Environmental, Social, and Governance(ESG)Report
Create Values Through Technology
Integrity 04. Social:
Sharing
About This Report 01 Standardizing Corporate Governance 16 Creating Satisfied Customers 54
Message from the Chairman 02 Strengthening Compliance Management 21 Advancing a People-Centric Philosophy 72
Our 2025 03 Strengthening Data Security 30 Advancing Responsible Sourcing 92
ESG Strategy and Management 08 Exemplary Corporate Citizenship 98
Sustainability 05. Ending
Tackling the Climate Change 36 ESG Key Performance Indicator 100
Mitigating Environmental Impact 43 Index Table 108
Practicing the Circular Economy 50 Statement of the Board of Directors 115
Independent Assurance Statement 116
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About This Report
This report is the third annual Environmental, Social, and Governance (ESG) Report published by Shanghai Longcheer Technology Co., Ltd. Prepared in accordance with
the principles of materiality, quantifiability, balance, and consistency, the report focuses on the disclosure of the ESG concepts, significant progress, achievements, and
future plans of Shanghai Longcheer Technology Co., Ltd. and its subsidiaries.
The reporting period covers January 1, 2025 to December 31, 2025. Any inconsistencies will be explained in the relevant sections of this report..
Basis of Compilation Source of Information and of any discrepancy, the Simplified Chinese version
Reliability Statement shall prevail.
In the preparation of this report, the company identified key stakeholders, analyzed and prioritized material
issues related to environmental, social, and governance topics, defined the reporting boundary, and collected, The information contained in this report is sourced
summarized, organized, and reviewed operational and financial information from the company. Based on these from Shanghai Longcheer Technology Co., Ltd. and its Confirmation and Approval
processes, the report was ultimately compiled. subsidiaries. The Board of Directors of the company is
responsible for the truthfulness, accuracy, and integrity This report has been reviewed and approved by the
The following standards and guidelines were referenced in the preparation of this report:
of this report. To boost the credibility of the report, Board of Directors of the company and is hereby
Self-Regulatory Guidelines No. 14 for Listed Companies — Sustainability Report (Trial) of the Shanghai Stock published.
the company has engaged an independent third-party
Exchange
institution to verify the disclosed information and issue
Self-Regulatory Guide No. 4 for Listed Companies — Compilation of Sustainability Report of the Shanghai Stock a verification report(see the "Independent Assurance
Exchange Statement" section).
Access to the Report and
Appendix C2 Environmental, Social and Governance Reporting Code of the Main Board Listing Rules issued by HKEX
Feedback
Global Reporting Initiative (GRI) Standards of the Global Sustainability Standards Board (GSSB)
Explanation of Terms You can access the electronic version of this report
Sustainable Development Goals (SDGs) of the United Nations on the company's website (https://www.longcheer.
The Ten Principles of the UN Global Compact For the convenience of expression and reading, com/), CNINFO (http://www.cninfo.com.cn/), and
"Longcheer Technology," "Longcheer," “the group,” HKEXnews (https://www.hkexnews.hk/).
International Organization for Standardization ISO 26000: Guidance on Social Responsibility (2010)
"the company,” and "we" in this report refer to
If you have any suggestions or feedback regarding
Shanghai Longcheer Technology Co., Ltd. and its
the contents of this report or the ESG practices of
subsidiaries.
Longcheer Technology, please feel free to contact us
Report Scope and Boundary through the following channels:
Languages of the Report
Unless otherwise specified, the policies, statements, and information disclosed in this report cover the actual Email: ir@longcheer.com
business operations of Shanghai Longcheer Technology Co., Ltd. and its subsidiaries, consistent with the scope This report is published in Simplified Chinese,
disclosed in the company’s 2025 Annual Report.Unless otherwise specified, CNY is the currency unit used in this Traditional Chinese, and English. The English version is Tel: +86 21-61890866
report. a translation of the Simplified Chinese version. In case
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Message from the Chairman
clients worldwide with high-quality and reliable Promoting Green Operations to Fulfill Environmental value. It places great importance on employee
intelligent product solutions. Responsibility development and rights protection, continuously
improving training and empowerment programs
Strengthening Governance Foundations for Long-Term The company integrates green development principles while strengthening organization-wide compliance
Development throughout product design, manufacturing, and awareness and professional capabilities.In supply
operational management, continuously advancing chain management, the company has signed integrity
Sound governance underpins the company’s long-term energy conservation, carbon reduction, efficient and compliance agreements with partners and
development. During the reporting period, the company resource use, and pollution prevention. Medium- and implemented responsibility audits covering all core
further improved its modern corporate governance long-term targets have been established for greenhouse suppliers, promoting a fair, transparent, and sustainable
framework and strengthened the Board of Directors’ gas emission intensity, water conservation, and solid partnership ecosystem. The company also continues
oversight of strategic and ESG matters, establishing an waste management.Through intelligent manufacturing to strengthen product quality and safety management
efficient decision-making and supervision mechanism upgrades and automation transformation, the company by enhancing audit standards and delivery capabilities.
with clearly defined responsibilities. improved production efficiency and energy utilization, Through collaboration with customers, employees,
enabling coordinated progress between business suppliers, and the broader community, the company
In risk management and internal control, the company expansion and reduced energy intensity. At the same continues to expand its social value and promote
continued to enhance the “three lines of defense” time, the company strictly manages exhaust emissions, mutually beneficial development.
framework and strengthened closed-loop management wastewater discharge, and hazardous substances,
of risk identification, assessment, and remediation, strengthens source reduction and process control, and In January 2026, the company successfully established
improving operational stability and transparency. The promotes resource recycling and reuse. Driven by both an “A+H” dual-capital platform, marking a new stage
"
company maintains zero tolerance for commercial management systems and technological innovation, in its global development journey. Looking ahead,
In 2025, Longcheer Technology made important bribery and misconduct, while continuously improving the company continues to reduce environmental Longcheer Technology will continue to enhance its ESG
progress in advancing its globalization and high- whistleblowing and compliance management impacts while ensuring compliant operations, management, actively support the dual-carbon strategy,
quality development strategy. Amid profound changes mechanisms to uphold integrity in business operations. further strengthening the foundation for sustainable and work with industry partners to advance a more
in the global technology industry, the company The information security management system was development. sustainable development ecosystem.
remained committed to its mission of “ Create Values further upgraded, with no major information security
Du Junhong
Through Technology.” Focusing on sustainable and incidents reported during the year, providing strong Fostering Shared Value through Win-Win Collaboration
quality-driven growth, the company continued to support for global operations and client trust. These and a Responsible Ecosystem
advance innovation while strengthening its global efforts have strengthened the company’s governance Chairman of Longcheer Technology
presence. Supported by a globally integrated R&D and capabilities and reinforced the institutional foundation The company remains committed to building
manufacturing network, Longcheer provides leading for sustainable development. its capabilities with a strong focus on customer
" 02
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Our 2025
Suzhou
About Longcheer Xi'an R&D
Center
R&D
Center
Longcheer Technology is a technology enterprise engaged in the integrated services of
research and development, design, and manufacturing of intelligent products. Upholding Nanchang USA
its core values of “customer-centricity, inspiring dedication, and long-term driven,” the R&D Center Branch
Hefei R&D
&MFG Base Office
company continues to support the growth of leading global consumer electronics brands Cente
and technology companies.
Aligned with the upgrading trends of the intelligent terminal industry, the company has
Huizhou South
established a comprehensive product portfolio covering smartphones, AI PCs, automotive R&D Shanghai Korea
electronics, tablets, smartwatches/fitness bands, and smart glasses. It provides clients Center Headquarters Branch
with end-to-end services spanning product definition, R&D and design, and intelligent &MFG Site and R&D Office
Center
manufacturing. With operations across multiple countries and regions, the company has
built a global operating network and delivery system supported by its overseas branches
and manufacturing footprint, continuously enhancing its capability and efficiency in serving
India MFG Japan
international clients. Branch
Base
Office
Shenzhen
Headquartered in Shanghai, the company operates seven R&D centers strategically located Hong
R&D
in Shanghai, Shenzhen, Huizhou, Nanchang, Hefei, Xi'an, and Suzhou, with a concentrated Center Kong,
China
focus on technological breakthroughs and innovative advancements in the frontier Branch
domain of on-device AI. On the manufacturing front, the company has established four Office Singapore
Vietnam
manufacturing centers in Huizhou, Nanchang, Vietnam, and India, forming a multi-regional Branch
MFG Base
Office
collaborative production system to support global, large-scale, and agile delivery.
Looking ahead, Longcheer will continue to implement its “1+2+X” product strategy,
maintain a focus on the intelligent product sector, and advance technological and product
innovation. The company will further enhance operational efficiency and competitiveness,
accelerate intelligent transformation, and continue to deliver high-quality services to leading Shanghai Shanghai, Shenzhen, Huizhou,
Nanchang, Hefei, Xi'an,Suzhou
Nanchang, Huizhou, India and
Vietnam
US, Japan, Korea, Hong Kong,
and Singapore
global clients while creating greater value for society. Global headquarter R&D centers Manufacturing bases Branches
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Annual Operating Revenue Domestic Operating Revenue
Overseas Operating Revenue Taxes and Fees Paid
Smart Smart
X Mobility Smart Extended
Office
million CNY million CNY
Home Smart Smart Reality
Healt Life
Net Profit Attributable to Ordinary Shareholders Cumulative Dividends Paid
of the Company Since Listing
Automotive Personal
Electronics Computing
million CNY
Create Values Through Customer Centric Inspiring
Smartphone Dedication Long-term
Technology
Driven
“1+2+X” Product Strategy
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Chronicle of Company Development
Construction of the Shanghai headquarters building
Longcheer Technology was listed on the Shanghai Establish Xi'an and Suzhou R&D Centers
was initiated
Establish a strategically distributed production 603341) (HK:09611)
network in Huizhou, Nanchang, Vietnam, and India
The Nanchang Science
and Technology Park
achieving annual shipments AIoT products
exceeding 100 million units
center projects were authorization for Google Wear
officially launched OS ODM in Mainland China
transformation to Android
smartphone business
Shanghai. production, beginning the transition to
ODM
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Annual Performance and
In addition to advancing its internal ESG objectives, the company actively engages with the broader industry ecosystem and collaborates with peers to promote
sustainable development. In 2025, Longcheer Technology, together with 11 enterprises and institutions, launched the “Electronics Industry ESG Cooperation
Progress
Initiative” at the 2025 IPC CEMAC Electronics Manufacturing Annual Conference. The Initiative focuses on key ESG priorities and common challenges within the
electronics industry, contributing to the development of a more collaborative ESG ecosystem across the sector.
Governance: Integrity Environmental: Sustainability Social: Sharing
Independent directors Female directors accounted for Percentage of manufacturing bases certified to ISO 50001 Percentage of women in Percentage of operating
accounted for revenue-generating functions: facilities certified to ISO 45001
Coverage rate of business ethics Number of material information Percentage of operating sites certified to ISO 14001
training reached security breach incidents
Responsibility Agreement
Provide full coverage of anti-
No incidents
ISO 27001 certification coverage across all operating sites
of penalties due to discrimination and anti-
reached
all employees
harassment training for
of target suppliers underwent
violations of environmental laws and regulations during the
corporate social responsibility
reporting period
assessments
The company has been rated as The execution rate of Cumulative electricity savings of Water savings of approximately In 2025, the company provided employment opportunities for
a Class
A Taxpayer for
confidentiality agreements
reached 11.39 20,200 139 persons with disabilities and
consecutive years in recognition
coverage million kWh for the reporting metric tons for the reporting colleagues from ethnic minorities, striving to create a diverse and
of its tax credit standing.
period period inclusive workplace environment and culture
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External Recognition China Top 500 Manufacturing
Enterprises
and Awards China Enterprise Confederation 2025 Shanghai Top 100 Enterprise List
September 2025
National Green Factory
Shanghai Private Shanghai Growing
Ministry of Industry and Information
Technology of China
Top 100 Leading Enterprises in China’s Manufacturing Enterprises Enterprises
Strategic Emerging Industries
January 2025
China Enterprise Confederation & China
Top 100- 5th Top 100- 10th
Perfect Quality Enterprise Directors Association
September 2025
Lenovo Shanghai Emerging Shanghai Private
May 2025 Industry Enterprises Enterprises
Best Quality Award
Enterprise Award Top 100- 13th Top 100- 16th
Lenovo IPC Asia
May 2025 September 2025
Shanghai Manufacturing
Shanghai Enterprises
Enterprise
Fortune China 500 Lenovo Quality Leadership Award
Top 100- 17th Top 100- 47th
Fortune China Lenovo
Top 100 Enterprises in Electronic
Information Competitiveness Xiaomi Best Partner Award
China Electronic Information Industry
Xiaomi
Federation
September 2025
ESG Best Practice Top 100 Xiaomi Outstanding Quality Award
Achieved an AA rating A
Received an rating A
Attained an rating Awarded a B rating
Wind Xiaomi in the 2025 Wind ESG in the SynTao Green in the Hua Zheng ESG in the CDP Climate
September 2025
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ESG Strategy and Management
Board of Directors
ESG Strategy and Mechanism
Strategic Level
Longcheer integrates Environmental, Social and Governance (ESG) principles into its corporate governance and business management
systems. By improving governance structures, clarifying strategic direction, strengthening risk management and control, and continuously Strategy and ESG Committee
optimizing management mechanisms, the company drives alignment between ESG management and long-term development objectives,
solidifying the governance foundation for high-quality, sustainable development.
ESG Governance
Decision-Making
The company has established an ESG governance structure integrated decisions on ESG-related matters.The ESG Office, composed of
Level
ESG Executive Committee
with its existing corporate governance system, forming a management representatives from functional systems and manufacturing sites,
system with clear authority and accountability that connects all levels. leads and coordinates the execution of ESG-related work and regularly
reports to the ESG Executive Committee.
The Board of Directors serves as the company's highest decision-
making body, bearing ultimate responsibility for sustainable In 2025, the company appointed a Chief Sustainability Officer (CSO),
development and ESG management, and exercising strategic who reports directly to the Board of Directors and the Strategy and
ESG Office
leadership and oversight functions within the governance structure. ESG Committee. Serving as convener of the ESG Executive Committee
The Strategy and ESG Committee, established under the Board, and Director of the ESG Office, the CSO coordinates strategic planning,
operates as a specialized working body performing relevant duties in compliance and risk control, operational integration, and performance
accordance with the Implementation Rules for the Board Strategy and monitoring to ensure effective implementation of sustainable
ESG Committee . Composed of directors and chaired by the Chairman development goals.ESG-related sustainability metrics have been ESG Implementation Working Group
of the Board, the committee convenes meetings through standardized incorporated into the CSO’s annual performance evaluation,
Execution Level
procedures and reports to the Board. accounting for 10% of the overall performance assessment.
Functional and
Special Topic
The ESG Executive Committee serves as the decision-making body During the reporting period, the Strategy and ESG Committee held Manufacturing Base
Working Groups
bridging the upper and lower levels of the ESG governance framework. two meetings to research, discuss, and provide recommendations on Matrix
In terms of oversight, it coordinates ESG efforts across various the company's long-term development strategy, major investment
functions. In terms of support, it allocates necessary resources for matters, and ESG-related issues, continuously strengthening the
corporate-level ESG initiatives to ensure effective implementation. Board's review and oversight functions for ESG matters.
In 2025, the ESG Executive Committee held six meetings to make
Longcheer's ESG Governance Structure
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ESG Strategy
Longcheer has integrated sustainability principles into its overall development planning. The Strategy and ESG Committee is mandated to research the company's sustainable development strategy, ESG objectives, and major matters,
and to review ESG-related reports, ensuring alignment between ESG management and corporate strategic direction. Meanwhile, the committee deliberates and researches major investment and financing proposals, capital operations,
and asset management projects, incorporating ESG factors into major decision-making considerations. This drives deep integration of environmental, social, and governance requirements with business decisions, achieving coordinated
advancement of strategic development and sustainability goals.
Adhering to the mission of "Create Values Through Technology," Longcheer Technology adopts a long-term orientation and has established a three-tier ESG strategic framework:
Core Layer Longcheer is customer-centric and innovation-driven, providing leading solutions to customers. It ensures product stability and
reliability through quality assurance and achieves co-growth with customers through rapid response and high-standard audits.
g ew
in Corporate Governance:Longcheer Technology ensures integrity in operations through standardized governance and business
ar
on
ethics systems aligned with international best practices.
sh
me
al:
nt s
Soci
Customers Middle Layer Environmental :Longcheer Technology is fully committed to addressing climate change, promoting environmental sustainability
ustino
and through green products and green operations, and contributing to the preservation of natural landscapes.
Innovation
Social :By building a globally satisfied workforce, advancing responsible procurement management, and fulfilling exemplary
corporate citizenship obligations, Longcheer Technology fulfills its mission of "Create Values Through Technology" and shares
y
rit
C
te
g or
po the benefits of technological advancement.
:In rate
Governance
Impact Layer Through systematic, scientific, and standardized ESG efforts, Longcheer supports the achievement of 16 of the United Nations
Sustainable Development Goals, contributing its corporate strength.
Longcheer ESG Strategy Framework
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ESG Risk Management
Longcheer has deeply integrated ESG risk management into its overall risk management process, continuously improving institutional documents such as climate change policies and supplier codes of
establishing systematic management mechanisms across governance structure, risk identification, conduct, and strengthening monitoring and data management through digital systems. Meanwhile, the
assessment and grading, institutional development, and business integration, achieving comprehensive company embeds ESG requirements into core business processes including procurement, production, and
fusion of sustainability factors with business operations. investment and financing—for example, reinforcing admission and graded management through a supplier
ESG scoring mechanism, and incorporating ESG assessments into investment and financing due diligence,
The company regularly employs tools such as the SASB Materiality Issues Matrix and scenario analysis achieving front-end identification and control of risks and avoiding potential compliance and reputational
to identify environment, social, and governance-related risks and opportunities from a full value chain risks from concentrating at the back end.
perspective, including supply chain human rights risks, climate policy change risks, compliance and
regulatory risks, customer audit risks, and reputational risks. For identified risks, the company implements Currently, Longcheer has organically integrated the above risk identification and assessment mechanisms
graded management based on probability of occurrence and impact severity, prioritizing high-probability, with existing management processes, constructing dynamic monitoring and continuous optimization
high-loss risk matters such as environmental penalties, major quality incidents, or reputational crises, and mechanisms at the business level. Through regular internal ESG hierarchical reporting, ESG report publication,
clearly defining responsible departments and response measures to enhance the relevance and effectiveness customer social responsibility audits, and external rating assessments, the company has formed a closed-
of risk response. loop management system of "governance—assessment—execution—monitoring," continuously enhancing
systematic management capabilities for long-term strategic risks, compliance risks, and reputational risks,
The company has formulated specialized management policies and tools focused on key ESG risks, providing strong support for the company's stable operations and sustainable development.
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Metrics and Targets
Fields Targets 2025 Metrics and Progress
In 2025, information security awareness training achieved 100%
coverage of all employees
Information security awareness training coverage target: 100% of employees
In 2025, confidentiality agreement signing rate achieved 100%
Confidentiality agreement execution rate: 100%
coverage
Major information security incidents(annual) : 0
No major information security incidents occurred throughout the
Governance year
Using 2023 as the baseline year, the company targets at least a 3% annual In 2025, the company’s greenhouse gas emission intensity was
reduction in greenhouse gas emission intensity 2.38 tonnes of CO2 equivalent per million of operating revenue
The company's general solid waste recycling rate remains stable at 90% (±3%) In 2025, 97.7% of the company's waste was recycled and reused
Using 2023 as the baseline year, the company has set water-saving targets for the In 2025, the company's water consumption decreased by 19.8%
next five years, aiming for a 3% annual reduction in m? per 10,000 unit quarter-over-quarter
Environmental
In 2025, first-time pass rate for customer information security and
Customer information security and yellow zone audit pass rate: 100% yellow zone audits: 100%
Major safety incidents: 0 In 2025, zero major safety incidents occurred
Occupational diseases: 0 In 2025, zero occupational disease cases occurred
Chemical leakage incidents: 0 In 2025, zero chemical leakage incidents occurred
Social 100% completion of supplier annual CSR audit plan In 2025, CSR audit completion rate for supplier annual review
plan: 100%
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Dual-Materiality Stakeholder Identification and Engagement
Analysis Longcheer attaches great importance to regular communication and two-way engagement with diverse stakeholders. Through multiple channels, the company proactively
listens to and responds to stakeholder concerns, translating communication outcomes into important foundations for management improvement and strategic optimization,
continuously enhancing corporate sustainability performance.
Stakeholder
Shareholders Capital Market Customers Employees Suppliers Communities Social Organizations
Group
·Exchanges, Securities Regulatory ·Universities and
Research Institutions
·Telecom Operators
Commissions and other regulatory
Stakeholder
·Investors authoritie ·All Employees ·All Suppliers ·Targeted Assistance Areas ·Media
·Potential Investors ·Brand Customers
·NGOs
Representatives
·ESG Risk Management ·Industry Associations
·Company's Business ·High-quality Product
·Compensation and Benefits ·Fair and Transparent Procedures ·Strong Collaborative
·Long-term Development Planning Performance
·Capacity Building Programs ·Stable Financial Performance ·Contribution to
·Compliance and Legal Operations ·Information Security and
Relationship
and Financial Performance
·Clear and Transparent ·Timely Sharing of
·ESG Performance ·ESG Risk Management Privacy Protection and Payment Policies Sustainable Community
·Long-term and Stable Cooperative
Stakeholder
·Green Product Standards
Career Paths Development Corporate Experience
Concerns ·Corporate Governance and Risk ·Stable and Healthy Investment ·Sharing of Corporate
·Stable Corporate and Practices
·Timely and Efficient Customer
Relationships
·Fair, Just, Open, and Transparent ·Collective Industry
Control Returns Development Outcomes
Development
·Investor Communication and Service
·Workplace Health and Safety Development
·Overall ESG Performance
Environment
Engagement
·Pollutant Emissions ·Product and Service
·Product and Service Quality ·Employee Health and Safety
·Compliance and Risk Management ·Compliance and Risk Management ·Product and Service Quality ·Rural Revitalization and Quality
·Data Security and Customer ·Employee Welfare and Care
·Product and Service Quality ·Protection of Customer Rights ·Innovation-Driven Growth ·Anti-Unfair Competition
Stakeholder
Social Contribution
Focus Topics Privacy Protection ·Employee Legal Rights and
·ESG Management ·Product and Service Quality ·Supply Chain CSR Management ·Environmental Compliance ·Compliance and Risk
·Technology Ethics Protections
Management Management
·Pre-sales Communication ·Online Communication
·Information Disclosure ·After-sales Service Platforms ·Periodic Communication
·Supplier Training
·Shareholders' General Meeting ·Information Disclosure ·Employee Complaint Hotline
Key
·Routine Communication (e.g.,
and Feedback
·On-site Audits and ·Project Cooperation
Communication
and ·Investor Research ·Investor Relations Records Customer Visits) ·Employee Shared Service ·Public Welfare Activities
·High-quality Industry Exhibitions
Communication ·Websites, Official
Engagement ·Communication Hotline and Email ·ESG Ratings Center
·Regular Visit
·Third-party Training ·Joint Debugging Center
Accounts and other
·SSE E-Interaction Platform
Methods
Public Channels
·Customer Audit ·HR Service Public Email
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Double Materiality Analysis Framework
Following the overarching principle of "systematic identification, scientific assessment, prudent validation, and dynamic application," the company has established a standardized double materiality analysis process. This process
integrates stakeholder concerns with the company's development strategy, ensuring that the identification of material issues is both compliant and rigorous, thereby providing robust support for information disclosure and strategic
decision-making.
Value Chain and Stakeholder Developing the List of Double Report Disclosure and
ldentification Sustainability Topics MaterialityAssessment Strategic Integration
Value chain mapping and stakeholder Referencing standards and industry practices Conduct double materiality assessment on Report, strategize, and improve —
identification to build a sustainable development topics list topics' impacts and financial significance closing the loop
Based on its business model, the company The Company systematically develops a Based on the list of sustainability topics, the The Company incorporates the double
systematically analyzes its overall valuechain scientific, comprehensive, and industry- Company conducts a double materiality materiality assessment results into its
structure to identify the main stakeholder relevant list ofsustainability topics, guestionnairesurvey with key stakeholder annual sustainabilityreport for standardized
groups involved in each businesssegment. This process intearates reference to groups. disclosure, ensuring information transparency,
lt assesses the degree of correlation and sustainability disclosure standards This process systematically assessesthe impact compliance, and completeness.
influence these stakeholders haveon the andguidelines, capital market ESG rating of each topicon the economy, environment, Concurrently, the assessment conclusions are
company's operational activities, clarifying requirements, peer benchmarking analysis, and society, as well as their potential influence integrated into the Company'ssustainability
their roles and level ofparticipation in the and research onindustry trends, while also on the company's financial position and strategy and management practices,
value creation process. taking into account Longcheer's own business operating results. Through guantitative implementing closed-loop management
model and operationalrealities. analysis and comprehensiveevaluation, the aroundmaterial topics to continuously
final double materiality assessment results are improve sustainability performance.
determined.
Analysis Process for the Double Materiality of Longcheer
In 2025, the company conducted an online survey of internal and external stakeholders, distributing the Double Materiality Assessment questionnaire. A total of 534 valid responses were collected, comprising 452 from internal
stakeholders and 82 from external stakeholders. Based on the survey results, the company assigned values to the question options and applied the weighted average method for calculation and analysis, ultimately forming a Materiality
Matrix and completing the 2025 Double Materiality Analysis.
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Double Materiality Matrix
Impact Importance
In 2025, Longcheer Technology developed a list of topics for the year by taking into account the exchange- Data Security and Customer
Privacy Protection
prescribed topics, its own business characteristics, and industry development trends. A total of 26 relevant topics Protection of Customer
Product and Service Safety and
Rights
were identified, of which seven were deemed to have high financial materiality and a significant level of impact. Quality
Tackling Climate Innovation-Driven
Growth
Longcheer 2025 List of ESG Topics Protection of Employees' Change
Statutory Rights
Compliance and Risk
Employee Welfare and Care Management
Anti-Commercial Bribery and
Anti-Corruption
Hazardous Substance Management
Employee Health and Safety
Employee Training
and Development Conflict Minerals
Management Environmental
Social Topics Environmental Topics Corporate Governance Topics Pollutant Emissions
Technology Energy Utilization
Compliance Management
Ethics
Waste
Circular Management Supply Chain CSR Management
Water Resource Economy
Chemical Safety and Reduction/
Quality 4 Waste Management 3 Anti-Unfair Competition
Management 6 Water Resource Utilization Management Anti-Unfair Competition
Privacy Protection Management
Rural Revitalization and Social
Statutory Rights Contribution
Development
Substitution
Contribution
The Longcheer Strategy and ESG Committee has comprehensively reviewed and confirmed this year's Materiality
Matrix.
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Governance:Integrity
Supporting SDGs
Longcheer continuously improves its corporate governance and compliance management system, integrating the concept of
sustainable development into strategic decision-making and daily operations. Focusing on key areas such as the ESG governance
structure, business ethics, anti-corruption and anti-unfair competition, and risk management, the company strengthens policy
development and implementation oversight. By refining its internal control mechanisms and risk identification processes,
Longcheer enhances management transparency and operational efficiency, striving to build itself into a global technology
company characterized by standardized governance, efficient operations, and trustworthiness.
Our Targets
Information security awareness training coverage target: 100% of employees
Confidentiality agreement execution rate: 100%
Major information security incidents(annual) : 0
Our Progress
The company organized 7 shareholders' meetings and 14 board No major information security incidents occurred
meetings throughout the year throughout the year
A n n u a l i n fo r m at i o n s e c u r i t y a wa re n e s s t ra i n i n g a c h i e v e d 100% of operating sites certified under ISO 27001
The company has been rated as a Class A taxpayer for
Confidentiality agreement signing rate achieved 100% coverage consecutive years
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Standardizing Corporate Governance
Optimizing Corporate Governance General Meeting
of Shareholders
Remuneration and
Appraisal Committee
Longcheer strictly adheres to the requirements of relevant laws, regulations, and normative documents, including
Nomination Committee
the Company Law of the People's Republic of China, the Securities Law of the People's Republic of China, the Code of Board of
Corporate Governance for Listed Companies , the Stock Listing Rules of the Shanghai Stock Exchange, and the Rules Directors
Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited. The company has formulated and Audit Committee
implemented internal rules and systems such as the Articles of Association , the Board Diversity Policy , the Rules of
Management Strategy and ESG Committee
Procedure for the Board of Directors, and the Rules of Procedure for General Meeting of Shareholders, establishing a
corporate governance system with clear authority, responsibilities, and standardized procedures.
The Board of Directors has established the Strategy and ESG Committee, the Audit Committee, the Nomination
Longcheer's Corporate Governance Structure
Committee, and the Remuneration and Appraisal Committee. Through specialized division of labor and collaborative
operation, these committees promote the company's compliant and stable operations.
