Environmental, Social and Governance
2023 Report
Shenzhen INOVANCE Technology Co., Ltd.
INOVANCE Headquarter, No.3, Guansheng 4th Road, Longhua District, Shenzhen, Guangdong Province, P.R.China
ADVANCING INDUSTRIAL TECHNOLOGY FOR A BETTER WORLDWWW.INOVANCE.COM
WeChat AccountFeedback Collection
Chief EditorAli HanEditorial TeamJianfeng Hong, Bingzhen Shen, Chunmiao ZhengColleagues listed below also contributed to the ReportQinglin Cai, Liheng Cao, Yuhui Cao, Chen Chen, Jianbin Chen, Lixian Chen, Qing Chen,Rong Chen, Shaoyin Chen, Liumin Chu, Qingmei Cui, Longshan Ding, Xiaoting Ding,Yingying Ding, Adabala Sri Divya, Kunneng Dong, Pengpeng Dong,Shuhan Dong, Guanglong Duan, Cuntao Feng, Chang Gao, Junyang Gao, Zhijun Gu,Zhipei Gu, Anna Guo, Jia Guo, Yan Guo, Li Hang, Guohua He, Liz Hui, Min Hua, Shaomin Huang,Yongchang Huang, Ming Jia, Lingyu Jiang, Renjie Jiang, Zhiqiang Jiang, Song Jin,Stephanie Karle, Yongchao Lan, Fangbiao Lang, Dejun Li, Enze Li, Fujun Li, Hui Li, Lanlan Li,Man Li, Ruilin Li, Shiqi Li, Wendong Li, Wenhong Li, Wenrui Liang, Dachun Lin, Feng Liu,Huan Liu, Longguo Liu, Na Liu, Weitong Liu, Yajing Liu, Yu Liu, Pan Long, Wei’an Lu, Yan Lu,Zhenwei Lu, Hao Luo, Lingxiao Luo, Shuman Luo, Yonghui Luo, Yue Lv, Ilaria Maiocchi,Chengpeng Ni, Yanxia Ouyang, Lei Pan, Shanli Pan, Anjin Peng, Yangju Peng, Dongbo Piao,Vinciane Pujols, Keyi Qi, Xiaohui Qu, Connie Ren, ?eyda Sayar, Yishi Shi, Wanfeng Su,Weilan Sun, Caixing Tan, Xiangqi Tang, Bing Wang, Chenhu Wang, Hongtao Wang,Jun Wang, Lili Wang, Liang Wang, Ping Wang, Shannan Wang, Xiwen Wang, Xiaoling Wang,Xingran Wang, Xuan Wang, Yanbin Wang, Zhuang Wang, Huafang Wu, Ping Wu, Shuting Wu,Weihong Wu, Wenbin Wu, Xiaoyan Wu, Yingying Wu, Liqiang Xiao, Wenyan Xie, Yan Xie,Chenchen Xu, Hongru Xu, Peng Xu, Shunyi Xu, Chenchen Xu, Huiying Yan, Bo Yan, Ke Yan,Yi Yan, Aiguo Yang, Zhen Ye, Xiao Yu, Xiaoqiong Yu, Baogang Yuan, Zhongjun Yuan,Hua Zeng, Yan Zeng, Guangwei Zhai, Chunlin Zhang, Hongdeng Zhang, Hua Zhang,Huanhuan Zhang, Jianming Zhang, Karrie Zhang, Ningning Zhang, Ping Zhang,Ren Zhang, Sheng Zhang, Weijiang Zhang, Yang Zhang, Zhenhai Zhang, Min Zhao,Ou Zhao, Hao Zheng, Ming Zheng, Long Zhi, Weiqin Zhong, Junqing Zhou, Qin Zhou,Xijiang Zhou, Jinfeng Zhu, Liang Zhuang, Linhong Zhuang, Tong Zou
CONTENT
About This ReportMessage from Chairman
Report AppendixAppendix 1: ESG Key Performance TableAppendix 2: Index TableAppendix 3: GlossaryAppendix 4: Material Topics of High Impact In 2023Appendix 5: Reader's Feedback Survey
Introduction toINOVANCE
1.1 Company Pro?le
1.2 Business Layout
1.3 Core Business
1.4 Key Performance in 2023
Annual Feature:
Two Decades of Leapand Progress
SustainableCorporate Governance
3.1 ESG Management
3.2 Corporate Governance
3.3 Robust Operation
Focus onCustomer Satisfaction
5.1 Strict Product Quality Control
5.2 Improving Customer Services
EmployeeDevelopment Guarantee
7.1 Employee Rights and Welfare Protection
7.2 Talent Attraction and Retention
7.3 Employee Training and Development
7.4 Occupational Health and Safety
6.1 R&D Innovation Focus
6.2 Data Privacy Protection
InnovationDrives Development
8.1 Building A Sustainable Supply Chain
8.2 Promoting Industrial Cooperation
and Development
8.3 Contributing to Social Development
Inclusive And ResponsibleEcosystem Building
EmpoweringDecarbonization
4.1 Addressing Climate Change
4.2 Innovative Green Products
Feature TopicScope 4 Avoided Emissions
4.3 Strengthening Energy Management
4.4 Focusing on Environmental Compliance
4.5 Enhancing Resource Utilization Eciency
This report is the 4th Environmental, Social and Governance (ESG) report of Shenzhen INOVANCE TechnologyCo., Ltd. (hereinafter referred to as "INOVANCE," "the Company" or "we"). The report systematically presentsINOVANCE's sustainable development philosophy, management mechanisms and speci?c actions, andprovides information on the Company's ESG performance, target progress and achievements in 2023. Thereport aims to respond to the concerns of stakeholders and strengthen communication and interaction withthem to continuously promote sustainable development.
About This ReportAbout This Report
Scope of ReportThe information disclosed in this report covers Shenzhen INOVANCE Technology Co., Ltd. and its subsidiaries.Unless otherwise speci?ed, it is consistent with the scope of the consolidated ?nancial statements in theannual report of INOVANCE (Stock Code: 300124.SZ).
Time PeriodThe report releases annually with information and data spanning the period from January 1, 2023 to December31, 2023. For Any information and data go beyond this time frame, explanations will be placed in where it isinvolved.
Reporting Standards
The report is complied in accordance with the guidelines of the stock exchange where the company is listedand international sustainable development information disclosure standards, with reference to the followingdisclosure documents:
Data DescriptionThe text information and data used in this report are derived from the Company's actual operating raw data,internal documents, ?nancial reports, self-media external disclosure information and public information ofauthoritative third party. In case of any inconsistency between the relevant ?nancial data and the Company'sannual ?nancial report, the data in the ?nancial report shall prevail. The report uses RMB as the currency unitof measurement.Reliability AssuranceThe report adheres to the principles of accuracy, balance, comparability, materiality, veri?ability and under-standability. The report discloses information objectively, truthfully and completely, and does not contain anyfalse records, misleading statements or major omissions. The report has been reviewed and approved by theBoard of Directors, and the Board of Directors is responsible for the authenticity, accuracy and completenessof the content.Access to ReportThe report is published in Simpli?ed Chinese and English versions. In case of any discrepancy between theEnglish and the Simpli?ed Chinese version, the content of the Simpli?ed Chinese version shall prevail. Thedigital version of the report can be viewed and downloaded on INOVANCE's ocial website www.ino-vance.com
Contact UsINOVANCE Sustainability OceE-mail: sustainability@inovance.comWebsitehttp://www.inovance.comAddress: INOVANCE Headquarter, No.3, Guansheng 4th Road, Longhua District, Shenzhen, GuangdongProvince, P.R.China
Shenzhen Stock Exchange (SZSE) Guidelines of Shenzhen Stock Exchange for Self-discipline Regula-tion of Listed Companies No.2 – Standard Operation of Listed Companies on ChiNext Board (Revisedin December of 2023)Annex I Corporate Social Responsibility Report Disclosure Requirements for Listed Companies,Chapter 1 Section 2 Matters Related to the Disclosure of Periodic Reports, Guidelines of ShenzhenStock Exchange for Self-discipline Regulation of Listed Companies No.1 - Business Processing(Revised in December of 2023)Global Reporting Initiative (GRI) Sustainability Reporting StandardsInternational Sustainability Standards Board (ISSB) IFRS S1 General Requirements for Disclosure ofSustainability-related Financial InformationUnited Nations Sustainable Development Goals (UN SDGs
Terminology of Company and SubsidiariesTo facilitate stakeholder review, we have complied the correlation between the abbreviated designations andthe full names of the Company's key operational sites* as follows.
*Key Operational Site refers to the Company's headquarter and its subsidiaries that have substantive impact on the
Company's business operations.
Shenzhen INOVANCE Technology Co., Ltd.Suzhou INOVANCE Technology Co., Ltd.Suzhou INOVANCE Automotive Co., Ltd.INOVANCE New Energy Vehicle Technology (Changzhou) Co., Ltd.Jiangsu Kingway Transportation Co., Ltd.SHANGHAI BST ELECTRONIC CO., LTD.BST Electrical (Jiaxing) Co., Ltd.BST Machinery & Electronics (Jiaxing) Co., Ltd.SHANGHAI BNK CABLE CO., LTD.Ningbo EST Technology Co., Ltd.Dalian Zhiding Technology Co., Ltd.Guangdong MJB Electric Co., Ltd.Tianjin BST Electric Co., Ltd.Yueyang INOVANCE Technology Co., Ltd.Suzhou INOVANCE Control Technology Co., Ltd.Nanjing INOVANCE Technology Co., Ltd.
INOVANCESuzhou INOVANCEINOVANCE AutomotiveChangzhou INOVANCE New EnergyJiangsu KingwayBSTBST Electrical (Jiaxing)BST Machinery & Electronics (Jiaxing)BNK CABLEESTDalian ZhidingMJB ElectricTianjin BST ElectricYueyang INOVANCESuzhou INOVANCE ControlNanjing INOVANCE
Company / Subsidiaries NameShort NameKey Operational Site
The year 2023 witnessed heightened geopolitical tensions and global instability, signi?cantlyimpacting the established international economic order. This evolving landscape, coupled withrising global energy prices, disrupted energy supply chains, and threatened energy security. Simul-taneously, GHG emissions caused by human activities have exacerbated the global climate crisis,posing a signi?cant challenge to the Paris Agreement's 2°C target due to disparities in nationalemission reduction efforts.Sustainable development remains a shared aspiration of humanity and a consensus for globalprogress. As a responsible corporate citizen, INOVANCE guided by its mission to "advancing indus-trial technology for a better world," remains steadfast in its commitment to sustainable develop-ment. We leverage technology to drive green intelligent manufacturing and make contribute tosocietal well-being.In alignment with China's "Dual Carbon" strategy, INOVANCE put forward the ambitious "2850"and "3030" goals in 2022. We pledged to achieve carbon peaking and carbon neutrality in ouroperations by 2028 and 2050 respectively, and to reduce the GHG intensity of our major suppliersby 30% by 2030 compared to 2021. Throughout 2023, we implemented several energy-saving andemission-reduction initiatives, encompassing equipment intelligence upgrades, digital and re?neenergy management, and optimization of high-energy-consumption processes. Our newlyconstructed Yueyang factory adheres to green, low-carbon, and digital factory standards, incorpo-rating clean energy sources to optimize our energy consumption structure. Guided by the princi-ple of "energy conservation, material conservation, and eciency enhancement," we adhere torelevant laws and regulations in managing hazardous waste disposal. We embrace the concept ofa circular economy, practicing resource reduction, substitution, and recycling throughout ourproduction and operational processes, thereby further enhancing resource utilization eciency.
Message from ChairmanMessage from Chairman
The global energy and climate crisis presents both challenges and opportunities for INOVANCE. Asa leader in China's industrial automation sector, we aspire to facilitate energy conservation andemission reduction among our upstream and downstream partners through our products andsolutions. We aim to become a cornerstone of the dual carbon initiative and a robust enabler ofdigital energy management. Our AC drives and high-ecient PM motors generate signi?cant valuein green energy conservation within the transforming coal, steel, non-ferrous metals, and otherindustries, supporting the transition of high-energy-consumption sectors. Our off-shore powersystems have empowered 70 port terminals to achieve regular shore power connections for ships,enabling lean management of port energy consumption. Our electric vehicle controller and motorserve as core components of new energy vehicles, contributing to green and low-carbon transpor-tation. We remain dedicated to continuous improvement in energy eciency and unwavering inour pursuit of energy saving and carbon reduction.Furthermore, INOVANCE places great emphasis on and actively addresses the concerns of ourdiverse stakeholders. We prioritize customer satisfaction, rigorously control product quality, andensure that every product meets customer standards. We enhance customer service and havelaunched the "My INOVANCE" App to provide comprehensive online marketing and after-salesservices. We drive development through innovation, introduce new products, and implementsuperior, optimized, and forward-looking technical solutions. We prioritize privacy and securityprotection, ensuring information and IT security. We value employee rights and well-being, foster-ing a positive work environment and offering a competitive development platform. We collaboratewith our ecosystem partners to build a green, safe, and reliable supply chain, working togetherwith various stakeholders to achieve sustainable development goals.The year 2023 marks the 20th anniversary of the establishment of INOVANCE. Looking ahead atthe new age, INOVANCE remains committed to the principles of sustainable development, activelyaccelerating the development and implementation of intelligent, green and digital products andsolutions while continuously enhancing our ESG management practices. Our aim is to establish abenchmark for sustainable development among domestic industrial control sector. Moreover, weremain steadfast in philosophy and principles of openness, collaboration and value sharing. Wewill strengthen cooperation throughout the industry chain, empowering stakeholders to achieveenergy conservation and emission reduction targets. Through these collaborative efforts, we areexpecting to drive the green, low-carbon, and high-quality development of the industry andcontribute to a more sustainable future.
Chairman and PresidentXingming ZHU
CHAPTER 1
1.1 Company Pro?le
1.2 Business Layout
1.3 Core Business
1.4 Key Performance in 2023
INTRODUCTION TO
INOVANCE
INOVANCE has over 70 branches inSuzhou, Hangzhou, Nanjing, Shanghai,Ningbo, Changchun, Hong Kong, and 6R&D centers in Shenzhen, Suzhou, Xi'an,Nanjing, Milan in Italy and Stuttgart inGermany.
1.2 Business Layout
Introduction to INOVANCEIntroduction to INOVANCE
INOVANCE is a high-tech Company engaged in the R&D, manufac-turing and sales of industrial automation and new energy products.The Company focuses on developing core technologies for informa-tion layer, control layer, drive layer, execution layer, and sensor layerand automation, digitalization and Intelligence in the industrialsector. It is committed to promoting intelligent manufacturing,industrial upgrading, improving the quality of life and fostering thedevelopment of industrial civilization by providing more intelligent,precise and advanced integrated products and solutions.
1.1 Company Pro?le
Customer ?rst, contribution oriented,uphold to openness and cooperation,strive for excellence
Core Values
Advancing industrial technologyfor a better worldVision & Mission
Year of IncorporationListed Stock ExchangeStock CodeServing MarketsHeadquarter Location
2003Shenzhen Stock Exchange300124.SZ36 countries and regions includingChina, India, Vietnam, South Korea,Germany, Italy and TurkeyShenzhen, Guangdong Province,P.R. China
Changchun
Changchun Weton OptoelectronicTechnology Co., Ltd.
Jinan (Under Construction)
Jinan INOVANCE Technology Co., Ltd.
BeijingEKSYS (Beijing) Technology Co., Ltd.
Ningbo
Ningbo EST Technology Co., Ltd.
Xi’anXi’an INOVANCE Technology Co., Ltd.
NanjingNanjing INOVANCE Technology Co., Ltd.
Suzhou
Suzhou INOVANCE Technology Co., Ltd.Suzhou INOVANCE Automotive Co., Ltd.Jiangsu Kingway Transportation Co., Ltd.Suzhou INOVANCE Control TechnologyCo., Ltd.
Shanghai
SHANGHAI BST ELECTRONIC CO., LTD.SHANGHAI BNK CABLE CO., LTD.Shanghai LAIEN Precision Machine ToolAccessories Co., Ltd.
Tianjin
Tianjin BST Electrical Co., Ltd.
Dalian
Dalian Zhiding Technology Co., Ltd.
Hongkong
Inova Automation Co., Ltd.FoshanGuangdong MJB Electric Co., Ltd.
Yueyang
Yueyang INOVANCE Technology Co., Ltd.
IndiaINOVANCE TECHNOLOGY PRIVATE LIMITED
ItalyINOVA AUTOMATION ITALY S.R.L.
France
INOVANCE Technology France
Shenzhen
Shenzhen INOVANCE Technology Co., Ltd.
Changzhou
INOVANCE New Energy VehicleTechnology (Changzhou) Co., Ltd.
Jiaxing
BST Electrical (Jiaxing) Co., Ltd.BST Machinery & Electronics(Jiaxing) Co., Ltd.
Hungary (Under Construction)INOVANCE Technology HungaryKorlátolt Felel?sség? Társaság
GermanyINOVANCE Technology
Europe GmbH
INOVANCE Automotive HungaryKorlátolt Felel?sség? Társaság
TurkeyINOVANCE TECHNOLOGYEND?STR?YEL OTOMASYONL?M?TED ??RKET?
Note: The picture only shows part of major companies, branches and subsidiaries of INOVANCE.
Manufacturing Facility/BaseR&D Center
MetricsCategoryUnit2023million RMBmillion RMBRMB per sharemillion RMB%tCO2e per million yuan
tCO2eMWhkWhtonsmillion RMBmillion RMB%/hours%person-timepersons/person-timehourstimes
EconomicPerformance
EnvironmentalPerformance
SocialPerformance
GovernancePerformance
30,419.934,741.86
1.78
48,957.56
21.66
4,5001,791
2,624
8.63
686,347.40
38,407
4.05
10,748,5278,740.501,964,500
837.14
6.02
RevenueNet pro?t attributable to shareholders of
the listed company
Basic EPSTotal assetsWeighted Average ROE
GHG intensityAvoided GHG emissionsTotal renewable energy consumption
Estimated amount of energy saving
Amount of recycled wasteTotal operational expense in environmen-
tal protectionR&D investmentProportion of R&D investmentNumber of new patent applicationsAmount of employee training hours
Coverage rate of social insuranceNumber of participants in safety training
sessionsNumber of independent directors on the
Board of DirectorsNumber of documents reviewed by the
General Meetings of Shareholders, the
Board of Directors and the Board of
SupervisorsNumber of investor investigation recetionAmount of anti-corruption training hoursNumber of major incidents violated laws
and regulations
Provide low-cost, high-quality integrated product solutions and services forelectric passenger and commercial vehicles (including electric buses andlogistics vehicles). Our main products include electric drive systems (motor,motor controller, e-powertrain) and power supply systems (DC/DC, OBC, PDU)etc.
NEV Electric Drive System & Charging System
Upgraded from BBB to A
Selected into S&P Global ?rstSustainability Yearbook2022 (China Edition)
Medium RiskManagement Level
MSCI ESG Rating
S&P GlobalCorporate SustainabilityAssessment Scoring
Morningstar Sustainalytics
ESG Risk Rating
CDP Rating
Provide integrated electrical solutions for elevator manufacturers and theelevator after-sales service market. Our main products include elevator controlsystem(integrated controller/AC drives), human-machine interface, accesscontrol system, control cabinet, cables and harnesses, electrical shaft system,elevator IOT, etc.
Elevator & Escalator Solutions
Provide professional industrial automation products and solutions for clients,including AC drives, servo systems, control systems (PLC, CNC), SCARA Robots,industrial vision systems, sensors, high-performance motors, high-precisionball screws, industrial Internet and other core modules, as well as solutions foropto-electro-mechanical-hydraulic-pneumatic integration.
Automation
Provide traction systems and services for metro and light rail. Our main pro-ducts include traction converters, auxiliary converters, high voltage boxes,traction motors and TCMS etc.Electric Traction System
1.3 Core Business
1.4 Key Performance in 2023
Annual Feature: Two Decades of Leapand Progress
Annual Feature:
Two Decades of Leap and ProgressAnnual Feature:
Two Decades of Leap and Progress
| A Leader in Intelligent Manufacturing:
Rising Above the Competition
The Company implements its business transformation from industrial automation to digital energymanagement, reorients its positioning from hardware-oriented company to software-oriented companyand expands its business operation from domestic market to the global market.
The achievements of INOVANCE cannot be made without differentiated value creation for customers. Theunique value of INOVANCE lies in its rapid demand ful?llment, next-generation product iteration, andcross-border innovation. INOVANCE can seize the opportunity in time and ?ll the demand gap with rapidactions when the gap between customer demand and product supply is identi?ed. As for product iteration,INOVANCE requires each iteration shall encompass cross-generation technology progress, re?ecting itsconnection value, performance value and cost value. In terms of technology innovation, INOVANCE gains com-petitiveness from innovation one step ahead by quick identi?cation and grasp of technology evolution. Interms of cross-border innovation, INOVANCE leverages its service experience and know-how in different indus-tries to duplicate its technology success across industries. Depending on the Company's unique advantagespresented above, INOVANCE stands out from the competition and becomes one of the industry leaders.
In 2019, INOVANCE fell into the "middle income trap" of company development. Thus, the Company started adicult and ?rm organizational reform to reshape organization and achieve self-iteration. Guided by theprinciple of “structure building is the priority, scenario recognition is the guide,” the reform focused on enhanc-ing customer satisfaction and improve operation eciency and took place in Corporate Governance (CG), Man-aging Strategy (MS), Sales and Services (LTC/MCR/ITR), Integrated Supply Chain (ISC), Integrated Product Devel-opment (IPD), Integrated Human Resources (IHR), Total Quality Management (TQM) and Integrated FinancialService (IFS) totaling 19 operation processes, enabling processes and supporting processes. Adhere to theconcept of “two focuses and two returns,” the Company not only emphasizes both the long-time constructionof principal “fairway” and quick wins in a short time (“two focuses”) but also leverages the short-term bene?tsand talent cultivation in the reform (“two returns”).This reform centered on the optimization of business operation and reshape business process including corpo-rate governance, strategic management, customer service, supply chain management, R&D innovation, andhuman resource management. It has re?ned the internal management and regulatory system of the Companyand bolstered the systematic thinking and management skills of the executives, leading to effective value loopcreation through process reform. This has signi?cantly contributed to the company's revenue milestone of 10billion RMB in 2020.
| A Steadfast Organizational Reform Explorer:
Boldness and Braveness Led to Success
Over the past two decades, through dedicated effort and unwavering progress,INOVANCE has grown as a leading industrial automation products and NEVcore components provider, boasting a market value exceeding 100 billion RMBand extending its services to 36 countries and regions. Embracing the opportu-nities presented by the times and undeterred by challenges, INOVANCE hasconsistently adhered to a core principle of technological innovation, driven bythe pursuit of value creation for customers. We have propelled the transforma-tion of our products and solutions towards intelligence, greenness and digitali-zation, collaborating with diverse industries to advance industrial civilizationand supporting the realization of a better life for countless households.
Data is collected at the end of 2023.
Vector ControlAC Drive
To be the exceptionalAC drive provider in China
To be the exceptionalAC drive provider in China
Expand to industrial automationtotal solution provider
Expand to industrial automationtotal solution provider
Expand to industrial automationtotal solution provider
One Axis:
Engaging at Vector Control
One Axis:
Engaging at Vector Control
One Network:
Strengthening Controller Products
One Network:
Strengthening Controller Products
One Ecosystem:
Digital Energy ManagementEnabler for Power Generation,Grid, Load, and Storage
One Ecosystem:
Digital Energy ManagementEnabler for Power Generation,Grid, Load, and Storage
IntegratedElevator Controller
PLCServo SystemsElectric VehiclesIndustrial Robots
Digitalization+EnergyManagement+Glocalization
Expand business tothe new energy
related areaExpand business tothe new energy
related area
Expand business to
the new energy
related area
Expand business to offeropto-electro-mechanical-hydraulic-pneumaticintegrated solutionsExpand business to offeropto-electro-mechanical-hydraulic-pneumaticintegrated solutions
Digitalization+EnergyManagement+GlocalizationDigitalization+EnergyManagement+Glocalization
Through continuous efforts in the past 20 years, INOVANCE has developed from a AC drives manufacturer atthe startup period to an integrated product and solution provider with AC drives, servo systems, PLC, motors,industrial robots and NEV core components etc., making contribution to advancing industrial technology for abetter world.
GlobalMarket Share
DomesticMarket Share
First Tier atDomestic Market
Elevator Human-Machine Interface
Servo System
High Voltage
AC Drives
Small-size PLC
Elevator Integrated
Control System
Electric Commercial
Vehicle Controller
SCARA Robots
Electric PassengerVehicle Controller
Low Voltage
AC Drives
| Sustainability Practitioner:
Low-Carbon Transition and Sustainable Development
Since the establishment, the Company assumes corporate social responsibility actively and dedicates topromote comprehensive sustainable development. We focus on the topics of Corporate Governance, LeanInnovation, Low Carbon Pioneer, Responsible Ecosystem, Talent Development and Green Operations andcontiguously improve the sustainability management.After the launch of national “Dual Carbon” goal, the Company put forward “2850” and “3030” goals and madedigital energy management as one of core business strategies, aiming to become a cornerstone of the dualcarbon initiative. We take action in energy conservation, material conservation and eciency enhancement tostrengthen green and low-carbon operation. We also empower the green and low-carbon transition ofupstream and downstream partners by green, high ecient and energy-saving product to co-build thesustainable industrial ecosystem.“Advancing industrial technology for a better world” is our mission and vision. Standing at the age of 20,INOVANCE will stay true to the original aspiration, develop new quality productive forces and pursuehigh-quality sustainable development. Moving forward, led by technology innovation and energy eciency, wewill leverage digitalization capability to empower customer and further lay a solid foundations of industrychain integration for the purpose of developing more high-end products, providing more intelligent manufac-turing solutions, making energy consumption more ecient and building a healthier ecosystem. We are com-mitted to advancing the development of industrial automation sector and making green contribution tosustainable development.
Corporate digitalization is the only way towards future corporate transformation and upgrading. We ociallyannounced Digital INOVANCE Strategy in 2020, namely, to realize high-ecient operation and explorebusiness model innovation by implementing digitalization. For internal management, led by corporate struc-ture reshaping and the target of “enhancing customer satisfaction and improving operation eciency,” werestructured our business, organization, work process, data and IT to ignite digitization and strive for compre-hensive ?ne management. For external service, we explore dynamic business models empowered by digitalproducts and innovative services.Our internal digitalization transformation and upgrading centers around data governance. The Companyimplemented Business Architecture (BA), Information Architecture (IA), Application Architecture (AA) andTechnology Architecture (TA) to conduct clear, systematic, layered and classi?ed analysis in reference to 4Astructuring methodology of digitalization transformation. Internal data governance revolves around the digita-lization of core business to achieve ecient business operation with the help of transparent, clean, accurateand connected data. External data governance, on the other hand, highlights customer experience throughaccurate, prompt, safe information sharing to enhance customer satisfaction. By means of internal and externaldata governance, INOVANCE has basically established an initial data management system for business opera-tion and development. The system helps to break the data silos and realize accurate, reliable and safe datainteraction.In 2023, the company focused on building data architecture and enhancing data quality management. Interms of the construction of the data architecture, the company carried out actions with 59 business entitiesacross 5 key domains—marketing, R&D, supply chain, ?nancial management, and human resource manage-ment (hereinafter referred to as the "3+2 domains"), released standards for 2 business entities, and updated 507data assets in the 3+2 domains. By the end of 2023, a total of 84 standards had been published, with an overallpublication rate of 17%. 59 IT standards were implemented with an overall implementation rate of 12%.Regarding data quality management, the company established methodology to assess data quality, formulatedtemplates for quality scoring, issued data quality reports, quanti?ed data quality, and pinpointed quality issues.During the reporting period, we have issued 1 data quality report.Moreover, the company has a deep grasp of the diverse, specialized, and changeable characteristic of industrialmanufacturing. Based on the need for affordability, eciency, swift deployment, and ease of upgrade, we hasestablished the InoCube platform, a new generation model-driven system for digitalization and data gover-nance. This platform supports both the Company's digital transformation and that of our customers. At present,INOVANCE specializes in equipment, manufacturing, and operational intelligence. We have developed an IoTsolution for hardware and software, after-sales service solution, manufacture management for textile andcotton spinning industry, digital air compression station solutions at factories and integrated energy manage-ment solution echoed national “Dual Carbon” goals. This actions not only lays foundation for intelligent factoryand zero-carbon factory building but also presents the Company’s determination and dedication to Industry 4.0.
| Digitalization Enabler: New Chapter Driven by Digitalization
Co-develop with ecosystem partners to realize technology breakthrough.“Empowering more advanced machinery”
Achieve manufacture automation, intelligence by digitalization platform to enhance
coordination eciency among business units.“Enabling smarter manufacturing”
Continuously improve product energy eciency, enter digital energy management
market and build digital zero-carbon factories.“Making energy consumption more ecient”
Build a friendly ecosystem connecting industry talents, users, partners and peers.
“Building a more sustainable ecosystem”
CHAPTER 3
SUSTAINABLE
CORPORATE GOVERNANCE
3.1 ESG Management
3.2 Corporate Governance
3.3 Robust Operation
INOVANCE has consistently adhered to the concept of sustainable develop-ment, integrating ESG management comprehensively into its business opera-tions and management. By establishing a robust ESG governance structure,formulating ESG strategies, strengthening stakeholder communication andoptimizing ESG material topics management, INOVANCE has improved its ESGgovernance capability and promoted the comprehensive, balanced andin-depth uni?cation of the concept of sustainable development with the com-pany's strategy and the needs of various stakeholders. In 2023, the company'spractices and achievements in ESG governance and management havereceived wide acclaim from other parties.
Sustainable Corporate GovernanceSustainable Corporate Governance
INOVANCE attaches great importance to the construction of the sustainable development governance systemand has established a top-down ESG governance structure. The Board of Directors is the highest decision-making authority, which has set up the Sustainability Committee and the Sustainability Oce, to coordinatethe Company's ESG strategy and ensure the ecient implementation of ESG management measures for oursustainable development.The Company's Board of Directors oversees and manages ESG issues in a comprehensive manner, guiding thedirection and major trends of sustainable development, and performs the decision-making authority on relatedstrategies, objectives and speci?c matters. The Company established the Sustainability Committee, with thePresident as the head of the Committee and key personnel of ESG-related business units and departments(including vice presidents and directors) as members. The Committee is responsible for overseeing the prog-ress of ESG management by our ?rst-level management and our subsidiaries and tracking their progress. TheSustainability Oce under the Committee is responsible for promoting the implementation of managementmeasures on key ESG issues such as Climate change mitigation and adaptation.The Sustainability Committee holds regular meetings to report the progress and performance of the Compa-ny's ESG management to the Executive Management Team (EMT), including members of the Board of Direc-tors, and to listen to their opinions and suggestions. The Company also incorporates ESG performance indica-tors into the management's remuneration system and applies appropriate rewards and clawbacks based onthe annual appraisal results, to strengthen the ESG governance capabilities and further enhance the proactive-ness and sustainability of ESG governance and management.
3.1 ESG Management
3.1.1 ESG Framework
Responsibilities of the Sustainability Committee
Develop the company-levelsustainability strategy, goalsand guidelines, promotethe implementation of suchstrategies, and supervisethe implementation ofrelated tasks
Monitor the Company'ssustainability risks(including but not limitedto key issues such asbusiness ethics, addressingclimate change, safeguard-ing employee rights andinterests, and EHS), anddevelop appropriatemanagement measures
Coordinate the establish-ment, implementation andcontinuous improvement ofthe sustainability manage-ment system, and makedecisions on related issuesto ensure that the Compa-ny's sustainability manage-ment complies withrelevant laws and regula-tions, internationalstandards and key stake-holder requirements; drivecross-discipline/cross-pro-cess sustainability businessalignment and enableend-to-end operationalsynergies in sustainabilitybusiness
Promote corporate trans-parency on sustainabilityand review the Company'sannual ESG report; conducteffective communicationwith key stakeholders,including investors, customers,rating agencies andregulators, on sustainabili-ty-related matters
Board of Directors
EMTSustainability Committee
Sustainability Oce
Board Secretary's OceHR DepartmentPresident's OceStrategy & MKT DepartmentISC Management DepartmentFinancial Management DepartmentINOVANCE AcademyProduct Competence CenterCost Management DepartmentIP & Legal CenterProcess &IT DepartmentQuality Management DepartmentR&D Management DepartmentAudit DepartmentInvestment & Development DepartmentTechnical Service CenterBusiness DivisionsSubsidiaries
The Company pays close attention to the internal and external impacts of ESG and sustainability. Drawingfrom the company's strategy, industry dynamics, and the UN SDGs, it has devised ESG strategies focusing onsix dimensions: "Corporate Governance," "Lean Innovation," "Low Carbon Leadership," "Responsible Ecology,""Talent Development," and "Green Operations." These strategies are integrated into all aspects of the company'sproduction, operation, and business decision-making.
3.1.2 ESG Strategy
3.1.3 Management of Material Topics
The Six Dimensions of ESG StrategyCorresponding SDGsCorporateGovernance
LeanInnovation
Low Carbon
Pioneer
· Maintain a robust corporate governance system and improve it· Create an internal compliance culture
Goal 16:
Peace, Justice and Strong Institutions
Goal 9:
Industry, innovation and infrastructureGoal 12:
Responsible Consumption and ProductionGoal 16:
Peace, Justice and Strong Institutions
Goal 7:
Affordable and Clean EnergyGoal 9:
Industry, innovation and infrastructureGoal 13:
Climate Action
· Increase investment in R&D and innovation continuously· Improve product quality and enhance quality management eciency· Provide high quality services to customers
· Practice low-carbon operation with a focus on "energy saving, material conservation and eciency enhancement"· In light of the national carbon peaking and neutrality goals, providenew energy-related products and create lower-carbon products and solutions· Address climate risks and enhancing capabilities for climate change mitigation and adaptation
GreenOperations
· Improve environmental management system to ensure environmental compliance· Enhance resource eciency in manufacturing and operations to reduce life-cycle environmental footprint
ResponsibilityEcology
TalentDevelopment
Goal 3:
Good Health and Well-beingGoal 4:
Quality EducationGoal 9:
Industry, innovation and infrastructureGoal 12:
Responsible Consumption and ProductionGoal 17:
Partnership for the Goals
Goal 3:
Good Health and Well-beingGoal 4:
Quality EducationGoal 5:
Gender EqualityGoal 8:
Decent Work and Economic GrowthGoal 10:
Reduced inequality
Goal 7:
Affordable and Clean EnergyGoal 13:
Climate Action
· Build a secure, stable and resilient supply chain· Realize sustainable supply with a focus on survey and assessment of supply chain sustainability
· Protect employees' rights and bene?ts· Provide a sound and safe workplace· Foster all-round and sustainable development of employees
The Six Dimensions of ESG StrategyCorresponding SDGs
Communication with ShareholdersStakeholders' expectations and demands are the source and motivation for us to improve our sustainabilityperformance. We respect and safeguard the legitimate rights and interests of all stakeholders, striving to estab-lish long-term and stable communication mechanisms through various online and oine channels. In 2023,we actively engaged with stakeholders including customers, employees, shareholders, investors, suppliers andpartners, government and regulators, and community representatives, communicated in-depth informationon sustainable development management, and collected feedback and suggestions on our ESG management,so as to respond to their expectations and demands through focused management on issues of concern.
