations), tocultivate talents for the pharmaceutical and health industry and reserve excellent talent resources for Yifeng.
Training System
HeadquartersSta?Internal trainings for non-operational lines(general managers, department heads andemployees in the department)
Training camp for lecturers
(TTT training)
Reserve Cadres
ReserveCadresprogram
ReserveMinistersTrainingProgram
ManagementTalentsDevelopmentProgram(MDP)
Senior ManagementTalents DevelopmentProgram(SMDP)
ReserveMinisters
Ministersin o?ce
SeniorGeneralManagers
Talents Development Programs
We have established various new employee training programs such as the "Reserve Cadres Plan", "Yifeng Class" and "Yifeng Preparation Class,"and developed the New Employee Training Camp Growth Manual, to provide new employees with base training led by senior employees or seniormanagement personnel. In 2023, we completed 115 training sessions for new employees, with a total of 14,160 new employees participating. New Employee Training
We continuously improve the quali?cation supportprogramme to help employees obtain the professionalpharmacist quali?cation. We also cooperate with examinationinstitutions to help employees to register for exams andconduct mock exams to enhance their exam skills.
Professional Talent Training
We create development programmes for reserve talents, deputyministers, ministers in o?ce, and mid-to-senior managementaccording to di?erent job levels and functions, comprehensivelyenhancing the leadership and teamwork e?ciency of reserve talentsand management personnel. In 2023, we organised a total of 46training activities and 2 long-term learning classes, which adoptedboth online and o?ine training methods and combined theory andpractice to ensure the comprehensiveness and practicality of thetraining content. The training covered a total of 768 person-time.
Management Training
For the cultivation of full-time and part-time lecturers, we implement arigorous lecturer selection mechanism to ensure their professionalismand set up lecturer incentive schemes to motivate their enthusiasmand better empower employees. In 2023, we conducted 2 trainingsessions for internal lecturers. We completed the cultivation ofinstructors for new employee pre-service training and lecturers for theYifeng class.
Lecturer Team Building
We utilise online learning platforms and select lecturers who "haveability to give lectures and pro?ciency in teaching" to deliver high-quality training to franchised stores, and to ensure the trainees acquirecrucial knowledge and skills.
Franchisee Training
Special
Training
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
To build a learning organisation and continuously create a corporate culture with "growth and care", we take various e?orts to create an atmospherewhere employees are willing to learn and be devoted, and which embeds our cultural values of employee empowerment and growth, and warmthand care. We continuously improve the training and learning system, insist on conducting professional knowledge and corporate culture examsfor employees, to promote their continuous learning and growth. In 2023, we launched a total of 65 courses through online and o?ine channels,including 61 new courses, 2 updated courses, and 2 selected courses.In addition, our innovative projects focus the building of a learning-oriented organization, which enhance employees' professionalism and improveour talent development system.
ProgrammeParticipantsProgramme IntroductionTraining Results
Operation O?cerin the TrainingOrganization
Key employeesof second-leveldepartments
Provide systematically knowledge training andpractice to the training liaison personnel ofsecond-level departments. After the traineespass the training, they will serve as theoperation o?cer in the training organizationto prepare for the Company's comprehensivetraining.
It strengthens the connection betweenthe learning of "individuals", "teams"and "organizations" to enhance theirtraining e?ectiveness. A total of 33 trainingoperation o?cers have graduated from thisprogramme.
"Learning with Yifeng"Programme
Headquarter sta?
Provide comprehensive training and learningactivities for headquarter sta?, and create anopen, collaborative, and enjoyable trainingplatform that integrates high-quality learningresources from both the internal and externalsides for empowering employees.
It improves employees' job skills andcognitive levels. A total of 532 employeesparticipated in the programme.
"Negotiation Master"Training Camp andPK Competition
Procurement/Categorymanagers
Provide innovative teaching approaches withreal cases to enhance employees'negotiationskills, and improve their teamwork andadaptability.
It enhances the negotiation skills of relevantemployees and improves the e?ectivenessof negotiations. A total of 22 traineeshave successfully graduated from thisprogramme.Innovative Training Programmes
In 2023, we initiated a development programme for importantreserve management talents - the "Yifeng Reserve CadresPlan". The programme members have academic backgroundsin medicine and pharmacy from top-tier universities and adopta mixed training approach integrating centralised face-to-face teaching, online learning, on-job training, and coachingby mentors, to ensure that each reserve management talentreceives targeted career planning, professional training,and cultural guidance, signi?cantly enhancing the traininge?ectiveness and meeting the Company's urgent demand forreserve management talents. By the end of 2023, our "YifengReserve Cadres Plan" had cultivated 2,244 talents, with 131 keytalents occupying core positions in the Company.