Board Members and Performance of Duties
The Board of Directors operates on a three-year term system, with the eligibility for re-election upon term expiration. The Board consists of seven members, including three
independent directors and one employee representative director. Directors who are not employee representatives are elected by the General Meeting of Shareholders, while
the employee representative director is elected by the Staff Representative Congress. The Nomination Committee is responsible for candidate selection and pre-qualification
review, and the General Meeting of Shareholders has the authority to remove directors prior to term expiration in accordance with established procedures.
In accordance with the Articles of Association and the Board Diversity Polic y, Board members are required to maintain balance and diversity across multiple dimensions,
including gender, age, nationality, cultural and educational background, professional expertise, and industry experience. Independent directors shall possess the necessary
work experience in law, accounting, economics, or other relevant fields to fulfill their duties. The Chair of the Audit Committee must be an independent director with
expertise in accounting or financial management, and independent directors must constitute the majority on both the Nomination Committee and the Remuneration and
Appraisal Committee. The Nomination Committee conducts an annual assessment of the effectiveness of the Board Diversity Policy, monitors its implementation, reviews the
Board's composition, and proposes adjustments as necessary. In 2025, the Board's professional competencies encompass key areas including strategic investment, financial
accounting, advanced manufacturing, and R&D. Through its specialized committees, the Board achieves functional structuring, supporting the company's governance in the
context of its cross-market operations.
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Detailed Information of Longcheer Board of Directors Members
Professional Background
Term of Specialized Committee
No. Name Position Gender Age Nationality
Office Industry Accounting/ Strategic Memberships
R&D
experience Finance Investment
Nomination Committee
Chairman of the
Board
Committee
Director and General Strategy and ESG
Manager Committee
Director and Deputy
General Manager
Employee
Director
Audit Committee
Nomination Committee
Independent Remuneration and
Director Appraisal Committee
Strategy and ESG
Committee
Audit Committee
Independent
Director
Appraisal Committee
Audit Committee
Independent Nomination Committee
Director Remuneration and
Appraisal Committee
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Board ESG Empowerment
In 2025, the Board of Directors actively participated
in several specialized training sessions, with
training content covering:
Proportion of Independent Proportion of Female Average Tenure of Performance-Based Compensation for
Directors: Directors: Board Members: Executive Directors Accounts for No Less
Than 50% of Total Basic and Performance
Compensation
Changes in ESG regulatory rules of domestic
and overseas exchanges and their impact;
A n a l y s i s o f Lo n gc h e e r ' s c u r re n t E S G
The company has established a compensation system for directors and senior management that is linked to both corporate performance and individual assessments, in
performance and existing gaps;
accordance with the Compensation Management System for Directors and Senior Management . This system clearly defines the mechanisms for compensation payment,
adjustment, and clawback. Corporate performance indicators are composed of elements such as operating revenue, profit, and sustainable development performance.
Should a director or senior management member cause losses to the company due to improper performance of duties or involvement in illegal or non-compliant acts
such as financial fraud, the company reserves the right to deduct or suspend payment of their outstanding performance-based and medium-to-long-term incentive Proposals and plans for advancing key ESG
compensation, and to reclaim amounts already paid. initiatives.
In 2025, the company's Board of Directors and General Meeting of Shareholders operated with high standards of compliance and efficiency. A total of 14 Board meetings,
and 7 General Meeting of Shareholders (comprising 1 Annual General Meeting and 6 Extraordinary General Meetings) were held during the year. These meetings reviewed
and approved a series of significant proposals, including the election and re-election of the Board of Directors, the 2024 Annual Report and ESG Report, the issuance and
listing of H-shares, share repurchases, restricted share incentive plans, and amendments to the Articles of Association. There were no absences of Board members at any of
these meetings.
Board Meetings:
General Meeting of Shareholders
meetings held during the year
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Protect Shareholders' Rights and Interests Optimizing Investor Communication
The company places high importance on protecting the rights and interests of minority shareholders. In 2025, the The company ensures efficient and transparent communication with investors through systematic channel
company revised several policy documents, including the Information Disclosure Management System, Inside management and rigorous process control, while steadfastly safeguarding the fair right to information for all investors,
Information Management System, Rules of Procedure for Shareholders' Meetings, and Decision-Making System for particularly minority shareholders.
Related-Party Transactions , to continuously improve its governance framework and safeguard shareholder rights. The company's Information Disclosure Management System establishes the fundamental principle of equal access
Regarding the right to information, the company ensures that all shareholders can obtain true, accurate, and complete to information, strictly prohibiting any form of leakage of undisclosed material information or selective disclosure. It
information fairly and promptly through mandatory information disclosure, stringent control of inside information, also stipulates that research activities must be fully documented, jointly signed, and filed for record to ensure process
and transparent requirements for the pricing, approval, and execution of related-party transactions. traceability and content oversight.
Regarding the right to participation and decision-making, shareholders possess core rights such as proposing motions, In 2025, the company continued to deepen its investor relations management, maintaining efficient engagement
attending meetings, and exercising voting rights by proxy. In decisions involving potential conflicts of interest, such with the capital market through diversified channels. Throughout the year, the company conducted a total of 151
as related-party transactions, the company ensures shareholder opinions are fully considered in the decision-making offline research activities and reverse roadshows, and participated in 27 broker strategy conferences. Thematic events
process. This is achieved through mechanisms including mandatory abstention by interested directors/shareholders, were organized, including the annual Investor Open Day and a special research session on AI smart glasses. The
prior approval by a special meeting of independent directors, opinions from independent financial advisors, a tiered company disclosed 11 Records of Investor Relations Activities externally, and responded to 51 inquiries from minority
review procedure based on transaction amount and significance, combined with cumulative voting and separate vote investors on the SSE E-Interaction platform, achieving a 100% response rate. Through these multi-dimensional and
counting for minority shareholders. comprehensive efforts, the company effectively communicated its value and future development prospects to the
Regarding the right to supervision and remedy, the company's policies guarantee shareholders' rights to make market.
recommendations and inquiries regarding company operations (including related-party transactions), to petition
for the invalidation or revocation of defective resolutions, and to pursue judicial remedies through direct litigation or
shareholder derivative lawsuits against actions such as illegal related-party transactions. A accountability mechanism
activities, reverse roadshows,
Activity Records disclosed
rate for inquiries on the SSE
has also been established for directors and shareholders who fail to fulfill their obligation to abstain from voting,
and other events throughout the year e-Interactive platform
forming an effective system of supervision and restraint over insiders, major shareholders, and related parties.
Company Official Website, Official
Regarding property rights, the company has established a sustained profit distribution policy prioritizing cash Offline Research
WeChat Account
dividends, a fair pricing principle for related-party transactions, the right of dissenting shareholders to request
Shanghai Stock Exchange SSE
Investor
share repurchases, and the right to distribution of residual property upon the company's liquidation. These
Reverse Roadshow Events
E-Interaction Platform
Communication
measures prevent unfair related-party transactions from damaging the company's assets and effectively safeguard
Channels
shareholders' economic interests.
Announcements and
The company's protection of shareholder rights covers the entire process from information acquisition, conflict Investor Hotline, Email
Periodic Reports
of interest prevention, and governance participation to dividend distribution. This is designed to create a fair,
transparent, and balanced corporate governance environment that fully protects the legitimate rights and interests of Investor Open Day Analyst Meetings
all shareholders, particularly minority shareholders.
Investor Communication Channels
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Building Tax Transparency
Tax Management Tax Control and Training for Tax Personnel
Structure and Processes Risk Management and Departments
The company has established a Tax Department The company strictly follows process mechanisms In 2025, the company's Finance Academy continued to offer high-quality tax training courses, dedicated to
under its Finance System, responsible for group tax s u c h a s t h e CT C o m p l i a n ce Te st i n g a n d P R enhancing participants' tax compliance awareness and improving their tax management capabilities. Course
compliance and consulting. The department's main Proactive Review within the Management Process content focused on the interpretation of the latest tax regulations and policies, tax risk management, compliance
responsibilities include: planning business models, Operations framework to conduct comprehensive requirements, tax planning strategies, and international tax hot topics. Through rich case studies, special lectures,
conducting specialized tax planning, managing daily i n s p e ct i o n s a n d p ro ce s s o p e rat i o n s fo r ta x and practical exercises, participants gained an in-depth understanding of the latest developments in the tax
tax affairs, arranging and reviewing tax compliance management, ensuring the effectiveness of internal environment and effectively enhanced their ability to handle complex tax issues in actual business operations.
declarations for all group subsidiaries, and applying control mechanisms and the compliance of
Enhanced Tax Compliance
for and managing tax incentive qualifications. It procedures. In 2025, eight process CT compliance
formulates and implements the group's transfer tests were conducted within the company's core
pricing policy, and studies changes in international subsidiaries, achieving a CT compliance rate of Participants were enabled to complete tax declarations and management tasks more accurately and
tax policies and their impact on the company. 95.28%. efficiently, effectively reducing the company's risk of non-compliance
The compan y's tax m a n a ge m e n t proce s s i s For overseas tax management, the company centrally
integrated into the Financial Shared Services manages the tax compliance work of its overseas Strengthened Professional Competence
framework, encompassing five sub-modules: tax subsidiaries in accordance with the Longcheer Group
business management, tax planning management, Overseas Tax Management System, ensuring efficient Participants' professional tax knowledge and practical skills were significantly improved, assisting the
related-party transaction management , tax and compliant operations under the guidance of company in cultivating a high-level tax management team.
compliance management, and tax risk management. the Group headquarters. Additionally, the company
continuously monitors policy developments Rapid Response to Policy Changes
regarding the global minimum tax in the countries
where its overseas subsidiaries are located, and Enabled timely understanding of and adaptation to the latest developments in tax policies, ensuring the
promptly completes compliance declarations in company maintains a competitive edge in the field of tax compliance.
accordance with local regulations to respond to
changes in the international tax environment.
The Finance Academy, centered on a specialized training model, transforms practical experience into structured
courses to continuously cultivate tax professionals for the company. This system directly empowers business
operations, achieving an overall enhancement of the company's tax management capabilities. It also provides
robust support for tax risk prevention and control, laying a solid foundation for sustainable development.
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Strengthening Compliance Management
The company has established a comprehensive risk prevention and control mechanism by
building an internal control organizational system. This mechanism progressively forms
three lines of defense: business departments and related functional departments serve as
the first line of defense; internal control, financial control, quality control, and compliance
Strengthening Risk Management control function as the second line of defense; and the Audit Committee along with the
Audit and Supervision Department act as the third line of defense. The Board of Directors
Risk Management
bears the ultimate responsibility for corporate governance and comprehensive risk
Longcheer places high importance on developing its risk management system. In response to the
System and
management. It exercises supervision over internal control, risk management, and audit
compliance requirements of listed companies and the regulatory expectations of A+H dual capital
and supervision work through the Audit Committee, thereby ensuring the independence
Framework
markets, the company continuously improves its comprehensive risk management framework
and effectiveness of the risk management system.
covering strategic, operational, compliance, and ESG risks.
The company persistently refines its governance structure to align with comprehensive risk Business Management Layer / Process Owners
management. In January 2026, the Corporate Governance and Risk Management Committee was established. This progressively built a The business management layer and process owners are responsible
First
risk management architecture involving oversight by the Board of Directors, coordination promoted by the Corporate Governance and Risk for identifying, assessing, and responding to daily risks within their
Line of
Management Committee authorized by senior management, and collaborative implementation by functional departments. This structure respective business areas, resolving 95% of routine operational
Defense
facilitates the deep integration of risk management throughout the entire process of corporate governance and operational management. issues, ensuring strict process execution, and implementing process
accountability.
Internal Control and Risk Management Department / Process
Reviews and approves the Company'sfundamental managementsystemsestablishing the overarching
Management Department.
principles for risk management.
The Board of
Second The Internal Control and Risk Management Department and
Directors
The Corporate Governance and Risk Management Committee, authorized by senior Line of the Process Management Department are responsible for the
managementserves as the standing decision-making bodyfor corporate goverance and risk Defense coordinated management of high-risk matters across processes and
management lt isresponsible for formulating risk management strategies, frameworks, policies, functions, while also promoting risk management methodologies
and risk appetite:identifying and analyzing the Company's overall internal and external risks, and empowering business units.
Management completing riskprioritization, and mapping the risk landscape; approving major resource
Level
Audit Committee and Audit and Supervision Department
allocation plans, anddefining the responsible parties for each major risk and cross-functional
risk.
Third The Audit Committee and the Audit and Supervision Department
Line of conduct independent audits and investigations to objectively
Conducts risk assessments at the business level, and formulates andimplements
Execution Level
Defense evaluate the effectiveness of risk prevention and control, creating
specific response measures.
a "cold deterrent" against non-compliant behavior.
Risk Management Framework Three Lines of Defense in Risk Management
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Risk Identification, Analysis, and Response
The company focuses on key areas including operational management, financial control, supply chain systems, related-party transactions, major investments, and anti-corruption and compliance, and systematically advances
risk identification and analysis to continuously enhance its risk early warning and response capabilities. By establishing a systematic and standardized closed-loop management process, the company ensures comprehensive risk
identification, scientific assessment, timely warning, effective response, and ongoing monitoring, thereby strengthening the consistency and execution of risk management.
Risk Classification and Identification Risk Response and Ongoing Monitoring
Through its Internal Control Manual , the company For identified risks, the company establishes and continuously updates a comprehensive risk profile, clearly defining responsible Deficiencies rectified
has established a comprehensive mechanism for risk persons, corrective measures, and timelines. The risk management function tracks remediation progress on a monthly basis to and closed:
identification, control, and follow-up, with a focus on ensure effective implementation. In 2025, the company identified 237 new internal control deficiencies through focused internal
both internal and external risks. Risks are categorized into control assessments and special audits across 11 key management domains, including administrative logistics, infrastructure
four major types: strategic, financial, operational, and projects, and information systems. Together with 37 deficiencies carried over from 2024 pending closure, a total of 274 deficiencies
compliance. Multiple routine approaches are adopted for were subject to rectification. By the end of the reporting period, 201 deficiencies had been remediated and closed, representing an
risk identification, including systematic reviews through overall closure rate of 84.8%. The company maintains continuous tracking of rectificat
questionnaires and process walkthrough testing, on-site The overall closure
verification through audits and special inspections, and For each identified deficiency, the company specifies responsible departments, corrective actions, and timelines, and verifies rate is
retrospective analysis of historical risk cases. In addition,
the company has established a dynamic identification
the effectiveness of remediation through review mechanisms. For risks with significant deviations, a reporting and escalation
mechanism is in place, under which such matters are reviewed by the Corporate Governance and Risk Management Committee 84.8%
mechanism combining quarterly comprehensive risk and subject to enhanced control procedures. In 2025, several typical non-compliance cases were identified and addressed through
assessments with monthly targeted risk reviews. inspection mechanisms, and economic losses were effectively mitigated while relevant business units were required to implement
corrective actions.
Risk Assessment and Early Warning Risk Culture Development
Rele vant business leaders and experts, under the The company continues to strengthen its risk management culture through structured initiatives. It has established a Finance Training courses
coordination of financial heads at all levels, conduct Academy led by the head of the Internal Control and Risk Management Department to deliver systematic training on risk organized by the
discussions and assessments of identified risks, forming a management and internal control. In 2025, the Finance Academy organized 71 training sessions covering risk management, internal Finance Academy:
comprehensive risk profile and risk map. Responsibilities audit, and case reviews, effectively enhancing employees’ risk awareness and control capabilities and embedding risk-oriented
and control objectives are clearly assigned for each risk item. thinking into the corporate culture.
For material risks included in the risk map, the company
sets defined early warning thresholds. Once risk indicators At the same time, the company actively leverages external professional resources by collaborating with training institutions to
deviate from target levels, the relevant management teams conduct risk-oriented audit training and inviting industry experts for internal exchanges. Combined with case review mechanisms,
promptly intervene. these efforts continuously empower audit personnel and strengthen professional capabilities.
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Refining the Independent Audit and
Compliance System Supervision System
General
Meeting of
Shareholders
Compliance is the foundation for sustainable and
steady development. Longcheer places great
importance on compliant operations, promotes
the integration of compliance requirements across
all business processes, and continuously improves Audit and Supervision
CEO CFO
its internal control system to support sustainable Department
development with high standards of compliance
management.
Audit
The company has issued the Internal Control Manual Change and Process Internal Control and Risk
along with 19 implementing rules, and established a Management Department Management Department
series of governance documents, including the Internal
Control Risk Identification Procedures , Internal Control Supervision
Evaluation Procedures , Internal Audit Policy , and
Supervision and Inspection Policy . The Internal Audit
Organizational Structure of Compliance Audit
Policy clearly defines audit scope, responsibilities
and authorities, procedures, and accountability
The company has established a compliance audit structure with clear responsibilities and efficient coordination. The Internal Control and Risk Management
mechanisms. In 2025, the company revised its internal
Department, Audit and Supervision Department, and Process Management Department, together with the Operations Management units within business
control implementation rules and introduced the
departments, form an integrated internal control network to conduct independent audit and supervision over business activities, ensuring compliant operations.
Detailed Rules for Internal Supervision of Internal
Control , further strengthening its internal control The Audit and Supervision Department operates under an independent vertical management structure and reports directly to the Audit Committee, ensuring
framework. the objectivity and authority of its supervisory functions.
Organizational Independence Functional Integrity
The Audit and Supervision Department operates independently from all The Audit and Supervision Department is fully responsible for internal audit,
business units and reports directly to the Board’s Audit Committee, which supervisory investigations, and anti-fraud efforts, with independent authority
is responsible for approving annual audit plans and reviewing major audit over investigation, reporting, and follow-up on rectification.
findings.
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Audit Coverage
Through its internal audit mechanism, the company
conducts ongoing supervision of key operational
and management activities across the Group and its
subsidiaries. Audit coverage extends to all functional
departments and affiliated entities, focusing on key
areas such as financial management and budget
execution, asset management, procurement and
sales, major investments and business decisions,
infrastructure projects, and fixed asset management.
Standardized Audit
Mechanisms
The company has established standardized audit procedures and diversified audit approaches to ensure
professionalism and effectiveness.
End-to-End Process Management Categorized Audits Closed-loop Rectification
Audit work follows six stages—planning, preparation, Depending on objectives and scope, audits are Following the issuance of audit reports, the audit function formulates rectification plans and tracks
execution, reporting, rectification, and review. Upon conducted in the form of internal control audits, implementation, reporting progress to the Chairman in stages. Follow-up reviews are conducted within three
completion of fieldwork, auditors prepare reports special audits, departure audits, and other audits months after completion of rectification, with further audits conducted as necessary. The company adheres to
within a specified timeframe and communicate fully authorized by the Audit Committee. Various methods the principle of “accountability, rectification, and application” after audits, and has established a feedback
with audited entities to ensure factual accuracy and are applied, including on-site audits, off-site reviews, mechanism for audit outcomes. Regular reviews are conducted to ensure effective application of audit results
practical recommendations. In 2025, the company pre-event and post-event audits, full-process in risk prevention, management improvement, and operational efficiency.
completed the development of three core processes— tracking audits, self-audits, and joint audits.
investigation, management audit, and departure
audit—supported by 22 related documents.
In the past three years, the company has not had any audit findings referred to judicial authorities.
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Building an Integrity-Driven Ecosystem
Longcheer adheres to the principle of integrity in business operations and adopts a zero-tolerance approach to
bribery and corruption. The company has established an anti-corruption management system covering policy
development, supervision and enforcement, and cultural promotion.
Institutional and Organizational Safeguards Integrity Risk Assessment and Control
The company strictly complies with applicable laws and regulations, including the Criminal Law of the People’s To enhance the precision of risk prevention and control, the company has established and dynamically updates
Republic of China and the Company Law of the People’s Republic of China , and has established key policies an anti-corruption risk map based on historical cases. This map systematically identifies key risk areas across
such as the Code of Business Conduct for Employees, Business Redline Management Policy, Guidelines for procurement, quality, R&D, human resources, and manufacturing operations, and highlights priority risk
Accountability for Business Violations, Economic Accountability Guidelines, and Gift Management Policy. These behaviors. These risk factors are fully integrated into the annual internal control evaluation system to enable
policies clearly define responsibilities and strictly prohibit bribery, corruption, and conflicts of interest, providing ongoing monitoring of key areas.
a strong institutional foundation for integrity in operations.
The company has built a coordinated internal and external integrity defense system. Internally, audits combine
In 2025, the company updated and publicly released the Code of Business Ethics in both Chinese and English, annual full coverage with quarterly targeted inspections, and high-risk positions are subject to a three-year
covering key areas such as anti-corruption and anti-bribery, conflict of interest, information confidentiality, anti- rotation mechanism. Externally, independent third-party audits are conducted annually to assess key anti-
monopoly and fair competition, anti-money laundering and insider trading, environmental health and safety, and corruption areas, forming a robust dual-layer control framework.
whistleblowing mechanisms, further enhancing the system’s comprehensiveness and international alignment.
The company also conducts regular business ethics audits. In 2025, the Audit and Supervision Department
Anti-bribery and anti-corruption matters are overseen by the Chairman as the ultimate responsible authority, streamlined and integrated audit processes, focusing business ethics audits on 11 key management areas,
while the Audit and Supervision Department, as an independent function, is responsible for daily implementation, including administrative logistics, infrastructure projects, and information systems. Through a comprehensive and
investigation, and oversight, forming a governance structure with clear responsibilities and tiered management. refined audit evaluation system, the company ensures compliance and operational efficiency across all business
The company follows principles of legal compliance, presumption of innocence, balance of authority and processes, effectively mitigates potential fraud risks, and strengthens the compliance foundation for its global
responsibility, separation of investigation and disciplinary action, and proportional accountability. expansion and refined management.
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Whistleblowing and Whistleblower Protection
Whistleblowing and Complaint Mechanism Whistleblower Protection
Reporting Procedures
The company places high importance on protecting whistleblowers’ rights and has established and strictly
The company has established independent and Registration and classification assessment
implemented the Whistleblowing and Whistleblower Protection Policy . This policy applies to the company, its
accessible reporting channels, including a dedicated completed within 24 hours of receiving a report;
subsidiaries, and all employees, and encourages compliance among business partners. The scope of reporting
email, hotline, WeChat channel, and the Feishu- Investigation initiated within three working days;
covers various violations, including corruption, information security breaches, forced labor, and discrimination or
based “Integrity Guardian” compliance platform,
General cases concluded within 30 days, and harassment. All reports are centrally handled by the Audit and Supervision Department, with support from other
all of which are independently managed by the Audit
major cases with investigation reports issued departments when necessary
and Supervision Department. The reporting process
within 60 days.
is communicated through onboarding training and Whistleblowers may report anonymously or under their real names. The company ensures full confidentiality
sustainability reporting. of all reporting information and guarantees whistleblowers’ rights, including confidentiality, reconsideration,
response, and protection. Retaliation in any form is strictly prohibited and will be subject to disciplinary action.
In 2025, the company handled a total of 32 reports, all investigated and addressed in accordance with established Verified reports are handled in accordance with relevant policies, and whistleblowers who provide substantiated
procedures. Verified violations resulted in disciplinary actions such as formal warnings, demotion, salary and significant information may be rewarded in accordance with company regulations.
reduction, or termination of employment. Cases involving suspected illegal conduct were referred to judicial
Through institutional safeguards and independent handling mechanisms, the company ensures the fairness and
authorities in accordance with the law.
security of reporting channels, enhances stakeholder confidence in supervision, and strengthens internal risk
early warning capabilities
Reporting Channels
Reporting Methods: Whistleblowers may submit reports personally or through authorized
representatives via formal documents, letters, fax, in-person reporting, telephone, email, or
other means to the Audit and Supervision Department.
Email: audit@Longcheer.com
Hotline: 16621125566
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Integrity Management of Business Partners
The company extends its integrity requirements to the supply chain and business partners to jointly build a
clean and transparent business ecosystem. In principle, all suppliers are required to sign the Integrity and Clean
Cooperation Agreement, which defines related-party relationships and cooperation boundaries, prohibits bribery
and improper benefits, and requires suppliers to proactively disclose related-party relationships to prevent
potential conflicts of interest and improper transactions. As of 2025, the company has signed such agreements
with 1,102 suppliers.
The company conducts annual business ethics and anti-corruption audits for business partners and suppliers,
using a combination of document review, on-site inspection, and background checks. During the reporting period,
core suppliers achieved 100% audit coverage, while at least 30% of general suppliers were selected for sampling
audits. In cases of identified violations, the company will immediately suspend cooperation and take appropriate
actions depending on severity, including rectification requirements, termination of cooperation, blacklisting, or
legal action.
Through its SRM system, the company promotes annual self-assessments of integrity among suppliers. In 2025,
self-assessment reports from 934 suppliers were collected and reviewed. Procurement and audit teams jointly
conduct quarterly supplier visits to communicate integrity requirements and assess compliance on-site.
Suppliers that signed the Integrity and Anti-Corruption Agreement :
Core suppliers covered by business ethics review:
Suppliers that completed and submitted integrity self-assessment reports:
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Integrity Culture
Development
ntegrity education is incorporated into mandatory onboarding programs. Integrity Training System for Employees
The company conducts compliance training for new employees, offers
“Compliance” training for new hires
online courses such as the “One-Minute Legal Awareness” series via
Online “One-Minute Legal Awareness” courses
the “E-Flag Learning” platform, and regularly shares case studies and
via E-Flag Learning
compliance updates. In 2025, Longcheer Academy delivered 40 compliance
Monthly case briefings and awareness sessions
training sessions, and integrity-related courses on the E-Flag platform
Longcheer has established and strictly implemented Employee Training under the “Longcheer Guardian” program
recorded 7,499 participations, achieving full employee coverage.
Integrated online and offline integrity training
the Code of Business Conduct for Employees and
programs
the Guidelines for Accountability for Business
Violations, clearly defining misconduct and
requiring all employees to comply with applicable
domestic and international laws and regulations,
The company actively promotes its integrity and anti-corruption principles to suppliers, fostering a cooperative ecosystem based
uphold integrity, properly manage conflicts of
on transparency and mutual benefit. Through communication of the Integrity and Clean Cooperation Agreement , the company
interest, protect company assets, and respect the
clarifies cooperation boundaries and compliance requirements, enhancing suppliers’ proactive compliance awareness. In 2025, 17
rights of others. The company also promotes an Engagement suppliers were visited for on-site engagement.
open and inclusive culture, ensuring fair treatment with Suppliers
of global partners and colleagues and maintaining and Customers The company also conducts integrity-themed exchanges with customers and participates in customer-led compliance learning
compliant, ethical, and standardized business initiatives, with 143 participants activated in 2025.
conduct.
The company continues to strengthen its
integrity culture through diversified training and
communication initiatives, enhancing integrity
awareness and compliance capabilities among In 2025, the company launched initiatives such as incentivized reporting programs and developed bilingual (Chinese-Vietnamese)
promotional materials to enhance integrity awareness in cross-border operations.
Featured
employees and business partners.
Initiatives
As a member of the Sunshine Integrity Alliance, the company continuously improves its compliance management through external exchanges. In 2025, relevant
departments actively participated in five industry seminars and professional training programs, including anti-fraud investigation training, digital investigation and risk
control forums, regional compliance seminars, and supplier integrity system exchange events, thereby strengthening internal control and anti-fraud capabilities through
benchmarking and best practice learning.
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Promoting Fair Competition
Longcheer upholds fair competition based on the principles of fairness, integrity, and transparency. By systematically
regulating key areas—including transaction practices, marketing and advertising, trade secret protection, and
information disclosure—the company has established a comprehensive compliance framework covering the entire
business process. This framework effectively mitigates antitrust and unfair competition risks and safeguards a sound
market order.
The company adheres to lawful and compliant operations in strict accordance with applicable laws and regulations,
including the Anti-Unfair Competition Law of the People’s Republic of China. It has formulated the Integrity,
Compliance, and Anti-Unfair Competition Management Policy, which clearly prohibits various forms of unfair
competition, including but not limited to commercial bribery, false or misleading promotion, infringement of trade
secrets, defamation of business reputation, and anti-competitive practices.
In terms of governance, the Audit and Supervision Department is responsible for overseeing and investigating unfair
competition practices, reinforcing independent supervision and accountability mechanisms. Meanwhile, each
business unit is responsible for the day-to-day monitoring and risk prevention within its respective scope, ensuring
the effective implementation of localized management responsibilities. Through this coordinated approach, the
company has established a robust mechanism integrating policy formulation, supervision, and routine risk control.
Regarding marketing and information disclosure, the company enforces stringent requirements on the authenticity
and accuracy of advertisements and public communications. False or misleading statements are strictly prohibited.
All disclosures concerning product or service performance, pricing, origin, qualifications, patents, and licensing must
be truthful, accurate, and clear. Data references must be properly cited, and any content involving administrative
licensing must remain consistent with approved scopes. In addition, the company strengthens the protection of trade
secrets and strictly prohibits the improper acquisition, disclosure, or use of proprietary information.
To reinforce employees’ understanding of fair competition principles, the company integrates compliance training
into onboarding programs and provides continuous education and thematic training during employment. These
efforts aim to deepen employees’ awareness and ensure adherence to relevant laws, regulations, and internal
policies in daily operations.
In 2025, the company was not involved in any legal proceedings related to monopoly or unfair competition, nor were
there any cases involving conflicts of interest or insider transactions.