Honors and Awards for Sustainable Development Management
ESG Model Enterprise AwardESG Pioneer Listed Company Award2023 Sustainable Development Model Enterprise Award
2023 Easy-Board ESG+8 "Value 100"The 17th China Listed Companies ValueSelection - Outstanding Contribution Award for Green and
Low-carbon Initiatives in China Listed Companies
Guangdong Times Media GroupGuangdong Times Media Group,Times Weekly, Times FinanceShuyang NetworkShuyang Public Welfare
Securities Daily
Valueonline
Employees:
senior management
Vice presidents,directors, seniormanagement ofbranches andsubsidiaries
Customer Service Management (CSM)Product Safety and QualityManagementCorporate GovernanceR&D and InnovationEconomic PerformanceTalent Attraction and RetentionIntellectual Property Protection
Internal Management MeetingsManagement TrainingInternal EmailsDaily Communication
Employees: employeesother than seniormanagement
Employee / unionrepresentativesand other workerrepresentatives
Employee Rights and WelfareEmployee Training and DevelopmentOccupational Health and SafetyTalent Attraction and RetentionR&D and Innovation
Employee Bene?ts ProgramEmployee Training ProgramsPerformance Appraisal andEmployee PromotionEmployees' Congress and UnionINOVANCE CircleSafety Management in ProductionOccupational Health andSafety MeasuresIncentive Mechanism forR&D Innovation
Shareholdersand investors
Domestic andforeignshareholders,key investors
Economic PerformanceCorporate GovernanceCompliance ManagementGreen Products and InnovationClimate Change Mitigation andAdaptationSustainable Supply ChainManagement
General Meeting of ShareholdersEarnings PresentationsSpecial AnnouncementsInvestor Engagement Activities(daily communication, roadshows, communication through theplatform of SZSE, investmentstrategy sessions, onlinecommunication
Key Stakeholders
Representatives or Proxy
Organizations
Topics of Concern
EngagementMethods & Channels
Clients
OEMs and key endusers in automationand elevatorindustries, NEVmanufacturers
Customer service managementProduct Safety and QualityManagementData security and privacy protectionR&D and innovationGreen Products and InnovationClimate Change Mitigation andAdaptation
Customer Satisfaction ResearchAfter-Sales Service And ComplaintChannelsCustomer Data And PrivacyManagementCustomer CommunicationProduct Lifecycle ManagementTrade FairsProviding Green And Low CarbonProductsESG Disclosure
Key Stakeholders
Representatives or ProxyOrganizations
Topics of Concern
EngagementMethods & ChannelsGovernments atall levels in theplace of operation,SZSE
Risk ManagementCompliance ManagementClimate Change Mitigation andAdaptationOpportunities in Clean TechnologyEmissions and Waste ManagementEnergy ManagementWater Use
Information DisclosureInstitutional VisitsCorrespondencePolicy ImplementationActions Against Climate ChangeEnvironmental ManagementSystemGovernment andregulatory bodies
Suppliers of chips,modules, electroniccomponents andother materials,partner universities,industry associationsand chambers ofcommerce, standardsdevelopment workinggroups
Sustainable Supply Chain ManagementData Security and Privacy ProtectionR&D and InnovationCross-industry Collaboration andDevelopment
Supplier TrainingResponsible Minerals ResearchPublic Tender MeetingsStrategic CooperationNegotiationExchange VisitsIndustry-Education-ResearchCooperationSuppliersand partners
NGOs, charities,other socialorganizations, media
Charity Events and Volunteer ServiceCommunity Engagement andDevelopmentCompliance ManagementCorporate GovernanceR&D and InnovationOpportunities in Clean TechnologyEmissions and Waste Management
Public ServiceEmployee Volunteering ServiceESG DisclosureCommunity Engagement andPromotion ActivitiesEnvironmental ManagementSystemCommunityrepresentatives
Materiality Analysis
INOVANCE regularly conducts ESG materiality assessment and analysis, combined with domestic and interna-tional ESG-related policies and regulations, the latest policies of the stock exchange, excellent ESG manage-ment practices, and external experts' opinions. Based on the principle of dual materiality, we adjusted theidenti?cation and priority of the material topics in terms of "importance to stakeholders" and "importance tothe company's business operations," and formed a matrix of the INOVANCE ESG Material Topics.
Adjustments to Material Topics for 2023
PresentationAdjustment
Topic Removal
Current TopicsPrevious TopicsCompliance ManagementEmployee Rights and WelfareProduct Safety and Quality ManagementEnergy ManagementOpportunities in Clean Technology
Anti-CorruptionEmployee Rights and Bene?tsProduct and Service Quality ManagementEnergy UseClean TechnologyPrevious TopicsReason for RemovalEconomic PerformanceThe information regarding this topic is fully
disclosed in the Annual Report.
Materiality Analysis Process
Identify corporatebackground
Business background:
geographical location,business activities,business relationships, etc.ESG background:
current status of ESGmanagement of the Company,impact on stakeholdersExpert Analysis
Adjustment of topics:
Consolidation, deletionand adjustment ofpresentationMateriality adjustment:
reassess and reordermateriality to includenew topics of high impact
Policy & PeerBenchmarking
Policy benchmarking:
Identify ESG policies involvedin the businessPeer benchmarking:
Key topics concerned bypeers and companies in thevalue chain
Topic Con?rmationand ReportCon?rmation of the topics:
Material topics of high impactare reviewed and approvedby the Sustainability Committeeafter being tested and proposedby the Sustainability OceReport of the topics:
Highlight material topics ofhigh impact in the annual ESGreport
Materiality Matrix of INOVANCE in 2023
Charity Events andVolunteer Service
Water Use
Emissions andWaste ManagementCommunityEngagementand Development
Cross-Industry Collaborationand Development
Risk Management
R&D and Innovation
Opportunitiesin CleanTechnologyEmployeeTraining andDevelopment
IntellectualProperty ProtectionCompliance Management
Occupational Health
and SafetyData Security andPrivacy ProtectionCustomer Service
ManagementCorporate GovernanceEnergy Management
Talent Attraction
and RetentionClimate Change Mitigation
and Adaptation
Green Products
and InnovationProduct Safety
and QualityManagementEmployee Rights and Welfare
Sustainable SupplyChain Management
Material Topicof High Importance
Material Topicof Medium Importance
Material Topicof Low Importance
· Environmental Topics · Social Topics · Corporate Governance Topics
?Green Products and Innovation?Climate Change Mitigation andAdaptation?Energy Management?Product Safety and Quality Manage-ment?Talent Attraction and Retention?Customer Service Management?Data Security and Privacy Protection?Sustainable Supply Chain Manage-ment?Occupational Health and SafetyCorporate?Corporate Governance
?Opportunities in Clean Technology?Emissions and Waste Management
?R&D and Innovation?Employee Rights and Welfare?Employee Training and Development?Intellectual Property Protection?Risk Management?Compliance Management
?Water Use
?Cross-Industry Collaboration andDevelopment?Community Engagement andDevelopment?Charity Events and VolunteerService
Note: For further information on the de?nition and boundaries of material topics, please refer to "Appendix 4: Material Topics for 2023".
IMPORTANCE TOSTAKEHOLDERS
IMPORTANCE TO THE COMPANY'S BUSINESS OPERATIONS
3.2 Corporate Governance
Convening the General Meeting of Shareholders, the Board of Directors and theBoard of Supervisors in 2023
General Meetingof Shareholders
time
Meetings of theBoard of Directors
times
Meetings of theBoard of Supervisors
times
In 2023, such meetingsconsidered
motionsNote: More details on the Board of Directors and the corporate governance can be found in “Corporate Governance” of theINOVANCE 2023 Annual Report.
The Company strictly follows the Securities Law of the People’s Republic of China, the Rules Governing theListing of Shares on the Shenzhen Stock Exchange GEM, and the Guidelines for the Management of InvestorRelations of Listed Companies. We have formulated the INOVANCE Information Disclosure ManagementSystem, updated and revised the Investor Relations Management System as well as the Investor Visit andReception Management System during the reporting period, thereby establishing an ecient, transparentmechanism for the protection of investors’ rights and interests, particularly those of small and medium-sizeinvestors.The Company ful?lls its information-disclosure obligations in accordance with the law, implements the princi-ple of “truthfulness, accuracy, completeness, timeliness and fairness,” continues the effort to standardize andre?ne the information-disclosure process while enhancing the quality, broadening and ensuring the transparencyof information disclosure so as to protect the rights and interests of investors. The Company, during the reportingperiod, issued more than 160 announcements. Since IPO, the Company has obtained A ratings in the informa-tion-disclosure assessment of SZSE for 13 years consecutively as the only one among all listed companies onthe ChiNext market of SZSE.
INOVANCE faithfully observes the principle of “ecient operation, governance ?rst,” and complies with allregulatory requirements in order to improve its governance structure and governance mechanism for a robust,ecient corporate governance system.
The Company complies with the requirements of laws, regulations and regulatory documents such as theCompany Law of the People’s Republic of China, the Securities Law of the People’s Republic of China, theCode of Corporate Governance for Listed Companies and the Rules Governing the Listing of Shares on theShenzhen Stock Exchange GEM, doing so to establish a structure for corporate governance comprised of theGeneral Meeting of Shareholders, the Board of Directors, the Board of Supervisors and EMT. While we valuedemocracy and human rights, we insist on the centralization of authority and pursuit of harmony in diversityfor decision-making, thus forming a governance mechanism with clearly de?ned rights and liabilities, mutualcoordination and checks and balances while ensuring management that is ecient, scienti?c and transparent.The Company has developed systems and normative documents such as the INOVANCE's Articles of Associa-tion, Rules of Procedure of the General Meeting of Shareholders, Rules of Procedures of the Board of Directors,and Working System of Independent Directors in accordance with relevant laws and regulations. Thus, it has?rmly established the operative norms of the General Meeting of Shareholders, the Board of Directors and theBoard of Supervisors, clarifying the relevant responsibilities of relevant organizations to re?ne and strengthenthe governance structure.The General Meeting of Shareholders is the highest authority of the Company. The Company convenes andholds the General Meeting of Shareholders in accordance with INOVANCE's Articles of Association and theRules of Procedure of the General Meeting of Shareholders, thereby ensuring the shareholders’ right to knowand participate.As the Company’s decision-making organlzation for operation and management, the Board of Directors isresponsible for the General Meeting of Shareholders. In order to ensure the scienti?c and rational deci-sion-making of the Board of Directors, we consider the diverse backgrounds of the members of the Board,including gender, age, industry experience, professional acumen and other relevant factors. The Company’sBoard of Directors is comprised of 9 directors - 3 independent directors and 1 female–whereby the indepen-dent directors account for 33% and the female director accounts for 11%. The Board members engage invarious ?elds such as electrical engineering and automation, machinery, ?nance, accounting, etc., and have theindustry experience and knowledge necessary to perform their duties, thus helping the Board of Directorsmake appropriate decisions while ensuring the Company’s long-term sustainable development.The Board of Supervisors is the Company’s permanent supervisory body. It oversees the directors and seniormanagers in the conduct of their duties, doing so in accordance with the law. Moreover, it reviews the securi-ties issuance documents and periodic reports produced by the Board of Directors and issues written reviewcomments. The Board of Supervisors is comprised of 3 supervisors, one of whom is an employee representative.
3.2.1 Corporate Governance System
3.2.2 Protection of Investors’ Rights and Interests
Information disclosure
Three Basis: Information-disclosure promotion method process-based,
process-documentation template-based, and key-link billboard-based.
Five Examinations & Three Determinations: Carefully examine the
rules, guidelines, cases, history and essence in the process ofannouncement drafting; determine the logic, core and description.
Project-based Operation: Establish a mechanism for information
sharing and coupling with business departments in order to promotedisclosure management by means of project operation.
Innovative Disclosure
In order to meet the varied needs of investors, the Company has established comprehensive, ecient, diverseengagement channels to listen to investors’ voices and promote engagement, understanding and recognitionbetween the two sides. Through the Company’s ocial website, new media platform, SZSE’s interactiveplatform, investor hotline, investor email, web conferencing and other channels, the Company engages withinvestors by means of earnings presentations, road shows, analyst meetings, press conferences, ?eld researchand other means, doing so to help them fully and quickly understand the Company’s dynamics and information.During the reporting period, the Company answered 142 questions from investors through the SZSE’s interac-tive platform (irm.cninfo.com.cn/szse), representing a reply rate of 100%; received a total of 610 visits fromdomestic and international brokerage ?rms, investment funds and individual investors, involving more than4,500 investors, and it held 66 themed exchanges with multiple stakeholders on ESG-related issues.
Shareholder Engagement
The Company takes INOVANCE's Articles of Association, the INOVANCE 3-Year Shareholder Return Plan for2021-2023 and other institutional documents as the basis for the protection of shareholders’ rights andreturns. While maintaining timely, fair, and healthy communication with investors, the Company has beenrewarding them through a sound dividend distribution plan to ensure the long-term value of their investment.As of the end of the reporting period, the Company has paid cash dividends of RMB 5.636 billion cumulatively,far exceeding the total amount of RMB 1.941 billion raised from the Company's IPO.
Return to Investors
Major Measures for Shareholder EngagementInformation Collection: Strengthen communication with lead depart-
ments and related personnel; collect materials related to the Compa-ny’s operation and development, ?nance and other aspects, accumu-late materials for the preparation of the annual report and interimdisclosure and make predictions.Information Review: Ensure that the information disclosed is true,
accurate and complete; continuously improve the disclosure quality,and fully disclose all information that is bene?cial to investors’ valuejudgment and related decisions.
Statutory InformationDisclosure
Disclosure Method: Release corporate ESG reports annually and
respond to investors’ concerns on voluntary disclosure.Disclosure Management: Organize the relevant departments toparticipate in internal and external ESG training to enhance theunderstanding of ESG and improve disclosure quality.Voluntary InformationDisclosure
General Meetingof Shareholders
Investor Reception
OnlineCommunication
Hold investor exchange sessions to share the Company's strategic direc-tion, business layout, business status and outlookInvite executives with relevant business knowledge to participate in inves-tor exchange and answer investors' questions
Strengthen investors' knowledge of the Company's business and opera-tion through telephone, email and online meetingsSet up "Investor Relations" page on the Company's ocial website todisclose the Company's announcements and knowledge about theprotection of investors' rights and interestsDeliver important announcements, the latest trends and arrangementsfor investor engagement meetings through Inovance's Investor Relationsocial WeChat accountActively responding to investors' inquiries on the SZSE's interactiveplatformParticipate in road shows, media interviews and receptions occasionallyActively participate in on-site research, teleconferences, brokerage strate-gy meetings and other activities organized by investment management?rms
Hold at least 3 earnings presentations every yearInvestor Daily Communication and Reception
External Activities
Regulation of Connected TransactionsThe Company has formulated and updated the INOVANCE Decision-Making System for Connected Transac-tions with detailed provisions on the reporting of connected transactions, withdrawal system, decision-makingauthority and information disclosure to ensure the fairness of the Company’s decision-making regardingconnected transactions.
The Company has built a sound risk-management framework in line with its business reality and operationmode in accordance with the COSO-ERM framework. We have developed rules–notably the INOVANCE InternalRisk Control Management System–guidelines for risk management, in addition to which we’ve established arisk-management mechanism that encompasses the process of “risk identi?cation and evaluation - riskresponse and management - risk monitoring and reporting,” We have also incorporated elements of risk man-agement into strategic planning and business-plan development as the means to comprehensively enhanceour risk control and management capability.
Risk-management Framework
The Company had no major connected transactions during the reporting period. Meanwhile, the deci-sion-making procedures of minor connected transactions were in compliance with the relevant laws and regu-lations and our Articles of Association. The pricing of these connected transactions is fair and reasonable, with-out prejudice to the interests of the Company and its shareholders, particularly the interests of small and medi-um-sized shareholders.
The Company continuously strengthens and improves its risk management and internal control, and establish-es a stable risk-management framework and internal control system to provide favourable protection for theCompany’s sustainable development.
Honors and Awards for Corporate Governance
The Best Practice of Board ofDirectors’ Oce of Listed Companies in 2023
Tianma Award for InvestoRelations of Listed Companies in ChinaQuanjing Investor Relations Gold Award 2022
All-Asia Executive Team in 2023
China Association for Public Companies
Securities DailyQuanjing NetworkInstitutional Investor
INOVANCE adheres to the principle of “sincerity and trust,” regards internal risk control and operational com-pliance as the foundation of the Company’s robust development, continuously elevates our risk managementby building and improving the risk-management framework and internal control system, adheres to thephilosophy of integrity and compliance in all activities, and abide by business ethics.
3.3 Robust Operation
3.3.1 Risk Management and Internal Control
Regarding risk management responsibility, we have formulated the “Three Layers of Defence” risk controlmechanism, and the Board of Directors which ultimately responsible for risk management authorizes EMT toidentify and manage company-level risks. Additionally, it guides each area in the conduct of risk managementand control and clari?es the risk management responsibilities in each layer and department so as to preventsystematic risks.
Risk Management Measures of INOVANCE
Optimization of theRisk-control System
and Framework
The Risk Control COE
constructs and optimizes the top-level risk-control system andframework, guides the element owners to establish the components of effective riskcontrol, outputs the methodology and tools of risk and internal control, and guides theimplementation of risk-control projects in each business area.The Company regularly conducts risk identi?cation, evaluation and prioritization, collectsinternal and external risk information, identi?es risks and scenarios, evaluates risk levelsin terms of probability of occurrence and impact, and outputs a risk matrix. Moreover,the Company implements the concept of group prevention and control as it encourageswhistleblowing via the “president’s mailbox” and “whistleblower” channels so as toencourage employees to identify potential risks and dangers in production and opera-tions and to report them promptly.For the top risks identi?ed that need to be focused on control, the company designatesthe person responsible for risk management and control, formulates risk managementand control objectives, response programs / measures, and forms risk maps. Detailedresponse plans as needed and decompose speci?c tasks to ensure effective implementa-tion of risk management measures. For risks that can be controlled within processes,utilize relevant tools and methods of process internal control for management.Risk daily monitoring and reporting is conducted by the person responsible for riskmanagement and control to track and check the progress and effectiveness of riskmanagement and control measures as well as to adopt relevant means to monitor thelevel of risk and to provide early warning and corrective action. Additionally, the internalaudit formulates annual plans based on a risk-oriented approach to focus on high-riskareas, to review and evaluate the appropriateness and effectiveness of business activities,internal control and risk management and to promote the continuous improvement ofthe risk-management system.
Risk Identi?cation
and Evaluation
Risk Responseand Management
Risk Monitoring
and Reporting
1Center of Expertise.
The First Layer of DefenseBusiness Executivesand Process OwnersThe primary responsible entityfor risk management, proactivelyidentifying and managing risks,building internal control awarenessand capabilities in the process,and enhancing substantivecompliance with the process
Third Layer of DefenseInternal Audit
Exert independent supervisoryand evaluative functions,establish a cold deterrenceeffect, and report audit resultsto the Audit Committee andcompany's seniormanagement
Second Layer of Defense
Risk Management,Internal Controlsand Risk MonitoringIndustry SectorsSupport the ?rst-line corebusiness departments in risk control
Three Layers of Defense for Risk Management at INOVANCE
In terms of building a risk management culture, the company organized special training and examinations onrisk control and built a risk control knowledge platform library to provide comprehensive, one-stop access torisk control knowledge for the business end and enhance the risk management awareness of all staff. Duringthe reporting period, we organized more than 10 specialized risk control training sessions, covering over 500participants. We conducted several risk control examinations to assess the mastery of CT, the suite of tools, andbasic concepts of risk control in business areas, with a total of 216 individuals passing the examinations. Theprogram also provided 16 documents on risk control knowledge, covering risk control training and empower-ment materials, which can be accessed on demand by POs/PCs at all levels, business managers and BPs ofinternal control.
The Company has built an internal control system in compliance with the requirements of the Basic Stan-dards for Enterprise Internal Control and the relevant guidelines of SZSE and has established a series of inter-nal-control management systems, such as the INOVANCE Internal Control System, INOVANCE Internal ControlEvaluation System, INOVANCE Internal Control De?ciency Identi?cation Procedures, etc., built internalcontrol systems with focus on ?ve dimensions: business goal achievement, asset and capital security, opera-tional eciency, compliance and reporting, integrated methods and tools such as KCP, SOD and CT plan intobusiness processes, and conducted effect evaluation through internal control tools to continuously provideimportant information on the effectiveness of the relevant elements of internal control, and promote theincrease of the company’s internal control management.In 2023, the company completed the development of the internal control Proactive Review (PR) and Improve-ment Recommendation Tracking (RT) tools. The PR tool is generally used for self-inspection activities conduct-ed on speci?c businesses to verify the effectiveness of control activities, identify unknown risks and promotethe attainment of business goals. The RT tool is used for internal control issue location, root cause analysis, riskevaluation, issue introduction, improvement plan development, issue tracking and loop closure to ensure thatinternal control issues are closed timely and effective manner to prevent recurrence. The Company has effec-tively promoted CT testing in some areas to guide the establishment of self-correcting and self-improvinginternal control management systems in various business areas.In addition, during the reporting period, we promoted the establishment and improvement of accountabilitystandards for business violations to ensure compliance with the laws and regulations as well as to guide theful?llment of responsibilities and convey a clear value-oriented approach. We drove the top-level design ofrecords management and clari?ed the strategies, principles and lifecycle management requirements foruni?ed document management to ensure document security, integrity, consistency, and traceability, therebyfurther enhancing the control environment.We conduct at least one self-evaluation of the effectiveness of internal control each year for the company andsubsidiaries, in addition to which we issue and disclose evaluation reports covering the major aspects of thecompany’s environment control, risk assessment, activity control, information transfer and communication,and continuous monitoring. During the reporting period, the Company has not identi?ed any materialde?ciencies or signi?cant de?ciencies in internal control.With respect to audits, the Company has focused on ?nancial compliance audits, internal control audits, andspecial audits of major purchases and engineering construction management. Moreover, we promoted theclosed-loop recti?cation of audit ?ndings so as to drive improvement in the Company’s business processes andoperating mechanisms.During the reporting period, the Company placed emphasis on ?nancial compliance audits, internal controlaudits, and special audits of major purchases and engineering construction management and urgedclosed-loop recti?cation of audit ?ndings to promote continuous improvement of the Company's businessprocesses and operational mechanisms.
Internal Control System
The company strictly complies with all applicable laws and regulations, we have formulated the INOVANCEBusiness Conduct Guidelines (BCG), the INOVANCE Con?ict of Interest Management Measures, and theINOVANCE Employee Discipline Policy to systematically de?ne, guide and constrain the behavior of ourselvesand our employees.
Compliance Management System
3.3.2 Compliance Management
Strictly adhering to regulatory compliance, we have formulated a compliance management system and man-agement mechanism centered on trade compliance, data compliance, intellectual property protection,anti-corruption, anti-unfair competition, anti-money laundering and con?ict of interest, etc. Moreover, We haveintegrated compliance requirements into all aspects of production and operations, forming a comprehensivecompliance system for company behavior and management. Based on the foregoing, we have built a cleanbusiness environment with a focus on anti-corruption management and integrity in workplace.
Note: For details of data compliance and intellectual property protection, please refer to chapter 6.2 "Data Privacy Protection" and chapter
6.1.3 "Protect Intellectual Property".
For details of anti-corruption, please refer to “Anti-corruption and Integrity Building” in this chapter.
Tradecompliance
Anti-unfaircompetition/fair
competition
Anti-money
laundering
Con?ict ofinterest
? Establish standard contract templates covering 7 major systems to ensure compliance for all types of commercial and trade practices? Update the latest compliance requirements to templates annually for company-wide adoption in all business processes
? Comply with the competition regulations and business ethics of the countries and regions in which we operate? Do not make false and misleading statements or make inferences about competitors? Do not maliciously defaming competitors? Conduct anti-money laundering-related compliance risk assessments? Integrate anti-money laundering-related requirements in procurement activities covering production materials, assets, frameworks and services? Check the authenticity and legality of transactions through supplier certi?cation, contract con?rmation, invoice audit, and veri?cation of sporadic receipts to strengthen the supervision of economic behaviors? Establish a con?ict of interest system, and set up different management requirements accordingto different job positions and levels? Organize and conduct an internal con?ict of interest declarations.
Compliance Management System
In terms of compliance promotion and training, the Company regularly organizes all employees to studyrelevant systems such as the BCG. Specialized training is provided for key personnel in the process torequire all employees to comply with the code of business ethics. Additionally, we conduct regular andspecialized compliance training for all employees, and continuously improve the compliance awareness ofthe management and employees through publicity, training, examination and other methods.The company adopts a "zero tolerance" approach towards corruption and commercial bribery, promotingresponsible governance through the construction of an anti-corruption system and the cultivation of aculture of integrity. We have stipulated fundamental provisions on anti-corruption in regulations such asthe BCG and INOVANCE Management Procedures of CSR and Business Ethics, and further strengthenedanti-corruption management through measures such as the INOVANCE Workplace Accountability Man-agement System, INOVANCE Employee Discipline Policy, INOVANCE Gift Acceptance Policy, andINOVANCE Honest Cooperation Agreement for suppliers.The Company established the Integrity and Honesty Working Committee in 2018. The Chairman is thedirector of the Committee and the directors of each department are the integrity ambassadors, who areresponsible for coordinating and promoting the implementation of integrity-related work and reportingthe work progress to the Board of Directors on a regular basis.The Company has formulated the INOVANCE Anti-fraud Whistleblower System to standardize the man-agement of anti-corruption reporting, set up an anti-corruption whistleblower hotline and email, andpromoted them through the Company’s ocial website, “Integrity INOVANCE” ocial WeChat account,posters and other ways to establish accessible anti-corruption whistleblowing channels, and to ensure fair,effective, and timely handling of any potential corruption incidents.Meanwhile, the Company has established the INOVANCE Incentive Plan for Anti-fraud Whistleblowers,which speci?es the incentive mechanism to encourage employees, suppliers and partners to join ouranti-corruption supervision. We have established a sound system for investigating and handling anti-cor-ruption complaints, with the Audit Department as s the sole department to receive complaints to ensurethe independence and impartiality of the investigation results. In addition, we strictly protect the personalinformation of whistleblowers, prohibit any form of illegal discrimination or retaliation and hostile behav-ior towards the people involved in the investigation, and take serious actions against those involved in theillegal disclosure of whistleblower information and retaliation against them.The company continuously strengthened anti-corruption and integrity education for its employeesthrough internal promotions, integrity training, and the promotion of Integrity Commitment Letter andother activities and methods, and promoted the construction of integrity culture. During the reportingperiod, the Company conducted integrity-related publicity and training for directors, senior managementand employees, with a total of 1,791 hours of training, and achieved 100% coverage of anti-corruptionintegrity training.
The Company received 24 reports of anti-corruption clues in 2023, and conducted detailed investigationsbased on the clues. The handling rate of reports and complaints was 100%. During the reporting period,the Company was not received penalties from the competent authorities for violating the laws and regula-tions related to corruption, bribery, extortion, fraud and anti-money laundering.
Anti-corruption and Integrity Building
Receive reports
fromwhistleblowerandconduct investi-gations
Anti-corruptionComplaint andWhistleblowerHandling Procedures
Investigateresponsiblepersons anddepartmentsfor accountability
Responsibledepartmentsrectify theproblemsrelated tointernal control
EMPOWERING
DEARBONIZATION
CHAPTER 4
4.1 Addressing Climate Change
4.2 Innovative Green Products
Feature TopicScope 4 Avoided Emissions
4.3 Strengthening Energy Management
4.4 Focusing on Environmental Compliance
4.5 Enhancing Resource Utilization Eciency
The global ecological crisis caused by GHG emissions is an unavoidable topicwhen people discuss sustainable development. Meeting the Paris Agreement's2°C warming target requires collective action and emission reduction commit-ments from all nations.Leveraging the technological advantages of intelligence,automation, and greenness within the products and solutions, INOVANCE notonly strengthens green operation and ful?ll commitments on carbon reductionbut also empower different industries with core business to steering industrygreen and low-carbon transition.
Empowering DecarbonizationEmpowering Decarbonization
Climate change poses a signi?cant long-term risk to the stability of global ecosystems, economic develop-ment, business operations, and individual well-being. Actively addressing climate change and enhancingclimate resilience are focal points of INOVANCE's efforts to the realization of SDG 13.In this report, INOVANCE ?rst discloses climate-related information and management progress in accordancewith IFRS S1 issued by ISSB. We have established a clear governance structure for climate action, rearmedthe Company's "dual carbon" strategy, identi?ed climate-related risks, seized green opportunities and trackedthe progress of performance indicators and goals.Based on ESG governance framework, the Company has clearly de?ned roles and responsibilities at each orga-nizational level to enhance the proactiveness and continuity of climate action and ensure the ecient imple-mentation of related initiatives.
4.1 Addressing Climate Change
4.1.1 Governance
Climate change is both risk and opportunity for INOVANCE. The Company developed strategy coping withclimate change from the perspective of risk response and opportunity capture.
4.1.2 Strategy
INOVANCE has integrated climate-related risks into our company's risk management processes. We identifytypes of climate risk, assess potential positive and negative impacts, set priority based on the impact and prob-ability of risk occurrence, and develop appropriate mitigation plans.
4.1.3 Risk Management
· Formulate and implement work plans related to climate change response based on the company's strategy.
· Review and make decisions on the company's climate change strategy, goal and speci?c matters.· Monitor and management of the work related to climate change.· Review the company's climate-related information disclosure.· Review and monitor the progress of climate action, quanti?ed performance, and goals achievement status.· Review related policies of climate and energy and provide guidance on relevant budgeting plans.· Provide resources and guidance to relevant executive departments for taking climate action.· Monitor the company's climate risks and opportunities and formulate corresponding management measures.· The Sustainability Oce is established to identify and analyze climate risks and opportunities, provide guidance on climate actions, promote and publicize work on climate change response, and track the implementation of speci?c matters by relevant executive departments.
Organizations atEach Governance Level
Speci?c Responsibility
Strategy onAddressing ClimateChange
Climate RiskResponse
RiskMitigation
Strengthen the Company's green operations, ful?llcommitment to GHG reduction and improve supplychain sustainability management.
RiskAdaptation
Identify and analyze major climate-related risk, assessthe potential impact on corporate business strategyand ?nances and develop response plans for differenttypes of risks.Green Opportunity Capture
In line with the green and low-carbon transition trend,the Company develops energy-saving and eciency-enhancing products and builds solutions integratedwith intelligence, automation and greenness fordifferent carbon reduction scenarios.
INOVANCE Climate-related Risk Identi?cation and Response
Type of RiskRisk DescriptionPotential Analysis of Relevant Risk
PotentialFinancialImpact
Responding Measures
AcuteRiskPhysicalRisk
OperatingCosts Revenue AssetValue
Extremeweather causedby climatechange
Extreme weather such as typhoonsand ?oods may damage buildingsat production and oce operationalsites, thereby affecting normalproduction and operationsExtreme weather may affect thesafety of employee commuting,thereby impacting normal businessoperationsExtreme weather may causetemporary supply chain disruptions,affecting normal product delivery
We develop and implement responseplans for emergencies such astyphoons, earthquakes, heavy rainfall,power outages, ?res, food poisoning,and major infectious diseases tominimize losses caused by naturaldisastersWe attach great importance toemployee's health and safety,implement early warning andnoti?cation for extreme weather andoffer ?exible arrangements forproduction and work as well asreporting mechanismsISC established internal emergencyplan on business disruption caused byextreme weather such as typhoons
Type of Risk
RiskDescription
Potential Analysis of Relevant RiskResponding Measures
ChronicRiskPhysicalRisk
OperatingCosts AssetValue
The increasingglobal averagetemperature,sea level andthe frequencyof publichealthemergencies
Sea level rise may affect the normaloperation of the company'sheadquarters and subsidiarieslocated in coastal areas, resulting inrelocation costsThe rise in global average tempera-ture may lead to an increase inenergy consumption for cooling inoce and production areasThe rise in global average tempera-ture may affect product lifespan andperformance, and warehouse siteselection may changePublic health incidents caused byclimate change may affect thecompany's normal production.
We take climate-related risk intoconsideration when selecting newoperational sitesWe use digital energy managementsystems to precisely control andmanage energy consumption andimplement optimization solutions forenergy eciency of air conditionsWe monitor different externalenvironmental conditions that mayaffect product lifespan and perfor-mance, and provide clear explanationsto consumersWe develop internal response plan forpublic health incidents such as majorinfectious diseases, and makepreparation for medicines andsupplies
TransitionRisk
OperatingCosts
PolicyandLegalRisk
Climate-rlaeddisclosureregulations
Strictrequire-mentsforclimate-relatedinfor-mationdisclo-sure
Sustainability reportingrequired by the listedexchange may graduallystrengthen climate-relat-ed disclosure require-mentsThe implementation ofEU Corporate Sustainabil-ity Reporting Directive(CSRD) may affect theCompany's ESGdisclosure and putforward new require-ments.
We stay informed about ESGinformation disclosure requiredby the listed exchange and coreoperating regions and ensure thedisclosure are in compliance withlcoal laws, regulations andguidelines
Revenue
OperatingCosts Revenue FinancingDiculty OperatingCosts Revenue AssetValue FinancingDiculty
MarketRisk
TechnologyRisk
ReputationRisk
Change ofCustomer'sBehaviours
Energy-saving andCarbon-reductionTechnology
NegativePublicOpinionsand ActionsViolatedLaws andRegulations
Energy-savingand carbonreductiontechnologythat fallsbehindmarketdemands
Customer'spreference forgreen andlow-carbonproduct
Reputationloss caused byclimate-relatednegativepublicopinions andviolatedactions
We integrate sustainabilityrequirements into productdevelopment, highlight green,energy-saving, and low-carbonfeatures, and proactively meetcustomer ESG requirements forsuppliers and product delivery inadvanceWe keep focusing on the insightsof market demands forenergy-saving and carbonreduction in products, formulateR&D strategies with adequateinvestment, and gradually narrowthe technology gap with peersWe maintain a high tolerance forerrors in new technologydevelopment and allow fortrial-and-error costsWe stay alert on the change oflaws and regulations in ouroperating regions, and enhancenegative public opinion monitor-ing to verify the authenticity ofissues and correct with respond-ing actions
Customers set ESGsupplier entry require-ments and may havehigher requirements forthe products with greenand low-carbon featuresInvestment in energy-sav-ing and carbon-reductiontechnologies that fallsbehind peers may resultin failure to ful?ll marketdemandInvestment in the R&D ofnew technology carriesthe risk of failureThe Company's carbonreduction commitmentsdo not met or complywith relevant regulationson GHG emissions in thecountries and regions theCompany operates
Transition
Risk
OperatingCosts Liabilities
GHGEmissionsControl andManage-ment
Strengt-henedcontroloncarbonemis-sionsfrombusi-nessopera-tion
The requirements fornational carbon peakingand carbon neutrality inthe industrial sector mayaccelerate the Company'sgreen and low-carbontransitionInternational markets,represented by the EU,may strengthen carbonfootprint control of exportproducts and "green-washing" behaviors
We increase R&D investments ingreen and low-carbon technolo-gies, strengthen energy andcarbon emission management,and implement energy-savingand carbon reduction measuresWe stay informed about relevantlaws and regulations concerningenergy and GHG emissions in theoverseas markets, proactivelyidentify compliance requirementsand gaps, and strictly adhere tolocal laws and regulations inbusiness operations
PotentialFinancialImpact
Type of Risk
RiskDescription
Type of Risk
RiskDescription
Potential Analysis of Relevant RiskResponding MeasuresPotentialFinancialImpact
Physical Risk
Acute RiskChronic Risk
Transition Risk
Policy and Legal RiskMarket RiskTechnology RiskReputation Risk
Strict Requirements for Climate-related Information Disclosure
Strengthened National and Industrial Control on Carbon Emissions
Customer's Requirements for Green and Low-Carbon Product
Customer's Preference for Green and Low-Carbon Product
Energy-saving and Carbon Reduction Technology Falling Behind Market Demands
New Technology R&D or Investment Failure
Failure to Achieve Carbon Reduction Goals
Negative News Reporting on Climated-related Matters
High Occurrence Frequency of Extreme WeatherThe Rising Average Temperature in the GlobeThe Rising Sea Level in the GlobePublic Health Emergencies Brought by Climate Change
Physical RiskTransition Risk
LowMedium
Medium
High
High
TheImpactofRisk
The Possibility of Risk Occurrence
Climate change presents INOVANCE with both challenges beyond traditional enterprise risk managementand emerging market opportunities. Providing customers with more intelligent, green, and energy-ecientproducts and solutions will help the Company maintain a favorable position in the global low-carbon transi-tion.
INOVANCE Climate-related Opportunity Identi?cation and ResponseType ofOpportunities
Opportunity Description
PotentialFinancial Impact
Responding Measures
Revenue OperatingCost
The increasing requirements for energyconservation and emission reduction acrossindustries are driving a surge in demand forenvironmentally friendly and low-carbonproducts and services.
The shift towards sustainabilitypresents opportunities forexpanding our customer base anddeveloping innovative productsthat cater to the growing demandfor energy-ecient and low-carbonsolutions.
OperatingCost Revenue
By continuously improving greenoperations, design, manufacturing,packaging, and logistics, we canfurther strengthen our competitiveadvantage.
Customers from the overseas market andnew energy sector are progressively incorpo-rating sustainability criteria into their supplierselection processes. As certain peers lag intheir commitment and capabilities tocustomer requirements, we have an opportu-nity to gain a competitive edge.
Revenue
Our core products and solutionseffectively address the challengesfaced by customers in the newenergy sector, facilitating theimplementation of their projects.We also have strategicallyestablished a comprehensiveenergy management platform andenergy storage business encom-passing "Power Generation, Grid,Load, and Storage".
A reduction in fossil fuel dependence and acorresponding increase in the utilization ofclean energy sources are the importantsolutions to mitigate climate change fromthe energy side. By actively supporting thedevelopment of the new energy sector andparticipating in new energy projects, we canunlock new opportunities for businessgrowth and diversi?cation.
Revenue
Operating
Cost
We are committed to optimizingresource utilization within ouroperations guided by the principle"energy conservation, materialconservation, and eciencyenhancement." Leveraging digitalplatforms, we are implementingre?ned management measures toenhance operational eciency.Additionally, we plan to extend thecapabilities of our digital platformsto empower both customers andsuppliers, fostering industry-wideimprovements in resourceutilization.
Improving the eciency of natural resourceutilization, minimizing the environmentalimpact of our operations, and reducing ourecological pressure are crucial steps inaddressing climate change. Enhancingresource utilization eciency and imple-menting lean management principles will beimperative for our long-term business.
Operating
Cost
Our new production bases areconstructed 100% in accordancewith green factory standards. Wehave also proactively developedcomprehensive contingency plansto ensure business continuity in theface of climate-related risks,thereby initially improving ourresilience to climate change.
Proactive measures to adapt to climatechange can mitigate potential ?nancial losses.
To echo national "3060" carbon peaking and carbon neutrality goals and drive industry green and low-carbontransition, INOVANCE announced "2850" and "3030" carbon reduction goals in 2022 and further speci?ed thegoals in 2023.