"Yifeng Reserve Cadres Plan": CultivateReserve Forces for Future Development
"Yifeng Reserve Cadres Plan" Training Program
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
DemocraticManagementWe strengthen democratic management and establish smoothcommunication mechanisms for employees to address theirreasonable demands and safeguard their legitimate rights andinterests. Our trade union covers and serves all employees.We listen to employees' voice, by establishing a direct line to approachthe President, implementing the "Approaching our Employees"system, and conducting satisfaction surveys, to create a goodcommunication environment for employees. In 2023, we organisedemployee satisfaction surveys for their dormitories and canteens,conducted in-depth analysis of the survey results, and formulated andimplemented improvement measures accordingly.
Care for Employees
We provide thoughtful bene?ts and conduct a variety of activities to enhance employee's sense of belonging and satisfaction.We o?er a diverse range of bene?ts for all employees, including statutory bene?ts as well as supplementary and special bene?ts.
Statutory Bene?ts
SpecialBene?ts
Others
Supplementary Bene?ts
Statutory holidays, the ?ve insurances (pensioninsurance, medical insurance, unemploymentinsurance, work-related injury insurance andmaternity insurance), and housing fund"Yi" Fund, childcare leave, greetings inInternational Women's Day, retirementceremonies
Bene?ts for employees' Birthday, Mid-AutumnFestival, Dragon Boat Festival, employeedormitories, employee canteens, psychologicalcounselling, health check-upsRetirement bene?ts, pensions and so on
Being committed to the concept of work-life balance, we encourage employees to actively participate in various club and team-building activitiesto help them relieve work pressure, and enhance communication and cooperation among colleagues. Meanwhile, the Company providescomprehensive sports facilities such as ?tness equipment, badminton courts, and basketball courts to promote a healthy lifestyle. In 2023, weconducted cultural activities such as "Yi Wisdom Pioneer" "Health Exercise for All" and "Music Festival for All" with a total of over 53,000 participants.Yifeng Pharmacy upholds and promotes the spirit to "treat employees well, promote unity and mutual assistance, help those in need". We haveestablished a Yifeng Mutual Assistance Foundation ("Yi" Fund), which employees can choose to participate in. The fund aims to help employeesin need and their families and promote a team culture that fosters mutual help and assistance. Since its establishment, "Yi" Fund has providedsupports to over 300 employees or their family members, with total assistance exceeding RMB 4 million.
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Mental HealthWe actively care for employees' mental health by conducting mentalhealth assessments, holding mental health lectures and providecounselling for them to safeguard their physical and mental well-being. In 2023, we organised 2 mental health lectures, conductedmental health assessments for 27,015 employees, and we activelyhelp employees relieve their psychological pressure according totheir assessment results. A total of 142 employees participated inpsychological consultation return visits.
In 2023, we set up an EAP "Employee Assistance Programme(Psychology)" project team to provide employees with a full rangeof mental health services such as mental health check-ups, freepsychological counselling, and mental health lectures, in order tosafeguard the mental health of employees.
Employee Mental Health Programmeof Yifeng Pharmacy
In October 2023 we held the "Employee Skills for Coping withPsychological Stress " mental health lecture. In this lecture,Professor Tang Haibo from Central South University was speciallyinvited to promote the sources of stress to all employees, teachthe ways to cope with pressure, help employees master practicalskills to unwind themselves, enhance their mental healthawareness, and improve their psychological quality.
"Workplace Psychological Stressand Coping Skills" Lecture
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Occupational Health and SafetyWe strictly comply with the laws and regulations such as the Law of the People's Republic of China on Work Safety, the Law of the People's Republicof China on the Prevention and Control of Occupational Diseases, and the Emergency Response Law of the People's Republic of China, and haveformulated normative documents such as the Yifeng Pharmacy Safety Management Policy and the Yifeng Pharmacy Fire Prevention and TheftPrevention Policy, to continuously strengthen daily safety prevention and management, and fully safeguard the health and safety of employees.
Safety ManagementAccording to the Safety Management Policy, the Company comprehensively strengthens and deepens safety management, implements key safetymanagement measures, and enhances the safety management and emergency response capabilities of all employees to e?ectively guaranteesemployees' occupational safety.
Emergency Drills
Work-related InjuryManagementTo strengthen employees' awareness of ?re safety andimprove their ability to respond to emergencies such as ?res,the Company organises two large-scale ?re drills every year.The drill mainly includes ?re evacuation drill and the use of?re extinguishers, comprehensively enhancing employees'awareness of ?re safety.