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Strengthening Data Security
Governance
Longcheer has established an information security governance framework led by the Information Security Longcheer has established and implemented a comprehensive set of information security policies, including
Committee. The Committee is chaired by the CEO, with the Head of Process and IT Systems serving as the Chief the Information Security Management Manual, Confidential Information Classification and Authorization
Information Security Officer , and heads of various functions serving as committee members. An execution team Management Measures, Confidential Information Encryption Management Standards, Employee Information
is jointly formed by department heads, departmental information security representatives, and the Information Security Guidelines, Personal Information Protection Management Policy, Information Asset Management Policy,
Security Department. A monitoring team is led by the information security lead, with heads of IT-related and Information Security Red Line and Code of Conduct.
departments as its members.
These policies form a four-tiered management system consisting of Level 1: overarching requirements, Level 2:
The Board and management oversee information security strategies, major risks, and management effectiveness management policies, Level 3: operational procedures, and Level 4: operational records. This framework clearly
through the Information Security Committee. This ensures that information security is deeply integrated with defines requirements for information classification, access authorization, encrypted storage, risk assessment, and
internal control and audit processes, while remaining aligned with the company's overall development strategy. violation handling, among other key processes.
Information Security
Committee
Information Security Information Security
Management Group Audit Group
Information Security
Execution Group
Information Security Governance Framework of Longcheer Technology
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Strategy
Data Security Risk and Opportunity Analysis
Potential
Category Description Impact Cycle Impact Level Actions
Financial
Taking into account its business characteristics,
Longcheer has elevated information security from a Establish a supply chain security framework: conduct security assessments
for all suppliers handling design data, and clearly define data protection
Core intellectual property such as responsibilities in contracts.
basic compliance requirement to a core capability
that supports sustainable business development, design documents, schematics, Short-term Implement data minimization and encryption: transfer only the minimum
Revenue
incorporating it into the company’s overall and firmware flows across multiple Medium-term High necessary data and apply encryption to design files during transmission and
decline
strategic planning. stages in the supply chain, posing Long-term storage.
risks of data leakage. Deploy secure design environments: use virtual desktops and controlled
environments when sharing design data with customers to prevent data
leakage to uncontrolled endpoints.
At the strategic level, the company follows the
information security principle of “proactive
Risks
prevention, timely detection, rapid response, and
Implement physical and network segmentation management: enforce strict
isolation and access control across R&D, testing, and production areas, and
assured protection.” It focuses on strengthening
Sensitive information control
capabilities in key areas such as supply chain data
wea k n e s s e s m a y ex i st d u r i n g Revenue establish secure network domains.
security, internal production and testing data production and testing processes, decline Strengthen full-process monitoring: assign asset tags to R&D machines and
Short-term
protection, and business continuity assurance, potentially leading to leakage of High testing equipment, track usage, and prohibit unauthorized external interfaces
Medium-term
thereby systematically enhancing information asset product appearance, performance Increase in while monitoring all data export activities.
protection and secure service delivery. p a ra m e t e r s , a n d ot h e r t ra d e direct costs Enhance personnel management: require confidentiality agreements for
secrets. personnel in sensitive positions, conduct targeted training, enforce strict
permission controls, and prohibit use of removable storage devices.
As brand customers and partners
impose increasingly stringent Continuously establish and maintain an information security management
information security requirements, system compliant with ISO/IEC 27001:2022.
information security is evolving Implement risk-based approaches to systematically identify, assess, and
Revenue
Opportunities from a “cost item” into a core Long-term High manage risks across areas such as supply chain security, production line data
growth
competitive capability. Building protection, and internal operations.
strong security capabilities can Provide a framework-based assurance for information security policies, control
become a key factor in securing high- measures, and governance effectiveness.
end orders.
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Risk and Opportunity Management
Management Process
The company has established a full-cycle risk management process covering identification, assessment, continuous monitoring, and improvement, ensuring the security
and compliance of information and data throughout their entire lifecycle.
Identification Assessment Continuous Monitoring and Improvement
The company organizes at least one dedicated During the assessment phase, the company Upon completion of risk assessment and
risk assessment annually to systematically evaluates data assets based on the three confirmation by departmental information
review information assets, including dimensions of confidentiality, integrity, and security officers and heads, outputs such as
hardware, software, data, documents, and availability (CIA). Important or sensitive the Information Asset Inventory and Key and
related personnel. Under the guidance of information is included in the Risk Assessment Sensitive Information Asset Inventory and
the Information Security Department, each and Treatment Register for focused analysis. The Risk Assessment Register are generated. For
department prepares an Information Asset evaluation considers information value, internal identified medium- to high-risk items, an
Inventory and a Key and Sensitive Information vulnerabilities, external threats, and existing Information Security Risk Treatment Plan is
Inventory. Leveraging technical tools such as control measures to identify potential risks formulated . Relevant departments implement
internet asset discovery, vulnerability scanning, across different carriers and business scenarios. remediation measures and submit a Second-
penetration testing of business systems, and A risk model is applied to quantify risk levels and Round Risk Assessment and Treatment Report
project classification management, the company generate a prioritized risk list. for verification, ensuring effective risk mitigation
proactively identifies potential risks in areas and closed-loop management.
including supply chain data flows, internal
production and testing environments, critical
business systems, and personal data processing.
Meanwhile, as customer security standards
continue to evolve, the company recognizes the
enhancement of information security capabilities
as a key development opportunity.
On a routine basis, the company continuously validates the effectiveness of control measures through monthly internal inspections, annual ISO 27001 external audits, backup and
recovery drills, and Information Security Incident Response Processes (IRP). By dynamically updating risk registers and control measures, the company promptly reflects changes in
regulations, business models, and information technologies, continuously improving the maturity of information security and privacy protection management, while transforming
security capabilities into a core competitive advantage supporting long-term development.
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End-to-End Information and Privacy Management Longcheer Information and Privacy Management
Classification and Personal information (classified into three categories) and confidential corporate information
Longcheer has established a privacy management system covering the entire data lifecycle. In strict accordance with
Identification (classified into three levels) are clearly defined and categorized.
ISO 27001 standards, security management is embedded into every stage of data processing, including collection,
transmission, storage, use, and destruction. Through data classification, access control, and encryption technologies, Collection and Adheres to the principles of legality, legitimacy, necessity, and good faith, with data collection
the company ensures end-to-end protection of user privacy across business processes, achieving zero major data Processing limited to the minimum required scope and subject to prior notification obligations.
breach incidents during the reporting year.
Storage and Employs encryption, de-identification, and backup measures, alongside strict access control
Protection and approval procedures to ensure data security.
Institutionalized Processes
Incident Response Establishes contingency plans for data breaches and a formal incident response process,
The company has established a comprehensive information security policy framework, clearly defining and Handling defining reporting, remediation, and investigation mechanisms.
Information Security Technical Protection and
responsibilities across the full data lifecycle—from generation to destruction. Tailored to different business
scenarios, policies such as the Personal Information Protection Management Policy, Data Lake Ingestion
Operational Assurance
Management Policy, Data Sharing Management Policy, and Confidential Information Classification and
Authorization Management Measures have been implemented. In 2025, the company introduced the External
Audit Information Control Rules for the Marketing System as a supplementary appendix, ensuring that data The company is committed to strengthening its security foundation through technological measures to ensure stable
processing activities are lawful, legitimate, and necessary. and continuous business operations.
Refined Technical Protection
In terms of data backup and disaster recovery, the company has established a tiered backup strategy based
on the impact of information systems and hardware on business continuity. This framework comprehensively
Advanced technical measures—including data encryption, anonymization, log auditing, and dynamic data covers key assets such as core business systems, servers, networks and security equipment, and databases, with
masking—are applied to strengthen the protection of databases and application systems. A strict access differentiated backup frequency, retention periods, and recovery objectives defined for each tier.
control model is enforced to prevent unauthorized access and ensure the confidentiality and integrity of To ensure backup effectiveness and rapid recovery in the event of disruptions, the company conducts regular
data during storage and use. backup and recovery drills to verify data integrity, the reliability of recovery processes, and the achievement of
recovery time objectives. In 2025, we completed a backup data validation drill for document data, with results
confirming that restored data was accessible and intact.
Normalized Operations At the level of business continuity management, the company has developed dedicated continuity strategies
and plans for critical IT systems and continuously strengthens disaster prevention and emergency response
The company regularly conducts privacy compliance training to enhance employees’ awareness of capabilities through regular drills.
information security. In addition, an emergency response mechanism is in place to monitor potential
risks in real time and respond swiftly. In addition, the company extends its security requirements to the supply chain. During the procurement of third-party
software, it thoroughly evaluates vendors’ qualifications and information security capabilities, while clearly defining
data protection responsibilities and penalties.
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Information Security Audit For new employees: Information security is incorporated into onboarding training to strengthen
employees’ understanding of data classification, confidentiality requirements, and personal data
The company has established an integrated internal–external, continuous- processing responsibilities.
cycle audit, supervision, and improvement mechanism to drive the ongoing
enhancement of information security management and compliance
performance. For all employees: The company organizes cybersecurity awareness initiatives—such as activities
during Information Security Month, including phishing email identification exercises—to enhance
In terms of compliance audits, the company conducts monthly internal
employees’ ability to recognize and prevent cyberattacks and data leakage risks. Through a
compliance reviews with varying focus areas in accordance with its internal
combination of routine and targeted training, the company ensures effective implementation of its
audit plan. The company has maintained certification under the ISO/IEC 27001
information security and privacy protection policies.
Information Security Management System since 2018 and successfully upgraded
to the ISO/IEC 27001:2022 standard in 2024, with annual surveillance audits
conducted thereafter. In 2025, the company successfully passed the external
surveillance audit, demonstrating continued alignment with international
Annual Progress and Targets
standards. Unified Identity Authentication System Project Risk Management Mechanism
For routine supervision, the Information Security Department is responsible During the reporting period, the company In 2025, based on the requirements of global
for auditing personal data processing activities and investigating reported ISO/IEC 27001:2022 completed Phase II of its Identity and Access key customer projects and NDA agreements,
violations. Identified issues are assigned to responsible departments for Certification Management (IAM) system, optimizing the Process and IT function established a
rectification within a defined timeframe, ensuring closed-loop management. permission models and enabling Single Sign-On project classification and grading management
To encourage internal oversight, the company has established confidential and (SSO) and refined access control across systems, mechanism, developed project security risk
non-retaliatory whistleblowing channels, including dedicated internal reporting further strengthening access management for maps, and implemented targeted control
channels and anonymous feedback mechanisms, providing employees with sensitive information. measures.
safe and reliable ways to report concerns. In addition, the company conducts
Cross-Department Collaboration Mechanism
Employee Awareness Training
annual intrusion detection assessments on critical systems by independent
third-party institutions.。 In 2025, the company formed integrated teams Information security training coverage for
Information Security Culture Development
across business units and IT departments, as new employees reached 100%.
well as a Requirements Management Team
(RMT). Through full lifecycle project review
Longcheer has established a differentiated information security culture framework tailored to the relevance of specific mechanisms, it enhanced alignment and
roles to information security: collaboration between business objectives
For new employees: Information security is incorporated into onboarding training to strengthen and IT implementation.
employees' understanding of data classification, confidentiality requirements, and personal data During the reporting period, the company reported no major information security incidents or customer data privacy
processing responsibilities. breaches.
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Environmental: Sustainability
Supporting SDGs
Longcheer attaches great importance to environmental impact management throughout the entire production and operation
process. Focusing on key issues including climate change response, energy and water resource utilization, pollutant
emissions, waste treatment, and circular economy, the company systematically advances green manufacturing and clean
production. The company continuously optimizes process flows and equipment efficiency, strengthens environmental
compliance management and emission control, and drives improvements in resource utilization efficiency and reductions
in carbon emission intensity. Meanwhile, the company extends environmental management concepts to product design and
supply chain segments, committed to achieving continuous environmental improvement and long-term value creation while
ensuring stable business development.
Our Targets
The company's general solid waste recycling rate remains stable at 90%（± 3%）
Using 2023 as the baseline year, the company targets at least a 3% annual reduction in greenhouse gas emission intensity
Using 2023 as the baseline year, the company targets a 3% annual reduction in water use (m? per 10,000 units) over the next five years.
Our Progress
Annual solar power generation: 396.43million kWh Proportion of manufacturing bases passing ISO 50001 audit: 100% During the reporting period, water consumption per unit of product
met the established target
Total annual electricity savings:742.57 million kWh Proportion of operating sites with ISO 14001 certification:100%
During the reporting period, the recycling rate of general solid waste
Total annual water savings: approximately 20,200 metric tons No incidents of penalties for violations of environmental laws remained at the target level
and regulations occurred during the reporting period
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Tackling the Climate Change
Governance
Under its ESG governance framework and management procedures, Longcheer exercises oversight and Additionally, the company actively explores mechanisms linking climate change to management operational
management of climate change-related risks and opportunities. The Board incorporates climate-related matters performance assessments. Currently, a relevant working mechanism has been established at Huizhou Base,
as specific agenda items, regularly obtains relevant information, and discusses and reviews the company's work where energy conservation and consumption reduction targets are incorporated into the base management's
on climate risks and opportunities. operational performance assessment system, with energy-saving cost reduction and per-unit OBC energy
consumption indicators set, accounting for 15% of total performance. Going forward, the company will roll out
The company has established climate-related risk management processes and mechanisms, encompassing a
this assessment mechanism across the Group based on the experience at Huizhou Base at an appropriate time.
comprehensive governance and oversight system spanning the strategic, management, and executive levels, to
ensure effective implementation of climate-related management arrangements within the organization.
Board of Directors
Strategy and ESG
The Board of Directors makes strategic decisions on climate change and bears ultimate Committee
responsibility.
ESG Executive
Committee
The Strategy and ESG Committee makes decisions on major climate change matters,
promotes internal resource coordination, and regularly receives specialized reports from the
Carbon Executive
ESG Executive Committee.
Working Group
The ESG Executive Committee is responsible for coordinating the formulation and
implementation of company environmental policies, objectives, and action plans, and
promoting the implementation of work arrangements on climate change and other issues. Organizational Carbon Emission Product Carbon Emissions
Management Group Management Group
The Carbon Executive Working Group, established under the ESG Executive Committee, is
responsible for the specific execution of climate change and carbon management work, and
reports progress to the ESG Executive Committee through bi-monthly meetings.
Longcheer Climate Governance Structure
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Strategy
In accordance with the International Financial Reporting Standard S2—Climate-related Disclosure（IFRS
S2）, the company conducts systematic identification of climate change risks and opportunities related
to its own operations, and continuously refines relevant response arrangements based on identification
results to support long-term sustainable development.
Longcheer categorizes climate-related environmental risks into two types: transition risks arising from the
low-carbon economic transformation, and physical risks directly or indirectly triggered by climate change.
Taking into account the company's business characteristics and industry context, and referencing China's
"carbon peak by 2030, carbon neutrality by 2060" goals, the company further classifies the impact horizons
of climate risks and opportunities into short-term (1 year), medium-term (1–5 years), and long-term (over 5
years) to align management and decision-making needs across different time dimensions.
The company employs scenario analysis tools, referencing the International Energy Agency's Net Zero
Emissions by 2050 Scenario, to analyze market risks that may arise within its operational scope. The
analysis focuses on potential impacts including energy supply stability, operational cost fluctuations, and
product demand volatility, thereby deepening understanding of risks and opportunities under different
climate scenarios and providing a basis for relevant strategy formulation.
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Longcheer Climate Change Risk and Opportunity Analysis
Physical Risk
Financial Affected Value
Risk Categories Risk description Impact Cycle Impact Level Risk Mitigation Actions
Impact Chain
Acute extreme weather events (such as heavy Develop emergency drill programs and establish detailed
rainfall, typhoons, and floods) may directly business continuity plans and disaster response procedures
disrupt the company’s production facilities, short-term for high-risk operational sites.
Decline in Internal
logistics, and delivery arrangements, potentially Medium-Term Medium
Revenue Operations Optimize risk transfer and financial protection mechanisms
leading to operational interruptions or delays in long-term
product delivery, thereby adversely affecting its by comprehensively reviewing and enhancing property
operating revenue. insurance programs to ensure adequate policy coverage.
Extreme weather events may pose threats to Develop emergency drill programs and organize regular drills
Acute employee health and cause damage to the Internal for employees.
Increased Costs Medium Medium
company’s property, including buildings, Operations Prioritize equipment upgrades in operational areas located in
equipment, and inventory. high-risk zones.
Risk
Analysis Ext r e m e w e a t h e r e v e n t s m a y a f f e c t t h e Diversify raw material suppliers and assess their stability
production, transportation, and supply stability of Increased Costs to mitigate the risk of supply disruptions.
raw materials, and, when combined with market Medium to Long
Decline in Medium u'p Optimize procurement and inventory management, and
fluctuations, could lead to raw material shortages Term
or price increases, thereby adversely impacting Revenue adjust raw material supply strategies in response to market
product delivery capacity. conditions and climate-related risks.
Transition Risk
Regularly track customer environmental requirements and
applicable regulations to ensure that relevant requirements
Failure to promptly identify customer requirements are identified and communicated prior to product design and
and regulatory environmental standards may result Decline in Internal production.
Compliance long-term Medium
in products that do not meet customer expectations revenue Operations Incorporate identified environmental requirements into
or comply with applicable regulations. internal management standards and production processes,
and ensure effective implementation through communication
and training.
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Opportunity
Financial Affected Value
Categories Opportunity Description Impact Cycle Impact Level Opportunity mitigation actions
Impact Chain
Integrate equipment energy consumption into routine
management requirements, and establish monitoring
By introducing high-efficiency production and evaluation mechanisms to enhance energy efficiency
equipment and optimizing process workflows, management.
Internal
Technology energy consumption is reduced, energy utilization Cost reduction long-term High
Operations Continuously reduce equipment energy consumption,
efficiency is improved, and carbon emissions are
lowered. improve production efficiency, and lower carbon emissions
by optimizing process workflows and iteratively upgrading
Opportunity equipment.
Analysis
Promote the development of green-designed and high-energy-
With increasing market demand for low-carbon efficiency products by integrating low-carbon technologies with
products, the company leverages its strengths product innovation to meet market demand.
Increase in Medium to long Internal
Market to develop green-designed and high-energy- Medium
revenue term Operations Strengthen the promotion of low-carbon products and
efficiency products, aiming to expand market
share and attract customers. communication with customers to increase market share and
enhance the brand’s image in sustainable development.
Strengthen the responsiveness of production and logistics
Enhance resilience to extreme weather events, operations to extreme weather events to ensure operational
strengthen supply chain and operational flexibility, continuity.
Increase in Internal
Management ensure continuity of production and delivery, and long-term Medium
revenue Operations Establish resilience assessment mechanisms for key suppliers
reinforce customer trust and long-term partnership
stability. and internal operational processes to enhance the ability to
cope with climate-related disruptions.
*During the reporting period, the company conducted a quantitative assessment of the current financial impact of opportunities and mitigation measures related to energy-saving technological upgrades. The expenses for energy-saving projects amounted to RMB 1.3231
million, achieving electricity savings of 7.4257 million kWh and reducing electricity costs by approximately RMB 4.6782 million. Based on actual business conditions, the company conducted a prudent assessment of climate change-related risks and opportunities, concluding
that the topic of “addressing climate change” is of high material significance. However, given the current business structure and operational model, its direct impact on the company’s near-term financial performance is relatively limited. At the same time, due to factors
such as changes in external policy environment, evolution of technological pathways, and fluctuations in energy prices, the related financial impact remains subject to uncertainty and is currently difficult to quantify reliably. Therefore, the company primarily conducts
qualitative assessments of potential future financial impacts, while continuously strengthening mitigation and management through measures such as energy-saving technological upgrades, photovoltaic power generation, and improvement of energy utilization efficiency. In
the future, the company will continue to assess and, as data and business development allow, enhance the depth and comprehensiveness of quantitative analyses of climate-related financial impacts.
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Impact, Risk and Energy Structure Optimization and Energy Conservation Practices
Opportunity In 2025, each base advanced multiple energy conservation and optimization measures based on local conditions. Certain of them have deployed distributed photovoltaic
Management power generation systems, with photovoltaic power accounting for 1.85% of total consumption, and promoted energy structure optimization through clean energy
procurement and other means.
Longcheer identifies key risk elements, relevant The company implements energy conservation and emission reduction measures at each operating base tailored to local conditions, optimizing energy structure.
responsible departments, and stakeholders to
conduct categorized assessments of various risks
and opportunities, clarifying their potential impact Huizhou Base enhances clean energy usage through green electricity Total annual electricity savings reached
on corporate operational objectives. The company procurement and distributed photovoltaic system construction. The distributed approximately
organizes functional departments and management photovoltaic project generates 3.9643 million kWh annually. Additionally,
million kWh
teams to regularly review the business environment and the base implemented a laboratory water-storage cooling system to replace
operational conditions, and analyze climate change-
conventional air conditioning, saving 423,200 kWh annually; and optimized
related risks and opportunities. Based on identification reducing CO2 equivalent emissions by
line compressed air usage, saving 1.8325 million kWh annually. Total annual
and assessment results, relevant risk control measures
electricity savings reached approximately 6.22 million kWh, reducing CO2
tons
and opportunity management requirements are
incorporated into daily operational processes to guide equivalent emissions by 379.17 tons.
the formulation and management of sustainability plans.
Nanchang Base purchases green electricity and replaces partial traditional projected to save
In alignment with business characteristics, the
company establishes sustainability goals covering short, energy with natural gas. As of September 2025, cumulative green electricity
medium, and long-term horizons, and decomposes purchases reached 17,511,000 kWh, with natural gas consumption of 122,285 million kWh
these goals to departments and production factories cubic meters. The company continues advancing energy conservation projects,
to drive implementation. Meanwhile, the company implementing nitrogen production managed services and SMT reflow oven reduce CO2 equivalent emissions by
has formulated and implemented the Carbon Target
Management Regulation in accordance with internal
and external requirements such as the Environmental
cooling energy-saving technology, projected to save 5.17 million kWh annually
and reduce CO2 equivalent emissions by 315.16 tons. 315.16 tons.
Protection Law of the People's Republic of China,
Measures for the Administration of Enterprise
Environmental Information Disclosure, and the ISO
Vietnam Base continues implementing the Energy Conservation, Greenhouse Gas Emission Reduction and Climate Change Response
for climate-related risk and opportunity management energy green certificates to support clean energy development, the base further optimizes energy structure and steadily advances
and ensuring the orderly advancement of sustainable low-carbon energy transition.
development strategy.
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Climate Training and Capacity Building Metrics and Targets
Longcheer conducts training and awareness programs on climate change and energy conservation through While balancing production, operations, and corporate development objectives, Longcheer has undertaken
multiple formats, continuously enhancing the understanding and response capabilities of employees and systematic planning of its energy utilization and emissions reduction pathways, using 2023 as the baseline year,
management regarding climate issues. In August 2025, the company organized a month-long energy-saving and continues to advance energy conservation and emission reduction initiatives. Through a combination of
management initiative, encouraging company-wide participation. During the event, 3,290 employees participated technological improvements and management measures, the company has steadily reduced energy consumption
in on-site energy-saving knowledge quizzes, generating 36 valid energy-saving improvement proposals. This intensity and, on this basis, established its “30/50” carbon targets—aiming to peak carbon emissions from its
initiative is carried forward on an annual basis. own operations by 2030 and achieve carbon neutrality at the operational level by 20501.
The group has set a synchronized target for renewable energy usage: taking 2023 as the baseline, it plans
to achieve a renewable energy share of no less than 45% by 2030. As of the end of the reporting period, the
group’s renewable energy usage accounted for 22.85%, including a photovoltaic installed capacity of 3.51 MW,
corresponding to an energy usage share of 1.85%, and green electricity accounting for 21% of total energy use.
corresponding to an energy
usage share of
including a photovoltaic
the group’s renewable energy
installed capacity of
usage accounted for
and green electricity accounting
for
Meanwhile, the company partnered with Taiwan Daywin Organization to deliver greenhouse gas general
knowledge training, covering both internal employees and key external suppliers to strengthen the dissemination
of climate-related knowledge across the value chain. The company also conducts ongoing management training
on climate change topics. In December 2025, the company organized ESG-themed training, with content covering
carbon emission reduction management requirements. 1
The company’s “30/50” carbon targets cover Scope 1 and Scope 2 emissions.
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In 2025, the company’s total Scope 1 and Scope 2 emissions decreased by 6% year-on-year. The combined
emissions intensity of Scope 1 and Scope 2 was 2.38 tonnes of CO2e equivalent per million of operating revenue,
representing a year-on-year decrease of x%..
This year, the company conducted its inaugural Scope 3 carbon emission inventory. Moving forward, while
consolidating existing emission reduction achievements, it will progressively advance Scope 3 carbon
management. Furthermore, the company plans to achieve value chain-wide carbon neutrality in phases based on
actual circumstances.
Incorporating Carbon Peak carbon emissions Achieve carbon Achieve the company's
Emissionsinto the ofthe neutralitygoals in certain operationacarbon
Company's Pilot company areas. neutrality goal
Planning
Scope 1 4,463.16 tCO2e
Formulate the Plan to have no less Plan to have no less
company’s emission than45% renewable than60% renewable Scope 2 (Market-Based) 95,954.13 tCO2e
reduction targets in energyshare energy share
accordance with the Scope 2(Location-Based) 101,197.92 tCO2e
"14th Five-Year Energy- Steadily advance the Invest in carbon capture
Saving Plan" transformation of high technology Scope 1 and Scope 2 Emissions (Market-Based) 100,417.29 tCO2e
energy-consuming
Carbon emission intensity from own operations 2.38 tonnes of CO2e equivalent per million of
equipment in key areas to
ImplementIS0 50001 and (market-based) operating revenue
Level l energy efficiency
IS0 14064 energy-related
management systems Scope 3 1,518,920.28 tCO2e
Introducing a smart Verification Criteria:
energy management ISO 14064-1:2018Greenhouse gases — Part 1: Specification with guidance at the organization level for
system quantification and reporting of greenhouse gas emissions and removals
The Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard (Revised Edition)
The Greenhouse Gas Protocol: Corporate Value Chain (Scope 3) Accounting and Reporting Standard
ISO 14064-3:2019Greenhouse gases — Part 3: Specification with guidance for the validation and verification of
Lonecheer's Zero-Carbon Strategy Plan
greenhouse gas statements
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Mitigating Environmental Impact
Environmental Compliance Management
Governance
Longcheer has established an organizational structure for environmental management, wherein the primary
factory management and administrative heads assume decision-making responsibilities for environmental
matters. The environmental management department is responsible for management and oversight functions,
while production departments and auxiliary departments serve as implementing units, responsible for executing
specific environmental management requirements and maintaining continuous control over factory environmental
management.
The company conducts environmental compliance management in accordance with applicable environmental
laws and regulations in its operating jurisdictions, adhering to the Environmental Protection Law of the People's
Republic of China, the Air Pollution Prevention and Control Law of the People's Republic of China, the Noise Pollution
Prevention and Control Law of the People's Republic of China，and other relevant legal requirements in operating
locations to carry out environmental management activities.
Regarding management system development, Longcheer has built an integrated management system covering
environment, hazardous substances, and energy management, based on ISO 14001 Environmental Management
System, ISO 50001 Energy Management System, and IECQ QC080000 Hazardous Substance Process Management
System standards. This system applies to the entire production and service processes of PCBA , mobile phones,
tablets, smart devices, wireless charging products, and related services. Through risk identification, process control,
monitoring, and data analysis, the system supports continuous environmental risk management and improvement.
The company has formulated and implemented the Environment, Health and Safety Policy . Management objectives
are tracked and evaluated monthly. Through management system operations, internal oversight, and management
review mechanisms, the company enhances the standardization and consistency of environmental management,
supporting continuous improvement in environmental performance.
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Strategy
The company has established a mechanism for identifying and updating environmental laws and regulations. Each factory identifies and updates applicable environmental legal provisions on a quarterly basis, with relevant updates
consolidated into standalone standards. Combined with ongoing compliance assessments, no significant environmental risks were identified in past evaluation processes. Concurrently, the company regularly conducts internal
environmental audits on an annual basis to review the implementation of environmental management arrangements.
Longcheer Environmental Compliance Risk and Opportunity Analysis
Impact
Category Description Impact Cycle Potential Financial Impact Actions
Level
Production project quantities, capacity Establish a dynamic EA tracking mechanism to
scales, or energy consumption levels Short-term Increased administrative penalty regularly verify project consistency with approved
High
exceed the scope approved in the Energy Medium-term expenditures. parameters, and promptly initiate EA amendment
Assessment (EA) approval. applications when discrepancies arise.
Environmental laws and regulations are
becoming increasingly stringent, which Higher penalty costs Advance clean production technology upgrades,
Medium-term
Risks leads to higher compliance expenditures for Medium I n c rea s e d e n v i ro n m e n ta l ca p i ta l optimize end-of-pipe treatment facilities, and enhance
Long-term
pollution control, monitoring, and facility investment pollutant treatment efficiency.
upgrades Rising operational costs
Non-compliance with regulatory requirements Establish a normalized environmental compliance
Decreased sales revenue
identified during environmental inspections Short-term Medium a u d i t m e c h a n i s m a n d e n h a n ce c l o s e d - l o o p
Increased operational costs
or audits, resulting in reputational damage. management processes for issue rectification.