4.1.4 Metrics and Targets
“2850”
INOVANCE
Carbon Reduction
Goals
Goal Description
“3030”
MajorSuppliers
Target202820302050To achieve operationalcarbon peaking by 2028and operational carbonneutrality by 2050
To decreaseoperational GHGemissionintensity (Scope 1+Scope 2) by 35%compared to2021To reduce major suppliers’GHG emissions by 30%compared to 2021 by2030.
To realize carbonneutrality inoperation
To decrease GHGemissionintensity by 30%Since 2021, the company has conducted annual GHG inventory to monitor the progress of carbo n reduction.This year, we implemented carbon inventory in line with the organization's scope of annual consolidated ?nan-cial report with reference to ISO 14064. In addition to Scope 1, 2, and 3, Scope 4 (avoided emissions) wasincluded this year. We engaged a third-party organization to verify the GHG inventory results of major emissionorganizations including Suzhou INOVANCE, INOVANCE Automotive, and Changzhou INOVANCE New Energy.The veri?ed Scope 1 and Scope 2 emissions accounted for 71.5% of Scope 1 and Scope 2 of the organization'sscope of annual consolidated ?nancial report.
Led by the "2850" and "3030" carbon reduction goals, INOVANCE spares no effort seizing clean tech opportuni-ties. We continuously tap the carbon reduction potentials of our products and solutions, develop green, ener-gy-saving, and highly-ecient products, and innovate energy-saving and carbon reduction solutions to applyin the industrial, construction, transportation, and new energy sectors. While achieving our sustainable devel-opment, we also promote the green and low-carbon transition of the entire industry chain.
GHG EmissionsUnit2023202220211,807.90121,345.34883,727.5010,748,527123,153.24
4.05
1,601.9079,808.38
81,410.28
3.52
//
1,933.3663,005.29
64,938.65
3.62
//
tCO2etCO2e
tCO2e
tCO2e
tCO2e
Scope 1 Direct EmissionsScope 2 Indirect EmissionsScope 3 Other Indirect EmissionsScope 4 Avoided EmissionsTotal Emissions (Scope 1 + Scope 2)GHG Emission Intensity
tCO2e
per million RMB
4.1.5 GHG Reduction Actions
INOVANCE has implemented a series of GHG reduction actions aligned with the "2850" and "3030" goals.Core initiatives include establishing an energy and carbon emission management platform, building greenand zero-carbon factories, and increasing investment in green product design and R&D, to ultimately acceler-ate the achievement of emission reduction goals across the entire value chain.
“2850”
INOVANCE
CarbonReduction
Goals
Target20232024202620302050
· ImproveManagementSystem· Comprehen-sive EnergyConservationDiagnosis
· ConstructIntegratedFacilities ofPhotovoltaics,Energy Storageand Charging· ManageProduct CarbonFootprint
Green SupplierManagementPlatform
Explore CarbonReductionInitiatives
IntroduceCarbonNegativeMeasures tooffset the Restof Emissions
MajorSuppliers
“3030”
·Analyze CO2emissionManagementStatus·Set CarbonReductionGoals and Plans
Promote GreenManufacturingSystem
/
· ProvideINOVANCEwith Zero-Car-bon Productsand Services· PromoteCarbonNeutrality ofEntire IndustryChain Together
· Complete andImproveManagementSystem· EstablishEnergy andCarbonEmissionManagementPlatform andMonitor theEnergyConsumptionand CarbonEmissions of· ProductionPrioritize to UseRenewableResource
For more details of carbon reduction action, please refer to 4.2 Innovative Green Products and 4.3 Strengthening Energy Management
4.2 Innovative Green Products
2023 Key Performance Indicator
GHG Emissions Scope 4 Avoided Emissions
tCO210,748,527
4.2.1 Accelerating R&D in Clean Technology
In the context of the national "Dual Carbon" goals, INOVANCE views the demand for green and low-carbonproducts as a signi?cant business opportunity. In 2023, the company has increased R&D investment in cleantechnology to support energy eciency improvements within products and solutions. Below is an exampleof energy storage technology.
4.2.2 Promoting Green Products
INOVANCE adheres to the principle of green design with the INOVANCE Product Identity Design Guidebookpublished as a fundamental guideline for product design. The guidebook explicitly states that productdesign should follow the principles of "material conservation, process simpli?cation, packaging minimization,and functional modularization" to comprehensively reduce carbon emissions and resource consumptionthroughout the product lifecycle, further enhance the environmental protection and sustainability of prod-ucts, and contribute to the realization of the company's vision of "advancing industrial technology for abetter world."
Subsidiary INOVANCE Automotive is committed to developing green and zero-carbon products by continuous-ly increasing the development and application of renewable materials. INOVANCE Automotive has publiclypledged to achieve 40% recycled aluminum and 30% recycled plastic in their products by 2026, and to developgreen and zero-carbon products by 2030. During the reporting period, the company conducted Life CycleAssessment (LCA) carbon footprint analysis on several key products, including NEV electric drives, motors,powertrains, power supplies, PCS, and high voltage energy storage system. The company leveraged internaland external resources to improve their carbon emission factor and enhance LCA capabilities, laying a soliddata foundation for developing zero-carbon products throughout the entire lifecycle.Energy Storage Technology Achievements in 2023Addition of new power modules, resulting in higher power density, smaller size, and higher eciency forenergy storage products.Improvement and accumulation grid-connected and grid-forming energy storage algorithms toenhance energy utilization and conversion eciency.Dynamic analysis and tracking of energy consumption data through Battery Management Systems (BMS) andEnergy Management Systems (EMS), with plans to add and optimize functions such as optimized dynamicbattery energy management, fault prediction, and lifespan prediction in the future.Strengthened application of thermal management technology in energy storage products, such as watercooling and microchannel thermal management technology.
Optimize productionprocesses, reduceprocessing steps,improve productproduction eciency,and avoid material andenergy consumptioncaused by redundantprocesses.
Material ConservationProcess Simpli?cationPackaging MinimizationFunctional ModularizationReduce product weightor volume throughproduct design optimi-zation, focus on theselection of green andrenewable raw materials,and thereby reduce theconsumption of productmaterials.
Adopt a reasonable andcompact structure, applymodular thinking,optimize and simplifycomponent separation,and reduce resourceconsumption through-out the productionprocess.
Streamline packagingsize, save packagingmaterials, graduallyreplace disposablepackaging materialswith recyclable orreusable materials, andminimize packagingwaste.
MV33 Low-voltage PM MotorsMD290 Standard VectorControl AC Drives
The motor utilizes ?at wire to reduce productsize and meets the IE5 high-ecient motorstandard of the International ElectrotechnicalCommission (IEC). The product surface coatinghas been changed from oil-based paint towater-based paint, reducing volatile organiccompound (VOC) emissions and making itmore environmentally friendly.
The MD290 series AC Drives adopt a long-lifedesign for extended product lifespan as well asan independent air duct design to adapt tovarious harsh and polluted environments. Thisseries also use a re?ned design that reducesproduct size by 30%. The product hasobtained CE, UL, CUL, RoHS, and KC certi?ca-tions for export requirements. In 2023, wesuccessfully received the Korean Emarkhigh-ecient energy certi?cation for this product.
Green and Energy-Saving Product Design
Industrial SectorVector-Control High-Voltage AC Drive & PM Motor Solution Supports GreenDevelopment in the Coal Industry
To meet the production needs of "Smart Mines" and address the new requirements of safe, ecient,green, low-carbon, and intelligent coal mining, INOVANCE provides high-quality, high-eciency prod-ucts and green solutions for coal mining companies. The successful application of self-developedhigh-voltage AC drives combined with the "dual-adjustment optimization" technology solution ofadjustable-speed fan in the device upgrade project of adjustable blade axial-?ow fans and induceddraft fans in coal-?red units has achieved ?exible adjustment of coal-?red units while meeting theprocess requirements for wind pressure or air volume by adjusting the fan speed and blade anglethrough high-voltage AC drives. This reduced the coal consumption per kilowatt-hour of power plants,lowered the entire plant power consumption by 0.3~0.5% or more, and achieves a comprehensivepower saving rate of over 20%. By shifting the fan performance curve, it can provide technology foradjustable-speed fans to maintain high-eciency operation.The vector-control high-voltage AC drive & PM motor solution combine the advantages of direct-drivePM motors and application dedicated AC drive, with key technologies such as high-reliability design,ecient soft-start technology, stepless speed regulation and harmonic suppression technology, motor+ electronic control integration technology, and intelligent operation and maintenance managementas breakthroughs, promotes energy saving, low energy consumption, and intelligent development oftransportation systems at coal mines.
In 2023, our green and low-carbon products and solutions were successfully applied in the sectors of Industrial,Construction, Transportation and New Energy.
Construction Sector
"INOVANCE Brain" - Elevator Component Intelligent Solution PromotesLow-Carbon Elevator Management
In July 2023, INOVANCE released the "INOVANCE Brain," an elevator component intelligent solutionbased on digital management structured with "4+1+N". "4" refers to the four core intelligent compo-nents (control system, drive system, human-machine interface, and door machine) equipped withCPUs and empowered by digital twins technology. The components are able to perceive the physicalword and present operating and fault mechanisms by digitalization. "1" refers to an intelligent commis-sioning APP which can conduct accessible communicate with human beings throughout the elevatorlifecycle. "N" refers to the integration of N business process scenarios of elevator companies throughintelligent commissioning, signi?cantly improving the elevator safety and the work eciency of main-tenance and factory inspection personnel. Based on digitalization platform, the solution can link multi-ple business scenarios and thereby provide a foundation to elevator energy and carbon emission man-agement.
Transportation Sector
Power Sector
Hebei Shunping 20MW/40MWh "Photovoltaic + Energy Storage" ProjectSupports Local Clean Energy Use
INOVANCE assisted Jiangsu Linyang Energy Co., Ltd. in successfully connecting the 20MW/40MWhphotovoltaic and energy storage power station to the grid in Shunping County, Hebei Province. Thisproject is part of the 100MW photovoltaic power generation project in Taiyu Town, Shunping County,Baoding City, covering an area of over 2 km
2. The total planned power capacity scale is 100MW, and the
planned installed capacity of the energy storage power station in this phase is no less than20MW/40MWh. It adopts a 1000V 0.5C air-cooling system and is equipped with 5 sets of 3.78MW highvoltage energy storage system from INOVANCE. The Linyang Energy Hebei Shunping 20MW/40MWhphotovoltaic and energy storage power station uses advanced technology and builds an energy storagesystem based on lithium iron phosphate battery technology. It provides storage and release of aban-doned wind or light for local new energy power plants, effectively alleviating the diculty of absorbingpower generated by clean energy during peak hours, and realizing a "energy storage factory" at thesource. After the power station is successfully connected to the grid, it is expected to generate 137.061GWh of electricity annually. Compared with thermal power generation with the same power genera-tion capacity, this is equivalent to saving 43,200 tce and reducing CO2 emissions by about 111,600 tonsevery year. The photovoltaic and energy storage project avoids the "uneven busyness" of the powersystem by peak shaving and valley ?lling, ensures the safe and stable operation of the power system,supports the large-scale development of clean energy, and is of great signi?cance to promoting ruralrevitalization and development in Shunping County, Baoding City.
Off-shore Power Systems Contribute to Energy Conservation and EmissionReduction
INOVANCE's off-shore power technology has integrated digital technology to create a professionaloperation and maintenance management system for off-shore power, standardizing the ship connec-tion process and visualizing electricity consumption data. Up to now, INOVANCE has constructed(including those under construction) 240 sets of port off-shore power systems, assisting 70 port termi-nals to achieve regular off-shore power connection for ships, with over 10,000 connections and cumula-tive electricity consumption exceeding 50 million kWh. It is estimated that the off-shore power systemsprovided by INOVANCE can reduce annual CO2 emissions by 271,162,935.2 kg, SO2 by 2,571,100.16 kg,and NOx by 1,845,812.8 kg.
Reliable Components for New Energy Vehicles to Support a Green AsianGames
As a leading domestic supplier of NEV components, INOVANCE Automotive provided the Geely Inter-stellar Bus C6E and C8E models, which served as the ocial vehicles for the 19th Hangzhou AsianGames, with bus ?ve-in-one integrated controllers (BD35-1) and light truck ?ve-in-one integratedcontrollers (LD35-1). Additionally, the company dispatched a professional service team to activelyparticipate in the vehicle maintenance support for the Asian Games, providing a solid guarantee for thegreen and low-carbon travel of the event.
“Avoided Emissions” is de?ned as “a solution that can ful?ll the same functions but with signi?cantly lessgreenhouse gas emissions”, according to the Net Zero Innovation Module 2: The Avoided Emissions Frame-work V3 2020 published by Mission Innovation. Common examples of “avoided emissions” are as follows:
A. One product is used as a substitute for another carbon-intensive product. For example, telephone or videoconferences are used as substitutes for conventional business trips and meetings, or the manufacturing ofwind turbines helps to substitute fossil fuels in electricity generation and reduce the emissions of the wholesociety.B. One product is used to promote other processes to reduce emissions. For example, if a real estate companyconsiders the allocation of public transport facilities in the community development stage, residents will beencouraged to choose public transportation more often after moving in, thus reducing emissions.Such “Avoided Emissions” are also called “Scope 4” or “Scope 3+” to distinguish them from the routine organi-zation carbon emissions and value chain carbon emissions.With an increasing concern of human beings for climate change topics, many organizations across the globehave taken action to control their GHG emissions. However, it should be pointed out that the temperaturecontrol target of 2°C in the Paris Agreement to be achieved jointly by us cannot be at the expense of the devel-opment of material and spiritual civilization of human society. Instead, we should pursue a synergy betweensocial development and ful?lled climate goals, which can be made possible through commercial and techno-logical innovation. With such innovation, more, greener products and services can be provided to the wholesociety, and climate goals can be jointly accomplished while continuously improving human life and achievingthe sustainable development of human society.This requires us to provide more, greener products and services to the whole society and jointly accomplishclimate goals while continuously improving human life and achieving the sustainable development of humansociety. In other words, more organizations should not only focus on “doing less harm” but also make efforts in“doing more good”.Ever since its establishment, INOVANCE has been providing products and services with signi?cant characteris-tics of “avoided emissions”. For example, the application of AC Drive products can reduce the energy consump-tion of various production machinery and can thus avoid GHG emissions caused by power generation andpower transmission. Another example is that INOVANCE, as a supplier of core parts and components for newenergy vehicles, has boosted the green transformation of transportation by offering competitive products andsolutions to new energy vehicle manufacturers. Therefore, in our views, the avoided emissions brought by prod-ucts and services can create more social value compared to managing our own operational carbon emissions.In order to better assess the social bene?ts brought about by the avoided emissions, we specially add thischapter, hoping to establish more extensive connections with more stakeholders in jointly coping with thechallenges caused by climate change.
Based on the actual business status of INOVANCE, our Scope 4 is divided into two categories:
(1) Directly avoided emissions
(2) Collaboratively avoided emissions
1.Directly Avoided Emissions
Directly avoided emissions refer to that a facility or equipment, after using INOVANCE’s products or solutions,does not signi?cantly change its core feature or form, but rather produces notably less GHG emissions beyondthe value chain while ful?lling the same functions. For example, the AC Drive products supplied by INOVANCEto the air-conditioning industry have obtained the effect of energy conservation and emission reduction with-out changing the core feature of the air-conditioning systems. This effect is regarded as the Directly avoidedemissions in INOVANCE’s Scope 4.
2.Collaboratively Avoided Emissions
Collaboratively avoided emissions refer to that INOVANCE, in synergy with its industrial partners, has jointlycontributed to a fundamental change or substitution of a facility or equipment, and such change or substitu-tion has produced notably less GHG emissions beyond the value chain. For example, INOVANCE, in synergywith wind turbine manufacturers and other suppliers of wind turbine parts and components, has jointly boost-ed the development of clean energy power generation and reduced GHG emissions from coal-?red powergeneration.
Feature TopicScope 4 Avoided Emissions-Contributing Solutions to Climate Action
Two Categories of Scope 4
Differences between Directly Avoided Emissions and Collaboratively Avoided Emissions
NoYesAll Allocated to INOVANCEPartially Allocated to INOVANCE
Directly Avoided EmissionsScope 4 CategoryCollaboratively Avoided Emissions
Whether there is anychange in the core
feature of theequipment/facilities
Ownership ofavoided emissions
The calculation logic is as follows:
Directly avoided emissions = Emissions of the original equipment or facilities under the baseline scenario -Emissions of the equipment or facilities after using products and solutions of Directly avoided emissions underthe same scenario
BAUBaseline
Solution EmissionosNet Avoided Emissions
ReboundEffects
EnablingEffects
Calculation Method for Avoided Emissions
Considering that:
a) the emissions generated by INOVANCE’s products (referring to the cradle-to-gate carbon footprint of prod-ucts) are generally much lower than the avoided emission effect brought about by them;b) no signi?cant rebound effect has been identi?ed in INOVANCE’s product application scenarios up to now;To simplify data collection and calculation, this report does not include the solution emissions and therebound effect.
Accounting Boundary
System boundaryFunctional unitTime range
GHG emissions generated by the equipment or facilities applying INOVANCE’sproducts during their useEach equipment or facility equippedwith INOVANCE’s products
Each substitute equipment or facilitywith the same functionsFrom 1 January 2023, to 31 December 2023
Directly Avoided EmissionsCollaboratively Avoided EmissionsScope 4 Category
Directly Avoided Emissions
1.In the following ?ve cases, the calculation formula for Directly avoided emissions is as follows:
2.In the following cases, the calculation formula for Directly avoided emissions is as follows:
Note 1: Unless otherwise stated, the value is 12 according to the world average of IEA EE Electric Systems;Note 2: Unless otherwise stated, the value is 250 according to the world average of IEA EE Electric Systems;Note 3: The GHG emission factor refers to 0.5703 tCO2e/MWh in the Notice of the Ministry of Ecology and Environment of the People's Repub-lic of China on the Management of Greenhouse Gas Emissions Reporting by Enterprises in the Power Generation Industry for 2023-2025(2023);Note 4: Calculated based on the Company’s sales data in 2023;Note 5: Calculated based on the data in Johnson Controls: The bene?ts of variable speed drives for high-load chiller operations;Note 6: Calculated based on the data in Johnson Controls: The bene?ts of variable speed drives for high-load chiller operations;Note 7: The annual working hours here are 8,760 hours according to the calculation method in Johnson Controls: The bene?ts of variable speeddrives for high-load chiller operations;Note 8: Determined by the Company’s internal expert opinions, and the following data are quoted from the Company’s internal expertopinions unless otherwise speci?ed;Note 9: Quoted from Ingersoll Rand: INDUSTRY AND THE ENVIRONMENT BENEFIT FROM NEW AIR COMPRESSOR TECHNOLOGIES THATENABLE ENERGY EFFICIENCY, OPTIMISED PERFORMANCE AND GREATER RELIABILITYNote 10: Quoted from Allen G. Neciosup: Comparing the energy savings impact of a permanent magnet motor and induction motor in adjust-able speed drive applications
Note 1: Calculated based on the Company’s sales data in 2023;Note 2: Quoted from China Elevator Association Standard T/CEA 8016-2022;Note 3: Quoted from Schindler: Regenerative Drive Upgrades.
Scenario/Facility/Equip -ment nameCentral air conditionerwith AC driveAir compressor with ACdrive
Baseline scenario
INOVANCE’s productsapplied
Newly installedcapacity ofINOVANCE’sproducts in 2023
Note 4(kW)
Averageload rateofequip -ment
Averageenergy -savingrate
(tCO2e/year)
2,911
note1
note2
25%note35,978
Scenario/Facility/Equip -ment name
Vertical elevatorsequipped withelevator control -lers/drives withan energyfeedback function
Baseline scenario
INOVANCE’sproducts applied
Annualelectricityconsumptionof verticalelevators notequippedwith elevatorcontrol -lers/driveswith anenergyfeedbackfunction
MCTC-AFEproducts
Number of new verticalelevators equipped withINOVANCE’s elevatorcontrollers/drives inbuiltenergy feedback function in2023 (unit)
Average dailyelectricity consump -tion of verticalelevators withoutenergy feedbackfunction (kWh)
Averageener -gy-savingrate
Avoidedemissions(tCO2e/
year)
Directly avoided emissions= New installed capacity in 2023 * Average load rate * Average energy - saving rate* Average daily working hours
Note 1 * Average annual working days
Note 2
* GHG emission factor
Note 3
686,582
note7
1,503,754
99,480
63,930
979,328
1,700,920
3,587,449.5
1,211,339
622,771
5,724,047
24,180,000
76%
note5
70%
note8
50%
30%
60%
35%note9
11%
note6
8%
note10
20%
20%
1,034,30850%5%
Scenario/Facility/Equip -ment name
Various equipment/facil -ities equipped withenergy-ecient PMmotorsVarious equipment/facil -ities equipped with ACdrive energy feedbackfunctionVarious injectionmolding machines, die -casting machines,bending machines andhydraulic stationsequipped with hydraulicservo systems
Other equipment/facili -ties equipped with ACdrive
Annual electricityconsumption of centralair-conditioning systemsnot equipped with ACdrivesAnnual electricityconsumption of aircompressors notequipped with AC drivesAnnual electricityconsumption ofequipment usinginduction motors withIE3 or a lower energyeciency levelAnnual electricityconsumption of varioussimilar equipment/facili -ties not equipped withAC drive energyfeedback functionAnnual electricityconsumption of varioussimilar equipment/facili -ties not equipped withhydraulic servo systems
Annual electricityconsumption of variousequipment notequipped with AC drive
Baseline scenario
INOVANCE’s productsapplied
CA200/300/500 series ACdrive productsCP200/650/700 series andMD510 series AC driveproductsMDD31\51 series andMV21\31\33\61 seriesmotor productsPart of MD880 series, MD050and MD051 series, and partof HD9X(S) series productsES510\560\580\590\600\630\650\660\680 products
MD200/290/310/480/500/500PLUS/520/580/600/800/810/880, CS200/290/300/710/740,MD100C/100P, and CL100products
Averageload rateofequip -ment
Averageenergy -savingrate
(tCO2e/year)
Directly avoided emissions= Number of new vertical elevators equipped with elevator controllers and inverters with an energy feedback function* Average daily electricity consumption of vertical elevators without an energy feedback function * Average energy- saving rate * GHG emission factor
Newly installedcapacity ofINOVANCE’sproducts in 2023
Note 4(kW)
1,218,360,000
note1
0.00728
note2
0.15745
note3
182,97010%
The GHGemissioncaused by allother landtransporta-tion meth-ods toachieve thesamepassengertransporta-tion distance
18,297
Equipment/Facility name
Subway/light railvehicles
Baseline scenario
Total passengertransportation distancecontributed bysubways/light railsequipped withINOVANCE productsdelivered in 2023
GHG emissionfactor ofsubways/lightrailskgCO2e/passen-
ger · km
Average GHGemission factor of allother on landtransportationkgCO2e/passenger.km
AnnualCollabora-tivelyavoidedemissions(tCO2e)Alloca-tionpropor-tion
Collabo-rativelyavoidedemissionsallocated(tCO2e)
Positioning ofvalue chainactivitiesAllocation propor -tion
Primary activities
Secondaryactivities
Tertiary activitiesOther activities50%30%10%10%
Electric vehiclemanufacturers
Battery manufacturersINOVANCEOther suppliers
3.For new energy vehicles using SiC-based electric drive, the calculation formula for Directly avoided emissions
is as follows:
The allocation of Collaboratively avoided emissions is based on the principle of “actual contribution degree”and as per the technical contribution degree. The speci?c allocation proportion is as follows:
For the Collaboratively avoided emission effect brought about by rail transit, the calculation formula is asfollows:
Note 1: Calculated based on internal sales data and the relevant industry reports;Note 2: Quoted from Business travel- land, UK Government GHG Conversion Factors for Company Reporting;Note 3: According to Toyota’s ocial website, the application of SiC MOSFET is conducive to improving the endurance mileage of electricvehicles by about 5%-10%, so the median value of 7.5% is taken here
Collaboratively Avoided EmissionsAllocation Rules for Collaboratively Avoided Emissions
Rail Transit
Note 1: Calculated based on the proportion of the number of products delivered by INOVANCE in 2023 to the number of vehicles on thesubway line, operating mileage of the subway line where they are located, average mileage proportion, and annual passenger ?ow, and theoriginal data involves trade secrets and cannot be disclosed;Note 2: Quoted from Business travel- land, UK Government GHG Conversion Factors for Company ReportingNote 3: Calculated based on the average car emission factor in Business travel- land
7.5%
note3
2,064
Scenario/Facility/Equip -ment name
New energyvehicles equippedwith INOVANCE’sSiC-based electricdrive, e-power-train and chargingproducts
Baseline scenario
INOVANCE’sproducts appliedAnnualelectricityconsumptionof electricvehiclesequippedwith electricdrive, e-pow-ertrain andchargingproductspowered byIGBT
Variouselectric drive,e-powertrainand chargingproductsbased on SiCMOSFET
Annual mileage of newenergy vehicles equippedwith INOVANCE’s Sic-basedelectric drive (km)
Average emissionfactor of newenergy vehicles(kgCO2e/km)
Averageener -gy-savingrate
Avoidedemissions(tCO2e/year)
502,170,900
note1
0.0548
note2
10%
Positioning ofvalue chainactivitiesAllocation propor -tion
Primary activities
Secondaryactivities
Tertiary activitiesOther activities
50%30%10%
INOVANCEOther suppliersVehicle manufacturersKey system suppliers
10%
Positioning ofvalue chainactivitiesAllocation propor -tion
Primary activities
Secondaryactivities
Tertiary activitiesOther activities50%30%10%
INOVANCEOther suppliersWind turbine manufacturers
Suppliers of main parts andcomponents (impellers, etc.)Directly avoided emissions= Number of new energy vehicles equipped with Inovance's SiC - based electric drive, e - powertrain and charging products in 2023* Average annual mileage of vehicles * Average emission factor of new energy vehicles * Average energy - saving rate
Collaboratively avoided emissions allocated=* Average mileage proportion * (Emission factor of other ground vehicles - Emission factor of subway vehicles)* Allocation proportion
*Total length of the line * Annual passenger ?ow of the lineNumber of vehicles delivered in the current year
Total number of vehicles on the line
Electric passenger/commercial vehicles
Rail transit
Wind power generation
For the Collaboratively avoided emission effect brought about by wind turbines, the calculation formula is asfollows:
Wind Power Generation
For the Collaboratively avoided emission effect brought about by electric commercial vehicles, the calculationformula is as follows:
Electric Commercial Vehicles
Note 1: It is calculated based on the sales data;Note 2: Statistical data from the Wind Energy magazine;Note 3: This parameter has taken into account the full-load generation rate.
For the Collaboratively avoided emission effect brought about by electric passenger vehicles, the calculationformula is as follows:
Electric Passenger Vehicles
Note 1: Calculated based on the statistical results of sales quantity of INOVANCE’s motor controller, e-powertrain and charging products forelectric passenger vehicles and the average annual mileage of passenger vehicles in 2023, and some data involves trade secrets and cannot bedisclosedNote 2: Quoted from Business travel- land, UK Government GHG Conversion Factors for Company ReportingNote 3: Calculated based on Business travel- land, UK Government GHG Conversion Factors for Company Reporting
Note 1: Calculated based on the statistical results of sales quantity of INOVANCE’s motor controller and bridge products for electric commer-cial vehicles and the average annual mileage of commercial vehicles in 2023, and some data involves trade secrets and cannot be disclosedNote 2: Calculated based on the data released in Business travel- land, UK Government GHG Conversion Factors for Company Reporting andthe electricity consumption data of Yutong Light TruckNote 3: Calculated based on Business travel- land, UK Government GHG Conversion Factors for Company Reporting
3,940
note1
8.9
note2
2,225
note3
44,495,86110%Using fossilfuels togenerate thesameamount ofelectricity
4,449,586
Equipment/Facility name
Wind turbinesequipped withINOVANCE’selectric pitchsystems
Baseline scenario
Number of new windturbines equipped withINOVANCE’s electricpitch systems andintelligent yaw drives in2023 (unit)
Averageinstalledcapacity of windturbines in 2023(MW)
Average effectiveutilization hours ofwind power in 2023(h)
AnnualCollabora-tivelyavoidedemissions(tCO2e)
Alloca-tionpropor-tion
Collabo-rativelyavoidedemissionsallocated(tCO2e)
12,362,673,400
note1
0.0548
note2
0.1639
note31,348,81010%GHG emis-sions gener-ated byconventionalfuel passen-ger vehiclesdriving thesamemileage
134,881
Equipment/Facility name
Electric passengervehicles equippedwith INOVANCE’sproducts
Baseline scenario
Annual mileage of newenergy vehiclesequipped withINOVANCE’s motorcontroller, motor,e-powertrain andcharging products (km)
Averageemission factorof electricpassengervehicleskgCO2e/km
Average emissionfactor of fuelpassenger vehicleskgCO2e/km
AnnualCollabora-tivelyavoidedemissions(tCO2e)
Alloca-tionpropor-tion
Collabo-rativelyavoidedemissionsallocated(tCO2e)
4,923,250,000
note1
0.2110
note2
0.8231
note3
3,013,46710%GHG emis-sions gener-ated byconventionalfuelcommercialvehiclesdriving thesamemileage
301,347
Equipment/Facility name
Electric commer-cial vehiclesequipped withINOVANCE’sproducts
Baseline scenario
Annual mileage of newenergy vehiclesequipped withINOVANCE’s motorcontroller, motor,e-powertrain andcharging products (km)
Averageemission factorof electricpassengervehicleskgCO2e/km
Average emissionfactor of fuelpassenger vehicleskgCO2e/km
AnnualCollabora-tivelyavoidedemissions(tCO2e)
Alloca-tionpropor-tion
Collabo-rativelyavoidedemissionsallocated(tCO2e)
From the above information, INOVANCE’s Scope 4 avoided emissions in 2023 are summarized as follows:
Directly avoided emissions (tCO2/year) Collaboratively avoided emissions (tCO2/year)Central air conditioner with ACdrive
686,582
1,503,754
18,297
4,449,58699,480
63,930
Air compressor with AC drive
Rail Transit
Wind PowerGeneration
Various equipment/facilitiesequipped with energy-ecientPM motorsVarious equipment/facilitiesequipped with AC drive energyfeedback function
Collaboratively avoided emissions allocated= Number of wind turbines equipped with Inovance's electric pitch systems and intelligent yaw drives* Average installed capacity * Average effective utilisation hours * Average GHG emission factor of power grid* Allocation proportion
Collaboratively avoided emissions allocated= Number of new electric commercial vehicles equipped with Inovance's products in 2023* Average annual mileage of vehicles* (Average emission factor of fuel commercial vehicles - Average emission factor of electric commercial vehicles)* Allocation proportion
Collaboratively avoided emissions allocated= Number of electric passenger vehicles equipped with Inovance's products in 2023* Average annual mileage of passenger vehicles* (Average emission factor of fuel vehicles - Average emission factor of electric passenger vehicles)* Allocation proportion
The calculation results for Scope 4 during the reporting period demonstrate INOVANCE’s ?rst disclosure of theeffect of its products in promoting avoided GHG emissions, and constitute important measures for the Compa-ny to participate in climate change mitigation actions, as well as innovative exploration to improve the qualityof climate-related information disclosure. Due to the impact of data missing and other practical factors, thereis still much room for improvement in the accuracy of our calculation data. In the future, taking the disclosureof Scope 4 as the starting point, we will continue to increase investment in green innovation and serve societywith more, greener products and solutions. Moreover, we will improve the methodology of Scope 4 andenhance the quality of data collection and calculation in synergy with our industrial ecological partners, tomake due contributions to social green and low-carbon transformation with practical actions.
Energy management is one of the key business strategies of INOVANCE. It is not only re?ected in the Compa-ny's internal energy management system building but also characterized by business expansion with digitalenergy management as the core. INOVANCE will continue to optimize the energy consumption structure,strengthen energy-saving management, improve energy eciency, and carry out internal and external energyconservation and emission reduction actions through digitalization.
4.3 Strengthening Energy Management
4.3.1 Optimizing the Structure of Energy Consumption
The Company practices low-carbon operation in every aspect. We continuously optimize our energyconsumption structure and gradually increase the proportion of renewable energy use. During the reportingperiod, the main energy sources used by the Company's staff canteens at the production bases and ocebuildings included natural gas and lique?ed petroleum gas, while the energy sources for production andR&D come from purchased electricity and renewable energy (electricity generated by our photovoltaicfacilities).Yueyang INOVANCE plans to build a green and digital factory, piloting with an integrated power networkcombined with solar system, energy storage system, DC power distribution and ?exible micro grid technolo-gy to achieve ?exible energy dispatch, while increasing the proportion of green electricity use and thereby
Subsidiary INOVANCE Automotive has increased the proportion of green electricity use through various meanssuch as building solar photovoltaic roof, implementing energy saving and consumption reduction in produc-tion, and purchasing green electricity etc. The company pledges to achieve a 50% green electricity use withinthe energy structure by 2024.
Total of Scope 4 avoided GHGemissions
10,748,527
Electric CommercialVehicles
Directly avoided emissions (tCO2/year) Collaboratively avoided emissions (tCO2/year)
134,881
301,347
2,448,320
1,034,308
5,978
2,064
Electric PassengerVehicles
Various injection moldingmachines, die casting machines,bending machines and hydraulicstations equipped with hydraulicservo systems
Other equipment/facilities usingAC drives
Vertical elevators equipped withelevator controllers/drives with anenergy feedback function
NEV vehicles using SiC technology
Total Energy Conservation byequipment upgrade, technologyoptimization and other measures:
1,964,500kWh
Proportion of Clean Energy Use:
3.91%
Total Energy Consumption Intensity:
7.63MWh per million RMB
2023 Key Performance Indicators
Wind Turbine at Yueyang INOVANCE
Notes* estimated energy consumption
4.3.2 Advancing Energy Conservation and Emission Reduction
EnergyConservationProjects
Total EnergyConservationTotal GHGEmissionsReduction
Replacing 220 industrialmining lamps in thewarehouse with 103automatic ad hocradar-sensing LEDlamps
Implementing autosleep, start and stop forequipment such asmonitors, conveyorbelts, ion machines,transmission belts, andsealing machines atSuzhou INOVANCE
Adding air curtains tothe warehouse docks atSuzhou INOVANCE toprevent the loss ofcooling or heatingpower
Intelligent transforma-tion and upgrade of thecentral air conditioningand chilled watersystem in Zone B,Suzhou INOVANCE
Replacing all existingdiesel forklifts withelectric forklifts atSuzhou INOVANCE
120,000 kWh
tonstonstonstonstons
262,500 kWh10,000 kWh1,165,000 kWh* -
68.4149.75.7664.412.9
Optimize Production Process
Rotor Core Cleaning-Free Process:
The MS1 rotor pilot line adopts clean-ing-free process through productionimprovement, while optimizing theprocess to achieve continuous produc-tion of rotors and assembly, and reduc-ing the overall energy consumption ofthe line. This project saved a total of273,600 kWh of electricity this year.
Water-Based Paint ReplacingOil-Based PaintOn the premise of ensuring productperformance and quality, some motorproducts use water-based protectivepaint instead of oil-based paint. Com-pared with using oil-based paint, therequired baking time is signi?cantlyshortened, thereby greatly reducing theenergy consumption of the oven. Afterprocess optimization, 41,300 kWh ofenergy was saved this year. NanjingINOVANCE plans to implement 100%replacement of oil-based paint withwater-based paint for robots, effectivelyreducing VOCs emissions while achiev-ing energy savings.
PCBA Automation Rated IncreasedThe automation of PCBA re?ow solder-ing and DIP process has been increasedto over 80%. 30% of PCBA havecanceled the wave soldering processand achieved full re?ow soldering,signi?cantly reducing energy consump-tion. During the reporting period, 30%of newly-designed PCBA have imple-mented this process.
Introduction of PCB Organic ProtectiveFilm Process
In 2023, the company introduced thePCB Organic Solderability Preservativeprocess, which partially eliminates theupstream supplier's PCB electroplatingprocess and HASL (Hot Air Solder Level-ing), thereby achieving energy conser-vation. During the reporting period,about 10% of new businesses haveimplemented this process.
Digital Energy Management
Energy Digital Management PlatformUpgradeIn 2023, the company managed toconnect the self-developed compre-hensive energy management platformand the Manufacturing ExecutionSystem (MES) system, realizing thecomputing function of single productenergy consumption. This functioncould provide data support for ?neanalysis of energy consumption,explore energy-saving space andaccurate cost accounting. As of theend of the reporting period, theplatform has been able to support thecalculation of single product energyconsumption for motors and low-volt-age AC drives.
Building a Comprehensive EnergyPlatform Based on the User DemandCombining the energy use scenariosfrom the user side, the company hascreated a generation-grid-load-storagecomprehensive energy managementplatform, which not only providesbasic energy-visible managementfunctions but also expands intelligentcontrol systems for typical loads suchas central air conditioners, air com-pressor stations, and elevators. In thefuture, it will also expand to the userbehavior control of air conditionersand lighting, thereby achieving effec-tive management and control, andtruly providing customers withone-stop comprehensive energymanagement and control solutions.