The Company has formulated the Work-related InjuryReporting Process, and developed response measures. Westrengthened prevention and supervision, to reduce theincidence of work-related injuries, ensuring the safety andphysical health of employees.
Safety Culture Building
The Company actively promotes safety culture and takes e?ectivemeasures to improve employees' emergency response capabilitiesand accident prevention capabilities. In 2023, we conducted severalhealth promotion activities and safety trainings.
The Company actively promotes the concept of a healthylifestyle and practices the "Anti-smoking Culture". We requireall employees to sign a "Smoking Control Commitment",which clearly de?nes the responsibility and obligation todiscourage smoking. We also strengthen publicity for controllingsmoking and relevant knowledge, thereby creating a smoke-freeenvironment that is conducive to health and etiquette .
In 2023, the Company collaborated with the Workers' Healthand Safety Education Centre of Hunan Province to conduct ahealth and safety lecture for all employees. During the lecture,experts elaborated on the knowledge about the preventionand treatment of basic diseases, immunity enhancement andknowledge of the ?rst aid in Cardiac Pulmonary Resuscitation(CPR). The lecture not only improved employees' awareness ofhealth and safety, but also equipped them with practical healthknowledge and ?rst aid skills.
Yifeng Collaborates with Professional Institutionsto Enhance Awareness towards Health and Safety
Promoting a Smoke-freeCulture for A Healthy Lifestyle
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Practising Green Conceptsto Co-create a FriendlyEnvironment
"
"
Facing challenges such as environmentaldegradation, resource scarcity, and extreme weather,Yifeng Pharmacy integrates the green developmentconcept and strategy into business activities bypromoting environmental protection, strengtheningresource management and addressing climatechange. The Company also actively explores a green,low-carbon and high-quality development path,and appropriately handles the relationship betweenecological environmental protection and corporatedevelopment, aiming to create an environmentallyfriendly company.
DeepeningEnvironmentalManagement
Yifeng Pharmacy strictly abides by the Environmental Protection Lawof the People's Republic of China, the Water Pollution Preventionand Control Law of the People's Republic of China, the AtmosphericPollution Prevention and Control Law of the People's Republic ofChina, the Law of the People's Republic of China on Prevention andControl of Environmental Pollution by Solid Waste, the Soil PollutionPrevention and Control Law of the People's Republic of China andother environmental laws and regulations. Based on our developmentstrategies and plans, the Company has set objectives for internalenvironmental management and formulated a number of institutionalnorms and management initiatives to establish a holistic system ofenvironmental management to continuously increase the capacity forenvironmental protection. In 2023, we were not subject to administrativepenalties for violations of environmental laws and regulations.To e?ectively implement the environmental management system, wehave set the environmental management objectives with a focus onthe key sectors in?uential to the environment, and carried out andmonitored the relevant environmental management measures.
O?ce：Set up annual goals for water and electricity saving
Green Operation
Logistics：Increase the use of new energy vehiclesDistribution and warehouse：Expand coverage of photovoltaicpower projects
Climate Change
Environmental Management Goals
Optimising Resource ManagementYifeng Pharmacy practices the concepts of energy conservation and environmental protection, striving for an all-round and systematic managementin energy management, water management and emission management. We pursue the e?cient use of resources, emphasise the recycling ofmaterials and focus on the management of three-waste emissions to reduce the negative impact of our operations on the environment.
Energy ManagementIn strict accordance with the Law of the People's Republic of China on Energy Conservation and the Regulation on Energy Conservation inCivil Buildings, we have stipulated the Yifeng Pharmacy Measures for the Management of Water and Electricity Fees and the Yifeng PharmacyManagement Policy for the Use of Air-conditioning at the Headquarters Park. Accordingly, we enhance our philosophy of green transition byapplying energy-saving equipment, promoting green operation initiatives, and steadily pushing forward photovoltaic power generation projects. In2023, we made a thorough e?orts to upgrade the energy-e?cient lighting, with a total investment of RMB 500,000.