P roa ct i ve l y e n h a n ce e n v i ro n m e n ta l
Benchmark against industry-leading environmental
compliance management to qualify for Medium-term Increased policy subsidy income
Opportunities High standards, pursue green factory certification, and
green manufacturing demonstration titles Long-term Reduced income tax expenses
secure environmental special funds and tax incentives.
and policy support.
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Impact, Risk and Opportunity Management Environmental Awareness Development
Environmental Emergency Management The company integrates environmental protection requirements into its employee training system, conducting multi-
level, multi-format environmental training and awareness programs focused on key environmental management
priorities in production operations. New hires must complete three-tier safety and environmental training to
The company has established emergency management arrangements for environmental incidents, conducting systematically master basic safety and environmental requirements. During employment, employees participate
coordinated deployment based on identified environmental risks, and continuously testing and optimizing in specialized environmental training tailored to their positions, with two environmental-specific training sessions
these arrangements through ongoing emergency drills. The company has formulated and filed the Emergency arranged annually.
Response Plan for Sudden Environmental Incidents, while each operating region has developed corresponding In 2025, each operating base advanced targeted training arrangements based on its business characteristics. Huizhou
environmental emergency management documents based on local operational conditions. Base and Vietnam Base conducted specialized training on hazardous waste management, where department liaisons
The company has established a dedicated emergency received centralized training before further disseminating the information to their respective department employees.
response team and conducts regular emergency Nanchang Base regularly organized environmental training sessions, focusing primarily on on-site environmental
drills. In 2025, all operational areas systematically control requirements, mainly covering environmental management related to auxiliary material storage areas.
fire emergency natural gas leak drill
implemented the annual emergency drill plan, carrying drills throughout the year
out two chemical spill drills, two fire emergency drills,
and one natural gas leak drill throughout the year.
Hazardous Waste Management Training
Metrics and Targets
The company establishes annual environmental management indicators and targets, monitoring implementation
through a monthly tracking mechanism to support the orderly advancement of relevant objectives. The company
has obtained ISO 14001 Environmental Management System certification. During the reporting period, the company
received no administrative penalties for environmental issues, and no major environmental incidents occurred.
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Strengthening Energy Efficiency Management
The company promotes clean production initiatives centered on energy conservation, consumption reduction, and resource efficiency improvement, Building upon the institutional system and management mechanisms, the
and conducts energy management in combination with actual production and operational conditions. By establishing energy-saving management company advanced digitalization of energy management by constructing
organizations and supporting systems, the company standardizes energy use management and drives the implementation of energy-saving measures in an intelligent energy and carbon management platform. The platform
production processes. leverages IoT and sensor technologies to collect and monitor energy
consumption data including electricity, water, and steam throughout the
The company has established an energy-saving management organization comprising an Energy Conservation Leading Group and an Energy entire production process, establishing data transmission and verification
Conservation Working Group. The base manager serves as the top executive of the Energy Conservation Leading Group, with the Human Resources mechanisms to ensure data timeliness and integrity. The platform integrates
System Director as deputy leader. The Energy Conservation Working Group consists of relevant departments including the Human Resources System, office terminal and mobile applications, achieving integrated energy data
Manufacturing System, Financial System, and Procurement System, responsible for energy conservation project advancement, technical transformation query, analysis, and management functions, supporting management
plan evaluation, corrective measure formulation, and energy conservation work inspections. personnel in real-time monitoring of energy consumption dynamics. Phase
I of the energy management platform has been launched and is operational
The company has formulated and issued multiple energy management-related policy documents, including the Energy Management Program Control
at the Huizhou base, centrally collecting company energy data.
Procedure, Energy-Related Control Procedure, Energy Monitoring, Measurement and Analysis Control Procedure, Operational Control Management
Procedure, Energy Monitoring and Measurement Instrument Control Procedure, Target Energy Indicator Performance Parameter Benchmark Control Regarding energy use efficiency improvement, the company launched a
Procedure, and Energy Review Management Procedure , to standardize energy management-related processes. Longcheer conducts energy management third-party managed nitrogen project, where the investor adopts cryogenic
work in accordance with the ISO 50001 energy management system operational mechanism. air separation technology and professional operations to lower nitrogen
supply costs. The company simultaneously implemented SMT reflow oven
In 2025, the company completed ISO 50001 audits covering all three major manufacturing bases, achieving 100% coverage. During the reporting period,
cooling technology transformation, utilizing water sources from the plant's
each base continued to advance energy-saving target planning, promoting energy conservation and consumption reduction around key indicators
refrigeration station, supplying cooling water through plate heat exchangers
including product output value, comprehensive energy consumption per 10,000 yuan of output value, and energy savings.
to meet reflow oven process requirements, replacing the original small
water chillers operation mode in workshop reflow ovens.
During the reporting period, the company implemented multiple energy-
saving projects, achieving a cumulative electricity savings of 7.4257 million
kWh and continuously improving energy utilization efficiency. At the
same time, the Huizhou facility actively promoted the use of clean energy,
The Huizhou Base continues to advance The Nanchang Base continues to strengthen The Vietnam Base achieved stable production
generating 3.9643 million kWh through photovoltaic power, further reducing
energy-saving and consumption-reduction energy management. In 2025, the planned in 2025 and simultaneously advanced energy
conventional energy consumption and supporting green, low-carbon
initiatives. In 2025, the planned comprehensive comprehensive energy intensity was 20.48 management from the initial start-up phase. operations.
energy intensity was 3.98 kgce per 10,000 yuan, kgCO 2e per 10,000 yuan, while the actual The comprehensive energy intensity was 15.35
while the actual achieved value was 3.67 kgce achieved value was 14.82 kgCO2e per 10,000 kgCO2e per 10,000 yuan, with overall operations In daily operations, Longcheer conducted energy-saving special activities
per 10,000 yuan, exceeding the target and yuan, significantly surpassing the target and maintaining a good level of energy efficiency. and three-level energy-saving training in 2025, and promoted energy
resulting in energy savings of 345 tce, further management measures such as "paperless" office measures in daily
continuously improving energy utilization
operations.
improving energy utilization efficiency. efficiency.
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Water Resource Utilization Optimization Waste Compliance Disposal
The company strictly complies with laws and regulations related to water resources and water environment, Longcheer adheres to relevant laws, regulations, and normative documents in its waste management processes,
including the Water Law of the People's Republic of China, the Water Conservation Regulations, and the including the Environmental Protection Law of the People's Republic of China, the Law on the Prevention and
Environmental Quality Standards for Surface Water. Water sources for all bases are municipal water supply, with Control of Environmental Pollution by Solid Waste, the Guangdong Province Guidelines for Hazardous Waste
no significant direct or indirect impacts on water resources due to water withdrawal, consumption, discharge, or Identification Work, the Regulations on the Safety Management of Hazardous Chemicals, POPS (the Stockholm
changes in water storage volume. Convention on Persistent Organic Pollutants), and the Law on the Prevention and Control of Water Pollution of
the People's Republic of China. The company has formulated and implemented the Three Wastes Management
Using 2023 as the baseline year, the company has set water-saving targets for the next five years, with a target of Regulations, which specify control measures for waste gas, wastewater, and noise. In 2025, the company revised
reducing water consumption per unit product by 3% annually (m?/10,000 units), and references industry water these regulations to explicitly include waste battery electrolyte in the scope of hazardous waste management.
consumption limits per unit product as management benchmarks. The company promotes water conservation
management based on production and operational conditions, and in accordance with operational needs, To ensure effective policy implementation, the company has established a robust management framework that
declares annual water usage plans to local water supply departments as required each year. clearly delineates responsibilities for waste management, designates dedicated personnel for daily oversight,
and drives compliance through regular inspections, monitoring, and targeted training programs. Concurrently,
The company gradually implements specific water-saving management measures based on the operational the company conducts environmental monitoring on schedule to ensure that waste management and disposal
conditions of each production base. Among them, the Huizhou production base is equipped with water processes meet all applicable regulatory requirements.
monitoring and metering devices for daily management, conducts regular monitoring and analysis of water
usage, and improves water efficiency through various measures. The water storage cooling system at this base In 2025, we organized environmental management-related training at various operating locations. The Huizhou
adopts a cyclic water use approach, with a circulating water volume of approximately 20,000 cubic meters and a and Vietnam bases conducted centralized training for department liaisons, who then disseminated the training
recycling rate of 2.5%. Meanwhile, the base has introduced water-saving facilities and equipment such as sensor- within their respective departments. The Nanchang base provided environmental protection training for
based water-saving faucets, and carried out water balance testing. After the implementation of relevant measures, production workshops, covering waste management and other matters.
water consumption at the Huizhou production base decreased by approximately 1.2% year-on-year, saving
approximately 20,200 tons of water annually. With its continuous water-saving efforts, the Huizhou production
base was awarded the title of "Huizhou Water-Saving Enterprise".
As of the end of the reporting period, the company had achieved its 2025 water-saving target.
Huizhou production base
circulating water volume of recycling rate of water consumption water savings of
approximately decreased by approximately approximately
cubic meters tons
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In terms of waste gas management, the company classifies and manages waste gas generated during production processes based on pollutants such as tin and its compounds and volatile organic compounds
(VOCs), distinguishing between organized and unorganized waste gas. Organized waste gas mainly includes non-methane total hydrocarbons and welding waste gas, where non-methane total hydrocarbons
Waste Gas primarily originate from processes such as reflow ovens, maintenance rooms, stencil cleaning rooms, and battery dismantling rooms, while welding waste gas mainly comes from SMT depaneling equipment.
Management Unorganized waste gas is primarily generated during manual welding processes.
For the aforementioned waste gas, the company collects it centrally through pipelines in production workshops, directs it to rooftop waste gas treatment facilities, and treats it using activated carbon
adsorption and other methods. After testing confirms compliance with relevant emission standards, the treated gas is discharged at high altitude.
The company conducts annual waste gas emission testing to ensure continuous compliance with environmental protection requirements.
The company implements classified control for wastewater management. Factory water is mainly sourced from municipal tap water, primarily used for employee domestic water and water storage cooling
Wastewater system operations. Domestic water is filtered through water dispensers before use, and the resulting domestic sewage is treated through septic tank sedimentation before being uniformly discharged to
Management municipal sewage treatment plants for centralized treatment. During production, small amounts of wastewater are generated quarterly from SMT stencil cleaning and reflow oven chain cleaning processes.
This type of wastewater is collected and temporarily stored in hazardous waste transfer warehouse after collection, then transferred and disposed of in compliance by qualified third-party units.
The company conducts wastewater discharge monitoring as required, with annual testing at domestic operating locations and quarterly testing at the Vietnam base, ensuring continuous compliance of
wastewater treatment and discharge with relevant environmental protection requirements.
Longcheer implements classified management of solid waste, dividing it into general waste and hazardous waste. General waste mainly originates from production operations and daily employee activities,
Solid Waste with general production waste including raw material packaging materials. Hazardous waste mainly includes waste organic solvents, waste engine oil, and waste light tubes. All solid waste generated by the
Management company exists in solid form.
The company signs solid waste treatment and recycling agreements with qualified third-party institutions to ensure compliant disposal and resource utilization of various wastes, and regularly tracks third-
party processing status.
Meanwhile, the company has set a solid waste recycling rate target of 90%±3%. To reduce the generation of hazardous solid waste, the company negotiates with alcohol and cleaning agent suppliers for the
return and reuse of empty alcohol and cleaning agent containers, thereby reducing the generation of hazardous solid waste.
In terms of noise management, the company completed noise reduction improvement projects in May 2025. By adding silencers at exhaust vents, relocating fans from outdoors to indoors, adding soundproof
Noise cotton and soundproof panels, and replacing louvered windows at exhaust fan outlets, the company effectively reduced noise impact. Additionally, for aging workshops, the company has implemented
Management measures such as establishing independent areas and providing appropriate labor protection equipment to reduce noise impact on the surrounding environment and employees, preventing noise diffusion.
The company conducts annual noise monitoring as required to ensure continuous compliance of noise emissions with relevant standards.
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Biodiversity Conservation
Longcheer fully complies with environmental regulations in all countries where it operates, including
the Environmental Impact Assessment Law of the People's Republic of China, the Opinions on Further
Strengthening Biodiversity Conservation, the Soil Pollution Prevention and Control Law of the People's
Republic of China, the Groundwater Management Regulations, and relevant local implementation rules,
integrating biodiversity conservation into its operational management framework. Through a systematic
environmental management mechanism, the company ensures that its business activities do not cause
significant impacts on surrounding ecosystems and biodiversity. Currently, none of the company's
operating sites are located in nature reserves or other areas highly sensitive to biodiversity.
In 2025, Longcheer did not experience any events that had a significant impact on biodiversity.
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Practicing the Circular Economy
Centered on the core principles of the circular economy—Reduce, Reuse, and Recycle—Longcheer integrates In 2025, the company also carried out multiple optimization initiatives focused on process integration and
sustainability throughout the product lifecycle, building a comprehensive system for resource recycling. By material reduction:
optimizing green manufacturing processes to reduce resource consumption and improve material efficiency,
and by promoting Design for Circularity in product development, we continuously increase the use of recycled
materials and product recyclability. This reduces the carbon footprint and environmental impact across the entire
lifecycle, solidifying the foundation of our circular economy practices. Battery Cover Production: By molding the LOGO directly during the mold forming
stage, we eliminated the original silk-screening process. This reduces paint usage and
related pollution while simultaneously lowering processing costs.
Green Process Innovation
Metal Component Manufacturing: The company adopted an integrated forging
Through the continuous optimization of manufacturing processes and production flows, Longcheer reduces process for mid-frame bezels, replacing the previous method of splitting parts,
resource intensity and improves material efficiency by eliminating unnecessary steps and material inputs, driving laser engraving, and glue dotting. This reduces part segmentation and subsequent
the production system toward higher efficiency and lower carbon emissions. processing steps, lowering material and process costs, as well as auxiliary material
and energy consumption.
Cavity-in-Stack (CIS) Technology Drives PCB Resource Reduction
Watch Mid-Frame Design: An innovative in-mold steel plate insert molding solution
To improve material utilization efficiency, the company launched a process optimization initiative for a specific
was adopted, reducing material and processing costs by approximately 10%.
product in 2025, developing Cavity stacking technology. This technology enables embedded layout and high
integration of components through precise cavity structure design, effectively saving PCB space, reducing the use
of substrate materials, and achieving a reduction in resource input.
At the same time, the company promoted multiple green manufacturing technologies, including low-VOC coatings
and solvent-free bonding, continuously streamlining production processes and technological upgrades to further
enhance production efficiency and resource utilization.
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Green Product Innovation
The company has strengthened material optimization and structural innovation at the product design stage, continuously expanding the application of recycled materials. In 2025, the average proportion of PCR materials used in the
structural components of a certain consumer product reached 28%, while the share of recycled materials in the casing of a certain power supply product exceeded 30%.
PCR Materials Drive Circular Use in Power Bank Housings Green Innovation in Smart Glasses & SIP High-Integration Technology
For a specific power bank model, the housing incorporates 30% PCR materials, reducing the consumption of virgin A certain model of smart glasses integrates circular
plastics and lowering carbon emissions during production. This material substitution enables resource reuse by economy principles in its design and development,
diverting plastic waste from landfills back into the product lifecycle. achieving green design through material reduction,
extended product lifespan, and sustainable material
Complementing the eco-friendly material choice, the project employs a refined spraying process to maintain substitution. The product employs SIP (System-in-
product texture and durability. The surface offers a smooth, wear-resistant feel with excellent fingerprint Package) technology, enabling miniaturization and
resistance, balancing long-term usability and aesthetic quality with green material application. high integration of printed circuit board components
while enhancing structural strength and chemical
At the same time, the company continued to expand the use of recycled materials in its raw materials, enhancing corrosion resistance. In terms of materials, high-
the circular utilization of product materials. strength, high-modulus lightweight metals and
engineering plastics are used, and the assembly of
flexible and rigid components is optimized to improve
deformation resistance and durability, thereby
For a specific power bank model, the housing incorporates extending the product’s service life. The product also
incorporates plant-based materials, reducing reliance
on traditional petrochemical resources and supporting
PCR materials the use of renewable materials and resource circularity.
Through material and structural optimization and
the application of high-integration technologies,
the product has achieved significant reductions in
resource consumption and environmental impact
across its lifecycle.
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The company continues to broaden the scope of recycled materials in raw components to enhance material Meanwhile, the company promotes material reduction and plastic-free design；
circularity:
重伤事故 重伤事故 重伤事故 重伤事故 重伤事故 重伤事故
In a certain tablet project, PCR The upper and lower shell In a certain laptop project, A specific smartphone product I n a ce r ta i n s m a r t p h o n e For certain product,
materials were introduced structural components (SPK the company applied 50% a c h i e v e d 0 % p l a st i c a n d project, a charger-free design eliminating the top card pin
i n t h e s p ea ke r b ox , f ro n t Box) of a certain smart glasses recycled plastic in multiple 100% recyclability in its retail reduced the weight of the paper saved 5% of white card
camera bracket, rear camera charging case use 50% PCR models of key adapters. This packaging. color box from 124?g to 73?g, material; the area and weight
bracket, and left and right (recycled plastic) materials material substitution reduces a 41% reduction, while its of full-wrap release paper were
antenna brackets, increasing to enhance the product’s reliance on virgin plastics, volume decreased by 49%. reduced by 50%; the density of
the proportion of recycled material circularity. lowers the risk o f plastic pearl cotton boxes decreased
materials in structural waste entering the natural from 25?kg /m? to 16?kg /m?,
components and reducing the environment, and effectively reducing weight by 36%; and
consumption of virgin plastics. decreases associated the domestic pallet reuse rate
carbon emissions, thereby reached 80%.
strengthening resource reuse
practices at the raw material
stage.
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Social: Sharing
Supporting SDGs
Longcheer has established a systematic Social Responsibility Management System, focusing on key areas such as employee rights, occupational health and safety,
training and development, customer privacy protection, product quality and safety, and supply chain responsibility.
Throughout product R&D and manufacturing, the company places great emphasis on data security and intellectual property protection. By strengthening quality
management and compliance requirements, we ensure our products and services meet both customer and regulatory standards.
Furthermore, Longcheer is committed to employee growth and the development of a safe working environment. We actively encourage our supply chain partners to fulfill
their social responsibilities, fostering collaboration and shared development across the entire industry chain.
Our Targets
Customer information security and yellow zone audit pass Full coverage of anti-discrimination and anti-harassment training for all employees
rate: Prohibition of any form of child labor and forced labor
provide employment opportunities for ethnic minorities and persons with disabilities, and strive to
review plan bring together outstanding talent from diverse backgrounds and experiences
Our Progress
Cumulative global authorized patents: 770 Anti-discrimination and anti-harassment training coverage in 2025: 100%
Female representation in revenue-generating functions:
Corporate Social Responsibility Agreement .
create a diverse and inclusive workplace environment and culture
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Creating Satisfied Customers
Innovating Product We continuously optimize our R&D organizational structure and establish end-to-end management mechanisms
Management
Technology across business units to strengthen business closed-loop operations and accountability.
Guided by our mission to "Create Values Through
We continuously refine our Integrated Product Development (IPD) processes, building a comprehensive system for
Technology," we have established an innovation
Processes product R&D and full lifecycle management covering multiple fields such as consumer electronics and automotive
strategy system centered on "Green Leadership,
electronics, thereby enhancing R&D efficiency and quality control.
I n te l l i ge n t U p g ra d i n g , a n d Va l u e S h a r i n g . "
By continuously increasing R&D investment,
strengthening technological reserves, and optimizing
innovation mechanisms, we are committed to driving Through regular weekly and bi-weekly meetings, we systematically review and manage key R&D topics to align
Technology
industrial progress through high-level technological technical roadmaps and facilitate forward-looking planning.
innovation, thereby assisting the smart terminal
industry in achieving higher quality and more
sustainable development.
Governance
L o n g c h e e r h a s e sta b l i s h e d a t h r e e -t i e r e d ,
interconnected R&D management system comprising
"Decision-Making, Execution, and Support." The
decision-making level is responsible for strategic
direction and industry trends; the execution level
acts as an efficient combat unit to implement
projects; and the support level provides resources,
platforms, and logistical backing. This structure forms
a clear division of responsibilities and collaborative
governance framework.
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Strategy Risk and Opportunity Identification
The company systematically identifies risks related to innovation-driven initiatives and formulates response strategies. By establishing a forward-looking analysis and judgment
mechanism, we continuously optimize our R&D system, thereby injecting sustained momentum into corporate innovation.
Longcheer Product and Technology Innovation Risk and Opportunity Analysis
Category Risk/Opportunity Description Impact Cycle Impact Level Potential Financial Impact Actions
The scope of the EU Carbon Border Adjustment Mechanism (CBAM)
Integrate green design concepts into the R&D process, continuously conduct
expands, imposing mandatory requirements on product carbon Increased R&D expenses
Medium-term High full lifecycle carbon footprint assessment and optimization, and promote
footprints. The company faces pressure to transition towards Rising carbon-related costs
products to meet international environmental standards.
green R&D.
Systematically strengthen the attraction and retention of core talents by
Intensifying competition for top talent in the technology sector,
Short-term improving the "recruitment, selection, utilization, and retention" system,
Risk with a significant gap and turnover risk for core R&D talents in High Rising labor costs
Medium-term expanding university-industry collaboration channels, and implementing
cloud computing, AI algorithms, etc.
differentiated incentives and dual career paths.
Rely on the Intellectual Property Risk Management Standards and
Growth in patent litigation cases in global semiconductor and Increased legal fees
Short-term normalized infringement investigation mechanisms to implement patent
other fields, leading to a more complex intellectual property Medium Potential increase in compensation
Medium-term early warning and avoidance during the R&D project initiation and product
environment and higher legal risks for R&D decisions. expenses
design phases, thereby reducing infringement risks.
By connecting the decision-making chain of "Strategic Planning –
Technology Planning – Technology Pre-research," systematically Establish a closed-loop technology management system from strategy to
Medium-term Improved R&D efficiency
enhance technological perception and identification capabilities, High execution, regularly conduct technology roadmap reviews and pre-research
Long-term Long-term profit improvement
providing forward-looking guidance for core technology project incubation to ensure precise resource allocation.
development.
The continuous evolution of AI large model inference-side Increased revenue share from new Develop and implement multiple AI applications, continuously invest in
Opportunity Medium-term
technology is expected to drive a new wave of industrial High products R&D for AI-product integration, and promote the large-scale application of
Long-term
technological revolution and product innovation breakthroughs. Sales revenue growth intelligent functions in end products.
Deepening industry-university-research collaboration with
Continue to advance collaborations with multiple universities on joint
universities can accelerate core technology breakthroughs and Medium-term
Medium Shared R&D costs laboratories, training bases, and special research projects, building a
outcome transformation through resource sharing and joint talent Long-term
collaborative innovation mechanism of "shared R&D, shared outcomes."
cultivation.
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Risk and Opportunity Response In the notebook
Longcheer completed the full independent software and hardware development of
its first product based on the Qualcomm Snapdragon 8 Elite platform, laying a solid
sector
foundation for itself in the high-end flagship device market.
Innovation Resource Allocation
In the smart Longcheer achieved multiple process and solution innovations and optimizations
To ensure the continuous execution and strategic implementation of R&D and innovation activities, the company wearables sector for highly integrated modules, which have successfully entered mass production.
systematically plans and dynamically adjusts the allocation of innovation resources to support sustained, high-
efficiency R&D operations.
Longcheer optimized indicators such as drop resistance and waterproof rating for its
Financial Investment: The company formulates an annual budget for the upcoming year based on business In the smartphone
smartphone products through iterative structural design and material technology,
objectives during the year-end, with quarterly rolling adjustments to ensure dynamic alignment between resource sector
more precisely meeting the diverse needs of end-users.
input and business needs.
Equipment Capability Development: The company continuously renovates and upgrades existing R&D equipment Longcheer pioneered the introduction and mass production of a TEC + active
to meet the testing and debugging requirements of cutting-edge technologies. Technical expert reviews are cooling wireless charging solution. This solution employs a dual-effect thermal
organized prior to the procurement of major equipment to ensure the advancement and applicability of management architecture combining "semiconductor refrigeration + air cooling,"
equipment selection. significantly reducing the temperature rise of the charging panel through active
In the automotive heat management. It effectively adapts to high-temperature in-vehicle operating
Supplier Management: The company maintains a diversified supplier resource pool comprising leading domestic sector conditions, enhancing cabin safety and durability. Simultaneously, the company
and international manufacturers for similar types of equipment, fostering a healthy resource supply ecosystem. All completed the full-stack independent development of a detachable automotive
specialized equipment is operated by personnel who have undergone systematic training and passed competency control screen. Based on highly integrated hardware design ensuring reliable
assessments, ensuring standardized and efficient operation. operation in harsh environments, it achieves deep integration between the control
screen and the in-cabin system through cross-domain software technology.
Currently, Longcheer has established comprehensive testing and calibration capabilities covering RF, antenna,
EMC, baseband, audio, and reliability across all product categories. Our equipment and solutions are applied to
Longcheer has gradually developed comprehensive solution capabilities in
a wide range of products, including smartphones, tablets, smart glasses, AIoT devices, AI PCs, and automotive In the smart glasses
areas such as low power consumption for extended battery life, intelligent voice
electronics. sector
recognition, image processing, and data transmission between devices.
Continuous Innovation and Breakthroughs
Currently, Longcheer has established an innovation system covering products such as smartphones and smart
tablets, continuously promoting the market-oriented and scenario-based application of its technologies.
In terms of process innovation, Longcheer has significantly enhanced product integration, performance, and
In terms of product innovation, Longcheer continuously drives product innovation and functional upgrades based
reliability by introducing and optimizing advanced processes such as System-in-Package (SiP). In 2025, Longcheer
on market demands and technological trends. It has achieved key technological breakthroughs and established a
successfully developed two SiP modules for smart glasses for the first time.
differentiated product portfolio, building multi-dimensional market competitiveness.
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AI-Enabled Innovation
The company is actively driving the deep integration of artificial intelligence technologies into core business processes
such as R&D, production, and testing. By building a unified intelligent platform and deploying multiple automation
solutions, we are systematically enhancing operational efficiency, quality control, and innovation capabilities
In 2025, the company launched the "AI Yunfan Smart Platform", achieving a 90% coverage rate of code reviews for
Sonar-detected issues, effectively supporting intelligent collaboration in internal R&D scenarios.
Innovation Capability Development
The company continuously strengthens the development of its R&D talent pool and systematically builds
core technical competencies. Through institutionalized innovation incentive mechanisms, we drive the
effective transformation and accumulation of technological achievements.
Talent and Capability Development: the company is committed to building a professional and systematic
R&D team. We focus on strengthening fundamental technical capabilities and have established a cross-
domain expert talent pool that is continuously expanded, providing solid human resource support for
Imaging Testing: We addressed Production Quality Inspection: We Software Testing: Leveraging technological breakthroughs and frontier exploration.
the standardization challenge deployed an SMT automated AI technologies such as OCR, computer
of subjective evaluations by inspection system, boosting single- vision, and visual language models, Innovation Incentives: the company has formulated and implemented an Innovation Reward System
establishing an objective metrics line inspection efficiency by 70% and we are progressively replacing and a Patent Management System . These policies provide clear incentives for the acceptance and
system. Through algorithm reducing manpower by 70%. AI re- manual labor with AI. This is authorization of innovative outcomes and patents (including inventions, utility models, and designs),
optimization and a distributed inspection time was shortened to 0.5 expected to increase test accuracy to effectively stimulating employees' innovation enthusiasm. Furthermore, the company deeply integrates
architecture, we reduced hardware seconds per image, and a centralized over 99% and improve efficiency by technology asset management and operations into its R&D system. Through mechanisms such as
costs and enabled efficient cross- re-inspection mechanism further 30%. lessons learned and product technology innovation reviews, we incorporate the accumulation, reuse,
departmental collaboration optimized staffing. and iteration of technical achievements into key performance evaluations and professional qualification
and personalized delivery assessments. This approach tightly links R&D innovation with organizational growth and employee
configurations. development, fostering a virtuous cycle of continuous innovation.
Through the large-scale implementation of AI technologies across diverse business scenarios, the company has
progressively built a digital operations system anchored in data-driven insights and intelligent collaboration.
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Intellectual Property Protection
The company places great emphasis on the creation, management, and protection of intellectual property In terms of rights protection, the company explicitly stipulates in Procurement Agreements that suppliers must
(IP). Strictly complying with laws and regulations such as the Patent Law of the People's Republic of China , guarantee their products and documentation do not infringe upon third-party intellectual property rights, and
the Copyright Law of the People's Republic of China , the Trademark Law of the People's Republic of China , and must bear all liabilities and losses arising from such infringements. This effectively safeguards the company's
the Anti-Unfair Competition Law of the People's Republic of China , we are committed to building a systematic legitimate rights and interests within the supply chain. Furthermore, the Confidentiality Agreements clearly
and standardized IP management system. This framework is designed to enhance our independent innovation define the ownership of technical information, stipulating that all intellectual property derived from confidential
capabilities and effectively mitigate IP-related risks. information by the receiving party belongs to the disclosing party, thereby protecting the company's core
intellectual property from infringement during technical collaboration and information disclosure.