Integrated Energy Management Platform Solution Based on the User Demand
To operate in compliance with laws and regulations, INOVANCE strictly adheres to laws and regulations includ-ing the Environmental Protection Law of the People's Republic of China, the Atmospheric Pollution Preven-tion and Control Law of the People's Republic of China, the Water Pollution Prevention and Control Law of thePeople's Republic of China, the Law of the People's Republic of China on the Prevention and Control ofEnvironmental Pollution by Solid Waste, the Cleaner Production Promotion Law of the People's Republic ofChina, and the EU's Waste Electrical and Electronic Equipment Directive (WEEE).The Company adheres to the environmental management policy of "Green Industrial Control, HarmoniousINOVANCE, Better World." The Safety and Environmental Protection Department leads the implementationand execution of various management measures based on environmental management objectives andpolicies. Internally, the Company has established an environmental management system with reference to ISO14001 and has issued relevant systems such as the INOVANCE EHS "Three Simultaneous" ManagementSystem of Construction Projects, the INOVANCE Waste Gas Emission Management System, the INOVANCEDomestic Sewage Discharge Management System, the INOVANCE Waste Management Procedure, and theINOVANCE Hazardous Waste Management System. During production and operation, the Company strictlycontrols the discharge of wastewater, waste gas, and solid waste, takes corresponding disposal measures toensure clean production, and improves the recycling and reuse of waste, contributing to the environmentallyfriendly society.
4.4 Focusing on Environmental Compliance
Promoting Energy Conservation CultureEnergy-Saving Inspection
To improve the awareness of environmental protection for employees and guide them to develop ener-gy-saving habits, the company routinely carries out special energy-saving inspections. We conductspecial inspections on energy consumption actions in oces and production bases, including but notlimited to computers and monitors that are not automatically turned off, unnecessary light setting tobe always on, conveyor belts idling, equipment and facilities with redundant actions, liquid and gasleakages, unreasonable status of ESD gateways, unreasonable status of temperature control processesetc. The ?ndings of wasted energy will be noti?ed within the company and improvement measures willbe taken immediately.
For more details about energy-saving and carbon reduction management in supply chains, please see 8.1.2Supply Chain ESG Management.
Piloting Green and Low-Carbon FactoryGreen Factory
Yueyang INOVANCE is constructed in accor-dance with the standards of green, low-carbonand digital factory. We have introduced the fulllife cycle carbon emission evaluation mecha-nism of the buildings, improved the greenbuilding level, used centralized cooling withhigh-ecient air-conditions, and fully utilizedindustrial waste heating, which greatly reducesthe full life cycle carbon emissions of the newlybuilt plants. In addition, Yueyang factory tookthe lead in establishing demonstration projectsfor an integrated power network combinedwith solar system, energy storage system, DCpower distribution and ?exible micro grid tech-nology, ?exible energy dispatch system, andindustrial network based on 5G wireless datatransmission.
Yueyang INOVANCE Green and Low-Carbon Pilot Factory
Changzhou New Energy Zero-Carbon Pilot Factory
Zero-Carbon Factory
The subsidiary, INOVANCE Automotive, plans toincrease the proportion of clean energy use,continue to implement lean production toachieve energy saving, process waste heatrecovery, liquid nitrogen heat recovery and wasteresource utilization, and strive to build an indus-try-leading zero-carbon pilot factory by 2025.
Total Investment in EnvironmentalProtection
6.02million RMB
Amount of Environmental ProtectionTraining Duration7,439hoursNumber of EnvironmentalProtection Incident
0times
2023 Key Performance Indicators
4.4.1 Waste Water, Gas and Solid Waste Management
The Company has established a waste water, gas and solid waste management mechanism, with dedicateddata collection and monitoring processes for waste discharge. It collaborates with third-party professionalorganizations to properly dispose of different types of emissions and gradually promotes emission reduction,recycling, and reuse during operations.
In 2023, the Company gradually reduced the emission of hazardous waste gas and wastewater throughimprovements in production processes.Robot Painting Replacement
Nanjing INOVANCE plans to implement 100% replacement of oil-based paint with water-based paint forrobots, effectively reducing VOC emissions. According to internal estimation, after the implementationof this process, it is expected to reduce the use of oil-based paint by approximately 50 tons per year onaverage in the future.Use of Single-component Thermal Interface MaterialSome drive control products of INOVANCE have been optimized to use a single-component thermalinterface material, reducing VOC emissions by decreasing the use of silicone grease. According to inter-nal estimation, this replacement will reduce the use of silicone grease by an average of 0.6 tons per year.Waste Liquid Recycling and Treatment
Nanjing INOVANCE plans to implement waste liquid recycling. The project uses centralized coolinginstead of distributed cooling, and centralizes oil pollution treatment to reduce waste liquid discharge,thereby reducing environmental impact.
Improvements in Production Processe
Promting the Use of Low-silver Solder
In 2023, the Company's electronic process implemented low-silver solder system to reduce the use ofthe precious metal silver. According to internal estimation, after the implementation of this system, itwill cut down the use of silver by more than 2 tons, reducing the consumption of scarce natural resources.My INOVANCEAfter the launch of My INOVANCE, 3,980 product models with approximately 13,000 product manualswere digitized, equivalent to saving 25 tons of paper per year.
Raw Material Reduction
Incoming Material Recycling PackagingAmong the off-site incoming materials from suppliers, 80% of the materials shipped using pallets haveadopted recycled pallets, and 40% of the materials shipped using plastic baskets and iron baskets havealso replaced by recycled packaging. In the process of internal material ?ow, 100% of wooden palletshave been switched to recycled pallets, and 100% of the materials delivered use recycled packaging.Returnable PackagingThe Company adopts returnable packaging for nearby customers with large supply volumes, involvingproducts such as NEV electronic control, motors, powertrains, elevator controllers, and AC drives.
Packaging Material Recycling
INOVANCE adheres to the philosophy of a circular economy and implements measures such as "energy conser-vation, material conservation and eciency enhancement" to enhance resource utilization eciency, achieveresource recycling, and promote sustainable economic growth. The company focuses on raw materials, pack-aging, solid waste, and high-value key components, and adopts substitution, reduction, recycling, and reuse asimplementation pathways to gradually pilot and promote solutions with optimal economic and environmen-tal effects.
4.5 Enhancing Resource Utilization Eciency
The environmental management systems of the Company and its subsidiaries undergo internal audits annual-ly, and accept external audits based on the ISO 14001:2015. The Company continuously improves its environ-mental management based on the audit results. During the reporting period, 10 key operational sites hasobtained ISO 14001 certi?cation with 5 sites increased compared to the previous year. The reason for theincrease is that the newly-added operational sites have passed the certi?cation for the ?rst time. Up to now,the proportion of key operational sites that have obtained ISO 14001 certi?cation is 83%.
4.4.2 Environmental Management System Certi?cation
Emission TypeCollection and Monitoring ProcessDisposal Method
Examples of Reduction,Recycling and ReuseDomestic Sewage
Waste Gas fromProductionGeneral IndustrialSolid WasteHazardous Waste
Conduct regular sampling andmonitoring every year
Sewage is collected throughmunicipal pipelines andtransported to municipalsewage treatment plants fordisposal.
We promote water conservationat oces and factories to reducethe discharge of domesticsewageUse close pipeline for collection,conduct regular testing everyyear, and discharge inaccordance with standards
Waste gas is disposed of throughwaste gas treatment facilities,such as high-ecient ?ltration ofdust and adsorption of VOCswaste gas using activatedcarbon.
We use water-based cleaningagents instead of solvent-basedcleaning agents, and solvent-freeimpregnating varnishes insteadof solvent-based impregnatingvarnishes to reduce VOCemissions.Collected from workshops andtransported to general industrialsolid waste warehouses
Solid waste is entrusted toinstitutions with quali?cation toconduct general industrial solidwaste disposal.
We reuse packaging in someproduct shipments.Collected from workshops tohazardous waste warehouses,classi?ed and stored
Hazardous waste is entrusted toinstitutions with quali?cation toconduct compliant hazardouswaste disposal
We purify and recycle cleaningwastewater through processimprovements
Packaging Material Substitution, Reduction, and Recycling
Use of Reclaimed WoodThe wood used in the Company's packaging is secondary reclaimed wood, and part of the plywood is engineered wood.Any packaging needs solid wood, we will use recycled wood to replace, practicing environmental protection. In addition,we have added about 8% recycled paper to the corrugated paper packaging of our products, and the proportion ofrecycled materials added to EPE foam auxiliary materials is about 15%. During the reporting period, the total amount ofsecondary reclaimed wood used accounted for approximately 33.33% of the total wood used in product packaging.Application of Advanced Composite Cushioning MaterialIn 2023, the Company actively applied new composite cushioning materials in product packaging. We used honeycombcardboard boxes to replace plastic sheets and piloted and promoted them in the packaging of energy storage products;we used 1.5-2cm honeycomb cardboards to replace 6cm EPE foam, which reduced the volume of a single product by10%, effectively reducing the packaging volume and thus reducing the resource consumption required for transportationand storage.Cardboard Boxes Replace Wooden BoxesSince 2023, except for some products that cannot be packaged in cardboard boxes due to speci?c reasons, all otherproduct packaging designs of the company use heavy-duty cardboard boxes and honeycomb cardboard boxes, with a100% utilization of cardboard packaging design. During the reporting period, the company reduced the use of wood byapproximately 200 tons through the replacement.Plastic Pallets Replace Wooden PalletsLeverage the advantages of plastic pallets features such as moisture-proof, anti-corrosion, oil-resistance, and durability, aswell as convenience for recycling and reuse, in 2023 the Company used 19,200 plastic pallets to replace 38,400 woodenpallets in the packaging for incoming materials and at new factories.
Delay Management SystemThe Company's lean management strategy aims to comprehensively improve the utilization of resources such as siteequipment, production lines, and manpower, and reduce resource waste. In 2023, the company improved working hourdelays through the delay management system, reducing delayed working hours by 42,000 hours, improving productionand delivery eciency, and achieving continuous organizational improvement and value creation.
DTL Mode ApplicationThe DTL (Direct-to-Line) mode enables materials to be exempted from testing and unpacking, and they are directlydelivered to the line-side warehouse in batches according to work orders and shifts, and then directly connected to thedelivery by AGV. The promotion of this solution reduces the area required for warehouse usage and improves inventoryturnover rate.Milk Run Mode Application
The Company has been practicing the Milk Run mode since 2022 and has developed multiple routes covering more than10 suppliers. The application of the Milk Run mode effectively reduces logistics costs and avoids GHG emissions caused bypart of upstream materials during transportation.
Recycling of Water ResourcesRainwater Collection and Reuse
Yueyang INOVANCE has established rainwater collection ponds with volumes of 100m? and 180m? respectively. Afterbeing ?ltered and treated in the collection ponds, rainwater will be used for plant irrigation in the factory. During thereporting period, the rainwater collection volume in the factory has reached 21,800 tons.
Recycling of Chilled Water in Air Conditioning Systems
In 2023, the Company continued to implement measures for recycling chilled water in central air conditioning systems atSuzhou INOVANCE, a major subsidiary in terms of water resource consumption. This project has achieved 89.69% industri-al water recycled in the ABC Zones of the Suzhou factory, equivalent to saving 3,111,700 tons of fresh water consumption.
Lean Management for Eciency Improvement
FOCUS ON
CUSTOMER SATISFACTION
CHAPTER 5
5.1 Strict Product Quality Control
5.2 Improving Customer Services
INOVANCE strictly adheres to the Product Quality Law of the People's Republic of China, Regulations on theSupervision and Management of Quality and Safety Responsibilities of Industrial Product Production Units,and other relevant laws, regulations, and product standards. With the quality strategy positioning of "focusingon customer satisfaction and pursuing the best in the industry," INOVANCE aims to achieve "zero productsafety issues" and "the same INOVANCE, the same quality." The company has established and perfected azero-defect quality management system and has built a quality culture with the participation of all employees,promoting the establishment of an ecient digital quality platform.
5.1 Strict Product Quality Control
"Customer ?rst" is one of INOVANCE's core values, and the service philosophy of"customer-centric" is deeply rooted in the hearts of INOVANCE people. In 2023,the company focused on customer satisfaction, continuously improving thecustomer experience by providing high-quality products and excellent services,thereby aiding customer success.
Focus on Customer SatisfactionFocus on Customer Satisfaction
INOVANCE Awarded Goldwind Technology's Excellent Supplier AwardIn March 2023, as a long-term strategic partner of GoldwindTechnology, INOVANCE, with its high-quality system andstable performance of batch products, was honored with the"2022 Excellent Quality Award" and "Level 5 Green Supplier"title from Goldwind Technology. INOVANCE actively cooperatedwith the reliability veri?cation of Goldwind Technology’s newproducts such as V12, comprehensively implementing the ?vemajor quality tools: Advanced Product Quality Planning(APQP), Statistical Process Control (SPC), Failure Mode andEffects Analysis (FMEA), Measurement System Analysis (MSA),and Production Part Approval Process (PPAP), thus winningthe trust of wind power customers with high-qualitystandards and ecient services.
INOVANCE places great importance on product safety management, proposing the "dual total, dual safety"concept which ensures the safety of customers' and users' personal safety and property throughout the entiredistribution process and product lifecycle. The company aims to reduce safety issues related to hardware andsoftware use in the design and development phase, and incorporates product safety and quality performanceinto the performance assessments of organizational units and senior executives
. INOVANCE emphasizes the"dual safety" concept in quality management, focusing on the personal and property safety of users, requiringconsideration of hardware and software safety in product design and development, and integrating productsafety issues into performance evaluations. Additionally, in alignment with the EU’s RoHS and REACH direc-tives, the company has enhanced its management of hazardous substances throughout the entire process.As of the end of the reporting period, there have been no recalls of sold products due to safety or health issues,and all product lines are 100% compliant with RoHS requirements.
1 In this report, "senior executives" refers to the ?rst-tier organizational leaders, including heads of primary departments, business units, and subsidiary companies,unless otherwise speci?ed.
5.1.1 Product Safety Management
In 2023, the company integrated APQP and IPD during the product development stage, adopting automotivequality management ideas, tools, and methods to enhance the quality of industrial products. In the manufac-turing phase, the company continually strengthened control over all quality elements, implementing intelli-gent and digital transformations at manufacturing bases to strive toward the strategic goal of "the sameINOVANCE, the same quality." During the reporting period, there were no product recalls due to legal or regula-tory requirements or demands from governing authorities, and no major product quality disputes occurred.
5.1.2 Product Lifecycle Quality Management
Product Safety and Quality Management at Different Life Stages
Timely closure rate of customer issues
93%
Quality training coverage ratefor front-line employees
100%
Customer quality audit pass rate
100%
2023 Key Performance Indicators
StageQuality Control InitiativesContinuous Improvement Initiatives
ProductDevelopment
?Integrates APQP and IPD, applying automotive qualitymanagement philosophies, tools, and methods to industrialproduct development to enhance the quality of new industrialproducts.?Ensures that the product development stage meets regulatoryand other product safety standards, sets dual safety red lines, andenhances product-related safety requirements.?Conducts quality reviews at various stages of research anddevelopment to ensure the success rate and eciency of productdesign and development.
?The Solid Foundation Team speci?cally addresses thedesign issues identi?ed in the previous year.?The NPI Quality organization strengthens qualitymanagement during the new product introduction process.?Promotes product quality improvements from the sourcethrough design enhancements.
MaterialProcurement
?Categorically and hierarchically carries out supplier introductionand quality management work, extending quality requirementsto multi-tier suppliers.?Conducts incoming inspection activities for different suppliers,including regular inspection, external inspection, exemption, andstringent inspection.
?The SQE group conducts supplier quality assessments,evaluating supplier materials, quality services, 8D processes,and unauthorized changes.? Organizes special improvement competitions andreporting meetings for suppliers.
2022 Excellent Quality Award Certi?cate
INOVANCE has established an all-process quality control system for suppliers, integrating the ISO 9001 qualitymanagement system standards. Through regular internal assessments and both online and oine audits, thecompany strictly controls the quality of its suppliers. INOVANCE manages suppliers by categorizing and gradingthem based on their technology, quality, responsiveness, delivery, and cost (TQRDC), providing improvementplans for non-compliant suppliers and establishing a mechanism for their elimination, all aimed at enhancingthe overall quality level of suppliers.
5.1.3 Supplier Quality Management
Every year, INOVANCE conducts internal audits and third-party supervisory audits for quality management inaccordance with ISO 9001 standards, customer requirements, and industry standards to identify areas forquality improvement and ensure products meet customer quality management requirements. As of the endof the reporting period, INOVANCE has undergone 107 customer quality audits and achieved a 100% auditpass rate. In 2023, 87% of the company's signi?cant operational sites have passed the ISO 9001 certi?cation,with the remaining new key operational sites planning to undertake this certi?cation.
5.1.4 Quality Management Audit
INOVANCE values the development of a quality culture by strengthening quality responsibilities, agile improve-ments, cultural dissemination, and quality training to foster an environment where all employees participatein quality culture.
5.1.5 Quality Culture Development and Training
New Supplier Admission Audit
The company follows the New Supplier Audit Process and Management Standards for guiding newsupplier admissions, requiring all new suppliers to pass the ISO 9001 quality management system. Newsuppliers are assessed in several dimensions including sustainable development, quality system maturi-ty, environmental and safety standards, quality organization and personnel capabilities, process qualitymanagement, customer service, and reliability assurance capabilities. Future new supplier audits willinclude additional assessments on operational risk/key person insights, mold management, and trace-ability.
Supplier Material Quality Management
INOVANCE has established a comprehensive incoming material quality management system, includingIncoming Inspection Procedures,Risk Purchase Material Inspection Management Standards,MaterialReliability Management Standards, and Incoming Material RoHS Management System.The company applies differentiated quality management strategies based on the category and gradeof materials. For key materials, the company conducts proactive quality risk management andstrengthens control over special characteristics of materials, with plans to enhance quality gradingmanagement. For general materials, the company implements a survival-of-the-?ttest strategy to inter-
Supplier Quality Performance Management
INOVANCE has issued several documents internally, including Industrial Supplier Quality PerformanceManagement Standards,Full Supply Chain Supplier Quality Management System, and Tier-2 SupplierQuality Management Standards, to manage suppliers of different types and levels. The companyconducts monthly quality assessments of suppliers, which include evaluations of incoming materialacceptance rate (LAR), defects per million opportunities (DPPM), quality service, market complaints,and 8D, with positive and negative scoring items. Suppliers are rated as excellent, good, poor, ordisquali?ed. Beyond tier-1 suppliers, the company clearly communicates customer requirements, qual-ity standards, and quality goals to multi-tier suppliers and collaborates with tier-1 suppliers to imple-ment quality management for multi-tier suppliers, requiring direct suppliers and key material sub-sup-pliers to sign Quality Agreements and Change Management Agreements. Quality audits are conduct-ed to monitor process yield and review improvements. During the reporting period, the company com-pleted quality assessments for 256 active suppliers, achieving a 28% reduction in production batchrework due to material quality issues.
Supplier Performance Improvement and Coaching
For suppliers that fail assessments, the company tracks and ensures the effective implementation ofcorrective measures to achieve closed-loop management of supplier quality issues. If quality improve-ments do not meet expectations, measures such as adjusting purchasing quotas, code eliminations, orsupplier eliminations are taken to avoid quality issues. Simultaneously, the company emphasizes thedissemination of supplier quality requirements, conducts monthly quality training and coaching forsuppliers, and regularly holds supplier quality conferences to align suppliers with the company's qualitystrategy, control points, and goals.
StageQuality Control InitiativesContinuous Improvement Initiatives
Manufacturing
?Promotes intelligent and digital transformation at multiple sites,advances MES development, and ensures precise traceability fromraw materials to ?nished products and from suppliers to custom-ers, maintaining production quality consistency and gradualimprovement.?Tests all products 100% during the manufacturing process.?Implements comprehensive control over all factors in themanufacturing process, including personnel, machinery, materials,methods, and environment.
?The QCC improvement team continuously addresses andtracks quality issues during production.?Establishes a lean improvement organization to drivere?ned management of the manufacturing environmentand achieve a zero defect rate.?Provides training and empowerment to quality personnel,regularly organizes quality conferences and award-reportingevents to enhance motivation for improvements.
Market Service
?Focuses on customer satisfaction, upgrades joint warranty spareparts services, and establishes an international technical servicecenter.?Sets up professional after-sales customer service and qualitycomplaint interfaces, providing professional and timely technicalsupport to customers.?The after-sales quality department analyzes quality issues andfollows up on them until they are resolved.
?Integrates ITR operations and transformations to strengthenthe tiered management of after-sales quality issues, enhanc-ing the eciency and thoroughness of solutions.?Strengthens CQM at the customer end to target andenhance management effectiveness.
cept and eliminate non-compliant materials. Additionally, the company has implemented the Compo-nent PPAP Process, requiring suppliers to pass the component PPAP certi?cation to better meetcustomer quality requirements.
Quality CultureDevelopmentand Training
Strengthening Quality ResponsibilitiesAgile Quality Improvements
Deepening Quality Training
Diverse Cultural Dissemination
The company has clari?ed quality rewardsand penalties, quality red lines, and thequality responsibility management systemfor cadres. In 2023, the company clearlyidenti?ed core job quality responsibilitiesand strengthened the quali?cations forthose positions in terms of quality manage-ment, specifying the veto and accountabili-ty rights of quality leadership cadres.
The company organizes Quality ControlCircles (QCC) to identify core con?icts andfocus on quickly effective quality improve-ment plans, encouraging front-line employ-ee participation and making rapid improve-ments from small starts.
The company organizes regular weeklyquality training for production front-lineworkers by production quality engineers.During the reporting period, the qualitytraining coverage for production front-lineworkers reached 100%. This year, the com-pany conducted quality system and tooltraining as well as specialized quality train-ing for 478 core marketing personnel and800 core R&D, production, sales, and servicestaff members.
This year, the company organized thesecond Quality Conference, which wasattended by directors and higher manage-ment. The conference focused on customersatisfaction, disseminated quality concepts,and aimed to create a culture of qualityinvolvement for everyone. Alongside the"Quality Month" activities, the company held"510" and "910" quality knowledge competi-tions this year, inviting all employees toparticipate in tests on quality processes,tools, and methods, with a participation of7,835 people. Additionally, the companymotivated employees to participate inquality building through awards such as theHall of Fame Quality Award, Quality Pioneer,and Production Process Quality Award, andby promoting quality ?gures and stories.This year, the company organized 8 semi-nars related to quality culture.
INOVANCE consistently adheres to a customer-centric approach, upholding the core value of "Customer ?rst"and fully practicing the philosophy of "making customers more satis?ed and operations more ecient."Customer satisfaction is regarded as the goal of our efforts, continuously optimizing and improving thecustomer service management system, enhancing customer experience and satisfaction, committed toachieving customer value, and helping customers succeed.
5.2 Improving Customer Services
To implement the company's "Step Towards globalization" strategy and fully promote the GLOCAL (global-lo-cal) model, the company continues to develop a more comprehensive, professional, and convenient customerservice network. During the reporting period, we have continuously expanded the coverage of our customerservice network, improved the quality of customer service, and enriched and optimized customer servicechannels to enhance the quality and level of global customer service.
5.2.1 Customer Service Management System
More Professional Service Team
The company has established a customer service team that includes INOVANCE employees, jointwarranty centers, and Certi?ed outsourcing engineers. In 2023, the Technical service center responsiblefor customer service was elevated to a ?rst-level department within the company. To accommodate theuniform high standards of customer service and the consumption and usage habits of overseascustomers, we established an overseas service department in 2023, equipped with 49 service engineers,including 35 local engineers and 9 engineers who can be dispatched overseas. We have also translatedplatform documentation, process rules, and other documents to facilitate team collaboration andimprove information transmission and communication eciency. In 2023, two translated platformdocuments or rule documents were approved after review.In terms of customer service quality, to continuously improve the level of customer service and enhancethe capabilities and technical levels of the customer service team, we conducted specialized skill train-ing for customer service personnel. In 2023, a total of 312 training sessions were organized, with morethan 7,200 participants in total.Additionally, during the reporting period, we established a "Partner Management Department" as athird-level department under the Technical Service Center to manage partners and third parties, ensuringthat customers receive consistent, high-quality service.
More Comprehensive Service NetworkThe company continues to enhance the coverage of the customer service network, providing morecomprehensive and timely service and support to global customers. Additionally, we have established16 renovation and operation service "model sites" in China to provide high-quality technical support tocustomers. To better meet the needs of customers speaking different languages, we have been activelypreparing various local language materials and started using AI engines for multilingual translationfrom this year onwards. By the end of 2023, we have completed the model training for English andinitiated the development of models for other languages like Korean.
We are actively exploring diverse customer service channels, integratingintelligent customer service, and launching a one-stop service platform—the"My INOVANCE APP," continuously improving service eciency and quality,optimizing customer experience.400 Customer Service Hotline?Provides year-round technical servicesupport. In 2023, the hotline received 276,000 calls, of which 147,000 wereprocessed.Intelligent Customer ServiceIntroduced AI technology, launching an "Intel-
ligent Customer Service" robot. Throughout 2023, the intelligent customerservice had 156,000 effective sessions; combined with the 400 hotline, thetotal effective acceptance reached 303,000 cases, with a problem resolutionrate of 95.8%.My INOVANCE APPLaunched three major service sections: "Self-Service,"
"Equipment Lifecycle Services," and "Customized Service Solutions," creatinga one-stop service platform that integrates online ordering, oine service,rapid response, and professional eciency. By the end of the reporting period,the My INOVANCE APP registered 20,000 users, with 650,000 user visits and100,000 document viewings.
More Diverse Service Channels
ServiceMall Interface
ProductIntroduction Interface
Product SelectionComparison Interface
ExchangeCommunity Interface
My INOVANCE APP — Putting Products and Services in Your Pocket
In 2023, INOVANCE launched its ocial product information and service platform—the My INOVANCEAPP—to provide customers with one-stop information and services, streamlining ecient servicescenarios for INOVANCE and solving customer pain points. It also creates a knowledge exchange com-munity, connecting talent across the industry. Main features of the My INOVANCE APP include:
Domestic Customer Service Network
?3 repair centers?414 joint warranty?5 regional spare parts centers
As of the end of2023, there are422 servicesites estab-lished in China,including
International Customer Service Network
As of the end of2023, there are
31 service
sites estab-lished overseas,including
?9 INOVANCE subsidiaries and oceslocated in South Korea, Vietnam, Malaysia,India, Turkey, Germany, Spain, Italy, and France?2 repair centers located in India and Turkey?16 joint warranty centers located in HongKong China, Taiwan China, Japan, Vietnam (3centers), Philippines, Thailand, Indonesia,Myanmar, Malaysia, Bangladesh, Turkey, Mexico,Colombia, and Brazil?4 spare parts centers located in Spain, Turkey,India, and Vietnam
400 CustomerService Hotline
were processed
147,000
IntelligentCustomer Service
95.8%
with a problemresolution rate
650,000
user visits
Product Information andIntroduction Videos
Provides one-stop, complete,accurate and up-to-dateproduct information, aone-stop information lookup;100% of the productscirculating in the market havetheir data uploaded, 3,980products have achieved zeropaper usage, and 13,000product manuals have beenuploaded, virtually replacingpaper; information transmis-sion is accurate; updates aretimely. Makes product manualsand documentation visual,helping customers to under-stand intuitively, enhancingcustomer experience.
Product Selection andIntelligent Comparison
Complete product selection inthree simple steps, with adetailed comparison of productparameters to assist customerdecision-making.Knowledge Interaction andExchange CommunityConnects industrial talent,creating a platform for knowledgesharing, interaction, exchange,and learning, helping customersgrow.
Service MallProvides customers with onlineand oine one-stop profession-al services, quickly respondingto customer needs. Serviceorders are controllable andmanageable, linking ordercreation, enhancingoperational and customerservice eciency, and furtherimproving customersatisfaction. Initially launchedwith on-site technical services(including fault handling andinstallation services) and spareparts services (includingemergency and shared spareparts services).
Customer Satisfaction Survey
The company places high importance on customer satisfaction and regularly conducts service satisfactionsurveys using its internal systems. This includes monthly invitations for sales, expansion, and service personnelfrom sales & services departments to provide feedback on the service received during the month; quarterlyservice satisfaction surveys distributed to all sales and expansion personnel and selected staff from the Digitali-zation Business Division; and initiating "Dissatisfaction Case Feedback" on the OA system, with dedicatedpersonnel to review the cases of dissatisfaction.To better implement the business principle of "higher customer satisfaction and more ecient operations" andto effectively ensure customer satisfaction, the company's quality transformation in 2023 revolves around qual-ity building and ITR transformation to continuously optimize quality management measures. This year, withcustomer satisfaction as the core, the company introduced third-party customer satisfaction surveys to identifyand continuously improve on top-priority projects. INOVANCE hired the globally leading customer insights andstrategic consulting ?rm Ipsos to conduct third-party customer satisfaction surveys across all business areas,including general automation, elevators, and robotics, collecting over 2,700 valid opinions and suggestions. Thesurvey results show that the company's customer satisfaction ranks at the leading level among the domesticIndustry. As the ?rst Chinese company in industry automation business to introduce third-party customersatisfaction surveys, the company analyzes and identi?es key focus areas and drivers of customer satisfactionfrom the reports, sets up speci?c improvement projects for existing issues, optimizes processes and systems,and continually enhances its capability to serve customers.Customer Complaints and ResolutionThe company has established an ecient handling process from problem to resolution (ITR) based on theQuality Correction Process and other institutional documents, employing a tiered and categorized handlingmechanism that involves service personnel, expansion personnel, and R&D design personnel. This systemensures timely responses to customer complaints, promotes rapid resolution of feedback, minimizes the nega-tive impact of issues, and supports continuous improvement of product quality. In 2023, the timely closure ratefor customer issues reached 93%. By the end of the reporting period, the company received 5 customer com-plaint letters, all of which were resolved promptly with a 100% timely resolution rate.Customer Privacy ProtectionINOVANCE strictly protects customer privacy, establishing rigorous access management and committing tocollect, access, use, or disclose personal data only with the customer's explicit consent and for legitimate,appropriate business purposes. During collaborations with customers, the company strictly adheres to thecustomer's regulations and policies, always protecting the customer's assets, including commercial secrets,intellectual property, process technology, and information assets. Throughout the reporting period, there wereno incidents of customer privacy or information leakage.
5.2.2 Customer Satisfaction Management
5.2.3 Responsible Marketing
The company strictly adheres to the Advertising Law of the People's Republic of China, the Trademark Law ofthe People's Republic of China,and other national laws and regulations, as well as industry-speci?c rules, toconduct responsible marketing management. Through the product user manuals inside the packaging, MyINOVANCE APP, company website, and ocial WeChat public account, we provide customers with truthful,accurate, effective, and easy-to-understand information about product features, usage eciency, potentialrisks, safety instructions, and operation and maintenance methods.During the reporting period, there were no incidents of penalties from regulatory authorities for violationsrelated to product and service marketing, information and labeling laws, regulations, or other voluntary regulations.Product Information Management?Established an information design process covering all products, clarifying key activities and
standard requirements involved throughout the product lifecycle.?Project team engineers provide product information materials and organize peer reviews for allkey activities.?During the product development phase, the testing department conducts third-party tests, and
marketing representatives handle the acceptance delivery.?A product information change process is implemented to ensure timely updates of product
information.
Communication Channel Development
?My INOVANCE APP provides textual and visual documentation for all products circulating on the
market by INOVANCE, with added introduction videos; customers can use the APP for one-stop
rapid product selection and comparative decision support through product parameter compari-
sons.?A "Product Center" is set up on the company website and WeChat public account to describe
different products’ features and speci?cations; it provides related certi?cates, drawings, manuals,
videos, and ensures automatic updates of website product data.?Actively provides customized information about the company’s products and services through
emerging channels such as online live streaming platforms, online summits, WeChat video
accounts, and DOUYIN.
Supportive Service Provision
?Offers training related to product selection, installation, commissioning, and maintenance for all
product lines to customers, including training courses, videos, and documentation.?Provides tiered and categorized management and professional training courses for customers
and channel partners, enhancing the ecosystem's understanding and capability to use products.?My INOVANCE APP creates a learning and exchange community for industrial control industry
talent, providing a one-stop platform for knowledge sharing, interactive exchange, and learning,
helping industry users grow faster and supporting customer success.
INNOVATION
DRIVES DEVELOPMENT
CHAPTER 6
6.1 R&D Innovation Focus
6.2 Data Privacy Protection
Innovation is the driving force and booster for enterprise development. INO-VANCE always adheres to independent innovation, focusing on the researchand development of industrial automation products, providing customers withmore intelligent, precise, and cutting-edge comprehensive products and solu-tions using advanced technology and industry experience. Additionally, withthe development of the industrial internet, the company places high impor-tance on information security and IT security to effectively protect the data andprivacy of all stakeholders in the ecosystem.
Innovation Drives DevelopmentInnovation Drives Development
6.1.1 Stimulate Innovation Vitality
INOVANCE fully recognizes that R&D innovation is crucial for maintaining a competitive edge and achievingsustainable growth. The company continues to maintain a high ratio of R&D investment, establishes effectiveinnovation incentive mechanisms, and actively collaborates with the industry ecosystem to provide high-quali-ty R&D support for products and solutions.
R&D InvestmentThe company continuously increases its R&D investment, forms excellent R&D teams, and sets up R&D centersglobally to enhance its R&D capabilities, ensuring its products and service solutions remain technologicallyadvanced and meet customers' innovation needs. Globally, INOVANCE has established 6 major R&D centers inShenzhen, Suzhou, Xi'an, Nanjing, Milan (Italy), and Stuttgart (Germany), integrating global resources, gather-ing diverse innovative intelligence, leveraging regional technological advantages, and creating a complemen-tary R&D layout. As of the end of the reporting period, the company's R&D investment reached RMB 2.624billion, accounting for 8.63% of the total operating revenue; R&D personnel totaled 5,482, representing 23.15%of the total workforce.
20192020202120222023
R&D Investment Number of R&D Personnel Proportion of R&D Investment Proportion of R&D Personnel
1,0001,5002,0002,5003,0006,000
5,000
22.409%
11.58%
8.89%
9.39%
9.69%
8.63%
19.53%
21.02%
23.66%
23.15%
4,0003,0002,0001,000
R&D Investment, million RMBR&D Personnel
2023 New Products Released: VA71 series OCR Intelligent Camera2023 New Products Released:
IR-R220 series SCARA Robots with maximium load 220kg
As a company that values technology, products, and solutions, INOVANCE places great emphasis on R&D inno-vation and considers technological innovation as the primary driving force for the company's development. Itis committed to continuously creating value for customers by providing innovative solutions and services,helping them achieve business success. The company strictly adheres to scienti?c ethical standards andfollows prudent and robust principles in its R&D activities, strictly prohibiting any research and business prac-tices that infringe on individual rights or harm public interests.
6.1 R&D Innovation Focus
R&D InvestmentRMB
2.624billion
Proportion of R&DInvestment
8.63%
Proportion of R&DPersonnel
5,482
Proportion ofInnovation Personnel
23.15%
Number of NewPatent Applications
Number of NewPatents Granted
2023 Key Performance Indicators
Innovation Incentive MechanismsTo stimulate employee innovation and deepen the corporate culture of innovation, the company has estab-lished multiple internal innovation awards and recognizes outstanding individuals and experts. Technicalawards set up by the company include the Highest Technology Award, Major Technological BreakthroughAward, and Major External Technology Cooperation Award, among others. For innovative achievements thatare not immediately recognized, the company also has a retrospective innovation reward mechanism toensure fair and accurate implementation of innovation incentives. In 2023, the company awarded 19 compa-ny-level technical awards.Furthermore, to support R&D personnel in conducting technological innovation and research more conve-niently, the company has separated technology development from product development, with independentinvestment, processes, and decision-making for technology development.
Open Innovation CooperationINOVANCE continuously focuses on and learns from cutting-edge technologies and innovative research in theindustry, actively collaborating with customers, suppliers, partners, and universities. For innovation exchange,the company periodically hosts innovation seminars and round-table discussions, inviting university andindustry experts to explore new ?elds, technological directions, and trends. Internal senior R&D experts regu-larly participate in external exchanges with industry associations and universities to gain insights into thelatest technologies and integrate these insights into R&D business planning, applying innovative results incommercial products and services. In terms of technical cooperation, the company co-creates with corecustomers, establishes joint laboratories with suppliers, partners, and universities, and conducts researchprojects with several domestic universities. During the reporting period, the company participated in theformulation of 4 national standards.
