Muyuan Foods Co., Ltd.2023 Environmental, Social, & Governance Report
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Muyuan Foods Co., Ltd. 2023 Environmental, Social, & Governance Report
Muyuan Foods Co., Ltd. (hereinafter referred to as "Muyuan", "Muyuan Foods", "the Company" or "we") hereby issues the 2023Environmental, Social, and Governance (ESG) Report. Adhering to the corporate core value of "Creating Value, Serving Society",we fully implement the United Nations' Sustainable Development Goals (SDGs), demonstrating our re?ections and actions onsustainable development management. This report aims to respond to the expectations and concerns of our stakeholders andfacilitate better communication with them.
About the Report
Unless otherwise stated, the disclosure scope of this report aligns with the scope of Muyuan's 2023 annual report, includingMuyuan and its subsidiaries. The coverage period is from January 1, 2023 to December 31, 2023, with some descriptions extendingbeyond this period. This report is disclosed on an annual basis.Report Scope
The Report is prepared to meet applicable standards for disclosing sustainable development information, with considerationof the industry background and features of the Company. Key references for this report include the following domestic andinternational CSR reporting standards and guidelines:
The Sustainability Reporting Standards of the Global Reporting Initiative (GRI Standards 2021)issued by the Global SustainabilityStandards Board (GSSB)IFRS Sustainability Standards No.1-General Requirements for Disclosure of Sustainability-related Financial Information (IFRS S1)andIFRS Sustainability Standards No.2-Climate-related Disclosures (IFRS S2)issued by the International Sustainability StandardsBoard (ISSB)Self-Regulatory Supervision Guide for Listed Companies on the Shenzhen Stock Exchange No.1-Main Board Listed CompaniesStandardized OperationShenzhen Stock Exchange Self-Discipline Regulatory Guidelines for Listed Companies No.1-Business HandlingGuidelines on Formulation of Social Responsibility Reports (GB/T 36001-2015)The ISO 26000: Guidance on Social Responsibility issued by the International Organization for Standardization (ISO)The Guidelines on Corporate Social Responsibility Reporting for Chinese Enterprises (CASS ESG5.0)issued by Chinese Academyof Social Sciences (CASS)
Reference Standards
The report's data is all extracted from internally collected data, public documents, sustainable development cases reported bysubsidiaries and qualitative and quantitative questionnaires prepared for reporting.Notes to the Report's Data
The report is available in both print and electronic form. The online versions could be read and downloaded on CNINFO (www.cninfo.com.cn), a website accredited by China Securities Regulatory Commission ("CSRC") for information disclosure of listedcompanies, and the Company's website (www.muyuanfoods.com).Availability
This report is available in both Simpli?ed Chinese and English. In case of any discrepancies in interpretation, please refer to theSimpli?ed Chinese version of the report.Language Versions
Unless otherwise speci?ed, all monetary amounts quoted in the Report are presented in yuan ("CNY").
Currency
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Muyuan Foods Co., Ltd. 2023 Environmental, Social, & Governance Report
ContentsAbout the ReportMessage from the Chairman
02 2023 ESG HighlightPerformance
01 About Muyuan007Corporate CultureCorporate OverviewOperational PerformanceESG MilestonesAnnual Awards and Recognition
03 SustainableCorporate Governance
Corporate GovernanceESG ManagementRisk ManagementBusiness EthicsInnovative Development
04 EnvironmentallyFriendly Development
Low-carbon ActionsGreen ProductionSustainable AgricultureEcological Restorationand Biodiversity Conservation
05 PragmaticResponsibility Assumption
Product QualityHappy EmployeesSustainable Supply ChainCommunity DevelopmentIndustry Sharing
Future Prospects109
Appendix111Muyuan's ESG Key PerformanceGRI IndexReader Feedback Form
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Muyuan Foods Co., Ltd. 2023 Environmental, Social, & Governance Report
2023 was a year full of challenges and opportunities. Newtechnologies such as digitalization, arti?cial intelligence, newenergy, and synthetic biology continued to iterate, bringingenormous innovation space, and various industries enteredthe stage of high-quality development.Muyuan people remain true to our original aspirations, alwaysadhering to the core values of "Creating Value, Serving Society."We seek breakthroughs at the front line of the business, persistin technological innovation and continuously improve thegovernance system so as to promote high-quality development,manage uncertainty with certainty, adhere to innovation-driven development, and jointly create a better future.
Message fromthe Chairman
Environmental protection is the priority of high-qualitydevelopment. Adhering to the principles of "production withwaste reduction, resource utilization, harmless treatment,and ecological recycling," Muyuan sets five environmentalprotection goals of "zero emissions, no hidden dangers, noodors, smog reduction, and carbon emission reduction" topromote crop-livestock cycle, develop and utilize new greenenergy, reduce energy consumption, and achieve green andsustainable development.Since 2000, Muyuan has been implementing low-soybeanmeal diet technology and shared it with the industry in 2021.In 2023, Muyuan's soybean meal consumption decreasedby 1.6% compared to 7.3% in 2022, less than half of theindustry's average consumption. If this technology is promotednationwide, it can reduce 20 million tons of soybean imports,save 150 million mu(10 million hm?) of land, and reducenitrogen emissions by 820,000 tons.Through environmental protection technology innovation,Muyuan has achieved crop-livestock cycle and resourceutilization. By innovating the new pig house with air ?ltration,the air consumption has been reduced by two-thirds, the airis deodorized and sterilized before discharge, and odorlesstreatment and harmonious development are achieved withoutdisturbing the public. Moreover, by conducting low-carbonactions, our carbon emission intensity has reduced by 3.4%compared to last year.
Seek Green Development andSet New Standards
Chairman：
Adhering to the principle of "benefiting the locality wherewe are", Muyuan actively assist and bene?t farmers, supporteducation development and etc. We promote crop-livestockcycle and try to help farmers increase their income. Eachfarm is an ecological circular economy entity, promotingthe resource utilization of manure and assisting farmers inreducing costs and increasing efficiency. In 2023, Muyuanserved 4.52 million mu(301,333hm?) of farmland, improved229,500 mu(15,300hm?) of saline-alkali land, managed 88,000mu(5,867hm?) of desert, conducted agricultural technologyservices 9,759 times, trained 298,300 farmers, reduced fertilizerusage by 146,800 tons, increased farmers' income by 352.27yuan/mu, and achieved a total income increase of 1.482 billionyuan. Over the past six years, Muyuan has cumulativelyreduced agricultural input and increased income by 4.472billion yuan.Nurturing a stellar university student can kindle a family, sowseeds of hope, pave the path to a brighter future, and fostersocietal prosperity. Muyuan continues to carry out the Ju'aiEducation Assistance Project, with a total donation of 365million yuan, supporting 82,000 college students, benefiting626,000 elementary school students, rewarding 26,000outstanding teachers, so as to support the development ofeducation.
Assist Farmers andPromote Common Development
Muyuan's development history is a history of innovation.Focusing on the main business, Muyuan leads developmentwith technological innovation and has explored twenty coretechnologies such as "breeding, feeding, health, rearing, andslaughtering", driving breakthroughs at the front line of thebusiness. Innovation supports our growth, and innovationreveals that each pig has a potential pro?t space of 600 yuanand the entire pig industry has a potential value space of 400billion yuan to explore. Our value lies in using innovation toimprove production efficiency, reduce breeding costs, andprovide higher-quality pork.Behind innovation is the support of talents. Muyuan attachesgreat importance to talent cultivation and regards talent as thefoundation of corporate development. Muyuan adheres to thevalues-based approach in talent selection and continuouslyimproves our talent development system. At the same time,we cultivate interdisciplinary talents, build career platforms,and help them grow. Daring to entrust young talents withsignificant responsibilities, Muyuan encourages more youngindividuals to step forward, unleash their talents, make
Stick to Innovation andEmbrace Openness and Sharing
achievements, and contribute to the healthy and sustainabledevelopment of the pig farming industry.Muyuan is open to sharing to foster mutual development.In June 2023, Muyuan held an open day event themed "FourHundred Billion Space, Co-creation, and Sharing," where weshared new technologies and experience with peers, sharedcutting-edge technologies in pig breeding, nutrition, veterinarymedicine, and information technology, and rewarded breedingexperts, veterinary experts, scientists, etc., who contributed tothe industry. Such activities contributed to the sustainable andhealthy development of the industry.Muyuan has been raising pigs for over 30 years, starting with 22pigs and now producing 63.82 million heads of pigs annually,ranking the ?rst in the world. Throughout our journey, we'vefelt that pig farming is deeply traditional yet technologicallycutting-edge. Stepping into a new era, innovation has nolimits. The Company will continue to focus on product quality,technological innovation, green development and so on whilesteadfastly promoting openness and sharing, thus laying asolid foundation for advancing sustainable development.Finally, I sincerely appreciate all employees for theirdedication and contributions to Muyuan's development. Iwould like to express gratitude to the government, consumers,shareholders, investors, media, community members, andall stakeholders for their continuous attention and supportto Muyuan as well. I also appreciate the trust and recognitionfrom partners throughout the industry. Muyuan would moveforward together with everyone, shoulder to shoulder, to createa brighter future for all!
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About Muyuan
Corporate Culture
Muyuan leads and drives its development with its values. Embodied in the Basic Law of Muyuan, Muyuan's corporate culture andvalue system take "creating value and serving society" as the core. This system has always been shaping all operation activities ofour business units and subsidiaries, and a?ecting how every Muyuan sta? thinks, acts and feels from the inside out.
Who We AreProducer of high-quality pork; Promoter of social progress.
Our Mission
Our Vision
Serving people with safe pork to help them enjoy a richer life; Becoming a respectablecompany.Business Motto
Strict self-discipline, courage to take responsibility, pursuit of excellence, serving the society.
Creation - Possession = Value
Respect nature, love people, and follow the natural law.
Culture Theme
Muyuan Value Formula
Producing safe and healthy pork products for the public; Promoting healthy industrydevelopment.
Basic Law of Muyuan
Produce healthy foods for society to improve the life quality of the public, helping people enjoyan abundant life.
Create substantial value instead of a bubble with our own strengths.
Create value and serve society; be upright outside and inside, and advance social development.External value outweighs internal value; long-term interests outweigh immediate interests.The value of humans outweighs the value of things; common value outweighs individual value.Social value outweighs pro?t value; customer value outweighs production value.
Maximize social value. Never pass on costs, never shirk responsibilities, and never leave hiddendangers. Take beneficial but not harmful or controversial actions. Persist and never waiverin value creation. Never expect ?uky pro?ts or yield to sel?sh interests. Object to commercialbribery and refuse unearned or illegal gains. Never engage in speculation, tricking, ordispossession. Never engage in underhand money deals. Be strict in self-discipline, be brave toshoulder responsibilities, and pursue perfection.Bring bene?ts for employees. We regard employees as family members, help them grow andbuild a career platform for helping them achieve self-ful?llment. We are determined to bringhappiness to each employee and each family. Everyone can enjoy a happy life here.Make cooperation conducive to customers' interests. Never impose whatever you dislike onothers, but showing towards others what you yourself would like. Always feel for others and treatothers with honesty and sincerity. We take customers as siblings and help each other to realizefairness, uprightness, openness, and transparency in business progress and make true simple,worry-free, e?cient and win-win cooperation.Put knowledge into action to benefit society. Achieve the simultaneous improvement ofeconomic bene?ts, ecological bene?ts, and social bene?ts. Promote an environment-friendlyand animal-friendly business pattern. Promote circular economy and cleaner productionto reduce negative influence on the atmosphere. Upgrade continuously the standards offood quality and actively build an industrial ecology to promote sustainable development.Keep carrying out public welfare undertakings to support education and promote social andeconomic development.Adhere to the values and construct a platform for sharing; keep pace with the times and explorethe unknown; face challenges with courage and go beyond selves; be sel?ess and build Muyuana long-lasting company.
I. Business Purpose:
II. Core Values:
III. Business Selection:
IV. Business Principles:
V. Employee Bene?ts:
VI. Customer Bene?ts:
VII. Social Responsibility:
VIII. Constant Development:
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About Muyuan
Tribute to Pigs
It sacri?ces its life for the happiness of human beings.
A pig lives an ordinary life. It comes to the world quietly and leaves quietly. Everything it has had already been given when we see it gone. A pig lives a great life indeed! The spirit of the pig mirrors that of the Muyuan people.A pig lives a dedicated life. Pigs prove to us that is another life that sustains one life; one life is sacri?ced whilst another is bene?ted.Muyuan people shoulder the lofty mission of producing pork foods and creating a high-quality life for the public. Just likepigs, we are ready to give everything we have to make people's lives better.A pig lives a happy life.
Despite the sacri?ce of its precious life, a pig does not care much about how long it lives or how much it eats, but grows onlybig and strong, happily, and quickly.Pigs prove to us that is the quality rather than the length of life that matters. We should exchange the length of life for thequality of life without regrets, just like pigs.A pig lives a philosophic life.
Whilst people are still thinking about the meaning of life and won't let go of fame and fortune, pigs have given a simple andclear answer, using their lives: the true meaning of life does not consist in how much you take, but in how much you can give tosociety and your fellow human beings.So we cease to merely stand back discussing the meaning of life. We are determined to create value, with a mind full of morededication and less scheming, like pigs.We are grateful to pigs. We raise pigs, but actually, it is the pigs that feed us. To respect pigs is to respect ourselves and to praise pigs is to praise ourselves. Let all of us, like pigs, be simple and happy to give and to make true a high-quality life!
Muyuan Foods Co., Ltd. was founded in 1992 and listed on the Shenzhen Stock Exchange(SZSE) in 2014. With over 30 years ofinnovative development, we have now developed an integrated pork industry chain covering feed processing, pig breeding,commercial pig farming as well as slaughter and processing. Innovation is the foundation of corporate development, and Muyuanadheres to a long-term philosophy of innovation. Seeking breakthroughs at the front line of the business, Muyuan continues tobreak new grounds, promoting intelligent pig farming and leading common development through technological innovation.By building a pig industry Internet platform, we achieve common progress among the upstream and downstream of our supplychain, continuously promoting the transformation and upgrading of the pork product industry.By the end of 2023, Muyuan has operations spanning 223 counties/districts in 108 cities in 25 provincial administrative regionsacross China, with a total asset of 195.4 billion yuan. We have 308 wholly owned and holding subsidiaries and 131,300 employees.In 2023, 63.82 million heads of pigs were sold, and 13.26 million heads of pigs were slaughtered. Muyuan has been adhering to itsvision of "better pork we serve, better life you enjoy" and has devoted itself to producing safe, tasty and wholesome pork productswith high quality, so as to improve customers' life quality and promote the sustainable development of the industry.
Map of Muyuan's Livestock Farming and Slaughter Distribution Nationwide
Company Pro?le
Operational Performance
Unit202320222021Pigs produced10,000 heads6,381.66,120.14,026.3Pigs Slaughtered10,000 heads1,326.0736.2289.9Feed production10,000 tons2,3172,037 1,579Operating revenue100 million yuan1,108.611,248.26788.90
Total assets100 million yuan1,954.051,929.481,772.66EmployeesPerson131,276140,403137,520
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ESG Milestones
The ?rst pig farm in Muyuan, Neixiang Mashan Pig Farm, broke ground.1992
The Mashan pig farm in Neixiang went into operation on June 22, starting Muyuan's pig farming business with 22
piglets.1993
Muyuan started exploring the pig waste dry cleaning technique to cut water use.1998
Muyuan proposed that pig farming development must be synchronized with environmental protection.1999
Muyuan began to promote low-soybean meal diets.2000
Utilization of biogas started a new chapter of using green energy.2001
The low-soybean meal diet was adopted throughout the farms to reduce feed nutrient waste.
The "Ju'ai Education Assistance Project - Spring Rain Program" was launched to support the education in
deprived areas.2003
The Company started exploring farming wastewater treatment solutions and developed the internal circulation
(IC) anaerobic tanks.2004
Farms started implementing clean production systems, and CDM project came into operation.2007
Muyuan was awarded "National Nuclear Breeding Farm of Pigs" and "Standardization Demonstration Pig Farm"
by the Ministry of Agriculture and Rural A?airs of the PRC.
2010
Muyuan initiated and established the Henan Association for Poverty Alleviation and Development.
2011
Muyuan established the two-way backcross breeding system.
Muyuan started to explore standardized emission models and the process of utilizing manure for resource
recycling through land application.
2006
The circular economy pattern of "pig farming - biogas slurry - ecological agriculture" was explored.
Muyuan CDM project passed the UN inspection and became China's ?rst registered CDM project applied in pig
farms.2008
Muyuan purchased barley from Henan, Hubei, and other regions at premium prices to assist farmers during
di?cult times;
Muyuan advanced water conservation at the source by developing pig waterer bowl, designing slatted ?oor to
realize no washing during pig farming.2009
Muyuan explored the manure mechanical dry-cleaning process.
Muyuan developed the third-generation biogas slurry storage pool using HDPE impervious membrane
technology to prevent groundwater pollution.
2012
Shared the "Muyuan Low-soybean meal Diets Environmental Protection Strategy" to drive the industry to reduce
nutrient waste and protect the environment.
Conducted research on the Clean Development Mechanism (CDM) for emission reduction.
Launched the "Ju'ai Education Assistance Project - Golden Autumn Program" to support underprivileged students
in realizing their dream of attending university.2005
The 17th farm in Neixiang was certi?ed by CHINA G.A.P.
2013
Muyuan's environmental protection process was approved by the Ministry of Ecology and Environment,providing a model for environmental protection in large-scale pig farms.2015
Muyuan set five environmental protection goals of "zero emissions, no hidden dangers, no odors, smogreduction, and carbon emission reduction".2017
Muyuan Foods, together with Qin Yinglin and Qian Ying, donated 200 million yuan to support the nationwideCOVID-19 pandemic prevention and control e?orts.2020
Muyuan further reduced its soybean meal usage in feed to 5.7%, driving the industry's reduction of soybean mealto 13%.2023
The pig houses heating without fossil fuels were applied and promoted throughout the Company.The Company explored the improvement of saline-alkali land and planting of seawater rice.2018
Annual Awards and Recognitions
AwardsIssuing Authority
National Key Leading Enterprise in Agricultural
Industrialization
Ministry of Agriculture and Rural A?airs, NationalDevelopment and Reform Commission (NDRC), Ministryof Commerce, People's Bank of China, China SecuritiesRegulatory Commission (CSRC), All China Federation of Supply
and Marketing Cooperatives（ACFSMC）2023 Sustainable Development Model EnterpriseOrganizing Committee of China Economic SummitExcellent Practice of 2022 Annual Report Performance
Elucidation Presentation by Listed Companies
China Association for Public Companies（CAPCO）ESG Best Practice Cases in Investor Relationship Management
of Listed Companies 2023
China Association for Public Companies（CAPCO）"Xinhua Credit Golden Orchid Cup" ESG Excellent Case AwardChina Economic Information Service
Enterprises Listed in the ESG Blue BookAll-China Environment Federation (ACEF), Cailian Press
ESG Blue Book Typical Case AwardAll-China Environment Federation (ACEF), Cailian PressExcellent Enterprise Ful?lling Social Responsibility in Henan
Province Food Industry in 2022
Henan Food Industry AssociationTop 100 ESG Listed Companies of 2023Organizing Committee of the Sanya Forum ESG Leader in Central China AwardThe 18th Yellow River Fortune Forum
The Company established the Sustainable Development Committee and issued the ?rstGreen and Low-CarbonAction Report in the industry.2022
The new pig house with air ?ltration was developed and applied to achieve fresh air ?ltration, independentventilation and air deodorization and sterilization before discharge.The Company held the International Symposium on African Swine Fever Prevention , providing an exchangeplatform for the industry to prevent and control African Swine Fever.2019
The "5+" poverty elimination pattern assisted in lifting 390,000 people out of poverty from 140,000 families across70 counties in 15 provinces.2016
Muyuan went public on the Shenzhen Stock Exchange (SZSE) with the stock code of 002714.Muyuan adopted impervious membranes across all the farms, ensuring groundwater protection as a standardfor generational sustainability.
2014
Muyuan publicly released its low-soybean meal diet formulation to aid the industry in reducing soybean mealand promoting alternatives.Slurry water puri?cation and reuse technology was promoted to save water.The Company donated 100 million yuan for ?ood relief and post-disaster reconstruction in Zhengzhou, Zhoukou,Xinxiang and other severely disaster-stricken areas.2021
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2023 ESG Highlight Performance
Muyuan actively embraces the ESG philosophy, upholding the core values of "Creating Value, Serving Society." With a focus on ESGprinciples, Muyuan diligently pursues the United Nations' 2030 Sustainable Development Goals (SDGs), leading to simultaneousenhancements in economic, ecological, and social outcomes.
2023 ESG Highlight Performance
Comprehensive Implementation of the United Nations'2030 Sustainable Development Goals（SDGs）
In 2023, Muyuan supplied 63.82 million pigs to society and slaughtered 13.26 million pigs, achieving a total operating income of
110.9 billion yuan. Among them, the slaughtering business generated operating income of 21.9 billion yuan. As of the end of 2023,
Muyuan has driven 9,500 suppliers along the industrial chain, creating employment opportunities for 471,900 people.
Adhering to value breeding, we establish a unique two-way backcross breeding system to address the supply of pigs used forbreeding. This enables us to provide high-quality breeding pigs to our customers, ensuring the production of premium pork tobetter meet consumer demands. From 2020 to 2023, we have cumulatively supplied 1.451 million breeding pigs to the industry,with 181,000 breeding pigs supplied in 2023 alone.
Adhering to the concept of innovative development, Muyuan has established an innovative research and development（R&D）system covering pigsty design, feed nutrition, disease prevention and control, environmental protection technology, andintelligent equipment. In 2023, the expenditure on R&D amounted to 1.658 billion yuan.As of the end of 2023, Muyuan and its subsidiaries had cumulatively applied for 2,142 patents, with 1,626 patents authorized.
1.451
Total Supply of breeding pigs from 2020to 2023
million heads181,000
Supply of breeding pigs in 2023
heads
110.9
Revenue in 2023
billion yuan
21.9
Revenue from slaughteringbusiness
billion yuan
63.82
Supply of pigs to society
million heads
13.26
Slaughtered pigs
million heads
9,500Suppliers driven by the industrialchain
471,900Employment opportunitiescreated
Economic Bene?ts
Among them, 181 patents were applied for and 185 patents were authorized in 2023 (including those applied for in previous yearsbut authorized in 2023).Actively rewarding shareholders and investors, Muyuan shares the fruits of development with investors. Since its listing, it hasdistributed dividends totaling 16.828 billion yuan (including preferred shares and share repurchases). In 2023, dividends of 4.003billion yuan were distributed.Strictly ful?lling tax obligations in accordance with regulations, Muyuan comprehensively promotes the invoice managementsystem and the application of digital invoices, timely and accurately declares, and pays taxes in full and on time. It has been ratedas an A-level taxpayer for multiple consecutive years. In 2023, Muyuan and its subsidiaries' tax payments exceeded 800 millionyuan.Strengthening the awareness of integrity and self-discipline, in 2023, the Company actively carried out various forms of educationactivities such as themed training on anti-corruption and integrity, relevant warning education bases visits, and anti-corruptionmonth publicity and education conferences. This year, we organized a total of 95 sessions of anti-corruption and integrity training,and this covers all our employees.Ecological Bene?ts
Continuously increasing investment in environmental protection, a total of 1.056 billion yuan was invested in 2023 forenvironmental process upgrading and rural management network construction to further enhance environmental governancee?ectiveness;Continuously improving environmental management capabilities, Muyuan organized more than 550 environmental protectiontraining sessions internally in 2023, certifying 7,860 individuals through skill assessments and such training covers allenvironmental management personnel. At the same time, we actively promoted environmental management system certi?cation,continuously improving the Company's environmental work processes and standards;We actively promote low-carbon activities. In 2023, the carbon emission intensity was 0.964 kgCO
e/kg of pork, a 3.4% decreasecompared to the previous year. This includes the value of reducing greenhouse gas emissions from the source through initiativessuch as low-soybean meal diets, pig house heating without fossil fuels, and photovoltaic power generation technology. A total of 4.34million tons of CO
e greenhouse gas emissions were reduced in 2023;In 2023, Muyuan increased its investment in research and development of low-soybean meal diets, allocating a total of 65.0645million yuan, contributing to a saving of 31.20 kg of soybeans per pig. This contributed to a total reduction of nitrogen emissionsby 80,700 tons and a reduction of greenhouse gas emissions by 146,600 tons of CO
e;All farms use pig house heating without fossil fuels to reduce heating energy consumption, achieving energy savings and emissionreductions. In 2023, the energy saved by using pig house heating without fossil fuels was equivalent to a reduction in standard coaluse of 333,500 tons and a reduction in greenhouse gas emissions of 867,000 tons of CO
e;Muyuan fully utilizes roof resources, constructs distributed photovoltaic power generation facilities, and promotes photovoltaicpower generation. As of the end of 2023, our installed capacity of photovoltaics was 207.9 MW, with an additional installedcapacity of 117.4 MW. The cumulative electricity generation from January to December 2023 was 36.884 million kWh, supportingthe transformation of energy structure in farms and slaughterhouses and reducing greenhouse gas emissions by 15,200 tons ofCO
e;Muyuan actively explores comprehensive utilization methods of biogas and innovatively implements biogas puri?cation projects.In 2023, Muyuan established 30 new biogas utilization projects, utilizing 34.45 million m? of biogas, saving 22.39 million m? ofnatural gas, and reducing greenhouse gas emissions by 1.8378 million tons of CO
e.
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2023 ESG Highlight Performance
34.45
Biogas Utilization Volume
million m?
22.39
Natural Gas Saved
million m?
1.8378
Reduction in Greenhouse Gas Emissions
million tons CO
e
4.52
Farmland Bene?ted
million mu
146,800Substituted Chemical Fertilizer
tons
1.482
Driving Farmers to Increase Income
billion yuan
1.3482
Carbon Sequestration in Farmland
million tons CO
e
All pig farms install sterilization and deodorization systems at the outlets to eliminate odor without disturbing the public,reducing greenhouse gas emissions by 125,200 tons CO
e. Collaborating with the Department of Agriculture and Rural A?airs andDepartment of Ecology and Environment of Henan Province, Muyuan openly shares odor puri?cation technology to promoteindustry development.Muyuan further promotes integrated livestock-crop system to achieve ecological sustainable development, helping farmersreduce costs and increase income. In 2023, 100% of manure was resourcefully utilized, bene?ting 4.52 million mu(301,333hm?)of farmland, replacing 146.8 thousand tons of chemical fertilizers, sequestering 1.3482 million tons of CO
e in farmland, whiledriving farmers to increase income by 1.482 billion yuan.
Muyuan commits to "Sustainable Water Use" by implementing water-saving technologies such as reclaimed water reuse,enhancing water monitoring, and advancing ?ne water management to mitigate water risks, with freshwater usage at 2.25 m? perhead of pig.Continuously exploring models and technological pathways for soil improvement and governance, in 2023, Muyuan improved229,500 mu(15,300hm?) of saline-alkali soil land, converting barren land into arable ?elds, achieving a yield of 850 catties permu, reducing soil salinity by 52.38%, and increasing organic matter by 6.67%. Additionally, desert management covered 88,200mu(5,880hm?), supporting ecological restoration and biodiversity conservation.
Muyuan diligently ful?lls its product responsibilities by producing safe and healthy pork products for the public. In 2023, Muyuansupplied high-quality pork totaling 5.34 million tons to society, meeting the pork demand of over 100 million people.Continuously optimizing food safety and quality management systems, Muyuan strengthens upstream and downstreamcertifications and inspections to ensure the safety of pork supply. Muyuan has obtained multiple certifications includingFSSC22000, ChinaG.A.P., and ISO9001 in feed, breeding, and slaughtering, with a customer and government inspection pass rateof 100% in 2023.Actively exploring practices to reduce antibiotics, Muyuan systematically promotes antibiotic-free meat, feed, and breeding. In2023, Muyuan used probiotics instead of antibiotics in 272 farms, reducing antibiotic usage.Respecting equal employment opportunities for employees, as of the end of 2023, Muyuan employed a total of 131,276 sta?, withwomen accounting for 21.5%, and women holding 26% of senior positions (including department heads).Valuing employee development, in 2023, Muyuan invested 700 million yuan in vocational training, with an average training timeof 148 hours per employee, continuously enhancing labor skills and job competitiveness.
Social Bene?ts
Muyuan continued to assist farmers in various forms such as plowing, planting, pest control, machinery coordination, weeding,and straw management to ensure e?ective crop management and increase farmers' yields. In 2023, Muyuan invested a total of
31.0522 million yuan in agricultural assistance services.
Muyuan continued the implementation of public welfare projects, including road construction, street lighting, square renovation,a?orestation, and water projects. By the end of 2023, the Company had donated a total of 104.2622 million yuan in public welfareprojects, benefiting 1,609 villages and creating beautiful, safe, and convenient living environments for community residents,signi?cantly enhancing their quality of life.Muyuan continued to carry out the Ju'ai Education Assistance Projects, in 2023, the "Ju'ai Education Assistance Project - GoldenAutumn Program" provided rewards totaling 64.39 million yuan to 21,600 college students, while the "Ju'ai Education AssistanceProject - Spring Seedling Program" distributed 77,933 school bags to elementary and middle school students, continuouslyspreading love and responsibility to society.
52.56%
Soy products procurement from suppliers with sustainable certi?cations
70%Plans to increase such procurement by 2025Over
Prioritizing employee occupational health, in 2023, Muyuan's total investment in safety production amounted to 198 million yuan,providing employees with a safe working environment, and safeguarding them from occupational hazards.Supporting local employment to promote local economic growth, with a local employment rate of 76% in 2023.Persistently expanding local grain procurement (including corn, wheat, and rice) to stimulate community economic development.By 2023, Muyuan had purchased a total of 19.8768 million tons of local grains, a 4.87% increase from the previous year. Local grainpurchases accounted for 89% of total procurement in 2023.Committed to building a compliant, green, and responsible procurement system, Muyuan integrates ESG concepts into suppliersmanagement systems. In 2023, Muyuan sourced 52.56% of soy products from suppliers with sustainable certi?cations, with plansto increase this to over 70% by 2025.