Longcheer has established a dedicated IP management department, supported by patent liaisons assigned
across various business units, forming a clear and accountable management structure. Furthermore, a series of Regarding the prevention of infringing upon the intellectual property rights of others, the company has
regulations govern the entire lifecycle of IP management: established a systematic internal control mechanism:
During product development, we regularly conduct patent landscape tracking searches
Patent and Software Copyright Defines the responsibilities of all roles involved in the patent and software
and infringement risk assessments, implementing design-arounds or filing for independent
Management Process copyright application process to achieve the company's patent objectives.
intellectual property rights based on the evaluation results.
Patent and Software Copyright Encourages R&D personnel to innovate in intellectual property and
Incentive Guidelines clarifies reward standards for patents of different types and levels.
We have comprehensively implemented genuine software management for office applications,
Evaluates and classifies patents based on their technical and legal value. enforcing unified registration, regular inspections, and timely cleanup to ensure legal and
Patent Evaluation and
According to the classification results, corresponding management and compliant software usage.
Maintenance Implementation
disposal measures are implemented to rationally allocate patent expenses
Rules
and maintain high-value patent assets.
IP training has been incorporated into the mandatory onboarding curriculum for new
Standardizes information security practices during the patent application employees, strengthening their understanding of key issues such as the ownership of job-
process, controls patent information security risks, and prevents the related inventions and the protection of trade secrets to prevent potential risks. Concurrently,
Patent Information Security
leakage of confidential project information through patent documents, regular specialized training sessions are conducted on topics such as "High-Value Patent
Management Standards
thereby safeguarding the information security of both Longcheer and our Analysis and Strategy," "Methods for Reading Patent Documents," and "Fundamentals of
customers. Patent Infringement." This continuously enhances the organization's IP protection awareness
and practical capabilities, establishing a long-term protection mechanism that emphasizes
Standardizes the workflows for identifying and monitoring IP
both compliant usage and independent innovation.
Intellectual Property Risk infringement, aiming to avoid or reduce the risk of infringing upon third-
Management Standards party intellectual property rights during business operations, while
In 2025, Longcheer obtained the "Intellectual Property Compliance Management System Certification," with the
safeguarding the company's own legitimate IP interests.
system conforming to the GB/T29490-2023 standard.
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Deepening External Collaboration Upholding Scientific and Technological Ethics
To continuously enhance innovation capabilities and technological vision, Longcheer actively expands its In the application of emerging technologies such as artificial intelligence, the company places great emphasis on
cooperation network with universities and scientific research institutions. Through technical exchanges and joint technological ethics and data security. We strictly abide by laws and regulations regarding personal information
research initiatives, we promote the deep integration of industry, academia, and research. protection and data security, insisting on promoting technology implementation in a responsible, transparent,
and trustworthy manner.
In 2025, we conducted multi-disciplinary technical exchanges and learning activities with renowned universities
such as Hefei University of Technology, Hunan University, and Nanjing University. We held in-depth discussions Longcheer has established strict data and information security management systems to standardize the
on industry frontier technologies, common R&D topics, and talent development. These collaborations inject development, deployment, and usage processes of AI technologies. Throughout the entire technology lifecycle,
fresh scientific research perspectives and innovation momentum into the company, while also facilitating the we prioritize the protection of personal privacy and corporate sensitive information, employing effective technical
transformation of academic research outcomes into industrial applications. and managerial measures to prevent data leaks and abuse.
Furthermore, the company continuously strengthens employees' awareness of technological ethics, advocating a
development philosophy of "Technology for Good, Security First". We ensure that the application of technologies
like AI complies with social ethical standards and corporate responsibility requirements, driving technological
innovation to be secure and compliant.
Impact, Risk and Opportunity Management
Our Targets Our Progress
Longcheer systematically identifies, evaluates, and dynamically controls potential impacts, risks, and
opportunities throughout the R&D process through institutionalized innovation management workflows and
Annual Growth of Technical Assets In 2025, the annual growth of the company's technical assets was
technical governance mechanisms. This ensures that innovation activities are sustained in a compliant, controlled,
and efficient manner.
≥ 10% 16.6%
Metric and Target In the first half of 2025, the In the second half of 2025, the
Annual Declaration Rate of company's annual technological company's annual technological
To systematically drive the quantitative management and continuous improvement of innovation outcomes, the Technological Innovation innovation application rate was innovation application rate was
company has established an evaluation system centered on technical asset accumulation and innovation vitality.
By setting clear annual targets and regularly tracking progress, we ensure that innovation activities are closely ≥ 5.5% 5.58% 6.05%
aligned with the company's strategic development.
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Strengthening Quality Management
Longcheer consistently regards quality and safety as the
cornerstone of sustainability. By establishing a systematic
governance system, a robust risk control mechanism, and
a management framework covering the entire process,
we continuously promote the synergistic improvement
of product quality, safety compliance, and environmental
performance. This provides a solid foundation for meeting
high customer requirements and achieving long-term
development.
Governance
Longcheer has established a clear and tiered product quality governance structure to ensure the effective
implementation of quality strategies, the continuous operation of the quality system, and organizational support
for full-process quality control.
The Quality Management Department has been set up as the central coordinating and supervisory body. It
is responsible for the planning, establishment, review, and improvement of the quality system, formulating
company-level quality objectives and policies, and promoting quality culture building and cross-departmental
collaboration.
Building upon this, Longcheer has established a mobile quality system covering all product lines, embedding
quality management responsibilities into the entire business chain from R&D, procurement, manufacturing,
to service. Through procedural and standardized quality activities, this system ensures effective prevention of
quality risks and closed-loop problem resolution at every stage, including product planning, process control, and
continuous improvement.
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Strategy
Risk and Opportunity Identification
Longcheer continuously monitors various risks and opportunities arising from its quality management processes. We systematically identify, assess, and respond to these factors to drive the ongoing optimization of our quality
management system, thereby providing a solid foundation for enhancing product competitiveness and brand value.
Longcheer Quality Management Risk and Opportunity Analysis
Category Description Impact Cycle Impact Level Potential Financial Impact Actions
Establish a laboratory system capable of international certification
Global market access and compliance requirements are
Short-term pre-testing, and systematically integrate compliance assessments
becoming increasingly stringent, resulting in longer product Medium Rising operating costs
Medium-term into the product planning phase to effectively shorten certification
certification cycles and higher compliance costs.
cycles and optimize compliance costs.
Relying on a full-process quality management mechanism that spans
As product complexity continues to rise, it poses greater
Rework and after-sales costs are on 'Planning—Control—Improvement,' we strengthen cross-functional
Risk challenges to quality coordination across design, Medium-term High
the rise quality collaboration and proactive risk management to ensure
manufacturing, and testing processes.
quality consistency for complex products.
Implement rigorous supplier quality audits and Material Quality
Supply chain volatility and risks related to material
Short-term Planning (MQP) systems. Conduct full-performance verification on
consistency can potentially impact product stability and High Increased asset impairment losses
Medium-term critical materials at the R&D stage to proactively control consistency
yield performance.
risks.
Through intelligent inspection and data-driven quality Reduced material scrap and rework Construct automated testing and data-driven quality platforms to
Medium-term
control, we can achieve early detection, early warning, and High labor costs drive the evolution of quality control towards intelligence and real-
Long-term
rapid closure of quality issues. Increased sales revenue time capabilities.
Opportunity Building on a foundation of high quality, we continuously Establish a global quality certification system that spans multiple
Increased sales revenue
earn customer trust and enhance brand reputation, Medium-term regions and industries. Guided by customer satisfaction, we
High Reduced Days Sales Outstanding
providing solid support for expanding into premium markets Long-term continuously optimize end-to-end quality management to solidify the
(DSO)
and international business. foundation of brand trust.
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Risk and Opportunity Response Refining End-to-End Quality Management
Centered on the introduction of new materials, new technologies, and product quality management, the company
Enhancing Quality System Construction has established a systematic, full-process quality management system that runs through "Planning—Control—
Improvement." This ensures quality controllability and continuous optimization across all stages, from product
design to mass production and delivery.
Longcheer takes Total Quality Management (TQM) as its core principle, systematically establishing and In the Planning Phase
continuously enhancing a multi-layered quality management system that covers all business units and
operational regions. This ensures that products and services meet customer requirements, industry norms, and The company systematically identifies and manages quality risks through structured processes. The Quality
international standards throughout their entire life cycles. Assurance team organizes cross-functional analysis and evaluation of NUDD (New Unique Design Defects)
and potential design failure modes for new products and materials, forming control lists and quality planning
All major operating entities have established and maintained ISO 9001-based quality management systems. schemes. Functions such as Production, Materials, and Environmental Protection simultaneously develop
Building upon this foundation, and in consideration of specific business characteristics and customer demands, specialized plans to ensure manufacturability, material reliability, and environmental compliance are
the company has further expanded into industry-specific and customer-mandated quality certifications: implemented early in the design phase. These deliverables are then fed into the system control at key review
milestones.
In the Control Phase
The company executes strict process monitoring and node review mechanisms. The Quality Assurance team
Shanghai Longcheer Technology Co., Ltd.: Certified to ISO 9001 Quality Management System.
tracks the implementation of early-stage planning measures, monitors actual risk performance, and drives
Huizhou Longcheer: Certified under the ISO 9001 Quality Management System, and has established a closed-loop improvements, while measuring risk identification rates against monthly process indicators. Teams
medical device quality management system in accordance with ISO 13485. for Production, Materials, and Environmental Protection respectively conduct pilot-run issue tracking, material
quality monitoring, and environmental target compliance checks. Through systematic tools, they effectively
Longcheer Automotive: Certified under the ISO 9001 Quality Management System, and has established
control execution quality at every stage, ensuring products meet predetermined standards during both pilot and
an automotive quality management system in accordance with IATF 16949.
mass production.
In the Improvement Phase
Nanchang Longcheer: Certified under the ISO 9001 Quality Management System.
Longcheer Vietnam: Certified to ISO 9001 Quality Management System, and established an automotive
The company relies on project post-mortem mechanisms to drive the continuous optimization of the quality
quality management system in accordance with IATF 16949, as well as a medical device quality
system. Based on issues and improvement needs identified during post-mortems, cross-functional quality
management system in accordance with ISO 13485 and FDA 21 CFR Part 820.
improvement teams are formed. These teams systematically review lessons learned from past projects, building
a reverse improvement knowledge base, which is then updated into the quality management case system. This
ensures effective experience accumulation and iterative refinement of processes.
Through the closed-loop interaction of Planning, Control, and Improvement, Longcheer has established a full-
Through a systematic, professional, and international layout of its quality management systems, the company
process quality management mechanism that adapts to rapid technological iteration, enables proactive risk
provides each business unit with a quality management framework tailored to its product characteristics and
control, and supports continuous learning and evolution. This provides systematic assurance for high-quality
market access requirements, effectively supporting global business expansion and diverse customer needs.
product delivery and enhanced customer satisfaction.
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Consolidating Testing and Laboratory Capabilities Cultivating an Organization-wide Quality Culture
The company is committed to continuous improvement in product quality control and R&D verification efficiency The company is committed to building a quality culture characterized by all staff participation and continuous
through technological innovation and the systematic enhancement of testing capabilities. improvement. Through systematic training mechanisms and regular promotional campaigns, we continuously
enhance employees' quality awareness, professional competencies, and adherence to processes, providing
Regarding Standardization, the company's laboratories strictly adhere to both domestic and international cultural support for the outstanding performance of our products and services.
advanced technical specifications. This encompasses 3GPP communication standards, CTIA OTA certification,
the ISO/IEC 17025 reliability system, and various energy efficiency and safety certification requirements. The labs The company established a Quality Academy to systematically plan and organize diverse training sessions
possess pre-testing capabilities for international certifications such as FCC/CE and Type-C PD protocols, effectively each month, focusing on annual business priorities and capability development needs. The curriculum covers
shortening the product time-to-market. dimensions such as quality tools and methods, quality systems and red-line regulations, customer satisfaction
and issue backtracking, as well as team management and process optimization. In 2025, the company conducted
In 2025, through the implementation of several capability enhancement projects—including the construction a total of 158 internal quality training sessions, with over 12,000 participants, effectively supporting the
of a CSE pre-testing system, an EEI energy efficiency testing platform, an RF component evaluation system, enhancement of quality awareness among all employees.
PD protocol analysis capabilities, and an Image Objective Automation Laboratory—the company significantly
expanded its testing coverage and efficiency. The deployment of the RF automation platform increased test In addition to routine training, the company actively conducts quality-themed promotional activities. Through
coverage across multiple business lines, while the camera automation testing solution further standardized image systematic planning and all staff engagement, we integrate quality consciousness into daily operations and the
quality assessment. fabric of our organizational culture.
Through the continuous optimization and expansion of its technical systems, the company provides efficient
and reliable testing support for product R&D. This effectively reduces the risk of material anomalies, accelerates
product debugging and certification processes, and lays a solid foundation for quality improvement and market
responsiveness.
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Enhancing External Engagement
Quality Red-Line Improvement Month of 2025
The company actively participates in external collaboration within the industrial chain and with industry
organizations. Through multi-dimensional, routine cooperation and exchange mechanisms, we continuously
broaden our technological horizons, deepen industrial integration, and enhance our professional influence and
In September 2025, the company organized a "Quality Red Line Improvement Activity Month," promoting full
brand value within the industry.
employee participation through an integrated format of "training—examination—competition." The activity
covered 26 primary departments, conducted over 10 empowerment training sessions, organized examinations
At the level of industrial chain collaboration, the company engages in forward-looking research partnerships with
for more than 6,000 participants, and saw over 5,000 people take part in knowledge and skills competitions. This
industry partners in core technological areas such as board-level SiP packaging, optics, materials, and chips,
initiative significantly enhanced all employees' understanding and compliance with quality red lines, further
jointly promoting the ecosystem construction and technological implementation of the intelligent AI hardware
fostering an organizational atmosphere of "quality first, continuous improvement."
industry.
Regarding Industry Organization Participation, the company actively contributes to platforms such as the NearLink
Alliance, the China Electronic Audio Association, and the Shanghai Smart Glasses Industry Alliance. Through
experience sharing, topic discussions, and resource alignment, we strengthen strategic synergy with industry
partners and uncover new collaboration opportunities.
In terms of industry conferences and technical exchanges, the company hosts specialized events such as the
"Qualcomm & Longcheer Tech Day" and actively participates in influential industry summits like the VR Industry
Expo. Through these platforms, it showcases its technological achievements and gains insights into industry
trends, continuously enhancing the company's voice and technological image in its professional fields.
The activity covered conducted over
Organized examinations for more than and saw over
Shanghai Smart Eyewear Industry Alliance World Artificial Intelligence Conference 2025
In 2025, Longcheer officially joined the Shanghai Quality Association, actively participating in industry quality
knowledge and skills competitions
seminars and standard development. Furthermore, we were honored with the prestigious "2025 Outstanding
Management Innovation Model (Special Project) Benchmark Award", recognizing our excellence in management
innovation.
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Impact, Risk and Opportunity Management
The company maintains a dynamic process for identifying and grading quality risks.
Metrics and Target
The company has established a quality management indicator system covering the entire product lifecycle, with
a focus on customer satisfaction. By setting clear objectives, tracking key indicators, and driving continuous
improvement, the company achieves steady improvements in product quality.
Our Targets Our Progress
Achieved customer Quarterly Business Review E sta b l i s h e d a Q B R ta rget m a n a ge m e n t
(QBR) quality performance targets and assessment system, covering process
forecasting, improvement, and other
Annual Failure and Field Return Rate (FFR) management frameworks, to achieve customer
met standards QBR targets
Refined the quality control system, set Annual
Failure and Field Return Rate (FFR) as a key
metric for measuring product reliability, and
implemented ongoing tracking, thereby
achieving the target
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Ensuring Product Safety
Product Safety Management System Hazardous Substances Control
The company has established a safety management system that spans the entire product lifecycle. By combining Adhering to the environmental policy of "reducing hazardous substances and providing green products to
institutional regulations with digital technologies, we systematically safeguard product safety and consumer customers," Longcheer integrates hazardous substance control throughout the entire product lifecycle. Through
rights. systematic institution building and full-chain process execution, we ensure our products comply with international
environmental regulations and green requirements from key markets.
We have formulated a series of internal standards, such as the Product Safety Management Procedure and
the Control Procedure for Labeling and Traceability of Packaged Products . These documents define safety The company focuses on potential pollution risks posed by hazardous substances during raw material
management requirements from raw material procurement to manufacturing and final delivery, providing a introduction, component manufacturing, and the production process. Through full-process monitoring and
systematic basis for risk prevention. management, we ensure these substances are preventable, controllable, and traceable.
During the product development phase, Longcheer identifies potential safety risks through specialized testing,
conducting safety verifications such as battery overheat protection design and drop/anti-explosion tests to Heavy Metals Lead (Pb), Cadmium (Cd), Mercury (Hg), Hexavalent Chromium (Cr(VI))
eliminate hazards at the design source. During production, we reduce operational risks through fool-proof
equipment design and strictly control product appearance processes to avoid quality defects—such as burrs— Flame Retardants Brominated and Chlorinated Flame Retardants
that could potentially harm consumers.
Plasticizers Phthalates
Leveraging the MES system, the company has established a closed-loop product safety management system
Persistent Organic Pollutants Substances listed under POPs regulations
with full traceability. The system covers end-to-end data collection and traceability—from material warehousing
and process binding to defective product rework and final shipment. This enables precise tracking and problem Other Regulated Substances Requirements regarding WEEE, REACH, PFAS, etc.
localization based on barcodes and serial numbers, forming a safety mechanism that is "traceable, verifiable, and
optimizable." This continuously enhances our early-warning capabilities and response efficiency regarding quality
risks, providing a solid guarantee for product safety. Toxic and Hazardous Substances Control of Longcheer
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The company has established internal standards such as the Hazardous Substance Management System Manual , For raw materials, the company has established a multi-tiered supplier environmental management system to
the Longcheer HSF Management Specification , and the Longcheer List of Restricted Hazardous Substances . ensure all supply chain links meet our green standards:
These systematically regulate the control requirements for hazardous substances, establishing a management
mechanism that covers the entire product process:
Purchase orders must be placed with suppliers listed in the approved vendor list. Suppliers must
sign environmental agreements, committing to comply with our requirements.
Define general (or basic) environmental requirements to provide baseline
Product Marketing
standards for subsequent stages.
Suppliers must complete environmental certification before material approval, including
Define project-specific environmental requirements and decompose providing compliance reports such as MSDS, RoHS, HF, and REACH. Material composition data
Project Management standards to ensure all relevant departments understand and execute the must be uploaded to the company's PLM system for review.
regulations.
Suppliers must conduct XRF self-testing on finished shipments and upload the data to the PLM
Design according to defined environmental requirements. Assess material
system. The company uses this to verify their testing capabilities, equipment accuracy, and the
R&D & Design Selection risks—especially whether high-risk materials contain banned substances—
effectiveness of their shipment interception mechanisms.
prior to selection.
Communicate environmental requirements to new resource R&D and The company organizes annual environmental training for suppliers to continuously communicate
Resource Development &
certification processes. Only new resources that pass acceptance can be and update environmental policies and regulatory requirements.
Projects
used.
Verify raw material environmental compliance. Implement risk-based
Our Target Our Progress
IQC & Laboratory tiered management of testing equipment and methods to ensure
incoming materials meet standards.
In 2025, the company did not use PVC materials in its
Purchase and deliver materials according to environmental requirements, PVC Prohibition
Procurement products.
ensuring every link in the supply chain complies with regulations.
Halogenated Flame Retardant In 2025, the company did not use halogenated flame
Prohibition retardants in its products.
Implement pollution control measures during manufacturing to prevent
Production In 2025, Longcheer, Longcheer Intelligence, Huizhou
environmental contamination.
Longcheer, Nanchang Longcheer, and Vietnam
Expand QC080000 Certification Scope
Longcheer all passed the IECQ QC080000 Hazardous
Prevent mix-ups by ensuring clear and accurate material identification,
Warehousing & Logistics Substance Process Management System certification.
avoiding cross-contamination between different materials.
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Non-Conforming Product Control
Longcheer strictly enforces the Non-Conforming Product Control Procedure , implementing Non-Conforming Product Management Coverage
systematic management of abnormal products during production. Through precise
traceability, effective isolation, and standardized rework measures, we ensure non-
conforming products never flow to the next process or into the market. Regarding after-sales
customer complaints, the company has established a clear product recall management Non-Conforming Functional Non-Compliance Equipment HSF Non-
Isolation and Rework and
mechanism, including trigger conditions, impact scope, and standard operating procedures. Product Defect Control with Classic Handling Conforming Product
Disposition Repair Products
This forms a standardized recall system covering customer communication, after-sales Traceability Mechanism Requirements Methods Handling
handling, and logistics coordination.
Longcheer Non-Conforming Product Management Coverage
Development Phase/Verification & Release Phase
Initiate After-Sales Confirm Product
Customer Return Path
Return Return
Customer Service Customer Service Coordinate After-
Representative Agreement Review Sales Requirements
Accept After-Sales Arrange Product Returned Product
After-Sales Repair
Task Return Warehousing
Delivery Logistics Arrange Return Path
Longcheer Product Recall Process
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Enhancing Customer Service Improving Service Organization Structure
Improving Customer Service Quality
To ensure the effective operation of the quality and after-sales service management system, the company
continuously improves its customer service organizational structure and responsibility allocation mechanism.
It has established a service management model centered on customer service representatives, supported
The company has established and continuously refines a product quality monitoring and after-sales service by extended team collaboration, achieving unified management of customer needs from identification and
indicator system. By deploying a professional technical support team and a 24/7 response mechanism, we assessment to response and maintenance.
effectively reduce the product's Annual Field Failure Rate (FFR) and repair rate, transforming product value into In 2025, the company further refined its customer service organization and responsibility system. Based on the
tangible customer benefits through refined, professional service. customer service division of labor, and through the defined responsibilities of customer service representatives
and their extended teams, customer needs—from identification, assessment, and response to maintenance—are
To systematically enhance quality and after-sales service management capabilities, we have built a regulatory
brought under unified management.
system covering service strategy formulation, agreement review, proactive serviceability management, and
continuous quality improvement. In 2025, the company's marketing system MSM1.0 continues to serve as the main channel of the company's
marketing system, supporting the end-to-end marketing business process operations covering market
Front-end Service Management: The company standardizes the review of after-sales service strategies management, customer management, and sales project management.
at the project initiation stage through the Management Service Strategy document, strengthening the Building upon the original MSM system architecture, 71 new L3 to L6 level processes were established and refined.
management of service costs and gross profit. Furthermore, the Customer Service Agreement Review This further standardizes the company's marketing business activities and marketing operations, continuously
Process clarifies responsibilities and time efficiency standards for reviewing customer RFI/RFP/RFQs deepens customer relationship management, and promotes more standardized, orderly, and process-driven sales
and service terms, enhancing risk identification and proactive control. activities.
Product Lifecycle Management: the company has established the Product Serviceability Review
Management Process , which incorporates serviceability requirements upfront during the product
concept, development, validation, and release phases to reduce after-sales risks at the source.
Simultaneously, through the Service Quality Management policy, the company continuously monitors
and analyzes quality performance during the initial launch phase of new products as well as medium-
to-long-term quality data (such as FFR indicators), driving systematic improvement and optimization
of quality issues.
In 2025, we further strengthened its digital quality management capabilities by officially launching the Feishu-
QMS interactive closed-loop problem management platform. This platform facilitates tiered control and process
management of client-side issues. By utilizing progress notifications, to-do reminders, and email escalation
mechanisms for overdue tasks, the platform provides full-process alerts to reporters, responsible parties, and
relevant personnel. It continuously tracks issue resolution progress until closure, significantly enhancing the
efficiency of response and handling.
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Optimizing Customer Feedback Processes Efficiently Responding to Customer Needs
Adhering to the customer-centric service philosophy, the company continuously improves its customer service Longcheer values customer feedback management and systematically collects customer opinions and suggestions
and complaint response systems. We have formulated and implemented a series of regulatory documents— regarding product quality and service performance through multi-channel communication.
including the Hierarchical Problem Handling Guidelines, Product Quality Improvement Process, Production
Quality Abnormality Handling Process , and Market After-Sales Complaint Handling Process —to systematically The company continuously operates the Customer VOC (Voice of the Customer) system for closed-loop
standardize service and after-sales issue resolution. management. We regularly organize management meetings to review and evaluate the progress of VOC closure.
By verifying the effectiveness of improvements against customer feedback and QBR/MBR performance results, we
The company continuously optimizes its response system, integrating a full-service chain covering five key transform customer insights into tangible achievements of continuous improvement, comprehensively enhancing
modules: "Service Strategy, Service Execution, Service Quality, After-Sales Repair, and Problem Resolution." customer experience and satisfaction.
When customer complaints or feedback arise, the company follows established procedures to organize cross-
Manage VOC Regularly organize high-level meetings to analyze customer needs and
functional teams for issue assessment and resolution. Implementation measures are carried out with customer
Implementation pain points, strengthencustomer-oriented decision-making response
approval, and continuous tracking is maintained until the issue is fully closed. For urgent issues, the company
adheres to the "2-4-24-48-5" time-based management principle: acknowledge and respond within 2 hours,
complete issue documentation and coordinate with relevant functions within 4 hours, conduct preliminary root
cause analysis within 24 hours, develop a solution within 48 hours, and complete long-term corrective actions and Through QBR/MBR assessment mechanisms, maintain regular
Manage QBR/MBR
effectiveness verification within 5 business days. This ensures that issue handling is efficient, transparent, and communication with customers,and implement standardized closed-
Assessment
well-controlled. loop management for dissatisfactions/issues
Continuously conduct annual satisfaction surveys, combine
questionnaires and interviewsto dynamically understand customer
Manage Annual Customer
evaluations of work in various fields, promptly collectcustomer opinions
Satisfaction Survey
and suggestions, formulate responsive corrective and preventive
measuresand improve product service capabilities in a targeted manner.
Customer VOC Management Process
In 2025, the company continued its annual customer satisfaction survey, managing customer feedback
systematically and via closed-loop processes. The survey, conducted through a combination of on-site and online
interviews, covered key business areas including marketing, quality, R&D, delivery, manufacturing, and products,
comprehensively collecting the Voice of the Customer.
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CSR Audits Advancing a People-Centric Philosophy
To meet the growing Environmental, Social, and Governance (ESG) expectations
of our global clientele, the company has established a systematic coordination
mechanism for CSR audits. Through standardized processes, dedicated point- Safeguarding Employee Rights
of-contact management, and continuous improvement, we ensure that our
operations and products align with the diverse sustainability standards of
domestic and international customers. The company upholds employee rights protection as the cornerstone of corporate development, strictly complying with applicable laws and
regulations in operating locations, including the Labor Law of the People's Republic of China, Labor Contract Law of the People's Republic
For International Clients, we actively cooperate with ESG data reporting and audit of China , and Vietnam's Labor Code. The company also actively adheres to international standards such as the UN Global Compact Ten
requirements. This includes completing self-assessment questionnaires, providing Principles, Universal Declaration of Human Rights , and the ILO Declaration on Fundamental Principles and Rights at Work , committed to
third-party sustainability scorecards, disclosing carbon emissions and product creating a fair, safe, and healthy working environment for every employee.
lifecycle assessment data, and submitting verification documents for recycled
materials. Furthermore, we regularly participate in monthly CSR meetings with
clients, conduct annual ESG self-evaluations, perform new factory audits, carry
out conflict minerals surveys, and undergo RBA (Responsible Business Alliance)
audits. Through our annual ESG report, we enhance supply chain transparency
and accountability.
For Domestic Clients, addressing specific client concerns, the company
systematically responds to audit requirements regarding carbon management,
labor rights, workplace safety, environmental protection, technology ethics,
and care for special groups. By conducting specialized CSR audits, refining
environmental and social management systems, promoting carbon reduction
initiatives, and improving ESG ratings, we have built a responsibility framework
that meets domestic market and societal expectations, supporting clients in
project bidding and long-term partnerships.
We have established a mechanism for recording and archiving customer ESG
requirements, ensuring audit documentation is complete and traceable.
Through cross-departmental collaboration, we drive continuous improvement,
transforming customer ESG expectations into intrinsic drivers for management
enhancement and business development.