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Green land transport： we continue to promote the use of new energy vehicles and the replacement of fuel vehicles,
and improve the proportion of new energy vehicle capacity. By the end of 2023, the proportion of new energy vehiclecapacity in core urban areas reached 100%, and that of other urban areas was 50%. The use of new energy vehiclesin third-party logistics and distribution reached over 60%. In 2023, Yifeng Pharmacy reduced GHG emissions byapproximately 236 tCO
e through green land transport.Photovoltaic power：we spend more e?orts in the photovoltaic construction to increase the proportion of cleanenergy utilization. Since Jiangxi Yifeng Pharmaceutical Industrial Park completed the construction of the ?rstdistributed photovoltaic power generation project, by the end of 2023, the total power generation reached 780thousand kWh, equivalent to a reduction in GHG emissions of about 467 tCO
e.Water-loop heat pump：We use water-loop heat pump air-conditioning systems to heat and cool buildings byutilising low-level heat sources.Smart lighting：By the end of 2023, Yifeng Pharmacy comprehensively applied the auto-sensing control system,saving 1.2 million kWh of electricity, equivalent to a reduction in GHG emissions of about 684 tCO
e.
Logistics Centre
Air-conditioning：we strictly control the time for switch-on and switch-o? and temperature settings, and adopt coolstorage air-conditioning system to actualize a balance in comfortability and energy conservation.Smart lighting：we use LED lights in an integrated way, and use an intelligent control system to automatically adjustthe brightness of the light source according to the scene and environment to improve energy e?ciency. By the end of2023, the smart lighting system achieved a 34% power saving per store.Green decoration：we actively use environmentally friendly integrated wall coverings for our store ?t-outs, whosegood thermal and insulation properties e?ectively reduce energy consumption. In 2023, several new stores weredecorated with environmentally friendly materials.O?ces and Stores
The Photovoltaic Power Generation Project in Jiangxi Yifeng
Pharmaceutical Industrial Park
Driven by the national Carbon Peaking and Carbon Neutralitygoals and global energy transition, Yifeng Pharmacy haslaunched the ?rst distributed photovoltaic power generationproject in Jiangxi Yifeng Pharmaceutical Industrial Park toembrace the opportunities brought by the green developmentand respond to the relevant challenges. After the completionof the project, the park is expected to improve the level ofgreen energy use through photovoltaic power generation. Theinstallation of photovoltaic power stations on the roof can alsoe?ectively insulate the roof and reduce the energy consumptionof air conditioning, thus achieving a variety of energy-savinge?ects.
Transition towards Green Operation by SeizingOpportunities of Green DevelopmentThe key measures of energy management are listed below:
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Our energy consumption of each category and the total energy consumption intensity are shown in the tablebelow:
Energy Consumption
Unit2023Total energy consumptiontce19,922.96Energy consumption intensitytce / ten million RMB0.88Non-renewable fuel (direct)consumption
tce468.47Natural gastce28.41Petroltce314.20Dieseltce125.87Renewable fuel (direct)consumption
tce100.60Photovoltaic power generationtce100.60Indirect energy consumptiontce19,353.89Electricitytce 19,353.89
Water ManagementWe strictly follow the Water Law of the People's Republic of China and other laws and regulations. Weadvocate scienti?c and rational water use, promote water conservation regulations, and comprehensivelyimprove the e?ciency of water use to achieve sustainable use of water resources. We operate in China, andall of our sites are supplied with water from the municipal network, so there are no di?culties in obtainingwater.The key measures of water resources management are listed below:
The total water consumption and intensity are shown in the table below:
Water ConsumptionUnit2023
Total water consumptionCubic meter589,084.24Water consumption intensityCubic meter / million RMB26.08
We put up eye-catching water-saving signs in each water usingarea as a reminder to employees.
Water-saving Sign
We use water-saving taps toimprove water e?ciency bycontrolling the ?ow of water.
Water-saving Equipment
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
The energy consumption conversion coe?cients are determined with reference to the conversion coe?cients provided by the the GeneralRules for Calculation of Comprehensive Energy Consumption (GB/T2589-2020) of China.
Material Use and Three-Waste ManagementWe continue to explore green elements in the ?eld of green operations and actively promote low-carbon and environmentally friendly work and lifestyles to create a low-carbon o?ce and operating environment with our employees. We strictly abide by the Law of the People's Republic of China onthe Prevention and Control of Atmospheric Pollution and the Law of the People's Republic of China on Prevention and Control of Water Pollution, andare committed to pollution prevention and waste management. During the manufacturing and operation processes, we mainly discharge domesticwastewater and exhaust gases and generate pharmaceutical products discarded due to breakage or expiry, o?ce paper and discarded pharmaceuticalpackaging materials. There are no highly hazardous or polluting conditions in our production and operational activities. In 2023, we had no signi?cantdischarge or leakage violations.The key measures of the three-waste management are listed below:
? We use integrated wall coverings to decorate stores to reducethe release of formaldehyde and other harmful substances.? We actively promote the use of new energy vehicles andcontrol tailpipe emissions to reduce air pollution.