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Sustainable Corporate Governance
SustainableCorporateGovernance
SDGs referred to in this chapter
Corporate GovernanceESG ManagementRisk ManagementBusiness EthicsInnovative Development
019020
Sustainable Corporate Governance
Corporate Governance
Muyuan has been improving its corporate governance system and operation mechanism in strictaccordance with the requirements of relevant laws, regulations, and normative documents, such astheCompany Law of the People's Republic of China,the Securities Law of the People's Republic of China,the Code of Corporate Governance for Listed Companies,the Rules Governing the Listing of Shares onShenzhen Stock Exchange, andthe Business Guidelines of Shenzhen Stock Exchange for Self-disciplineRegulation of Listed Companies. When selecting board members, we consider various factors,including but not limited to their professional abilities, qualifications, professional backgrounds,independence, and competence.As of now, the Company's Board of Directors consists of a total of seven directors, including threeindependent directors, accounting for more than one-third of all directors. The composition ofthe Board of Directors complies with relevant laws, regulations, and theArticles of Association.Additionally, the Board of Directors has a chairman and a vice-chairman who are responsible forformulating and supervising the company's strategies and ensuring their execution. They are alsoaccountable to the shareholders' meeting. In 2023, Muyuan held a total of 8 board meetings.
BoardComposition
As of now, there is one female director on the board, accounting for 14% of the total members. TheBoard of Directors of the Company demonstrates diversity in terms of age, gender, educationalbackground, nationality, etc. It comprises experts from various ?elds such as farming, management,law, economics, ?nance and so on, ensuring the e?cient operation of the board.Mr. Qin Yinglin, the chairman of the Company, has been dedicated to the primary business of pigfarming since the establishment of the Company. He emphasizes innovative research and developmentand is committed to environmental management. In recent years, he has continuously promoted thetransformation and upgrading of the pig farming industry. He shares his experience in the industry ashe possesses extensive experience in sustainable development.
BoardDiversity
Muyuan strictly complies with the requirements of relevant laws, regulations, and normative documents such asthe CompanyLaw of the People's Republic of China,the Securities Law of the People's Republic of China,the Rules Governing the Listing ofShares on Shenzhen Stock Exchange, andthe Business Guidelines of Shenzhen Stock Exchange for Self-discipline Regulationof Listed Companies. We continuously improve our corporate governance structure, establish a modern corporate governanceframework and internal control system, to promote the high-quality and sustainable development of the Company.
Corporate Governance Structure
Governance Structure
General Meeting of Shareholders
Board of Directors
Strategy CommitteeAudit Committee
NominationCommittee
Remuneration andAppraisal Committee
Board of Supervisors
SustainableDevelopment Committee
The Company strictly follows the election procedures and quali?cations for independent directorsas required by relevant laws, regulations, normative documents, and company regulations. Thisensures that independent directors possess the necessary independence to fulfill their dutiesimpartially in various aspects, including participating in board decision-making, overseeing majormatters, and enhancing business development, without being in?uenced by other conditions.As of now, there are three independent directors on the board, accounting for 43% of the totalmembers, which meets the relevant regulations on the proportion of independent directors andensures that the Board of Directors can make e?ective and independent judgments and scienti?cdecisions when deliberating and engaging in major matters.Muyuan has formulatedthe System of Independent Directorand continuously revised it inaccordance with the latest regulations. It requires independent directors to fulfill their duties inaccordance with relevant regulations and system requirements.
BoardIndependence
As of now, Muyuan's supervisory board has a total of three supervisors, includingone chairman of the supervisory board, one supervisor, and one employeerepresentative supervisor. Among them, there is one female supervisor,accounting for 33% of the total.SupervisoryBoardComposition
As of now, Muyuan's board of directors has established 5 special committees: the StrategyCommittee, Audit Committee, Nomination Committee, Remuneration and Appraisal Committee,and Sustainable Development Committee. These committees are composed of directors and providescientific and professional advice to the board on relevant decision-making matters. They alsosupervise Muyuan's risk management, internal controls, and other aspects.Among them, the majority of independent directors serve as conveners in the Audit Committee,Nomination Committee, and Remuneration and Appraisal Committee, which meets therequirements of relevant laws and regulations such asthe Guidelines for Independent Directors ofListed Companies.
SpecialCommittees
2023 Performance of Board of Directors' Special CommitteesCommittee name
The independence of thecommittees (percentage ofindependent directors)
Number of meetings convenedin 2023(occurrences)
Attendance rateStrategy Committee33% 1100%Audit Committee67%6100%Nomination Committee67%2100%Remuneration and Appraisal
Committee
67%3100%Sustainable Development
Committee
67%1100%
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Sustainable Corporate Governance
The convening, holding procedures, and noti?cation time of Muyuan's supervisory board meetings allcomply with relevant provisions such as the Articles of Association. In the daily work, the Company'ssupervisors conscientiously fulfill their duties, effectively supervise the legality and complianceof the company's finances as well as the performance of responsibilities by directors and seniormanagement personnel. They attend shareholder meetings and are present at board meetingsas non-voting members, effectively supervise significant corporate matters, financial conditions,profit distribution, internal controls, and express their review opinions. They actively safeguardthe legitimate rights and interests of the Company and all shareholders. In 2023, a total of sevensupervisory board meetings were held by the Company.
Effectivenessof theSupervisoryBoard
Protect therights andinterests ofshareholders
Muyuan strictly adheres to relevant laws and regulations, clearly de?nes the rights and responsibilitiesof the shareholders' meeting and provides online voting channels. It treats all shareholders equally,ensuring that all shareholders, especially small and medium-sized shareholders, can fully exercisetheir rights. In 2023, Muyuan held a total of two shareholder representative meetings. The convening,holding, deliberation, and voting procedures were all legal and compliant. Over 500 small andmedium-sized investors participated in the meetings on-site and online. All proposals were approvedthrough voting.
Muyuan consistently maintains open channels of communication with investors by establishinga transparent and accessible platform for dialogue. This approach enables ongoing enhancementand deepening of interactions with investors, assisting small and medium-sized investors andinvestment institutions in gaining a more thorough understanding of Muyuan. Speci?c measuresare as follows:
OpenCommunicationChannelsMuyuan sets up o?cial contact methods for investors, such as phone numbers, fax numbers, and email addresses, with dedicatedpersonnel responsible for handling inquiries. This ensures e?ective communication during working hours and provides investorswith prompt feedback and responses through e?cient means.Muyuan strengthens the construction and operation of online communication channels for investors, including setting up adedicated securities affairs section on its official website. We utilize the Shenzhen Stock Exchange Easy Interaction (SSEEI)platform to collect and respond to investor inquiries, complaints, and suggestions. Muyuan also establishes an investor relationsWeChat account platform to promptly release and update relevant information. Additionally, we organize investor open dayevents to deepen communication and interaction with investors.
Protect Investors' Rights and Interests
Under the guidance of regulatory documents such astheOpinions on Further Improving Quality of Listed Companies
and theGuidelines for Investor Relations Management ofListed Companies, Muyuan held an online performancebrie?ng on May 12, 2023, for the ?scal year 2022. During theevent, we addressed and clarified investors' concerns, withindividual investors accounting for 96.84% of the questionsraised.
Environmental Protection Open Day：Muyuan successfully held 324 "Environmental Protection Open Day" events in 24provincial-level administrative regions across the country, inviting a total of 15,758 people, including local villagers andgovernment representatives at various levels, to visit and exchange ideas. This allowed everyone to gain a close understanding ofMuyuan's proactive e?orts in resource utilization and sustainable agricultural development. At the same time, Muyuan invitedfarmers to supervise the operation of facilities, publicized reporting channels, improved our own operational standards, and builtharmonious relationships between villages and enterprises.
Media Open Day: From October 30 to 31, 2023, Muyuan organized a "Media Open Day" event. Representatives from 32 mediaoutlets, including Xinhua News Agency, People's Daily Online, Xinhuanet, and Securities Times, visited Muyuan to observe ourindustrial chain and gain a deeper understanding of Muyuan's development. Our senior management team shared their insightson industry development and corporate operations, and we also provided detailed answers to questions of public concern.Through media channels, Muyuan was able to convey company information to the public in a more comprehensive, accurate, andtimely manner, thus contributing to our further development.
Investor Open Day: On October 30 and 31, Muyuan hosted an "Investor Open Day" event, during which 232 investors visitedMuyuan to gain a comprehensive and in-depth understanding of the company through open communication. The seniormanagement team addressed the questions and concerns raised by the investors. The various perspectives, inquiries, andsuggestions put forth by the attendees also prompted Muyuan to re?ect on its own development and growth.
Exchange Session
Visit the Meat Industry Complex
Visit the Intelligent Technology Exhibition Hall
Exchange Session
Open Days Activities
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Sustainable Corporate Governance
Open Day Events in Ningling Muyuan Farm No. 9Open Day Activities in Zone 4, Sixian Muyuan Farm No. 2
2023 Investor Activity DataTypeFrequencyAnswer the Investor Hotline 1,500Reply to SSEI Q&A490Release Investor Research Summary 19
Press Conference 9Strategy Meeting 5Muyuan has strictly followed the requirements of relevant laws, regulations, and the Company'sArticles of Associationto establish a standardized system for the public disclosure of information.This system ensures that the disclosed information is true, accurate, complete, timely, and fair.We have designated "Securities Times", "China Securities Journal", "Shanghai Securities News,"and "Securities Daily" as media outlets for information disclosure, and the CNINFO website as theplatform for company information disclosure.In 2023, Muyuan disclosed a total of 226 announcements for the listed company through thedesignated information disclosure website. All of the announcement content was true, accurate,complete, and timely, fully conveying Muyuan's relevant information to investors. At the same time,we proactively disclosed information on environmental protection, low-carbon innovation, socialwelfare, and corporate governance by publishing theMuyuan: 2022 Annual Environmental, Social,and Governance (ESG) Reportand the Muyuan: 2022 Green and Low-Carbon Action Report. Thisdemonstrates our sustainable development practices and continuously enhances the e?ectivenessand comprehensiveness of our information disclosure.
StandardizedInformationDisclosure
Muyuan continues to focus on its core business of pig farming, actively communicating its value tostakeholders, and sharing the fruits of its development with investors under the premise of ensuringsustainable and high-quality growth. Since the listing, Muyuan has strictly followed the profitdistribution policy established in the Articles of Associationto carry out sustainable cash dividends.Since listing, Muyuan has distributed a total of 16.828 billion yuan in dividends (including preferredstock and share buybacks). Of this amount, 4.003 billion yuan was paid out in dividends for the year2023.We will continue to effectively manage the dynamic balance between performance growth andshareholder returns, adhering to a "long-term, stable, and sustainable" multi-channel mechanismfor shareholder rewards, and sharing the fruits of industry and company development with a broadbase of shareholders.Dividend Distribution Since IPO
16.828
Dividend Distribution in 2023
4.003
Share theFruits ofDevelopment
Billion yuanBillion yuan
To promote the long-term sustainable development, we actively carry out share buybacks thatcan be used for employee stock ownership plans and equity incentive plans. We also encouragesenior management and employees to increase their holdings in the Company's stock, therebystabilizing investor con?dence and enhancing the overall value of the Company.Our fourth board of directors' fifteenth meeting, held on December 12, 2022, reviewed andapprovedthe Proposal on the Repurchase of the Company's Shares. The plan is to repurchasea total amount no less than 1 billion RMB and not more than 2 billion RMB (inclusive of theamounts mentioned), to be used for the employee stock ownership plan or the equity incentiveplan. As of the date of this report's disclosure, the aforementioned share repurchase plan hasbeen fully implemented. For more details, please refer to our relevant announcements on theChina Securities Regulatory Commission's website (www.cninfo.com.cn).
StabilizeInvestorConfidence
Based on con?dence in the Company's future development and recognition of its long-term investment value, the controllingshareholder and Mr. Qin Muyuan (the actual controller's son), planned to increase their holdings in the Company's shares with atotal amount of no less than 500 million RMB (inclusive) and no more than 1 billion RMB (inclusive). Additionally, certain directors,supervisors, senior management personnel, and core management, technical, and business staff of the Company planned toincrease their holdings in the Company's shares with a total amount of no less than 1 billion RMB (inclusive) and no more than
1.2 billion RMB (inclusive). As of the date of this report's disclosure, these certain directors, supervisors, senior management
personnel, core sta?, and Mr. Qin Muyuan (the controlling shareholder's son), have all completed the aforementioned plan toincrease their holdings.
ESG principles are a crucial guide for companies to achieve sustainable development. Muyuan is committed to building asustainable corporate governance framework, integrating ESG concepts into the Company's management and operations, andelevating sustainable development to the level of strategic decision-making.ESG Management
To ensure the e?ective implementation of ESG initiatives, Muyuan established a three-tier ESG management structure consistingof "decision-making, organizational, and operational levels". Under this framework, a Sustainable Development Committeehas been set up, chaired by the Company's Chairman, Qin Yinglin, who is responsible for overseeing the implementation andprogress of sustainable development strategies. The Sustainable Development Committee also plays a role in assessing andmaking decisions on signi?cant events related to sustainability.The Sustainable Development Committee of the Boards of Directors has established an o?ce, whose responsibilities includestudying the resolutions of the Board's Sustainable Development Committee, developing corresponding execution plans, andcoordinating specific ESG-related matters proposed by the committee. It also organizes and guides the operational level in
ESG Management Structure
Notes: 1.Muyuan Foods increased its shareholding by 272,600 shares throughcentralized bidding and by 13,564,147 shares through the trust plan, totaling13,836,747 shares. 2.Before this increase, Muyuan Foods held 834,925,406 shares ofthe Company, accounting for 15.2767% of the total share capital. Mr. Qin Muyuanheld 2,034,784 shares of the Company, accounting for 0.0372% of the total sharecapital.
II. Implementation Results of the Shareholding Increase PlanAs of the disclosure date of this announcement, the Shareholding Increase Plan forthe Company's controlling shareholder, Muyuan Foods, and Mr. Qin Muyuan, theson of the actual controller, has been completed. The speci?c details of the increaseare as follows:
I. Completion Status of the Shareholding Increase Plan for Certain Directors,Supervisors, and Core Personnel of the CompanyAs of January 19, 2024, the shareholding increase plan for some directors,supervisors, and core personnel of the Company has been completed. The speci?cincrease details are as follows:
Notes: 1.Before this increase, Mr. Li Fuqiang held 7,494,858 shares of the Company,accounting for 0.1371% of the total share capital; after the increase, he holds 7,520,258shares, accounting for 0.1376% of the total share capital. 2.For other directors,supervisors, senior management personnel, and core technical and businesspersonnel under the trust plan, no company shares were held before this increase.
3.Due to rounding up, there may be slight discrepancies in the above ?gures.
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Sustainable Corporate Governance
Muyuan actively responds to the United Nations' Sustainable Development Goals (SDGs), focusing on the pork food industry andtaking into account the demands of all stakeholders. Muyuan adopts the "Five Commitments" as the core support of its sustainabledevelopment strategy, making comprehensive efforts in five areas: food safety, green and low-carbon development, win-wincooperation, employee care, and public welfare.
Strategy of ESG ManagementMuyuan's Social Responsibility Strategy
ESG Management System
SustainabilityDevelopment Committee(Decision-making level)
The Sustainable Development Committee conducts research and gives advice on majordecisions related to the Company's sustainable development and ESG, and supervisesthe implementation and progress of the sustainable development strategies and plans,as well as its performance on key issues such as addressing climate change, safeguardingpublic health and safety and ful?lling social responsibility. The Committee also identi?essustainability risks related to the Company, assesses the impact on the Company of theserelevant risks, and reviews the Company's annual ESG Report.The ESG Office is set up under the Sustainable Committee of the Board of Directors,responsible for undertaking speci?c matters related to sustainable development and theoverall organization and management of all major ESG issues.Subsidiaries and
departments(Operational level)
The ESG directors of each subsidiary and each department are responsible for carring outspecific ESG matters, implementing different ESG material issues' objectives set by theheadquarters and ESG management-related work, and organizing communication withstakeholders.
Organizationalmanagement
Dailymanagement
Indicatormanagement
Information
disclosure
Performance
appraisal
Capacitybuilding
Five CommitmentsSustainable Development GoalsFood safety
Muyuan leads the development in the industry by sticking to scienti?c andtechnological innovation, continuously engages in antibiotic-free farming,and produces safe, healthy, nutritious and delicious food for the society.Green and low-carbon development
Muyuan has set a ?ve-tier environmental goal of "zero emissions, no hiddenhazards, no odor, smog reduction, and carbon emission cuts," advocating fora circular economy and clean production to protect the ecosystem.Win-win cooperation
Adhering to"fairness, equity, openness and transparency", Muyuan iscommitted to building a sustainable supply chain to achieve efficient andmutually bene?cial outcomes.Employee care
Muyuan emphasizes bene?ting employees and helping them to develop andrealize their life values.
Public welfare
Sticking to its values, Muyuan aims to build a sharing platform to makecontinuous progress and stay focused for long-term growth.
carrying out their work.Specific tasks are advanced and executed by the relevant departments' sustainability working groups to ensure that key ESGissues are e?ectively addressed, the sustainable development management system operates e?ectively, and the Company's ESGperformance is steadily enhanced. Heads of each subsidiary and department are responsible for implementing the Company'sESG-related resolutions based on their actual conditions respectively, ensuring that the Muyuan's ESG philosophy is thoroughlyimplemented and executed throughout the organization.
ESG O?ce(Organizational level)
Muyuan places great emphasis on aligning common goals with stakeholders, including consumers, shareholders, investors,government and regulatory bodies, suppliers, employees, communities, and the public. The Company has established a regularand multi-channel communication mechanism with these parties, actively addressing their concerns and demands. Muyuancomprehensively identi?es risks and opportunities for sustainable development and continuously improves its ESG managementand practices.
Stakeholder Identi?cation and Communication
StakeholdersMain issuesCommunication channels
Consumers
·Food safety and quality·Customer privacy and security·Consumer rights protection·Responsible marketing
·Follow-up calls and market survey·O?cial website service center·Corporate WeChat o?cial accountand e-mail·Report hotline
Shareholders and investors
·Lawful and compliant operation; safetyproduction·Corporate governance and transparency·Risk prevention and management·Technological innovation and development·Business ethics management·Steady growth in investment returns
·General meeting of shareholders andinvestor surveys·Performance explanation meetingsand Information disclosure·Corporate annual report,announcement and roadshow·Securities a?airs special page·SSEI platform·WeChat o?cial account
Government and regulatory
authorities
·Lawful and compliant operation·Corporate governance and transparency·Rural revitalization assistance·Biodiversity, land use and carbon reduction·Whole-life cycle pollution management andlawful tax compliance·Contribute to local economic development
·On-site investigations·Work seminars·Daily communication and debrie?ng·Project approval and supervision;regulatory assessment·Voluntary tax payment andspecialized conferenceSuppliers
·Sustainable supply chain·Business ethics management·Information con?dentiality
·Honesty & integrity meeting;bidding meeting·Fairs and daily communication·Partner training·Onsite partner auditing·Procurement platform
Employees
·Protection of employees' rights and interests·Safety production·Occupational disease prevention and control
·Training and labor union activities·Workers' congress and culturalbuilding·Online communication platform·Year-end review and planning meeting·Report hotline
Community and the public
·Co-construction of community and greenpackaging·Biodiversity and land utilization·Water resources management and employmentpromotion·Stimulate local economic development·Rural revitalization assistance
·Field visits and surveys·O?er job opportunities andcommunity activities·Employee volunteer activities andpublic welfare activities·Support for social welfare initiativesand agricultural technical services
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Sustainable Corporate Governance
To e?ectively understand and respond to stakeholders' concerns about Muyuan, a questionnaire was conducted to screen theissues of signi?cance to stakeholders, and these issues were analyzed to determine the priority of material issues by integratingMuyuan stakeholders' concerns about the sustainable development of Muyuan shares. A materiality issue matrix for Muyuan's2023 has been summarized, which helps the Company identify and manage issues related to risks and opportunities, in order toe?ectively meet stakeholders' expectations.
According to the United Nations' 17 SustainableDevelopment Goals(SDGs), Shenzhen StockExchange requirements, company strategy,industry characteristics and business priorities, wedetermined the list of materiality issues for Muyuan.
Through a combination of online questionnairesurvey and communication interviews to gain adeeper understanding of stakeholders' expectationsand concerns, we combined Muyuan's sustainabledevelopment strategy with industry developmenttrends, further evaluated and re?ned the list of topicsto form matrix.
From "influenced by Muyuan" and "influenceon Muyuan", we identify stakeholders from twoaspects and treat them as main research subjects.
Materiality issues will be discussed by theSustainability Committee of the Board ofDirectors for review and con?rmation.
MaterialityIssuesAssessmentProcess
0304
High AttentionModerate AttentionLow AttentionImportantVery importantImportance to Muyuan
ImportantImportance to stakeholdsers
Very Important
Product quality management systemProtect shareholders' rights and interestsProtection of employee rights and interests
Employee career development
Low carbon actionsSafety production system construction
Business ethics management
Sustainable supply chain
Legal and compliant operationsTechnological innovation and R&DWater resources management
ESG management system constructionConsumer rights protection
Pollution and waste managementCustomer privacy and securityOccupational disease prevention and control
Construction of environmental management systemAnimal welfareAnimal quality management
Risk prevention and management
Community buildingRural revitalization
Green packagingEcological restoration and biodiversity conservation
Supply chain managementt mechanism
Materiality Assessment
Build Three Lines of Defense to Manage Risks
Muyuan attaches great importance to risk management, establishing and refining a risk management mechanism. It hasconstructed three lines of defense covering departments of business operation, compliance management, and compliance auditfor risk management. This involves three stages: pre-risk prevention, in-process control, and post-emergency response. This full-process control ensures the rapid identi?cation and early warning of business risks, with legal intervention in a timely manner.Risk control strategies are classi?ed and formulated, contingency plans are improved, and the internal control system is fullysupervised and inspected by the audit department, achieving full-process control and tracking of risks, ensuring there are nohidden dangers.Muyuan attaches great importance to the construction of systems for risk management and internal control. It has made policiesand procedures for risk management and built the three lines of defense to manage risks, which involves departments of businessoperation, compliance management, and compliance audit, to see responsibilities are ful?lled by business units while businessand production are focused on and improved.
Risk Management
(business, ?nance, human resources, government a?airs, legal a?airs, auditing)
Main Business: Breeding pigs - Feed - Pig farming production - Meat productsKey Areas: Environmental Protection - Product Quality - Safe Production - Labor Employment - Finance and Taxation
First Line ofDefense - BusinessDepartment
Second Line ofDefense - ComplianceManagement Department
Third Line ofDefense - InternalAudit Department
External regulations internalization, establishment of regulations and systems
Strengthen internal control, prevent risks, promote compliance
ComplianceCulture
1. Values
2. Cultural
Integration withSystems
3. Understanding
the Law -Complying withthe Law - Abidingby the Law -Applying the Law
Process Standard
Systems
Compliance ManagementOperational Mechanisms
1. Compliance Risk Identi?cation
and Early Warning Mechanism
2. Compliance Risk Response
Mechanism (Major Incidents,Emergencies, Media Public Opinion)
3. Compliance Review Mechanism
4. Compliance Management
Assessment and AccountabilityMechanism
5.Compliance Management System
Evaluation Mechanism
Information Technology
Construction
1. Process
Integration
2. Process Control
3. Interconnection
4. Data Sharing
5. Dynamic
Monitoring
6. Risk Warning
7. Intelligent
Decision-making
ComprehensivecomplianceManagement institutionalization, system formularization, process formalization, information digitization
Internal RegulationsExternal Laws
Compliance and EnforcementEmbedded in Systems
Domestic Lawsand Regulations
AdministrativeRegulations andLocal Regulations
Regulatory PoliciesRelevant to Enterprise
Operations
Business Practices,
VoluntaryCommitments,Ethical StandardsIndustry Guidelinesand Norms; NationalStandards, Industry
Standards, Local
Standards
International
Treaties,Conventions;Laws in Overseas
Operating
Locations
Values, Corporate Culture,Corporate Governance
Company Bylaws, Internal Rules and
Regulations, Standards, Processes
Code of Business Conduct,Employee Code of Conduct
1. Commercial Code of
Conduct
2. Employee Code of
Conduct
3. Risk Map
4. Risk Control Report
5. Business Partner
Compliance Management
6.Targeted Business
Compliance Guide
7.Job Responsibilities List
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Sustainable Corporate Governance
1st line of defense:
risk identi?cation andearly warning
The business operation department serveas the "first line of defense" in Muyuan'srisk management. Each department isresponsible for identifying, assessing,and handling compliance risks withinits jurisdiction and undergoes trainingprovided by the compliance managementdepartment. Different managementmeasures are developed for known risks,unknown risks, and uncertain risks toaddress them accordingly.
Known risks: Further improve process
standards and system construction, achievemanagement at the smallest granularity, andeliminate hidden risks.Unknown risks：Insightfully assess laws,regulations, industry policies, and externalchanges, delve into internal business, andtransform unknown risks into known risks.Uncertain risks: Combine current business
status, existing regulations, and regulatorypolicies, comprehensively assess andprevent risks, avoiding escalation or neglect.Continuously improve crisis responsemechanisms and handle them promptly andappropriately.
2nd line of defense:
a sound risk managementmechanism
The Legal Department serves as the"second line of defense" in Muyuan's riskmanagement. It oversees and coordinatesthe implementation of compliancework, and is responsible for buildingthe compliance management system,internalizing external regulations,coordinating and organizing variousdepartments to carry out daily compliancework, strengthening compliance systemconstruction, compliance review andassessment, and ensuring the effectiveoperation of the compliance system.
The comprehensive view of risks across variousbusiness sectors is analyzed, focusing on keyrisk control issues such as qualifications andlicenses, land use, safety production, ecologicalenvironment protection, feed and veterinarydrugs, and accident management. Specialgovernance initiatives are implemented toaddress these issues. This marks the initialconstruction of a risk prevention and controlsystem guided by risk management, basedon institutional development, supportedby internal controls, driven by compliancemanagement, and safeguarded by legal services.
3rd line of defense:
a comprehensive auditand supervision system
The Audit Department serves as the"third line of defense" in Muyuan'srisk management, establishing acomprehensive, authoritative, and e?cientaudit supervision system. It implementsan audit supervision closed-loop consistingof "risk assessment - audit planning -audit supervision - issue investigation -internal control improvement - re-audit",constructing an open and collaborativeaudit supervision ecosystem to maximizethe e?ectiveness of supervision.
We establish a misconduct reportingmechanism with total involvement and amplerewards for whistleblowers, fostering a workpattern of all-sta? supervision; constructing ananti-corruption system, combating malfeasance,promoting reform through cases, and providingcautionary education to build a corruption-freesystem of "dare not, cannot, and do not wantto corrupt". We enhance our internal controlsystem guided by risks, comprehensivelysupervising the operation of key business areas,promptly identifying anomalies, conductingaudits, and forming a supervision closed-loopmechanism constituting "audit supervision- issue identification - issue rectification -noti?cation of accountability - internal controlimprovement".
Transparent Tax Management
The Company's risk management training follows the principles of full coverage, targeted focus, and normalization to ensure thatall employees deeply understand the Company's risk management objectives. The goal is to ensure that all employees consciouslyadhere to risk management requirements, strengthen risk management thinking, and enhance risk management awareness. Atthe same time, our employees acquire necessary skills and knowledge to ful?ll their risk management responsibilities, and carryout their job duties in a capacity that is compatible with the Muyuan's culture, and jointly build the company's compliance valuesand achieve the development vision.In 2023, the Company actively conducted multiple risk management training sessions through a combination of online and o?inemethods. These training sessions covered areas prone to frequent violations such as land use, environmental protection, safetyproduction, labor force, integrity and honesty, intellectual property rights, and other areas. This initiative aimed to continuouslyenhance the risk management capabilities of all employees.
Strengthen Risk Management Awareness
Business Ethics
Construct an Anti-Corruption System
The Company is continuously advancing the construction of an anti-corruption system based on the principles of "dare notcorrupt, cannot corrupt, do not want to corrupt". It maintains a zero-tolerance approach towards corruption, swiftly investigatingand rigorously punishing corrupt practices to reinforce deterrence against corruption. The formulation and implement ofpolicies such asthe Integrity and Self-discipline Management Systemandthe Penalty Measures for Integrity and Self-disciplineIncidentscontribute to strengthening deterrence measures. The Company promotes the digital platforms to enhance safeguardsagainst corruption while enhancing awareness against corrupt practices through cultural guidance, institutional promotion,and cautionary education. The company integrates three key areas including investigation and punishment of corruption,improvement of mechanism systems, and promotion of integrity education, fostersing an integrated approach to punishment,prevention, and governance. This contributes to the implementation of an integrity and honesty culture, creating a new anti-corruption momentum for the Company, and building a business environment where everyone is self-disciplined and integrity isupheld.
Muyuan strictly ful?lls its tax obligations in accordance with tax laws and regulations, and has formulatedthe Tax DeclarationManagement policy. It has established a three-level approval and review mechanism and Muyuan has regularly submitted tax-related information. By promoting the invoice management system and digital invoice applications, and adapting to "NaturalSystem Services", the Company has established a comprehensive, e?cient, and intelligent tax management system, ensuringtimely and accurate declaration and payment of taxes in full accordance with the law. For consecutive years, Muyuan has beenrated as an A-level taxpayer. In 2023, Muyuan and its subsidiaries paid taxes exceeding 800 million yuan. Additionally, Muyuan-owned group of companies is included in the management of the National Thousand Enterprise Groups, strictly reporting theCompany's ?nancial data in accordance with relevant requirements, further enhancing tax transparency. No tax-related disputesoccurred during this ?scal year.