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Workplace Rights Protection
Non-discrimination and Anti-harassment Prevention of Child Labor and Forced Labor
Longcheer commits to eliminating discrimination or differential treatment based on race, color, religion, gender, Longcheer commits to resolutely eliminating the employment of child labor and prohibiting any form of forced or
age, nationality, genetics, disability, or other factors in recruitment, promotion, compensation, performance compulsory labor.
management, and daily operations. Any form of sexual harassment, inappropriate remarks, or misconduct is
strictly prohibited. During the recruitment process, the company strictly adheres to internal policies and regulations to prevent
the employment of child labor from the outset. During the hiring phase, interviewers rigorously review the
To effectively prevent and address discrimination and harassment, the company has formulated the Regulation documents submitted by candidates and verify whether they have reached the age of sixteen based on the
on Prohibition of Discrimination and Inhumane Treatment , and established clear reporting and handling personal information provided. When processing onboarding formalities, HR staff verify the candidate's actual
mechanisms. Employees may report through designated email of the Ethics Management Office, local ethics age by checking the original ID card, compare the individual's appearance with the photo on the ID, and use
working groups, or directly to office members. During case handling, the company will impose appropriate facial recognition devices to authenticate the ID's validity. To prevent oversights and identity fraud, the Human
penalties on violators while providing support to victims including communication, reassurance, and outcome Resources department conducts periodic spot checks. Should any age-related complaints or doubts about an
notification. When necessary, the company will assist in adjusting work positions or locations to alleviate employee's age arise, the company will immediately initiate a review process to re-verify the individual's actual
subsequent pressure. age.
In recruitment, the company ensures fairness and equity through multiple measures. At the institutional level, Meanwhile, the company has formulated the Regulation on Prohibition of Child Labor and Protection of Young
the Human Rights Policy and Guidelines on Relatives Avoidance are formulated in accordance with the Labor Law Workers and the Regulation on Freedom of Employment and Prevention of Forced Labor , clearly defining remedial
of the People's Republic of China and Employment Promotion Law of the People's Republic of China , explicitly measures and internal reporting procedures for child labor incidents or forced labor situations, ensuring timely
prohibiting all discrimination unrelated to job requirements. Recruitment information is reviewed to avoid identification and proper handling of issues.
unreasonable restrictive conditions. The interview process adopts a structured system with standardized scoring
to reduce subjective judgment influence. Background checks strictly follow legal compliance and job-relevance Additionally, the company organizes specialized training during employee onboarding, conveying policies
principles, and candidates are provided with opportunities for explanation to avoid rejection decisions based on and requirements on prevention of child labor and forced labor through combined online and offline formats,
personal attributes. enhancing awareness and responsibility among all employees to jointly maintain an equal, free, and dignified
working environment.
In awareness enhancement, the company continuously conducts online and offline training on anti-discrimination
and anti-harassment themes, achieving full coverage of relevant content in 2025.
Our Targets Our Progress
Our Targets Our Progress
Achieve 100% employee coverage of anti- In 2025, 100% coverage achieved for anti-
Prohibit any form of child labor and forced
labor.
In 2025, the company recorded 0 incidents of
discrimination and anti-harassment themed training. discrimination and anti-harassment themed training. child labor or forced labor.
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Diversity, Equity and Inclusion Human Rights Due Diligence
The company upholds the core principles of "Diversity and Inclusion, Equal Opportunity," committed to building a The company has formulated and issued the Regulation on Identification and Assessment of Labor and Ethical
work environment that respects differences, embraces diversity, and ensures equity and fairness. We ensure that Risks , established a register of significant labor risks, and set corresponding risk identification and management
no employee faces discrimination or differential treatment in recruitment, promotion, training, or compensation objectives to systematically identify, assess, and respond to potential human rights-related risks.
and benefits based on gender, age, ethnicity, religious belief, educational background, or physical condition. We
advocate that employees actively listen to diverse perspectives and embrace different viewpoints in collaboration In actual operations, Longcheer collects information through employee satisfaction surveys, symposiums, daily
and decision-making, thereby stimulating organizational innovation, enhancing team cohesion, and strengthening feedback channels, and other means, regularly assessing the severity and probability of human rights risks to
employee belonging. determine prioritization for risk treatment. For high-risk areas, we develop specialized improvement measures,
strengthening workplace environment optimization and supplier conduct management. The company regularly
Except where special job requirements apply, the company is dedicated to promoting employment for persons tracks and evaluates risk status and improvement effectiveness, dynamically adjusts management strategies, and
with disabilities, providing equal employment opportunities for disabled individuals in hiring practices. reports risk progress to management. Meanwhile, we regularly disclose risk management status to stakeholders,
Meanwhile, we continuously pay attention to the practical needs of ethnic minority employees, improving relevant establish and maintain feedback channels, and continuously improve the human rights risk management system.
convenience facilities. We have established dedicated halal food counters in company canteens, respecting and Additionally, the company enhances all employees' awareness and management capabilities regarding human
accommodating employees' different dietary cultures and religious customs. rights risks through regular training.
In talent development, we systematically integrate topics such as diversity, inclusion, and unconscious bias into Furthermore, the company has established effective grievance and remediation mechanisms to ensure affected
various training systems, covering new employee cultural orientation, management development programs at parties receive timely response and reasonable redress.
all levels, and internal trainer cultivation. When reviewing monthly training plans from professional academies,
Longcheer Academy treats inclusivity of training content and participant composition as an important evaluation
dimension, driving continuous optimization of the learning environment toward greater openness and inclusivity.
Our Targets Our Progress
Create an equitable and inclusive In 2025, the company provided employment
environment, foster a diverse and inclusive
opportunities for persons
workplace culture, provide employment
opportunities for ethnic minorities and
with disabilities and individuals from
persons with disabilities, and strive to bring
together outstanding talent from diverse ethnic minorities, striving to create a diverse and
backgrounds and experiences. inclusive workplace environment and culture.
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Advancing Internal Dialogue Face-to-Face with General Manager in 2025
Improving the Communication System
Longcheer is committed to building an institutionalized, platform-based, and all-staff communication and service In 2025, to promote direct communication between frontline employees and senior management, Huizhou
system that breaks down hierarchical and geographical barriers, ensures smooth information flow and efficient Base continued the "Face-to-Face with General Manager" series. This platform focused on the actual needs of
response to employee concerns, solidifies the foundation of organizational trust, and enhances collaborative frontline permanent workers and team leaders, holding 5 employee symposiums and 1 team leader symposium
effectiveness. throughout the year. Through direct dialogue with the General Manager, employees were able to voice difficulties
and suggestions regarding work and life, driving efficient information transmission and promoting timely problem
We have established a multi-dimensional communication mechanism spanning "strategic Consensus— response.
Management Optimization—Daily Care," systematically collecting and responding to employee voices, promoting
normalized cross-level dialogue, achieving efficient and convenient information access, and ensuring clear and
smooth problem-solving pathways.
Strategic
Consensus
Through formats such as Talk with President and executive information sharing sessions, ensure alignment
between company development direction and employee understanding, building strategic trust.
Management
Optimization
Relying on various business systems, conduct democratic life meetings and regular specialized symposiums,
focusing on operational-level issues such as team management, process efficiency, and welfare logistics,
transforming employee suggestions into concrete improvement measures. To enhance organizational communication efficiency and transparency, Longcheer has built a digital workplace
integrating "Information Dissemination, Interactive Engagement, and Self-Service." Platforms such as "Longtan"
(internal forum), "Longcheer Style," and "Longcheer Recruitment" serve as official information channels,
Daily Care
continuously communicating company business updates, policy interpretations, and cultural stories. Meanwhile,
employees can conveniently handle various HR matters—including personal information queries, certificate
Through employee satisfaction surveys and various care activities, continuously monitor organizational issuance, document updates, and leave applications—through the "MyHR Employee Self-Service Platform" and
atmosphere, infuse humanistic warmth, and closely integrate listening to employee voices, implementing daily unified service portal. Managers can also access team information in real time and complete daily approvals
care, and driving continuous management improvement. through the same platform.
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Employee Satisfaction Survey
Updated 2025 "Longtan" Platform Launch
To continuously monitor and enhance the overall employee experience within the organization, Longcheer has
established a normalized, multi-dimensional employee satisfaction research mechanism. Through specialized
surveys covering onboarding experience, in-service support, environment and logistics, career development,
In July 2025, the Longtan platform underwent a comprehensive upgrade and launch. Centered on the positioning
performance feedback, and system support, the company systematically collects employee opinions, providing
of "An Ideal Employee Communication System," it integrated 8 core columns and 30 interactive sections, covering
data support for management optimization and decision-making, and driving continuous organizational
multiple dimensions including cultural dissemination, management exchange, administrative services, and
improvement.
employee life. Since its launch, the platform has continuously diversified its operational formats, successively
organizing 9 online cultural activities including essay contests, photography exhibitions, and themed discussions, In terms of onboarding experience, the HR Shared Service Center continuously conducts new employee
and launching featured columns such as executive research papers and "We Light" story sharing. satisfaction surveys. As of 2025, the onboarding experience questionnaire has undergone four iterations, covering
over a thousand new employees throughout the year, with an overall satisfaction score of 4.65 (on a 5-point
As of December, the platform had accumulated over 100,000 visits, with more than 10,000 active users, and
scale). The survey results support cross-regional comparisons and regional differentiation analysis, helping to
published 557 articles and interactive content pieces. It has effectively facilitated precise communication and
identify process gaps and drive targeted improvements. Additionally, based on survey performance, the company
deep recognition of company strategy, culture, and objectives among employees, becoming an important vehicle
recognizes outstanding service teams, leveraging real-time incentives and sharing best practices to continuously
for internal organizational communication and cultural development.
enhance service quality.
In terms of living Experience, the Administration Department has conducted multiple surveys regarding employee
office and living facilities, including cafeteria vendor selection, parking space planning, first aid training needs,
and annual administrative service satisfaction assessments, gradually building a feedback closed-loop spanning
the entire employee lifecycle and covering multiple scenarios, driving continuous improvement in organizational
environment and employee experience.
Since the second half of 2024, Longcheer launched an
organizational climate survey project, piloting it in select
business divisions in 2025. The survey covers dimensions
including basic requirements, value realization, team
belonging, and mutual growth. Through analytical methods
such as team average scores, individual question data, and
regional comparisons, it identifies management weaknesses
and focuses improvement directions. Survey results are
simultaneously fed back to respective management teams
to jointly formulate and implement improvement plans,
supporting dual optimization of management capabilities （Nanchang）Employee Satisfaction Survey by
and team atmosphere. HR and Administration
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Ensuring Health and Safety
Longcheer consistently positions health and safety at a strategic level. By establishing a sound governance structure and institutional framework, systematically conducting risk identification and response, and continuously driving
system certification, hazard protection, inspection drills, and supplier collaboration, the company is committed to building a long-term mechanism for occupational health and safety management that leads the industry, providing solid
and reliable safety protection for employees and business operations.
Governance Strategy
Risk and Opportunity Identification
The company always places the health and safety of employees and
stakeholders first, strictly complying with laws, regulations, and industry Through its annual workplace safety work plan, the company establishes a normalized risk identification and assessment mechanism, promoting the
standards in business management. Upholding the philosophy of "Safe continuous development of safety management in a systematic, preventive, and leading direction.
Production, Caring for Employees, Scientific Management, and Continuous
Improvement," the company systematically builds and continuously Health and Safety Risk and Opportunity Analysis
improves its occupational health and safety management system. We
are dedicated to preventing safety accidents, enhancing emergency Category Description Impact Cycle Impact Level Potential Financial Impact Actions
response capabilities, reducing operational risks, and driving continuous Enhance regional traffic safety by
Risk of intersection between
improvement in health and safety management performance through Short-term Increase in compensation for implementing physical barriers and audible
internal traffic flow and personnel Low
institutional norms, responsibility implementation, and normalized Medium-term personal injury accidents & visual warning measures to control vehicle
activity areas in the workplace
access and movement
inspections.
Systematically conduct facility health
Aging equipment and facilities
monitoring and preventive maintenance,
The company has established a Safety Production Committee and may pose potential hazards to the Medium-term Low Increase in maintenance costs
Risk promote the upgrade and renovation of
formulated the Safety Production Committee Charter , clarifying environment and safety
aging facilities
organizational structure and management responsibilities. The committee Deploy smart fire protection systems,
coordinates the development of annual safety production work plans, Local weaknesses exist in the Increase in fire rectification continuously carry out fire safety
systematically conducts risk inspections and hazard rectification, and park's fire protection system and Short-term Low expenses assessments and security reinforcement
ensures systematic advancement of safety management. In 2025, the security system Increase in property losses projects to enhance overall emergency
response and protection capabilities
company comprehensively identified and updated the list of occupational
Through systematic safety Promote the digital and intelligent
health and safety-related laws and regulations and organized all employees
management and technological transformation of safety management,
to sign annual safety responsibility agreements, consolidating the safety Medium-term
Opportunity investment, an industry-leading High Reduction in safety risk costs positioning health and safety development
Long-term
responsibilities at every level. security system and safety culture as a competitive advantage for the
can be established company's sustainable development
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Risk and Opportunity Response Through systematic certification and regular external testing, the company continuously strengthens the
institutional foundation and implementation guarantee of its health and safety management, creating a safe and
System Certification and External Testing compliant working environment for employees.
Hazard Prevention Mechanisms
The company places high importance on the systematization and compliance of occupational health and safety
management, continuously promoting international certification and external testing of its management system.
Through regular, specialized internal and external assessments, it ensures that all health and safety indicators
Longcheer places high importance on the prevention and control of various occupational hazards during its operations.
consistently meet national standards and industry regulations.
By combining engineering controls with personal protection, it has established and continuously improves a hazard
prevention system covering multiple scenarios across all its bases.
In terms of system certification, both the Huizhou Base and Nanchang Base have passed audits by T?V
certification bodies and obtained ISO 45001 Occupational Health and Safety Management System certification. At the engineering control level, Longcheer has formulated policy documents such as the Environmental Occupational
Both locations implement an annual review mechanism to ensure the continuous and effective operation of the Health and Safety Management Manual, Regulations on the Management of Labor Protection Supplies , and Regulations
system. on Occupational Disease Prevention Management . These documents systematically identify positions with occupational
hazards and standardize protective measures. Each base has installed occupational hazard warning signs, equipped
In terms of external testing and compliance monitoring, the company regularly commissions qualified third-party areas with general ventilation and local exhaust systems, implemented regular job rotation for key positions, and applied
institutions to conduct testing and assessments on key environmental and safety indicators. source isolation and engineering controls for chemicals, noise, hazardous gases, etc.
In terms of personal protection, Longcheer provides and instructs employees in relevant positions on the use of personal
In 2025, successively completed testing for wastewater, exhaust gas, noise, kitchen protective equipment, such as protective gloves and earplugs. All employees exposed to occupational hazards undergo
Huizhou fumes, lightning protection devices, occupational hazard factors, and electrical fire pre-employment, periodic in-service, and pre-departure occupational health examinations. The occupational risks of
Base prevention. All results complied with national standards, and corrective actions were their positions are clearly communicated to them through the Occupational Hazard Notification Letter .
implemented to close out any issues identified during the testing. Regarding hazardous chemicals, Longcheer strictly complies with relevant national laws and regulations. In accordance
with standards such as the Regulations on the Safety Management of Hazardous Chemicals , it has formulated the
In 2025, systematically conducted multiple tests including organized exhaust gas, Chemical Safety Management Specifications , which comprehensively cover all stages of chemical handling—including
introduction, warehousing, storage, use, recovery, and emergency response—ensuring the safety and control of
Nanchang
unorganized exhaust gas, boundary noise, kitchen fume emissions, boiler exhaust gas,
chemicals throughout their lifecycle.
Base
lightning protection, occupational hazard factors, and electrical fire prevention. All
results were qualified, with simultaneous implementation of corrective actions and During the chemical introduction phase, Longcheer has established a rigorous evaluation mechanism. For all newly
follow-up verification. introduced chemicals, the Purchasing Department is required to collect relevant qualification documents, including
Material Safety Data Sheets (MSDS), business licenses, and operating permits. These are then subject to a safety
assessment by the Safety Assurance Section. Only chemicals that pass this assessment can proceed to the procurement
In 2025, successively completed testing for wastewater, exhaust gas, noise, kitchen
Vietnam
process, ensuring the effectiveness of source control. Concurrently, Longcheer implements full lifecycle management of
fumes, lightning protection devices, and occupational hazard factors. All results
Base
MSDS, ensuring their information is complete and valid, and regularly organizes review meetings to promptly update any
complied with national standards, and corrective actions were implemented to close
non-conforming items.
out any issues identified during the testing.
Longcheer implements refined management for the storage and use of hazardous chemicals. A quantitative storage
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system is enforced in the chemical transit warehouses, strictly controlling the inventory not to exceed a 24-hour supply. The warehouses are equipped with Strengthening Safety Training
comprehensive protective facilities and emergency supplies, which are regularly inspected and maintained. Chemicals with incompatible properties are stored
in separate areas with isolated management to prevent safety incidents caused by cross-reactions. All storage containers are clearly labeled with the product
name, properties, and warning signs to ensure information transparency and traceability. Longcheer continuously builds and improves a comprehensive, tiered, and categorized
safety and health training system covering all employees. Through various formats
During the usage phase, Longcheer implements a dedicated personnel and specialized requisition system, providing professional training to relevant staff to
such as external training certifications, specialized topic training, thematic campaigns,
ensure standardized operations and controllable risks. Explosion-proof cabinets are set up in production workshops for the temporary storage of hazardous
and emergency drills, it continuously enhances employee safety literacy and risk
chemicals, with strict inventory control. All processes involving requisition, recovery, and disposal during use must be recorded in logs, forming a closed-loop
response capabilities, fostering a cultural atmosphere where "everyone prioritizes
management system to ensure clear and traceable chemical flow.
safety, everyone knows how to respond to emergencies—identifying hidden dangers in
To enhance emergency response capabilities, Longcheer has formulated the "Emergency Rescue Plan for Hazardous Chemical Accidents" and regularly their surroundings."
organizes chemical spill emergency drills. The spill handling procedures are clear with well-defined responsibilities, ensuring that situations can be controlled
In terms of professional qualification and skills training, each base systematically
quickly and effectively during emergencies, minimizing impacts on personnel and the environment. Additionally, Longcheer provides annual training for
organizes management personnel and employees in key positions to participate
chemical managers and users to enhance the safety awareness and emergency response capabilities of all employees.
in external certification training. In 2025, the Huizhou Base completed 122 external
Regarding the disposal of chemical waste, Longcheer's waste chemicals and their packaging containers are uniformly handed over to the Safety Assurance training sessions for first aiders, occupational health and safety managers, and
Section for processing, and are strictly registered in accordance with the "Hazardous Waste Management Log" to ensure compliant and environmentally sound dangerous goods handlers. The Nanchang Base trained a total of 37 safety officers,
waste disposal. Longcheer adheres to the principle of "recycling by type, strictly prohibiting mixed collection" to prevent cross-contamination and promote managers, and first aiders. The Vietnam Base conducted group safety training sessions
waste reduction and resource utilization. in accordance with local regulations and trained 14 first aiders.
Longcheer actively carries out routine safety-themed promotional activities to
Routine Safety Inspections strengthen employee health awareness. The company organized an "Occupational
Health Theme Month" activity, inviting professional medical staff to give lectures on
Longcheer has established and strictly implements a routine safety inspection mechanism covering all areas and multiple levels. Through an inspection occupational disease prevention and health knowledge. It also organized knowledge
system combining periodic, special, and pre-holiday checks, it systematically identifies safety hazards, promotes corrective action closure, and continuously competitions and safety skills contests, and conducted regular refresher training and
strengthens its workplace safety defense. assessments for first aid skills to ensure the continuous reinforcement of employee
emergency response knowledge.
Huizhou Base: In 2025, organized and conducted 86 various safety inspections, including 52 weekly inspections, 12 monthly inspections, 16 special
inspections, and 6 pre-holiday inspections. A total of 1,157 hazards were identified throughout the year, achieving 100% closed-loop management.
Nanchang Base: In 2025, implemented 65 safety inspections, including 42 weekly inspections, 12 monthly inspections, 5 special inspections, and 6 pre-
holiday inspections. A total of 676 hazards were identified and rectified, achieving 100% closed-loop management.
Vietnam Base: In 2025, conducted 45 safety inspections, including 25 weekly inspections, 12 monthly inspections, 3 special inspections, and 5 pre-holiday
inspections. A total of 267 hazards were identified throughout the year, achieving 100% closed-loop management.
Through this routine, comprehensive, and rigorously enforced safety inspection system, Longcheer continuously strengthens its risk prevention and control
capabilities, ensuring that operations at all bases consistently comply with safety regulations.
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Conducting Emergency Drills Supplier Safety Management
Longcheer systematically updates its emergency plans and conducts routine, scenario-based emergency drills of Longcheer integrates suppliers into its unified safety management system. Through institutional constraints,
various types. This continuously enhances the risk response capabilities of all employees and their proficiency in contractual agreements, training and education, and process supervision, it continuously strengthens the control
handling emergencies, solidifying the practical defense line for workplace safety and employee health and life. of risks associated with related-party operations, ensuring the effective fulfillment of safety responsibilities across
the entire chain.
In 2025, all of Longcheer's bases completed the preparation, update, and filing of their workplace accident
emergency plans. Focusing on various potential risk scenarios, they conducted multi-level, comprehensive In terms of system and agreement management, Longcheer formulates and implements normative documents
practical drills. Specialized drills were organized covering scenarios such as mechanical injury, falls from height, such as the Management System for High-Risk Construction Operations and the Engineering Construction
food poisoning, fire evacuation, chemical spills, lithium battery fires, elevator entrapment, forklift accidents, anti- Management System , which clearly define operating standards and responsibility interfaces. Each base signs
terrorism and riot control, electric shock, heatstroke, natural disasters, and infectious diseases, addressing various an annual Construction Safety Agreement with suppliers and implements the principle of "whoever hosts is
risks throughout all stages of the year. responsible" in accordance with the Personnel Access Management Regulations , strengthening access control and
process management for external personnel.
Regarding training and inspection mechanisms, Longcheer conducts specialized safety training for suppliers and
Emergency Drill for Machinery Injury Accident implements pre-entry safety assessments. For resident suppliers, each base regularly organizes monthly safety
inspections, hazardous operation permit approvals, and patrols during the construction process. For temporary
suppliers, it strictly implements full-process control including pre-entry training, agreement signing, process
supervision, and completion inspections.
In January 2025, the Nanchang Base organized and conducted an
emergency drill for a machinery injury accident. The drill simulated
an employee injuring their left hand while operating drilling
equipment. Colleagues on-site immediately stopped the machine
and called for help. The shift leader quickly assessed the injury
and alerted the emergency services. The response process was
efficient and rapid, with all teams cooperating seamlessly. This drill
effectively verified the feasibility of the emergency plan and the
employees' emergency response capabilities.
Through continuous, diverse, and realistic emergency drills, the company has effectively verified the feasibility of
its emergency plans and the responsiveness of its teams. This has enhanced employees' awareness of self-rescue
and mutual aid, as well as their emergency handling skills, laying the foundation for establishing an emergency
mechanism that integrates "routine preparedness with emergency response, enables rapid reaction, and ensures
effective handling."
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Impact, Risk, and Opportunity Management Metric and Target
Longcheer has established a systematic mechanism for managing health and safety impacts, risks, and Longcheer formulates and continuously optimizes the Environmental, Occupational Health and Safety, and CSR
opportunities. Annually, it organizes various departments to systematically identify, assess, and respond to risks Objectives, Targets, and Management Programs , clearly defining annual key safety indicators. Guided by these
and opportunities, ensuring through structured processes that risks are identified, evaluated, and addressed objectives, it continuously improves health and safety performance during operations, creating a safe, healthy,
early. and sustainable working environment for employees.
Through the Employee Emergency Rescue Management System and the Incident Investigation Management
Specifications , Longcheer defines the comprehensive requirements for managing related risks across the entire Our Targets Our Progress
process—from incident prevention, reporting, and emergency rescue to cause investigation, rectification,
and closure. This ensures timely and effective emergency responses and thorough post-event analysis and
improvement. Major safety incidents: In 2025, the company had major safety accidents
Furthermore, Longcheer has established smooth channels for risk reporting and complaint feedback. The Safety
Audit Management System clarifies that employees can report issues through safety managers in their respective
Occupational disease cases:
occupational diseases
departments or directly to the safety department. This ensures that employees' concerns regarding health, safety,
Chemical leakage incidents:
and the working environment are communicated promptly and incorporated into the company's routine risk
management and continuous improvement system, fostering a safety culture characterized by full employee
In 2025, the company had
participation and closed-loop governance.
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Empowering Employee Development
The company consistently regards talent as the core driver of enterprise growth. By systematically building a comprehensive human resource management system that covers talent acquisition, career development, training &
empowerment, and compensation incentives, we are committed to creating a fair, open, and sustainable talent ecosystem. This system continuously stimulates organizational vitality and supports the achievement of corporate strategic
goals and long-term development.
Strengthening Talent Acquisition
Enhancing Talent Planning Expanding Recruiting Channels In addition, the company has partnered with the
Employment Promotion Center of Xuhui District,
To continuously align with the company's business Beyond conventional recruitment platforms and Shanghai to establish an employment internship
strateg y and future development needs, we executive search firms, Longcheer actively expands base, set up training bases in Nanchang and
have established a systematic and for ward- diversified talent acquisition channels, including Luoyang, and jointly built a Longcheer sector training
looking talent acquisition and reserve system. By government-enterprise collaboration and university- base with universities in Nanchang, gradually
integrating industry insights, business forecasts, and enterprise partnerships. establishing a systematic, multi-tiered talent reserve
organizational analysis, we scientifically plan our and cultivation system.
talent layout to support sustainable organizational Through collaborating with multiple universities to Shanghai Longcheer Scholarship Award Ceremony
growth. build training bases, we continuously promote the
deep integration of industry and education, share
The company regularly conducts industry trend teaching resources, and co-develop specialized
research, systematically collecting and analyzing programs, alongside establishing special corporate
industry reports, policy developments, and market scholarship programs. In 2025, Longcheer continued
information to continuously track technological its scholarship programs with six universities,
evolution and job market changes within the including Zhejiang University and Nanchang
consumer electronics sector. Meanwhile, based on University, while adding five new higher education
Nanchang Longcheer University-Enterprise Longcheer Huizhou Collaboration Event with
strategic planning and business growth targets, we institutions such as Shenzhen University and Hefei
Cooperation Plaque Unveiling Ceremony a Technical School
forecast future talent demand using historical data University of Technology, to encourage outstanding
and in-depth analysis of key employee turnover students to enhance their professional capabilities To support global business expansion, the company's recruitment team has actively advanced the development of
factors, proactively arranging supplementary and academic standards. localized recruitment channels overseas. By leveraging international job platforms such as LinkedIn and Jobstreet
recruitment to ensure a continuous and stable for talent sourcing, and participating in overseas university career programs, we ensure timely talent supply and
supply of talent. pipeline across all regions.
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Employee Career Development To promote fairness and transparency in development paths, Longcheer has formulated and implemented the
Person-Post Matching Management System , establishing a dynamic job level review mechanism centered on
responsibility and contribution. The company implements a qualification system where employees can apply for
Broadening Development Paths
certification from Level 1 to Level 6 based on their personal development plans, with assessments conducted by
the Expert Committee through evaluation or defense. Each level corresponds to clear role positioning, capability
requirements, and contribution standards, forming a progressive development ladder from basic execution to
Longcheer is committed to building a systematic, multi-channel career development system for its employees. strategic leadership.
By establishing a "dual-track development path" that runs parallel management and professional sequences, it
provides clear growth directions and diverse development spaces for employees with different characteristics and In 2025, Longcheer systematically optimized its promotion policies by releasing the 2025 Annual Work
aspirations. Arrangement for Person-Post Matching Review , further clarifying the promotion conditions, standards, and
review processes for management, professional technical, and support positions. The new policy strengthens
Longcheer has established a three-level job classification standard based on "family, category, and sub-category," the connection between the qualification system and business strategy, promoting a promotion mechanism
systematically planning both the management channel and the professional technical channel. After joining, that is more contribution-oriented, procedurally standardized, and continuously iterative, providing institutional
employees can gradually grow into business backbone within the professional channel, and then continue guarantees and development momentum for employee career growth.
to advance towards becoming domain experts or professional development experts. For employees who
demonstrate management potential, Longcheer appoints them to management positions through a selection 2025 marks the second year of the official implementation of Longcheer's qualification management system.
mechanism. With specialized support such as new cadre training programs and cadre culture seminars, it helps All core construction indicators have comprehensively exceeded expected targets, achieving a significant
them successfully transition from independent contributors to qualified team managers. improvement in system maturity:
Cadre Standards Qualification Standard
s Standard Development Rate: For 160 key positions with 10 or more incumbents, Longcheer systematically
Senio in developed and published 153 qualification standards. Standards for 6 newly added positions in the
Execu r Doma nt Marketing Academy
tive pme
Top Executive Exchange Forum
s
Develo rt manufacturing cluster's automation equipment category and the Structural R&D - Structural PM position are
Key Position Talent Development Expe Quality Academy
Middle Software Academy currently in progress. Ultimately, a 96% standard development rate was achieved, significantly exceeding the
and Se rt
nio Expe
Middle and Senior Cadre Seminar
Cadre r
Hardware Academy initial target of 90% set at the beginning of the year.
Face-to-Face with New Director s
Structural Engineering Academy
Middle
an
Grassro d taff /
ots Core S ne
Cadre Empowerment Testing Academy
President's Office Meeting
Cadres Backb
o
Operations Academy Certification coverage: Based on 5,666 professional technical and middle-level grassroots cadres on duty at
Procurement Academy the beginning of 2025, certification applications increased from 1,198 person-times in 2024 to 2,436 person-
Indepe
nden ndent
Executo t Indepe r
Manufacturing Academy
Executo
r
times in 2025, totaling 3,634 person-times over the two-year period, with a certification coverage rate of 64%,
New Manager Training Camp
Process & IT Academy
exceeding the annual target of 50%.