Waste Gas
? We install water-saving taps and turn them o? frequently to
eliminate long runs.
Wastewater
? We dispose of near-expiry and expired medications on a monthly basis in accordance with the hazardous chemical supply process.? Paper recycling bins are set up next to printers to collect and utilise reusable paper. We advocate for black and white double-sidedprinting, and use single-sided waste paper to print informal documents.? We promote using personal water bottles to reduce the use of disposable cups.? We are committed to maximising the use of resources and do not purchase cartons externally. We reuse packaging cartons frompharmaceutical suppliers wherever possible and strongly promote recycling rates for plastic crates. By the end of 2023, the recyclingrate of pharmaceutical cartons and plastic crates was 60% and 100%, respectively.
Solid Waste
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
The exhaust emissions and intensity are shown in the table below.Exhaust emissions
Unit2023
Total exhaust emissionsKilogram2,668.71Exhaust emission intensityKilogram / million RMB0.12Nitrogen oxides (NOx)Kilogram2,442.13Sulfur oxides (SOx)Kilogram5.70Particular matters (PM)Kilogram220.88The solid wastes discharge and intensity are shown in the table below.Waste DischargeUnit2023
Hazardous wasteTonne185.83Hazardous waste intensityTonne / million RMB0.0082Non-hazardous wasteTonne6.98Non-hazardous waste intensityTonne / million RMB0.0003
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironmentThe materials usage is shown in the table below.
Materials usageUnit2023
Materials usageTonne1,002.35Plastic containersTonne583.97Plastic palletTonne418.38
The exhaust emissions conversion coe?cients are determined with reference to the Emission Coe?cients and Material Accounting Methods for Industries not Covered by Emission Permits (Trial) issued by the Ministry of Ecology and Environment.
Addressing Climate ChangeClimate change is one of the most serious challenges confronted by mankind today as global warming continues to deteriorate. The frequentoccurrences of extreme weather triggered by climate change impose many negative impacts on business operations, including disruptions to powerand water supply systems, delays in transport, and damage to goods.Yifeng Pharmacy, a responsible pharmaceutical retailing chain enterprise, is well aware of the importance of a stable supply of medicines inthe health and safety of customers' lives, and takes the identi?cation and management of climate risk as an important task in the company'ssustainable operation, and actively responds to climate change. In 2023, we took the following measures to deal with extreme weather:
Adjusting logistics routes
When confronted with extreme weather, we adjust thelogistics routes in time, and choose a safer route to avoiddelays.
Reserving emergency suppliesWe keep a su?cient amount of emergency suppliesto ensure that when extreme weather occurs, we canreplenish supplies in time to avoid shutdowns anddiscontinued production.
Enhancing preventive maintenanceWe regularly conduct preventive maintenance toward thesupply chain, thus ensuring the safety and stability of themedication supply chain under the extreme weather.
Conduct training for employeesEmployees gain insights of how destructive extreme weathercan be through attending trainings and drills where theyalso learn how to respond to extreme weather. Thus, theCompany improves their abilities to deal with emergenciesin extreme weather and safeguards the employees' safety.
Strengthening cooperation with suppliers
To cope with possible shutdowns and discontinued production, we keep abreast of our suppliers' operations by establishing closerelationships with them and take appropriate measures, such as ?nding alternative suppliers and adjusting procurement plans.
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
We proactively grasp the opportunities presented by climatechange and seek innovations in pharmaceutical accessibility, digitaltransformation, supply chain management and circular economy torespond to stakeholders' concerns about climate-related issues. Weare committed to being the backbone of society's health by ensuringthe supply of medicines in extreme weather, improving operationale?ciency in extreme weather, enhancing the climate resilience of oursupply chain and promoting the green and low-carbon developmentof our operations.Emissions and intensity of greenhouse gases by category are shown inthe table below.Greenhouse gasesemissions
Unit2023
Total Greenhouse gasesemissions
Tonne CO
e90,868.61Greenhouse gasesemissions intensity
Tonne CO
e /million RMB
4.02
Greenhouse gasesemissions（Scope 1)
Tonne CO
e1,059.64Greenhouse gasesemissions（Scope 2)
Tonne CO
e89,808.97
The consolidation method for GHG emissions is based on the operational control method, inwhich we account for GHG emissions from operations over which the company or a subsidiaryhas operational control.