Implement Big Data Anti-corruptionMuyuan places great importance on anti-corruption governance in all aspects of the Company's operations. Through building anintegrated digital platform increasing transparency and comprehensive supervision, and through applying intelligent technologyand methods, the deterrence against corruption will be increased. Big data monitoring indicators are integrated into sales,procurement platforms, etc. By utilizing information technology to implant cases into business digital platforms, the Companycontinuously reinforces the educational function of anti-corruption ideology. This forms a safeguard mechanism of "dare notcorrupt, cannot corrupt, do not want to corrupt".
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Sustainable Corporate Governance
Establish a Complaint Reporting MechanismMuyuan continues to improve its integrity and honesty system by establishingtheIntegrity and Honesty Reporting Management System. We implement a system ofreporting and supervision by all sta? members, providing multiple channels suchas telephone, email, WeChat o?cial account, company website, letters, and visits.We create a reporting group covering all sta? members and opens channels forreporting violations of integrity and honesty, with reported information reachingrelevant parties in real time. We also specifie a reporting reward program toencourage both internal and external personnel to supervise and report onbehaviors related to company management systems and major operational issues.In 2023, Muyuan investigated a total of 126 cases of integrity and honesty incidents(including 27 criminal cases), involving a total amount of 10.192 million yuan.We disciplined 186 internal corrupt individuals directly (including transferring35 individuals to public security agencies) and blacklisted 86 external businesspartners (including transferring 18 individuals to public security agencies).Muyuan has established a whistleblower protection mechanism, ensuringstrict confidentiality of the whistleblower's personal information and providedmaterials. If the auditing personnel handling the report have a close familialrelationship or vested interests with the reported individual, they must recusethemselves. Publicity and rewards for whistleblowers will not disclose their namesand their company names without their consent.
Strengthen Integrity and Self-discipline Awareness
Muyuan incorporates the Integrity and Self-discipline Commitmentinto labor contract clauses and includesthe Integrity andSelf-discipline Management Systemas a mandatory examination and certi?cation requirement for new employees. It is linked totheir probation period assessment. All employees have to undergo relevant learning, examination, certi?cation, and signing of
the Integrity and Self-discipline Commitmentupon joining the Company. The Company organized all employees on duty to signthe Integrity and Self-discipline Commitment.In 2023, the Company actively conducted various forms of integrity and honesty promotion and education activities, includingthematic training, visits to warning education bases, and anti-corruption month promotion and education conferences. A total of95 integrity and honesty training sessions were organized, achieving full coverage of all employees. This e?ectively enhanced theintegrity awareness of all sta? members and forti?ed their ideological defense lines against corruption.
"International Anti-Corruption Day" Warning Education ActivitiesSales Department Integrity and Honesty Conference
By deeply mining big data and implementing real-time online supervision, we enhance our ability to predict, alert, and investigatecorrupt behavior. This strengthens our oversight and constraints on corrupt activities, thereby reducing opportunities for corruptindividuals to break the law or violate regulations.
Innovative Development
Muyuan conducts university-enterprise cooperation and jointly establishes industrial research institutes to achieve high-levelintegration among enterprises, universities and research institutes, e?ectively enhancing the new quality productivity. Muyuancollaborates with universities such as Westlake University and Henan Agricultural University, as well as research institutions,to jointly build industrial research institutes. Focusing on areas such as synthetic biology, intelligent farming, environmentalmanagement, disease prevention and control, and nutrition and health, forward-looking research and development are conductedto create a new benchmark for enterprises-universities-research institutes integration. This e?ectively enhances technologicalinnovation vitality and provides consumers with healthy and nutritious pork products.
Promote Cooperation among Enterprises, Universities and Research Institutes
Muyuan places high importance on and encourages technological innovation, continuously increasing investment in researchand development, providing a favorable environment for R&D personnel, and attracting outstanding scienti?c research talents.It has established and improved innovative incentive systems and built innovation research and development platforms. In 2023,the Company's R&D expenses amounted to 1.50% of its operating income, totaling 1.658 billion yuan. By the end of 2023, Muyuanhad undertaken six national key special projects and received four provincial science and technology progress awards.
Establish an Innovative Research and Development Platform
1.658
R&D expenses in 2023
billion yuan
Undertaken national key specialprojects
On July 10, 2023, the unveiling ceremony of the fourth and ?fth batches of provincial laboratories in Henan Province was held.Among them, Muyuan Laboratory, jointly led by Westlake Muyuan Synthetic Biology Research Institute and West Lake University,with the participation of Henan Academy of Sciences, Henan Agricultural University, Nanyang Institute of Technology, HangzhouWest Lake Education Foundation, and Muyuan, was listed among the fifth batch of four laboratories. In the future, MuyuanLaboratory will focus on building a ?rst-class synthetic biology innovation platform, establishing a comprehensive green andlow-carbon technology system and green manufacturing support system, and achieving dual breakthroughs in original scienti?cresearch and industrial implementation of results.
Enterprises-Universities-Research Institutes Collaboration
Practical Achievements
The Unveiling Ceremony of Muyuan LaboratoryOn-site O?ce Operations at Muyuan Laboratory
1.50%
Accounting for operatingincome
Received provincial science andtechnology progress awards
Muyuan has currently achieved preliminary early warning systems for areas with high occurrences of corruption and high-risksegments. By monitoring data in real-time during stages such as livestock marketing and sales, we have created a re-conciliatoryclosed loop to ensure the safety and accuracy of biological assets. Also, we optimize our processes and promote precisemanagement by using digital technology, successfully closing corruption loopholes.
033034
Sustainable Corporate GovernanceOn October 30, 2023, Henan Agricultural University and Muyuan held a cooperative symposium at the Company. The meetingdiscussed various topics including Muyuan's core cultural concepts, achievements in intelligent equipment research anddevelopment applications, integration of production and education between Muyuan and Henan Agricultural University, andfuture plans. Subsequently, speci?c cooperation projects between the two will be further clari?ed, and e?orts will be made tosolidify the work of the joint research institute to truly serve industrial development.
Visiting the Intelligent Technology Exhibition Hall
On the morning of December 19, 2023, the groundbreaking ceremony for Henan Muyuan Anliang Synthetic Biotechnology Co.,Ltd. with an annual production of 30,000 tons of synthetic biological products was held in Neixiang County, Henan Province. Thisevent also marked the unveiling ceremony of the Muyuan Laboratory and the production test base of the Nanyang West LakeMuyuan Synthetic Biology Research Institute. This signi?cant occasion further solidi?ed the research and application of syntheticbiology technology, aiming to enhance pig production e?ciency.
Groundbreaking Ceremony Unveiling Ceremony
Talent development is the core of enterprise growth. Muyuan builds an open career platform to attract outstanding scienti?cresearch talents. As of the end of 2023, Muyuan Group had a total of 6,681 research and development personnel, accountingfor 5.09% of all employees. Among them are elite talents from top domestic and international universities such as TsinghuaUniversity, Peking University, the Chinese University of Hong Kong, and George Washington University. Their research directionscover various professional ?elds including arti?cial intelligence, synthetic biology, and information technology.
Attract Outstanding Scienti?c Research Talents
6,681By the end of 2023
5.09%
R&D personnel
R&D personnel accounting for
Unveiling of HAU Muyuan Joint Industrial Research Institute
of Animal Husbandry
The Company designates June 22 of each year as the annual Pig Festival, where significant rewards are given to innovativeleaders and teams who make outstanding achievements, stimulating more breakthroughs and more leaders to proceed from theoriginal point. This approach e?ectively integrates innovative development with practical production, facilitating the e?ectivetransformation and implementation of R&D achievements, and continuously driving industry progress. As of 2023, the Companyhas held the eighteen annual Pig Festival, continuously motivating talent innovation through comprehensive incentive measures.
Awarding Professor Yu Bo from the College of VeterinaryMedicine, South China Agricultural University the"Outstanding Contribution Award".
Awarding the "Million-Yuan Innovation Prize" to Professor LiXinjian's team from the College of Animal Science, HenanAgricultural University
Muyuan shares the fruits of development with its employees under the incentive principles that rewards will go to anyone whocreates value; whoever creates value ?rst will be rewarded ?rst; and those who create more value will get more rewards. We willcontinue to optimize the incentive mechanism and reward handsomely those who make achievements. The reward standards areconsistent, regardless of internal and external personnel, professional and non-professional personnel, and the di?culty of theproject. Through su?cient rewards, we are able to encourage the talent's enthusiasm and potential for innovation.
Optimize Innovation Incentive Mechanisms
Muyuan adheres to laws and regulations such astheTrademark Law of the PRC, the Patent Law of the PRC, and the CopyrightLaw of the PRC, continuously re?ning its intellectual property protection system and strengthening the protection of companytrademarks, patents, copyrights, and other intellectual property rights. The Company has established an intellectual propertyteam, with dedicated personnel responsible for intellectual property management, while also reinforcing employees' awarenessof intellectual property protection to enhance brand competitiveness.As of the end of 2023, Muyuan and its subsidiaries have accumulated 2,142 patent applications, with 1,626 patents granted. Manyof these patented technologies are at the forefront domestically and internationally. Speci?cally, in 2023, the Company applied for181 patents and obtained 185 patents (including some from previous years that were granted in 2023).
Enhance Intellectual Property Protection
035036
Muyuan Foods Co., Ltd. 2023 Environmental, Social, & Governance Report
EnvironmentallyFriendlyDevelopment
Low-carbon ActionsGreen ProductionSustainable AgricultureEcological Restoration andBiodiversity Conservation
SDGs referred to in this chapter
037038
Climate change has become an issue of common concern around the world, and Muyuan highly recognizes the importance ofgreen and low-carbon for the sustainable development of enterprises. We comprehensively carry out carbon inventory, identifyclimate risks and opportunities, actively take low-carbon actions, and ful?ll corporate responsibilities. This report uses the ISSBframework to disclose the Company's response to climate change issues.
Low-carbon Actions
The Boards of Directors
Sustainable Development
Committee
Muyuan has established a Sustainable Development Committeeat the board level, responsible for reviewing and formulatingthe Company's sustainable development strategy and objectives;supervising the implementation of the Company's sustainabledevelopment plan; reviewing climate change and responsemeasures; and reviewing the disclosure of sustainability-relateddocuments.
Decision-making LevelThe Management LevelOperational Level
The Green and Low-Carbon Office is responsible forcoordinating and promoting the Company's carbon reductionefforts. It formulates carbon emission management strategicobjectives and plans; identi?es and evaluates climate change-related risks and opportunities to formulates responsemeasures; establishes a carbon neutrality management system,clarifing the functions of different business departmentsin carbon emission reduction work; empowers and guidesthe implementation of carbon emission management work;conducts carbon emission management assessments andevaluations, and discloses data.
Each department clarifies the person in charge of carbonemmision management and forms a sustainable developmentgroup to implement low-carbon tasks.The group decomposesemission reduction targets, implements emission reductionmeasures, monitors and compilies carbon emissions data,and ensures that all departments achieve emission reductiontargets.
Muyuan has established a low-carbon management structure composed of "decision-making, organizational, and operationallevels", clarifying the supervision and management responsibilities at each level, and promote green, low-carbon and sustainabledevelopment from top to bottom.
Governance
CarbonAssetInventory
CarbonReductionAction
CarbonNeutralityand Bene?ts
Green and Low-Carbon O?ce
Muyuan has incorporated low-carbon development into its sustainable development strategy framework, establishing fivecarbon asset management businesses: "carbon emission reduction, carbon branding, carbon gains, carbon services, and carbonnet zero." Clear reduction pathways have been de?ned, along with mid-term and long-term carbon reduction goals. Throughtechnological innovation and management improvements, Muyuan actively manages its carbon emissions by enhancingproduction quality and e?ciency, implementing energy-saving measures, and utilizing renewable energy sources. It focuses onreducing both Scope 1 (direct emissions) and Scope 2 (indirect emissions) emissions, extending carbon reduction practices to theentire life-cycle of pork production. This synergistic approach along the value chain aims to produce green, low-carbon pork,contributing to the achievement of dual carbon goals.
Strategy
2025
The carbon intensity of 1kg pork will be reduced by 2.5% (including feed, farming, and slaughter)The utilization of biogas will be increased by 50.6%.The installed capacity of distributed photovoltaic power generation will be increased to 50MW.The installed capacity of biogas power generation will reach 10MW.Further optimization of the energy structure, reducing the proportion of fossil energy use.Implementation of soil test and fertilization and serve an area of 4.62 million mu(308,000hm?).
2030
Implement carbon emission reduction management throughout thelife-cycle of pork production, reducing the carbon intensity of 1kgpork by 5%The utilization of biogas will be increased by 348.9%.The installed capacity of distributed photovoltaic power generation will be increased to over10GW.Organic fertilizer utilization will increase, with the proportion replacing chemical fertilizerexceeding 50%.Straw recovery and treatment will be explored to reduce greenhouse gas emissions fromfarmland.The Muyuan Carbon Management Platform will be launched.Employee carbon emission assessment will be implemented, encouraging individual carbonreduction.
2050
Joint e?orts of the entire society to achieve a global warming limit ofless than 1.5℃Continuous improvement of energy-saving, carbon reduction, and carbon sequestrationnmeasures will be pursued to achieve ultimate carbon emission reduction.Carbon reduction services will be provided throughout the industry chain to assist in collectiveemission reduction.Exploration of ESG financial investments will be conducted to support the low-carbonindustry chain upgrading and transformingNote: The total GHG emissions of Muyuan in 2021 is used as a baseline for future mitigation actions
Sustainable Development WorkingGroup in each operation departments
039040
Feed (Scope 1, 2)
Low-soybean meal dietsFeed bulk packaging
Biogas utilization
Farming (Scope 1, 2)
Pig house heating without fossil fuelsPhotovoltaic power generationBiogas utilizationFeed pipeline transportationApplication of new energy vehiclesClosed management of exhaust gas
puri?cation
Slaughtering (Scope 1, 2)
Green factoryPhotovoltaic power generationWaste heat recoveryLightweight packaging
Planting (Scope 3)Reduced use of fertilizers
Grain transportation(Scope 3)
Optimized transportation structureLocalization of grain procurementPromotion of new energy vehicles
Around the Company's carbon reduction goals and strategic planning, Muyuan has outlined the carbon reduction path andkey measures for the entire life-cycle of pork. At the current stage, the focus is on reducing carbon emissions in Scope 1 (directemissions) and Scope 2 (indirect emissions).Whole Life-cycle Low-carbon Action
Logistics (Scope 3)
Dedicated transportationIncrease of vehicle full loading rate
Consumers (Scope 3)Green products
Low Carbon Technology Innovation and ApplicationLow-soybean meal DietsThe Company is committed to researching low-soybean meal diets, tailoring optimal nutritional requirements for differentbreeds, growth stages, and types of pig groups. Through variable frequency mixing technology, it establishes dynamicallyadjustable nutritional ratios to meet the nutritional needs of pig groups while reducing the use of soybean meal. This approachavoids excessive intake of protein and reduces greenhouse gas emissions.In 2023, the Company's soybean meal consumption ratio further decreased from 7.3% in 2022 to 5.7%, signi?cantly lower than theindustry average of 13%. This reduction is equivalent to saving 31.20kg of soybeans per pig, reducing nitrogen emissions by 80,700tons, and reducing greenhouse gas emissions by 146.6 thousand tons of CO
e.
146.6
GHG emissions reduction
thousand tons of CO
e80,700Nitrogen emissions reduction
tons
Pig House Heating without Fossil Fuels
To reduce heating energy consumption, the Company has developed and implemented pig house heating without fossil fuels. Byinstalling insulation boards on the walls of pig houses and implementing heat exchange for incoming and outgoing air, the heatfrom exhaust gases is recovered, reducing heat loss in the pig houses. This initiative reduces the consumption of natural gas andcoal for winter heating from the source, achieving energy savings and emission reductions. In 2023, this resulted in a reductionequivalent to 333.5 thousand tons of standard coal usage and a decrease of 867 thousand tons of CO
e greenhouse gas emissions.
333,500Standard coal usage reduction
tons867,000GHG emissions reduction
tons of CO
e
041042
Energy Management
207.9
Cumulative installed capacity
MW
117.4
Newly added installedcapacity in 2023
MW
36.884
Total electricity generation in 2023
million kWh15,200Reduction in GHG emissions
tons CO
e
To further promote clean production, the Company fully utilizes the roof resources of its farms/factories to build distributedphotovoltaic power generation facilities, advancing the large-scale development of solar power generation. This is achievedthrough a model of low-voltage grid connection, self-use, and surplus electricity grid connection, which reduces the consumptionof fossil energy. Muyuan has established a new energy company to integrate upstream and downstream advantages of the newenergy industry and promote photovoltaic power generation.As of the end of 2023, the Company has constructed rooftop distributed photovoltaic power generation facilities in 41 farms, witha cumulative installed capacity of 207.9 MW. Among these, the newly added distributed photovoltaic power generation installedcapacity in 2023 was 117.4 MW, with a total electricity generation of 36.884 million kWh from January to December 2023, resultingin a reduction of 15.2 thousand tons of CO
e greenhouse gas emissions.
Distributed Photovoltaic Power Generation
890,400Annual ElectricityOutput
kWh
2.779
Commissioned Photovoltaic PowerStations
MW
567.09
Reduction inGHG Emissions
tons CO
e
In November 2023, the Photovoltaic Power Generation Project in Suiyang Farm No. 5, Henan, with a capacity of 2.779 MW, wascommissioned. During this reporting period, the project generated an annual electricity output of 890,400 kWh, resulting in areduction of 567.09 tons of CO
e greenhouse gas emissions.
Aerial View of the Photovoltaic Power Generation Project in Suiyang Farm No. 5, Henan
Photovoltaic Power Generation Project in Suiyang Farm No. 5, Henan
Extending application
Muyuan actively explores comprehensive ways to utilize biogas, whereby biogas generated from livestock manure undergoesdehydration and desulfurization puri?cation before being transported to feed mill boilers, harmless treatment workshop boilers,biogas generators, and other equipment for utilization. In 2023, 30 new biogas utilization projects were established, including9 biogas power generation projects, with a cumulative installed capacity of 16MW and an annual maximum power generationcapacity of 84.24 million kWh. Throughout 2023, the total biogas utilization amounted to 34.45 million m?, saving 22.39 million m?of natural gas and reducing greenhouse gas emissions by 1.8378 million tons of CO
e.
Biogas Utilization
34.45
Biogas Utilization
million m?22,39Natural Gas Saved
million m?
1.8378
Reduction in GHG emissions
million tons CO
e
In 2023, a biogas purification project was initiated in theNeixiang Complex, employing Pressure Swing Adsorption(PSA)technology to purify biogas generated from the livestock farminto biogas with a methane content of over 96%. The puri?edbiogas, now classi?ed as bio-natural gas, is transported by tanktrucks to surrounding feed mills for combustion. This projectproduces 3.85 million m? of bio-natural gas annually, saving
4.675 thousand tons of standard coal.
3.85
Annual Production ofBio-natural Gas
million m?4,675Standard Coal Saved
tons
The Company actively promotes the replacement of fuel vehicles with electric vehicles for operations such as disinfection, pigtransfer, and product transportation, etc. In 2023, over 560 fuel vehicles were replaced with electric transport vehicles.Adoption of New Energy Vehicles
The supply of feed to the farms is optimized by transporting feed from centralized storage tanks to pig feed troughs throughthe feed chain, replacing traditional vehicle transportation. This not only reduces transportation energy consumption but alsodecreases feed dust emissions.Feed Pipeline Transport
The primary energy consumption of the Company comprises electricity and natural gas. It actively promotes energy-savingtechnology innovation and the application of energy-saving equipment to reduce energy consumption. Additionally, it establishesan Internet of Things（IoT）platform to monitor and ?nely manage energy consumption data in real-time through an energyconsumption detection system. This enhances energy utilization efficiency and reduces energy consumption. In 2023, theCompany's energy consumption intensity was 0.1975 kg of standard coal/kg pork, representing a 12.96% decrease compared to theprevious year.
Energy Consumption Monitoring and Management
Biogas Puri?cation Project in Neixiang ComplexTechnical Application
043044
Muyuan actively promotes the establishment of greenfactories. Our Neixiang Slaughterhouse has been awardedthe national-level Green Factory certification, and we willcomprehensively promote the establishment of green factoriesthroughout our slaughterhouses. Additionally, we will activelyparticipate in the development of the group standards for zero-carbon factories in Henan Province, aiming to facilitate theimplementation of zero-carbon factory projects.
Establishment of Green Factories
IndicatorUnit202320222021DieselLiters79,547,301.7981,893,303.6570,072,490.09GasolineLiters14,082,124.5512,061,076.1518,417,548.36GasCubic Meters124,220,654.99218,839,075.60129,469,790.60ElectricityConsumption
MWh6,045,117.825,142,753.024,328,154.29Total EnergyConsumption
Tons of Standard Coal1,006,482.281,010,437.76793,881.24Energy Intensitykg Standard Coal/kg Pork0.19750.22690.2114
Waste Gas Management
The Company innovatively employs air ?ltration systems in pig houses, with sterilization and deodorization systems installed atthe outlet. The waste gases generated during farming and slaughter processes are collected through a gas collection pipeline andpuri?ed by this system, achieving a 97.3% removal rate of ammonia. In 2023, there was a total reduction of 26.7 thousand tons ofammonia emissions, equivalent to reducing greenhouse gas emissions by 125.2 thousand tons of CO
e.
Sterilization and Deodorization
97.3%
Ammonia Removal Rate
26,700Cumulative Reduction of AmmoniaEmissions
125,200Reduction of GHG Emissionstons
In 2022, Muyuan, in collaboration with the Henan Provincial Department of Agriculture and Rural A?airs and the Departmentof Ecology and Environment, proactively publicized waste gas puri?cation technology. Muyuan promoted the construction ofammonia emission reduction facilities in large-scale enclosed livestock and poultry houses, contributing to achieving the target ofreducing ammonia emissions from large-scale farms in Henan Province by 5% compared to 2020 levels.
Publicize waste gas purification technology to assist the industry inreducing ammonia emissionsTechnology Promotion
tons of CO
e
The Company implements fully enclosed management for all pig houses and farms' environmental facilities. It introducedinnovative air-?ltered pig houses, where gases emitted inside the pens are collected, sterilized, and puri?ed. Waste is transportedin a sealed manner and directed to HDPE black membrane anaerobic lagoon, effectively reducing GHG emissions duringproduction and waste treatment processes.
Fully Enclosed Management
Carbon Sequestration in Farmland and Reduction of Fertilizer Usage
The Company implements crop-livestock cycle, where waste generated during pig farming is managed based on the principleof "production with reduced wastes, harmless treatment, resource utilization and ecological recycling". This model constructs acircular economy pattern that features mutual bene?ts between pig farming and crop planting, reducing emissions of gases likeammonia and methane and creating a low-carbon sustainable agricultural industry chain.In 2023, Muyuan established seven agricultural research and development bases in provinces including Henan, Hebei,Heilongjiang, Jiangsu, and Guangxi, to explore green and low-carbon emission reduction pathways and promote low-carbondevelopment in agriculture.
In 2023, through resource utilization, Muyuan applied organic fertilizer to a total area of 4.5207 million mu(301,380hm?), replacinga cumulative total of 146.8 thousand tons of chemical fertilizers. This led to a 6.76% increase in soil organic matter and a total soilcarbon sequestration of 1.3482 million tons of CO
e.
Crop-livestock cycle
Crop-livestock Cycle Demonstration Field in Guannan County, Jiangsu
4.5207
Area of OrganicFertilizer Application
million mu146,800Cumulative Replacement ofChemical Fertilizers
tons
6.76%
Increase in SoilOrganic Matter
1.3482
Total Soil CarbonSequestration
million tons of CO
e
Muyuan actively responded to the State Council's 2023 "Action Plan for Continuous Improvement of Air Quality" by proactivelypublicizing waste gas puri?cation technology to help the industry reduce ammonia emissions.In 2023, Muyuan assisted in the upgrading and transformation of waste gas puri?cation in large-scale farms in Huaibin County,Henan Province, and in Guangxi State Farms. This e?ectively reduced dust (PM10, PM2.5) in the exhaust air and reduced GHGemissions such as N
O.
045046
Low-carbon TransportationWe're actively advancing local procurement practices to cut down on lengthy transportation routes. In 2023, our locally sourcedgrain procurement accounted for 89%, marking a 4.87% increase from the previous year.We're streamlining the transportation of raw materials by implementing multi-modal solutions for distances exceeding 500kilometers. This includes ramping up our reliance on inland waterways and railways. In 2023, maritime shipments totaled 958,800tons, while railway transportation amounted to 612,500 tons, collectively constituting 39.19% of our self-transportation volume. Byreducing road transport by 1,571,300 tons, we've also curbed GHG emissions by 824,000 tons CO
e.Moreover, at the pivotal logistics hub of Zhoukou Port, we're spearheading the transition to new energy semi-trailers, a pilotinitiative that's proven successful. Looking ahead, we're planning to scale up this e?ort with a ?eet of 300 new energy vehicles.
Low-carbon PackagingMuyuan actively promotesthe adoption of bulk rawmaterial procurement. In2023, the bulk procurementof raw materials accountedfor 94.41%. The bulk deliveryof feed amounted to 21.5442million tons, with a bulkdelivery rate of 99.99%.
Bulk FeedAdoption
Muyuan optimizespackaging standards byadjusting dimensions andreducing plastic thickness,minimizing unnecessarylayers and material usage.
OptimizedPackaging Design
Muyuan employsenvironmentally friendlymaterials such as PPand PE to replace PVC,facilitating resourcerecycling.
Launch of Recycling
Programs
Muyuan enhances plasticquality management toreduce waste. Transitioningfrom flatbed trucks tohigh side trucks for cratetransport decreases the riskof scrap and minimizes theuse of wrapping ?lm duringtransportation.
Supply Chain Packaging
Management
Low-carbon Life
Recognizing the value of resources and the e?ort behind labor, Muyuan actively promotes the Empty PlateCampaign across the Company, fostering a culture of food conservation. This initiative includes displayingslogans promoting clean plates in dining areas to encourage all sta? to participate. Additionally, a empty platemanagement system has been established, implementing joint assessments among diners, food service sta?,and chefs. A Empty Plate Action Group has been formed for public oversight.Table Leaders are responsible for meal ordering, paying a deposit for finishing all dishes, promoting theempty plate culture, and encouraging everyone to participate. Deposits are refunded if all dishes are eatenup, or, if not, the deposit will be deducted based on how much was wasted. Encouraged by Muyuan's e?orts,some industry peers have also started the Empty Plate Campaign.
Empty PlateCampaign
Employees are encouraged to carpool and purchase electric vehicles. Charging stations are installed inthe office area to support new energy vehicle infrastructure, reducing carbon emissions from employeecommuting.GreenCommuting
Green O?ceWe vigorously advocate for green office practices to reduceo?ce supplies and energy consumption. This includes utilizingvarious online o?ce and collaboration systems such as SmartMuyuan and Muyuan's intelligent platform for remote work.We collaborate with third-party travel agencies, opting forcorporate-paid business trips to reduce travel invoice printingand unnecessary travel. Employees are encouraged to printdouble-sided or reuse single-sided paper to increase paperutilization. Electronic signatures are promoted (with 300,000instances in 2023). Practices such as unnecessarily leavinglights, taps, and electronic devices on are strictly discouraged.Air conditioning is set to 25℃; heating or air conditioning isnot used with windows open; during peak hours, to improveenergy e?ciency, elevators won't stop at certain ?oors.
The Company pays close attention to the impact of climate change on human society and the livestock industry, integratingclimate risks into its overall risk management framework. Based on the e?ects of climate change on business operations, weidentify and analyze potential impacts and corresponding mitigation measures under climate risks (physical risks and transitionrisks).
Risk Management
Physical Risks and Response MeasuresRisk Description Risk ResponseExtreme cold weather leads to:
·Increased risk of spreading pathogenic microorganisms andinfecting pigs.·Adjustments in pig house temperature, resulting in increasedenergy consumption.·Water sources freezing, limiting pigs' access to water.·Impact on the storage and supply of feed, affecting thefeeding e?ectiveness of pigs.
·Enhance disease prevention and control measures tosafeguard pig health.·Develop smart environmental control systems for preciseregulation, ensuring consistent conditions year-round.·Implement insulation measures to prevent water sourcefreezing.·Establish emergency plans to address risks.Extreme hot weather leads to:
·Increased risk of heat stress in pigs, resulting in reducedappetite and hindering their growth and development.·Elevated water demand for pigs, and insufficient watersupply can impede pig growth.·Persistent high energy consumption to upholdenvironmental conditions.
·Develop smart environmental control systems for preciseregulation, achieving year-round stable conditions.·Strengthen water source monitoring and supply to ensureanimal drinking and production water.·Establish emergency plans for risks.Heavy rainfall leads to:
·Pollution of water sources near the farms, impacting piggrowth and health.·Damage to production facilities, resulting in economiclosses.·Floods caused by heavy rainfall may lead to low-lyingbreeding facilities being submerged, resulting in losses in?xed assets and pig mortality.
·Prioritize selecting higher ground for farm locations,enhance farm drainage system construction, and reduceimpacts on pig farms.·Regularly test water quality in farming areas and inspect andmaintain facilities.·Develop ?ood prevention plans, conduct personnel training,and strengthen ?ood prevention material preparation.Typhoons leads to:
·Damage or destruction of facilities, leading to the risk of pigsescaping or dying.·Interruption of the supply chain, affecting productionoperations.
·Create emergency plans, including safe evacuation plans andurgent maintenance for facilities when typhoons approach.·Purchase catastrophe insurance to mitigate economic lossesfrom risks.Biodiversity loss leads to:
·Impaired crop pollination, pest control, and otheragricultural processes, negatively a?ecting agriculturalproduction and feed supply.·Disruption of ecosystem services, increasing the risk ofdiseases.·Disturbance of aquatic ecosystem balance, thereby a?ectingwater quality and supply.
·Increase innovation in R&D, diversifying feed sources.·Enhance disease prevention and control e?orts to improvepig health.·Promote sustainable development of ecological and circularagriculture to maintain ecosystem health.·Conduct regular environmental monitoring and assessmentto promptly identify and address potential environmentalissues.