Youth Training Class Finance Academy
Executo
rU r Under
Superv nder Executo ion Certification Quality: In 2025, the certification pass rate remained high at 93%, with an overall cumulative
ision is
Superv
pass rate of 79%, fully demonstrating the scientific and efficient nature of the certification process.
Longcheer's Dual Career Development Path
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The company will continuously optimize the qualification certification mechanism and further refine the career
Employee Training and Empowerment
Training System Construction
development system while maintaining high coverage.
Standard Development Rate Certification Coverage Rate
systematic, multi-level training system. Through Longcheer Academy and its subordinate professional academies—
including Software, Hardware, Operations, Manufacturing, Quality, and Finance Academies—it systematically
conducts new employee integration, cadre capability advancement, and professional talent development
Job Qualification Standard Development Rate Qualification certification coverage rate： programs. These initiatives pass on the corporate culture and core values, forge key capabilities that match business
Total number of positions: 193 Scope: Technical professionals + Middle and Junior- development needs, and continuously cultivate and supply talent for the company's main business channels.
Positions with 10 or more incumbents: 160 level managers
Developed job qualification standards: 153 Number of employees on board at the beginning of
Operating around the training system, Longcheer has established a management mechanism supported by three
core systems:
PM：Under development: 6 new positions in 2025: 5,666
manufacturing automation equipment, Structural R&D - Number of applicants for certification in 2024: 1,198 Targeting the differentiated characteristics of social recruits and campus recruits, this policy defines a
New Employee
Structural PM Number of applicants for certification in 2025: 2,436 systematic onboarding process covering aspects such as system orientation, cultural integration, job
Onboarding
Guidance Policy
and growth.
Promoting Internal Mobility
This policy establishes a tiered learning system covering senior, middle-senior, and middle-grassroots
Cadre Learning
level cadres. It implements the principles of "self-development, development through practice,
and Development
combining training with practice, and promoting learning through assessment," and makes learning
Guidance Policy
outcomes a necessary condition for cadre promotion and incentives.
Longcheer continuously broadens employee growth paths and stimulates overall organizational vitality by building
a systematic talent development mechanism and an institutionalized internal mobility platform. The company Professional
This policy standardizes the establishment, organization, operation, and assessment mechanisms
encourages employees to actively participate in cross-departmental projects and job rotations, accumulating Academy Operation
of various professional academies, ensuring the continuous development of learning resources in
composite experience and enhancing comprehensive capabilities through a "training and practice integrated" model. and Management
professional fields and the quality of training implementation.
To promote talent information transparency and mobility autonomy, Longcheer regularly publishes job vacancy Guidance Policy
information through internal recruitment platforms, emails, and other channels, supporting eligible employees to
apply independently and facilitating the orderly flow of talent within the organization. In terms of supporting mechanisms, Longcheer has formulated a series of standardized processes, including the
Training Operation Management Process, Internal Trainer Management Process , and Business Mentor Management
Since 2023, Longcheer has officially implemented the "Fresh Water Program," establishing a systematic internal Process , ensuring the orderly operation of all aspects of training.
transfer mechanism. This program aims to guide employees to prioritize internal opportunities when considering
career changes, promoting optimal allocation of human resources and expanding employee development space. In 2025, Longcheer's learning platform continuously enriched its course resources, with 1,087 new courses released
The process encompasses job posting, employee application, coordination and evaluation between the original throughout the year, bringing the total number of courses on the platform to 3,884. The content covers multiple
department and target department, cross-departmental interviews, and tripartite approval, ensuring a fair, categories including corporate culture, management, research and development, general skills, and processes
standardized, and transparent mobility process. In 2025, Longcheer successfully achieved internal transfers for and systems. Employee learning activity steadily improved, with an average weekly learning duration reaching 120
positions, and enhancing organizational vitality and employee retention rates. continuous improvement.
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Targeted and Precision Empowerment Soil Tilling Seedling Cultivation Germination
Longcheer has established a systematic training plan with layered classification and precision empowerment,
designing differentiated development paths for different employee groups to support the continuous Theoretical learning, Cultural workshop, Production line practice,
improvement of talent capabilities and the effective implementation of organizational strategy. getting a head start values alignment understanding the business
① Professional knowledge ① Case study discussion ① On-the-job training (to acquire
New Employee Development
② General competencies ② Military training operational capabilities)
③ Cultural atmosphere ③ Business and product knowledge learning ② Production line hands-on practice (enter
the production line with assigned topics
to understand the relationship between
R&D and manufacturing)
③ Engineering empowerment (to
understand business logic)
For socially recruited new employees, Longcheer implements an "Integration Plan," covering aspects such as
onboarding policy orientation, online compulsory course learning and assessment (including 8 courses covering
CSR, Quality, Safety, etc.), and offline centralized cultural seminars. Each new hire is also assigned a business Becoming a Talent Standing Out Seedling Emergence
mentor who provides guidance throughout the probation period, helping them quickly adapt to their roles.
For campus-recruited graduates, Longcheer conducts a systematic three-year development program called
On-the-job learning,
the "Little Sun Plan." The "Little Sun Plan" integrates job experience, project practice, specialized training, and Deepening professional expertise, Project practice,
probation assessment and
project management advanced training
mentor guidance to systematically enhance the comprehensive quality and professional capabilities of the new regularization
generation of employees. This continuously supplies Longcheer with backbone talents who identify with the ① Deepening professional expertise ① Project practice (gain opportunities to ① Mentorship (develop a mentoring plan)
(participate in projects to accumulate participate in key projects) ② Intensive training (concentrate the
corporate culture, are competent in their positions, and are future-oriented. professional problem-solving ② Advanced courses (concentrate the company's best resources to centrally
capabilities) company's best resources for advanced train colleagues in the same field)
② Technical seminar (participate in training) ③ Regularization defense (to verify if the job
learning and exchanges at professional ③ Participate in promotion defense and requirements are met)
academies to broaden knowledge) complete promotion
③ Project management capability training
④ Strive for promotion
Core Backbone
Taking on heavy responsibilities,
mentoring others
① Undertake challenging tasks and mentor others
② Promotion planning, assuming management responsibilities
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On-the-Job Employee Development Specialized Development for Front-Line Managers at Manufacturing Bases
Longcheer has established a front-line manager development system at its manufacturing bases, covering positions such as multi-skilled workers, team leaders, and production
Longcheer has built a tiered cadre learning system
supervisors. This system is divided into two categories: promotion training and empowerment training.
covering senior, middle-senior, and middle-
grassroots levels. Through formats such as cultural Promotion Training Empowerment Training Reserve and Promotion Mechanism
seminars, management practice sessions, and policy
Reserve training camps for multi-skilled workers, team Specialized training sessions are conducted on topics Through 5 sessions of reserve team leader training,
interpretations, it continuously enhances the cadre
leaders, and production supervisors are conducted such as management communication and professional the Huizhou Base has cumulatively cultivated
team's capabilities in strategic understanding, team
quarterly. Through a combination of "theoretical skills. In 2025, the Huizhou Base organized a total of 228 qualified reserve talents, with 97 employees
management, and performance achievement.
instruction + return-to-post practice," the company 8 special training sessions, covering 316 people, with promoted internally, achieving an internal promotion
Each professional academy organizes an average systematically cultivates reserve talent. The Nanchang a qualified assessment rate of 88.6%. Concurrently, rate of 42%. By optimizing selection criteria, the
of no fewer than 3 specialized training sessions per Base has completed multiple sessions, successfully 13 courses were developed and iterated upon, proportion of team leaders with high school
month centered around the qualification system, cultivating a total of 73 qualified reserve multi-skilled establishing a closed-loop training mechanism of education or above increased from 54% to 73% in
continuously updating and delivering course resources workers, 85 reserve team leaders, and 63 reserve "inventory—training—assessment—empowerment." 2025, achieving continuous optimization of the front-
in key areas such as research and development, production supervisors. Additionally, the base organized outdoor team building line management team with improvements in both
manufacturing, and quality, supporting the iterative activities for team leaders, with a participation rate of "quantity and quality."
improvement of employees' professional capabilities. 98% and a satisfaction score of 4.67.
Global Talent Development
Cross-Cultural Language Empowerment Program at Vietnam Manufacturing Base
To support the implementation of Longcheer's
globalization strategy and deepen the localized Starting in October 2025, Longcheer launched the "Sino-Vietnamese Language and Cultural
operations and cross -cultural collaboration Integration Empowerment Program" at its Vietnam manufacturing base. The program provides
effectiveness of its overseas manufacturing bases, Vietnamese language instruction for Chinese employees and Chinese language training for
the company systematically carries out targeted Vietnamese key personnel. Taught by internal instructors with bilingual capabilities, the
training programs. It focuses on building a global curriculum is developed based on real-world scenarios such as production meetings and quality
talent empowerment system integrating "language reviews, strengthening practical application through small class instruction and situational
proficiency, cultural understanding, and management simulations. The courses also integrate cultural knowledge and business etiquette, with regular
collaboration," continuously providing solid talent exchange salons organized to promote understanding and mutual trust. Since the program's
support for the in-depth advancement of the implementation, employee efficiency in daily communication, production coordination, and
company's internationalization strategy. cross-language meetings has significantly improved.
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Employee Compensation and Incentives Strengthening Performance Incentives
Fair Compensation Management
Adhering to the core value of "contributor-oriented," Longcheer has built a full-cycle, multi-level performance
management system. Through a closed-loop mechanism encompassing goal setting, process tracking, evaluation
feedback, and results application, it continuously stimulates organizational and employee vitality, driving the effective
In its compensation management, Longcheer consistently upholds the core value of "contributor-oriented" and
implementation of strategic objectives.
adheres to the compensation philosophy based on responsibility and contribution. The compensation system is
fundamentally based on job responsibilities, performance contributions, and sustained contribution capabilities. The company establishes differentiated evaluation cycles based on job characteristics, including quarterly, semi-
Compensation is dynamically reviewed and reasonably adjusted according to employees' position changes, grade annual, and annual assessments, and has established a diversified incentive system that closely links performance
adjustments, and actual contributions, continuously motivating employees to create greater value. results with rewards:
Longcheer's compensation structure is built upon a scientifically formulated salary framework. This framework is
Annual Performance Bonus: Distributed based on organizational value contribution and individual performance, with preference
designed by the HR system based on the company's strategy, talent strategy, and external market compensation
given to high performers.
levels, and is reviewed and optimized annually. Both initial salary determination and salary adjustments are strictly
implemented in accordance with this salary framework, ensuring standardized and systematic management. Project Bonus: Provides timely incentives to project teams during implementation, holding them accountable for business results
and capability building.
Sales Breakthrough Award: Incentivizes breakthroughs from 0 to 1 in new customers and new product categories.
High-Performance Total Reward Differentiated Dynamic Review Monthly/Quarterly Performance Award: Applicable to operational positions in manufacturing and non-operational positions
Orientation Perspective Management respectively, achieving short-term timely incentives.
Based on the responsibilities Rewards are based on the total Differentiated management is Taking responsibility and Medium to Long-Term Incentives: Through equity incentive plans, promotes joint growth of middle and senior-level cadres and
undertaken by employees and reward perspective, which adopted for position changes contribution as the value driver, core backbone employees alongside the company.
their continuous contributions includes salaries, bonuses, of different natures and the employee's rewards are
in their respective positions, equity incentives, and special employee groups with different dynamically reviewed based
Performance evaluation follows seven key stages: "Goal Setting, Process Coaching, Performance Evaluation, Result
reasonable rewards are welfare subsidies related to contribution characteristics in on position changes and job
Announcement, Communication Feedback, Improvement Enhancement, and Performance Appeal," achieving process-
provided. position responsibilities. their positions. competence, with adjustments
oriented and transparent management. In 2025, Longcheer conducted comprehensive performance evaluations for 6,953
made accordingly (rewards can
office employees, ensuring full participation and complete coverage.
be increased or decreased).
To promote performance communication and continuous improvement, the company has established a feedback
Longcheer Compensation Management Principles mechanism primarily based on one-on-one interviews, along with multiple feedback channels. For suggestions raised by
employees, Longcheer systematically reviews and drives corrective actions, forming a closed loop.
Our Target Our Progress In 2025, Longcheer collected 571 employee suggestions through special surveys. Focusing on key issues such as goal clarity,
process fairness, and coaching support, the company promoted a series of optimization initiatives including establishing a
Prohibit paying employees below the local minimum In 2025, 100% compliance achieved for all
quantitative indicator library, conducting manager empowerment training, and improving calibration mechanisms. These
wage standard employees' wages
efforts continuously advance the performance management system towards an "empowering and developmental" model.
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Corporate Caring and Benefit
Longcheer consistently prioritizes employee well-being as a cornerstone of corporate development. By systematically establishing a comprehensive benefits and activities system that covers security support, health management, diverse
care initiatives, and assistance for those in need, we are committed to fostering a balanced, warm, and vibrant working environment, continuously enhancing employees' sense of belonging and organizational cohesion.
Improving Employee Basic Security and Work Support
Benefits The company legally contributes to employees' endowment, medical, unemployment, work-related injury, and maternity insurance programs, as well as the housing
provident fund.
The company implements the various leave systems stipulated by the state, providing eligible employees with maternity leave, parenting leave, and lactation leave in
Building Benefits System accordance with relevant national and local regulations.
Transportation, meal, and business travel allowances are provided according to job nature and local policies. The company also assists eligible personnel in applying
for talent apartments and other housing support to effectively alleviate living pressures.
On the basis of complying with national laws and
regulations, the company continuously improves Multi-layered Health Security System
its management systems and benefits structure by
integrating company realities with employee needs, The company provides pre-employment physical examinations for new hires and annual health checks for all employees.
striving to provide comprehensive, multi-layered A commercial insurance system has been established, covering supplementary medical insurance, accident insurance, overseas business travel insurance, and
protection and support for employees' career overseas dispatch insurance, building multiple layers of health and safety protection for employees.
development and work-life balance. Regular health seminars and traditional Chinese medicine consultations are organized to further help employees establish health awareness and master the
knowledge and methods for maintaining physical and mental well-being.
Diverse Care Initiatives and Facility Support
Sports facilities such as basketball courts, badminton courts, and table tennis tables are available on-site, along with employee lounges and pantries to meet the
needs for leisure and rest.
An Employee Shared Service Center and an Employee Joint Mediation Center have been established within the park to provide one-stop support for personnel
matters, attendance, accommodation, and logistics.
The residential area is equipped with comprehensive life service facilities covering laundries, clinics, barbershops, electric vehicle charging sheds, maternity rooms,
supermarkets, and food courts, significantly enhancing the convenience of working and living on-site.
The company continuously optimizes annual festival gifts and has introduced new activities such as "Corporate Family Day" to constantly strengthen employees'
sense of belonging and happiness.
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Assistance for Employees in Need
Diverse Facilities
The company consistently upholds the philosophy of humanistic care, actively establishing and implementing a
support mechanism for employees in difficulty, providing timely and effective assistance through institutionalized
and regular care initiatives.
To systematically support employees and their families facing financial hardship due to serious illness or sudden
accidents, the company has specifically established the "Longcheer Cares Fund". This fund is available to
employees of Longcheer Group and their spouses and children, providing emergency financial aid to families
facing economic distress due to conditions such as malignant tumors, severe accidents, or sudden critical
situations. In 2025, the company completed one application and disbursement under this fund, effectively
alleviating the temporary difficulties faced by an employee's family.
Outdoor Basketball Court Indoor Basketball Court
Fitness Equipment Clinic
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Care & Benefits Activities
Enriching Staff Life We continuously organize employee birthday parties, festival-themed care initiatives, and daily heartwarming
local activities, committed to deepening the emotional connection between the company and employees, and
The company always pays close attention to the balance between work and life, committed to building an enhancing their sense of belonging and organizational identification. At Longcheer, every important moment
organizational atmosphere that is vibrant, warm, and cohesive. We systematically plan and continuously carry out is imbued with a sense of ceremony. The company injects fun and warmth into the workplace through the
diversified employee activities, primarily categorized into the following three types: organic integration of culture and festivals, conveying happiness and positive energy, and creating beautiful and
memorable collective memories for our employees.
Business Operations Activities
Care & Benefits Activities
Longcheer regularly organizes meetings with the President's Office, executive cultural co-creation seminars,
strategic promotional meetings, and company-level honor selection events. These activities aim to align
strategic understanding across the organization, deepen cultural identity, and stimulate organizational vitality.
By facilitating high-level interactions to ensure effective strategic penetration and relying on the honor system
to drive performance improvement, we ultimately form a unified operational synergy to strongly support the
achievement of the company's strategic goals.
Business Operations Activities
Mid-Autumn Themed Birthday Party Quarterly Birthday Party (Hefei) 1024 Offline Challenge Event (Shanghai)
(Huizhou)
Christmas Event (Nanchang) International Women's Day Health New Year Studio Photoshoot (Shanghai)
Seminar (Nanchang)
Executive Face-to-Face Session (Shenzhen) Company-wide Commendation Conference (Shanghai) Family Day at Longcheer (Nanchang) First-Prize Winning Entry: Children's
Painting Contest (Online Event)
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Cultural & Sports Activities
To enrich employees' spared lives, the company has established 28 employee interest associations across its six bases, covering football, basketball, badminton, table tennis, yoga, photography, and more, providing special funding
support to encourage independent activity organization. Every year, these associations and employees spontaneously organize a variety of sports events, including basketball leagues, badminton tournaments, and city health challenges.
These exciting activities not only promote communication and interaction among employees but also help cultivate healthy hobbies and expand interpersonal networks, continuously enhancing team cohesion and organizational vitality.
Cultural & Sports Activities
Badminton Team Championship (Hefei) Table Tennis Tournament (Shanghai) Photography Competition (Huizhou) K-Olympian Singing Contest (Huizhou)
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Advancing Responsible Sourcing
Strengthening Supply Chain Establishing regular communication and
Strategically planning, reser ving, and
Resilience Managing
the Supplier updating potential and existing supplier Managing
Supplier
cooperation mechanisms to promote
information sharing, collaborative problem-
Resource resources to provide strategic support for Relationships solving, and relationship deepening, building
Pool supply chain layout.
To build a robust and sustainable supply chain system, Longcheer has long-term, mutually beneficial partnerships.
established a systematic management mechanism that covers the entire
lifecycle of suppliers. By optimizing process systems, strengthening audits and
quality control, and systematically implementing risk prevention and control,
the company is committed to continuously enhancing the overall resilience,
responsibility, and collaborative efficiency of the supply chain, providing a solid
foundation for sustainable business development. Ensuring that new suppliers meet the Conducting regular evaluations based on
Managing company's requirements regarding quality, Managing Key Performance Indicators (KPIs) to drive
Supplier compliance, and social responsibility Supplier continuous improvement from suppliers in
End-to-End Supplier Management
Certification through standardized audits and multi- Performance areas such as quality, delivery, service, cost,
dimensional evaluations. and sustainable development.
Improving Management Processes
We have built a systematic, full-cycle supplier management system. This system
forms a complete closed loop, covering everything from resource onboarding
and certification assessments to performance tracking and relationship Collaborating with R&D and procurement
Developing and executing standardized
offboarding, aiming to achieve continuous supply chain optimization and stable Managing to promote the scientific nature and
Managing supplier exit mechanisms to ensure a
operations. This system revolves around six core processes: Material consistency of material selection based
Supplier Exit smooth business transition and controllable
Selection on criteria such as technology, cost, and
supply chain risks.
sustainability.
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Strengthening Supplier Audits Enhancing Supplier Quality
Longcheer has established a routine, standardized audit mechanism covering both new and existing Longcheer has established a systematic, end-to-end supplier quality management system. Centered on the core principles
suppliers, systematically ensuring supply chain compliance and stability, and continuously improving of "meeting customer standards, ensuring material quality, and guaranteeing supply stability," we continuously drive
overall supply quality and responsibility performance. supplier capability improvement and closed-loop quality management.
For new supplier onboarding audits, we strictly follow the Supplier Certification Management At the organizational and process level, the company empowers supplier quality system construction through specialized
process. Using category-specific checklists, we conduct multi-dimensional assessments, including control mechanisms. We continuously optimize our internal organizational structure, process standards, and personnel
the Fabrication/Mechatronic Parts Supplier Quality Process Audit Checklist , Quality System Audit capabilities to build a highly efficient, collaborative quality management team, providing customers with stable and reliable
Checklist , Hazardous Substance Process Management Checklist , and Corporate Social Responsibility product and service support.
Checklist , to comprehensively review supplier capabilities.
Project The Supplier Quality Management (SQM) team intervenes to sort out requirements, identify
In 2025, the company completed audits of new suppliers in Pass rate of rectification Initiation risks, and formulate plans. An Initiation Meeting Report is generated to promote internal
the structural and electromechanical categories, totaling items Phase collaboration.
The Supplier Quality Management responsible person and Procurement Technology
Certification Engineer monitor supplier execution and track the completion status of
development
deliverables based on quality planning requirements. This includes key quality control points
and validation
For existing suppliers, the company conducts annual surveillance audits using standardized such as phase-in yield, process documentation, and reliability testing. They also conduct phase
phase
inspection tools aligned with new product audits, covering quality systems, process control, reviews and implement closed-loop management for high-risk materials.
hazardous substance management, and social responsibility, in accordance with the Supplier
Audit Management Procedure. This ensures consistency, comprehensiveness, and continuity of the
Mass
evaluation system. The company continuously monitors supplier mass production yields and tracks the analysis
Production
and improvement of EWP material issues, establishing a closed-loop mechanism for problem
Ramp-up
identification, rectification, and verification.
Phase
In 2025, the company completed audits of cooperative suppliers Pass rate of rectification
in the structural and electromechanical categories, totaling items
The execution of quality management activities across all stages is systematically reviewed.
Stable
Shortcomings in the project process are deeply examined and analyzed for root causes. Finally,
Production
a Project Summary Meeting Report is generated to institutionalize quality management
Phase
experience and continuously optimize processes.
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Mitigating Supply Chain Risks
Risk Control Process Logistics Risk Management
The company has established a forward-looking, systematic risk control mechanism to identify, assess, and To address various uncertainties in logistics and transportation, the company has established a systematic
respond to risks throughout the entire process of supplier onboarding, procurement execution, and incident transportation safety management mechanism. By combining institutional standards, process monitoring, and
management. Through a full-chain risk control system that spans pre-event, in-process, and post-event stages, risk contingency plans, we comprehensively enhance the stability and risk resistance of supply chain logistics.
we continuously enhance the transparency, controllability, and resilience of the supply chain, providing a solid
guarantee for business continuity and sustainability. Guided by the Management of Transportation Execution framework, the company formulates and publishes
the Transportation Safety Control Specification , implementing standardized control over the entire transportation
We establish strict onboarding standards, treating operational risk as one of the key audit dimensions. Suppliers chain. This specification covers all links from loading and departure, in-transit transportation, to final delivery.
assessed as Grade F in financial risk are subject to a "one-vote veto" and are not permitted to join, thereby It explicitly requires real-time GPS monitoring throughout the entire journey and photo documentation before
controlling cooperation risks at the source. and after delivery, ensuring goods status is traceable and handover processes are compliant and controllable,
effectively preventing goods delivery risks.
Longcheer utilizes a risk quantification assessment model to systematically identify potential risks during business
execution. This model covers the failure impacts that risk events may cause, risk level ratings, and is accompanied The company continuously builds a localized procurement network to reduce geopolitical risks and enhance
by corresponding risk response strategies and improvement contingency plans, ensuring risks are foreseeable, supply chain resilience. During the reporting period, the localization rate of procurement at the Vietnam factory
controllable, and manageable. increased to 60%.
Furthermore, the company formulates and implements the Management of Unexpected Emergencies Process , In response to external risks such as extreme weather and geopolitical issues, Longcheer continuously improves
establishing a standardized response mechanism for potential emergencies in the supply chain. This includes its emergency plans and early warning response mechanisms. By dynamically assessing the transportation
rapid risk identification, emergency plan activation, collaborative handling, and post-event review and environment, optimizing route planning, and strengthening carrier collaboration, we enhance our ability to
improvement, enhancing the organization's resilience and recovery capabilities in uncertain environments. respond to emergencies, ensuring the safety and timeliness of logistics channels and supporting the overall stable
operation of the our supply chain.
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Advancing Responsible Governance Strategy
Procurement
Risk and Opportunity Identification
To systematically build a sustainable and responsible end-to-end Longcheer has established a clear supplier CSR management governance The company continuously conducts risk and opportunity identification
management system, the company has incorporated supplier CSR structure. The procurement system is fully responsible for social regarding supplier CSR management. By building a forward-looking
management into its strategic governance framework. By clarifying responsibility compliance and performance management throughout management framework, we solidify the baseline of responsibility
responsibilities, conducting risk and opportunity identification, the supplier process, while the Quality Department assists in supplier through risk prevention and control, while enhancing the long-term value
promoting code of conduct compliance and capability building, and capability building and accountability empowerment. This forms a of the supply chain by seizing opportunities.
establishing routine communication, feedback, and performance responsibility implementation mechanism with clear authority and
evaluation mechanisms, we continuously drive collaborative coordinated collaboration.
improvements in environmental, social, and governance (ESG)
performance across the supply chain.
Longcheer Responsible Procurement Risk and Opportunity Analysis
Category Description Impact Cycle Impact Level Potential Financial Impact Actions
N o n - co m p l i a n ce b y s u p p l i e r s i n a rea s s u c h a s By establishing a supplier audit and responsibility agreement system
environmental protection and labor rights may Short-erm Decrease in Operating Revenue that covers the entire lifecycle, incorporating CSR compliance into the
High
trigger supply chain disruptions and damage to brand Medium-term Reduction in Net Profit admission criteria and performance red lines, and implementing a
Risk reputation. tiered reporting mechanism to promptly manage abnormalities.
Some suppliers lack CSR management capabilities and Conduct regular CSR-specific training and capability building covering
may be unable to adapt to increasingly stringent policies Medium-term Medium Rising procurement costs environmental protection, labor practices, and business ethics to
and customer requirements. enhance suppliers' overall responsibility performance.
Promoting green and compliant supply chains helps Incorporating green procurement and conflict minerals management
Medium-term
Opportunity gain greater recognition from international customers High Revenue growth into the Supplier Code of Conduct and performance evaluations
Long-term
and the capital market. enhances supply chain credibility and market competitiveness.
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Risk and Opportunity Response
Establishment of a Code of Conduct Strict Supplier Onboarding Management
The company formulates and publicly releases a T h e co m pa n y st r i ct l y i m p l e m e n ts s u p p l i e r
Supplier Code of Conduct , clearly defining standards onboarding and dynamic performance management,
and requirements regarding labor rights, health and incorporating corporate social responsibility In November 2025, Longcheer held an environmental protection themed training conference for all suppliers.
safety, environmental protection, business ethics, (CSR) compliance requirements into the supplier The training systematically interpreted domestic and international environmental regulations, conducted an in-
and supply chain social responsibility management. performance evaluation system. If a supplier violates depth analysis of typical penalty cases from the European Union, and clarified Longcheer's own environmental
By establishing non-negotiable red-line provisions, it CSR regulations, its performance rating will be management requirements. By combining industry best practices with on-site assessments, the event effectively
provides suppliers with clear action guidelines and a directly downgraded to Level D and placed on a enhanced suppliers' awareness of environmental compliance and their ability to fulfill responsibilities. The
compliance basis for fulfilling their responsibilities. blacklist. This measure strengthens the ethical and activity covered 337 supplier partners, further promoting the overall improvement of environmental management
compliance baseline of the supply chain, ensuring standards across the supply chain and strengthening the collaborative development of a green supply chain.
partner alignment with the company's responsibility
principles.
Enhanced Supplier Training
Longcheer continuously empowers its partners through systematic and specialized CSR training programs,
promoting a deeper understanding and improved practices in the fields of social responsibility and sustainable
development.
Impact, Risk and Opportunity Management
Longcheer is committed to building a transparent and responsible supply chain management system. We require suppliers to proactively report any CSR/ESG management abnormalities. Concurrently, our internal SQM and resource
development teams are responsible for the initial verification. To ensure the authority and effectiveness of risk management, Longcheer has implemented a tiered decision-making mechanism based on risk levels: significant ESG matters
that exceed routine authority are escalated level by level along the established escalation management channel until the issue is closed. This approach ensures that sustainability risks within the supply chain remain under the strict
monitoring of the organization and the supervision of top management.
Simultaneously, the company places great importance on two-way interaction and oversight with stakeholders, striving to build an open and transparent communication feedback mechanism. We encourage internal employees,
suppliers, and other external stakeholders to submit inquiries, report issues, or express concerns regarding supply chain responsibility through official channels. The company initiates a dedicated investigation and response process for
all good-faith feedback, ensuring every comment is taken seriously and handled to closure. Together, we aim to continuously optimize supply chain responsibility governance.