Scope 1 GHG emissions are mainly from direct GHG emissions resulting from theconsumption of fossil fuels in the Company's operations and production processes, includingnatural gas, petrol, diesel. The greenhouse gas emissions coe?cients are determined withreference to Guidelines for Accounting and Reporting of Greenhouse Gas Emissions for PublicBuilding Operating Units (Enterprises) (Trial).
Scope 2 GHG emissions are mainly from indirect GHG emissions from purchased electricityfrom the Company's operations and production processes. The greenhouse gas emissioncoe?cient of purchased electricity was 0.5703 tCO
/MWh, which is the average emissionfactor for the national power grid determined with reference to the Notice on the Managementof GHG Emissions Reporting for Power Generation Sector from 2023 to 2025 issued by theMinistry of Ecology and Environment.
Appendix: GRI Standards and SSE Sustainability ReportingGuidelines Content TableYifeng Pharmacy discloses the information quoted in the index below for the year 2023 with reference to the GRI Standards and the SSE Sustainability Reporting Guidelines.
GRI StandardsDisclosuresSSE Sustainability
Reporting Guidelines
LocationGeneral DisclosureThe organisation and its reporting practices
GRI 2: General Disclosures 2021
2-1 Organizational detailsAbout Us2-2 Entities included in the organization'ssustainability reporting
Chapter I Article 4
Scope of this Report2-3 Reporting period, frequency and contact point
Scope of this Report
Accessibility and Contact2-4 Restatements of informationChapter I Article 6 Information of the ReportActivities and workers
GRI 2: General Disclosures 2021
2-6 Activities, value chain and other businessrelationships
About Us2-7 Employees Chapter IV Article 50
About Us
Compliant Employment2-8 Workers who are not employeesCompliant EmploymentGovernanceGRI 2: General Disclosures 20212-9 Governance structure and compositioncChapter II Article 12Corporate Governance
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
GRI StandardsDisclosuresSSE Sustainability
Reporting Guidelines
Location
Governance
GRI 2: General Disclosures 2021
2-10 Nomination and selection of the highestgovernance body
Corporate Governance2-11 Chair of the highest governance body Corporate Governance2-12 Role of the highest governance body inoverseeing the management of impacts
Chapter I Article 9
ESG Management2-13 Delegation of responsibility for managingimpacts
ESG Management2-14 Role of the highest governance body insustainability reporting
ESG Governance2-16 Communication of critical concerns Stakeholder Communication2-17 Collective knowledge of the highestgovernance body
ESG Management2-19 Remuneration policies Chapter I Article 9Corporate Governance2-20 Process to determine remuneration Corporate GovernanceStrategy, policies and practicesGRI 2: General Disclosures 2021
2-22 Statement on sustainable developmentstrategy
Message from the ChairmanESG Management
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
GRI StandardsDisclosuresSSE Sustainability
Reporting Guidelines
LocationStrategies, policies and practices
GRI 2: General Disclosures 2021
2-25 Processes to remediate negative impacts Compliance in Operation2-27 Compliance with laws and regulations Chapter III Article 30, 33
We strictly comply with the applicable
laws and regulations of the regions and
countries in which we operate.2-28 Membership associationsHonours and RecognitionStakeholder engagementGRI 2: General Disclosures 20212-29 Approach to stakeholder engagementChapter I Article 9Stakeholder CommunicationMaterial topicsGRI 3: Material Topics 2021
3-1 Process to determine material topics
Chapter I Article 5
Management of Material Issues3-2 List of material topicsManagement of Material IssuesEconomic performanceGRI 201: Economic Performance 2016
201-2 Financial implications and other risks andopportunities due to climate change
Chapter III Articles 22, 23Addressing Climate Change201-3 De?ned bene?t plan obligations and otherretirement plans
Care for EmployeesMarket presenceGRI 3: Material Topics 20213-3 Management of material topicsCompliant EmploymentGRI 202: Market Presence 2016
202-2 Proportion of senior management hiredfrom the local community
Compliant Employment
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
GRI StandardsDisclosuresSSE Sustainability
Reporting Guidelines
LocationIndirect economic impactsGRI 3: Material Topics 20213-3 Management of material topicsCare for People's Well-beingGRI 203：Indirect Economic Impacts 2016203-2 Signi?cant indirect economic impactsCare for People's Well-beingProcurement practicesGRI 3: Material Topics 20213-3 Management of material topicsChapter IV Article 46
Strategy of Controllable High-quality
MedicinesAnti-corruptionGRI 3: Material Topics 20213-3 Management of material topicsCompliance in Operation