National Standards Formulated by INOVANCE in 2023:
R&D Innovation Honors and Awards
German Design AssociationGerman Design Association
German Red Dot Award—INO-lMCS Injection Moulding Control System
German Red Dot Award—INOVANCE - Fast Troubleshooting Service for Industrial Equipment
German iF Design Award—INOHOME - FAST TROUBLESHOOTINGHanover Industrial Design Forum, Germany
German iF Design Award—CNC CONTROL SYSTEM MTC800Hanover Industrial Design Forum, Germany
German iF Design Award
—INOTOUCHPADHanover Industrial Design Forum, Germany
2023 Forbes China Top 50Innovative CompaniesForbes China
2023 Global Future 50
Fortune Magazine
2023 Elevator Parts Annual
Innovation ProductChina Elevator Magazinet
Speci?cations for Improving the Safety of In-use Elevators (GB/T 24804-2023)Technical Speci?cations for Elevator IoT Monitoring Terminals (GB/T 42616-2023)Safety Assessment Speci?cations for In-use Elevators (GB/T 42615-2023)Con?guration and Selection of Passenger Elevators Installed in Of?ce, Hotel, and ResidentialBuildings (GB/T 42623-2023)
6.1.2 Optimize R&D System
INOVANCE views its mission and vision for the R&D system as "empowering various industries with leadingautomation technology, communication technology, and the integration of digital and intelligent technolo-gies through AI & IoT." The company has constructed a comprehensive R&D innovation system focused on"technology research, platform product development, and customized product development." It adopts anIntegrated Product Development (IPD) model for R&D, based on external environmental factors, corporatestrategy, customer needs, technological advancements, and market competition for technology reserves andproduct development.
R&D System Support
6.1.3 Protect Intellectual Property
The company strictly adheres to the Patent Law of the People's Republic of China, the Trademark Law of thePeople's Republic of China, the Copyright Law of the People's Republic of China, and other relevant laws andregulations. It has developed and established a complete system of policies, including the INOVANCE Intellec-tual Property Management Manual,Management Procedures for Risks of Intellectual Property,ManagementProcedures for Resolution of Disputes on Intellectual Property, and Incentive Procedures for IntellectualProperty. A Patent Committee works in coordination with the Intellectual Property and Legal Departments tosystematically carry out the creation, protection, utilization, and management of patents.In terms of protecting its own intellectual property, the company conducts patent layouts for its projects,arranging for patent engineers and R&D personnel to jointly discuss the innovative aspects of projects. Bothparties participate in patent layout, patent risk, and patent proposal reviews to determine the patents thatshould be applied for. Additionally, by preparing industry patent analysis reports or competitor patent analysisreports, the company enhances R&D personnel's understanding of the current state of intellectual property inthe industry, urging them to promptly report research results and ?le for intellectual property rights. Further-more, the company rewards patent applications, patent grants, and patent implementations according to the"Intellectual Property Incentive Program" to motivate employees to actively participate in invention and ?le forintellectual property rights. The subsidiary INOVANCE Automotive has passed the third-party audit for theEnterprise Intellectual Property Management Norm (GB/T 29490-2013) and obtained a certi?cation for itsintellectual property management system.
As of the end of 2023, the company has accumulated a total of 2,679 granted patents, including 412 inventionpatents and 24 overseas patents. Throughout 2023, the company ?led 982 new patent applications and 43new copyright applications; it received 506 new patent grants and 61 new copyright approvals.INOVANCE respects and protects the intellectual property of others, establishing corresponding intellectualproperty management systems internally to ensure compliance with laws and regulations. The companyrespects industry norms, and conducts intellectual property searches and checks to avoid infringement risksbefore undertaking procurement, ?nancing, and overseas market expansion activities. Moreover, the companyalso engages in patent and trademark rights enforcement, vigorously combating counterfeit and imitationpractices in the market. During the reporting period, the company did not face any penalties from regulatoryauthorities for violating intellectual property laws and regulations.To continuously enhance the awareness of intellectual property protection among all employees, the companyconducts intellectual property education during daily operations and regularly holds intellectual propertyprotection training sessions.
*Note: In 2022, Suzhou INOVANCE passed the third-party audit for the Enterprise Intellectual Property Management Norm (GB/T 29490-2013) and obtained a certi?ca-tion for its intellectual property management system.
6.2 Data Privacy Protection
The company strictly adheres to the Data Security Law of the People's Republic of China, the Network Securi-ty Law of the People's Republic of China, the Personal Information Protection Law of the People's Republic ofChina, the GDPR of the European Union, and other legal and regulatory requirements of the locations whereit operates and its partners are based. It prudently ful?lls its responsibilities and obligations regarding thesecurity and privacy of its own and its customers' data, collecting and using personal information based on theprinciples of legality, legitimacy, and necessity.
6.2.1 Information Security Management
TechnologyResearch
? Conducts technology research and preliminary studies to keep up with internationalleading technologies and address key technological gaps.? Performs forward-looking research on critical components to build core competitiveness.? Deeply develops innovative green and low-carbon technologies focusing on lightweight,miniaturization, and reduced environmental impact.
Platform ProductDevelopmentCustomizedProductDevelopment
? Develops high-performance, highly reliable, and low-cost standardized platformproducts to provide comprehensive product solutions to customers.? Combines digital and intelligent technologies to develop model-driven platform products.? Focuses on the development of customized products, offering innovative customizedsolutions to customers from various industries.? Establishes customer solution development and equipment competitiveness develop-ment processes, seamlessly integrating technology research, platform development,and solution development throughout the entire cycle.
Invention Patents
Overseas Patents
New CopyrightApplications
Patents Granted
Copyrights Approved
2,679 Total Patents Granted982 New Patent Applications
Key Performance Highlights for 2023
Major informationSecurity Incidents
0times
Company-wide Pass Rate for the "Information Securityand Legal Regulations and Requirements" Exam
100%
Information Security Strategy ObjectivesINOVANCE and its subsidiaries adhere to the principle of "one network, one security strategy." Based onthe information security management principles such as client interoperability, server-side access, anddiffering regional client and server access, the company sets the baseline goal of avoiding signi?cant infor-mation security incidents. It continuously builds and enhances the information security managementsystem based on ISO/IEC 27001:2013.Information Security Management Structure
The company’s information security is coordinated by the Intellectual Property and Legal Center, workingin collaboration with various business departments to build a comprehensive information security defensenetwork. Each business department appoints an information security ocer to assist in the promotionand implementation of the company's information security management efforts.INOVANCE has established a four-tier information security organizational structure internally. Businessheads are the primary responsible parties for information security within their operations, managing infor-mation security assets during business activities; the Information and Security Department is responsiblefor planning the information security control system and auditing, with internal information security strat-egy and audit groups; the IT Security Department is tasked with implementing and maintaining the com-pany’s information security system, with internal information security operations and defense groups. Keyperformance indicators related to information security such as average time to handle security threats,timely repair rate of security risks, and timely closure rate of security incidents are included in the perfor-mance assessment system of departmental employees; departments collaborate to build and ensure thelegal and regulatory compliance of the company’s information security system.Information Security Management System
The company has established stringent data privacy protection management systems and data collectiondeclaration/permission regulations. It has issued various management standards, including the INOVANCEInformation Security Incident Management Framework, Information Security Violation Cases and Penal-ties, Computer Security Management Standards, Information Security Incident Investigation Proceduresand others. These documents are reviewed annually and revised and updated timely based on the latestapplicable laws and regulations, industry insights, and experiences in handling information securityincidents.During the reporting period, the company reviewed and revised 4 management standard documents:
INOVANCE Information Security Reward and Penalty Regulations, INOVANCE Information SecurityIncident Management Framework, Information Security Violation Cases and Penalties, and WirelessNetwork Construction Safety Management Regulations.
Information Security Management PrinciplesThe company follows the "Three Realms, Two Channels" framework to secure control of INOVANCE’s infor-mation assets, balancing security eciency and service effectiveness. The "Three Realms" refer to thenetwork boundary, physical boundary, and endpoint boundary. All outbound information within thenetwork boundary must undergo compliance reviews, and internal core secrets are strictly protected.Within the physical boundary, the entry and exit of storage media are strictly controlled to prevent majorinformation leakage incidents. The endpoint boundary is divided into internal and external endpoints;external endpoints, after legal and regulatory review, need to be uniformly managed within the domainwhen connected to the company’s network, and information assets within internal endpoints must notleave the company’s endpoints without permission. The "Two Channels" refer to the company's designatedapplication channels and compliance channels for transmitting information, managing internal con?den-tial data, and ensuring the secure transfer of necessary ?les.
Special Projects in Information Security Management
In 2023, INOVANCE undertook a series of special projects to strengthen internal and external informationsecurity capabilities. During the reporting period, the company did not experience any major informationsecurity violations. · Strengthening Information Security Management for Outsourced PersonnelThe Information Security Department established the Outsourced Personnel Information Security Man-agement Standards, specifying information security baseline requirements and integrating these regula-tions into the external personnel entry process. Outsourced suppliers are required to appoint an informa-tion security ocer to coordinate information security tasks during the collaboration, and all outsourcedpersonnel must pass an information security exam, undergo training, and sign a con?dentiality agreementbefore ocially starting work. · Improving Internal Process Data Standard ManagementWe issued the "External Release Security Management Standards for Information Systems," strengtheningthe security management of ?nancial, cost, and payroll data. · Optimizing Classi?cation and Permission Management
Based on the INOVANCE Information Security Management Strategy, different classi?cation levels of docu-ments, con?dentiality duration, and transmission requirements are established for differentiated manage-ment. Departments owning information assets must regularly review the classi?cation levels, and reevalu-ate the classi?cation when the con?dentiality period expires.
· Implementing Regional Network Isolation
Issued the Company Base Wired Network Construction Standards and Company Base Wireless NetworkConstruction Standards, classifying company areas into high, medium, low, and production classi?cationsfor differentiated management.
InformationAssets ofINOVANCE
Endpoint BoundaryNetwork BoundaryPhysical Boundary
Complaint andControlled Informatione-Transmission Channel
Three Realms andTwo Channels
INOVANCE Information Security Control Framework
Complaint andControlled InformationApplication Channel
Information Security Emergency Response Management
INOVANCE conducts violation tracing, evidence solidi?cation, and fact clari?cation based on the Informa-tion Security Incident Management System, responding swiftly to information security incidents throughlawful and technical means until the incident is resolved. The company has set a target time limit for iden-tifying information security incidents, requiring problem identi?cation and resolution closure within 21days of the incident occurrence.Information Security AuditThe company conducts routine information security audits monthly and issues corresponding auditreports. During the reporting period, information security audits covered the Shenzhen headquarters and9 subsidiaries, including Suzhou INOVANCE and BST.Information Security Training"Enhancing awareness, strengthening measures, preventing risks, and securing business" is the company'sinformation security management motto. Information security training and dissemination are importantmeans to enhance company-wide awareness of information security. The company organizes annual infor-mation security training for all employees. INOVANCE's information security training system consists ofnew employee orientation training, regular information security exams, and routine specialized trainingfor information security ocers in various business departments.During the reporting period, the company conducted 2 information security and legal exams covering allemployees
, with a pass rate of 100%; 34 specialized training sessions for information security ocers invarious business departments, with over 2,000 participants. Additionally, the company released theINOVANCE Employee Information Security Handbook, providing detailed guidelines on personnel securi-ty, information asset security, computer security, network security, physical security, oce security, andinformation security operations for outsourced personnel, accompanied by information security rewardsand penalties and case references.
IT Security Strategy ObjectivesThe company has set a baseline objective of no major IT security incidents to ensure business continuity,continuously strengthening and building a "zero trust" IT security protection system. This system authenti-cates user endpoints, network access, and application and data access, and it is subject to ongoing securi-ty monitoring.IT Security Management StructureInternally, the company has established a clearly de?ned IT security management structure. The EMT isresponsible for formulating the company's IT security policies and assessment criteria, with the EMT Directorserving as the highest responsible ocer for IT security. The Process and IT Department undertakes corpo-rate-level IT construction, maintenance, and security, with the IT Security Department responsible for IT
1 Front-line production workers, who do not deal with information security matters, are excluded from reference to all employees here.
6.2.2 IT Safety
Regarding internal vulnerability management, the company requires high-risk vulnerabilities to be ?xedwithin 24 hours and medium-risk vulnerabilities within 72 hours. For IT security incidents, the company inter-nally classi?es incidents based on the number of affected people and the type of business. Users report IT secu-rity issues to the service desk, which then forwards the issues to the IT Security Department for front-line inves-tigation. If a systemic issue arises, the IT Security Department arranges for second-line engineers to handle itspeci?cally. Unresolved security incidents are internally announced and escalated.Based on the urgency, impact, severity, and potential consequences related to production, operations, andmanagement, the company has established four priority levels for IT security incidents:
?Level 1 (Highest): Upon receiving an incident noti?cation, it must be immediately reported to the IT manage-
ment layer. The emergency response team initiates the emergency plan. If the incident is not resolved withinone hour, it is escalated to the company management.?Level 2 (High): Upon receiving an incident noti?cation, the incident is immediately reported to the emergency
response team for handling. If the incident is not resolved within 30 minutes, it is escalated to the IT manage-ment layer.
?Level 3 (Medium): Upon receiving an incident noti?cation, the incident is immediately reported to the emer-
gency response team for handling. If the incident is not resolved within one hour, it is escalated to the IT man-agement layer.
?Level 4 (Low): Upon receiving an incident noti?cation, the incident requires careful analysis and diagnosis
according to internal procedures, and it is managed until resolved.
The company conducts daily IT security management in the following four areas:
Input Professional Insights
Continuously monitors new technologiesand vulnerabilities in the IT ?eld,transforming the latest professionalinsights into internal security baselines.
Manage SecurityVulnerabilitiesDevelops a vulnerability managementstrategy and implementation plan,improving the security vulnerabilitytmanagement process and standards.
Maintain Daily SecurityMonitors daily IT security issues, identi?esproblems, and ensures timely closure;conducts regular IT security internalaudits annually.
Conduct Offensiveand Defensive Drill
Establishes regular offensive anddefensive drills and testing mechanisms,identifying IT security weaknesses andprogressively resolving them.
BitSight Security Score
New Information SecurityEmergency Plans Added
Major IT Security Incidents
0times
Key Performance Highlights for 2023
security construction and maintenance, managing the implementation of IT security policies, accesscontrol, network security, and security audits.
IT Security Management SystemThe company has established an information security management system in accordance with ISO/IEC27001:2013 and has issued IT Service Continuity Management System and IT Business ContinuityPlan,among other system documents, to comprehensively protect the company’s IT security. In 2023, thecompany reviewed and revised these two system documents, adding details on business continuity drills,new fault simulation scenarios, and requirements for fault recovery steps or manuals to provide guidelinesfor business continuity drills and fault recovery. The IT Security Department of the company conducts aninternal audit annually, reviewing compliance with the group's security baseline, and a compliance auditis published externally every 6 months.
Emergency Preparedness and Offensive and Defensive Drills
In 2023, the company conducted one comprehensive IT security emergency drill, covering phishingemails, web page tampering, DDOS attacks, and ARP spoo?ng attacks, enhancing IT personnel's responsecapabilities to external threats and verifying the effectiveness of emergency plans. During the reportingperiod, the company added 6 new IT security emergency plans to supplement and cover commonsecurity issues and management standards.
To enhance the company's practical offensive and defensive capabilities and improve its ability to identi-fy security threats, trace origins, and respond to emergencies, INOVANCE conducted 2 IT security drills in2023. Through these exercises, the company identi?ed and promptly resolved 242 security issues. Addi-tionally, the IT Security Department conducted IT security tests across the entire group, covering allproduction bases and subsidiaries.A third-party information security assessment agency, BitSight, evaluated the security of all the compa-ny’s external-facing systems and internal endpoints. In 2023, the company achieved a BitSight score of760 out of 850, placing it at a leading level within the industry. The subsidiary, INOVANCE Automotive,keeps on enhance its information security continuity, developing comprehensive and detailed businesscontinuity drill plans, and eciently implementing and reviewing these drills. The information securitymanagement system undergoes third-party audits annually. During the reporting period, INOVANCEAutomotive passed the ISO 27001 annual review and completed preparations for the 2024 TISAXre-evaluation ahead of schedule.
Emergency Response Plans
Phishing Attack Emergency Response PlanRansomware Emergency Response PlanWorm Virus Emergency Response PlanWeb Page Tampering Emergency Response PlanDDOS Attack Emergency Response PlanARP Spoo?ng Attack Emergency Response Plan
EMPLOYEE DEVELOPMENT
GUARANTEE
CHAPTER 7
7.1 Employee Rights and Welfare Protection
7.2 Talent Attraction and Retention
7.3 Employee Training and Development
7.4 Occupational Health and Safety
INOVANCE advocates for diversity, equity, and inclusion(DEI), respecting and treating employees of differentgenders, ages, races, nationalities, cultural backgrounds, and physical conditions equally. We believe that adiverse cultural force can inspire creativity in teams. As the company accelerates its overseas business layout,we will enhance DEI construction, building a platform for equal exchange and collaborative creation amongdiverse talents at INOVANCE.Diverse Employee CompositionAdhering to values of equality and diversity, and progressing with the company's international strategy, weemploy local staff in global operations, forming diverse and trustworthy teams. The company values andprotects the legal rights of female employees, providing various bene?ts for women, focusing on their develop-ment and growth within the company, and encouraging all female employees to ful?ll their potential. Forquali?ed persons with disabilities, the company also provides job opportunities and encourages them to utilizetheir abilities in their roles.As of the end of 2023, the company employs 25,487 staff from over 10 countries and regions, with non-Chi-nese-citizen employees making up 1.79%, and minority and/or vulnerable group employees making up 7.91%;female employees constitute 26.19% of the workforce, an increase of 6.55% compared to 2022, with 14.70%female managers, 9.90% of women in STEM-related positions, and 15.00% of women in revenue-generatingpositions. Additionally, in 2023, the company employed 93 persons with disabilities, with 93 still employed atthe year's end.
INOVANCE recognizes that employees are the company’s most valuable asset.Adhering to the core value of "contributor oriented," we strive to foster a culturethat values "people," ensuring employee rights, promoting employee welfare,and working to create a diverse, equal, inclusive, and trustworthy workplaceatmosphere. We enhance safety management to ensure occupational healthand safety, creating a healthy and safe working environment for employees. Wefocus on talent development, facilitate promotion channels, grow together withour employees, and continue to cultivate more outstanding talents for theindustry.
Employee Development GuaranteeEmployee Development Guarantee
7.1 Employee Rights and Welfare Protection
INOVANCE values and protects basic employee rights and embraces diversity. We adhere to fair employmentpractices, prohibit child labor and forced labor, oppose discrimination and harassment, and ensure employees'rights to form unions and engage in collective bargaining, integrating these human rights standards into theBCG, committed to creating a diverse, equal, and inclusive workplace. Additionally, the company valueshumane care, creating the INOVANCE "Five-Level" employee welfare and care system, addressing diverseemployee needs. We also maintain open communication channels for employees, listen to their concerns, andfoster an open and harmonious communication atmosphere.
7.1.1 Employee Diversity, Equity and Inclusion
Equal and Inclusive Work EnvironmentINOVANCE adheres to the principles of fairness, justice, and transparency in recruitment, employment, and theworkplace, prohibiting any form of discrimination or differential treatment. The company commits to provid-ing equal opportunities and treatment in employment, compensation, training, promotion, and termination.INOVANCE has published the INOVANCE Business Conduct Code and Guidelines for the Prevention of Work-place Sexual Harassment among other regulatory guidelines to standardize employee behavior and build ahealthy, safe, equal, and inclusive work environment. We encourage employees from diverse backgrounds toactively engage and spark creative ideas through interaction. To support teams in assimilating and under-standing different cultures, we conduct various cross-cultural exchange and promotional activities to fosterteam integration.The Cable Workshop of the ISC Drive & Control Products Manufacturing Center in Suzhou INOVANCE was honored withthe title of "Women’s Civilization Post" in Suzhou CityIn December 2023, the Suzhou City "Striving Forward on a NewJourney, Achieving New Accomplishments at Posts" themeevent showcasing women's elegance was held at the NationalInspection Building Auditorium in Suzhou Industry Park. Theevent recognized advanced collectives and individuals of 2023,including Suzhou’s Women's Civilization Posts and Women ofAchievement. The Cable Workshop of Suzhou INOVANCE. ISCDrive & Control Products Manufacturing Center received the"Women’s Civilization Post" awards.The Cable Workshop currently employs 67 staff members,including 46 female workers, with an average age of 28 years.The workshop includes 5 female junior-level managers. Thisprofessional and highly quali?ed team has undertaken annualcost reduction and eciency improvement targets, imple-mented innovative work proposals, and collaborated as a teamto meet workshop cost reduction goals, contributing to theachievement of business objectives and earning high praisefrom colleagues upstream and downstream.
The Cable Workshop of ISC Drive & Control Products Manufacturing Center ofSuzhou INOVANCE was honored with the "Women’s Civilization Post" awards
Employee Distribution by GenderEmployee Distribution by Educational LevelEmployee Distribution by Age
Female:
26.19%
Male:
73.81%
Under 30years old:
46.09%
30 to 50years old:
52.66%
Over 50 years old: 1.24%
Bachelor’sdegree: 30.92%
Master’s degree: 13.32%Doctorate: 0.23%
Associate degreeand below:
55.53%
456Non-Chinese-citizen Employees
93Disabled EmployeesDiversity Composition of the Company1,564from Ethnic
Minorities of ChineseNationality
INOVANCE strictly adheres to the Labor Law of the People's Republic of China, the Labor Contract Law of thePeople's Republic of China and other legal regulations, as well as the laws and regulations of the countries andregions where it operates, establishing a comprehensive system to protect employee rights and genuinelysafeguarding employee interests. Building on the standardized system within the company, some subsidiariestailor speci?c employee rights protection systems based on their operational circumstances.
7.1.2 Employee Interests Protection
In the recruitment process, the company upholds principles of fairness, justice, and transparency, conductingrecruitment in an orderly and standardized manner according to the INOVANCE Employee Recruitment Man-agement System, INOVANCE Labor Contract Management Measures. Selection is based on candidates' abili-ties, skills, and adaptability to assess and choose the most suitable talent, avoiding employment discrimina-tion. The company has established and continuously improves the employee recruitment and employmentmanagement system to genuinely protect relevant employee rights.We respect employees' right to freely choose their jobs, committing to providing objective and true recruit-ment information for job seekers to make free choices, not restricting employees to speci?c jobs or thoseagainst their will, and supporting employees in pursuing their personal career goals and development.During the reporting period, there were no illegal employment incidents, and the labor contract signing ratewas 100%.
Equal Employment and Freedom of Occupation
7.1.3 Employee welfare
The company respects and protects employees' legal rights to freely associate, form, and join unions, andparticipate in collective bargaining. Through continuous enhancement of the workers' representative congressand union systems, the company strengthens democratic management and promotes harmonious laborrelations. All employees are allowed to participate in collective bargaining, deliberating or amending regula-tions related to compensation, working hours and holidays, occupational health and safety, employee bene?ts,and employee training. In 2023, the workers' representative congress negotiated and signed CollectiveContracts, Wage Collective Bargaining Agreements, and Special Protection Agreements for Female Employees,covering 100% of employees.
Collective Bargaining and Freedom of Association
The company has established the Protection System for Female Workers and Minors, committing to eliminateany employment or support of child labor. During recruitment and data entry, we verify the authenticity ofprospective employee information through questioning, information checks, and identity document veri?ca-tion. We continuously improve remedial processes for child labor, establishing appropriate treatment andcompensation, counseling for continuation of compulsory education, or repatriation based on the individual’shealth status and educational attainment.The company ?rmly opposes modern slavery and human tracking, prohibits any form of forced labor, andstrictly forbids employees from paying deposits or handing over their IDs when employed. This includes eradi-cating prison labor, bonded labor, debt labor, slave labor, or any forced labor used as a form of punishment.During the reporting period, there were no incidents related to employing child labor or forced labor.
Prohibition of Child Labor and Forced Labor
Regarding compensation, the company complies with all applicable global wage and salary laws, adheres toequal pay, and provides compensation that meets or exceeds legal or industry minimum wage standardsaccording to the Management Procedures for Social Responsibility and Occupational Ethics. It has estab-lished and implemented a series of compensation systems including the INOVANCE Salary ManagementSystem to standardize compensation management.In terms of working hours and holidays, the company has established the INOVANCE Attendance Manage-ment Method and Social Responsibility and Professional Ethics Management Procedure to ensure compli-ance with applicable legal and industry standards concerning working hours. The company offers paid annualleave that exceeds national policy, maternity leave compliant with national requirements, and other leave suchas marriage, bereavement, and paternity leave in accordance with local regulations at operational sites.
Compensation, Working Hours, and Holidays
The company prohibits discrimination, sexual harassment, and any other form of improper or illegal behavior,ensuring equal opportunities and treatment regardless of race, culture, religion, skin color, gender, age, ordisability status. To provide a safe and healthy work environment for all employees, the company has estab-lished the Workplace Sexual Harassment Prevention Standards and corresponding prevention mechanisms,adopting a zero-tolerance policy towards any form of workplace harassment. During the reporting period,there were no con?rmed incidents of discrimination or harassment.
Anti-Discrimination and Anti-Harassment
We ?rmly believe that caring for employees is caring for the future of the company. The company providescomprehensive and diverse bene?ts and care to safeguard the physical and mental health of employees, orga-nizes various cultural activities to promote a balance between work and life, enhances employees' sense ofsecurity, recognition, and well-being, fosters team cohesion and a sense of belonging, and creates a warm,harmonious work environment.The company has established and continuously improved a "?ve-level" employee bene?ts and care system,offering bene?ts that exceed legal standards across the dimensions of "basic, safety, belonging, respect, andself-actualization." This includes purchasing additional critical illness, accident, and life insurance for employ-ees, establishing a charity fund to assist those in need, and enhancing attention to special groups. Speci?cbene?ts and care measures are provided for different categories of employees, such as those who are ill,female, facing hardships, and those working overseas.
Employee CategoryBene?ts and Care Measures2023 Annual Progress
? Established a charity fund for employeesin diculty?Created a support mechanism for
employees with major family emergen-cies, offering swift interest-free loans
Employeesin Diculty
?Organized outdoor yoga and scarfsalon events on Women's Day, andcustom gifts were distributed to allfemale workers?Produced a global cross-border entry andexit handbook for overseas culturalguidance?Addressed overseas employees' payrolland tax issues to ensure healthy, reason-able, and stable bene?ts?Established comprehensive proceduresfor signing and dispatching overseas,promoting global mobility mechanismsfor employees?Established comprehensive overseasinsurance to ensure the safety and healthof employees working overseas
EmployeesWorking Overseas
?Purchased overseas travelinsurance for 119 instances of employee travel
The progress of the EAP for the year 2023 is as follows:
Psychological Assessments: Completed psychological evaluations for all staff and generated reports, collect-ing a total of 4,315 data entries, of which 4,302 were valid, making the validity of the collected data 99.7%.On-site Consultations: A total of 4 on-site EAP consultation sessions were completed.EAP Oine Activities: Successfully held an EAP Launch Day Carnival and 3 Relaxation Salon events. Thecarnival promoted the EAP hotline and knowledge, covering more than 2,000 people across Suzhou andShenzhen bases; the relaxation salons had a total participation of 100 people, with satisfaction ratings of 4.76out of 5 for Suzhou and 4.56 out of 5 for Shenzhen, averaging a total satisfaction rating of 4.69 out of 5.Additionally, in conjunction with the company marathon event, EAP family and child painting interpretationactivities were planned, providing on-site employees with insights into parent-child relationships.
Employee Assistance Program (EAP)
The company places a high emphasis on employee mental health. During 2023, the company implemented anEmployee Assistance Program (EAP), hiring third-party professional organizations to carry out various activitiesto enhance employees’ awareness of mental health management and help them develop a positive mindset.The company established an EAP psychological counseling room in the Suzhou plant and created a specialcolumn on the corporate Feishu platform called “HUI XIN QING” to share daily stress relief tips. Regular on-sitepsychological counseling activities were conducted, offering comprehensive mental health services. Theseinitiatives effectively manage and alleviate employee stress, providing warmth for their physical and mentalwell-being.
Promoting Physical and Mental Well-being
INOVANCE "Five-Level" Employee Bene?ts and Care System
Self-Realization
Social ActivitiesSocial welfareCharitable activities
Value Armation
Awards recognitionTen-year employeerecognitionExclusive parking spots foroutstanding employees
Career DevelopmentLong-Term Incentives
Equity incentivesTraining and enhancementJob rotation mechanismAcademic improvementwhile employedSkill improvement subsidies
Health and Safety
Fitness facilitiesHealth check-upsFirst aid & AEDParent health check-upsSocial insurances and housing fundSpecial environmentTatutory holidaysNight shift allowance
Corporate annual leaveTransportation subsidyNight shift snacksHousing subsidyFlexible working system
Away-from-home allowanceHardship allowance
EAP Inovance Mood
Health seminarsPsychologicalconsultation andmental health check-upsCrisis interventionMeditation & stress relief salonsand workshops
Additional Commercial Insurance
Life/major illness insuranceHospital allowanceAccident/overseas InsuranceLove fund
Respect forNeeds
Departure CareDaily Care Open Communication
Tsummer coolness/winter warmth giftsMaternity careWomen's Day consolationFestive careAnniversary consolationBirthday bene?tsExit interviews
Employee-supervisormeetingsCEO mailbox
BelongingNeeds
SafetyNeeds
Statutory Bene?tsAdditional Bene?tsOverseas Allowances
BasicNeeds
Cultural IntegrationRecreational Activities
Family days Parent-child summer campBirthday partiesLife associationYoung talent networkingSports meetsMentorship programNew employee discussionsOnboarding trainingInovance community
Personalized Bene?ts and Care Measures for Different Employee Categories
Employee CategoryBene?ts and Care Measures2023 Annual Progress
FemaleEmployees
?Established“Mother's Station” nursingrooms at various bases and factory areas?Set up holidays for female employees.?Launched special activities for Women’s Day
?Organized outdoor yoga and scarf
salon events on Women's Day, andcustom gifts were distributed to allfemale workers
7.1.4 Employee Communication and Feedback
In the year 2023, the subsidiary Suzhou INOVANCE completed the construction of a new Staff Home aimed atproviding employees with a comfortable and pleasant leisure space to enrich their cultural lives. This StaffHome spans approximately 1,000 square meters and includes hardware and software facilities such as a gym,yoga room, table tennis room, billiards room, and a staff library. It has formed a multi-functional and compre-hensive service position that integrates ?tness, entertainment, communication, and learning. In 2023, this StaffHome was awarded the title of "Excellent Staff Home."
INOVANCE Running and Fitness AssociationINOVANCE Photography and Hiking Association
INOVANCE "New" Staff Home
In September 2023, INOVANCE held its fourthmarathon & family day event, featuring a fun run,parent-child run, on-site EAP consultations, andcharity activities. This event saw the participationof approximately 1,000 individuals, covering morethan 500 employee occurrences.
INOVANCE Fourth Marathon & Family Day Event
INOVANCE Fourth Marathon & Family Day Event 2023
Employee Communication Channels
INOVANCE places a high value on employee satisfaction, well-being, and engagement. To continue fostering adiverse, equal, and inclusive workplace environment, the company has established seamless online and oinecommunication channels and an effective employee communication mechanism. These initiatives aredesigned to listen to the voices and demands of employees and to provide timely feedback and responses,ensuring that employee issues are resolved promptly.Workers' Congress and Trade Union
The company has established a Workers' Congress system (hereafter referred to as the "Workers' Congress") andhas set up trade union organizations in accordance with legal provisions. These bodies fully play their role indemocratic decision-making, management, and supervision to ensure all employees' rights to be informed, toparticipate, to express themselves, and to supervise. They also promote the institutionalization, standardiza-tion, and proceduralization of the company's democratic management. By the end of the reporting period,trade unions had been established in all the company's main organizations, with a trade union coverage rate
of 89.1%.The Workers' Congress holds regular meetings to sync with the company's development, share growth experi-ences, discuss company issues, and review policies and systems highly related to employee rights. TheCongress negotiates and signs collective agreements with the company. In 2023, the Workers' Congressreviewed and voted on 6 company systems, including Integrated Supply Chain Business Violation Account-ability Management Measures,INOVANCE Information Security Rewards and Penalties Regulations,Out-sourced Personnel Information Security Management Standards,Information Security Incident Manage-ment System,INOVANCE Attendance Management System-V2.0, and Fixed Asset Violation AccountabilityManagement System.
INOVANCE Circle
The company has established "INOVANCE Circle," an employee platform for speaking out and interaction.Whether it is about issues encountered at work, feedback on employee bene?ts, or suggestions for company1 Trade union coverage rate = Total number of employees in the trade union at the end of the reportingperiod / Total number of company employees at the end of thereporting period X 100%.]
The company advocates for a humanized management approach, encouraging employees to engage in sportsactivities that align with their interests and physical ?tness. Employees are urged to commit to long-termismby participating in a health check-in system. The company has formed 29 life associations covering basketball,football, badminton, swimming, yoga, dance, and more. It actively organizes a variety of cultural and sportsactivities, such as outdoor team-building, sports meets, family days, and company-wide health check-ins toenhance employees' physical ?tness, enrich their leisure life, and strengthen team cohesion. Libraries and restareas equipped with various ?tness facilities, such as treadmills, table tennis rooms, and yoga studios, havebeen built in major areas to provide employees with conditions for relaxation and leisure. Additionally, thecompany has established a one-stop service platform and equipped service robots to offer employee services.
Balancing Work and Life
EAP Empowerment Training: Completed a total of 4 sessions of EAP empowerment training for managersand HR, with approximately 500 participants in total. The HR empowerment course received a satisfactionrating of 4.24 out of 5, and the manager empowerment course received a satisfaction rating of 4.53 out of 5.In line with festivals such as Qixi (Chinese Valentine's Day) and World Mental Health Day, 3 EAP oine andonline empowerment courses were planned and organized, with a total of approximately 100 participants.
7.2 Talent Attraction and Retention
INOVANCE places a high emphasis on attracting and retaining talent, employing diverse recruitment channelsand initiatives to draw and retain talent, and establishing a remuneration system and talent incentive mecha-nisms that are both fair and competitive, to fuel the enthusiasm of the organization and its employees.
The company has established a diversi?ed talent recruitment system that attracts and selects outstandingtalents through a broad range of recruitment channels. In 2023, the company actively built its employer brandand was honored with multiple awards.
7.2.1 Talent Attraction and Recruitment
In April 2023, Hunan University of Technology and INOVANCE jointly established the indus-try-characteristic "INOVANCE Class." This collaboration is an implementation of the national"Revitalize the Country through Science and Education" strategy, advancing the integration ofproduction and education, and the innovation of school-enterprise cooperation mechanisms. Itrepresents concrete and effective measures to deepen the cooperative efforts in education,talent cultivation, employment, and development. "INOVANCE Class" carries out the "collabora-tive education" main function of universities and enterprises. Relying on the Electrical andInformation Engineering College of Hunan University of Technology as the teaching platform, itbegan with the construction of the automation specialty. Combining the industrial advantagesof INOVANCE in both parties jointly established an "industry characteristic" school-enterpriseco-training class.In the future, based on the new platform for joint training under the backdrop of full industrial-ization, through "joint planning," "student co-selection," "teacher co-education," "curriculumco-creation," "practical co-guidance," and "project co-training," the goal is to achieve a closeintegration of "theory and practice." The initiative aims to cultivate compound engineeringapplication talents with excellence in both professional theory and professional capabilities.
INOVANCE and Hunan University of Technology Co-Established "INOVANCE Class"
"INOVANCE Class" School-Enterprise discussion meeting
development, everyone can speak freely and contribute ideas. We value employee opinions and suggestions,take them seriously, and respond promptly to ensure that employee demands and thoughts are quicklyaddressed.
Whistleblower Mechanism
The company has established an all-year-round real-time rolling whistleblower mechanism. If employees haveopinions about the work environment or ?nd issues in the production and business process, or if they havegood suggestions, they can submit them through the whistleblower backend system. The trade union willreview the proposals and organize them for reporting. Effective proposals, once reviewed, will be implementedby the company and rewards will be given to the proposers. In 2023, there were a total of 27,944 whistleblow-ing proposals, with 18,267 deemed effective.
President's MailboxUpholding the core value of "Customer ?rst" the company has set up a "President's Mailbox," aimed at reducingbaseline issues on the customer side. Internal employees can use this direct line to complain about any derelic-tion of duty.Employee Satisfaction SurveyEach year-end, the company conducts a satisfaction survey among all employees, covering dimensions such ascorporate culture, organizational atmosphere, and organizational health. The survey collects genuine thoughtsand needs from the employees, formulates improvement measures for core issues, and implements theseimprovements across departments, regularly carrying out a closed-loop review of the improvements. In 2023,the employee satisfaction survey scored 4.45 out of 5.
The company's talent recruitment is mainly divided into three parts: campus recruitment, social recruitment,and front-line workers recruitment.In terms of campus recruitment, the company has carried out diverse collaborations with universities, such assetting up "INOVANCE classes" and co-establishing laboratories. These collaborations provide scenario-basedcase studies from the company’s experience and the ?eld of industrial automation for teaching, helpingstudents to understand the application scenarios of various industrial automation products in a more intuitiveand vivid manner. During the recruitment season, we maintain close interaction with schools, taking theapproach of "sending teaching to the door," going to schools to conduct various themed lectures that covercareer guidance and industry expert sharing. The aim is to assist students in combining theoretical knowledgewith practical experience, to broaden their horizons, and to understand more comprehensively the applicationof various technologies within the industry.