047048
Alongside identifying climate risks, we also evaluate the opportunities arising from climate change and implement correspondingresponse measures.
Transition Risks and Response Measures
Transition Opportunities and Response Measures
Risk Description Risk ResponsePolicy and Legal Risks
·National energy structure shifts towards non-fossil energysources;·Charging fees to carbon emitters to encourage them to prioritizelow-carbon production and reduce carbon emissions.
·Actively promote the use of renewable energy such as photovoltaicpower generation and biogas utilization;·Actively innovate energy-saving technologies to reduce energyconsumption and emissions;·Conduct "Green and Low-Carbon Benchmarking" activities topromote green and low-carbon production.Technology Risks·Business development shifts towards low-carbon farming, but thetechnology is immature;·Increased ?nancial investment in low-carbon technology researchand equipment transformation.
·Participate in national and industry key low-carbon researchprojects, improve the pork production technology system, andpromote the industry's low-carbon and green upgrading;·Strengthen exchange and cooperation to promote comprehensiveenergy solutions.
Market Risks·With the increasing environmental awareness among customersand consumers, the low-carbon and environmental attributes ofproducts may become a new criterion for choices.
·Carry out energy conservation and emission reduction throughoutthe entire life cycle, actively provide environmentally friendlyproducts that consumers can understand;·Strengthen sales-side training to enhance their understanding ofthe Company's low-carbon work progress and performance, thusaccurately conveying to customers.
Reputation Risks·Stakeholders pay more attention to the Company's responseto climate change. If the Company's related work fails to meetexpectations and respond to stakeholders' concerns timely, it maya?ect the Company's reputation.
·Establish a Sustainable Development Committee and a Greenand Low-Carbon O?ce, with senior management's attention andpromotion of climate change-related work;·Actively publish ESG reports and Green and Low-carbon Actionreports, systematically disclose the Company's latest actions inaddressing climate change, natural resource consumption, andother issues.
OpportunityDescription
Response Measures
ResourceE?ciency
We actively promote clean production and energy-saving technologies, vigorously develop renewable energy sourcessuch as solar and biomass energy, reducing fossil fuel consumption, operational costs, and driving sustainableindustry development.ExploreAgricultureCarbon SinkMechanism
By implementing integrated crop-livestock systems, we explore agricultural carbon sink projects, aiming to reducegreenhouse gas emissions and enhance carbon sequestration capacity through green and low-carbon agriculturalpractices.Adaptability
The Company actively addresses climate change risks by exploring green technologies, reducing reliance on naturalwater resources, enhancing resilience, achieving high-quality development, and seizing broader developmentopportunities in line with national policies and socioeconomic trends.
Enhance ProductValue
We enhance green product innovation, elevate product ethical value, to better win consumer recognition in thefuture, and enhance product competitiveness.Brand Value
We continuously strengthen the disclosure and promotion of sustainable production, environmentally friendlyfarming methods, and other aspects to build a positive brand image.Business Model
We research diverse protein products and markets to create healthier, more nutritious food. This includesoptimizing feed, developing plant-based supplements, and exploring alternatives like plant, microbial, and insectproteins.We broaden our business to counteract climate change's impact, such as boosting organic fertilizer output andutilizing biomass energy.
Emission Reduction Indicators and TargetsIndicator2023 Performance2023 Target Value2024 Target Value
Photovoltaic Power Generation (10,000 kWh)3,688.441,800.5125,000.00
Biogas Utilization (10,000m?)3,445.073,413.565,702.00Biogas Power Generation (10,000 kWh)1,667.761,500.002,126.00
Greenhouse Gas Emissions in the Past Three Years
Accounting Scope202320222021
Scope 1 Emissions (10,000 tons CO
e)416.47389.45307.65Scope 2 Emissions (10,000 tons CO
e)381.54340.56283.54Total Carbon Emissions (10,000 tons CO
e)798.01730.01591.19Carbon Reduction (10,000 tons CO
e)331.12319.72251.06Net Carbon Emissions (10,000 tons CO
e)466.89410.29340.13Carbon Intensity (kg CO
e/kg Pork)0.9640.9981.049
Note: The Company promotes low-soybean meal diets, pig house heating without fossil fuels, and photovoltaic powergeneration, e?ectively reducing GHG emissions by 1.0288 million tons of CO
e. If we include the reduction value of thisemission reduction and that in the production process, the total carbon emission reduction in 2023 amounts to 4.34 milliontons of CO
e.
Indicators and TargetsThe Company conducts carbon footprint verification in accordance with the ISO 14064 standard and the "2006 IPCCGuidelines for National Greenhouse Gas Inventories" published by the United Nations Climate Change Committee. Eachyear, the entire industry chain, including feed processing, pig farming, meat processing, and waste treatment, undergoesGHG accounting. Annual carbon intensity targets are established and the achievement of these targets is tracked.In 2023, the carbon intensity was 0.964 kgCO
e/kg pork, representing a 3.4% reduction compared to the previous year.
0.964
Carbon Emissions per kg Pork
kgCO
e
3.4%
Decrease Compared to Previous Year
049050
Muyuan consistently practices green development, adhering to the principle of "never pass on costs, never shirk responsibilities,and never leave hidden dangers," It strictly complies with national environmental laws and regulations, setting ?ve environmentalprotection goals of "zero emissions, no hidden dangers, no odors, smog reduction, and carbon emission reduction". Wecontinuously enhancing our environmental management system, promoting clean production, strengthening wastemanagement, and persistently reducing environmental impact.
Green Production
Environmental Management SystemOrganizational Responsibilities
Institutional Safeguards
Environmental Logistics Department：Responsible for overall environmental management, and the Department comprises
Ecological and Environmental Technology Division and other three levels of environmental management: regional, subsidiary,and site.Ecological and Environmental Technology Division: Innovates and applies environmental technologies, provides guidance andtraining, and enhances operational e?ciency.
Provincial Environmental Logistics Department: Formulates regional plans, supervises compliance, and ensures adherence toenvironmental policies.
Subsidiaries and Sites: Ensure the compliance with environmental standards and regulations.Environmental Monitoring Department: Directly reports to the Board of Directors, and acts as an independent oversight body.Through its six inspection divisions, it continually monitors and supervises environmental practices across Company regions andsites. It regularly reports to the Board to ensure compliance with environmental policies and standards, thereby enhancing overallenvironmental operational e?ciency.
To mitigate environmental risks in production operations and enhance environmental governance performance, the Companycontinuously improves its environmental management system. Currently, 26 management protocols have been developed,including those for environmental risk identi?cation and management, environmental operational standards, and environmentalinspection management. Additionally, environmental operational management is integrated into the assessment and evaluationof relevant personnel and sites to ensure environmental compliance throughout production and operations.Standards:
Environmental Compliance Risk Identification and Management Standard, Environmental Operational QualityManagement Standard, Benchmarking Standard for Environmental Operation Evaluation, etc.Protocols:
The Environmental Protection Operation Management System, Water Pollution Control Procedures, Solid WastePollution Control Procedures, Harmless Disposal of Dead Pigs Management Protocol, Hazardous Waste Management Protocol,Supporting Agricultural Network Management Protocol, Environmental Red-Yellow Card System,etc.Contingency Plans:
Emergency Response Plan for Sudden Environmental Incidents
Empowerment and Certi?cation
Environmental Investment and Innovation
In 2023, the Company organized over 550 environmental protection training sessions, carried out systematic environmentaltechnology certifications for 34 items, and empowered training certifications for 7,860 individuals. This effort ensuredthe implementation of environmental laws and regulations, operational standards, technological processes, and relevantenvironmental cases among frontline sta?. It enhanced their awareness of risks and compliance while improving their technicalcapabilities, ensuring that high standards of environmental requirements were implemented at every site.
The Company continues to increase its investment in environmental upgrades to enhance environmental governanceperformance. In 2023, a total of 1.056 billion RMB was invested in upgrading environmental processes and supporting agriculturalnetwork construction.
Resource utilization pathways for 2 crops were newly developed, bringing the total number of crops to 39.Resource Utilization Technologies
Tailored liquid fertilizer application methods are employed based on di?erent terrain and crop types to ensure precision anduniformity, thereby enhancing the e?ectiveness of biogas slurry application.
Biogas Slurry Recycling Methods
The application of simultaneous partial nitrification and denitrification (SPND) achieves rapid degradation of organic matterwhile e?ectively controlling total nitrogen in e?uent. Ammonia nitrogen is converted into nitrate nitrogen fertilizer, mitigatingrisks without reducing fertilizer e?ciency.Livestock Manure Treatment
Biogas from livestock farms is puri?ed to produce biogas with methane content exceeding 96%, reducing fossil fuel consumptionand aiding carbon emission reduction e?orts.Biogas Puri?cation Project
Water resources are vital for the Company's production and operations. The Company places great importance on water resourcemanagement and upholds the commitment to "sustainable water use." It identifies water resource risks and has developedthe Livestock Farm Standard Water Management System, Livestock Farm Water Quality Sampling Management System,Slaughterhouse Water Conservation Management Measures, Slaughterhouse Water Conservation Incentive and Penalty System,and Water Monitoring Equipment Operation and Maintenance Management System. Innovative water-saving technologies areapplied, and water usage monitoring is strengthened to promote re?ned water management and mitigate water risks.
The Company's Operations Management Department oversees water management activities, led by senior executives whoformulate annual water conservation goals, plans, and performance management. The Water Resources Management SpecialGroup is responsible for researching and promoting water-saving technologies and equipment, devising water-saving measuresfor various water usage points, and organizing water management training and empowerment.
Water Resource Management
Management Structure
051052
Environmentally Friendly Development
Water Consumption Pathways
Organizational Structure for Water Resource Management at Livestock Farms
Head of Operations Management Department
Head of Environmental Management
Head of Water UsageTechnology
Head of Sewage Disposal& Pen Brushing
Water Management Project TeamFrontline Water Management Team
Farm Water andElectricity PersonnelCaretaker
Manager
Regional teams, subsidiaries, and site-speci?c water management teams are responsible for implementing the Company's goalsand plans. They have to promote the adoption of water-saving technologies and upgrade water-saving equipment to ensure thee?cient operation of water facilities and standardized water usage practices without waste.
Adhering to the concept of water recycling, the Company focuses on water footprint and conducts comprehensive water resourcemanagement across the entire business chain to improve water resource utilization e?ciency and conserve freshwater resources.In the crop-livestock cycle model, water resources are reused throughout the business chain. Freshwater enters the pig farmingsystem and is used for pig drinking water, environmental cleaning, cooling, and odor removal, ensuring healthy pig growth andproviding high-quality pork products to society. Simultaneously, the wastewater generated from livestock farming becomes liquidfertilizer for crop cultivation, achieving 100% resource utilization and saving agricultural irrigation water.
Water Utilization Pathways
reclaimedwater reusefarmsfreshwater
biogas slurry
processing
water taken away by pigs
water loss
agricultural
irrigation
Farm & Unit
Manager
Head of Water and Electricity
Maintenance
To ensure the rational utilization and protection of water resources and achieve sustainable development, the Company hasestablished short-, medium-, and long-term water usage goals, which are further broken down into annual targets for variousbusiness processes and managed on a quarterly and monthly basis. By promoting technical innovations for water conservationand enhancing water management practices, the Company aims to achieve its water-saving objectives. Progress towards water-saving targets is integrated into the performance evaluations of each site manager and relevant personnel, with regular disclosuresof water-saving achievements and any instances of excess water consumption to strengthen awareness and standardize waterusage practices, thereby conserving freshwater resources.
Water Resource Management
Innovative Water-Saving Technologies
Implementing crop-livestock cycle to utilize biogas slurry generated from farming activities for crop irrigation, reducing the needfor freshwater irrigation and promoting a closed-loop water system between farming and planting.
Crop-livestock Cycle and Water Conservation
Developing and deploying technologies for the puri?cation and reuse of wastewater, including technologies for purifying manurewater, recycling washing water, and harvesting rainwater. Treated wastewater is reused for odor control and cleaning pig pens,signi?cantly reducing the demand for freshwater. As of the end of 2023, puri?cation processes have been implemented in 277farms, with an annual reuse volume of 3.7072 million m
.
Reclaimed Water Reuse Technology
The Company has independently developed an intelligent feeding system, which utilizes smart mixing, feeding, and water supplymechanisms to ensure precise water intake by pigs, thus avoiding water wastage during the feeding process.Intelligent Feeding Technology
Installing automatic inlet valves to reduce water wastage from pressurized water tanks, saving approximately 90 tons of water permonth. Around 1,000 sets have been deployed.
No Tower Water Tank Upgrades
Upgrading sprinkler systems with automatic vent valves to prevent water wastage caused by delayed shut-o?, resulting in watersavings of 3 liters per unit per spray. Approximately 5,000 sets have been deployed.Sprinkler System Upgrades
Introducing water-saving bathroom ?xtures that reduce water consumption to one-third of normal usage, e?ectively reducingwater usage during sanitation activities.Intelligent Bathrooms
By employing techniques such as "loosening instead of plowing," "rotary-till instead of plowing," "retention of high stubble for no-till planting," and "close-stubble no-till direct planting," water retention capacity can be enhanced and reduce the water loss dueto runo?.Soil Moisture Retention Techniques
053054
To comprehensively understand the water usage dynamics at various process, stages and water supply facilities, we haveinstalled remote metering devices in each unit and at each stage of farming. This allows us to classify and monitor waterusage levels. Currently, we have deployed 2,833 water monitoring points in our water resource management system.This enables us to conduct online monitoring, analysis, ranking, early warning, improvement, and test of daily waterusage in pig farms, providing reliable data support for making scientifically informed water management decisions.
We utilize the Muyuan Internet of Things (IoT) platform to digitize water resource management. This platform integratesintelligent feeding, smart water management, and other services. It facilitates data interoperability between feeding and watermanagement systems, enabling tracking and early warning of water usage, pollution generation, and reuse through manual inputand automatic data collection. This continuous monitoring and analysis help us to reduce water consumption e?ectively.
Strengthen Water Management
Smart Water Management System
The Company has established a water resource risk assessment system to comprehensively evaluate the water reserves and waterquality around the farms. This includes mapping water quality and water risk levels and implementing graded management.Based on water resource endowment, the Company determines farm locations and scales to ensure su?cient water supply forproduction. Additionally, a new groundwater monitoring system has been installed to provide early warning and take preventivemeasures in areas where groundwater levels are declining, so as to mitigate the impact of water shortages caused by extremeweather events or river water cuto? on farm water usage.
Water Risk Management
Water Resource Risk LevelsRisk levelStandard
Level 1
Water-scarce areas, prohibited extraction zones, and quantity-oriented water-deficient areascannot meet current water demand.Level 2
Restricted extraction areas, water quality-oriented water-deficient areas, and regions withunstable water sources (such as intermittent drying up of well water and o?-site drinking water)face the risk of water shortages at any time.Level 3
While the water source is stable, its temporal distribution is uneven. Additional water sources areneeded to supplement water demand during peak usage in summer.Level 4Abundant water area, su?cient water source, no risk.
In the summer, the water usage in the Neixiang Complex is relatively high. To conserve freshwater resources resources, a long-term water-saving mechanism has been established. The Company has designated personnel responsible for water management.During the raising process, reclaimed water reuse technology is employed, and regular inspections are conducted to addressany leaks or water wastage issues. The source of wastewater is traced, and reduction plans for end pollution are formulated,with water-saving incentives and penalties implemented. Regarding end-use, based on the water requirements of agriculturalcrops, biogas slurry is used for farmland irrigation, achieving the recycling of water. Through these measures, the annual waterusage decreased by 1.9236 million cubic meters in 2023, achieving the dual goals of water resource conservation and pollutionreduction, continuously improving water resource utilization e?ciency, and reducing water usage risks.
Water Management of Neixiang ComplexPractice Achievements
Freshwater 67%Recycled water 33%
Businessuse
For pigdrinking
Forenvironmentalcontrol
Forproduction
For penbrushing anddisinfecting
Topdressingfor cornBasal dressingfor cornTopdressing for
wheatBasal dressingfor wheat
Biogas slurry
Reusetechnology
EvaporationCarrying away
by pigs
7%
67%70%90%95%93%
5%10%30%26%
47.5%29.9%17.6%5.0%33%
35%
30%30%20%20%
To ensure the safety of drinking water for pigs and reduce water usage risks, Muyuan has installed water quality monitoringequipment. It conducts monitoring assessments of water quality at each site, creates water quality maps, and develops targetedmanagement plans based on di?erent water qualities. At the same time, to ensure water quality stability, in addition to traditionalmethods such as coagulation, sedimentation, and sand ?ltration, the farm has incorporated ultra?ltration technology into itswater treatment process. With a ?ltration accuracy of 30nm, the ultra?ltration system e?ectively removes solid particles from thewater, and can even intercept most bacteria and some viruses, ensuring the health and safety of drinking water.
Performance and Objectives of Water Resource Management
Index
2023Performance
2024Target Value
Average water intensity per pig for
raising (m?/head)
2.252.21
Average water intensity per pig forslaughtering (m?/head)
0.370.35
Water intensity for feed processing
(m?/ton)
0.130.125
Index
2024Target Value
Water consumption for pig
raising (10,000 m?)
17,030Wastewater reuse
(10,000 m?)
Irrigation water saving
(10,000 m?)
9,366
Fordomesticwater use
055056
Waste ManagementMuyuan actively conducts emissions management, proactively identi?es environmental impact factors at each stage, reduces thegeneration of emissions from the source, and rigorously controls wastewater, exhaust gases, and solid waste generated duringoperations to ensure all emissions are compliant.
Muyuan's environmental protection facilities for farming mainly include odor removal, solid-liquid separation, anaerobicfermentation, biogas slurry storage, and agricultural irrigation pipeline networks. To ensure the normal operation of thesefacilities, over 9,000 inspections covering farms, feed mills, harmless treatment facilities, and slaughterhouses were conductedin 2023. Additionally, 224 comprehensive environmental technology empowerment certi?cations were organized, achieving a100% coverage rate, to comprehensively guarantee stable and e?cient operation of the facilities and equipment. Furthermore, wehave carried out a series of technological innovations to improve the e?ciency and intelligence level of environmental protectionequipment.
Operation and Management of Environmental Protection Equipment
Names ofEnvironmentalProtection Facilities
Innovative E?ciency-Improving MeasuresE?ciency Indicators
Sterilization anddeodorizationsystem
An innovative application of odor neutralizers with precise targetedaddition plan has been developed, achieving precise and targeteddosing of odor neutralizers and reducing odor neutralizer consumptionby 30%. Pilot testing has been successfully completed.
Ammonia removal rate> 97%, sterilization rate> 99%.Aerationbiochemicalsystem
An innovative application of simultaneous partial nitrification anddenitrification has been developed, enabling precise control ofdissolved oxygen and sludge retention time. This process convertsammonia nitrogen into nitrate nitrogen fertilizer, reduces aeration tankretention time by 50%, saves 50% in infrastructure costs, and decreasesaeration energy consumption by 25%. Promotion has already begun.
Processing e?ciencyincreased by 100%,saving energyconsumption by 2.69kWh per pig
Biogas slurryland applicationsystem
Remodeled and optimized the configuration of booster pumps,pipelines, and pump units, and split the original inefficient pipenetwork, increasing the effective utilization rate from 89% to 93.8%;Developed and applied various irrigation methods such as reel-typesprinklers, stand pole rocker arm nozzles, electrically driven dragirrigation, and ground-inserted sprinklers to improve biogas slurryapplication accuracy and e?ciency, covering 277 farms.
Pipeline networkutilization e?ciencyis 93.8%, with a 50%reduction in laborusage.Harmlesstreatmentsystem
The equipment has been upgraded for intelligent automation, withadded automatic control, automatic data collection and remotetransmission, automatic alarm for risk and faults, etc. These functionshave improved production efficiency and reduced labor intensity foremployees. 20% of the upgrades have been completed.
Labor intensityreduced by 50%;Energycost savings of 40 yuanper ton of material
Solid-liquid separation facilitiesBlack membrane anaerobic lagoonDeodorization facilitiesBiogas slurry land application facilities
In the management of livestock waste, the Company implements a crop-livestock cycle model, constructing a ecological recyclingthat features mutual bene?ts between pig farming and crop planting through the practice of "production with reduced wastes,harmless treatment, resource utilization". In the pig raising process, solid and liquid waste are separated. Solids are processedinto organic fertilizer for sale, while liquids undergo harmless treatment and are used for nearby application, achieving zeroemissions. The Company pioneers odor control technology, implementing deodorization and sterilization processes across allfarms to manage emitted odors e?ectively. Furthermore, it shares waste air puri?cation technology with the industry to promotemutual development.
Management of Livestock Waste
Waste categoriesSources of wasteWaste treatment methods
Wastewater
Livestockwastewater
Animal urine/feces,wastewater fromcleaning during pig
raising
Resourceutilization
Livestock manure undergoes solid-liquid separationfollowed by anaerobic fermentation (HDPE membrane)treatment. After passing the inspection, it is used as biogasslurry. Scientific soil testing and formulation are appliedin farmland, achieving resource utilization and zeroemissions.Puri?cationand reuse ofwastewater
Livestock wastewater undergoes solid-liquid separation,anaerobic fermentation, AO (Anaerobic Oxic) process, andmembrane treatment. After disinfection and sterilization,it is used instead of freshwater for odor control, cleaning,and disinfection in pig farms.
Domesticwastewater
O?ce, cafeteria,and other domesticwastewater
Resourceutilization
Centralized collection to the manure treatment area of thefarm, after harmless treatment, for resource utilization.
Wastegas
Odor
Gases producedduring the pig raising
process and duringthe collection andtreatment of manure
and urine
Sterilizationanddeodorizationtreatment
Innovative application of the new pig house with airfiltration, with waste gases passing through deodorizingwalls for sterilization and deodorization treatment,achieving a deodorization rate of over 99%, ensuring odorlessness (Grade 0) without disturbing residents.Biogas
The anaerobicfermentation processof manure produces
raw biogas
Resourceutilization
After desulfurization and dewatering treatment, it is usedfor power generation, replacing gas and other supplies forfarms and feed mills. Excess biogas will be ?ared.
Solid waste
Solidmanure
The solid fractionseparated by solid-
liquid separation
Resourceutilization
After composting fermentation in the farm, solid manureis transported externally and is produced into organicfertilizer foruse in the cultivation of fruits, vegetables, andother crops, achieving resource-based fertilization and zerodischarge.Diseasedor deadlivestockand poultry
The diseased or deadpigs during pig raisingprocess
Harmlesstreatment
Supporting harmless treatment plants are established,adopting the method of "temporary storage in the area- sealed transportation - full-process monitoring - datareconciliation - high-temperature rendering" to ensurezero loss of dead pigs, zero blind spots in supervision, zerospread of pathogens, and zero environmental pollution.Hazardous
waste
Medical waste, wasteUV lamps, and tubes
Entrustquali?ed units
for disposal.
Centralized collection and temporary storage of hazardouswaste, regularly entrusting qualified units for harmlesstreatment.Householdwaste
Household wastegenerated in o?ces
and daily life
Entrustquali?ed unitsfor disposal
Centralized collection and temporary storage, regularlyentrusting quali?ed units for disposal.
057058
Manure Fertilizer Utilization PerformanceIndex2023 PerformanceResource utilization rate of manure water (%)
Manure discharge volume (10,000 m?)0Amount of manure water reuse (10,000 m?)348.26Pig manure output (10,000 m?)74.14Solid manure resource utilization rate (%)
Harmless treatment rate of diseased & dead pigs (%)
Odor Management PerformanceAir before fourth-
stage ?ltrationOdor level: Level 0Ammonia (mg/m?): 0.0255*
Hydrogen sul?de (mg/m?):0.0028*Total particulate matter (pg/m?): 115.59*
VOC(mg/m?):/
Total number of bacteria (CFU/m?):/
Air outlet of pig houseOdor level: Level 4-5Ammonia (mg/m?):5.009Hydrogen sul?de (mg/m?): 0.46Total particulate matter (μg/m?): 191.4595VOC(mg/m?):0.00036Total bacteria count (CFU/m?): 210,000
Sterilized anddeodorized exhaust air
Removale?ciencyOdor concentration: Level 0Ammonia (mg/m?):0.13397Hydrogen sul?de (mg/m?):0Total particulate matter (μg/m?):1.5654
VOC(mg/m?):0.000041Total number of bacteria (CFU/m?): 45
99.9%
97.30%
100.00%
99.18%
89.00%
99.90%
Four-layer air ?ltration
Deodorizing wall
In the management of slaughterhouse waste, strict adherence to environmental regulations is ensured by setting controlobjectives and monitoring and managing the emissions of pollutants involved. Online monitoring devices are installed at themain wastewater discharge outlets to monitor the emissions of pollutants, and compliance status is publicly disclosed on the"National Pollution Discharge Permits Administration Information Platform" The Company conducts monthly comparisons ofdata from online devices to ensure their accuracy and reliability. Third-party testing companies are commissioned quarterly totest the water quality of the slaughterhouse's e?uent. For emissions, regular testing is commissioned by third-party testing unitsto ensure compliance with national and local standards for pollutant emission concentrations and total amounts.
Waste TypeWaste SourceProcessing
Wastewater
Productionwastewater
Wastewater fromslaughtering process,decontamination, etc.
Wastewater reuse +wastewater getting
into pipeline
Collected through pipe network to sewage treatmentsystem, using "grid + Grease trap + Regulating tank +Air flotation machine + Hydrolysis acidification tank+ Multi-stage AO + Secondary sedimentation tank +denitrification + disinfection tank" process to reachthe standard, some used for vehicle decontamination,slaughter room washing, greening, etc. for reuse.Therest is discharged to the municipal sewage treatmentplant for further treatment before being released intothe environment.Domesticsewage
O?ce, restaurant and
other life sewage
Slaughterhouse Waste Management
Pollution factorCODAmmonia nitrogenTotal nitrogenTotal phosphorus
In?uent concentration (mg/m?)855.9778.28104.2218.24E?uent concentration (mg/m?)25.660.665.200.35
Pollutant removal rate (%)97.0099.1695.0198.08
Slaughterhouse Wastewater Treatment Overview
Waste TypeWaste SourceProcessing
Exhaust gas
Odor from thelairage
Gases produced from pigrest and from collection
of pig waste
Collection andprocessing
The waste gas from the lairage uses the "deodorization wall +chemical spraying" method to remove ammonia,hydrogensulfide and other pollutants, the deodorization rate is morethan 99%, achieving no odor, no disturbance to others.Exhaust gasfrom sewagetreatment
station
Gases from the anaerobic
treatment process of
wastewater
Collection andprocessing
The waste gas from the sewage treatment station adopts"spray tower spraying + chemical deodorization" technology.The technology removes pollutants such as ammonia andhydrogen sul?de, with a deodorization rate of more than 99%.No odor, no disturbance to others.Exhaust gasfrom boiler
Natural gas combustion
Discharge aftermeeting emission
standards
The equipment adopts "ultra-low nitrogen combustiontechnology" steam generators. The exhaust gas can meetrelevant limit requirements in the national and local "Emissionstandard of air pollutants for boiler".
Solid waste
General solid
waste
pig hair and hoof shellsResource utilization
Recycled and pre-processed by an extruder, and then sold foruse in making protein feed.Intestinalcontents
Intestinal contents fromthe white o?al production
process
Resource utilization
After the water content is reduced by extrusion, it can be soldfor use in making organic fertilizer.Remainingsludge
Remaining sludge from
the sewage treatment
process
Resource utilization
After extruding and?tering to reduce the moisture content, itis sold for making nutrient soil, green manure, or earthwormfarming.Waste mineraloil
Waste mineral oil fromequipment maintenance
process
Entrust qualifed unitsfor disposal
Hazardous waste is temporarily stored in hazardous wasteroom and regularly entrusted to qualifed units for recyclingand disposal.Laboratorywaste
Waste from thelaboratory process
Entrust qualifed units
for disposal
Hazardous waste is temporarily stored in hazardous wasteroom and regularly entrusted to qualifed units for disposal.Household
waste
Raw waste of life and
work
Entrust qualifed units
for disposal
Domestic waste is collected and stored at temporary storagepoints and transported by the municipal authorities every dayto domestic waste treatment plant for processing.
Emission concentration (mg/L)CODAmmonia nitrogenTotal nitrogenTotal phosphorus
Emission Standards50.005.0015.000.50Muyuan Standard30.001.0015.000.302023 Performance*23.080.1611.500.12
Each slaughterhouse sets internal control standards for slaughterhouse wastewater, which are stricter than the requirements ofrelevant national standards. Taking Muyuan Meat Neixiang Slaughterhouse as an example, the actual concentration of wastewaterdischarged is far below the limits speci?ed in the GB 18918-2002：Discharge Standard of Pollutants for Municipal Waste-waterTreatment Plant.
The Performance of Wastewater Treatment in Neixiang Slaughterhouse in 2023Practical Achievements
* calculated by annual weighted average
059060
Slaughterhouse Wastewater Management PerformanceIndex2023 Performance
2023 TargetValue
2024 TargetValue
Wastewater discharge intensity perslaughtered pig (m?/head)
0.390.400.35COD emission intensity from slaughter
(t/kg pork)
0.0920.1000.085Ammonia nitrogen emission intensity in
slaughtering (t/kg pork)
0.00240.00300.0022
The Company has established an environmental risk management system, in accordance with the requirements of the DischargeStandard of Pollutants for Livestock and Poultry Breeding (HJ/T81-2001), Regulation on the Prevention and Control of Pollutionfrom Large-scale Breeding of Livestock and Poultry , Methods for Reviewing Animal Epidemic Prevention Conditions, TechnicalGuidelines for Zoning of Prohibited Areas for Livestock and Poultry Farming, and other relevant regulations. It conductsidenti?cation and management of hidden risks and hazards.