GRI 205: Anti-corruption 2016
205-1 Operations assessed for risks related tocorruption
Chapter V Article 55
Compliance in Operation205-2 Communication and training about anti-corruption policies and procedures
Compliance in Operation205-3 Con?rmed incidents of corruption andactions taken
Compliance in OperationAnti-competitive BehaviorGRI 3: Material Topics 20213-3 Management of material topicsCompliance in OperationGRI 206: Anti-competitive Behavior 2016
206-1 Legal actions for anti-competitive behavior,anti-trust, and monopoly practices
Chapter V Article 56Compliance in Operation
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
GRI StandardsDisclosuresSSE Sustainability
Reporting Guidelines
LocationMaterialsGRI 3: Material Topics 20213-3 Management of material topicsOptimising Resource Management
GRI 301: Materials 2016
301-1 Materials used by weight or volume
Chapter III Articles 56, 37
Optimising Resource Management301-2 Recycled input materials usedOptimising Resource Management301-3 Reclaimed products and their packagingmaterials
Optimising Resource ManagementEnergyGRI 3: Material Topics 20213-3 Management of material topicsOptimising Resource Management
GRI 302: Energy 2016
302-1 Energy consumption within theorganization
Chapter III Articles 20, 35
Optimising Resource Management302-2 Energy consumption outside of theorganization
Optimising Resource Management302-3 Energy intensityOptimising Resource Management302-4 Reduction of energy consumptionOptimising Resource Management302-5 Reductions in energy requirements ofproducts and services
Optimising Resource ManagementWater and e?uentsGRI 3: Material Topics 20213-3 Management of material topicsOptimising Resource Management
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
GRI StandardsDisclosuresSSE Sustainability
Reporting Guidelines
Location
GRI 303: Water and E?uents 2018
303-1 Interactions with water as a shared resource
Chapter III Articles 30, 36
Optimising Resource Management303-2 Management of water discharge-relatedimpacts
Optimising Resource Management303-3 Water withdrawalOptimising Resource Management303-4 Water dischargeOptimising Resource Management303-5 Water consumptionOptimising Resource ManagementBiodiversity
GRI 3: Material Topics 20213-3 Management of material topics
During the reporting period, the Company's
activities, products and services did not
have a signi?cant impact on biodiversity.
GRI 304: Biodiversity 2016
304-1 Operational sites owned, leased, managedin, or adjacent to, protected areas and areas ofhigh biodiversity value outside protected areas
Chapter III Article 32
During the reporting period, the Company
had no operational sites owned, leased,
managed in, or adjacent to, protected
areas and areas of high biodiversity value
outside protected areas.304-2 Signi?cant impacts of activities, productsand services on biodiversity
During the reporting period, the Company's
activities, products and services did not
have a signi?cant impact on biodiversity.304-3 Habitats protected or restored
During the reporting period, the Company's
operations did not involve protected or
restored habitats.304-4 IUCN Red List species and nationalconservation list species with habitats in areasa?ected by operations
During the reporting period, there were no
species on the IUCN Red List and national
conservation list in the habitats a?ected by
the Company's operations.
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
GRI StandardsDisclosuresSSE Sustainability
Reporting Guidelines
LocationEmissionsGRI 3: Material Topics 20213-3 Management of material topicsAddressing Climate Change
GRI 305: Emissions 2016
305-1 Direct (Scope 1) GHG emissions
Chapter III Articles 24, 25,26, 27, 30
Addressing Climate Change305-2 Energy indirect (Scope 2) GHG emissionsAddressing Climate Change305-3 Other indirect (Scope 3) GHG emissionsAddressing Climate Change305-4 GHG emissions intensityAddressing Climate Change305-5 Reduction of GHG emissionsOptimising Resource Management305-7 Nitrogen oxides (NOx), sulfur oxides (SOx),and other signi?cant air emissions
Optimising Resource ManagementWaste
GRI 3: Material Topics 20213-3 Management of material topicsOptimising Resource Management
GRI 306: Waste 2020
306-1 Waste generation and signi?cant waste-related impacts
Optimising Resource Management306-2 Management of signi?cant waste-relatedimpacts
Optimising Resource Management306-3 Waste generatedChapter III Article 31Optimising Resource Management
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
GRI StandardsDisclosuresSSE Sustainability
Reporting Guidelines
LocationWasteGRI 306: Waste 2020
306-4 Waste diverted from disposal
Chapter III Articles 31, 37
Optimising Resource Management306-5 Waste directed to disposalOptimising Resource Management