Various Recruitment Channels
Regarding social recruitment, the company upholds the philosophy of "careers attract people" for the intro-duction of high-end talents. We are not only looking for high-end talent but more importantly, providing themwith a platform for career development. We ?rmly believe in the potential and value of talent and are commit-ted to providing them with an environment full of opportunities and challenges, allowing them to fully utilizetheir talents and achieve their career aspirations.Our front-line worker recruitment also covers both campus and social recruitment aspects. For campus recruit-ment, we collaborate with various technical college to carry out INOVANCE class projects, integrating someprofessional training into school courses in advance to promote students' understanding of the workplace,offering employment guidance, and helping them better prepare for employment. For social recruitment, weuse multiple channels, including traditional online recruitment as well as emerging media platforms likeDouyin and Xiaohongshu. The use of these channels helps us reach a broader audience and attract suitabletalents for our positions.
7.2.2 Talent Retention and Motivation
The company places a high priority on talent reserves and building talent echelons, offering targeted retentionmeasures for different categories of talent, continuously optimizing the cadre care mechanism, and hasconstructed a “contributor oriented” compensation system and incentive mechanism. Additionally, it conductshuman resource digital transformation in a "digitized" manner to enhance the management eciency of thetalent system.
Overseas Corporate Culture DevelopmentAs the GLOCAL strategy fully implemented, the company continues to accelerate the attraction and placementof overseas talent. We adhere to the "One Team" philosophy, reshaping overseas talent development and teambuilding. To spread corporate culture and enhance team communication, we undertake various initiativesincluding translating and disseminating internal company information, hosting training camps for overseascolleagues, organizing online and oine exchange activities, and inviting new overseas employees to visitChina to better understand the corporate culture. Additionally, to foster a proactive atmosphere and extensiveoversight, the company has established the Overseas Ethics Compliance Committee (OEC) team. This team isresponsible for assisting in the implementation and conveyance of INOVANCE’s core cultural values at overseasoperations, handling special key incidents abroad, and aiding in compliance reviews and supervision of leader-ship conduct as per BCG guidelines. Through organizational and institutional safeguards and advocacy, thecompany enhances mutual respect and understanding among employees.
The company has established a retention system covering fresh graduates, socially recruited personnel,experts, and key position talents. For fresh graduates, in 2023, the company launched the "Three-Year FreshGraduate" plan aimed at providing comprehensive training and growth opportunities for campus recruitmentpersonnel. In the ?rst year, graduates will quickly adapt to their work roles through mentorship and tieredlearning; in the second year, they receive advanced training alongside practical work to further enhance theirskills and technical levels; by the third year, they will have the capability to perform independently. This train-ing plan helps campus recruits grow better and faster, signi?cantly improving their capabilities in variousaspects.For socially recruited personnel, the company has established a "New Employee Training Mechanism." Newemployees are paired with dedicated mentors to help them integrate into the company and start operationsswiftly. For experts, the company highly values and proposes a "One Axis, Four Lines" expert care mechanismaimed at helping experts better integrate into the company and fully utilize their value. For key positiontalents, the company categorizes them according to different levels of key tasks, continuously monitoring andevaluating them. When these talents face bottlenecks, the company actively creates opportunities to helpthem resolve issues.
Talent Retention System
Overseas employees came to China to participate in the company's 20th anniversary celebration.
Employer BrandingHonors and Awards
2023 China Talent Management
Excellence Award
2023 China's Best Employer with Outstanding Intelligent Manufacturing Spirit
2023 NFuture Most Socially ResponsibleCampus Recruitment Employer2023 Guangdong Exceptional Employer
of the Year
2023 Employer Brand Management
Model Award
In 2023, the company established a series of cadre management systems, including "Selective Cultivation andRetention," and fully upgraded the cadre appointment system by introducing a tenure system and setting agelimits for cadres to invigorate their dynamism. Additionally, we engaged external experts to conduct trainingon the concepts of mission and responsibility for cadres. The company also iterated and upgraded individualperformance management for cadres, clarifying the performance metrics for both cadres and employees.Going forward, the company will further strengthen the care and management of mid-to-senior level cadres,including personal accountability, system building, and compliance.
Cadre Care Mechanism
Company Talent Echelon Situation
28.6%40.7%13.2%0.7%
Proportion ofjunior talent
Proportion ofmid-level talent
Proportion ofsenior talent
Proportion ofexpert-level talent
The mission of our company's digital HR initiative is "to drive human resources with digital intelligence,connecting every individual and every organization with digitized ideas and methods to continuously improveeciency, experience, and safety." This mission is pursued through three main aspects: empowering business,empathizing with employees, and jointly pursuing a vision. These efforts aim to enhance the value of humanresources and ultimately promote business success.On a practical level, we address two core challenges: the mismatch between HR supply-demand capabilitiesand the alignment of organizational goals with individual motivations. Our approach involves systematicdesign integrated into business processes. For example, in the employee performance evaluation process,there is a "I want to develop" link, which advertises new positions that employees can apply for if interested,followed by appropriate feedback and arrangements after internal assessment.
Digital Transformation of Human Resources
Adhering to the core values of "contributor oriented" and principles of fairness and justice, the company hasbuilt a compensation system that includes salary, allowances, bonuses, long-term incentives, and statutorybene?ts. The company has established various compensation management systems, such as the EmployeeFixed Salary Management Method and Bonus Management Method. Through job grading and performanceassessment mechanisms, the company clearly directs contributions, adheres to "anti-mediocrity," and providescompetitive compensation and bene?ts to inspire employee vitality and creativity.Compensation-wise, based on the company’s operational characteristics and talent strategy, the companyadopts a partly leading compensation strategy, and for some key positions, a fully leading compensation strategyis applied. The company conducts job grading annually and reviews employee levels and compensation basedon job grading standards, job compatibility results, and external competitive compensation insights.
Employee Compensation and Incentives
7.3 Employee Training and Development
INOVANCE upholds the talent philosophies of "Responsibility, Professionalism, Enterprise" and "Pragmatism,Positivity, Diversity." In alignment with the company's development strategy and employee growth demands,it actively constructs a development platform that values "people," providing rich and high-quality learningand growth opportunities to support individual growth and career development. This also empowers thetalent reserves and development across the entire industry ecosystem.
Eciency
ExperienceSafety
The mission of digitalization
in human resources.
Additionally, we actively explore the application ofAI technology, using it to deeply understandemployee pro?les and job roles, treating AI as anagent for each employee. This enables matching ofproject opportunities, job transfers, group and teammemberships, as well as connections betweenindividuals with similar interests and hobbies.Through AI’s intelligent matching, effective interac-tions and resource sharing among employees areachieved, realizing the true essence of "INOVANCE ofINOVANCE People."
Talent Incentive Mechanisms
Benchmarkingand Recognition
Annually, the company conducts recognition events to provide bonuses and honors to outstandingemployees. In 2023, the company recognized 74 outstanding teams and 178 outstanding employ-ees from the previous year.
EquityIncentives
The company continues to launch equity incentive plans, creating a mechanism for employees toshare interests with the company and motivate management teams, outstanding staff, and keytalents. In 2023, the company implemented the sixth phase of the equity incentive plan reservedfor 245 individuals and the second phase of the long-term incentive plan covering 118 individuals.As of the end of the reporting period, the ongoing equity incentive and long-term incentive planscovered 1,256 employees, accounting for 5.2% of the total company workforce, with non-seniormanagement comprising 98.48%.
TalentSubsidies
The company actively assists employees in applying for various talent subsidies to provide morebene?ts and support..
INOVANCE places high importance on talent development, establishing a training system for employees atdifferent levels and categories. Through various learning methods such as course training, specialized studies,and oine intensive training, the company offers abundant learning resources aimed at developing leadershipin managers, professional and technical skills in employees, and collaborative business capabilities within theecosystem. The company has formulated systems and procedures such as INOVANCE New Employee TrainingManagement System, INOVANCE Outsourced Training Management System, Course System Document,Training Management Procedures to ensure the effective and standardized operation of the employee train-ing system.Since establishing the "INOVANCE Academy" (originally named "INOVANCE University") in 2018, the companyhas continually enhanced and strengthened the construction of its employee training system. It shoulders themission of "accelerating the growth of talent in the INOVANCE ecosystem through a training-to-combatapproach," adopting a tripartite core methodology of "situational reproduction, case study, and training com-bined with combat." This approach is used to create high-quality training programs and courses, developoutstanding internal instructors, and accumulate, consolidate, and share internal organizational wisdom,providing professional and high-quality training resources to meet the learning needs of employees.During the reporting period, the total duration of training provided to employees reached 686,347.40 hours,with an average training duration of 26.93 hours per employee, achieving a training coverage rate of 100%.
7.3.1 Employee Training System
Total Training Duration
686,347.40hours
Average Training Duration
26.93hours
Employee Training Coverage Rate
100%
In alignment with strategic planning and business development, the company has summarized and solidi?edthe essence and wisdom of its rapid management growth, sharing our advanced concepts and methods withecosystem partners to continually promote the accelerated training of ecosystem talent, and achieving mutualprogress and success with ecosystem partners. Facing customers, channel partners, and investment enterpris-es among other collaborators, we have launched targeted training programs to foster the development ofecosystem talents across multiple dimensions and levels.For the technical personnel of INOVANCE customers, we launched the IET Ecosystem Technical CapabilityEmpowerment Project, providing both standard and customized training solutions to strengthen the technicalpersonnel’s product application skills and support customer business enhancement. In 2023, the IET projectestablished 10 classes, training a total of 141 people.The Distributor Technical Capability Training and Certi?cation Project primarily targets technical personnelwithin the INOVANCE Distributor system, aiding in the upgrade of agent technical capabilities. In 2023, atotal of 16 projects were launched, training 519 technical personnel from upstream and downstream industrychain partners.Targeting mid-to-senior level managers within INOVANCE ’s invested companies,we initiated the Outstand-ing Partner Training Camp (OCT) project, aimed at fostering the incubation of the INOVANCE InvestmentEcosystem. The project facilitated mutual visits and support among various enterprises, establishing businessconnections and promoting bene?t enhancement. In 2023, the OCT project set up one class, training 42people, with 80 hours of oine intensive training.
Business Collaboration in the Ecosystem
The company focuses on the training and development of management talent, establishing multi-level man-agement talent echelons based on the cadre's four competencies, around the "three do's and three builds"manager role model. A leadership training system for managers has been established, matching leadershipenhancement elements according to different management levels to promote and leverage key leadershiproles.For potential management talents, the RMT (Rising Manager Training) program is conducted, which includespre-training learning, oine intensive training, and personal real-world application. This program is designedto awaken management awareness, train management thinking, and help participants prepare for manage-ment roles early. In 2023, the RMT program trained 178 individuals across 4 classes, with 43 hours of oineintensive training.For newly appointed managers, the NMT (New Manager Training) program is conducted, focusing on realmanagement scenarios for new managers, using case studies to systematically enhance the comprehensivemanagement capabilities of new managers through individual and team projects, further encouraging practi-cal application. In 2023, the NMT program trained 120 people across 3 classes, with 74 hours of oine intensivetraining.For middle-level managers, the MMT (Middle Manager Training) program incorporates content on change andculture into the curriculum to keep pace with business development, includes external experts for actionlearning, and establishes company-level research projects to continuously enhance the ability of participantsto solve complex problems, thus supporting company development. In 2023, the MMT program trained 42individuals, with 85.5 hours of oine intensive training.For senior managers, the TMT (Top Management Training) program includes collective learning such as thechairman's 20th-anniversary keynote speech and wisdom from The Book of Changes, producing a wealth ofexcellent insights and experiences on life wisdom. The program also includes open classes on The Book ofChanges and the ?rst INOVANCE cadre conference, helping senior cadres of INOVANCE grasp the wisdom ofThe Book of Changes and forge a leader's spirit. In 2023, more than 170 participants were involved in the TMTprogram, with 30 hours of concentrated online learning.
Leadership Development
We believe that only through long-term focus can one become truly professional. A combination of profession-alism and long-termism embodies the “obsessive” traits necessary for the pursuit of excellence. Therefore, toenhance the professional abilities and technical skills of our employees, the company has established a seriesof learning programs that correspond to the employees' growth trajectories. These programs focus on businessscenarios and pain points, distill best practices in business, and foster solutions through collaborative innova-tion, thus developing a robust team of professionals across various ?elds.In 2023, the company continuously offered the ART training program for junior and intermediate marketingmanagers to enhance the comprehensive sales capabilities of marketing personnel; the advanced SRT trainingprogram for solution representatives to boost their competencies in crafting competitive solutions; the RPTtraining program for research and development project managers to enhance their project management skills;and the CPT training camp for chief product ocers to improve product managers’ market insights, demandmanagement, and product de?nition skills. In 2023, the ART program launched one junior class and two inter-mediate classes, training a total of 130 people; the SRT program launched two advanced classes, training atotal of 84 people; the RPT program launched one intermediate class, training 36 people; and the CPTlaunched a PMT junior class, training a total of 63 people.
Professional and Technical Competence of Employees
In 2023, driven by strategic imperatives and the actual development needs of the business, the companycontinuously launched new projects and iterated on existing training programs to enhance the capabilities ofboth the organization and its employees:
In 2023, the company launched the Digital Transformation Gold Seed Training Camp (DST) trainingprogram for the 3+2 business backbones, change agents, data BPs, and IT personnel involved in the digitaltransformation process. The program was designed to help participants utilize enterprise architecture anddata governance methods to aid the company's digital transformation efforts. The DST program consisted ofthree classes that trained a total of 161 people, divided into three phases, with 76 hours of oine intensivetraining.The company also introduced the General Project Management for Automation (GPMT) project for marketsystem project management personnel. This project integrated external benchmark management conceptsand courses, progressively building a company-wide project management training system to enhance employ-ees' project management awareness and skills. In 2023, the GPMT project offered three classes, training a totalof 203 people, with 24.5 hours of oine intensive training.The Business Vanguard Training Camp (BVT) is a development program designed for core operationaltalents within heavyweight teams. The program included directors and reserve directors of SPDT, totaling 37individuals. Based on its 2022 initiatives, the 2023 BVT introduced a new action learning training model,conducted three intensive training sessions totaling 58.5 hours, and carried out two rounds of action learning,resulting in solutions for ten interdisciplinary challenges. The project fostered a culture of team co-creationduring its execution, fully engaging the collective intelligence of the directors, enhancing mutual businessunderstanding among participants, and improving cross-disciplinary operational capabilities within signi?-cant teams.
EmployeeTraining Categories
Training ProgramTarget ParticipantsMain Content
ProfessionalTalent Training
Account ResponsibilityTraining CampARTSolution RepresentativeSpecial Training Camp (SRT)General Automation ProjectManagement (GPMT)
Marketing personnelprimarily from the generalmarket departmentCore talents from theVertical Solutions CenterProject managementpersonnel in the marketsystem
Focusing on BusinessScenarios and Pain Points:
We summarize INOVANCE'sbest business practices,providing specializedempowerment to cultivateprofessionals in marketing,R&D, digital transformation,solutions, and projectmanagement.
New EmployeeTraining
ManagementTalent Training
New Power Training Camp(NPT)New Energy Training Campfor Socially RecruitedEmployees (NET)New Employee TutorTraining camp (NTT)Rising Manager TrainingCamp (RMT)New ManagerTraining Camp (NMT)Middle ManagementTraining Camp (MMTProject)Senior ManagementWorkshop (TMT)
All campus-recruited newemployeesAll socially recruited newemployeesNew employee mentorsReserved cadres identi?edfrom various systemsNewly promoted managersMiddle-level managers(including director-level andsenior manager-level cadres)Assistant director-level andabove managers and level?ve experts
Focusing on CorporateCulture Integration: Byemploying a variety oflearning methods, human-ities education is integrat-ed throughout the projectto help new employeesunderstand the company’scultural values and enhancetheir cultural identi?cation.Creating a ContinuousLearning Environment forManagers: By introducingexternal experts andsharing internal organiza-tional knowledge, acontinuous learningatmosphere and mecha-nism are created formanagers.
EmployeeTraining Categories
Training ProgramTarget ParticipantsMain Content
ProfessionalTalent Training
Digital Transformation GoldSeed Training Camp (DST)R&D Project ManagerTraining Camp (RPT)Business Vanguard TrainingCamp (BVT)Chief Product OcerSpecial Training Camp (CPT)
3+2 Key business backbone,Transformation projectsmembers, data businesspartners, IT personnelLevel 3 general projectmanagement talent in R&DmanagementCore operational talentsfrom Heavyweight TeamsMarketing team members
Focusing on BusinessScenarios and Pain Points:
We summarize INOVANCE'sbest business practices,providing specializedempowerment to cultivateprofessionals in marketing,R&D, digital transformation,solutions, and projectmanagement.
Training of
Engineeringand TechnicalTalents
New Force Special TrainingCamp (NFT)Market IntermediateTechnical Training ProgramCreation Camp Project
Newly-recruited Graduatesat Marketing PositionsRookies with 1-2 WorkingExperience at MarketingPositionsInterns at Marketing Positions
Technical Knowledge andSkills Training for MarketingEmployees: Technicalknowledge and skillstraining are conducted formarket system employeesto help them understandand familiarize themselveswith INOVANCE's starproducts and projecttechnical knowledge,enhancing their productapplication capabilities.Outstanding ManagerTraining Camp (OMT)Channel CEO Training Camp(ODT)Outstanding Partner SpecialTraining Camp (OCT)ART External ProjectChannel Technical Capabili-ty Training and Certi?cationProjectIET Ecological TechnicalCapability EmpowermentProject
Management level ofINOVANCE's customersHigh-level Managers ofDistributorMid-to-senior level manag-ers within INOVANCE'sInvested companiesKey sales personnel withinINOVANCE's DistributorsystemTechnical personnel withinINOVANCE's DistributorsystemTechnical personnel ofINOVANCE's customers
Combining StrategicPlanning and BusinessDevelopment: We summa-rize and consolidate theessence and wisdom of ourrapid development, sharingour concepts and methodswith ecosystem partners tocontinuously accelerate thetraining of ecosystemtalent and achieve mutualprogress and win-winoutcomes with ecosystempartners.
ProfessionalTalent Training
In terms of employee promotion and development systems, the company has built a comprehensive careerdevelopment channel based on job sequences, including management, professional, project management,and skilled talent pathways. The professional pathway, relying on job quali?cations, aims to pull employeecapabilities for improvement and development. The company has established promotion managementsystems such as Company updated the INOVANCE Quali?cation Management System and ManagementRegulations for Work License Implementation as guidelines for employee promotion and development,providing a clear path for career development and effectively preventing potential discrimination in the careerdevelopment and promotion process.Every year, based on job quali?cation standards, the company conducts employee capability certi?cations,making employee abilities explicit, placing the right employees in the right positions through job matching,and providing an internal talent circulation mechanism to promote internal mobility. Speci?cally, for hybridkey positions such as project managers and product managers, based on the principle of "where they comefrom, where they go," a preliminary cross-position talent development path has been formed.In terms of employee performance assessment and promotion, the company has established systems likeIndividual Performance Evaluation Process, following a performance assessment ?ow that includes perfor-mance goal setting, performance coaching, performance evaluation, performance result interviews, perfor-mance appeals, and performance result application and archiving. Every 6 months, a performance evaluationis conducted for all employees, and the results are used as the basis for employee promotion, development,and salary adjustments. During the reporting period, 100% of the company's employees underwent regularperformance and career development evaluations.
7.3.2 Employee Promotion and Development
Online Learning Platform ConstructionTo facilitate more ?exible, convenient, and autonomous learning for employees, the company has establishedan online learning platform for knowledge accumulation, exchange, and sharing. In 2023, the platform accu-mulated 8,398 courses, launched 10,317 learning projects, with 24,991 active user accounts, and totaled426,427.40 hours of learning.Internal Trainer System
Outstanding instructors and high-quality courses are the soul of INOVANCE Academy. In 2023, focusing on thecompany's and various systems' talent training needs, the portrait of instructors and the "select, train, use,retain" process for instructors were continuously upgraded. Course development and teaching methodologieswere iterated, and the instructor system was strengthened to continuously cultivate and output excellentinstructor resources, empowering employee career development. In 2023, the company conducted 5 juniorinstructor certi?cation classes, 1 intermediate instructor certi?cation class, and 1 senior instructor certi?cationclass, certifying 179 junior instructors, 33 intermediate instructors, and 33 senior instructors, and awarded thetitle of "Gold Medal Instructor" to 4 individuals.
The company has established a Safety Production Committee (hereafter referred to as the "Safety Commit-tee"), responsible for the overall management of company safety production, the development of technicalmeasures and occupational health and safety plans, safety production inspections, and supervision. Thechairman serves as the committee leader and the highest responsible person, with the director of thepresident's oce serving as the deputy leader. Under the committee, a Safety and Environmental ProtectionDepartment is responsible for advancing speci?c EHS management tasks. Additionally, the Safety andEnvironmental Protection Department appoints EHS commissioners in major factories and subsidiaries toconvey and implement headquarters' EHS requirements, reporting directly to headquarters about the EHSsituations.
INOVANCE strictly adheres to the Safety Production Law of the People's Republic of China and the legal andregulatory requirements of each operating location. The company has established systems such as theINOVANCE EHS "Three Simultaneous" Management System of Construction Projects and INOVANCE SafetyPerformance Assessment System. It continuously improves the safety production management system, cover-ing all aspects of corporate operations.
7.4.1 Safety Production
Safety Management System
7.4 Occupational Health and Safety
INOVANCE adheres to the safety policy of "safety ?rst, prevention foremost, and comprehensive manage-ment." With a long-term goal of achieving four "zeroes" in EHS, it continuously improves the occupationalhealth and safety management system, strengthens safety risk management and safety culture construction,advances occupational disease prevention and control, and promotes general occupational health knowl-edge, safeguarding employees' occupational health and safety.
Occupational Healthcheck-ups Coverage
100%
Employee Coverage under the InternallyAudited Occupational Health and SafetyManagement System
74%
Proportion of Operational Sites that haveImplemented Employee Health and SafetyRisk Assessments
73%OccupationalDisease Incidents
0times
Key Performance Indicators for 2023
EHS Goals
Zeromajor safety accidents
Zeroenvironmental incidents
Zerooccupational diseasesZeropenalties
Core EHS Management Systems
INOVANCE EHS "Three Simultaneous" Man-agement System of Construction ProjectsNOVANCE Work Injury Accident HandlingProceduresSafety Performance Assessment SystemEHS Rewards and Penalties ManagementProcedures
Occupational Health Management SystemHazardous Waste Management SystemCon?ned Space Safety Management SystemR&D Laboratory Safety Management System
Safety Risk ControlTo effectively identify and control occupational health and safety risks, the company follows managementdocuments such as the Hazard and Environmental Factors Identi?cation and Assessment System, establish-ing procedures for hazard identi?cation, assessment, and control. Annually, the company identi?es and cate-gorizes occupational health and safety risks associated with company activities, products, services, andoperating conditions.In identifying and assessing occupational health and safety risks, the company uses relevant standards andguidelines to identify hazards, applying intuitive experience and hazardous conditions assessment methodsfor risk evaluation. The hazardous conditions assessment method is a semi-quantitative evaluation of hazardswhen operating in potentially hazardous environments, using the probability of an accident (L), the frequencyof exposure to hazardous environments (E), and the potential consequences of an accident (C) to determinethe hazard score (D) and thus the hazard level.In terms of risk control, the company develops corresponding risk control plans and measures for differenthazard levels, using a "PDCA" work mechanism to continuously monitor and improve safety risks.During the reporting period, the company experienced no fatalities, and the proportion of operational sitesthat implemented employee health and safety risk assessments was 73%.
To prevent the impact of hazardous chemicals on employee health, the company has established systems suchas the Chemical Management System and Integrated Supply Chain Hazardous Chemicals ManagementStandards, managing the entire process of purchasing, Transporting, handling, storing, and disposing ofhazardous chemicals:
?Purchasing Hazardous Chemicals: Reviewing the supplier's hazardous chemical production quali?cations,chemical safety data sheets, and chemical safety labels; requiring purchasing personnel to be trained and certi-?ed before starting work.?Transportation and Handling of Hazardous Chemicals: Reviewing the quali?cations of transportationvehicles, escort personnel, and loading/unloading staff, and establishing strict operating standards.?Storage of Hazardous Chemicals: Using specialized warehouses equipped with relevant safety devices,uniformly marked and stored by category; regularly inspecting storage conditions and promptly makingcorrections.?Use of Hazardous Chemicals: Strictly controlling the usage and operation process; requiring operators to becerti?ed and wear prescribed protective gear during operations.?Disposal of Hazardous Chemicals: Prohibiting direct discharge or disposal, collecting all waste uniformly, andentrusting it to a third party for professional disposal.
Hazardous Chemicals Management
Emergency Management
To rapidly respond to and effectively control various occupational health and safety incidents, minimizingpersonnel casualties and property damage from accidents, the company has formulated and released theProduction Safety Accident Emergency Rescue Plan, which includes one comprehensive emergency plan, ?vespeci?c emergency plans, and ?ve on-site handling schemes.The company regularly organizes all employees to conduct emergency drills to enhance their ability to manageaccident risks. This year, the company organized all employees to conduct 10 emergency drills, covering cate-gories such as ?re, personal injury, food poisoning, and severe weather. In the future, the company will expandthe range of emergency plans and exercises, continuously improving and enhancing its risk response andemergency capabilities.
Suzhou INOVANCE Fire Evacuation Drill
During the 2023 EHS Activity Month, SuzhouINOVANCE organized 5 ?re drills, covering variousSuzhou INOVANCE factory areas, with 3,418participants, reaching a historical high in bothcoverage area and participant numbers. The drillsmainly pre-enacted various scenarios where ?rescould occur, ensuring that employees understandand are familiar with the entire emergencyprocess of ?re evacuation and escape. The WuZhong District Fire Brigade was invited to
Suzhou INOVANCE Fire Evacuation Drill
To ensure the effective execution and continuous improvement of the company's safety management work,regular Safety Committee meetings are convened based on the establishment of the Safety Committee, andEHS-related policies, hazard prevention measures, and supervision reviews are discussed and improved.As of the end of 2023, the Safety Committee consists of 13 members, representing 100% of the employees;the company has conducted one Safety Committee meeting, reviewing and enhancing two safety manage-ment system documents.
conduct real-life training projects, including ?re truck entry into the factory area, ladder rescues, and?re equipment operation training, further enhancing employees' safety awareness and emergencyself-rescue capabilities, accumulating valuable experience for dealing with real ?res. After the drills,management departments organized improvement measures for issues identi?ed during theexercises and re?ned the emergency plans to ensure that the company's emergency plans are morescienti?c, reasonable, and ecient.
The company has established a multi-category, multi-level occupational health and safety internal reviewmechanism, conducting regular inspections weekly, monthly, and annually to identify safety risks at all sitesand propose corrective measures for potential hazards, monitoring and following up on remediation.?The Safety and Environmental Protection Department, as the executing agency, conducts routine on-siteinspections of all workshops and areas monthly and supervises the correction of identi?ed hazards.?The Supply Chain EHS conducts its own monthly inspections, including but not limited to equipmentsafety-related issues.?Shift leaders and team leaders in the production plants conduct weekly inspections. Based on their listedissues, the Safety and Environmental Protection Department develops corresponding measures and deadlinesfor remediation, provides targeted remediation guidance, and after completing the remediation cycle,requires uploading photos of the remediation for review and con?rmation by the Safety and EnvironmentalProtection Department, forming a PDCA work mechanism.During the reporting period, the Safety and Environmental Protection Department completed monthly safetyproduction reviews for all production areas, identifying 747 hazards, with a remediation rate of 100%. Healthand safety guidelines were written in the languages most used by employees, ensuring broad comprehensionand adherence.
Safety Production Review
INOVANCE places great importance on employee occupational health and safety, strictly adhering to the Lawof the People's Republic of China on Prevention and Control of Occupational Diseases and regulations of eachoperating location. The company has established the Occupational Health Management System, EHSRewards and Penalties Management Procedures, and other system standards, with the long-term goal of"zero occupational diseases." It builds and continuously improves the occupational health and safety manage-ment system from the aspects of institutional protection, risk management, and daily protection.During the reporting period, 11 companies and subsidiaries passed the ISO 45001:2018 Occupational Healthand Safety Management System certi?cation, an increase of 4 compared to the previous year, due to new oper-ational sites being put into use. Currently, 73% of signi?cant operational sites have passed the ISO 45001:2018certi?cation. The company's occupational health and safety management system covers 78% of employees,both internally and externally audited.
7.4.2 Occupational Health Management
The company regularly conducts safety education and training for all employees through a combination ofonline, oine, and practical drills to improve employees' safety skills and awareness. During the reportingperiod, safety knowledge training was conducted for all staff, along with six specialized safety trainings, includ-ing ?rst aid, ?re safety, and occupational disease prevention, covering 18,292 employee participants. The train-ing also extended to subcontractors and partners required to work on-site.
Safety Culture Development
In 2023, under the theme "Everyone Speaks Safety, Everyone Knows Emergency Response," we conducted anearly two-month-long Safety Production Month event, including publicity and education, ?rst aid training,online knowledge quizzes, escape room experiences, and ?re emergency drills.Safety Production Month
To thoroughly implement the company's occupationalhealth and safety management policies and systems,further popularize knowledge of safety production, andenhance the safety awareness of leaders at all levels, aswell as employees in various departments and subsidiar-ies, the company organized an online safety knowledgecompetition during the Safety Production Month in2023. A total of 6,493 individuals from 24 departmentsand subsidiaries participated in the competition, with atotal of 10,726 participants. Among them, 400 individu-als won prizes, making the winning rate 6.2%.
Online Safety Knowledge Competition
Online Safety Knowledge Competition
To enhance the safety awareness of safety personnel andequip them with basic emergency ?rst aid knowledgeand skills, enabling them to effectively administerself-aid and mutual aid in the event of accidentalinjuries, thereby minimizing loss of life and property, thecompany conducts ?rst aid training for relevant person-nel at the safety management institute level. The trainingprimarily covers commonly used techniques such as"Cardiopulmonary Resuscitation (CPR)" and "First AidSafety Tips for Burns, Fractures, etc." A total of 34 safetyinspectors, secretaries, and front desk staff participatedin the training. Those who pass the training will receivea "First Aid Training Certi?cate" issued by the Red Cross.
First Aid Training
Practical First Aid Training
Theoretical Knowledge Training in First Aid
To implement ?re accident prevention measures, strengthen ?re safety supervision, eliminate ?rehazards, maximize the prevention and reduction of casualties and property damage caused by ?reaccidents, and enhance the ?re safety awareness and self-rescue skills of employees, the companyorganized the Fire Safety Month event. Additionally, the company has established a volunteer ?rebrigade, currently consisting of 9 certi?ed members.
Fire Safety Month
Safety Information BoardSafety Promotion PostersFire Safety Skills CompetitionCompany Volunteer FireBrigade
In terms of occupational disease protection, the company deepens employee prevention and treatment, strict-ly implements the Three Simultaneous measures for occupational health, compiles occupational diseasehazard assessment reports, implements occupational disease prevention engineering measures, and conductsregular on-site occupational disease hazard detection and occupational health-related hidden danger inspectionsannually, monitoring and rectifying occupational disease risks. Identi?ed occupational disease hazards thisyear include noise, acrylic acid, tin dioxide, and butyl acetate.Furthermore, the company strengthens the management of employees' occupational health, providing occu-pational health services to employees. For all employees, regular health examinations are conducted; foremployees involved with occupational hazards, occupational health records are established; for employeesexposed to physical injuries and occupational disease hazards, supplemental health insurance is purchased;for employees in positions with physical injury and occupational disease risks, personal protective equipment(PPE), such as earplugs for those exposed to noisy environments, is provided to ensure their health and safetyduring work. Additionally, we enhance human-machine safety design and add equipment safety acceptanceprocesses to further fortify the occupational health and safety defenses for employees.During the reporting period, the company achieved a 100% occupational health examination coverage rate,with no occupational disease incidents or deaths caused by occupational diseases reported.
Occupational Disease Prevention and Control
INCLUSIVE AND RESPONSIBLE
ECOSYSTEM BUILDING
CHAPTER 8
8.1 Building A Sustainable Supply Chain
8.2 Promoting Industrial Cooperation and
Development
8.3 Contributing to Social Development
Inclusive And Responsible Ecosystem Building
8.1Building A Sustainable Supply Chain
8.1.1 Building A Resilient Supply Chain
As the global political and economic situation becomes increasingly turbulent and the accelerated reconstruc-tion of the global industrial chain, supply chain security has gradually become a crucial factor affecting thesustainable development of enterprises, and enhancing supply chain resilience is one of the main develop-ment trends of supply chain management. Based on global and industry development insights, INOVANCEcontinued to strengthen the supply chain's anti-risk capability in 2023, and carry out supplier Multi-TierManagement and Business Continuity Management (BCM), optimized the capability assessment of suppliersin TQRDC, enhanced cooperation with key suppliers, aiming to construct an autonomous, controllable, safe,and ecient supply chain.Supplier Multi-Tier Management
In 2023, INOVANCE continued to categorize and classify suppliers across the entire group, divided suppliersinto levels based on cooperation and performance dimensions, and into categories based on the tier of rawmaterial supply and product operation methods (see the table below for details).
Business Continuity ManagementIn 2023, the company continued to focus on the construction of the BCM system. The company rede?ned andassigned label attributes to manufacturers, materials, and molds based on the needs of Business ContinuityManagement, and formed a list of three categories for decision-making reference. The Company conductedbusiness continuity risk assessment and classi?ed risk levels and risk event scenarios on a quarterly basis. Thecompany has formed a Business Continuity Plan (BCP), which describes in detail the countermeasures andimplementation plans of each department to avoid, mitigate and cope with the relevant risks, and speci?es theemergency response mechanism and decision-making procedures. During the reporting period, the Companyconducted a business continuity risk event drill, simulating a scenario of business interruption caused by thesupply disruption of core components, which helped to re?ne contingency plans for such events.Lifecycle ManagementINOVANCE has established an internal lifecycle management system for suppliers at different stages, coveringsupplier registration, admission audit, performance evaluation, empowerment training, and phase out, alltracked within the management system. In addition to the TQRDC assessment, INOVANCE has incorporatedESG audit in the supplier admission stage to investigate suppliers' environmental, social and ethical aspects.The company conducts TQRDC assessments on suppliers annually, with monthly assessments on suppliers‘quality and delivery performance, and semi-annual overall assessments on TQRDC. The TQRDC assessment isled by the Procurement Strategy Team and assisted by SQE. The Procurement Strategy Team formulates anannual assessment plan and con?rms the assessment list according to supplier categories and transactions,coordinating with SQE to execute the assessment, and ultimately generates an assessment report with excel-lent, quali?ed, to be improved and non-quali?ed ratings.For suppliers who do not pass the performance assess-ment, the company carries out empowerment training to facilitate continuous improvement in supplier perfor-mance.
Key Supplier Cooperation
During the reporting period, INOVANCE strengthened cooperation with suppliers represented by strategicsuppliers to create high-quality products and build component-level solutions through co-creation and co-re-search, forming a competitive industrial chain based on digitalization and innovative concepts, and promotingindustrial progress and sustainable development.
In 2023, the company formulated and issued the Multi-Tier Supplier Management Standards, which involvedanalyzing upstream raw materials for key materials, determining the scope of Multi-Tier Supplier Management,and proposing management requirements for Multi-Tier Suppliers based on aspects such as technology, quality,supply, and cost.
INOVANCE regards suppliers as important partners and is committed to collaborating with upstream anddownstream partners in the supply chain to promote the sustainable development of the entire value chain.The company not only emphasizes the crucial support role of the supply chain in delivering high-quality productsand services, continuously enhances the resilience of the supply chain, and guarantees the security of thesupply chain, but also pays special attention to the sustainable management of supply chain in operationalactivities, maximizes the value creation potential of the supply chain in environmental, social, and governanceaspects. This effort aims to facilitate the establishment of a green, secure, friendly, resilient, and fair businessecosystem.2023 Key Performance Indicators
Pass rate of Suppliersincluded in ESG audits
100
Coverage rate of ESGaudits for New Suppliers
100
Proportion of New Suppliers thathave Signed the INOVANCESupplier Management Contract
100
Proportion of New Suppliers thathave Signed the INOVANCEHonest Cooperation Agreement
100
Pass rate of Hazardous ChemicalsManagement and RoHS ComplianceReviews for key supplierss
100
Supplier Multi-Tier Management
By Cooperation LevelBy Performance LevelStrategic SupplierSupplier to be concerned
Key SupplierGeneral Supplier
Excellent SupplierSupplier to be improvedQuali?ed SupplierNon-Quali?ed Supplier
By Tier of Raw Material SupplyBy Product Operation Methods
Tier 1 SupplierMulti-Tier SupplierManufacturerService ProviderAgent/Trader
During the reporting period, all tier-2 suppliers, in addition to tier-1 suppliers, have been 100% included insupplier management. Moreover, the company has also implemented uni?ed group management for suppliersof the same category.
INOVANCE's 2023 Supplier Conference
8.1.2 ESG Management of the Supply Chain
INOVANCE places great emphasis on ESG management for its suppliers. In 2022, the Integrated Supply ChainManagement Department established a dedicated Dual Carbon Oce to lead sustainable supply chainmanagement. The company's supplier ESG management includes ?ve phases: supplier admission, mainte-nance, audit, performance improvement, and phase out, and dynamic tracking and control of supplier activi-ties related to environmental impact, labor and human rights, sustainable sourcing (con?ict minerals),business ethics, etc, covering all suppliers.