Environmental Risk and Hazard Management
Scienti?c Site SelectionBefore the construction of any farms, the Company conducts environmental impact assessments, selecting sites away from watersources, wildlife habitats, and basic farmland. This is done while considering environmental climate, hydrogeology, soil, andvegetation cover. There is su?cient arable land or forest land surrounding the site to serve as a natural barrier for the breedingfarms. Additionally, the manure produced by the farms is utilized for resource conservation on arable or forest land, achievingecological circular development.Site Leakage PreventionThe manure collection tanks, breeding areas, and solid manure treatment areas of the breeding farms are all constructed usinga combination of compacted soil + geomembrane + geogrids (made of materials such as polypropylene) + concrete impermeablelayers. This prevents livestock manure from polluting groundwater and soil, and the impermeability meets the relevantrequirements of the Discharge Standard of Pollutants for Livestock and Poultry Breeding(HJ/T81-2001).Reduce Water Use RiskIn terms of water source security, the breeding farms select areas with abundant water resources, good water quality, andconvenient access to water. They obtain water abstraction permits as required, assess groundwater reserves, and identifygroundwater restricted extraction areas. In some water-de?cient areas, they install water level monitoring devices to monitorchanges in groundwater levels and mitigate the risks associated with groundwater level decline.The Company has established the Muyuan Pig Farming Water Quality Standard and conducts regular water quality testing andanalysis. For six key indicators, testing is conducted every two weeks, while for 29 key indicators, testing is conducted annually.Based on the Common Water Quality Anomalies and Judgment Methods, any water quality that does not meet the standard isanalyzed, and corrective measures are taken accordingly.
Biogas Utilization and Explosion Prevention
To prevent biogas fires and explosion risks, flammable gas alarms, video surveillance devices, flame arresters, fire-fightingequipment, and other explosion-proof measures are installed around the black membrane biogas digester and biogas transferpipelines. Regular safety inspections are also conducted. As of 2023, the Company has installed 2,044 alarm devices and 1,533video surveillance devices.
Reduce Risks Associated with Manure ApplicationTo ensure the safe application of manure to ?elds, the Company adheres to the Technical Speci?cation for Sanitation Treatmentof Livestock and Poultry Manure (GB/T36195) , Technology Code for Land Application Rates of Livestock and Poultry Manure(GB/T25246) , Technical Guidelines for Calculating the Carrying Capacity of Land for Livestock and Poultry Manure, Standardfor Irrigation Water Quality (GB5084), as well as relevant local standards.To prevent secondary pollution to soil and groundwaterfrom manure application, the Company establishes a plan for manure application and utilization, and implements a system forrecording manure treatment and utilization. They determine the timing and quantity of manure application based on the scaleof livestock farming, the area of farmland, the type of farmland, and the growth of crops, using soil testing and formulation todetermine the appropriate application. Additionally, soil monitoring is strengthened, and resource utilization plans are adjustedbased on changes in indicators.The Company employs agronomists to provide guidance to farmers on scienti?c planting and management practices to enhancethe value of biogas slurry. During the harvest season, the farm organizes a "Celebrating Harvest Competition" to evaluate theperformance of farmers in planting. Rewards are provided to farmers who demonstrate outstanding performance, motivatingthem to strengthen ?eld management, improve soil environment, and reduce the use of chemical fertilizers.
Every year, regular environmental monitoring is conducted on soil, groundwater, and surface water in and around each farm.This includes analyzing the current status and trends of environmental indicators and conducting risk warnings. In the event ofabnormal indicators, prompt investigation of the source of the risk is conducted, and measures are taken to address it. This mayinvolve upgrading sewage treatment processes, inspecting the e?ectiveness of sewage treatment facilities in preventing seepage,and implementing ecological restoration measures, etc. Continuous monitoring of changes in environmental quality is carriedout to promote the healthy development of the ecosystem.
To standardize the disposal of diseased and dead pigs and prevent the spread of diseases, the Company adopts centralizedharmless disposal methods such as high-temperature sterilization treatment, with one facility corresponding to each site orfarm, and entrusts external harmless disposal plants for processing. An oversight information system for harmless disposal isestablished, equipped with vehicle-mounted monitoring during transportation, and video surveillance of processing facilities.Collection of diseased and dead pigs is strengthened, along with data statistics and information cross checking, ensuring that theentire process of collection, transportation, and disposal of diseased and dead pigs is controllable and traceable. By-products suchas oil and fat are sold with directed sales, with supervision over the destination and use of each shipment.Organize Environmental Protection Emergency Drills
The Company attaches great importance to emergency management for sudden environmental incidents and has formulatedsite-specific emergency plans for sudden environmental incidents. These plans have been filed with the local ecological andenvironmental department. A reporting mechanism and process for environmental incidents have been established, and trainingand drills for the plans are conducted quarterly. This effectively enhances the Company's emergency response and disposalcapabilities for sudden environmental pollution incidents.
Environmental Monitoring and Remediation
Harmless Disposal of Diseased & Dead Pigs
061062
Muyuan is dedicated to exploring sustainable development models in the pig farming industry. The core concept of ecologicalcycling continuously improves resource utilization e?ciency through technological innovation, improves resource utilizatione?ciency through technological innovation, promotes crop-livestock cycle, and utilizes manure resources, creating an ecologicalcircular economy that features mutual bene?ts between pig farming and crop planting. This approach reduces the environmentalimpact of pig farming while achieving synchronous improvements in economic, ecological, and social bene?ts.
Sustainable Agriculture
Land, air, and grain are essential resources for the development of the pig farming industry. Muyuan actively explores moree?cient production methods to reduce resource consumption in pig production, achieve coordinated development between theeconomy and the resource environment, and enhance development resilience.Resource Conservation
Muyuan has innovated the production mode of the meat industry complex, utilizing multi-story farming buildings. This approachhas increased land utilization e?ciency by 4.3 times compared to traditional ?at pig pens, resulting in signi?cant land resourcesavings.
Land Conservation
We apply new air ?ltration in pig houses, promote the application of equipment of intelligent environment control and explorethe application of minimal ventilation technology for pig herds, reducing air consumption per pig by two-thirds.Reduce Air Consumption
Promote low-soybean meal diets to reduce soybean consumption: In 2023, the Company's soybean meal usage decreased from 7.3%to 5.7%, and the livestock industry reduced from 14.5% to 13%. Promoting the industrialization of synthetic biology technologycan further reduce soybean usage in pig farming by 20 million tons.Intelligent feeding management to reduce feed waste: Developed an intelligent feeding system that implements daily formulationadjustments, providing precise and dynamic nutrition supply, thereby reducing feed wastage.Improve pig farming e?ciency and e?cient grain conversion: Implementing a Sky Net project to advance disease elimination,enhance overall survival rates throughout the farming process, enabling more pigs to be raised with less feed; Implementingsmart pig farming to achieve re?ned management, improving feed conversion rates, and producing higher quality pork withfewer grain resources.
Save Grain
Fully utilize the roofs of pig pens to construct distributed photovoltaic power generation systems and replace fossil fuels withclean energy such as biogas power generation and biogas puri?cation.Energy Saving
In addition, the Company has established comprehensive information systems in all farms to store environmental data at alltimes. It monitors environmental parameters in pig pens in real time, tracks trends in pollutant emissions through early warningsystems, analyzes and summarizes environmental risk information, and ensures compliance with environmental regulations.This supports scienti?c environmental decision-making and helps reduce environmental risks.
A livestock farm is essentially a circular economy. Muyuan integrates e?cient farming with agricultural development, promotinga circular economy model that combines "livestock-biogas slurry-green agriculture". By utilizing resources such as liquid fertilizer,and manure fertilizer in an appropriate manner and promoting ecological cycling that features mutual benefits between pigfarming and crop planting, Muyuan achieves zero emissions from pig farming. Simultaneously, this approach promotes thereduction of chemical fertilizer usage, improves soil structure, enhances soil fertility, and increases soil carbon sequestrationcapacity, thereby facilitating increased productivity and income for farmers.
Crop-Livestock Cycle
Yongji Muyuan Second Sub-farmEstablishing a specialized team of agronomists, we tailor research and development of crop resource utilization techniques tolocal conditions. Following the guidelines of Technical Guidelines for Calculating the Carrying Capacity of Livestock and PoultryManure Land, and considering di?erent soil fertility conditions, crop varieties, and yield goals, we apply scienti?cally determinedamounts of treated manure to fertilize designated plots. As of now, we have developed resource utilization pathways for 39crops,including sweet potatoes, Valencia oranges, lotus roots, water bamboo, and pineapples.
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Around the farm, we have installed a support irrigation network spanning 26.8929 million meters, free of charge for farmers, topromote the substitution of biogas slurry for chemical fertilizers. Agronomists provide timely agricultural technology services andplanting management training based on crop growth cycles. They conduct fertilizer surveys and monitor e?ectiveness, ensuringprecise pest control and fertilization. This approach guarantees crop nutrient requirements are met while reducing chemicalfertilizer usage, increasing crop yields, and boosting farmers' income. Additionally, on farmland where manure is applied,there's a noticeable increase in the populations of insects, frogs, waterfowl, and other organisms, contributing to biodiversityconservation.
Index2023 PerformanceCumulative pipeline network laid to support agriculture (10,000 meters)2,689.29
Farmland served (10,000 mu)452.07Manure fertilizer production (10,000 tons)51.90Chemical fertilizer substitution (10,000 tons)14.68Chemical fertilizer reduction in wheat season (kg/mu)27.8
Increased wheat yield (kg/mu)35.89Reduced investment and increased income for wheat (yuan/mu)181.73
Fertilizer reduction during corn season (kg/mu)26.84
Corn yield increase (kg/mu)31.83Reduced investment and increased income for corn (yuan/mu)170.54
Organic matter increase (%)6.76Reduced investment and increased income per mu (yuan)352.27Total investment reduction and income increase (100 million yuan)14.82
2023 Annual Resource Utilization Performance is as follows:
Muyuan actively engages in biodiversity management to protect the ecological environment and biodiversity in the areas where itoperates.
Ecological Restoration andBiodiversity Conservation
Nanyang Black Pig is one of the high-quality livestock breeds nationwide, and livestock breed resources are essential strategicresources for the sustainable development of animal husbandry in Henan Province. To protect local excellent pig breeds, theCompany fully leverages its expertise in piglet breeding. It provides technical support to Neixiang Shunfa Nanyang Black PigProtection Technology Co., Ltd. Through the Chenggang Nanyang Black Pig Breeding Protection Farm, it conducts hybridbreeding experiments, thereby increasing support for the preservation, technology, and research efforts related to Black Pigpreservation.As of the end of 2023, there were 3,146 heads in stock, contributing to the protection of local excellent germplasmresources of Nanyang Black Pigs and the expansion of the Nanyang Black Pig population.In March 2009, Nanyang Black Pig was listed in the Henan Province Livestock and Poultry Resources Protection Directory. In 2015,it was selected as a Chinese Geographic Indication, and in June 2020, it was included in the National Livestock and Poultry GeneticResources Directory.
Protection of Germplasm Resources
We recognize that the pollution and changes in water quality and soil at the farms not only pose risks to our own operationsbut may also lead to a decline in biodiversity. The Company adheres to relevant laws and regulations, strictly conductingenvironmental assessments before project construction. We conduct comprehensive ecological impact assessments, includinglocal vegetation, wildlife, and soil erosion, to avoid environmentally sensitive areas. After the completion of project constructionand operation, we regularly conduct assessments and monitoring of groundwater, soil pollution, and agricultural product qualityto ensure that our operations do not have a negative impact on the local ecology. We are committed to managing the entirelife cycle of the project to minimize or eliminate the impact of production on the ecological environment. In 2023, we did notexperience any events that harmed biodiversity.The Company pledges not to carry out production and business activities within World Heritage Sites and any ecological redlineprohibited development areas. We respect all internationally recognized protected areas, including those designated by theInternational Union for Conservation of Nature (IUCN) as Ia, Ib, II, III, IV, V, and VI protected areas.Speci?c monitoring items, monitoring frequency, etc., are shown in the table below:
Ecological Environment Monitoring
MonitoringObjectives
Monitoring Items
MonitoringFrequency
MonitoringCoverage Areasoil
pH, conductivity, organic matter, total nitrogen,alkaline nitrogen, available potassium, availablephosphorus, mercury, arsenic, copper, zinc, lead,
chromium, nickel, cadmium
2 times/year, everyJune, September
100% coverage of farms
groundwater
pH, ammonia nitrogen, permanganate index, totalhardness, nitrate nitrogen, nitrite nitrogen, copper,
zinc, total detection amount
2 times/year, everyJune, September
100% coverage of farmsSurface water
pH, conductivity, chemical oxygen demand (COD),permanganate index, ammonia nitrogen (NH3-N),
total nitrogen (TN), total phosphorus (TP)
1-4 times per year
Sampling is conducted
based on the distributionof surface riversNote: 1 mu≈0.067hm
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After the scienti?c treatment of livestock waste, it can provide su?cient organic matter and nutrients to the soil. The Companycontinuously explores soil improvement and governance models and technological paths, adapting them to local conditionsto promote the transformation of saline-alkali land and desertification control. Through measures such as organic fertilizerapplication, the organic matter content of saline-alkali soil is increased, pH value is regulated, and the reproduction and activityof microorganisms in the soil are promoted. In 2023, the Company improved 229,500 mu(15,300hm?) of saline-alkali land andtreated 88,200 mu (5,880 hm?) of deserti?cation through biogas slurry application.
Soil Improvement
The western region of Jilin Province is one of the world's three largest concentrated areas of soda saline-alkali land, wherevegetation is sparse, the ecosystem is fragile, and productivity is low. Da'an Muyuan enters the ?elds, conducts soil testing, andutilizes liquid fertilizer and manure fertilizer application techniques. For four consecutive years, they have developed a circulareconomy that features mutual bene?ts between pig farming and crop planting to improve saline-alkali land. In collaborationwith the Jilin Academy of Agricultural Sciences, the Company has researched the technology for improving saline-alkali landin western Jilin. They have selected salt-tolerant rice as the main crop for improvement and established the Da'an Saline-AlkaliLand Improvement Demonstration Park, employing a model of improvement involving "liquid fertilizer + organic fertilizer + riceplanting."As of the end of 2023, a total of 1,240 mu(82.67 hm?) of saline-alkali land has been improved, transforming wasteland into arable?elds. The yield per mu has increased from 200 kg to 425 kg, a reduction of 52.38% in soil salinity, and an increase of 66.67% inorganic matter. At the same time, the Company has provided technical training for crop planting and production management tofarmers, leading to the improvement of over 4,000 mu(266.67hm
) of saline-alkali land by surrounding farmers. This serves as ademonstration for the reclamation and improvement of saline-alkali land in western Jilin Province, achieving the goal of storinggrain in the land and utilizing advanced agricultural techniques.
1,240Improvement of saline-alkaliland of
mu
229,500Improved area of saline-alkali land by biogasslurry application
mu
52.38%
A reduction in soil salinity of
88,200
Area of desertifcation control
4,000Improved area of saline-alkaliland nearby
mu+
Muyuan Expands the Demonstration Park for the Improvement of Saline-Alkali Land in Da'an, JilinPracticeAchievements
Comparison before and after the Demonstration Park for the Improvement of Saline-Alkali Land in Da'an, Jilin
MonitoringObjectives
Monitoring Items
MonitoringFrequency
MonitoringCoverage Area
Agricultural
products
Ash content, nitrogen, phosphorus, potassium,
copper, zinc, sodium, bulk density
1-2 times per yearRandom sampling
66.67%
An increase in organic matter of
mu
Comparison before and after Naiman Muyuan's Desertifcation Control
Heading stageFilling stage
Naiman Banner, Tongliao City, Inner Mongolia is one of the counties with severe desertification in the Horqin Sandy Land,with sand covering 62% of the total area of the banner. Naiman Muyuan has leveraged the advantage of organic waste resourceutilization and explored deep land improvement to control deserti?cation. Converting livestock and poultry manure into organicfertilizers and planting drought-resistant plants such as sea buckthorn and poplar trees, it has effectively restored the localecological environment. By the end of 2023, a total of 14,000 mu(933.3 hm?) of deserti?cation in Naiman Banner, Tongliao City, hasbeen controlled.
JUNE,2016JUNE,2023
Naiman Muyuan carries out deserti?cation controlPracticeAchievements
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Pragmatic and Impactful Responsibility
Pragmatic
Responsibility
Assumption
Product QualityHappy EmployeesSustainable Supply ChainCommunity DevelopmentIndustry Sharing
SDGs referred to in this chapter
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Pragmatic and Impactful Responsibility
Muyuan adheres to the concept of high-quality development and the principle of "produce healthy foods for society to improvethe life quality of the public,helping people enjoy an abundant life", ?rmly believing that "high-quality pork comes from pigsliving a high-quality life", does a good job in safety and quality management from the source, laying a solid foundation for productquality and building a food safety ecosystem.Muyuan has established a fully traceable system from the source to the end through intelligent and digitalized means. Thisensures comprehensive quality and safety management and supervision across the entire industry chain, ensuring that every biteof pork we eat is safe. At Muyuan, pigs are fed with precisely formulated nutrition and are provided with ultra?ltered water. Theybreathe clean air ?ltered through four layers and reside in pigsties with regulated temperature and humidity throughout the year.Smart devices continuously monitor the health status of the pigs, promptly capturing and transmitting abnormal information tosafeguard the well-being of the herd.
Food Safety and Quality
Muyuan strictly adheres to relevant laws and regulations, including Food Safety Law of the PRC,Agricultural Product Quality andSafety Law of the PRC,Law of the People's Republic of China on Animal Disease Control,the Regulations on Swine ProductionPlaces Quarantine,the Regulations on Swine Production Places Quarantine,National Food Safety Standard-Maximum ResidueLimits for Veterinary Drugs in Foods, andNational Food Safety Standard-Maximum Residue Limits for Pesticides in Food. Muyuanhas formulated a series of regulations and requirements covering the entire process of food safety and quality management,such asthe Regulations on Food Safety and Quality Management,the All-Sta? Supervision System for Food Safety and Quality,and the Food Safety Supervision and Management System. It adheres to the principles of "put the precautions ?rst, assess therisks comprehensively, transparent and traceable throughout the process," continuously improves the food safety and qualitymanagement system, and enhances the level of food safety and quality management.
Product Quality
Muyuan has established a Sustainable Development Committee to decide and advance the management of food safety andquality. The committee organizes Quality Management Conferences monthly to analyze and evaluate the current status of qualityand safety, so as to further formulate improvement plans. Three major divisions cover the entire business chain of food safety andquality management, requiring solid e?orts from each department and promoting orderly progress. Regions, areas, farms andfarm lines are the business entities who are responsible for implementing speci?c management work of food safety and quality .
Management Structure
Supply ChainFeed DivisionBreeding PigsVeterinary DepartmentNutrition DepartmentProduction Department
Sales Department
Intelligentization
Quality Control
Slaughtering Division
Nanyang RegionWan Dong Region
Inner Mongolia Region
Board of Supervisors
Strategy Committee
Audit CommitteeNomination CommitteeRemuneration andSustainable Development
Committee
Board of Directors
CharirmanOperation Level
Audit department
Management System
Appraisal Committee
Management Department
DepartmentDepartmentDepartment
We established "711" whole industry chain food safety and quality management system to oversee and manage the entire chainand life-cycle of our products.
The Company has established a multi-party control system involving quality control,veterinary, nutrition, and procurement, mainly focusing on the supplier management,pretesting, and daily sampling of veterinary drugs and vaccines, to strictly control qualityand safety.Input materials
The Company comprehensively ensures feed quality by monitoring and managingraw material suppliers, as well as carrying out on-site, processing and ?nished productinspections.
Feed guarantee
The Company rigorously controls and manages drug residue, broken needle, disease,and good operational practices, etc.; upgrades the biosecurity prevention and controlsystem; and establishes a standardized internal audit system for farming so as toimprove the quality and safety levels.Pig Production
"711" Whole Industry Chain Management System
The Company has a series of advantageous testing projects centered around food andagricultural product testing. It has obtained laboratory CMA qualification and CNASaccreditation, and is able to provide testing technology services in ?elds such as livestockand poultry products, animal feed, veterinary drugs, disinfectants, fruits, vegetables,beverages, etc. It also possesses comprehensive food safety testing veri?cation from rawmaterials to ?nished products.
Inspection and testing
Muyuan has established a comprehensive food safety assurance system covering the entire process from input materials, feed, pigproduction, inspection and testing, pig sales, slaughter and meat to market circulation.
"7" whole industry chain food safety guarantee systems
guarantee
guarantee
guarantee
Muyuan food safety and quality system
"711" Management System:
"7" whole industry chain
food safety guaranteesystems
"1" whole industry chainfood safety informationtracing system
"1" food safety culturesystem
Standardized procedures Product sales standards and customer service system
Comprehensive industry chain food safety information tracing system
Muyuan food safety culture system
Input materialsguarantee
Feed guaranteePig productionguarantee
Inspection andtesting guarantee
Pig salesguarantee
Slaughter and meatsafety guarantee
Market circulationguarantee
General Meeting of
Shareholders
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Pragmatic and Impactful Responsibility
The Company mainly conducts quality management for delivery, market surveys,customer service, etc. It creates healthy products by strictly examining before salesaccording to Muyuan Commercial Pig Sales Standards, implementing a quality auditresponsibility system, and improving Product Recall Control Procedures and SimulatedRecall Exercise Plan for Non-Conforming Products.Pig sales guarantee
The Company conducts strict inspection and quarantine, hygiene management, productstandard acceptance, and compliance management throughout the pre-slaughtering,slaughtering, post-slaughtering and processing stages to ensure food safety.Slaughter and meat
The Company conducts quality and safety management from market surveys, marketsampling, pre-sales testing, terminal customer service, logistics transportation,complaint recalls, etc., comprehensively ensuring food safety in market circulation andproviding customers with high-quality products.
Market circulation
The Company has established a comprehensive food safety and quality big data tracing system for the entire industry chain.Through intelligent procurement systems, feed management systems, production management platforms, Hongxin detectionsystems, slaughter management systems, sales management systems, etc., it achieves precise data collection from the source tothe end and intelligent platform management from the farm to the table, truly realizing the visibility, controllability, traceabilityof the whole industry chain, ensuring food safety and quality.
"1" whole industry chain food safety information tracing system
Cognition
Through activities such as food safety supervisor training classes, food safety and quality certi?cation,posting food safety articles every day, holding daily morning meetings in the pig farms, and sharing foodsafety cases, employees are made aware of what food safety is and how to ensure it.
Practice
Through monthly quality conferences, overall awareness of food safety and quality management isstrengthened among all employees.
Adherence
Supervise and inspect the implementation of food safety and quality management systems andrequirements, promptly disclose rewards and punishments, and provide training and empowerment fornon-compliant behaviors.
Perception
Based on daily food safety business operations, seminars on food safety culture and technologicalinnovation, and reward-based reporting for food safety, relevant supervision and management systemsare formulated to institutionalize food safety management.
The Company practices the commitment of "guarding quality with life" and conducts food safety culture construction from fourdimensions: cognition, perception, practice, and adherence, to enhance the food safety awareness of all employees."1" food safety culture system
guarantee
guarantee
Muyuan promotes food safety and quality culture throughactivities such as training sessions, Food Safety Week, andFood Safety Activities Month. In 2023, a total of over 1,450 foodsafety and quality training sessions were conducted, mainlytargeting frontline management cadres, frontline sta?, as wellas production and operation core teams in regions of varyingsizes. Additionally, the Company organized food safety pledgesfor employees at the site level and required them to signFoodSafety Commitmentbefore receiving fattening pig batches,achieving 100% coverage.
ActivitiesNumber of Participants
3.15 Food Safety Week75,000Food Safety Certi?cation108,000Food Safety and Quality Morning Meetings in Pig Farms39,000
Food Safety Training in Pig Farms63,000
Quality is one of the core elements for the high-quality development of the pork industry. Muyuan adheres to the qualityleadership strategy and actively establishes quality culture and quality pride. The Quality Control Department takes the leadin holding monthly quality management meetings. They organize core teams related to breeding, feed, nutrition, health,informatization, intelligentization, and pork slaughtering, engaging in extensive discussions and reviews regarding customerculture, customer demands, and quality improvement progress. They replicate and promote excellent practices, clarify workobjectives, plans, and priorities, and propagate and implement various systems and standards from top to bottom. This enhancesthe Company's food safety management capabilities, ensuring the production and supply of safe and reliable pork products.
Muyuan strictly adheres to the Company's Food Safety Incident Response and Handling System, standardizing the processingprocedures for food safety risk events. Muyuan is able to respond promptly to risk events, primarily including responseprocedures for pre-slaughter urine sample testing non-compliance and post-slaughter organ testing non-compliance, etc.Additionally, it clari?es the responsibilities and assessment measures for sales and quality control positions at the breeding andslaughtering ends, enhancing awareness of food safety risks and capabilities to handle food safety incidents.
Food Safety Emergency Response Mechanism
Muyuan strictly follows the management requirements for product recalls in accordance with theQuality managementsystems Requirements(GB/T19001-2016), Hazard Analysis and Critical Control Point (HACCP) Additional RequirementsV1.0,andNational Food Safety Standard Hygienic Speci?cations of Meat Packing Plant(GB12694-2016). It has established
Product Recall Control Procedures, specifying ?rst-level, second-level, and third-level recall management. The recall isinitiated within 24, 48, or 72 hours after the Company becomes aware of food safety risks, and the recall plan is reported tolocal food and drug supervision and management departments at or above the county level. For example, in case of issueslike product labeling or customers and consumers misleading, recalls are initiated after approval by the general manager,
Product Recall
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Pragmatic and Impactful Responsibility
Muyuan commissions third parties to conduct customer satisfaction surveys, paying monthly field visits to distributors andslaughterhouse clients. Focusing on product quality and delivery services, the Company forms dedicated project teams to collectand analyze feedback data from upstream and downstream customers, providing more satisfactory products and services. In2023, the overall customer satisfaction rate was close to 100%.
Customer Satisfaction
Muyuan strictly implements market prohibition management based onNational Food Safety standard Fresh (Frozen)LivestockandPoultry Products（GB2707-2016）andSampling Criterion for the Monitoring of Veterinary Drug Residuesin Animals and Animal Products（NY/T 1897–2010 ）. It has also established the Muyuan Management Standards for Ex-factory Meat Products, de?ning ten red lines for food safety. All products must pass batch sampling inspections conductedby the food safety testing laboratory before leaving the factory. Therefore, all outgoing products must obtain the testingreports for quali?ed products (including product factory inspection quali?cation form, African swine fever testing report,meat quality inspection certi?cate, delivery note, and quarantine quali?cation certi?cate). Non-compliant products arestrictly prohibited from leaving the factory.Muyuan has formulated and issueda Notice on Stopping the Supply to Water-Injected and Glued Pork Merchants, puttingan end to cooperation with customers engaged in the sales of water-injected and glued pork. It strictly requires customersto prevent cross-contamination of products and promptly share information after market sampling inspections, jointlyensuring food safety in the circulation process.As a leader in industry upgrading, Muyuan not only supplies high-quality pork to the public but also shoulders theindustry's responsibility by ?rmly combating behaviors detrimental to food safety within the industry.
Market Management
and recall information is disseminated through e?ective news media and o?cial channels. The Company organizes atleast one simulated recall exercise annually to ensure e?cient execution of product recalls in such scenarios.In 2023, the Company improves the Product Recall Control Procedures and polishes some speci?c recalling solutions. Forexample, it included additional key personnel information to increase the e?ciency of product recalls, enabling the recallprocess to be initiated within 2 hours. During the year, the Company conducted one simulated recall drill, and no actualproduct recall events occurred.
Muyuan always adheres to customer needs orientation with the tenet of "creating value for customers". We strive to establish afair and just cooperative environment while continuously improving service standards.The Company continually optimizes the methods it cooperates with pig producers, pioneering in the industry customer-drivenpricing model, which involves zero intervention, zero bargains, and zero privileges, ensuring high quality and fair pricing.Through the Smart Sales APP, customers can open accounts, sign contracts, declare product requirements, view logistics orders,consult and provide feedback online. Muyuan promptly responds to inquiries and solve problems, creating a fair, transparent,and e?cient trading environment to enhance transaction e?ciency together with customers.
Customer Service
Muyuan places high importance on customer information security and privacy protection, strictly adhering toMuyuanInformation Confidentiality System. All the data of the company is classified into five levels of confidentiality—top secret,con?dential, secret, internally public, and completely public. Information leakage incidents are classi?ed as major, severe, orgeneral, with emergency response teams implementing corresponding emergency responses. The Company employs variousinformation security protection measures such as Web Application Firewall(WAF), Situational Awareness（SA）, antivirussoftware, strict access control policies, and encryption for sensitive data storage and transmission to strengthen customerinformation security and protection management. Additionally, regular information security training and emergency drills areconducted to enhance the information security awareness of all employees, ensuring the continuous development of companyoperations in a trustworthy and reliable environment.In 2023, Muyuan did not experience any signi?cant data breaches, major information security incidents, or customer privacy anddata security-related complaints.
Customer Information Security and Privacy Protection
Muyuan establishes a complete complaint channel and strictly followsCustomer Complaint Management Systemto handlecustomer complaints in accordance with regulations. Various communication channels, such as Smart Muyuan APP, theDirector's mailbox, 400 customer complaint hotline, regional complaint hotlines, and dedicated business managers, ensure timelyfeedback and follow-up on complaints, continuously improving product and service levels. In 2023, Muyuan achieved a 100%response rate and timely resolving rate for customer complaints.