Supplier environmental assessmentGRI 3: Material Topics 20213-3 Management of cmaterial topics
Strategy of Controllable High-quality
MedicinesGRI 308: Supplier EnvironmentalAssessment 2016
308-2 Negative environmental impacts in thesupply chain and actions taken
Chapter IV Article 45
Strategy of Controllable High-quality
MedicinesEmploymentGRI 3: Material Topics 20213-3 Management of material topicsCare for Employees
GRI 401: Employment 2016
401-2 Bene?ts provided to full-time employeesthat are not provided to temporary or part-timeemployees
Care for Employees401-3 Parental leaveCare for EmployeesLabour/management relationsGRI 3: Material Topics 20213-3 Management of material topics Compliant Employment
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
GRI StandardsDisclosuresSSE Sustainability
Reporting Guidelines
Location
Occupational health and safetyGRI 3: Material Topics 20213-3 Management of material topicsOccupational Health and Safety
GRI 403: Occupational health and safety2018
403-3 Occupational health services
Chapter IV Article 50
Occupational Health and SafetyCare for Employees
403-5 Worker training on occupational health andsafety
Occupational Health and Safety403-6 Promotion of worker health
Occupational Health and Safety
Care for Employees403-9 Work-related injuriesOccupational Health and Safety403-10 Work-related ill healthOccupational Health and SafetyTraining and education
GRI 3: Material Topics 20213-3 Management of material topicsTalent DevelopmentGRI 404: Training and Education 2016
404-1 Average hours of training per year peremployee
Chapter IV Article 50
Talent Development404-2 Programs for upgrading employee skills andtransition assistance programs
Talent Development
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
GRI StandardsDisclosuresSSE Sustainability
Reporting Guidelines
Location
Training and educationGRI 404: Training and Education 2016
404-3 Percentage of employees receiving regularperformance and career development reviews
Chapter IV Article 50Talent DevelopmentDiversity and equal opportunityGRI 3: Material Topics 20213-3 Management of material topicsCompliant Employment
GRI 405: Diversity and Equal Opportunity2016
405-1 Diversity of governance bodies andemployees
Corporate GovernanceCompliant EmploymentNon-discriminationGRI 3: Material Topics 20213-3 Management of material topicsCompliant Employment
GRI 406: Non-discrimination 2016
406-1 Incidents of discrimination and correctiveactions taken
Compliant EmploymentChild labourGRI 3: Material Topics 20213-3 Management of material topicsCompliant EmploymentGRI 408: Child Labor 2016
408-1 Operations and suppliers at signi?cant riskfor incidents of child labour
Compliant EmploymentForced or compulsory labourGRI 3: Material Topics 20213-3 Management of material topicsCompliant Employment
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
GRI StandardsDisclosuresSSE Sustainability
Reporting Guidelines
Location
Forced or compulsory labourGRI 409: Forced or Compulsory Labor 2016
409-1 Operations and suppliers at signi?cant riskfor incidents of forced or compulsory labour
Compliant EmploymentSupplier social assessmentGRI 3: Material Topics 20213-3 Management of material topics
Strategy of Controllable High-quality
MedicinesGRI 414: Supplier Social Assessment 2016
414-2 Negative social impacts in the supply chainand actions taken
Chapter IV Article 45
Strategy of Controllable High-quality
MedicinesCustomer health and safetyGRI 3: Material Topics 20213-3 Management of material topics
Strategy of Controllable High-quality
MedicinesGRI 416: Customer Health and Safety 2016
416-1 Assessment of the health and safetyimpacts of product and service categories
Strategy of Controllable High-quality
MedicinesMarketing and labelingGRI 3: Material Topics 20213-3 Management of material topicsCare for People's Well-beingGRI 417: Marketing and Labeling 2016
417-1 Requirements for product and serviceinformation and labeling
Care for People's Well-beingCustomer privacy
GRI 3: Material Topics 20213-3 Management of material topicsInformation Security and Privacy
GRI 418: Customer Privacy 2016
418-1 Substantiated complaints concerningbreaches of customer privacy and losses ofcustomer data
Chapter IV Article 48Information Security and Privacy
Consolidating the Foundation ofGovernance and Adhering to theBottom Line of Responsibility
Focusing on Selective Retailing forPeople's Well-being
Empowering HealthcareAccessibility and SafeguardingPublic Health
Cultivating a Professional Teamand Realising the Value of Talents
Practising Green Conceptsto Co-create a FriendlyEnvironment
Yifeng Pharmacy Chain Co., Ltd.Address: Yifeng Pharmaceutical Park, No. 68 JinzhouAvenue, Lugu Hi-Tech Zone, Changsha, Hunan, ChinaInvestor Email: ir@yfdyf.comCompany Website: https://www.yfdyf.cn