Management of Hazardous Chemicals and Hazardous SubstancesThe company establishes a management system for hazardous chemicals and hazardous substances followingthe Regulations on Safe Management of Hazardous Chemicals in China, EU RoHS Directive, EU REACH Regu-lation, and other laws and regulations in the places of operation.The company manages the importation, procurement, transportation, loading & unloading, warehousing,storage, issuance, requisition, use, and disposal of hazardous chemicals based on the Chemical ManagementProcedure and the ISC Hazardous Chemicals Management Standards, with the goal of "zero chemical safetyincidents". Before importing hazardous chemicals, the R&D Department must provide the Material SafetyData Sheet (MSDS) to the EHS Department for review. The company requires suppliers to comply with thespeci?cations for the use of materials, the incoming materials to meet the requirements of environmental andsafety supervision authorities, and the use of dedicated vehicles to ensure the safety of transportation. At the
GHG ManagementThe company is committed to jointly promoting the green and low-carbon transformation of the supply chainwith our partners. At the 2023 Supplier Conference, we clearly communicated the company's "2850" and"3030" goals to our supply partners, and launched the "Carbon Reduction Leading 3030" initiative in responseto the target of "reducing the GHG intensity of our major suppliers by 30% by 2030 compared to 2021". In 2023,the company simultaneously revised and updated the INOVANCE Supplier Management Contract, supple-menting and re?ning the management content and requirements for green and low-carbon development inaddition to existing requirements related to Environmental, Social, and Human Rights aspects. During thereporting period, the company completed a directional information collection on GHG emissions for suppliersincluded in the evaluation.
Responsible SourcingAs a responsible listed company, INOVANCE actively implements responsible sourcing behavior and hasintegrated ESG into our daily sourcing management, aiming to strengthen compliance operation, encouragesuppliers' ESG practice and standardize trading behavior.Con?ict Minerals ManagementThe Company has issued the Measures for Control and Management of INOVANCE Con?ict Minerals explicitlycommitted to not using 3TG (Gold, Tantalum, Tungsten and Tin) produced in con?ict mineral areas such asCongo and its surrounding countries and regions. The INOVANCE Supplier Management Contract states thatour products comply with the Con?ict-Free Sourcing Initiative (CFSI), prohibiting suppliers from providing
Launching Ceremony of "Carbon Reduction Leading 3030" Initiative at INOVANCE’s 2023 Supplier Conference
Supplier AdmissionThe company has incorporated EHS andCSR assessment standards into thesupplier admission assessment. During thereporting period, 100% of the 231 newsuppliers completed ESG informationcollection and admission audits.New Suppliers are required to sign theINOVANCE Supplier ManagementContract and the INOVANCE HonestCooperation Agreement. During thereporting period, all new suppliers havesigned both agreements.Supplier Audit
INOVANCE conducts annual assessmentsand on-site audits of suppliers in terms ofEnvironment, Health and Safety, BusinessEthics and Corporate Social Responsibility.In 2023, INOVANCE introduced "Low-car-bon Management" as an additional scoringcriterion for supplier evaluations, aiming toencourage suppliers to conduct GHGinventory, energy ecient utilization, andcarbon reduction initiatives.
Supplier Maintenance
The company invites suppliers tocontinuously improve and supplement ESGinformation, including but not limited to14 categories of information such asgreenhouse gas emissions, energyconsumption, water consumption andrenewable energy utilization. During thereporting period, the invitation rate ofINOVANCE to improve ESG information ofimportant suppliers reached 100%.In cases where the type of collaborationwith a supplier is upgraded fromsingle-category to multi-category materialcooperation, INOVANCE will conduct are-evaluation of the ESG information forsuch suppliers and invite them to provideadditional information.
Supplier Performance
Improvementhe company conducts managementassessments on the top 80% of suppliers ofthe headquarters' procurement amountand all suppliers under the subsidiaryINOVANCE Automotive (the assessmentincludes the dimension of green andlow-carbon development), and issuesassessment reports for the items of thesuppliers that do not comply with theassessment criteria, and supports them tocontinuously improve the relevantperformance.The company regularly organizes ESGEmpowerment Training activities forsuppliers to support the development oftheir ESG capabilities. During the reportingperiod, INOVANCE has conducted 2supplier ESG training sessions, whichincluded green supply chain, "dual carbon"and anti-corruption.
Supplier phase out
The company ends the relationship withsuppliers who engaged in signi?cant illegalactivities or behaviors that seriously affectthe operation and management ofINOVANCE. Behaviors that seriously affectthe management of INOVANCE includebut not limited to major supply accidents,major quality issues, leakage of con?dentialinformation incidents, major securityaccidents, and violations of business ethics,which cause business interruptions, assetlosses, threats to personal safety, anddamage to reputation.
con?ict minerals or their derivatives sourced from con?ict-affected regions mentioned above. The Company'sproduction process involves the use of gold (Au) and tin (Sn) mineral resources. During the reporting period,the company conducted con?ict minerals investigations on suppliers providing these 2 types of minerals anddid not ?nd any suppliers using con?ict minerals. The proportion of relevant mineral suppliers that have signedthe Con?ict-Free Minerals Commitment reached 100%.
Ethical Business PracticesThe company advocates Transparent Procurement and Integrity Transactions, requiring suppliers to abide bybusiness ethics and eliminate any illegal and irregular business behavior. INOVANCE regularly conducts suppli-er training and dissemination of business ethics every year. In the 2023 Supplier Conference, the companyconducted special policy brie?ngs and training sessions for suppliers on integrity, compliance, and businessethics. During the reporting period, there were no instances of suppliers being removed from INOVANCE'ssupply chain due to major ethical violations or safety accidents. All the new suppliers completed the signing ofthe INOVANCE Honest Cooperation Agreement.
Local Sourcing
To further enhance supply chain resilience and promote local economic development, INOVANCE has adoptedstrategies of "Local Development", "Supplier Relocation" and "Globalized Supply".From 2024, the company plans to intensify efforts to develop local suppliers and continuously increase theproportion of localized sourcing. According to the construction process of production bases, the company willguide the relocation of suppliers to ensure the continuity of local supply. Additionally, as the pace of goingglobal accelerates, INOVANCE will lay out a globalized supply chain to further enhance the resilience of the
8.2 Promoting Industrial Cooperation and Development
“Advancing industrial technology for a better world” is the vision of INOVANCE. The realization of this visionrelies on comprehensive communication and collaboration throughout the industrial chain, as well as on tech-nological innovation, talent exchange and wisdom sharing among industry ecosystem partners. In 2023,INOVANCE continued to strengthen industrial ecosystem cooperation, enhancing the company's collaborativecapabilities throughout the industry chain, and working together with ecosystem partners to promote sustain-able development of the industry.Industrial Ecosystem Collaboration StrategyINOVANCE ecosystem's industrial ecosystem collaboration is coordinated by the Department of EcosystemStrategic Development in collaboration with various departments. In 2023, INOVANCE focused on integratingindustry and education, organizing events, integrating industry and research, building a talent ecosystem andtraining empowerment as key areas, triggering extensive knowledge and talent exchange within the ecosys-tem through the combination of online and oine activities, leveraging the synergy between industry, educa-tion, and research at INOVANCE, enhancing the cohesion of the industrial ecosystem, and promoting thewin-win cooperation within the industry ecosystem.
Key Industry Collaboration and Exchange Cases of 2023
INOVANCE Industrial Ecosystem Collaboration Strategy
Industry-Education Integration
Integrating industry cases and experience into theteaching curriculum of colleges and universities,providing a professional talent pool for the workforceand meeting industry demands.
Event Organization
Taking into account the development trend of ourown and our customers' industries, we host innovative competitions targeted at universities and technical colleges.
Industry-Research Integration
Co-creating solutions with multiple core customers,establishing joint laboratories with suppliers andindustry partners, engaging in research cooperationwith several universities and establishing joint laboratories to tackle cutting-edge technologies.
Training Empowerment
Providing operational and management experienceempowerment training for ecosystem partners.
Talent Ecosystem Development
Collaborating with ecosystem enterprises to conductspecialized talent recruitment events, and establishing employment and internship bases in partnershipwith universities to cultivate industry talents.
In May 2023, the signing ceremony of the strategiccooperation agreement between INOVANCE andYanshan University, as well as the inaugurationceremony of the "Yanshan University-INOVANCEIndustrial Intelligent Control Modern IndustryInstitute" was held at Yanshan University. Both sidesaim to deepen the integration of industry, educationand research, accelerate the integration of theindustrial chain, innovation chain and talent chain,
INOVANCE and Yanshan University Achieved Strategic Cooperation
The Signing Ceremony between INOVANCE andYanshan University
Industry-Education Integration
supplier admission stage, the Procurement Center must review the supplier's quali?cations for the production,transportation, and disposal of hazardous chemicals and waste water, gas and solid waste treatment, while theSQE reviews suppliers' clear labels, control procedures and storage environments for ?ammable, corrosive andtoxic chemicals. During the reporting period, 100% of key suppliers passed the review of hazardous chemicalsmanagement and RoHS compliance.In response to RoHS 2.0, the company conducts assessments and audits for hazardous substances in theSupplier Survey Report (SSR), Supplier Quality Process Audit (QPA), and Incoming Quality Control (IQC) on amonthly and quarterly basis. We have RoHS testing equipment that enables direct testing of hazardoussubstances in incoming materials.
promote the training of industrial technology professionals and scienti?c and technological innova-tion, and deliver high-quality talents for the domestic industrial control industry upstream anddownstream.
INOVANCE Cup National Innovation Competition for Intelligent Automation
Event Organization
INOVANCE Ecosystem Talent Recruitment Event
INOVANCE Ecosystem Talent Recruitment Event
Talent Development
In 2023, INOVANCE established the INOVANCEEcosystem Talent Recruitment Event,collaborating with industry ecosystem partnerssuch as clients and distributors to conductrecruitment activities in colleges and universities.We are committed to providing students recruitedduring the event with a two-month technicaltraining program, helping them to better bridgethe gap between university education and indus-try practices, enhancing the technical capabilities of downstream enterprises, and providingquali?ed and professional talent supply for ecosystem partners. Together with ecosystementerprises, INOVANCE offered about 100 employment opportunities for college graduates
INOVANCE Speaks on Industrial AutomationINOVANCE Planet
The company has launched short video accounts called "INOVANCE Speaks on IndustrialAutomation" and "INOVANCE Planet Platform" to popularize knowledge about the IndustrialAutomation Industry to the general public. By the end of 2023, the two short video accountshave released 35 short videos on industrial science popularization, with 50,000 followers andmore than 4 million views. In September 2023, the company ocially launched the "INO-VANCE Planet" platform, which offers about 700 courses on industrial automation knowl-edge. This platform provides industry knowledge and professional courses for practitioners,enthusiasts, and students majoring in related ?elds, with the total course views surpassing100,000 times.
Popular Science in Industrial Automation Industry
Training Empowerment:INOVANCE Online and Oine Industrial Empowerment
In January 2023, INOVANCE signed a strategiccooperation agreement with East China Engineer-ing Science and Technology Co., Ltd. (referred to as“ECEC”) and Anhui Jiaotai Intelligent TechnologyCo. Ltd.(referred to as “Jiaotai”) in Hefei, and thethree companies will work together to carry outin-depth cooperation in the ?eld of automationand digitalization in the chemical industry.INOVANCE has rich experience and technologicalexpertise in the research and development of large
INOVANCE together with ECEC and Jiaotai to Develop High-Power Inverter Equipment
The signing of the strategic cooperation agreementbetween INOVANCE, ECEC and Jiaotaipower rating AC drives. ECEC has many application and years of experience in chemicalindustry, and Jiaotai has demonstrated outstanding performance in predictive maintenancedigital solutions. Therefore, this collaboration is expected to leverage the strengths of the threecompanies to tackle the industry's technical challenges, optimize designs, and jointly develophigh-performance, high-stability and high-reliability equipment with ultra-large-power-ratingAC drive, to build a new pattern of ecient, green and safe development of the chemicalindustry.
Industry-Research Integration
The ?rst INOVANCE Cup National Innovation Competition for Intelligent Automation wasocially launched in December 2023. This competition is hosted by the Chinese Association ofAutomation and organized by INOVANCE, which is an exploratory engineering innovation com-petition for students from universities and technical colleges nationwide in the industrial ?eld.The competition features four themes: "Intelligence (Industrial Arti?cial Intelligence)," "Green-ing (Green Manufacturing)," "Digitalization (Construction of Industrial Internet of ThingsSystems)," and "Automation (Implementation of Automated Production Line Upgrades)," aimsto guide the industrial automation talents in universities to pay attention to industrial trends,closely integrate engineering education with industrial practices, improve the ability of innova-tive design, solving complex engineering problems, and stimulate green & intelligent innova-tive solutions. Ultimately, the competition seeks to contribute to the collaborative educationand innovation between industry, education, and research. Over 400 teams from more than 100universities have registered for the competition, which is scheduled to conclude in July of thefollowing year.
The First INOVANCE Cup National Innovation Competiton for Intelligent Automation
8.3 Contributing to Social Development
8.3.1 Community Communication and Volunteer Service
INOVANCE actively participates in community construction and ful?lls our corporate social responsibility bycreating a community-enterprise linkage platform. We encourage employees to engage in communityvolunteer services,taking volunteer service as a bridge of community communication and contributing to theconstruction of a harmonious and livable community. During the reporting period, the cumulative servicetime of registered volunteers from the Employee Volunteer Association participating in public health-relatedvolunteer services exceeded 5,600 hours, with more than 800 person-times.In 2023, the Company actively responded to the calls from the local government and relevant departmentsand focused on the theme of Green and Environmentally Friendly Practices and Resource Reuse for innova-tion in public welfare services. Led by the INOVANCE Employee Volunteer Association, with the residents ofthe Taihu Street community as the service objects, the company launched the "Gathering New Force, Green-ing the Land" environmental empowerment for community public welfare innovation service.
INOVANCE actively undertakes social responsibility, responds to the needs of social public services, andsupports social public welfare and charity activities with practical actions. In 2023, the company conducted aseries of activities including assisting education in poor mountainous areas and organizing environmentalprotection hiking events.
8.3.2 Social welfare and Charity Initiatives
In order to help the poor students in the mountainousareas of Yunnan and Guizhou to alleviate their ?nancialpressure and complete their studies successfully, theSuzhou INOVANCE Volunteer Association and the YixinPublic Welfare Society in Suzhou Industrial Park jointlysponsored 15 students in the form of scholarships forfamilies under special diculties in the mountainous areas.
Education Support to Ful?ll Dreams in the Mountainous Areas of Yunnan and Guizhou
Group photo of volunteers and sponsored students
Environmental Protection Activities in Suzhou Lingyan Mountain
A snapshot of the Lingyan MountainEnvironmental Protection Activity
In October 2023, the INOVANCE Volunteer Associationinitiated the Lingyan Mountain Clean-up activity, more than40 volunteers participated in this activity. Along the hikingtrails, volunteers picked up the garbage left by tourists,actively practicing environmental protection and promotingthe concept of caring for nature.
For details of the Empowerment of Management Talent in the Ecosystem, please refer to chapter 7.3.1 Employee Training System.
The company has established 5 industrytraining bases in East China and South China,aiming to provide professional technicalempowerment for technical personnel in theecosystem. Among them, the INOVANCEEngineer Empowerment Training Camp (IET)jointly launched by the General AutomationDivision and INOVANCE Academy, had 300
Communications & Empowerments with Professionals
INOVANCE Developer Conference (Dongguan)
"Gathering New Force, Greening the Land" Environmental Empowerment for CommunityPublic Welfare Innovation Service
INOVANCE Environmental Knowledge ContestINOVANCE volunteers conducted a communityenvironmental protection knowledge contestbased on environmental protection knowledgein the popularization classroom, selectedcommunity youth environmental protectionambassadors, and encouraged communityresidents to actively engage in environmentalprotection actions.
"Heart and Power" Achievement Exhibition
During the achievement exhibition,INOVANCE volunteers demonstrated theprocess of garbage recycling and reusing tocommunity residents in the form of videosand PowerPoint, and utilized the power ofthe enterprise to contribute to the creation ofa favorable ecological environment atmo-sphere in the district.
participants in 2023. In the future, thecompany plans to advance the construction of industry training bases in Central China andNorth China.The company has set up a specialized technical exchange platform for industryengineers called the INOVANCE Developer Conference. Through face-to-face oine interac-tions and sharing, open technical cooperation and mutual experiences to discuss importantsoftware technologies and trends in the industry. In 2023, INOVANCE held 2 Developer Confer-ences, with approximately 400 participants engaging in conference exchanges.
"Gathering New Force, Greening the Land" Environmental Empowerment for CommunityPublic Welfare Innovation Service
"Gathering New Force" Ecological and Environ-mental Protection Science PopularizationClassroom
The purpose of the classroom is to popularizeenvironmental protection knowledge amongchildren and teenagers in the communitythrough lectures and hands-on experiencesbased on different environmental protectionthemes and to guide children and teenagers topay attention to environmental issues and raiseawareness about environmental issues.
"Gathering Aspires as One"Beverage BottleRecycling Program
Volunteers from INOVANCE initiated therecycling of beverage bottles. After recycling,the discarded beverage bottles were recycledand reused. The company collaborated on therecycling and disposal process.
Suzhou INOVANCE Volunteer Association launched a bookdonation initiative within the company and in SuzhouIndustrial Park, encouraging the donation of idle books topromote book recycling. In June 2023, representatives of theINOVANCE volunteers and philanthropists from the YixinPublic Welfare Society in Suzhou Industrial Park, broughtover 4,000 donated books to Xin Cun Elementary School inManwan Town, Yunxian County, Lincang City, YunnanProvince, for oine donation. They presented the books andgifts to local students for Children's Day and simultaneouslyvisited other elementary schools to understand the local needs.
Volunteer representatives distributed Children's Daygifts to local elementary school students
The "Caring for Education" Campaign in Lincang, Yunnan
Suzhou INOVANCE participated in the "Hundred WesternCaring Library" project initiated by the Kind-City PublicWelfare Federation in Suzhou Industrial Park and established"INOVANCE Caring Library" in Zisong Elementary School ofYaxiaji Town, Lintao County, Dingxi City, Gansu Province. Thelibrary was delivered in September 2023.
The Caring Library in Lintao County, Gansu Province
A corner of the INOVANCE Caring Library
INOVANCE actively participates in public welfare charity andful?lls corporate social responsibility. Suzhou INOVANCEcontributed to the modernization of Wuzhong Taihu NewTown in Suzhou, which has earned widespread praise fromthe government and society, and won the honorary title of"Wuzhong Charity Award" for the most caring donationenterprise in 2023.
Won the "Wuzhong Charity Award" in 2023
Suzhou INOVANCE "Wuzhong CharityAward" Certi?cate of Recognition
Appendix 1: ESG Key Performance TableAppendix 2: Index TableAppendix 3: GlossaryAppendix 4: Material Topics of High Impact in 2023Appendix 5: Reader's Feedback Survey
REPORT APPENDIX
Appendix 1: ESG Key Performance TableAppendix 1: ESG Key Performance Table
1.Economic Performance [1]
Performance Indicators of this year are disclosed according to the organizational scope ofthe consolidated ?nancial reports. The statistics of some performance indicators are incon-sistent with the indicators disclosed last year. To facilitate stakeholders' understanding andcomparison of indicators, invalid data due to changes in statistical caliber over the years areusing " / " to replace.
202120222023
million RMBmillion RMB%million RMB%%million RMBRMB per sharemillion RMB%million RMBmillion RMB%million RMBmillion RMB%million RMB
30,419.93
32.21
1.78
4,741.86
9.77
48,957.56
21.66
16,358.114,856.49
1.85
147.14
RevenueCategorized by Market Segmentation of Revenue Domestic Revenue Proportion of Domestic Revenue Proportion of Overseas Revenue Proportion of Overseas RevenueGrowth Rate of RevenueOperating CostsBasic EPSNet Pro?t Attributable to Shareholders of the Listed CompanyNet pro?t Attributable to Shareholders of the Listed CompanyNet Cash Flow from Operating ActivitiesTotal AssetsWeighted Average ROERetained EarningsTotal Expenses for Employee Salaries and Bene?tsHuman Capital Return on Investment [2]Financial Assistance Received from Government
23,008.3122,123.02
96.15
885.29
3.85
28.23
19,783.51
1.64
4,319.76
20.89
3,200.8339,211.61
24.31
12,573.873,962.80
1.81
153.84
17,943.2617,326.18
96.56
617.08
3.44
55.87
15,152.79
1.37
3,573.40
70.15
1,766.0227,303.26
27.35
9,044.172,805.30
1.99
121.42
IndicatorsUnits
[1] Economic performance data can be found corresponding ?gures in the annual ?nancial reports of 2023, 2022 and 2021. If anydata difference occurs, the data in the annual ?nancial reports shall prevail.[2] Human Capital Return on Investment = [Revenue-(Operating Costs-Total Expenses for Employee Salaries and Bene?ts)]/TotalExpenses for Employee Salaries and Bene?ts
2.Environmental Performance Table
202120222023IndicatorsUnits
tCO2etCO2etCO2etCO2etCO2etCO2etCO2etCO2e per million RMB
1,006,842.551,807.90121,345.34883,727.50862,930.0920,797.4110,748,527
4.05
81,410.281,601.9079,808.38////
3.52
64,938.65
1,933.36
63,005.29
/
/
/
/
3.62
Total GHG Emissions [1]Scope 1 GHG Emissions [2]Scope 2 GHG Emissions [3]Scope 3 GHG Emissions [4]Scope 3 Upstream Emissions [5]Scope 3 Downstream Emissions [6]Scope 4 Avoided GHG EmissionsGHG Emission (Scope 1 + Scope 2) Intensity
GHG Emissions
Notes:
[1] The total GHG emissions in 2023 include Scope 1, Scope 2, and Scope 3 emissions. The increase in total GHG emissions in 2023is attributed to the increase of energy consumption brought by the Company's organic growth and capacity expansion. The mainreasons for the increase in GHG emission intensity in 2023 are: The newly built factories and oce spaces such as ChangzhouINOVANCE New Energy and Yueyang INOVANCE were put into use in 2023, and the newly-increased basic energy consumption(referring to the minimum energy consumption required to maintain the normal operation of the factory or oces, which showslittle correlation to production capacity or regional occupancy) is relatively large; The construction progress of distributed photo-voltaics in the two factory Changzhou INOVANCE New Energy and Yueyang INOVANCE fell behind expectations, and the gridconnection has not been completed in 2023. The total GHG emissions in 2022 and 2021 only include Scope 1 and Scope 2.[2] Referring to ISO 14064-1: 2018, 2006 IPCC Guidelines for Naonal Greenhouse Gas Inventory and General guideline of the greenhouse gas emissionsaccounng and reporng for industrial enterprises (GB/T 32150-2015), including ?xed combustion emissions from cooking equipment andmobile combustion emissions from self-owned vehicles for business use, forklifts, and operating lease vehicles; The company doesnot involve industrial process emissions or signi?cant fugitive emissions. The categories of GHG emissions included in the calcula-tion is CO2. The calculation of calori?c value and carbon oxidation rate in the emission factors refers to the corresponding defaultvalues in the Guidelines for Accounng and Reporng Methods of Greenhouse Gas Emissions from Other Industrial Enterprises (Trial) (2015), and theUnit Heat Value Carbon Content (UHVCC) refers to 2006 IPCC Guidelines for Naonal Greenhouse Gas Inventory.[3] Referring to ISO 14064-1: 2018 and General guideline of the greenhouse gas emissions accounng and reporng for industrial enterprises(GB/T 32150-2015) for the calculation of indirect emissions from purchased electricity and steam. The categories of GHGemissions included in the calculation is CO2. When calculating the emissions from purchased electricity of the year 2023,emission factor selected for the domestic operational sites is in accordance with the Noce on the Management of GHG EmissionReporng of Enterprises in the Power Generaon Industry from 2023 to 2025 (2023) and used 0.5703 tCO2e/MWh. Emission factors select-ed for the overseas operational sites are in accordance with the corresponding electricity emission factors of different coun-tries in 2021 provided by Climate Transparency.[4] Referring to ISO 14064-1: 2018 and General guideline of the greenhouse gas emissions accounng and reporng for industrial enterprises (GB/T32150-2015), Scope 3 emissions include: indirect emissions from transportation (upstream raw material transportation, down-stream goods distribution, waste transportation, employee commuting, etc.); Indirect emissions from products or services of theCompany (upstream production of raw materials, water, electricity, gas, waste disposal, business travel, etc.).[5] The scope of upstream emissions include purchased goods & services, capital good, fuel- and energy-related activities,upstream transportation and distribution, waste generated in operations, business travel, and employee commuting. Theemission factors refer to UK Government GHG Conversion Factors for Company Reporng.[6] Downstream emissions under Scope 3 here only include downstream distribution and transportation.
28,680.11
94.28
1,739.82
5.72
26,278.78
3,369.92
Domestic RevenueOverseas Revenue
20212022
/
329.50
///
824.50
//64,959.00
37.66
2.65
0.32
5.73
3.13
0.02
36.25
412.00
//////////
648.00
//
/////
720.00
//22,213.00
17.86
1.21
0.17
3.14
1.68
0.02
18.35
313.00
//////////
478.00
//
202120222023IndicatorsUnits
Energy Management
Total Energy ConsumptionTotal Non-Renewable Energy ConsumptionProportion of Eletricity Generated by Renewable EnergyTotal Direct Energy ConsumptionNatural Gas ConsumptionLique?ed Petroleum Gas ConsumptionTotal Indirect Energy ConsumptionPurchased ElectricityEletricity Generated by Solar PowerTotal Energy Consumption IntensityDirect Energy Consumption IntensityIndirect Energy Consumption IntensityEstimated Energy Consumption [6]
MWhMWh%MWhm
LMWhMWhMWhMWh per million RMBMWh per million RMBMWh per million RMBkWh
231,859.61223,117.28
3.77
8,469.42461,655.2286,416.17223,390.20208,016.018,740.50
7.63
0.28
7.35
1,964,500.00
149,238.00//4,118.00317,129.0091,442.00145,120.00139,941.005,179.00
6.49
0.18
6.31
/
117,551.00
/
/
4,698.00
350,336.00
120,828.00
112,853.00
108,045.00
4,808.00
6.55
0.26
6.29
/Notes:
[6] Estimated energy consumption from the energy conservation and carbon reduction projects in 2023.
202120222023IndicatorsUnits
Water Resource Use
Total Water WithdrawalTotal Water Consumption (Categorized by origins)By the Origins of Water Withdrawal: MunicipalWater SupplyBy the Origins of Water Withdrawal: Directly Collectedand Stored RainwaterWater Withdrawal Intensity
m
m
m
m
1,021,444.28748,134.00999,657.4821,786.80
33.60
605,987.00541,028.00595,987.0010,000.00
26.34
435,580.00
357,570.00
435,580.00
24.28
Emissions and Waste Management [7]
202120222023IndicatorsUnitsResource Use
Total Packaging Material UsageProportion of Energy-Saving, Material-Conserved andCarbon-reduced Product offering
tons%
24,544
49.67
//
//
2023IndicatorsUnits
Atmospheric Pollutant Emissions
Total Waste Gas EmissionsParticulate Matter (PM)Particulate Matter (PM) Emission IntensityNitrogen Oxide (NOx)Nitrogen Oxide (NOx) Emission IntensityVolatile Organic Compounds (VOCs) [7]Volatile Organic Compounds (VOCs) Emission IntensitySewage DischargeTotal Sewage DischargeDomestic Sewage DischargeChemical Oxygen Demand (COD)Ammoniacal NitrogenNH3-NTotal PhosphorusTotal NitrogenAnimal and Vegetable OilsTin and its CompoundsSuspended SolidSolid Waste EmissionsTotal Hazardous Waste [8]Hazardous Waste Emission IntensityTotal Hazardous Waste Recycled/ReusedTotal Hazardous Waste DisposalHazardous Waste Reduction GoalTotal Hazardous Waste Disposed by Lan?llTotal Hazardous Waste Incinerated with Energy RecoveryTotal Hazardous Waste Incinerated without Energy RecoveryTotal Hazardous Waste Used Other MethodsTotal Hazardous Waste With Unknown Disposal MethodToxic Emission and Leakage IncidentsTotal Non-hazardous WasteNon-hazardous Waste Emission IntensityTotal Waste Recycled
m
kgkg per million RMB Revenuekgkg per million RMB Revenuekgkg/1 million RMB Revenuem
m
tonstonstonstonstonstonstonstonstons/1 million RMB Revenuetonstons%tonstonstonstonstonstimestonstons/ million RMB revenuetons
1,097,885,202.12
199.67
0.0001
1,160.09
0.0004
6,969.50
0.229
273,310.09228,155.05
114.17
7.81
0.62
9.86
4.63
0.03
50.00
694.62
0.023
67.41
627.22
0.5
53.30
522.38
23.91
769.80
0.025
605.59
20222021
m
per million RMB
2021
/
/
Notes:
[7] The statistical caliber and scope of the indicators included in emissions and waste management have been expanded in 2023,resulting in the data for 2023 not being comparable with the previous years. In this case, data from previous years is not disclosed.[8] The Hazardous Waste reported by the Company includes waste organic solvents, waste packaging containers, waste wipesand gloves, surface treatment waste, waste grinding sludge, waste emulsions and other hazardous wastes listed in the NaonalHazardous Waste List, while the Non-hazardous Waste includes waste paper skin, waste wood pallet, waste copper, waste iron, wastealuminum, waste plastic bags, etc.
Notes:
[1] Proportion of Products Sold or Shipped that Have Been Recalled for Safety and Health Issues = Amount of Sales for ProductsSold or Shipped that Have Been Recalled for Safety and Health Issues (RMB 10,000) / Total Sales (RMB 10,000) x 100%[2] Complaints include customer complaints in written forms and customer complaints through the reporting channels ofgovernment agencies.[3] Proportion of Online Sales = Revenue Generated by Online Sales (Excluded Order Management System) / Total Revenue (RMB10,000) x 100%. In 2023, the Company ?rst launched online stores which is still at the initial phrase thus proportion of online salesremains relatively small.[4] The 2023 annual customer satisfaction survey was conducted by a third-party agency. The survey methods, content, targetcustomers and scores were signi?cantly different from the self-conducted survey in the previous years. To avoid any confusion ofreaders, the scores of customer satisfaction survey in the previous year are not disclosed.[5] Proportion of Product Revenue from Con?ict-Affected and High-Risk Areas = Product Revenue from Con?ict-Affected andHigh-Risk Areas (RMB 10,000) / Total Revenue (RMB 10,000) x 100%.
202120222023IndicatorsUnitsEnvironmental Management
Proportion of Operational Sites that Have BeenConducted Environmetnal Risk AssessmentTotal Environmental Protection Training DurationNumber of Employees Participating in EnvironmentalProtection TrainingProportion of Employees Participating in EnvironmentalProtection TrainingTotal Investments of Environmental Protection Duringthe Reporting PeriodNumber of Key Operational Sites Certi?ed ISO 14001Number of Operational Sites Certi?ed/Audited/Veri?edEnvironment Management System (EMS) by Third-PartyProfessional CompaniesNumber of Operational Sites Certi?ed/Audited/Veri?edInternal Environment Management System(EMS) by Internal ExpertsNumber of Penalities Caused by Violations ofEnvironmental Protection Laws and RegulationsTotal Fine Payment Caused by Violations ofEnvironmental Protection Laws and Regulations
%hourspersons%million RMB////million RMB
7,439.003,134
12.08
6.02
//////////
/
/
/
/
/
/
/
/
/
/
20222023IndicatorsUnits
Products and Services
Number of Product and Service Incidents Caused byViolations of Laws and RegulationsAmount of Revenue for Products Sold or Shipped thatHave Been Recalled for Safety and Health IssuesProportion of Products Sold or Shipped that Have BeenRecalled for Safety and Health IssuesNumber of Product and Service Complaints ReceivedComplaint Resolution RateProportion of Online Sales[3]Total Number of Customer Privacy Incidents ViolatedLaws and RegulationsTotal Number of Safety and Health Incidents of Productsand Services Violated Laws and RegulationsCustomer Satisfaction Score [4]Number of Labeling Incidents of Products and ServicesViolated Laws and RegulationsNumber of Marketing and Communications IncidentsViolated Laws and RegulationsProportion of Product Revenue from Con?ict-Affected and High-Risk Areas [5]
/million RMB%/%%//points//%
millionnth
69.75
/
/
3.Social Performance Table
2021
202120222023IndicatorsUnits
R&D Innovations
R&D InvestmentProportion of R&D Investment [1]Total Number of R&D PersonnelProportion of R&D Personnel [2]
million RMB%persons%
2624.15
8.63
5,482
23.15
2,229.27
9.69
4,793
23.66
1,685.46
9.39
3,560
21.02
Notes[1] Proportion of R&D Investment = R&D Investment (RMB 10,000) / Revenue (RMB 10,000) × 100%; here, the coverage of revenueis consistent with that of the Consolidated Financial Report.[2] Proportion of R&D Personnel = Total Number of R&D Personnel / Total Number of Employees x 100%; here, the scope of "TotalNumber of Employees" is consistent with that of the Consolidated Financial Report.