Muyuan adheres to various domestic and international standards accredited by the Global Food Safety Initiative (GFSI) in feed,breeding, and slaughter. We actively participate in the revision or formulation of laws, regulations, and local standards such as2024 Food Safety Sampling Plan of the State Administrationfor Market Regulation, Speci?cations of Feeding Management forGrowing and Fattening Pigs in Intensive Pig Farms andRegulations on Disease Prevention and Control in Intensive Pig Farms.This is aimed at establishing a modern company complying with good agricultural practices, strengthening food safety andquality management certi?cation for suppliers, and ensuring the safety of pork supply from the source.As of the end of 2023, the certi?cation status of Muyuan and its suppliers in terms of food safety and management is as follows：
Management Certi?cations and Standards
Certi?cationObject
Sector
Certi?cationLevel
Certi?cation Content
Muyuan
Feed International 14 feed mills certi?ed under FSSC22000 Food Safety Management System
Breeding
National
The First domestic full-chain digital certi?cation of high-quality livestockand poultry productsInternational5 breeding farms certi?ed under GLOBAL G.A.P
National
6 breeding farms obtained the quali?cation to supply live pigs from themainland China to Hong Kong and MacaoNational
Neixiang Muyuan Modern Agricultural Complex Co., Ltd obtained ChinaG.A.P. certi?cation
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Pragmatic and Impactful Responsibility
Food Safety Review
In 2023, Muyuan's breeding and slaughter segments underwent a total of 305 government and customer reviews with a passingrate of 100%, including 38 external customer reviews, like Hormel, Metro, McDonald's, Yum and IKEA, etc. The pass rate for thesereviews was 100%.
Certi?cationObject
Sector
Certi?cationLevel
Certi?cation Content
MuyuanSlaughter
International 10 slaughterhouses certi?ed under ISO9001 Quality Management SystemInternational
2 slaughterhouses certi?ed under ISO45001 Occupational Health and SafetyManagement SystemInternational 1 slaughterhouse certi?ed under ISO50001 Energy Management SystemNational
4 slaughterhouses certi?ed under national standards for slaughterhouseconstruction
MuyuanSuppliers
Veterinary
DrugSuppliers
International GMP Certi?cation
Feed Additive
Suppliers
International 1 supplier certi?ed under BRCInternational 13 suppliers certi?ed under FSSC22000National3 suppliers certi?ed under ChinaHACCPInternational1 supplier certi?ed under GAA
External Reviews
At the breeding segment, Muyuan conducts inspections of all breeding farms by farm and line quality control o?cers every othermonth, totaling 107,000 inspection items. After collation and analysis, the results are publicly disclosed in the form of monthlyfood safety self-inspection and self-correction reports, through which, continuous improvement is achieved.
Internal Reviews
At the slaughter segment, food safety o?cers at each subsidiary of Muyuan Meat bi-monthly inspect its workshops based on the
Process Control Assessment System. In 2023, a total of 240 on-site inspections were conducted at 10 slaughterhouses, covering44,200 inspection items. After summarizing the inspection ?ndings, semi-monthly process control inspection reports are publiclydisclosed. Through self-inspection and self-correction, continuous improvement is achieved.
Muyuan advocates scientific pig farming, continuously improving both the concept and practice of animal welfare, andcomprehensively enhancing the welfare level of pigs.Animal Welfare
Animal Welfare PrinciplesMuyuan has establishedAnimal Welfare Policy and Guidelines, Muyuan Animal Welfare System,andMuyuan Animal WelfareManualto standardize animal welfare practices, clarify responsibilities and incentive mechanisms, e?ectively manage all aspectsof the Company's animal welfare activities, and ensure the realization of animal welfare principles.Muyuan regards Freedom from hunger and thirst, Freedom from discomfort, Freedom from pain, injury and disease, Freedomfrom fear and distress, and Freedom to express normal behavior as the core standards of animal welfare. It provides animalwelfare commitments, focuses on the needs of pigs, and offers healthy diets, comfortable living environments, diseaseprevention, and meticulous care. The Quality Control Department supervises implementation, conducts regular reviews, andprovides training to comprehensively safeguard and improve the welfare level of pigs.
Committed to designing, maintaining, and using facilities that meet the comfort needs of pigs.Ensuring adequate access to drinking water and high quality feed for pigs, meeting theirnutritional needsComplying with all applicable laws and regulations, treating pigs humanely, and promotingtheir well-being.Providing timely treatment and care to sick or injured pigs.Humanely euthanizing sick pigs that cannot be e?ectively cured.Actively responding to internal, external, and third-party welfare concerns, verifying andimproving the Company's animal welfare practices.
Muyuan guarantees the healthy growth of pig populations by conducting animal welfare practices according to relevant systemsand principles. There are eight key practices, namely more comfortable environment, much safer and more nutritious feed,more comprehensive health management, more pleasant living conditions, antibiotic reduction and antibiotic-free pig farming(asdetailed in P81-82), behavioral enrichment, more friendly transportation and slaughter, along with more empowerments andcerti?cations.
Animal Welfare Practices
Muyuan regards the design of pig farms as a key aspect of ensuring animal welfare. It thoroughly considers factors such asscienti?c site selection and biosecurity. By utilizing heat-insulating materials, the pig pens are kept warm in winter and cool insummer, laying a solid foundation for the health of the pig population. To meet the pigs' need for fresh air, Muyuan innovates
More Comfortable Environment
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Pragmatic and Impactful Responsibilitytraditional pig pens by adopting fully enclosed structures that integrate new air filtration, independent ventilation, anddeodorization and sterilization systems. At the inlet, a four-layer ?ltration system is installed: the ?rst layer consists of stainlesssteel protective mesh, primarily filtering disease-carrying organisms such as mosquitoes, flies, and rodents; the second layercomprises G2 ?lter cotton, e?ectively ?ltering visible dust, sand, and aerosol particles; the third layer is a pre-?lter that blocksparticles larger than 0.3 microns in the air; the fourth layer is a high-e?ciency precision ?lter that e?ectively intercepts relativelysmall aerosol particles that are not easily captured. By employing this four-layer precision filtration system, the interceptionrate of viruses and bacteria such as African swine fever and novel coronavirus reaches 99.3%, ensuring that the air enteringthe pig pens reaches Grade M16, close to ICU air standards, thus safeguarding the health of the pig population. At the outlet,the odor emitted from the pig pens is intensively treated, achieving odorless emissions without causing disturbance to nearbycommunities.Temperature Control：Muyuan develops and constantly optimizes temperature standards for pig pens to provide pigs
with a better temperature experience. The standards are set and adjusted based on the temperature requirements ofdi?erent stages of pig populations, while referring to those of China Association for Standardization(CAS) and GLOBALG.A.P..Humidity Control：Changes in humidity can cause symptoms such as coughing and poor appetite in pig populations.Muyuan uses spraying devices and monitors humidity in real-time with detectors to ensure that the pigs have acomfortable humidity environment at all times.Ammonia Concentration：Ammonia concentration greatly affects the sensory experience of pigs. Based on thecorrection of sensory ammonia concentration, Muyuan refers to both farm animal welfare standards and GLOBALG.A.P.standards for ammonia concentration and has established stricter ammonia control standards.
Four-layer ?ltration system
Muyuan develops multi-stage feed formulations to provide pigs with high-quality sterile feed, implements intelligent feeding,ensures a good feeding environment, and puri?es water sources through ultra?ltration to provide clean drinking water.Much Safer and More Nutritious Feed
Dynamic nutritional models are established based on breed, growth stage, season, etc., to ensure optimal nutrition for thepigs.Feed production adopts high-temperature sterilization technology, with real-time online monitoring and intelligentcontrol of sterilization temperature to ensure sterilization e?ectiveness. Feed transportation is fully enclosed to mitigatebiosecurity risks and ensure feed safety.Ultra?ltration equipment for water sources is installed in pig farms, with a pathogen removal rate of 99.99%, providingpigs with abundant, clean, and fresh drinking water, and blocking the transmission pathways of waterborne pathogens.
Water samples are regularly collected and tested by third-party organizations according to the GB5749-2006 standard toensure water quality for the pigs.The intelligent feeding system automatically collects information such as feed intake and water consumption, analyzesthe health status of the pig population based on growth curves, and adjusts nutritional formulations accordingly. Theautomatic feeding system provides precise feeding, and the feed troughs are designed to allow multiple pigs to eatsimultaneously, preventing injuries due to food competition and ensuring every pig is well-fed.Sow feed is formulated according to colostrum intake, immune stimulation, healthy gut microbiota, as well as weightand vitality targets, to improve the quality of piglets and establish a foundation for health. Feed for weaning piglets isformulated with progression: from porridge-type feed to wet mash feed, to dry feed, to palatable feed, and ?nally to easilydigestible feed, ?nally helping piglets have solid feed.
Ultra?ltration Equipment for Water SourcesIntelligent Feeders
Muyuan implements disease puri?cation to by purifying infection sources, cutting o? transmission pathways, and protectingsusceptible pig populations, so as to ensure the health of the pig herds. The Company establishes a three-level health warningmechanism through intelligence and information-based approaches, equipping units with inspection robots with smartsensors such as cameras, microphones, thermal imagers, temperature and humidity sensors, etc., to collect data on pig images,videos, sounds, body surface temperatures, environmental temperatures, NH
, CO2,dust, etc., for timely monitoring of the pigpopulation's status. Intelligent inspection equipment captures information about abnormal pigs on-site and sends it to skilledbreeders and management cadres through the information system, facilitating timely care or treatment for abnormal pigs. Thedevelopment of intelligent needle-free injectors not only ensures precise control of injection dosage to make good use of drugsand avoid the risk of cross-infection from traditional needles but also reduces the pain and stress response of pigs, thus improvingtheir welfare.
More Comprehensive Health Management
Transmission sources：biosecurity (air ?ltration, end-washing rooms); inspection and testing; reducing or suppressingthe types and quantities of pathogens.
Transmission pathways：environment control management (precise ventilation without cross-contamination),segregation of weak or susceptible pigs, disinfection.Susceptible pig populations：protection of susceptible pigs through drug sensitivity screening and precise medication.
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Pragmatic and Impactful Responsibility
Muyuan considers factors like pig quantity, age, weight, feeding space, and water space to design pens that meet animal welfarestandards and utilizes intelligent environmental control systems to monitor pen conditions in real-time, ensuring a healthy andcomfortable environment for pigs. Muyuan also sets stocking density standards according to farm animal welfare and GLOBALG.A.P. standards, ensuring ample space for each pig to lie down comfortably.
More Pleasant Living Conditions
Electronic feeding stations：pigs can eat here precisely without any disturbance, and the activity space is enough at other
time.Pregnant sows：when the gestation age reaches 30 days and embryo implantation is ensured, free access activities are
allowed.Lactating sows： have access to tailored farrowing pens that allow free movement; equipped with hemp paddingsto meetresiding and comfort needs (Farm No. 27 in Neixiang could meet the requirements, and have been improved after thecooperation with IKEA).
Nursing piglets：with guardian light boxes, warming boxes, warming pads and lights equipped in the nursing pens, pigletsare nursed at optimal temperature; the absence of gestation crates(single sow pens) allows sows to move freely in and outof the pens,for eating and exercising.
Muyuan employs welfare design and regulates human behavior to ful?ll pigs' behavioral habits and treat them humanely.
Behavioral Enrichment
Social needs of pig herds：the Company provides materials or toys that pigs can root, chew, and ?ip, allowing them toexpress their instincts freely. Each pig pen is kept separate to ensure pigs have numerous companions and ful?ll theirsocial needs.Tail docking and castration of piglets：tail docking is performed on piglets older than 7 days, with timely iron
supplementation and medication for any abnormal piglets post-operation, which turns out that infections are rare andpiglets can completely recover after operation; Castration is carried out on piglets aged 3-5 days under the condition ofdisinfection before and after operation, so as to avoid any infection.
Supplemental feeding trays for piglets：additional feeding spaces are provided during the nursery period to prevent that
some pigs are made weak because of crowdedness during feeding.
Muyuan mandates and implements the polishing of contact surfaces such as transport vehicles, loading ramps, and guardrails toprevent injury and reduce pain for pigs.Muyuan adopts more reasonable loading and unloading operations and provides a superior pre-slaughter environment,implementing gas stunning techniques in all slaughterhouses to ensure pigs do not experience pain.
More Friendly Transportation and Slaughter
Unloading platforms：In place of sloped unloading bridges, Muyuan utilizes adjustable unloading platforms to preventexcessive stress on pigs and ensure the safety of unloading personnel.Driving lanes：Designated personnel lanes ensure pigs are moved without injury or stress, maintaining meat quality.
Those who herd pigs undergo animal welfare training and are subject to performance evaluations to ensure non-violenceon the treatment of pigs.Environmental requirements for resting pens： Rooms are fully enclosed and the exhaust air can be 95% ordor-lessthrough deodorization and filtration. Designed to meet farm standards, negative pressure ventilation maintains atemperature of 18°C and CO
concentration below 3,500 ppm, with a noise alarm system in place.CO
stunning：optimal concentrations and stunning durations (CO
pit bottom concentration of 75%-85%, 115s-125s) aredetermined through assessment; 7-8 pigs per pen; the stunning is considered e?ective if pigs do not regain consciousnessand exhibit no observable reactions after stunning and exsanguination, during which restraint, fright, or discomfort areprohibited to avoid stress among pigs.
Muyuan regularly conducts internal and third-party animal welfare empowerments and certi?cations (as detailed in the FoodSafety and Quality Certification Standards, and Food Safety Inspection related content), continually elevating animal welfarepractice standards.Muyuan rigorously oversees the implementation and enforcement of animal welfare policies and standards. Every month,quality control officers conduct process control point inspections according to GLOBALG.A.P. standards. They inspect theimplementation of animal welfare at the farms based on theChecklist for Process Control of Pig Farms, supervising and auditingon-site biosecurity prevention and control, pig feeding, micro-environment control of the units, antibiotic use, and environmentalenrichment material use. They share and commend excellent practice cases and provide explanations and empowerments fornon-compliant situations, working with management personnel to formulate improvement measures.Simultaneously, the Company conducts daily training on epidemic prevention, health management, and micro-environmentcontrol, antibiotic use, and other animal welfare-related requirements to ensure the e?ective implementation of animal welfarestandards.
More Empowerments and Certi?cations
Muyuan collaborates with downstream customer IKEA on BetterPig Welfare Pork Programme, with registered farms makingimprovements according to IKEA's Humane Farm Animal Welfare Standards (HFAC), further enhancing animal welfare practicestandards. Muyuan shared its practices in animal welfare and case studies of BetterPig Welfare Pork Programme with IKEA at theLivestock Industry Sustainable Transformation Seminar held in November 2023. Through measures such as renovating pig pensand implementing more reasonable slaughter practices, this procurement project achieved a phased success, e?ectively elevatinganimal welfare standards. This project marks Muyuan's first endeavor in producing customized welfare pork products frombreeding to slaughter, segmentation, sales, and premium pricing, establishing a dedicated traceability system and facilitating anorder-based production model for welfare products.
Muyuan and IKEA: BetterPig Welfare Pork Programme
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Pragmatic and Impactful Responsibility
In 2023, Muyuan participated in theChallenge Cupanimal health and welfare industry study tour organized by China AnimalHealth and Food Safety Alliance(CAFA), traveling to the UK for collaborative exchanges. The purpose of this study tour was todeepen understanding of the animal health and welfare industry in the UK, draw lessons from its experiences, and furtherpromote the safety of animal-derived foods. Additionally, Muyuan actively contributed to the development of theLivestock andPoultry Welfare Farming Technology Guide Seriesorganized by CAFA, jointly advancing the development of animal welfarepractice standards.
Participate in Animal Welfare Activities
Introduction to the IKEA BetterPig Welfare Pork Programme- Overall Introduction
Aimed to protect animal and human health, produce safe, nutritious, and antibiotic-free animal products，Antibiotic-free pigfarming is the direction for sustainable development in the livestock industry. Muyuan manages the entire chain of antibioticproduction, operation, and usage, strictly regulating and controlling antibiotic use. We actively explore practices for reducingand eliminating antibiotics, devising medium to long-term plans, and systematically transitioning from antibiotic reduction toantibiotic-free pig farming.
Antibiotic Reduction and Antibiotic-free Pig Farming Practices
Muyuan's Three-tier Goal for
Antibiotic-Free Farming
No use of prescribed antibioticsthroughout all stages from nursery tofattening.
Antibiotic-Free Feed
No use of antibiotic growth promoters(AGPs) during the feeding process.Antibiotic-Free Meat ProductsMeat products allow no antibiotics.
Establish a Health SystemBiosecurity：Muyuan has upgraded its biosecurity prevention and control system, focusing on both internal and external
controls. It has refined procedural standards concerning personnel, materials, and other aspects, assigning responsibilities,implementing supervision and assessment mechanisms to reduce the risk of disease transmission.Disease Puri?cation：Muyuan has established puri?cation pathways for 17 diseases. By the end of 2023, the puri?cation ratefor pseudorabies reached 99.95%, with breakthroughs achieved in diseases such as Betaarterivirus suid 1, Circovirus, Ileitis,Pasteurella and bronchiseptica puri?cation. It has obtained 67 Disease-free Zone certi?cations and 148 farms have been selectedas standardized demonstration farms for livestock and poultry farming.Vaccine Immunization：Muyuan actively promotes the evaluation of bacterial vaccines, designing and implementingimmunization programs based on the health status of the pig population in the farms to enhance their resistance to bacterialdiseases.
Progress in Antibiotic ReductionTo comprehensively improve the level of green and healthy breeding and promote the high-quality development of animalhusbandry, Muyuan steadily advances the action to reduce the use of veterinary antimicrobial drugs. Muyuan's farms establishthe concept of healthy breeding, prevention-oriented, and comprehensive management according to the characteristics of diseaseprevalence in the breeding process and the actual needs for prevention, diagnosis, and treatment. They enhance managementsystems, take control measures, ensure implementation, and improve feeding management and biosecurity protection levelsfrom the aspects of "breeding, prevention, regulation, caution, and substitution", thereby promoting the achievement of theantibiotic reduction target in breeding.
Develop scientifically balanced feed formulas tailored to the nutritional needs of pigs at different stages to ensureadequate nutrition and enhance individual resistance and herd health. Regular pathogen monitoring of pig herds isconducted to prevent the spread of pathogens vertically or horizontally.
Breeding
Antibiotic-Free Farming
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Pragmatic and Impactful Responsibility
Implement strict biosecurity measures such as controlling personnel and material access, and actively carry outvaccination and disinfection in the pig farms to reduce the occurrence of viral and bacterial animal diseases at thesource.Prevention
Strictly adhere to regulations on the safe use of veterinary drugs, prohibiting the use of banned drugs and othercompounds. Avoid adding growth-promoting antibiotics, human drugs, or counterfeit veterinary drugs to feed. Adhereto prescription drug and withdrawal period regulations, and use drugs according to labeling instructions for targetedtreatment.
Regulation
All clinical medication is prescribed by licensed veterinarians, selecting drugs with strong sensitivity and good e?cacybased on sampling, pathogen detection, and drug sensitivity testing results. Avoid using multiple antibiotics simultaneouslyif one can effectively treat the condition. Prioritize the use of lower-grade antibiotics and promote precise individualtreatment to achieve "medication reduction" goals.
Caution
In 2023, Muyuan actively explores green veterinary drugs with no residues such as traditional Chinese animal medicineand probiotics to replace some veterinary antibiotics. By the end of 2023, probiotic replacements for antibiotics covered272 farms, e?ectively reducing the use of aminoglycoside drugs.Substitution
Happy Employees
Muyuan continuously enhances its human resources management system by establishing various regulations such asLaborContract Management Measures, Personnel Management System, Leave Management System, Attendance Management System,Comprehensive Compensation Management System,andReserve Cadre Management System. These regulations standardize themanagement of recruitment, promotion, compensation, and employee bene?ts, e?ectively safeguarding the rights and interestsof employees, addressing their concerns, and enhancing their sense of access to human rights protection, happiness, andsecurity.Muyuan strictly follows the Provisions on Prohibition of Child Laborand other related laws and regulations, prohibits anysubsidiary from recruiting minors under the age of 16 and continuously improves the pre-employment information review
Employment Compliance
Muyuan strictly abides by theLabor Law of the People's Republic of China, Labor Contract Law of the People's Republic ofChinaand other relevant laws and regulations, and consistently upholds the principles of equality and non-discrimination inemployment, treating employees of di?erent genders, regions, races, and religious beliefs fairly and impartially. We promote theconstruction of a diversi?ed workforce, respect and safeguard the rights and interests of employees, and ensure their occupationalhealth and safety, making every e?ort to build harmonious, stable, and healthy labor relations.
Respect and Protect Employees
mechanism to avoid the use of child labor. In 2023, the Company did not have any incidents involving the employment of childlabor or forced labor.Muyuan follows the principles of "equality, voluntariness, and mutual agreement" when signing written labor contracts withemployees. The contract texts are approved or supervised by local labor departments and include provisions on contract term, jobdescription and location, working hours, rest and vacation, remuneration, labor protection, and occupational hazard prevention,meeting the requirements of essential clauses stipulated by labor contract regulations. Additionally, the Company strictly adheresto legal working hours, and overtime work is strictly regulated through an application process that requires approval beforeovertime can be conducted.
Muyuan has established cooperative relationships with over 80 universities and colleges, conducting more than 200campus recruitment activities. These recruitment sessions cover various specialties including pig production, veterinary,meat processing, intelligent technology, and feed production, actively recruiting talents from different disciplines andmajors. The Company also organizes special recruitment events for overseas students to attract outstanding international talents.All these recruitments are aimed to build a young, international, and professional talent pool to empower pig farming withintelligence and technology.
Campus Recruitment
80200CooperativeCampuses
Conduct CampusRecruitmentOverOverCare for Employee Development
Muyuan, aligning with its corporate development strategy, has optimized its talent development system to ensure that everyemployee receives systematic and targeted training. Leveraging various aspects such as corporate culture, vision management,goal management, operational management, and professional skills, etc. Muyuan provides comprehensive empowerment andtraining mechanisms. These mechanisms o?er professional and diverse learning platforms and resources to cultivate versatiletalents, thereby facilitating employee growth.In 2023, Muyuan invested 700 million yuan in vocational training, with an average training duration of 148 hours per employee,continuously enhancing labor skills and competitiveness.
Diverse Learning Platforms
Tailored corporate culture training sessions are conducted based on di?erent personnel and business scenarios. Trainingthemes primarily cover values, life perspectives, goal management, integrity, self-discipline, responsibility, and self-navigation, etc.
Corporate Culture Training
Muyuan strengthens the cultivation of technical talent pools, emphasizing safety training and basic skills training for front-line employees. This initiative aims to enhance employees' business knowledge and professional skills.
Business Knowledge TrainingDuring the probation period, employees receive empowerment and certi?cation in concerning the Company's basic rules andregulations, basic professional competencies, and fundamental job-related qualities, to gain fundamental professionalism.
Ought to KnowEmpowerment
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Pragmatic and Impactful Responsibility
The Company has established online intelligent learning platforms such as"Smart Mumu", "Pig Assistant Xiaowei"and"Production Xiaozhi" to disseminate the latest technology, business, and management information tailored to speci?c jobpositions, enabling individuals to access knowledge anytime, anywhere, enhancing learning e?ciency.Online Learning Platform
Corporate Culture Training
The Company promotes learning and growth among participants through mutual assistance, mutual learning, mutualevaluation, mutual examination, and mutual correction, enabling them to acquire new knowledge and master the standardsand techniques necessary for work implementation.Five Mutual Learning Mechanisms
Muyuan implements a comprehensive master-apprentice mechanism at all levels, empowering every employee. Upon joining theCompany, each new employee is paired with a senior sta? member who serves as their mentor, providing training and guidanceto help them quickly adapt to the Company's working environment and job requirements.Comprehensive Mentorship Training Mechanism
Upholding the principle of Allow successors to stand on myshoulders to make their life better, the Company held the15th Ceremony of Apprenticeship in 2023,matching eachnew employee with an outstanding mentor characterized byintegrity, skillfulness, and rich experience. These mentorsare tasked with providing assistance and guidance to theirapprentices in both work and life, helping them adapt tothe work environment, master job skills, and quickly excelin their positions, thereby growing into outstanding talents.The apprentices shoulder the mission, seek advice withhumility, emulate their mentors, stay focused on their goals,and achieve outstanding results. As of now, Muyuan hassuccessfully matched 30,000 mentors with 99,000 apprentices,fostering mutual growth.
Apprenticeship Ceremony
The group photo of the 15th Ceremony of Apprenticeship
Muyuan develops leadership standards and utilizes talent evaluation mechanisms to identify and deploy elite talents. Weimplement precise empowerment for individuals in talent pools and provide newly appointed leaders with training fortransitioning into new roles, matching them with mentors. This process includes talent selection, taking up positions, positiontransitioning and value creation.
Comprehensive Talent Selection Mechanism
Talent Incentives
Muyuan values employees' comprehensive development and is committed to creating a scienti?c, transparent, and diversi?edcareer development path for them. The Company continuously optimizes the construction of talent development channels,broadening both horizontal and vertical growth paths. It links promotion channels with job quali?cations, clearly de?nes postrank requirements, and takes into account employees' personal qualities, professional abilities, individual preferences, andperformance achievements comprehensively. Muyuan aims to cultivate outstanding leaders, ensuring that each individual'stalents are fully utilized in their roles.
Diversi?ed Career Development Opportunities
Muyuan Career Promotion Path
Promotion channel
Vice PresidentChief O?cer / Division Manager
DirectorRegional Production DirectorSenior Engineer (Principal Level)
Senior SupervisorProduction DirectorSenior EngineerSupervisorFarm ManagerEngineerSection ManagerAssistant Engineer
Muyuan shares the fruits of development with its employees under the incentive principles that: rewards will go to anyone whocreates value; whoever creates value ?rst will be rewarded ?rst; those who create more value will get more rewards."It adheres tothe principles of distribution according to work and result orientation, ensuring that employees' contributions are proportionateto their rewards. The Company employs professional salary management personnel to ensure that employees in differentpositions can share the Company's profits. It implements a comprehensive salary system,carries out targeted hierarchicalmanagement, clari?es the salary system and establishes reasonable salary structures and proportions aligning with its corporatestrategy, business strategy, and human resources strategy. Based on job value, skill levels, performance contributions, etc., amulti-dimensional and multi-level salary distribution system is constructed, covering basic salary, position wages, performancewages, performance bonuses, and equity incentives. Employees can obtain comprehensive compensation through outstandingsalaries, equity allocation, promotion, learning and development opportunities, honors, and bene?ts, etc. As of the end of 2023,Muyuan has implemented three employee shareholding plans and three restricted stock incentive plans, with a total of 12,136individuals holding shares. In 2023, the average annual salary of Muyuan employees was 110,000 yuan.
Muyuan's Compensation and Bene?ts System
Comprehensive CompensationExplicit CompensationHonor Implicit CompensationOutstanding
Salary
Performance
Rewards
Loyalty + PerformanceEquity AllocationEquity Incentives
CommercialInsurance Housing Bene?ts Holiday Gifts Catering Subsidies
······
ExperienceOpportunities，Appointment System，
Promotion Across
Generations
Encouragement
andRecognition，
Selection
and Deployment
Commendation,
Honor, Titles
Equity Incentives
LearningTrust andBene?ts PromotionHonor++++++
Technical AllowancePositional Allowance
Group Pro?t Award
Individual Innovation Award
CompensationOpportunitiesUtilization
Learning:
Industry Exchange,
Study Tours,
TrainingOpportunities:
Participation in
Key Projects
Performance Award for BusinessManagement
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Pragmatic and Impactful Responsibility
Muyuan established a full-scene HR Assistant Welfare Platform, identify employee needs, streamline the process of enjoyingbene?ts, and enhance overall employee satisfaction. The welfare platform comprises 8 main sections: Insurance Bene?ts, TalentBene?ts, Workwear Bene?ts, Dining Bene?ts, Housing Bene?ts, Travel Bene?ts, Health Bene?ts, and Family Bene?ts.
HR Assistant Welfare Platform
Muyuan adheres to the philosophy of "making every family and every child happy"and establishes Mother-Child platform. Thisplatform provides children with opportunities for learning and growth, broadening their horizons, enhancing their learning,thinking, and mental models, instilling correct values, and fostering a positive and upward life attitude for happy and healthydevelopment. Parents can exchange ideas, share educational philosophies and methods, learn together and make progresstogether with their children, and serve as role models. In Muyuan, they can build a brilliant future and enjoy a ful?lling life.
Mother-Child Platform Creates Happy Families
Winter/Summer Vacation/Holidays/Weekends
Headquarters/Regional Mother-ChildConference
Winter/Summer
Study Camp
Gifts for Employees'Children
Parent-Child Sports
Bright ChildrenRecommendations
Dual ExcellenceFamily Selection
Interest Classes forEmployees' Children
Muyuan Family Open
Day
Workplace Experiencefor Employees'Children
Social PracticeActivities forEmployees' ChildrenAnnualEnrollment of Employees' ChildrenScholarships for Employees' Children
Promotion of Outstanding Academic
Achievements
Guidance Lectures on CollegeApplication
Building Ju'ai Services Platform, continuously optimizing andimproving to meet market standards. Starting from clothing,food, housing, transportation, education, utilities, health,relationships, entertainment, and finance, the platformprovides employees with a comprehensive life platform.It aims to empower employees to enjoy high-quality life,enhancing their sense of happiness and belonging frommultiple dimensions and perspectives.
Ju'ai Platform enables employees to enjoy high-quality living
Ju’ai APP
Muyuan always regards employees as family members. In accordance with the requirements of theLabor Contract Law of thePeople's Republic of Chinaand relevant laws and regulations, the Company signs labor contracts with employees and contributesto social insurance and housing provident fund. Besides ensuring employees' basic rights and benefits, Muyuan places greatimportance on employee care, continuously striving to create a comfortable working and living environment and providingexcellent welfare bene?ts.
Employee Care
Enables One-click Access to Bene?ts
DailyFamily Education Lecture SeriesChildcare Services for Employees' Children
On August 15, 2023, Muyuan hosted the 36th Mother-Child Conference, themed "Advancing Together, Expressing New Thoughts."Children sang and danced on the stage, showing and breakthrough themselves. Parents shared outstanding educationalphilosophies and methods, deepening mutual understanding and foster mutual care,growth and improvement with children.Mother-Child Conference
The group photo of the 36th Mother-Child ConferenceFamilies serve as the backbone of our employees, and Muyuan's steady development relies on the strong support and dedicationof each employee's family. Muyuan organizes Family Open Days, inviting employees' families to visit Muyuan, tour the industrialchain, learn about Muyuan's culture, experience employees' work, and enhance the sense of belonging and pride amongemployees' families.
Family Open Day
The Group Photo of the Family Open Day Event
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Pragmatic and Impactful Responsibility
Muyuan integrates outstanding educational resources to provide childcare services and a variety of extracurricular hobby classes,enriching the life of employees' children. These activities aim to cultivate hobbies, broaden horizons, and facilitate continuousself-improvement and joyful growth.Childcare Services for Employees' Children
Ju'ai ChildcareHobby Classes
Muyuan organizes 1-day camps, summer/winter camps, domestic tours, and international tours, enabling children to venture outinto the world, explore new things, experience and learn, broaden horizons, and enhance cognition.Study Tours
Study Tours
To enrich employees' life,practice and promote Muyuan culture, and foster a happy work and life environment, we haveimplemented a variety of cultural activities.Cultural Activities Make Employees Happy at Work
National Day GalaSports DaySpring Team Building
Qixi Festival GatheringSpring Festival Reunion Activities
On the eve of National Day, all Muyuan sta? gathered both online and o?ine, presenting various performances such as dance,song medleys, and skits. Through these performances, Muyuan's corporate culture and management philosophy were conveyed,showcasing the Company's commitment to technological innovation, continuous value creation, and the spirit of shoulderingsocial responsibility. It was also an expression of love for the motherland and the most sincere blessings for the country.
National Day Gala
for the Winter SolsticeDumpling Making Activity
The Group Photo of the National Day Gala in 2023
Employee Health Care
Labor Union Resolves Employees' Concerns
Muyuan organizes healthcare services incollaboration with medical institutionsto conduct various healthcare activitiessuch as special check-ups for employees'recovering from COVID-19, oral healthconsultations, and free diagnoses forfemale employees on Women's Day etc.
Muyuan ensures employee health,by organizing vaccination activitiesfor influenza, pneumonia,COVID-19, HPV, etc. In 2023, weserved 327 individuals to preventthe occurrence of diseases.
Muyuan promotes healthknowledge to enhance employeehealth awareness. In 2023, a totalof 69 health education articleswere published.
Health
Disease
Health
The Group Photo of the Sports Day Event in 2023
To enrich employees' life and enhance their physical ?tness, the Company organizes sports days annually. This fosters integrationamong departments, strengthens team cohesion, and cultivates a culture of physical ?tness, allowing employees to enjoy bothwork and life happily.
Sports Day
ActivitiesPreventionEducation
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Pragmatic and Impactful Responsibility
Muyuan pays great attention to employee health by organizing health check-up activities for both employees andmanagement cadres. In 2023, we arranged health check-ups for 108,000 individuals, aiming to enhance employee healthawareness and cognition, and safeguard employee health.
The Company provides comprehensive insurance plans for employees and their families, covering accidental death,supplementary medical care for hospitalization, 36 major illnesses, and death due to illness. The total coverage amounts to500,000 yuan, and the premium can be paid monthly or annually. This helps more employees understand the functions andusage of di?erent types of insurance, and employee satisfaction evaluations are conducted to ensure that the services meetemployee needs, safeguarding the happiness of employees and their families.Implementation of the 2023 insurance plan:
Commercial Insurance
Number of claims
4.51
Amount of claims
million yuan710,000Number of service instances
Retired EmployeesMuyuan pays great attention to the family situation of retired employees, providing care and assistance to those in need.During the Spring Festival, we organized reunion activities and presenting New Year gifts to retired employees. In theseactivities, retired employees gathered together, visited the headquarters and the Company's industrial chain, celebratedthe New Year together, and talked about future prospects, enhancing employees' sense of honor and belonging.
Assistance for Employees in Need
Muyuan conducts long-term surveys on employee support and assistance efforts, enhances the study of compliancemanagement policies for employee welfare and assistance funds, and continuously improves the mechanism for care,assistance, and relief work. The Company aims to provide targeted assistance to employees and their families in need,ensuring that assistance is provided where it is truly needed. This helps employees overcome difficulties in a timelymanner and feel the care of the Company. The Company's labor union organizes regular activities to provide warmth,increasing the breadth and depth of condolences.Implementation of the employee assistance plan in 2023:
2,155
Number of Assistance Instances
60.258
Amount of care andassistance
million yuan
Care for Retired Employees
In terms of women's development, Muyuan prioritizes gender equality and supports the development of women. By the end of2023, there were over 28,000 female employees at Muyuan, with women accounting for 26% of the senior management positions.Among managerial positions, there were 1,786 women, accounting for 16.5%. Additionally, Muyuan adheres to national legalrequirements by providing maternity leave and paternity leave for employees.In terms of women's protection, the Company prioritizes and strengthens the labor protection of female employees during theproduction process, values the working environment for female employees, and continuously improves their working conditions.
Care for Female Employees
Employee Physical Examinations
The Company organizes health check-up activities and health consultations and diagnoses speci?cally for women, and extendshealth and blessings to all female employees on Women's Day. Additionally, the Company actively implements regulations onmaternity leave and breastfeeding leave, as well as regular health check-up systems during pregnancy and lactation, payingattention to the physical and mental health of female employees.
Muyuan has established and continuously improved regulations and systems for collective negotiation, staff congresses, andlabor union management. It has formulated plans for democratic management to ensure employees' rights to information,participation, and supervision, among other legal rights and interests. The Company encourages employees to actively participatein enterprise democratic management, allowing each employee to contribute to the Company's development.The sta? representative congress is one of the important channels for communication between the Company and its employees.Muyuan has clearly de?ned the basic principles, power scope, and organizational procedures for the construction of the sta?representative congress. It has established and improved the system of sta? directors and sta? supervisors, laying the foundationfor sta? representatives to perform their duties in accordance with the law and participate in corporate governance orderly.To further strengthen democratic management, Muyuan regularly organizes sta? representatives to propose solutions to issuesrelated to enterprise management, salary distribution, employee education, and welfare. The relevant departments collect andprovide feedback on these proposals, establishing a closed-loop feedback mechanism for proposal handling. Muyuan ensures thatsta? representatives receive timely written feedback on proposals that are not accepted, along with explanations for the decision.Muyuan actively organizes and conducts collective negotiation to strengthen communication between the labor union andemployees in order to listen to employees' actual needs. To ensure that employees' rights and interests are properly protected, theCompany has set up anonymous and real-name feedback forms.
Employee Communication and Feedback
The Real-name Employee Feedback ChannelHR AssistantSmart MumuLabor Union HotlineHR HotlineAI AssistantSalary Appeal ChannelAudit Channel
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Pragmatic and Impactful Responsibility
The Company processes reports anonymously according to the reporter's wishes, protecting their information and allowing themto provide genuine feedback without concerns. The feedback may include, but is not limited to issues related to salary, bene?ts,dining services, system operations, personnel transfers, etc., e?ectively safeguarding employees' basic rights and interests. Allreports are handled and feedback is provided.
Employee Anonymous Feedback Channel
Complaint Reporting EmailExclusive Complaint Hotline
Protect Employees' Safety
Muyuan strictly adheres to relevant laws and regulations such asthe Work Safety Law,the Fire Control Law, and theEmergencyResponse Law.It considers safe production operations as the foundation of the Company's development. Muyuan conductsrigorous inspections and assessments, abides by safety standards, strengthens safety protocols, fortifies safety defenses, andcontinuously improves the construction of its safety management system.
Safety Management System
Safety can be achieved with a good management. All safety accidents can be prevented, and all safety hazards canbe controlled.Safety stems from design, quality, responsibility, and capability.Zero tolerance for any violations.Managers at all levels are directly responsible for safety within their scope of business.Safety requires the participation of all employees, and adherence to comprehensive safety managementthroughout the entire process.Employees must undergo rigorous safety training before starting their job.Management cadres at all levels must conduct safety inspections, and any hazards discovered must be recti?edpromptly.All accidents must be reported, analyzed, and addressed promptly.
To excel in safety production, it's essential to adhere to correct principles. Muyuan has formulated eight key safety managementprinciples tailored to its enterprise characteristics, benchmarking against excellent companies. These principles guide theCompany's safety management direction and lay the foundation for its sustainable safety development.Safety Management Philosophy
Each department is the primaryresponsible entity of safetymanagement, and managingoperations must include managingsafety.
Strengthen the responsibility
for safety production
Consolidate the safety productionresponsibilities of each department,eliminate hazards from the sourceof the process, prevent accidents,and achieve intrinsic safety.
Eliminate hazards at thesource of the process
Strengthen management andassessment to achieve a closed-loop safety management system.
Third-partysafety inspection
Safety Management Principles
Operations Management
Department
Safety BPThird-Party Inspection
Pre-employmentManagementWork-related Injuries
Handling
Process TechnologyOn-site ManagementSafety Inspection
Department
Human Resources
Department
Pig Farm Research andOperation Department
Divisions (Production,Logistics, Feed, Slaughter)
Other Departments
Part-time SafetyAdministratorsSafety Management Team
Chairperson of the Safety Committee:
Regional ManagerMembers of the Safety Committee:
Heads of Each Regional Department, Feed SafetyO?cerChairperson of the Safety Committee: SubsidiaryManagerMembers of the Safety Committee: Heads ofdepartments in the subsidiarySecretary-General: Convey and implementinstructions, and manage compliance documents
Regional Safety Management
Committee
Farm Production
Logistics
Environmental ProtectionArea, Harmless Treatment
Workshop
Subsidiary Committee
We have established a three-level safety management structure of "headquarter-region-subsidiary"and formulatedAssessmentStandards for Violations and Hazards. Specific safety performance indicators were set up, linking safety with compensation.Everyone is a safety o?cer,and the implementation of the full-sta? safety production responsibility system.Safety Management Organizational Structure
Muyuan is committed to creating a healthy and safe working environment for its employees. In 2023, the total investment insafety production amounted to 198.25 million yuan, comprehensively advancing safety production and occupational healthmanagement to ensure controllable risks and a sustained and stable safety situation.The Company continuously strengthens risk prevention and control, building a dual prevention mechanism which includes thesafety risk classi?cation and control mechanism and the hidden danger investigation and governance mechanism. It regularlyorganizes special safety inspections for each business line and department to eliminate safety weak links.An Overview of Safety Risks in Workplace Operations is produced to control hazardous operations. Measures such as onlineapproval before, during, and after operations, offline supervision, and video monitoring are implemented. Safety riskmanagement for contractors throughout the entire cycle and important risk prevention and control content for extreme weatherare also emphasized.
Identi?cation and Prevention of Safety Risks
Production Safety o?cer
Safety O?cer of Environmental
Protection Logistics
Feed Mill Safety O?cer
Safety O?cer in otherDepartments
Headquarters SafetyProduction Committee
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Pragmatic and Impactful ResponsibilityFurthermore, special efforts are made for confined space operations, including process technology upgrades, protectionequipment upgrades, and electrical process safety optimizations, to continuously reduce inherent safety risks and enhanceintrinsic safety levels.
In June 2023, Muyuan conducted the Safety ProductionMonth activity with the theme "Everyone Talks about Safety,Everyone Knows Emergency Response". The activity focusedon conducting major accident hidden danger investigationand rectification, special rectification of confined spaces,certification of skills for personnel engaged in hazardousoperations, and aimed to improve the quality of riskinvestigation and rectification and further enhance safetyawareness.In November 2023, the Fire Safety Promotion Month activitywas conducted to promote fire safety knowledge amongemployees. Comprehensive emergency drills for evacuation,?re escape, and ?re?ghting rescue were organized to enhanceemployees' ?re emergency response capabilities.
ImplementSpecializedtrainingsessions
620,000Participants in training
Training duration (hours)
100%
Training coverage rate
Through the construction of safety culture, the Company is committed to implementing safety production awareness andestablishing a long-term mechanism for safety production. All employees are deeply engaged in studying the important expositionson safety production by General Secretary Xi Jinping, watching relevant documentaries such asLife Is More Precious than MountTaiandSafety First, Law in Mind. The Company organizes safety competence certifications for all employees to strengthenthe safety production responsibility system and clarify the bottom-line responsibilities.Managers at all levels actively carry out safety commitments, promotions and practices the Company's safety productionmanagement ideas and risk prevention and control measures, enhancing employees' safety awareness and safety skillsTraining Data of 2023:
Safety Culture Construction
TheSafe Muyuanplatform was established to enhance employees' awareness of safety precautions and emergency responsecapabilities through safety education and information sharing. By real-time dissemination of key information such as safetystandards, accident cases, safety guidelines, and weather warnings, the platform helps employees understand risks, standards,and emergency response procedures.
Occupational Health Management
The Company actively implementsLaw of the People's Republic of China on the Prevention and Control of Occupational Diseases,earnestly fulfills the requirements of the notification on occupational health supervision, and adheres to the principles ofscienti?c development, prioritizing prevention and combining it with control.Identifying occupational hazards such as dust, noise, and high temperatures, the Company strengthens training on occupationalhazard prevention and control, enhances the overall awareness of occupational safety and hygiene among all employees, activelycontrols occupational hazards, eliminates the occurrence of occupational diseases, hence improves the prevention and controllevel of occupational hazards. Focused on improving the working environment and enhancing employees' occupational health,it conscientiously implements the promotion of occupational disease prevention and control, the establishment of a trainingmanagement system, the provision of personal protective equipment, and the prevention measures of dust and noise etc.,continuously improving the working environment for employees.Contractor Safety and HealthMuyuan values the enhancement of contractor safetyawareness and management capabilities. It has formulatedregulations such as theSafety Management Regulations forConstruction Parties, Partners, and Other Relevant Parties,clarifying requirements for contractor safety qualificationreview, as well as safety supervision, management, inspection,and assessment processes during on-site construction andspecial operations.Before entering the site, contractor personnel undergo healthexaminations. Site managers and personnel are requiredto participate in safety production education and trainingorganized by Muyuan, promoting effective enhancement ofsafety risk awareness among contractor personnel.
Safety Emergency ManagementMuyuan has established an emergency management organizational structure for safety production and formulated specialemergency plans such asEmergency Plan for Water Cuto? Accidents in Pig Farms, Emergency Plan for Fire Accidents in Multi-story Pig Buildings, andEmergency Plan for Power Outages. It has also equipped emergency supplies, strengthened emergencydrills, and enhanced the Company's ability to respond to sudden safety incidents and control safety risks.
Sustainable Supply Chain
Adhering to the commercial civilization concept of "fairness, uprightness, openness, and transparency, simple, worry-free,e?cient and win-win cooperation", Muyuan has actively built a sharing platform for industrial interconnection and establishedmulti-dimensional cooperative relations with partners. Muyuan continuously improves the sustainability of the supply chain fromadmission assessment, ESG management, and funding etc. Muyuan assists in the development and management upgrade of theentire industry chain, enhancing e?ciency, reducing costs, achieving optimal value, creating an industrial ecosystem, and jointlyadvocating and promoting symbiotic and win-win commercial civilization.
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Pragmatic and Impactful Responsibility
The Company incorporates quali?cation requirements for health and safety, environmental protection, and other aspects into thesupplier quali?cation audit process. It evaluates suppliers' ESG performance in areas such as environmental protection, resourceconservation, integrity, and safety management to encourage suppliers to continuously improve their governance capabilities andadhere to the concept of sustainable development.
Supplier Management
Supplier Admission Management
At the supplier admission stage, assessments are conducted in various aspects including supplier qualifications, integritymanagement, HSE (Health, Safety, and Environment) management, employee rights and bene?ts, ?nancial credibility, personneltraining, food safety, biological safety, etc. Procurement personnel conduct on-site inspections of suppliers. After passing theassessment pof compliance with admission standards, suppliers ought to sign agreements such asSupply Agreement, SupplierHonesty & Integrity Agreement, Biological Security Commitment, Declaration of Supplier Family Relationships Investigation,Environmental Protection Commitment, etc.
Supplier Evaluation
The audit content includes quali?cation requirements such as HSE system certi?cation, quality management system certi?cation,pollution discharge permit, energy management system certi?cation, etc.Supplier Quali?cation Review
The Company conducts supplier due diligence through on-site inspections and interviews. Specific content includes but isnot limited to production operations, equipment and facilities, company personnel, internal control management, financialmanagement, etc. Suppliers demonstrating poor performance in environmental, labor, and ethical aspects would be cautioned bythe Company. In severe cases, cooperation relationships may be terminated.
Supplier Due Diligence
Muyuan has launched an intelligent procurement management system to publicly alert and mitigate risks associated withsuppliers' past delivery quality and contract ful?llment issues.Early Warning Management
Comprehensive Evaluation of Suppliers
Muyuan continues to enhance its supplier periodic evaluation system. Based on suppliers' actual performance in aspects such assupply, quality, price, compliance, strategic coordination, integrity, and social responsibility, quarterly, semi-annual, and annualevaluations are conducted, followed by grading management based on evaluation results. Partners are certi?ed annually withratings of AAAAA, AAA, A, or B and granted corresponding incentive and penalty measures according to the annual performanceevaluation results.Muyuan focuses on key areas such as bidding, raw material procurement, and other material procurement. We aim to build acomprehensive procurement management and supervision platform. This platform will facilitate online management throughoutthe entire supplier management life-cycle, including introduction, evaluation, rewards, and elimination. We will dynamicallyoptimize the features of our intelligent electronic procurement platform and publicly announce supplier rewards and penalties.This ensures e?cient interaction of information and enhances the speed of information ?ow circulation.
Digital Procurement Supervision Platform
Muyuan conducts supplier training, focusing on integrity, biosafety, supply chain ?nance, and logistics visualization. We growtogether with our suppliers and has empowered 2,133 suppliers through training in 2023.Supplier Training and Empowerment
Muyuan actively promotes suppliers to conduct business activities in line with the same value principles. Drawing reference fromthe OECD Guidelines for Responsible Business Conduct and UN Global Compact Initiative etc., we have established a partnershipESG management system, integrating ESG into procurement strategies and business processes. To this end, we have formulatedand released The Code of Conduct for Muyuan Suppliers. With reasonable notice, we reserve the right to audit suppliers toassess their compliance with this code. Based on audit results, we may increase or decrease procurement volume from relevantsuppliers, guiding them to enhance their sustainable development performance.
Supply Chain ESG Management
Key issuesThe requirements of the Code of Conduct for Muyuan SuppliersLabor environment
Suppliers should create a safe, digni?ed, and fair working environment for their employees, ensuringthat no discrimination or threats occur based on factors such as skin color, race, gender, or religion.They must prohibit the use of child labor and forced labor, and commit to eliminating abuse andharassment in the workplace.
Health and Safety
Working Environment and Conditions: Suppliers must provide employees with a clean, safe officeenvironment and necessary facilities and equipment.Occupational Health and Safety: Suppliers should establish procedures and systems for preventing,managing, tracking, and reporting work-related injuries and illnesses.Emergency Prevention System: Suppliers should establish disaster prevention and emergency responseplans, conduct regular emergency drills, and equip relevant tools and equipment.Environmental
Protection
Suppliers must possess relevant environmental permits as stipulated by national environmental lawsand regulations. They should adhere to relevant laws and regulations, strengthen management ofwater resources, wastewater, exhaust gas, solid waste, etc. They should take actions to reduce GHGemissions and engage in or support practices bene?cial to biodiversity conservation and deforestationrisk avoidance.
Business ethics
Anti-Bribery: Suppliers are forbidden directly of indirectly to promise,o?er bribes to, or accept bribesfrom government o?cials, political parties or groups, and other commercial entities with the purposeof obtaining or retaining business or attempting to influence decision-makers. Suppliers must notattempt to gain undue bene?ts or maintain cooperation with Muyuan by bribing Muyuan employeesor offering improper benefits. They must adhere to the principle of honest operation and refrainfrom defaming or damaging the reputation of Muyuan and its peers. Unauthorized commitments areprohibited, and monopolizing the market or engaging in unfair competition is not allowed.
Management system
The financial condition and business activities of the suppliers should be subject to supervision byauditing units, and undergo independent economic examination and evaluation conducted by auditingunits regarding authenticity, legality, and e?ectiveness of ?nancial income and expenditure, as well asother economic activities.
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Pragmatic and Impactful Responsibility
Muyuan continuously strengthens integrity and anti-corruption efforts, creating a cooperative environment characterized byintegrity, harmony, and cleanliness. Muyuan and its suppliers strictly adhere to various laws and regulations, mutually superviseeach other, and work together to foster an atmosphere of honesty and integrity in cooperation.
Supply Chain Anti-Corruption Management
Before supplier admission, a security deposit for integrity and honesty must be paid. If the supplier violates the integrity andhonesty agreement during the cooperation, the security deposit will be deducted.Security Deposit System
Muyuan signsIntegrity Agreementswith suppliers, requiring them to participate in integrity and honesty lectures and completeonline examinations, before cooperation commences. The agreement prohibits bribery, improper transactions, falsi?cation, andother behaviors, with strict penalty measures in place. In 2023, the signing rate of integrity agreements with suppliers reached100%.
SignIntegrity Agreement
In 2023, Muyuan holds monthly supplier training meetings in each province and region, covering topics such as qualitymanagement, anti-corruption and integrity, striving to create a favorable business environment, and achieve integrity and mutualbene?t.Integrity Training
Muyuan establishes a mechanism for integrity and honesty reporting and formulates Reporting Reward System,implementing all-sta? reporting, providing diverse reporting channels. External reporting channels directly connect to Muyuan's Audit Department,encouraging suppliers to report issues related to integrity and honesty, with protection of the informant's information. In 2023,the Audit Department handled a total of 126 cases of integrity and honesty violations by suppliers, blacklisting 86 externalcollaborators. Individuals and units responsible were all subject to serious sanctions in accordance with the company's integrityregulations.
Supervision and Reporting Mechanism
Muyuan continuously strengthening its anti-corruption e?orts,focusing on consolidating the foundation of supervisionwork and critical time points such as New Year and NationalDay. Innovating supervision measures, enriching warningeducation methods, and deeply promoting the construction ofcorporate integrity culture to vigorously create an atmosphereof integrity within the company.
Foster a Culture of Integrity
Muyuan adheres to the noble vision of "serving customers and promoting the high-quality development of the pig industry."Starting from the development needs of industry chain partners and leveraging finance as a catalyst, Muyuan constructsan industry chain financial service platform. This platform efficiently integrates core enterprise business data, governmentadministrative data, and internet big data to achieve adequate data sharing and integration among banks, government, andenterprises.In 2023, Muyuan continues to empower industrial development with ?nancial resources, deepening cooperation with ?nancialinstitutions such as Agricultural Bank of China Limited(ABC) and Bank of China(BOC). It innovates various ?nancing schemesincluding reverse factoring, accounts receivable pledge, warehouse ?nancing, in-transit goods ?nancing, and order ?nancingplans, providing multi-scenario, full-cycle supply chain ?nancial services for partners along the industrial chain. Cumulatively,it has helped 1,780 cooperative partners obtain 16.909 billion yuan in supply chain financial support, facilitating win-windevelopment among various participants in the industry chain and jointly promoting the high-quality development of the porkindustry.
Financial Services Empower Suppliers
Supplier Services
To address issues such as insu?cient transparency of supply and demand information, severe inventory backlog, long supplycycles, and high distribution costs, Muyuan has implemented the centralized warehouse model. This initiative aims to createa one-stop supply chain management service platform, enabling digital collaboration and providing end-to-end supply chainmanagement services from suppliers, central warehouses to clients. Leveraging professional pig-raising materials, a smart mall isconstructed to facilitate automatic customer demand reporting, and intelligent replenishment,order placement and delivery bycentral warehouses, thereby enhancing overall supply chain e?ciency.Currently, 24 central warehouses have been established and operated, providing e?cient, cost-saving, and secure warehousingand distribution services to 500 high-quality suppliers. These warehouses have serviced goods worth 1 billion yuan, facilitatingnationwide distribution of materials for high-quality suppliers while reducing overall logistics costs in the supply chain,improving supply e?ciency and product quality, and lowering the biological safety risks of supplier products.
Implement Centralized Warehouse Model to Enhance Supply Chain E?ciency
Centralized Warehouse
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Pragmatic and Impactful Responsibility
Muyuan has established a feed management platform to evaluate and analyze the quality of raw materials from upstreamsuppliers. It monitors the quali?cation rate of corn and wheat upon arrival and digitally displays the nutritional indicators of eachraw material based on its source.
Raw Material Procurement Management Platform
Sustainable Procurement
Soybean meal - one of the soybean crushing products - is our important raw material during the pig production process. Muyuanfocuses on holistic sustainable development and continuously increases the proportion of sustainably sourced soybean productsin its procurement.Simultaneously, Muyuan advocates upstream soybean product suppliers to reduce deforestation in soybean cultivation andactively monitors progress. This is to prevent the risks of deforestation and habitat losses associated with soybean procurement.Muyuan also requires suppliers to respect the rights of local communities or indigenous peoples, comply with all eightfundamental conventions of the International Labour Organization, and respect internationally and nationally designatedprotected areas without damaging endangered species de?ned by international or national authorities.Muyuan annually verifies the progress and results of supplier sustainability certification and will further encourage moresuppliers to achieve sustainable soybean certi?cation.In 2023, soybean products directly or indirectly purchased from suppliers with sustainable certi?cations accounted for 52.56% ofthe total, with an expected increase to 70% by 2025. The Company does not directly purchase soybean feed from farmers.
Community DevelopmentMuyuan adheres to the organic integration of corporate development with the sustainable development of the regions where itsbusiness operates. It actively participates in community building, focuses on people's livelihoods and social progress, promotesthe harmonious development of the regional economy and society, and achieves sustainable development of pig farming inharmony with the environment and society.Enhance Community CommunicationDuring project construction, Muyuan has established a social impact assessment procedure covering key pre-operation stagessuch as project proposal development, construction plan formulation, and environmental protection acceptance. This ensuresthat the project life-cycle complies with national and local environmental laws and regulations to protect the interests of thecommunity and the public as much as possible.
Community Impact Assessment
Muyuan has compiled the environmental protection section in the project design and feasibility study reports,conducted identi?cation of environmental sensitive targets, and formulated corresponding pollution prevention andecological protection measures in accordance with national and local environmental policies and the company'smanagement systems.Muyuan has initiated environmental impact assessments, commissioned third-party evaluation agencies to prepareenvironmental impact assessment reports, and integrated the requirements of environmental impact assessmentapprovals into the environmental protection section of the construction plan. During the public participation phaseof the environmental impact assessments, Muyuan has sought opinions and suggestions from the surroundingcommunity.Once the project construction is launched, Muyuan strictly implements environmental protection measures duringthe construction phase in line with the environmental assessment requirements, conducts regular inspections on theenforcement of these measures, and timely organizes environmental protection acceptance for the completion of theproject, ensuring the project's legal and compliant operation and production.
Muyuan values collaborative development with the communities where it operates. While conducting various business activities,the Company promptly identi?es, assesses, and resolves potential con?icts between the community and the Company. It hasestablished community communication mechanisms and development engagement plans, respecting the cultural customsand behavioral norms of the community, and promoting a win-win situation for both enterprise development and communityprosperity.
Community Communication Mechanisms and Channels
The Company sets up convenience service signs at the entrances ofeach pig farm and posts internal communication channels in villagesto receive environmental issues and other demands raised by localcommunity villagers. The pig farms actively respond to the demandsof the masses and provide assistance accordingly, promptly resolvingconflicts between villages and enterprises to ensure harmony andsmooth operations in the vicinity of the farming areas. A designatedperson is responsible for following up on the demands of thesurrounding community, actively accepting social supervision. Ifcommunity residents have any relevant opinions or demands, they cancontact the relevant personnel by phone for feedback. The Companypromises that upon receiving feedback from residents, the specializedresponsible person of the backend region will contact those involvedwithin 30 minutes, discusses and devises a solution within 2 hours,and issues an investigation report and solution agreement within 12hours, which will be publicly announced within the community group.Satisfaction follow-up calls will be made by specialized personnel 7 to15 days later. Monthly agricultural technology service communicationexchange meetings are held to support community development.The Company attaches great importance to feedback from the masses.Currently, an internal reporting management system has beenestablished, covering the entire process from backend acceptance,direct communication with the parties involved, investigation anddecision-making, to reward and follow-up visits. This mechanismenables immediate intervention, as well as face-to-face communicationand resolution of con?icts and contradictions, thereby gaining the trustof the masses, and establishing long-term good relations with residents.
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Pragmatic and Impactful ResponsibilityRural Revitalization
Muyuan upholds the core values of "Create value and serve society; be upright outside and inside, and advance socialdevelopment." As a national key leading enterprise, we leverage the resources, technological, and managerial advantages inagricultural industrialization. Our pig farming business spans 24 provinces (regions) and 103 cities, 217 counties (districts)nationwide, directly creating 131,000 job opportunities. The Company prioritizes employing local villagers, achieving an averageannual income of 110,000 yuan per capita, and attracts 40,000 university students to engage in agriculture, contributing to ruralrevitalization.
Industry Revitalization
Muyuan Flat-Layout FarmMuyuan Multi-Story Farm
Relying on the main pig farming business, more than 1,900 upstreamand downstream suppliers in the agricultural and animal husbandryindustry have been attracted to register in Nexiang. To promotethe rapid growth of this industry and form an industrial cluster,the Nexiang County Committee, government, and Muyuan jointlyplanned and built the Agricultural and Animal Husbandry EquipmentIndustrial Park. Currently, more than 30 agricultural and animalhusbandry equipment enterprises have registered in, with an annualoutput value of 2.5 billion yuan, making it one of the benchmarkincubation bases for agricultural and animal husbandry enterprisesin China and one of the leading industries in the industrial economicdevelopment of Nexiang County.
Agricultural and Animal Husbandry Equipment Park in Nexiang County
Create Per Capita Income110,000
Promote University Graduates Engagedin Agriculture40,000Nationwide Pig Farming Layout
Provinces(Regions)
Counties (Districts)
Citiesyuan / year
Muyuan supports local employment by promoting job opportunities in the communities where its subsidiaries are located, hiringlocal labor for nearby positions to boost local employment rates. As of the end of 2023, the local employment rate reached 76%.Employment Promotion
Muyuan has always adhered to mission of "rooted in one place, bene?ting one place," helping farmers plow and cultivate land,seize farming opportunities, assist in seeding, planting and replanting, and ensure planting quality. Through methods such asdistributing pesticides, providing free drone spraying, and conducting pest control activities, the Company ensures effectivedisease and pest prevention and field management, thereby increasing farmers' yields and income. Muyuan supplies andcoordinates agricultural machinery for farmers free of charge, seizing the golden harvest period to ensure food security. It alsoengages in weeding, binding straw, and removing crop residues from the ?elds, laying a solid foundation for next season's cropplanting. In 2023, Muyuan's investment in farmer support services totaled 31.0522 million yuan.