20222023IndicatorsUnits
Intellectual Property Protection
Number of New Patents Application During the Reporting PeriodNumber of New Patents Granted During the Reporting PeriodNumber of New Trademarks Application During the Reporting PeriodNumber of New Trademarks Approved During the Reporting PeriodNumber of New Copyrights Application During the Reporting PeriodNumber of New Copyrights Approved During the Reporting Period
//////
//
//
2021
20222023Units
Information Security
Number of Recognized Information Security IncidentsNumber of Information Security VulnerabilitiesNumber of Affected Customers and Employees by Violated InformationSecurity BehaviorsNumber of Key Operational Sites Certi?ed ISO 27001
//persons/
1,955
////
////
2021Indicators
20222023Units
Employee Recruitment
Total Number of Employees
Proportion of Employees by GenderProportion of Female EmployeesProportion of Male EmployeesAverage Pro?ts of EmployeesProportion of Employees by Employement TypeFull-time EmployeesFull-time ContractorsPart-time Employees (Internship, Apprentices, WorkingStudents and Retired Employees Rehired in total)Proportion of Part-time EmployeesProportion of ContractorsProportion of Part-time Employees and ContractorsProportion of Full-time Employees
Proportion of Employees by Age
Number of Employees Above 50 Years OldNumber of Employees Between 30 and 50 Years OldNumber of Employees Under 30 Years OldProportion of Employees Above 50 Years OldProportion of Employees Between 30 and 50 Years OldProportion of Employees Under 30 Years Old
Proportion of Employees by EducationNumber of Employees with Doctor's DegreeNumber of Employees with Master's DegreeNumber of Employees with Bachelor's DegreeNumber of Employees with College Diploma and BelowProportion of Employees with Doctor's DegreeProportion of Employees with Master's DegreeProportion of Employees with Bachelor's DegreeProportion of Employees with College Diploma and BelowProportion of Employees from Minority or/and theDisadvantaged Group [1]Proportion of Employees from Minority or/and VulnerableGroup Undertaking Senior Executives PositionsNumber of Non-Chinese-Citizen Employees
persons%%million RMBpersonspersonspersons%%%%personspersonspersons%%%personspersonspersonspersons%%%%%%persons
25,487
26.19
73.81
0.19
23,6851,420
1.50
5.57
7.07
92.93
13,42211,748
1.24
52.66
46.09
3,3957,88014,154
0.23
13.32
30.92
55.53
7.91
20,256///20,256////////////
2,5056,29711,402
0.26
12.37
31.09
56.29
///
16,938///16,938////////////
1,7084,91110,284
0.21
10.08
28.99
60.72
///
2021Indicators
//
/
Proportion of Newly-Recruited Employees by Gender[2]
Total Number of Newly-Recruited EmployeesNumber of Newly-Recruited Male EmployeesNumber of Newly-Recruited Female Employees
Newly-Recruited Employees by Age
Number of Newly-Recruited Employees Above 50 Years OldNumber of Newly-Recruited Employees Between 30 and50 Years OldNumber of Newly-Recruited Employees Under 30 Years OldProportion of Newly-Recruited Employees by Gender [2]Number of Newly-Recruited Male EmployeesNumber of Newly-Recruited Female EmployeesProportion of Newly-Recruited Employees by Age [3]Proportion of Newly-Recruited Employees Above 50 Years OldProportion of Newly-Recruited Employees Between 30 and50 Years OldProportion of Newly-Recruited Employees Under 30 Years OldProportion of Internal Employment [4]Signing Rate of Employment ContractEmployee Turnover Rate [5]Employee Voluntary Turnover RateTurnover Rate by Gender [6]Male Employee Turnover RateFemale Employee Turnover Rate
Turnover Rate by Age [7]Turnover Rate of Employees Above 50 Years OldTurnover Rate of Employees Between 30 and 50 Years OldTurnover Rate of Employees Under 30 Years OldProportion of Female Employees at Junior-level ManagementPositions [8]Proportion of Female Employees at Middle-level ManagementPositionsProportion of Female Employees at Senior-level ManagementPositionsProportion of Female Employees at Executives PositionsProportion of Female Employees at Revenue GeneratingPositions
Employee Recruitment
personspersonspersonspersonspersonspersons%%%%%%%%%%%%%%%%%%%
%%%%/
9.90
27.50
98.48
//
/
8,9956,7232,272
3,1495,829
35.74
34.03
5.36
23.46
49.62
12.66
24.42
23.79
23.73
26.36
12.30
20.41
29.32
15.60
14.50
6.60
14.70
15.00
////////////
27.90
///////////
////////////
////////////
20222023Units2021IndicatorsShare of women in STEM-related positionsProportion of Senior Executives Hired from Local Communitiesat Key Operational Sites [14]Proportion of Employees Undertaking Regular Performanceand Career Development Review [15]Percentage of Employees Below Senior Management Levelthat Stock Option Incentive and Long-term Incentive ProgramAppliesNumber of Employment and Labor Incidents Caused byViolations of Laws and Regulations
202220212023UnitsIndicators
Notes:
[1] Minority or/and the Disadvantaged Groups include: ethnic minorities of Chinese nationality, non-Chinese-citizen employees,and employees with disabilities.[2] Percentage of newly-recruited (Female/Male) employees by gender = Number of newly-recruited (Female/Male) EmployeesTotal number of (Female/Male) employees x 100%.[3] Percentage of newly-recruited employees in a certain age group = Number of newly-recruited employees in the age group/To-tal number of employees in the age group×100%[4] Proportion of Internal Employment = Number of internal recruitment / (Number of internal recruitment + Total number of newrecruitment)×100%.[5] Employee turnover rate = Number of employees turnover / Total number of employees x 100%, where the coverage of "totalnumber of employees" is consistent with the scope of consolidated ?nancial statements.[6] Employee turnover rate of a certain gender = Number of employees leaving of that gender / Total number of employees of thatgender×100%.[7] Employee turnover rate of a certain age group = Number of employees leaving in that age group / Total number ofemployees in that age groupx100%.[8] Proportion of female employees at junior-level management positions= Number of female employees at junior-level manage-ment positions / total number of employees at junior-level management positions x 100%, where junior-level management isde?ned as heads of third-level departments and primary organizations.[9] Proportion of female employees at middle-level management positions = Number of female employees at middle-levelmanagement positions / Total number of employees at middle-level management positions x 100%, where middle-levelmanagement positions is de?ned as heads of second-level departments (including deputy positions).[10] Proportion of female employees at senior-level management positions = Number of female employees at senior-levelmanagement positions / Total number of employees at senior-level management positions × 100%, where senior managementis de?ned as the ?rst-level organization of the company, that is, heads of ?rst-level departments, business units, and subsidiaries(including deputy positions).[11] Proportion of female employees at executives positions = Number of female employees at executives positions / Totalnumber of employees at executives positions×100%.[12] Proportion of female employees at revenue generating positions = Number of female employees at revenue-generatingpositions / total number of people in revenue generating positions x 100%, where revenue generating positions are de?ned as:
direct management roles in departments such as sales, or roles that directly contribute to the output of products or services,excluding support functions such as human resources, IT, and legal. It can also be referred to as roles with pro?t and loss responsi-bility.[13] Share of women in STEM-related positions = number of women in STEM-related positions / number of employees in
Notes:
[1] Lost Workday Rate due to Work-related Injury = lost workdays due to work-related injuries X 200,000 / total working hours.[2] Lost-Time Injury Frequency Rate = total number of work-related Incidents that caused working time loss x 1,000,000 / totalworking hourswhere total number of work-related Incidents that caused working time loss is equal to the number of workinjuries.[3] Lost Time Injury Severity Rate = Working days Loss due to Work-related Injury x 1,000 / total working hours.[4] Joint Labor Management Health and Safety Committee refers to the Health and Safety Committee comprising of the Manage-ment team and the workers.[5] Based on the company's management practices, employees on probation are not applicable to regular performance andcareer development appraisals, therefore this data does not include employees on probation.
///%///%%points
89.10
4.45 (out of 5)
/
/
4.47 (out of 5)
/
/
//
20222023Units2021IndicatorsEmployee's Rights
Number of Key Operational Sites Reviewed and AssessedHuman Right Protection PerformanceNumber of Key Own Operational Sites (including joint ventureswhere the company has management control) Reviewed andAssessed Human Right Protection Performance in last 3 yearsNumber of Incidents Due to Violations of Laws and Regulationson Employment & Dismissal, Compensation & Welfare, WorkingTime & Vacation, Equal Opportunities and Anti-DiscriminationPercentage of Employees Participating in Diversity,Discrimination and/or Harassment TrainingTotal Number of Discrimmination IncidentsTotal Number of Discrimination and Harassment Violated Lawsand RegulationsNumber of Labor Disputes [1]Percentage of Employees Covered by Collective BargainingAgreement [2]Proportion of Employees Who Have Formally Elected asEmployee Representatives [3]Results of Employee Satisfaction Survey
Notes:
[1] Includes non-compete restriction.[2] Based on the company's management practices, employees on probation are not applicable to regular performance andcareer development appraisals, therefore this data does not include employees on probation.[3] The number of employees participating in the labor union is the number of employees who have formally elected employeerepresentatives. Therefore, the proportion of employees covered by formally elected employee representatives is equal to thelabor union coverage rate.
Total Working Hours
hourspersonspersonstimesdays///
48,148,855
2,614.50
10.86
0.64
0.05
/
/
1,315.00///personspersons
persons0
38,407
/
40,437
///////////
//
/
/
/
%%
%person-timestimes
20222023Units2021Indicators
Number of Employee Work-related FatalitiesNumber of Contractor Work-related FatalitiesNumber of Work Injury OccurrenceWorking Days Loss due to Work-related InjuryLost Workday Rate due to Work-related Injury [1]Lost-Time Injury Frequency Rate [2]Lost Time Injury Severity Rate [3]Number of Employees at OccupationalDisease Risk PositionsNumber of Newly-increased Employees withOccupational DiseasesNumber of Fatalities with Occupational DiseasesNumber of Operational Sited UndergoneEmployee Health and Safety Risk AssessmentProportion of Workers Represented by Joint LaborManagement Health and Safety Committee [4]Number of Operational Sites Certi?ed ISO 45001Coverage of Employee Health Check-up [5]Amount of Safety Training ParticipantsNumber of Safety Training SessionsCoverage of Social Insurance for EmployeesNumber of Occupational Heath and Safety IncidentsDue to Violations of Laws and Regulations
Occupational Health and Safety
STEM-related positions, where STEM (Science, Technology, Engineering, and Mathematics) workers use their knowledge ofscience, technology,engineering, or mathematics in their daily responsibilities. To be classi?ed as a STEM employee, the employeeshould have a STEM-related quali?cation and make use of these skills in their operational position. Positions include, but are notlimited to, the following: Computer programmer, web developer, statistician, logistician, engineer, physicist, scientist.[14] Proportion of senior executives hired from local communities at key operational sites = number of senior executives hiredfrom local communities at key operational sites / total number of senior executives.[15] Based on the company's management practices, employees on probation are not applicable to regular performance andcareer development appraisals, therefore this data does not include employees on probation.
Coverage of Employee Training
Coverage of Employee Training by Gender [1]Proportion of Female Employees participating in TrainingProportion of Male Employees participating in TrainingTotal Number of Employees Training DurationAverage Employees Training DurationAverage Training Hours of Employees by Gender
Average Training Hours of Female EmployeesAverage Training Hours of Male EmployeesAverage Training Expenses of EmployeesAmount of Employee Personal Information Security TrainingNumber of Employee Personal Information Security Training
Supplier Management
20222023UnitsEmployee Training
%%%hourshourshourshoursRMB
686,347.40
26.93
26.93
26.93
232.89
158,996.00
23.51
23.56
23.50
/
130,245.00
15.00
15.00
15.00
/
Indicators
Notes:
[1] Coverage of employee training of a certain gender = total number of employees of that gender participating in training / totalnumber of employees of that gender x 100%
////
///%//%%%%%/%%%%
////
/////////
///
////
/////////
///
2,5921,5282,552
1,5281,638
Total Number of SuppliersTotal Number of Active Suppliers During the Reporting Period [1]Number of Suppliers from Mainland ChinaNumber of Suppliers from Overseas, Hong Kong, Macau andTaiwan Reigions
Suppliers by Level of Raw Materials
Total Number of Tier-1 Suppliers During the Reporting Period(by material offering type) [2]Total Number of Tier-1 Suppliers During the Reporting Period(by procurement & trading type) [3]Number of Tier-1 Signi?cant Suppliers [4]Percentage of Total Spend on Signi?cant Suppliers in Tier-1Total Number of Signi?cant Suppliers in Non Tier-1 [5]Number of Signi?cant SuppliersSupplier ReviewPercentage of Key Suppliers Assessed [6]Percentage of New Suppliers Under ESG AssessmentPecentage of New Suppliers Under On-Site ESG AssessmentPercentage of Total Revenues from Products ContainingMinerals from Con?ict-Affected and High-Risk Areas Comingfrom Suppliers that Have Been Veri?ed Con?ict-free [7]Percentage of Supplier Accessibility to Con?ict-MineralsInformationNumber of New Suppliers Under ESG AssessmentPercentage of New Suppliers Passed ESG AssessmentPercentage of Suppliers Signed Supplier Code of ConductPercentage of Suppliers Signed Agreements with Environment,Labor and Human Rights ClausesPercentage of Suppliers Signed Anti-Corruption Agreements [8]
20222023Units2021Indicators
timespersons
25,487
13,342
14,460
2021
Supplier's Performance Improvement
Number of Suppliers Failed to Meet Quality StandardAssessment During the Reporting Period"Number of Suppliers Assessed with SubstantialActual/Potential Negative Impacts [9]"Number of Suppliers with Substantial Actual/PotentialNegative Impacts that Were TerminatedTotal Number of Suppliers Supported in Corrective ActionPlan ImplementationPecentage of suppliers assessed with substantialactual/potential negative impacts supported in correctiveaction plan implementationSupplier's GHG InventoryNumber of Key Suppliers Undergone GHG InventroyDuring the Reporting Period [10]Coverage of Key Suppliers Undergone GHG InventroyDuring the Reporting PeriodSupplier Training EmpowermentNumber of Supplier Capacity Building Training During theReporting PeriodCoverage of Supplier Integrity Training and EducationDuring the Reporting Period
////%
/%
/%
/////
//
//
/////
//
//
20222023Units2021Indicators
Distributor Management
Percentage of Distributors Participating Regular InternalProduct and Service Training Among Distribution Network%100100100
20222023Units2021Indicators
Community and Public Charity
20222023Units2021Indicators
Notes:
[1] Active Supplier refers to suppliers that have traded with INOVANCE this year.[2] Tier-1 Supplier (by Material Offering Type) refers to suppliers that provide materials directly to INOVANCE.[3] Tier-1 Supplier (by procument & trading type) refers to suppliers that have directly trade with INOVANCE.[4] Tier-1 Signi?cant Suppliers refers to the Tier-1 Suppliers that provides important materials and has long cooperation historywith the INOVANCE. These Suppliers can ?ll the demand gap of the INOVANCE's development and need to build long-termpartnerships with the Company.[5] Total Number of Signi?cant Suppliers in Non Tier-1 refers to the Supplier that have indirect partnership with INOVANCE andprovide important materials or components of materials indirectly.[6] Key Suppliers refers to the Suppliers offered essential materials to INOVANCE.[7] Percentage of Total Revenues from Products Containing Minerals from Con?ict-Affected and High-Risk Areas Coming fromSuppliers that Have Been Veri?ed Con?ict-free = Total Revenues from Products Containing Minerals from Con?ict-Affected andHigh-Risk Areas Coming from Suppliers that Have Been Veri?ed Con?ict-free(RMB 10,000)/ total revenue(RMB 10,000) x 100%.
Total Amount Invested into Community Public WelfareEducation AssistanceEnvironmental ProtectionLabor NeedsMedical HealthCultural and Sports UndertakingsOther FieldsUse of Charity FundsAmong which, Amount Donated to Charity Projects [1]Total Voluntary Service Duration of Employee VolunteersNumber of Employee Voluntary Service Participants
RMBRMBRMBRMBRMBRMBRMBRMBRMBhourspersons
696,599.27292,000.00
404,599.27145,585.70492,000.005,600
1,460,111.51687,231.91
587,378.61
185,500.99/667,231.9136,460
145,000.00135,000.003,0005,000
2,000//30,000.00
Notes:
[1] Refering to the amount corresponding to the donated project for which a donation receipt has been issued under uniformmonitoring (printing) by the Ministry of Finance.
[8] The Anti-corruption Agreement refers to the Supplier Honest Cooperation Agreement, which speci?cally includes anti-corrup-tion-related content.[9] Substantial Actual/Potential Negative Impacts refers to supply disruption, major product quality issues and other incidentsthat may seriously affect the Company's reputation.[10] Main Supplier refers to the group of suppliers that account for the top 80% of the annual procurement amount, ranked byprocurement amount.
202118,561
1,555//
/
7,612
11,195
/
/
/
/
0.2
202220212023IndicatorsUnitsCompliant Management
Number of Employees Participating in Anti-Corruption RelatedTrainingCoverage of Employees Participating in Anti-Corruption RelatedTrainingTotal Hours of Employees Participating in Anti-CorruptionRelated TrainingNumber of Corruption Clues from Reporting ProceduresNumber of Incidents of Employees Being Dismissed orDisciplined Due to CorruptionNumber of Incidents Violated Laws and RegulationsNumber of Operational Sites Where Anti-Corruption AuditsHave Been Conducted [1]Number of Operational Sites Where Anti-Corruption AuditsHave Been Passed During the Reporting PeriodNumber of Corruption Lawsuits Filed Against the Company orEmployees and Concluded During the Reporting PeriodNumber of Incidents Violated Laws and RegulationsNumber of Fine Payment Due to Laws and Regulatoins ViolationAmount of Fine Payment Due to Laws and Regulatoins ViolationNumber of Major Tax Incidents Violated Laws and RegulationsNumber of Con?ict of Interest Incidents Violated Laws andRegulationsNumber of Money Laundering and Insider Trading IncidentsNumber of Anti-Competitive, Anti-Trust, and Anti-MonopolyRelated Lawsuits that Have Entered Legal Proceedings
persons%hours////////million RMB////
21,382
1,791
Proportion of Government OwnershipNumber of Audit Committee Meetings HeldThe Ratio between the Total Annual Compensation of theCEO and the Mean Employee CompensationNumber of General Meetings HeldNumber of Board of Supervisors Meetings HeldAttendence Rate of Board of Supervisors Meeting
%times/timestimes%
16.44
17.09
23.52
Notes:
[1] Multiple of Base Salary refers to the multiple between stock ownership value and base salary. CEO Multiple of Base Salary =share price at the end of the FY * number of shares held by the CEO / base salary of CEO[2] Other Executives Multiple of Base Salary =(share price at the end of the FY * number of shares held by the executive 1 / basesalary of executive) + (share price at the end of the FY * number of shares held by the executive 2 / base salary of executive) + (...) /number of executives with shareholdings reported
Notes:
[1] Anti-Corruption Audits refers to the audit activity covering a review of corruption behaviors; Operational Sites refers tocorresponding company or subsidies.
202120222023IndicatorsUnitsCorporate Governance
Number of Board of DirectorsNumber of Independent DirectorsNumber of Male Directors Among the Board of DirectorsNumber of Female Directors Among the Board of DirectorsProportion of Female Directors Among the Board of DirectorsNumber of Board Meetings HeldNumber of Average Participants of Board Meeting AttendanceAttendance Rate of Board of Directors MeetingMinimum Attendance Rate for Meetings of Board of DirectorsNumber of Non-Executive/Independent Directors with 4 orLess Other MandatesAverage Tenure of Board MembersNumber of Independent Directors with Industry BackgroundMultiple of CEO's Base Salary [1]Other Executives with Shareholding Reported Multiple ofBase Salary [2]
personspersonspersonspersons%timespersons%%personsyearspersons//
7.67
965,69
713.75
6.67
1,060.94
903.67
5.67
923.17
698.61
4.Governance Performance Table
Appendix 2: Index TableAppendix 2: Index Table
1. Shenzhen Stock Exchange (SZSE) Guidelines of Shenzhen Stock Exchange for Self-discipline Regula-
on of Listed Companies No.2 – Standard Operaon of Listed Companies on ChiNext Board.(Revised in Decem-ber of 2023)
2. Annex I Corporate Social Responsibility Report Disclosure Requirements for Listed Companies, Chapter 1
Secon 2 Maers Related to the Disclosure of Periodic Reports, Guidelines of Shenzhen Stock Exchange forSelf-discipline Regulaon of Listed Companies No.1 - Business Processing.(Revised in December of 2023)
Corresponding Chapter
Chapter 3 Sustainable Corporate GovernanceChapter 3 Sustainable Corporate GovernanceChapter 6 Innovation Drives DevelopmentChapter 3 Sustainable Corporate GovernanceChapter 4 Empowering DecarbonizationChapter 6 Innovation Drives DevelopmentChapter 7 Employee Development GuaranteeChapter 8 Inclusive And Responsible Ecosystem BuildingAbout This ReportChapter 3 Sustainable Corporate GovernanceChapter 4 Empowering DecarbonizationChapter Focus on Customer SatisfactionChapter 6 Innovation Drives DevelopmentChapter 7 Employee Development GuaranteeChapter 8 Inclusive And Responsible Ecosystem BuildingChapter 3 Sustainable Corporate GovernanceChapter 3 Sustainable Corporate GovernanceChapter 3 Sustainable Corporate GovernanceChapter 7 Employee Development GuaranteeChapter 4 Empowering DecarbonizationChapter 8 Inclusive And Responsible Ecosystem BuildingChapter 4 Empowering DecarbonizationChapter 4 Empowering DecarbonizationNot ApplicableChapter 7 Employee Development GuaranteeChapter 7 Employee Development GuaranteeChapter 6 Innovation Drives DevelopmentChapter 3 Sustainable Corporate Governance
9.1
9.2
9.3
9.4
9.5
9.6
9.7
9.8
9.9
9.1
9.11
9.12
9.13
9.14
9.15
Guideline Chapter
Chapter 9Social Responsibility
Clause No.Corresponding ChapterChapter 1Introduction to INOVANCEChapter 3Sustainable Corporate GovernanceChapter 7Employee Development GuaranteeChapter 8Inclusive And Responsible Ecosystem BuildingChapter 4Empowering DecarbonizationChapter 8Inclusive And Responsible Ecosystem BuildingChapter 8Inclusive And Responsible Ecosystem Building
1. Overview
Guideline Chapter
Annex I CorporateSocial ResponsibilityReport DisclosureRequirements forListed Companies
Clause No.
2. Social Responsibility Performance
(1) Shareholder and creditor's rights protection
2. Social Responsibility Performance
(2) Employee's right protection
2. Social Responsibility Performance
(3) Suppliers
2. Social Responsibility Performance
(5) Public Relations and Public Welfare
2. Social Responsibility Performance
(6) Targeted Poverty Reduction
3. Issues and correction Plan of
company undertakingsocial responsibility
4. Companies in the biopharmaceutical
and food & beverage industries shalldisclose product quality managementsystems, after-sales service systems, andthe establishment and implementationof product recall systems.
2. Social Responsibility Performance
(4) Environmental Protection and Sustainable
Development
Chapter 3Sustainable Corporate GovernanceChapter 4Empowering DecarbonizationChapter 5Chapter Focus on Customer SatisfactionChapter 6Innovation Drives DevelopmentChapter 7Employee Development GuaranteeChapter 8Inclusive And Responsible Ecosystem Building
Not Applicable
3. Global Reporting Initiative (GRI) Sustainability Reporting Standards
Location2-1 Organizational details
2-2 Entities included inthe organization’s sustainability reporting
About This ReportChapter 1 Introduction to INOVANCEAbout This ReportAbout This ReportAbout This ReportAppendix 1 ESG Key Performance TableAbout This ReportChapter 1 Introduction to INOVANCEChapter 7 Employee Development GuaranteeAppendix 1 ESG Key Performance TableAppendix 1 ESG Key Performance TableChapter 3 Sustainable Corporate Governance
3.2 Corporate Governance
Chapter 3 Sustainable Corporate Governance
3.2 Corporate Governance
Chapter 3 Sustainable Corporate Governance
3.2 Corporate Governance
Chapter 3 Sustainable Corporate Governance
3.2 Corporate Governance
Chapter 3 Sustainable Corporate Governance
3.2 Corporate Governance
Chapter 3 Sustainable Corporate Governance
3.1 ESG Management
Chapter 3 Sustainable Corporate Governance
3.3 Robust Operation
Chapter 3 Sustainable Corporate Governance
3.2 Corporate Governance
Chapter 3 Sustainable Corporate Governance
3.1 ESG Management
Chapter 3 Sustainable Corporate Governance
3.1 ESG Management
Chapter 3 Sustainable Corporate Governance
3.1 ESG Management
Appendix 1 ESG Key Performance Table
2-3 Reporting period,frequency and contact point2-4 Restatements of information2-6 Activities, value chain and otherbusiness relationships2-7 Employees2-8 Workers who are not employees2-9 Governance structureand composition2-10 Nomination and selection of thehighest governance body2-11 Chair of the highestgovernance body2-12 Role of the highest governance bodyin overseeing the management of impacts2-13 Delegation of responsibility formanaging impacts2-14 Role of the highest governance bodyin sustainability reporting2-15 Con?icts of interest2-16 Communication of critical concerns2-18 Evaluation of the performance of thehighest governance body2-19 Remuneration policies2-21 Annual total compensation ratio2-22 Statement on sustainabledevelopment strategy
GRI Standards
GRI 2:
General Disclosures2021
GRI 2:
General Disclosures2021
GRI 3:
Material Topics2021
General Disclosures
Disclosure
2-26 Mechanisms for seeking advice andraising concerns
2-27 Compliance with laws andregulations
About This ReportChapter 1 Introduction to INOVANCEChapter 3 Sustainable Corporate Governance
3.3 Robust Operation
Chapter 7 Employee Development Guaratee
7.1 Employee Rights and Welfare Protection
Chapter 3 Sustainable Corporate Governance
3.1 ESG Management
Chapter 7 Employee Development Guaratee
7.1 Employee Rights and Welfare Protection
Chapter 3 Sustainable Corporate Governance
3.1 ESG Management
2-28 Approach to stakeholderengagement
3-1 Process to determine material topics
Chapter 3 Sustainable Corporate Governance
3.1 ESG Management
3-2 List of material topics
Chapter 3 Sustainable Corporate Governance
3.1 ESG Management
3-3 Management of material topics
2-30 Collective bargaining agreements
General Disclosures
Material Topics
Economic Performance
GRI 201:
EconomicPerformance2016
Appendix 1 ESG Key Performance Table
Appendix 1 ESG Key Performance Table
201-1 Direct economic value generatedand distributed
Economic PerformanceGRI 202:
Market Presence 2016
Appendix 1 ESG Key Performance Table202-2 Proportion of senior management
hired from the local community
Chapter 4 Empowering Decarbonization
4.1 Addressing Climate Change
201-2 Financial implications and other risksand opportunities due to climate change
Chapter 7 Employee Development Guaratee
7.1 Employee Rights and Welfare Protection
201-3 De?ned bene?t plan obligations andother retirement plans
Procurement Practices
GRI 204:
ProcurementPractices2016
Chapter 8Inclusive And Responsible Ecosystem Building
8.1 Building Sustainable Supply Chain
Appendix 1 ESG Key Performance Table
204-1 Proportion of spending on localsuppliers
Anti-corruption
GRI 205:
Anti-corruption2016
Appendix 1 ESG Key Performance Table205-1 Operations assessed for risks related
to corruption
Chapter 3 Sustainable Corporate Governance
3.3 Robust Operation
Chapter 3 Sustainable Corporate Governance
3.3 Robust Operation
205-2 Communication and training aboutanti-corruption policies and procedures205-3 Con?rmed incidents of corruptionand actions taken
201-4 Financial assistance received fromgovernment
GRI 206:
Anti-competitiveBehavior 2016
206-1 Legal actions for anti-competitivebehavior, anti-trust,and monopoly practices
Chapter 4 Empowering Decarbonization
4.5 Enhancing Resource Utilization Eciency
Appendix 1 ESG Key Performance Table
Anti-competitive behavior
Energy
GRI 302:
Energy2016
Chapter 4 Empowering Decarbonization
4.3 Strengthening Energy Management
Chapter 4 Empowering Decarbonization
4.3 Strengthening Energy Management
Chapter 4 Empowering Decarbonization
4.3 Strengthening Energy Management
Chapter 4 Empowering Decarbonization
4.3 Strengthening Energy Management
Chapter 4 Empowering Decarbonization
4.3 Strengthening Energy Management
302-1 Energy consumption within theorganization
Chapter 4 Empowering Decarbonization
4.4 Focusing on Environmental Compliance
Chapter 4 Empowering Decarbonization
4.4 Focusing on Environmental Compliance
Chapter 4 Empowering Decarbonization
4.4 Focusing on Environmental Compliance
Appendix 1 ESG Key Performance TableChapter 4 Empowering Decarbonization
4.4 Focusing on Environmental Compliance
Appendix 1 ESG Key Performance TableChapter 4 Empowering Decarbonization
4.4 Focusing on Environmental Compliance
Appendix 1 ESG Key Performance Table
Chapter 7 Employee Development Guarantee
7.1 Employee Rights and Welfare Protection
Chapter 7 Employee Development Guarantee
7.1 Employee Rights and Welfare Protection
Appendix 1 ESG Key Performance Table
306-1 Waste generation and signi?cantwaste-related impacts
302-2 Energy consumption outside of theorganization302-3 Energy intensity302-4 Reduction of energy consumption302-5 Reductions in energy requirementsof products and services
GRI 305:
Emissions2016
Chapter 4 Empowering Decarbonization
4.1 Addressing Climate Change
Chapter 4 Empowering Decarbonization
4.1 Addressing Climate Change
Chapter 4 Empowering Decarbonization
4.1 Addressing Climate Change
Chapter 4 Empowering Decarbonization
4.1 Addressing Climate Change
305-1 Direct (Scope 1)GHG emissions305-2 Energy indirect (Scope 2)GHG emissions305-3 Other indirect (Scope 3)GHG emissions305-4 GHG emissions intensity305-5 Reduction of GHG emissions
GRI 303:
Water and Euents2018
Chapter 4 Empowering Decarbonization
4.4 Focusing on Environmental Compliance
4.5 Enhancing Resource Utilization Eciency
Chapter 4 Empowering Decarbonization
4.4 Focusing on Environmental Compliance
303-1 Interactions with water as a sharedresource303-2 Management of waterdischarge-related impacts303-3 Water withdrawal303-4 Water discharge302-5 Water consumption
Water and Euents
305-7 Nitrogen oxides (NOx),sulfur oxides (SOx), and other signi?cantair emissions
Emissions
Appendix 1 ESG Key Performance Table/Appendix 1 ESG Key Performance Table
Appendix 1 ESG Key Performance Table
Appendix 1 ESG Key Performance Table
GRI 306:
Waste2020
GRI 308:
Supplier EnvironmentalAssessment 2016
306-3 Waste generated
306-4 Waste diverted from disposal
306-5 Waste directed to disposal
Waste
Supplier Environmental Assessment
Employment
Chapter 8 Inclusive And Responsible Ecosystem Building
8.1 Building Sustainable Supply Chain
308-1 New suppliers that were screenedusing environmental criteria
306-2 Management of signi?cantwaste-related impacts
Chapter 8 Inclusive And Responsible Ecosystem Building
8.1 Building Sustainable Supply Chain
308-2 Negative environmental impacts inthe supply chain and actions taken
401-3 Parental leave
GRI 401:
Employment2016
401-1 New employee hires andemployee turnover401-2 Bene?ts provided to full-timeemployees that are not provided totemporary or part-time employees
Chapter 7 Employee Development Guarantee
7.4 Occupational Health and Safety
Chapter 7 Employee Development Guarantee
7.4 Occupational Health and Safety
Chapter 7 Employee Development Guarantee
7.4 Occupational Health and Safety
Chapter 7 Employee Development Guarantee
7.4 Occupational Health and Safety
Appendix 1 ESG Key Performance TableChapter 7 Employee Development Guarantee
7.4 Occupational Health and Safety
Appendix 1 ESG Key Performance Table
Chapter 7 Employee Development Guarantee
7.4 Occupational Health and Safety
Appendix 1 ESG Key Performance TableChapter 7 Employee Development Guarantee
7.4 Occupational Health and Safety
Appendix 1 ESG Key Performance Table
Occupational health and safety
403-3 Occupational health services403-4 Worker participation consultation,and communication on occupationalhealth and safety403-5 Worker training on occupationalhealth and safety403-6 Promotion of worker health403-7Prevention and mitigation ofoccupational health and safety impactsdirectly linked by business relationships
GRI 403:
Occupational Healthand Safety 2018
403-1 Occupational health and safetymanagement system403-2 Hazard identi?cation, riskassessment, and incident investigation
4. UN SDGs Mapping Table
Chapter 7 Employee Development Guarantee
7.3 Employee Training and Development
Training and Education
Diversity and Equal Opportunity
404-3 Percentage of employees receivingregular performance and careerdevelopment reviews
GRI 404:
Training andEducation2016
404-1 Average hours of training per yearper employee404-2 Programs for upgrading employeeskills and transition assistance programs
Chapter 7 Employee Development Guarantee
7.4 Occupational Health and Safety
Chapter 7 Employee Development Guarantee
7.4 Occupational Health and Safety
Appendix 1 ESG Key Performance TableChapter 7 Employee Development Guarantee
7.4 Occupational Health and Safety
Appendix 1 ESG Key Performance Table
403-8 Workers covered by an occupationalhealth and safety management system403-9 Work-related injuries403-10 Work-related ill health
GRI 403:
Occupational Healthand Safety 2018
Appendix 1 ESG Key Performance TableAppendix 1 ESG Key Performance Table
GRI 405:
Diversity and EqualOpportunity 2016
405-1 Diversity of governance bodiesand employees
Non-discrimination
GRI 406:
Non-discrimination2016
406-1 Incidents of discrimination andcorrective actions taken
Chapter 7 Employee Development Guarantee
7.4 Occupational Health and Safety
Chapter 7 Employee Development Guarantee
7.4 Occupational Health and Safety
Child labor
GRI 408:
Child Labor2016
GRI 413:
Local Communities2016
408-1 Operations and suppliers atsigni?cant risk for incidents of child labor
Freedom of Association and Collective Bargaining
GRI 407:
Freedom of Associationand CollectiveBargaining 2016
Forced or Compulsory Labor
Local Communities
GRI 409:
Forced or CompulsoryLabor 2016
409-1 Operations and suppliers atsigni?cant risk for incidents of forced orcompulsory labor
407-1 Freedom of Association andCollective Bargaining 2016
Chapter 7 Employee Development Guarantee
7.1 Employee Rights and Welfare Protection
Chapter 7 Employee Development Guarantee
7.1 Employee Rights and Welfare Protection
Chapter 7 Employee Development Guarantee
7.1 Employee Rights and Welfare Protection
Chapter 8 Inclusive And ResponsibleEcosystem Building
8.1 Building Sustainable Supply Chain
Chapter 8 Inclusive And ResponsibleEcosystem Building
8.1 Building Sustainable Supply Chain
413-1 Operations with local communityengagement, impact assessments,and development programs413-2 Operations with signi?cant actualand potential negative impacts on localcommunities
GRI 416:
Customer Healthand Safety2016
Customer Health and Safety
GRI 417:
Marketing andLabeling2016
GRI 418:
Customer Privacy2016
Chapter 3Sustainable CorporateGovernance
Chapter 4EmpoweringDecarbonization
Chapter 5Chapter Focus onCustomer Satisfaction
Customer Health and Safety
Customer privacy
416-1 Assessment of the health andsafety impacts of product andservice categories416-2 Incidents of non-complianceconcerning the health and safetyimpacts of products and services
Appendix 1 ESG Key Performance Table
418-1 Substantiated complaintsconcerning breaches of customerprivacy and losses of customer data
Chapter 6 Innovation Drives Development
6.2 Data Privacy Protection
Appendix 1 ESG Key Performance Table
417-1 Requirements for product andservice information and labeling
Chapter 5 Focus on Customer Satisfaction
5.2 Improving Customer Services
Appendix 1 ESG Key Performance Table
Appendix 1 ESG Key Performance TableAppendix 1 ESG Key Performance Table417-3 Incidents of non-complianceconcerning marketing communications
417-2 Incidents of non-complianceconcerning product and serviceinformation and labeling
SDGs Mapping
3.1 ESG Management
3.2 Corporate Governance
3.3 Robust Operation
4.1 Addressing Climate Change
4.2 Innovative Green Products
Feature TopicScope 4 Avoided Emissions
4.3 Strengthening Energy
Management
4.4 Focusing on Environmental
Compliance
4.5 Enhancing Resource
Utilization Eciency
5.1 Strict Product Quality Control
5.2 Improving Customer Services
16 Peace, Justice and Strong Institutions17 Partnerships for the Goals7 Affordable and Clean Energy9 Industry, Innovation and Infrastructure12 Responsible Consumption and Production13 Climate Action
12 Responsible Consumption and Production
ChaptersSections
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Appendix 3: GlossaryAppendix 3: Glossary
Chapter 6Innovation DrivesDevelopmentChapter 7EmployeeDevelopmentGuarantee
Chapter 8InclusiveAnd ResponsibleEcosystem Building
6.1 R&D Innovation Focus
6.2 Data Privacy Protection
7.1 Employee Rights and
Welfare Protection
7.2 Talent Attraction and Retention
7.3 Employee Training and
Development
7.4 Occupational Health and Safety
8.1 Building A Sustainable
Supply Chain
8.2 Promoting Industrial
Cooperation and Development
8.3 Contributing to Social
Development
9 Industry, Innovation and Infrastructure
3 Good Health and Well-being5 Gender Equality8 Decent Work and Economic Growth10 Reduced Inequalities
4 Quality Education9 Industry, Innovation and Infrastructure12 Responsible Consumption and Production17 Partnerships for the Goals
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The Table below presents the ESG material topics of high impact obtained after screeningby materiality threshold and impact analysis for the year 2023, as well as their de?nitions,boundaries and corresponding chapters & sections where related information is disclosed.Here, the "boundary of topic" refers to the links that may have a signi?cant impact on suchESG issues along the Company's value chain after preliminary identi?cation, which aredivided into three categories: "supply chain," "production and operation," and "productsand services".No.DimensionsTopicsBoundary of TopicsDe?nition of TopicsLocation
E
Opportunitiesin CleanTechnology
It is de?ned as INOVANCE'sinnovation capability and strategicdevelopment plans in clean tech, aswell as the key measures andachievements in seizing theopportunities. This includesINOVANCE's efforts in activelypromoting the application of cleanproduction processes, the use ofclean energy, providing solutions forclean tech, enhancing innovationcapabilities, and accelerating marketdevelopment to promote thedevelopment of clean tech.
4.2 Innovative
Green Products
E
GreenProducts andInnovation
INOVANCE integrates green andsustainable principle into the entirelife cycle of product design,production, transportation, andrecycling, providing green productswith comprehensive environmentalbene?ts such as "energy conserva-tion, material conservation, andeciency enhancement," andpromoting the R&D of new greenproduct with relevant measures andoutcomes.
4.2 Innovative
Green Products
SupplyChains
Prodution
andOperation
Products
andServices
E
ClimateChangeMitigation andAdaptation
INOVANCE establishes dual carbonstrategy and climate changemanagement system. This includessetting climate goals and emissionreduction pathways, establishing aclimate governance structure,identifying climate risks andopportunities, promoting low-car-bon manufacturing and transforma-tion, and GHG emissions inventoryand climate information disclosure.
4.1 Addressing
Climate Change
S
CustomerRelationManagement
INOVANCE establishes systemsand implements measures forcustomer service, customercomplaint handling, responsiblemarketing, and other customerrelationship management,including the disclosure ofrelevant data such as customersatisfaction, customer service,and complaints.
5.2 Improving
CustomerServices
4S
TalentAttraction andRetention
7.2 Talent
Attraction andRetention
S
SustainableSupply ChainManagement
INOVANCE establishes sustainablesupply chain managementsystem. This includes relevantmanagement systems andmeasures such as supplieraccess, classi?cation management,risk assessment, and performanceevaluation, as well as supply chainlabor standards, responsibleprocurement management,and cooperation with customersand suppliers to build sustainablesupply chain construction.
8.1 Building
SustainableSupply Chain
6S
R&D andInnovation
INOVANCE launches managementsystem and R&D progress in the?eld of technological innovation,including the company's R&D andinnovation management system,plans, platforms, progress ofproducts under development,impact on the company, as well asR&D incentives and innovationculture.
6.1 R&D Innova-
tion Focus
Appendix 4: Material Topics of High Impact in 2023Appendix 4: Material Topics of High Impact in 2023
INOVANCE has rich humanresources and put efforts toattract and retain talents. Thisincludes providing a comfortable and good working environ-ment, fair and transparentemployment processes,competitive compensation andbene?ts, smooth developmentchannels and promotionopportunities, and specialincentive policies.
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