Agricultural Assistance Services
Muyuan adheres to the principles of fairness, openness, and transparency in procurement, expanding local grain procurementto contribute to community economic development. In 2023, the cumulative procurement of local grain reached 19.8768 milliontons, an increase of 4.87% year-on-year.Local Procurement
Muyuan has continued to implement farmer-bene?cial welfare projects, which include road construction, road lamp lightingenhancement, plaza development, greening initiatives, and water supply engineering. By the end of 2023, Muyuan hadcumulatively donated a total of 104.2622 million yuan to these welfare initiatives, bene?ting 1,609 villages. These e?orts havecontributed to creating a more beautiful, safe, and convenient living environment for community residents, significantlyimproving the quality of life for the local populace.
Beautiful Countryside Construction
Bene?ting and Assisting Farmers
Total Increase in AgriculturalIncome per Mu per Year
352.27
yuan
Total Increase in AgriculturalIncome for 2023
1.482
billion yuanPersons Accepting EmpowermentTrainings298,300
Villages Covered
13,035
Agricultural Technical Services
9,759
sessionsFarms Served
million mu
4.5207
Organic Fertilizer Yield
tons519,000
Muyuan vigorously develops the circular economic model which integrates "pig farming - liquid fertilizer - green agriculture",serving the green development of agriculture, helping farmers reduce costs and increase e?ciency, attracting college-educatedtalents to return to and revitalize agriculture, and consolidating the achievements of poverty alleviation.Currently, the Company has a team of 300 professional agronomists rooted in rural areas, deeply cultivating techniques forsubstituting chemical fertilizers with manure. They provide technical training for farmers on crop planting and productionmanagement based on crop growth cycles, ensuring precise disease prevention and fertilization. This helps farmers masterplanting techniques and improve their abilities in selecting good seeds and preventing and controlling diseases and pests.
Help Farmers Increase Income
Muyuan extends the industry value, promotes the full-chain upgrading of rural industries, and achieves integrated developmentof the primary, secondary, and tertiary sectors. With an annual procurement volume exceeding 100 billion yuan, Muyuan workswith nearly 10,000 supply chain companies spreading across the country to co-build an industrial ecosystem. This collaborationhas led to an employment of 470,000 people, enabling more enterprises and the public to share in the development achievementsof Muyuan.
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Pragmatic and Impactful ResponsibilitySupport EducationSince 2003, Muyuan has continuously carried out "Ju'ai Education Assistance" series of activities, including theAutumn Program,Spring Seedling Program, Spring Rain Program, Morning Dew Program, andDawn Program, to improve rural educationconditions, support community and rural education development, nurture outstanding talents for society, and promote socialprogress.Rural Education
Since 2003, Muyuan has integrated the performance evaluation of enterprises with teacher incentives, implementing rewardsthrough awards plus subsidies to inspire teachers. This not only promoted a culture of respect for teachers but also createda good social atmosphere, thereby motivated teachers' teaching ethusiasm and improved the education level. By the end of2023, cumulative donations reached 102 million yuan, honoring 30,700 outstanding education workers, bene?ting 520 schoolsnationwide.
Ju'ai Education Assistance Project - Spring Rain Program
Since 2005, Muyuan has annually conducted the "Ju'ai Education Assistance Project - Golden Autumn Program" to rewardoutstanding college students and encourage them to learn, support education development, nurture talents for society, andpromote social progress. By the end of 2023, over 80,000 outstanding college students had been rewarded, with a cumulativeamount of 235 million yuan. In 2023 alone, rewards totaling 64.39 million yuan were distributed to 21,600 students.
Ju'ai Education Assistance Project - Golden Autumn Program
Since 2017, to improve the educational conditions for rural children, Muyuan has donated school bags, stationery, and otherlearning essentials to children in rural areas, supporting community education development and helping rural children grow.By the end of 2023, over 620,000 love bags had been distributed to primary school students nationwide. In 2023, 77,933 love bagpackages were distributed, spreading love and responsibility and creating a better future together.
Ju'ai Education Assistance Project - Spring Seedling Program
Muyuan hosted a four-day "Muyuan Open Day" event in June 2023, inviting over 1,000 guests from various enterprises, industryassociations, universities, and media to visit Muyuan and collaborate on shared development.
Industry SharingMuyuan Open Day,Share 400 Billion Potential Development Space
In May 2023, Muyuan donated 100 million yuan in cash to the West Lake Education Foundation of Hangzhou Cityfor the construction and development of Westlake University and related public welfare education and scientificresearch undertakings, including but not limited to the long-term development of various aspects like talentdevelopment, discipline construction, infrastructure construction, student cultivation, academic exchanges,research, and other personnel salary subsidies, etc.
Support the Cultivation of Scienti?c Research Talents Nurturing
On June 18th, Muyuan led guests through the Company's cultural exhibits, Muyuan Intelligent Technology Museum, and MuyuanMeat Industry Complex, sharing the Company's development achievements.
Visit to Muyuan Industrial Chain
Visit to Neixiang ComplexVisit to Muyuan Intelligent Technology Museum
On June 19th, the Muyuan Pig Festival's Co-creation and Sharing Forum opened with an opening speech by Chairman QinYinglin. He deeply elaborated on the theme of the forum, breaking down the 600 yuan cost space in the pig farming industryCo-creation and Sharing Forum - Focus on Breeding Pigs Management and Health Management
Co-creation and Sharing Forum
across ?ve aspects: feed, breeding pigs, health, pig raising, andslaughtering. He indicated that the industry has a 400 billionyuan potential for development, expressing the hope for futureco-creation, sharing, and joint growth.Li Yanpeng, chief operating officer of Muyuan pig raising,chaired the breeding pig management forum, where ZhuHongqian, director of the breeding department, shared pigbreeding experience. Niu Min, director of the veterinarydepartment, chaired the health management forum anddelivered the opening reportAnalysis of the Health ValueSpace in Muyuan Pig Raising.
On June 20th, Li Yanpeng, chief operating officer of Muyuan pig raising, shared the reportDigitalization of ProductionManagementand proposed that Muyuan's efforts to tap into the 600 yuan per head cost space in pig raising are inseparablefrom informatization. By building a system of production digitization, management re?nement, business informatization, and?nancialized operations, Muyuan aims to achieve optimal management of pig e?ciency, labor e?ciency, and material e?ciency,enhancing production e?ciency.At the feed nutrition forum, Chairman Qin Yinglin delivered a keynote speech on "Future Trends in Feed Nutrition," sharinginsights on realizing the cost reduction of 37 yuan per head in feed section through decreasing feed waste and improving feedutilization e?ciency within the 600 yuan per head cost space for pig raising. He also discussed Muyuan's practical experience inpromoting low-soybean meal diets.
Co-creation and Sharing Forum - Focus on Production Management, Feed Nutrition, and Corporate Management
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Pragmatic and Impactful Responsibility
Group Photo of the 18th Muyuan Pig Raising Festival and Awards Ceremony
The 18th Muyuan Pig Raising Festival and Awards Ceremony
On 21 June,guests were invited to the 18th Muyuan Pig Raising Festival and Awards Ceremony. Muyuan people demonstratedisruptive innovation ideas, continue to set new standards, put out new questions and carry forward innovative spirit. On theCeremony, we recognized their achievements according to their performance, and awarded excellent employees particularly, soas to encourage more Muyuan people break new grounds.A "Million Dollar Award" was also established for experts, scholars, andentrepreneurs who have made outstanding contributions to the pig farming industry. Additionally, the forum featured specialawards such as theGolden Lecture Award, Excellent Solution Award,and Golden Idea Award, to recognize guests who deliveredkeynote speeches and shared valuable content during the interactive sessions.
Muyuan actively participates in and organizes industry exchange activities, sharing development achievements at events suchas the Leeman Conference, the 2023 World Agricultural Science and Technology Innovation Conference, the 4th InternationalVeterinary Diagnostic Conference, the 2nd (2023) China Animal Husbandry Digitalization Summit, the 8th IFS China Theme Dayand Food Safety Walk Annual Meeting, and the 19th Livestock and Feed Technology and Economy (Global) Summit, promotingindustry-wide advancement together.
Actively Engaged in Industry Communication, ShareDevelopment Fruits
The 19th Livestock and Feed Technology and Economy (Global) Summit
On 18 to 20 April 2023, Muyuan co-hosted the 19th Livestock and Feed Technology and Economy (Global) Summit withtheOrganizing Committee of the Livestock Feed Technology and Economy (Global) Summit and the National Swine IndustryTechnology Innovation Center. They engaged in discussions on industry focal issues to explore high-quality development for theindustry.
The 19th Livestock and Feed Technology and Economy (Global) Summit
During the summit, Chairman Qin Yinglin delivered a keynote speech titled "Seek Breakthroughs at the bottom of the Businessand Promote Sustainable Development," explaining the opportunities and challenges faced by the industry. He showcasedMuyuan's e?orts and achievements in starting from the technological origin and achieving business breakthroughs. Li Yanpeng,chief operating o?cer of Muyuan Pig Raising, introduced Muyuan's pig raising goals, disease puri?cation, and the applicationof information and intelligent technology. Vice president Chu Ke, along with other entrepreneurs, discussed the topic "BreakingThrough and Transforming the Chinese Feed Industry" at the feed industry sub-forum.
Roundtable Forum Guests Visit to Muyuan Culture
From April 9 to 11, 2024, the first International Pig Digestive Disease Symposium（IPDDS）was successfully held at Muyuan.Muyuan participated in the preparation of the conference, with key personnel joining the academic committee to discuss theconference themes and report directions. Experts and scholars from 11 countries gathered at this meeting for in-depth academicexchange and discussion, contributing wisdom to the high-quality development of the livestock industry.
The First International Pig Digestive Disease Symposium（IPDDS）
The Release Ceremony of The Guide of ESG Information Disclosure for Animal husbandry Enterprises
Muyuan actively promotes ESG practices and participates in the formulation of industry standards to promote industrydevelopment. In September 2023, Muyuan, in conjunction with the China Animal Agriculture Association, the Sanya EconomicResearch Institute, and other relevant organizations, jointly releasedThe Guide of ESG Information Disclosure for Animalhusbandry Enterprises. This standard aims to promote sustainable development in animal husbandry, enhance product qualityand safety, improve supply chain risk management, establish social responsibility of livestock industry, integrate public interestsinto the corporate value system, and thus promote the common improvement of corporate and social values, driving high-qualityand common development in the animal husbandry industry.
Participate in Industry Standards Formulation, PromoteIndustry Development
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Muyuan Foods Co., Ltd. 2023 Environmental, Social, & Governance Report
Looking ahead to the future in the new era of development, Muyuan will continue to focus on sustainable development goals,upholding the corporate core value of "creating value and serving the society". We will persist in our "Five Commitments"sustainable development strategy, namely food safety, environmental protection, win-win cooperation, employee care and publicwelfare. Our aim is to pursue excellence, produce high-quality products, and achieve shared value creation.
Future Prospects
Food SafetyMuyuan will always prioritize providing high-quality products. We will continue to enhance our food safety and qualitymanagement system to ensure the production of 100% safe and healthy pork products. Our focus remains on nutritional researchto meet people's demands for a better quality of life.Green and Low-carbon Practices
We actively address climate change by adhering to green development principles. Muyuan actively responds to climate change byadhering to green development principles and innovating the crop-livestock cycle. The Company explores new paths for energyconservation, environmental protection, and sustainable agricultural development, focusing on soil preservation and waterconservation, thus promoting high-quality green development in the industry.
Win-win CooperationMuyuan consistently upholds the principles of open cooperation and mutual bene?t, continuing to work with partners to buildan industrial ecosystem and create a harmonious and shared industrial system. This contributes to the innovative development ofthe industry.Employee CareMuyuan adheres to the principle of bene?ting employees. We will continue to provide a harmonious and equitable space foremployee growth and development, working hand in hand with employees to realize shared value.
Social WelfareMuyuan will continue to demonstrate corporate responsibility as the industry leader, supporting rural revitalization and economicdevelopment, and building beautiful villages. We will continue our e?orts in supporting education, helping the disadvantaged,and jointly creating a better life for all.
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Muyuan Foods Co., Ltd. 2023 Environmental, Social, & Governance Report
Muyuan's ESG Key Performance
Appendix
IndexUnit202320222021Pigs Produced10,000 heads6,381.66,120.1 4,026.3Pigs Slaughtered10,000 heads1,326.0736.2289.9Feed Production10,000 tons2,3172,0371,579Operating Revenue100 million yuan1,108.611,248.26 788.90Net Pro?t100 million yuan-41.68149.33 76.39Total Assets100 million yuan1,954.051,929.48 1,772.66Dividends Paid100 million yuan40.0314.8856.61Tax Paid100 million yuan8.0811.628.45Board MembersPerson777Independent DirectorsPerson333Percentage of Independent Directors%434343Female DirectorsPerson111Percentage of Female Directors%141414Supervisory Board MembersPerson333Female SupervisorsPerson111Percentage of Female Supervisors%333333Employee Representatives on the Supervisory BoardPerson111Percentage of Employee Representatives on the Supervisory Board%333333R&D PersonnelPerson6,6816,1344,632Percentage of R&D Personnel%5.094.373.37R&D Expenditure100 million yuan16.5811.428.08Percentage of R&D Expenditure%1.500.921.02Patents Authorized During the Reporting PeriodItem185557250Cumulative Number of Authorized PatentsItem1,6261,441884
Governance Performance
IndexUnit202320222021
Resource
Usage
DieselLiter79,547,301.79 81,893,303.65 70,072,490.09GasolineLiter14,082,124.55 12,061,076.1518,417,548.36Gasm
124,220,654.99218,839,075.60 129,469,790.60ElectricityMWh6,045,117.825,142,753.02 4,328,154.29Total Energy Consumptionton Standard Coal1,006,482.281,010,437.76 793,881.24Energy Intensitykg Standard Coal/kg pork0.19750.22690.2114Biogas Utilization10,000 m?3,445.072,531.90960.29Biogas Power Generation10,000 kWh1,667.76932.9344.45Photovoltaic PowerGeneration
10,000 kWh3,688.44316.13/Manure Water Reuse10,000 m?348.26307.0052.21
Emissions
Scope 1 Emissions10,000 tCO
e416.47389.45307.65Scope 2 Emissions10,000 tCO
e381.54340.56283.54Total Carbon Emissions 10,000 tCO
e798.21730.01591.19Carbon Reduction 10,000 tCO
e331.12319.72251.06Net Carbon Emissions10,000 tCO
e466.89410.29340.13Carbon IntensitykgCO
e/kg pork0.9640.9981.049Particulate Matter Ton2.200.720.16NOx Ton14.584.430.90SO
Ton1.920.260.27Chemical OxygeonDemand(COD)
Ton128.3688.2439.76Ammonia NitrogenTon2.992.300.604Total NitrogenTon79.4552.4513.54
Environment Performance
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Muyuan Foods Co., Ltd. 2023 Environmental, Social, & Governance ReportSocial Performance
Performance IndicatorsUnit202320222021
Employment
EmployeesPerson131,276140,403137,520Male EmployeesPerson103,032108,581104,422Female EmployeesPerson28,24431,82233,098College GraduatesPerson35,37635,40734,872Retired SoildersPerson5,8906,5616,126Female Employees Percentage%21.5122.6624.07Female Senior Managers Percentage%263127Labor Contract Signing Rate%100100100Labor Contract EmployeesPerson131,276140,403137,520Labor Dispatch EmployeesPerson000Part-time WorkersPerson000Local Employees Percentage%75.9885.5174.90Employees under 30Person39,17245,02948,319Employees aged 30-50Person84,23689,04981,751Employees over 50Person7,8686,3257,450Mainland Employees Person131,276140,403137,520Hong Kong, Macao, Taiwan, and Overseas EmployeesPerson000
Health andSafety
Total Investment in Safety Production
10,000RMB
19,82519,23645,000Employee Health and Safety Training Coverage Rate%100100100Total Duration of Employee Health and SafetyTraining
Hour4443.5 15Full-Time Safety PersonnelPerson623410Employee Physical Examination Coverage Rate%100100100
EmployeeTraining
Employee Training Coverage Rate%100100100First-line Employee Training Coverage Rate%100100100Middle Managers Training Coverage Rate%100100100Senior Managers Training Coverage Rate%100100100Training Expenditure
10,000
RMB
70,00050,00012,800Average Training Duration per PersonHour14810075Training Coverage Ratio%100100100Average Training Hours for First-line EmployeesHour60//
Performance IndicatorsUnit202320222021
Employee Training
Average Training Hours for Middle ManagersHour216//Average Training Hours for Senior ManagersHour168//
Employee Welfare
Social Insurance Coverage Rate%100100100Employee Inquiry Response Rate%100100100
Products and Csutomer Service
Proportion of Sold Products Recalled Due to Safety andHealth Issues
%0//Sales revenue of products sold or shipped but recalledfor safety and health reasons
10,000RMB
0//Timeliness Rate of Complaint Handling for Productsand Services
%100//Illegal and Violation Incidents in Marketing (IncludingAdvertising, Sales Promotion, and Sponsorship)
Case0//Illegal and Violation Incidents in Health, Safety, andLabeling of Products and Services Provided
Case0//Confirmed Complaints of Customer Privacy RightsInfringement and Lost Customer Data
Case0//Illegal and Violation Incidents in Customer PrivacyCase0//
SuppliersResponsibility
Total SuppliersNumber9,500//Suppliers in Mainland ChinaNumber9,500//Suppliers in Hong Kong, Macao, Taiwan, and OverseasNumber0//Proportion of Suppliers Assessed in Environment,Labor, Ethics, etc.
%100100100Proportion of Suppliers Passed Assessment inEnvironment, Labor, Ethics, etc.
%100100100Supplier Training Coverage Rate%100100100Purchase Contract Compliance Rate%99.599.599.0
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Muyuan Foods Co., Ltd. 2023 Environmental, Social, & Governance Report
ItemsDescriptionSections in the Report
GRI 2：General Disclosures
1. Entities and Reporting Practices
2-1Organizational detailsCompany Pro?le2-2Entities included in the organization’s sustainability reportingAbout the Report2-3Reporting period, frequency, and contact pointAbout the Report2-4Restatements of informationAbout the Report2-5External assuranceCorporate Governance
2. Activities and Workers
2-6Activities, value chain and other business relationshipsSustainable Supply Chain2-7EmployeesHappy Employees2-8Workers who are not employeesSustainable Supply Chain
3. Governance
2-9Governance structure and compositionESG Management2-10 Nomination and selection of the highest governance bodyCorporate Governance2-11Chair of the highest governance body
Message From the Chairman,Corporate Governance2-12
Role of the highest governance body in overseeing the management ofimpacts
Message From the Chairman, ESGManagement2-13Delegation of responsibility for managing impactsESG Management2-14Role of the highest governance body in sustainability reportingESG Management2-15Con?ict of interest /2-16Communication of critical concernsESG Management2-17Collective knowledge of the highest governance body /2-18Evaluation of the performance of the highest governance bodyCorporate Governance2-19Remuneration policies
Corporate Governance, HappyEmployees2-20Process to determine remuneration
Corporate Governance, HappyEmployees2-21Annual total compensation ratio /
4. Strategies, Polices and Practices
2-22Statement on sustainable development strategyESG Management2-23Policy commitments
Sustainable Supply Chain, HappyEmployees2-24Embedding policy commitmentsBusiness Ethics2-25Processes to remediate negative impacts
Risk Management, Business Ethics,Happy Employees2-26Mechanisms for seeking advice and raising concerns
Corporate Governance, ESGManagement, Happy Employees
Global Reporting Initiative（GRI）Index
ItemsDescriptionSections in the Report
2-27Compliance with laws and regulationsCorporate Governance2-28Membership associationAnnual Awards and Recognition
5.Stakeholder Engagement
2-29Approach to stakeholder engagementESG Management2-30Collective bargaining agreementsHappy Employees
GRI 3：Materiality Issues3-1 Process to determine material topicsESG Management3-2 List of material topicsESG Management3-3 Management of material topics
Sustainable Corporate Governance,Environmentally Friendly Development,Pragmatic Responsibility AssumptionGRI 201 Economic Performance201-1Direct economic value generated and distributed
Corporate Overview, 2023 ESG HighlightPerformance201-2
Financial implications and other risks and opportunities due toclimate change
Low-carbon Actions201-3De?ned bene?t plan obligations and other retirement plansHappy Employees201-4Financial assistance received from government/
GRI 202 Market Presence
202-1
Ratios of standard entry level wage by gender compared to localminimum wage
/202-2Proportion of senior management hired from the local community
2023 ESG Highlight Performance, ESG
Key Performance TableGRI 203 Indirect Economic Impacts203-1Infrastructure investments and services supported
2023 ESG Highlight Performance,
Community Development, Low-carbon
Actions203-2Signi?cant indirect economic impacts
2023 ESG Highlight Performance,
Low-carbon Actions, Community
Development, Sustainable Supply Chain
GRI 204 Procurement Practices
204-1Proportion of spending on local suppliers
Low-carbon Actions, Sustainable Supply
Chain GRI 205 Anti-corruption205-1Operations assessed for risks related to corruptionBusiness Ethics205-2
Communication and training about anti-corruption policies andprocedures
Business Ethics, Sustainable Supply Chain205-3Con?rmed incidents of corruption and actions takenBusiness Ethics
GRI 206 Anti-competitive Behavior
206-1
Legal actions for anti-competitive behavior, anti-trust, and monopolypractices
Business Ethics, Sustainable Supply ChainGRI 207 Tax207-1Approach to tax Risk Management207-2Tax governance, control, and risk managementRisk Management207-3Stakeholder engagement and management of concerns related to taxRisk Management207-4Country-by-country reportingN/A
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Muyuan Foods Co., Ltd. 2023 Environmental, Social, & Governance Report
ItemsDescriptionSections in the Report
GRI 306 Waste306-1Waste generation and signi?cant waste-related impactsGreen Production306-2Management of signi?cant wasterelated impactsGreen Production306-3Waste generatedGreen Production306-4Waste diverted from disposalGreen Production306-5Waste directed to disposalGreen Production
GRI 308 Supplier Environmental Assessment308-1New suppliers that were screened using environmental criteriaSustainable Supply Chain308-2Negative environmental impacts in the supply chain and actionsSustainable Supply Chain
GRI 401 Employment
401-1New employee hires and employee turnoverHappy Employees401-2
Bene?ts provided to full-time employees that are not provided totemporary or part-time employees
Happy Employees401-3Parental LeaveHappy Employees
GRI 402 Labor/Management Relations402-1Minimum notice periods regarding operational changesHappy Employees
GRI 403 Occupational Health and Safety403-1Occupational health and safety management systemHappy Employees403-2Hazard identi?cation, risk assessment, and incident investigationHappy Employees403-3Occupational health servicesHappy Employees403-4
Worker participation, consultation, and communication onoccupational health and safety
Happy Employees403-5Worker training on occupational health and safetyHappy Employees403-6Promotion of worker healthHappy Employees403-7
Prevention and mitigation of occupational health and safety impactsdirectly linked by business relationships
Happy Employees403-8
Workers covered by an occupational health and safety managementsystem
Happy Employees403-9Work-related injuriesHappy Employees403-10Work-related ill healthHappy Employees
GRI 404 Training and Education404-1Average hours of training per year per employeeHappy Employees404-2Programs for upgrading employee skills and transition assistanceHappy Employees404-3
Percentage of employees receiving regular performance and careerdevelopment reviews
Happy EmployeesGRI 405 Diversity and Equal Opportunity
405-1Diversity of governance bodies and employees
2023 ESG Highlight Performance,
Corporate Governance, Happy Employees405-2Ratio of basic salary and remuneration of women to menHappy Employees
ItemsDescriptionSections in the Report
GRI 301 Materials
301-1Materials used by weight or volume
Low-carbon Actions, SustainableSupply Chain301-2Recycled input materials used
Low-carbon Actions, SustainableSupply Chain301-3Reclaimed products and their packaging materials
Low-carbon Actions, SustainableSupply Chain
GRI 302 Energy
302-1Energy consumption within the organizationLow-carbon Actions302-2Energy consumption outside of the organization /302-3Energy intensityLow-carbon Actions302-4Reduction of energy consumptionLow-carbon Actions302-5Reductions in energy requirements of products and servicesLow-carbon Actions
GRI 303 Water and E?uents
303-1Interactions with water as a shared resourceGreen Production303-2Management of water dischargerelated impactsGreen Production303-3Water withdrawalGreen Production303-4Water dischargeGreen Production303-5Water consumptionGreen Production
GRI 304 Biodiversity
304-1
Operational sites owned, leased, managed in, or adjacent to, protectedareas and areas of high biodiversity value outside protected areas
Ecological Restoration and BiodiversityConservation304-2 Signi?cant impacts of activities, products and services on biodiversity
Ecological Restoration and BiodiversityConservation304-3Habitats protected or restored
Ecological Restoration and BiodiversityConservation304-4
IUCN Red List species and national conservation list species withhabitats in areas a?ected by operation
Ecological Restoration and BiodiversityConservation
GRI 305 Emissions305-1Direct (Scope 1) GHG emissionsLow-carbon Actions305-2Energy indirect (Scope 2) GHG emissionsLow-carbon Actions305-3Other indirect (Scope 3) GHG emissions/305-4GHG emissions intensityLow-carbon Actions305-5Reduction of GHG emissionsLow-carbon Actions305-6Emissions of ozone-depleting substances (ODS)Low-carbon Actions, Green Production305-7
Nitrogen oxides (NOx), sulfur oxides (SOx), and other signi?cant airemissions
Low-carbon Actions, Green Production
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Muyuan Foods Co., Ltd. 2023 Environmental, Social, & Governance Report
Dear readers,Thank you for reading the ESG Report 2023 of Muyuan Foods Co., Ltd. To provide you and other stakeholders with moreprofessional and valuable corporate social responsibility information, Muyuan sincerely invites you to o?er your valuableopinions and suggestions on this Report. Your feedback will help us further enhance our ability and level of social responsibilityand sustainable development management in the future.Optional Questions：
1. Do you think this report comprehensively and accurately re?ects the signi?cant economic, social, and environmental
impacts of Muyuan Shares?Yes□ Fair□ No□
2. Do you think the stakeholders identi?ed in this report and the analysis of their relationships with Muyuan are accurate
and comprehensive?Yes□ Fair□ No□
3. Do you think this report re?ects the signi?cant environmental impacts of Muyuan?
Yes□ Fair□ No□
4. Do you think this report re?ects the signi?cant social impacts of Muyuan?
Yes□ Fair□ No□
5. Do you think this report re?ects the corporate governance situation of Muyuan?
Yes□ Fair□ No□
6. Do you think the information provided in this report is readable?
Yes□ Fair□ No□Open Questions:
1.What aspects of this report are most satisfactory to you?
2.Are there any pieces of information you need that are not re?ected in this report?
3.Do you have any suggestions for our future ESG report compilation?
Please feel free to provide any other comments or suggestions regarding this report.Your Contact：
Name： E-mail： Tel： Company：
Our Contact:
Address：Muyuan Foods Co., Ltd., Longsheng Industrial Park, Wolong District, NanyangCity, Henan ProvinceTel：0377-65233888Zip code：473000E-mail：o?ce@muyuanfoods.comWebsite：www.muyuanfoods.com
Reader Feedback
ItemsDescriptionSections in the Report
GRI 406 Non-discrimination406-1Incidents of discrimination and corrective actions taken
Happy Employees, Sustainable SupplyChain
GRI 407 Freedom of Association and Collective Bargaining
407-1
Operations and suppliers in which the right to freedom ofassociation and collective bargaining may be at risk
Happy Employees, Sustainable SupplyChainGRI 408 Child Lab408-1
Operations and suppliers at signi?cant risk for incidents of childlabor
Happy Employees, Sustainable SupplyChainGRI 409 Forced or Compulsory Labor
409-1
Operations and suppliers at signi?cant risk for incidents of forcedor compulsory labor
Happy Employees, Sustainable SupplyChain GRI 410 Security Practices410-1Security personnel trained in human rights policies or procedures/
GRI 411 Rights of Indigenous Peoples411-1Incidents of violations involving rights of indigenous peoplesCommunity Development
GRI 413 Local Communities413-1
Operations with local community engagement, impactassessments, and development programs
Community Development413-2
Operations with signi?cant actual and potential negative impactson local communities
Community Development
GRI 414 Supplier Social Assessment
414-1New suppliers that were screened using social criteriaSustainable Supply Chain414-2Negative social impacts in the supply chain and actions takenSustainable Supply Chain
GRI 415 Public Policy415-1Political contributionsCommunity Development
GRI 416 Customer Health and Safety
416-1
Assessment of the health and safety impacts of product and servicecategories
Product Quality416-2
Incidents of non-compliance concerning the health and safetyimpacts of products and services
Product QualityGRI 417 Marketing and Labeling417-1Requirements for product and service information and labelingESG Key Performance417-2
Incidents of non-compliance concerning product and serviceinformation and labeling
ESG Key Performance417-3
Incidents of non-compliance concerning marketingcommunications
ESG Key Performance
GRI 418 Customer Privacy
418-1
Substantiated complaints concerning breaches of customer privacyand losses of customer data
Product Quality, ESG Key Performance
Muyuan Foods Co., Ltd.O?ce Address: Longsheng Industrial Park, Wolong District, Nanyang City, Henan ProvinceZip code: 473000Telephone: 0377-65233888Website: www.muyuanfoods.comE-mail: o?ce@muyuanfoods.com
The paper used for the printedreport is environmentally friendly.
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