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Metrics and Targets Conflict Minerals Management
Centered on supply chain sustainability and responsibility governance, the company has established a systematic
Key Performance Indicator (KPI) framework. Spanning multi-dimensional objectives—including supplier Longcheer is firmly committed to promoting responsible supply chain management. We strictly adhere to
onboarding, compliance management, responsibility capability building, and internal collaboration—this system international standards such as the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from
drives the continuous deepening of supply chain responsibility management. Conflict-Affected and High-Risk Areas , the Responsible Minerals Initiative (RMI), and the Responsible Business
Alliance (RBA) Code of Conduct, as well as local laws and regulations. We pledge not to support or use minerals
illegally mined in conflict-affected and high-risk areas, and to eliminate the direct or indirect financing of conflict,
Targets Our Progress
while actively supporting the relevant initiatives of the RBA and the Global e-Sustainability Initiative (GeSI)
regarding conflict minerals governance.
Social Responsibility Agreement . Supplier Corporate Social Responsibility systematically building a supplier management system that requires all partner manufacturers to sign a Letter of
Agreement . Commitment on Non-Use of Conflict Minerals , thereby driving the entire supply chain to meet the requirements of
and Clean Business Cooperation Agreement In 2025, 100% of suppliers signed the
Integrity Cooperation Agreement in 2025 In 2025, the company conducted a specialized due diligence investigation on 550 direct suppliers, requiring them
key raw material suppliers In 2025, 100% of Key Raw Material Suppliers systematically aggregating and analyzing smelter information within the supply chain and comparing it against
Audited for Social Responsibility in 2025 the RMI's published compliant origin database, the company achieved traceability and verifiability of mineral
Number of sustainable procurement-related sources. The annual survey results showed that the raw materials used in the company's supply chain do not
training sessions for core suppliers ≥ 1 time/year In 2025, 1
sustainable procurement-related involve conflict minerals.
training session was conducted for core
Sustainability procurement training frequency suppliers.
(internal procurement staff): ≥ 1 session/year In 2025, 1
training session on sustainable
procurement topics was conducted for internal
Targets Our Progress
procurement and related personnel.
Maintain a 100% compliance rate for 100% survey coverage for conflict minerals
conflict minerals due diligence among Tier 1 suppliers
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Exemplary Corporate Citizenship Infrastructure Renewal
Infrastructure serves as a vital pillar for rural revitalization. In 2025, Longcheer continued its targeted investment in
Empowering Rural Development through rural infrastructure projects, carrying out facility renovation and improvement works in multiple locations including
Guangdong and Yunnan, with a total investment of 100,000 RMB, benefiting over 1,900 local residents.
Ecosystem Initiatives
In Xiqun Village, Henghe Town, Boluo County, Huizhou City, we implemented
The company actively responds to national initiatives, continuously allocating resources to support rural revitalization. a village road lighting project, installing 25 new streetlights to practically
Through multi-dimensional measures such as educational assistance, ecological conservation, and infrastructure improve nighttime travel conditions for villagers.
improvement, we provide practical support for the comprehensive development of rural areas, injecting sustained
momentum into rural revitalization.
Empowerment through Education At Taiping Primary School in Taiping Town, Shidian County, Yunnan, the Certificate of Donation for
Huizhou Boluo Streetlights
company aided in the construction of a rain shelter for the school canteen,
effectively improving campus supporting facilities and contributing to the
The company maintains long-term focus and continuous investment in educational public welfare, committed to enhancement of the rural educational environment.
supporting rural revitalization and talent cultivation through educational empowerment.
In terms of basic education support, the company focuses on improving educational
resources in rural areas and helping enhance the quality of rural education. For three
Rain Shelter at Taiping Primary
consecutive years, the company has carried out a refurbished computer donation School in Shidian County
Public Welfare and Livelihood
program in the eastern, western, and northern regions of Guangdong Province. In 2025,
it donated 78 units of teaching equipment, helping multiple rural schools establish
computer labs, promoting the development of educational informatization in rural
areas, and effectively increasing the rate of computer course offerings and teaching
quality in rural schools.
Support
Ecological Revitalization
Certificate of Saxaul Tree
Donation for Alxa Centered on the three pillars of social charity, volunteer services, and care for vulnerable groups, Longcheer continuously
carries out diverse social contribution activities. In 2025, these initiatives benefited a total of 255 individuals, effectively
conveying the warmth of the company and fulfilling our social responsibilities.
Actively responding to the call for ecological civilization construction, Longcheer deeply
Public Welfare
participates in the coordinated development of ecological conservation and rural
revitalization. We continuously rely on the public welfare project "10 Yuan to Green the
Alxa Desert," utilizing large-scale artificial afforestation to assist in desertification control
and ecological restoration. In 2025, we secured the planting of 5,000 Saxaul trees in the
Alxa region of Inner Mongolia, planning to complete the planting in the spring of 2026. Longcheer Alxa Corporate In 2025, the company partnered with the Hongmei Subdistrict Community in Shanghai to organize a themed event,
This initiative promotes a positive interaction between ecological conservation and Forest Signage "Wrapping Wontons for the New Year." We delivered holiday gifts to elderly community members, fostering a warm and
rural industrial revitalization, practicing corporate social responsibility through concrete harmonious atmosphere for the Spring Festival, and strengthening the positive interactive relationship between the
actions and contributing to the green and sustainable development of the region. company and the local community.
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In 2025, the company provided targeted assistance
to two children in need suffering from serious
Volunteering Services
illnesses through the Nanchang Youth Development
Foundation, thus continuously upholding the In 2025, Longcheer jointly organized a public welfare
company's tradition of public welfare in medical aid. activity titled "Bringing Warmth in the Cold Winter" with the
Furthermore, the company donated 20,000 RMB to the Police Station of Nanchang High-tech Zone's Photovoltaic
Nanchang Charity Federation, specifically designated Industrial Park. We visited Louchang Village and
to support public welfare initiatives such as aiding Zhongshang Village to deliver Spring Festival greetings to
students, the elderly, those in difficulty, and children, people in need. Employee volunteers actively participated,
thereby contributing to the development of regional assisting in the transportation of daily necessities such as
livelihood endeavors. rice, cooking oil, and nuts, conveying warmth and care
through concrete actions.
Targeted assistance to Donation to Nanchang Nanchang High-tech Zone "Bringing Warmth in
Care for Vulnerable Groups
children with serious Charity Federation: the Cold Winter" Campaign
Hongmei Subdistrict "Wrapping Wontons for the illnesses in difficult
New Year" Event circumstances:
Committee of the Chinese People's Political Consultative Conference. Relying on the "Good People Enjoy Water"
charity project for autism assistance, we purchased and donated 100 cases of charity water. The funds raised are
exclusively dedicated to supporting the development of Minhang District's assistance system for individuals with
autism, providing living care and educational support for these "children of the stars," and promoting the social
integration of vulnerable groups.
Certificate of Donation to Certificate of Donation to Nanchang Charity
Nanchang Youth Development Foundation Federation
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ESG Key Performance Indicator ESG Indicator
Proportion of Scope 3 Emission Sources Identified6
Unit 2025
ESG Indicators Purchased Goods and Services
Capital Goods
%
%
Fuel- and Energy-related Activities % 1.20
ESG Indicator Unit 2025
Upstream Transportation and Distribution % 1.53
A Environmental3
Waste Generated in Operations % 0.06
Greenhouse Gas Emissions 4
Business Travel % 0.16
Scope 1: Direct Greenhouse Gas Emissions5 tCO2e 4,463.16
Employee Commuting % 0.21
Scope 2 Greenhouse Gas Emissions (Market-Based) tCO2e 95,954.13
Upstream Leased Assets % 0.17
Scope 2 Greenhouse Gas Emissions (Location-Based) tCO2e 101,797.9
Downstream leased assets % 0.27
Scope 3: Other Indirect Greenhouse Gas Emissions tCO2e 1,518,920.28
Scope 1 Emissions as a Percentage of Total Emissions % 0.28
Of which: Total Scope 3 Upstream Emissions tCO2e 1,514,883.06
Scope 2（Market-Based）as a Percentage of Total Emissions % 5.93
Total Scope 3 Downstream Emissions tCO2e 4,037.22
Scope 3 Emissions as a Percentage of Total Emissions % 93.80
Scope 3 Emission Categories Identified and Accounted for:
Energy Consumption
Purchased Goods and Services tCO2e 1,461,472.18
Gasoline Consumption liter 46,374.02
Capital Goods tCO2e 2,868.34
Diesel Consumption liter 9,353.48
Fuel- and Energy-related Activities tCO2e 18,279.25
Natural Gas Consumption 10,000 m? 12.23
Upstream Transportation and Distribution tCO2e 23,225.77
Total Direct Energy Consumption kWh 1,707,404.39
Waste Generated in Operations tCO2e 863.49
Direct Energy Intensity kWh per million of operating revenue 40.35
Business Travel tCO2e 2,391.53
Purchased Grid Electricity kWh 210,106,574.20
Employee Commuting tCO2e 3,197.04
Indirect Energy Consumption kWh 210,106,574.20
Upstream Leased Assets tCO2e 2,585.46
Indirect Energy Intensity kWh per million of operating revenue 4,987.60
Downstream leased assets tCO2e 4,037.22
Solar Power Generation kWh 3,964,268.00
Water Resource Management
Unless otherwise specified, the scope of environmental performance statistics covers the company’s three core production bases
in Huizhou, Nanchang, and Vietnam. Total Water Withdrawal tonne 1,618,133
Greenhouse gas emissions under the operational control of the verified organization, with the organizational boundary including: Municipal Water Supply tonne 1,618,133
Huizhou Manufacturing Base, Longqi Automotive, Nanchang Manufacturing Base, Vietnam Manufacturing Base, offices in mainland
China, and offices in Hong Kong and overseas. Total Water Consumption tonne 323,626.60
Calculation formula: Activity data × Emission factor × GWP value
Scope 3 emission source percentage data is retained to two decimal places Production Water Consumption tonne 155,340.77
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ESG Indicator Unit 2025 ESG Indicator Unit 2025
Domestic Water Consumption tonne 168,285.83 B Social
Total Water Recycled tonne 28,607 Employee Profile
Water Recycling Rate % 1.77 Global total of direct employees Person 18,655
Including, by employment type
Wastewater
Total Wastewater Discharge tonne 1,294,507
Full-time employees Person 18,608
Air Emissions 7
Part-time employees Person 47
Nitrogen Oxides (NOx) tonne 0.0615
Including, by gender
Sulfur Oxides (SOx) tonne 0.0008
Male employees Person 12,753
Particulate Matter (PM) tonne 0.0045
Volatile Organic Compounds (VOCs) Emissions tonne 1.59 Female employees Person 5,902
Waste Management Male employee ratio % 68.36
Total Waste Generated tonne 12,007.73 Female employee ratio % 31.64
Including, by age
Total Non-hazardous WasteTotal Non-hazardous Waste tonne 11,905.25
Non-hazardous Waste Intensity tonnes per million of operating revenue 0.28 30 and under Person 10,522
Total Hazardous Waste tonne 102.48
Hazardous Waste Intensity tonnes per million of operating revenue 0.002
Total Waste Recycled tonne 11,640.21
Over 50 Person 77
Waste Recycling Rate % 98
Including, by education
Environmental Compliance
Doctoral degree Person 7
Number of Environmental Non-compliance Incidents case 0
Amount of Fines for Major Environmental Violations RMB 10,000 0 Master's degree Person 985
Environmental Protection Investment RMB 10,000 86.63
Energy-saving Retrofit Investment RMB 10,000 132.31
Percentage of Employees Receiving Environmental Training % 100
Percentage of Sites Assessed for Environmental Risks % 100
Percentage of Operating Sites Certified to ISO 14001 % 100
Unless otherwise specified, the scope of social performance statistics is consistent with the scope of this report, i.e., the actual
Nitrogen oxides (NOx), sulfur oxides (SOx), and particulate matter (PM) are emitted from the company's own vehicles. business scope of Shanghai Longcheer Technology Co., Ltd. and its subsidiaries, which aligns with the company's annual
The statistical scope for this year includes newly added municipal solid waste data compared with the previous year, and the report.
relevant indicators have been adjusted accordingly.
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ESG Indicator Unit 2025 ESG Indicator Unit 2025
Bachelor's degree Person 5,104 Including, by gender
Associate degree and below Person 12,559 Male employees Person 6,261
Including, by function Female employees Person 2,978
Production employees Person 11,531 Number of hires through employee referrals Person 2,291
Sales employees Person 122 Number of internal transfers Person 85
R&D and technical employees Person 5,577 Annual Employee Turnover Rate % 29.01
Finance employees Person 141 Including, by gender
Administrative employees Person 1,284 Male employees % 28.61
Including, by region Female employees % 29.89
China (including Hong Kong, Macao, Taiwan) Person 17,794 Including, by age
Outside China Person 861 30 and under % 37.15
Including, by management level 31-40 % 20.58
Female senior management Person 7 41-50 % 10.84
Male senior management Person 44 Over 50 % 5.19
Female executive management Person 115 Mainland China % 27.47
Male executive management Person 517 Diversity and Inclusion
Total new hires Person 9,239 Percentage of Women in Junior Management % 23.80
Including, by region Percentage of Women in Executive Management % 18.20
China (including Hong Kong, Macao, Taiwan) Person 8,523 Percentage of Women in Senior Management % 13.73
Outside China Person 716 Percentage of Women in Revenue-generating Functions % 53.28
Including, by age Percentage of Women in R&D and Technical Roles % 22.47
To ensure consistency and comparability of the statistical methodology, the employee turnover rate indicator covers all
employees of the company (including overseas employees), and the employee turnover rate by region is based on data from
Over 50 Person 24 mainland China.
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ESG Indicator Unit 2025 ESG Indicator Unit 2025
Number of ethnic minority employees Person 1,453 Number of severe work-related injuries Person 0
Percentage of Employees from Minority or Underrepresented Percentage of severe work-related injuries % 0
% 8.53
Groups
Work Injury Insurance Investment RMB 10,000 77.3
Employee Compensation
Work Injury Insurance Coverage % 100
Total Remuneration of General Manager RMB 10,000 274.61
Number of recordable work-related injuries Person 14
Annual Performance Appraisal Coverage % 92.7
Percentage of recordable work-related injuries % 0.07
Employee Benefits and Protection
Total lost work hours due to injuries Hours 819
Investment in Employee Commercial Insurance RMB 10,000 289.04
Safety drills conducted Times 70
Labor Contract Signing Rate % 100
Safety training sessions held Times 1,224
Social Insurance Coverage % 100
Employees participating in safety training Person 18,655
Occupational Health Examination Coverage % 100
Employee safety training coverage rate % 100
Occupational Health and Safety
Proportion of Worksites Having Undergone Employee Health
% 100
Number of work-related fatalities per year over the past three years (including the reporting year): and Safety Risk Assessments
Number of work-related fatalities in 2023 Person 0 Percentage of worksites with completed health & safety risk
% 100
assessments12
Number of work-related fatalities in 2024 Person 0
Percentage of operational facilities with ISO 45001
% 100
Number of work-related fatalities in 2025 Person 0 certification13
Work-related fatality rate per year over the past three years (including the reporting year)11： Employee Training & Development
Persons/million working Total training participations Person-times 97,109
Work-related fatality rate in 2023 0
Including, by gender
hours
Persons/million working
Work-related fatality rate in 2024 0 Male employee training participations Person-times 66,520
hours
Persons/million working Female employee training participations Person-times 30,589
Work-related fatality rate in 2025 0
hours
Annual work-related injuries Times 14
Proportion of employees represented by a formal joint management-labor health and safety committee = Total number of
employees at sites where a health and safety committee has been established / Total number of employees across all sites.
Currently, the company has established health and safety committees at its three core manufacturing bases in Huizhou,
The fatality rate due to work-related incidents = (Number of deaths caused by work-related injuries in the year Nanchang, and Vietnam.
/ Total employee working hours in the year) × 1,000,000. 13
The company's three core manufacturing bases in Huizhou, Nanchang, and Vietnam have obtained ISO 45001 certification.
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Male employee training percentage % 68.5 Production employees Hours 252,988
Female employee training percentage % 31.5 Sales employees Hours 6,880
Including, by level R&D and technical employees Hours 226,368
Management employee Person-times 5,538 Finance employees Hours 7,056
Non-management employee Person-times 91,571 Administrative employees Hours 19,457
Including, by employee category Average training hours per employee 小时 27.50
Production employees Person-times 63,247 Including, by gender
Sales employees Person-times 860 Average training hours per male employee Hours 27.2
R&D and technical employees Person-times 28,296 Average training hours per female employee Hours 29
Finance employees Person-times 882 Including, by level
Administrative employees Person-times 3,824 Management employee Hours 29
Employee training coverage rate % 100 Non-management employee Hours 27.7
Total training hours for all employees Hours 512,749 Total new employees trained Person 9,239
Annual training expenditure RMB 10,000 622.3 New employee training sessions Times 363
Including, by gender Total training hours for new employees Hours 98,432
Total training hours for male employees Hours 351,233 Instructional hours for new employees Hours 718
Total training hours for female employees Hours 161,516
Including, by level
Management employee Hours 54,720
Non-management employee Hours 458,029
Including, by employee category
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ESG Indicator Unit 2025 ESG Indicator Unit 2025
Supplier Management Supplier safety training coverage rate14 % 100
Total number of suppliers Number 3,030 Number of suppliers audited for conflict minerals Number 160
Including, by region Philanthropy
Asia Number 2,965 Public Welfare and Rural Revitalization Investment RMB 10,000 86.86
Europe Number 14 Monetary donations RMB 10,000 86.46
North America Number 45 Monetary value of donated materials RMB 10,000 0.40
South America Number 3 Number of public welfare projects Number 22
Africa Number 1 Number of employee volunteers Person 293
Oceania Number 2 Number of volunteer participants Person-times 209
Local Procurement Ratio % 88 Volunteer service hours Hours 1,534.5
Number of New Suppliers Assessed for CSR Number 58 Number of various public welfare activities organized Number 21
Number of Existing Suppliers Assessed for CSR Number 102 Rural Revitalization
Number of Suppliers Assessed for ESG Risks Number 102 Rural revitalization investment RMB 10,000 15
Of which, number of Tier 1 suppliers that have undergone ESG Monetary value of materials donated for rural revitalization RMB 10,000 1.06
Number 102
risk assessment
Of which, number of critical non-Tier 1 suppliers that have Number of people benefited from rural revitalization Person 1,978
Number 0
undergone ESG risk assessment
Innovation & R&D
% 100 Total global authorized patents Pcs. 770
Social Responsibility Agreement
Percentage of Target Suppliers Assessed for CSR % 100 Including, by patent type
Annual number of supplier ESG/CSR training sessions held Number 1 Authorized invention patents Pcs. 177
Number of suppliers participating in CSR training Number 337 Authorized utility model patents Pcs. 484
Annual violation rate of supplier CSR red lines % 0 Authorized design patents Pcs. 109
Number of participants in supplier safety training Person-times 3,068
The statistical scope covers on-site suppliers.
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ESG Indicator Unit 2025 ESG Indicator Unit 2025
Number of invention patents applied to the core business Pcs. 172 C Corporate Governance15
Valid patents per million revenue Pcs. 0.02
Board Composition
Newly authorized patents Pcs. 55
Number of directors Person 7
New patent applications Pcs. 192
Including, by gender
Accumulated software copyrights Pcs. 464
Male directors Person 5
Accumulated trademarks Pcs. 47
Annual R&D investment RMB 10,000 271,516.61 Female directors Person 2
R&D investment as % of revenue % 6.45 Including, by age
Product & Service Quality
Annual customer audits received session Times 93
Over 50 Person 5
Number of external quality system audits conducted annually Times 37
Average tenure of board members Year 6
Number of external quality system audits passed annually Times 37
Average attendance rate at board meetings % 100
First-time pass rate of external quality system audits % 100
Total number of customer complaints regarding products and Number of independent directors Person 3
Pcs. 85
services
Percentage processed in a timely manner and closed on Proportion of independent directors % 43
% 95
schedule – Domestic
Proportion of independent directors with tenure exceeding 6
Percentage processed in a timely manner and closed on % 0
% 90 years
schedule – International
Proportion of independent directors serving on more than 3
% 0
Number of customer complaints closed Pcs. 85 listed company boards
Proportion of independent directors on the audit committee % 100
Unless otherwise specified, the scope of corporate governance performance statistics is consistent with that
of this report, i.e., the actual business scope of Shanghai Longcheer Technology Co., Ltd. and its subsidiaries,
which aligns with the Company’s annual report.
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Proportion of independent directors on the remuneration
% 100 Total number of participants in business ethics training Person-times 7,499
committee
Cycle for completing audits of all operational entities of the
Proportion of independent directors on the nomination Month 12
% 66.67 company
committee
Annual business ethics training coverage rate % 98.69
Anti-corruption and Anti-bribery
Number of corruption-related litigation cases initiated and Data Security and Customer Privacy Protection
Pcs. 0
concluded by the company
Number of major data security incidents Pcs. 0
Number of corruption litigation cases initiated and concluded
Pcs. 0
by employees Number of privacy leakage incidents Pcs. 0
Number of company employees sentenced by effective court
Person 2 Percentage of all operational sites with a certified
judgments for occupational crimes
information security management system (e.g., ISO % 100
Number of reports generated by the anti-corruption
Pcs. 32 27001)16
whistleblowing procedure
Percentage of senior executives to whom anti-corruption
% 100
policies and procedures have been communicated
Percentage of employees (excluding senior executives) to
whom anti-corruption policies and procedures have been % 100
communicated
Percentage of suppliers to whom anti-corruption policies and
% 100
procedures have been communicated
Number of anti-bribery due diligence and monitoring
exercises conducted on business partners (including Times 1
intermediaries)
Total number of anti-corruption and commercial bribery
Times 1
training sessions for employees
Total number of anti-corruption and commercial bribery training
Times 1
sessions for directors/senior executives
The company’s three core manufacturing bases in Huizhou, Nanchang, and Vietnam have obtained ISO 27001
certification.
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Sustainability Information Disclosure Index
Guidelines No. 14 of Shanghai Stock Exchange for Self-Regulation of Listed Companies—Sustainability
Report (Trial) Index
Terms and Disclosure Terms and Disclosure Terms and Disclosure
Article Location Article Location Article Location
Contents Contents Contents
Chapter 1 General Provisions Article 18 (1) Article 24 Tackling the Climate Change
Chapter 2 Framework for Sustainable Development Information Disclosure Article 18 (2) Article 25 (1) ESG Key Performance Indicator
Article 11 Article 18 (3) ESG Strategy and Mechanism Article 25 (2) ESG Key Performance Indicator
Article 12 (1) Article 18 (4) Section 1 Article 25 (3) ESG Key Performance Indicator
Tackle Climate Change
Article 12 (2) Article 19 Article 26 ESG Key Performance Indicator
Article 12 (3) Chapter 3 Environmental Information Disclosure Article 27 Tackling the Climate Change
Article 12 (4) Tackling the Climate Tackling the Climate Change,
Article 28
Article 20 Change,Mitigating Practicing the Circular Economy
Article 12 (5) Environmental Impact
Article 29
Article 13 Article 21
Article 30 (1)
Article 14 (1) ESG Strategy and Mechanism Article 22 (1)
Article 30 (2)
Article 14 (2) Article 22 (2)
Article 30 (3)
Section 1 Article 22 (3) Section 2
Article 15 (1) Tackle Climate Change Pollution Prevention and Article 30 (4) Mitigating Environmental Impact
Article 15 (2) Article 23 (1) Tackling the Climate Change Ecosystem Protection
Article 30 (5)
Article 15 (3) Article 23 (2)
Article 31 (1)
Article 16 (1) Article 23 (3)
Article 31 (2)
Article 16 (2) Article 23 (4)
Article 31 (3)
Article 17 Article 23 (5)
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Terms and Disclosure Terms and Disclosure Terms and Disclosure
Article Location Article Location Article Location
Contents Contents Contents
Article 32 (1) Article 39 (2) Advancing a People-Centric
Article 49
Section 1 Philosophy
Article 32 (2) Rural Revitalization and Article 39 (3) Exemplary Corporate Citizenship Advancing a People-Centric
Social Contributions Article 50 (1)
Section 4 Philosophy
Article 32 (3) Article 40
Employees Advancing a People-Centric
Article 50 (2)
Section 2 Article 32 (4) Article 41 Philosophy
Pollution Prevention and Mitigating Environmental Impact Advancing a People-Centric
Ecosystem Protection Article 32 (5) Article 42 (1) Article 50 (3)
Philosophy
Article 33 (1) Article 42 (2) Chapter 5 Information Disclosure Related to Sustainable Development
Governance
Article 33 (2) Section 2 Article 42 (3)
ESG Strategy and Management,
Innovation-Driven and Creating Satisfied Customers
Article 51 Standardize corporate
Article 33 (3) Scientific Ethics Article 43 (1)
Section 1 governance
Mitigating Environmental Sustainable
Article 43 (2) Article 52 Advancing Responsible Sourcing
Article 34 Impact, Practicing the Circular Development
Economy Article 43 (3) Governance
Mechanisms Article 53 (1) Dual-Materiality Analysis
Article 35 (1) Article 43 (4) Article 53 (2) Dual-Materiality Analysis
Article 35 (2) Creating Satisfied Customers,
Article 44 Article 54
Advancing Responsible Sourcing
Article 35 (3)
Section 3 Article 45 (1) Advancing Responsible Sourcing Article 55 (1)
Resource Utilization and Article 36 (1) Mitigating Environmental Impact
Circular Economy Article 45 (2) Advancing Responsible Sourcing Article 55 (2)
Article 36 (2) Section 2 Strengthening Compliance
Article 46 —— Article 55 (3)
Business Conduct Management
Article 37 (1)
Article 47 (1) Creating Satisfied Customers Article 55 (4)
Article 37 (2)
Section 3 Article 47 (2) Creating Satisfied Customers Article 56 (1)
Mitigating Environmental Suppliers and
Article 37 (3) Impact, Practicing the Circular Customers Article 47 (3) Creating Satisfied Customers Article 56 (2)
Economy
Article 47 (4) Creating Satisfied Customers Chapter 6 Supplementary Provisions and Interpretations
Chapter 4 Social Information Disclosure
Article 48 (1) Strengthening Data Security Article 57 Index Table
Section 1 Article 38
Rural Revitalization and Exemplary Corporate Citizenship Independent Assurance
Article 48 (2) Strengthening Data Security Article 58
Social Contributions Article 39 (1) Statement
Article 48 (3) Strengthening Data Security
Article 48 (4) Strengthening Data Security
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Appendix C2 Environmental, Social and Governance Reporting Code Index
Mandatory Disclosure Items Location Category Aspect Comply-or-Explain Location
Advancing a People-Centric
General Disclosure Information
Governance Structure ESG Strategy and Management
Philosophy
B1：Employment
Reporting Principles About This Report
KPI B1.1 ESG Key Performance Indicator
Reporting Boundary About This Report
KPI B1.2 ESG Key Performance Indicator
Advancing a People-Centric
General Disclosure Information
Philosophy
Category Aspect Comply-or-Explain Location
KPI B2.1 ESG Key Performance Indicator
Tackling the Climate Change, B2：Health and
General Disclosure Information
Mitigating Environmental Impact Safety
KPI B2.2 ESG Key Performance Indicator
KPI A1.1 ESG Key Performance Indicator
Employment Advancing a People-Centric
KPI B2.3
Social and Labor Philosophy
KPI A1.3 ESG Key Performance Indicator
A1： Emissions Practices
Advancing a People-Centric
General Disclosure Information
KPI A1.4 ESG Key Performance Indicator Philosophy
B3：Development
KPI A1.5 Tackling the Climate Change and Training KPI B3.1 ESG Key Performance Indicator
KPI A1.6 Mitigating Environmental Impact KPI B3.2 ESG Key Performance Indicator
Tackling the Climate Change， Advancing a People-Centric
General Disclosure Information General Disclosure Information
Mitigating Environmental Impact Philosophy
Environmental
B4：Labor Advancing a People-Centric
KPI A2.1 ESG Key Performance Indicator KPI B4.1
Standards Philosophy
KPI A2.2 ESG Key Performance Indicator Advancing a People-Centric
A2：Use of Resources KPI B4.2
Philosophy
KPI A2.3 Tackling the Climate Change
KPI A2.4 Mitigating Environmental Impact
KPI A2.5 ESG Key Performance Indicator
General Disclosure Information Mitigating Environmental Impact
A3： The Environment and
Natural Resources
KPI A3.1 Mitigating Environmental Impact
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Category Aspect Comply-or-Explain Location Category Aspect Comply-or-Explain Location
General Disclosure Information Advancing Responsible Sourcing (I) Governance 应对气候变化
KPI B5.1 ESG Key Performance Indicator Climate-Related Risks and
Tackling the Climate Change
Opportunities
B5：Supply Chain
KPI B5.2 ESG Key Performance Indicator
Management Business Model and Value Chain Tackling the Climate Change
KPI B5.3 ESG Key Performance Indicator
(II) Strategy Strategy and Decision-Making Tackling the Climate Change
KPI B5.4 ESG Key Performance Indicator Financial Position, Financial
Tackling the Climate Change
Performance, and Cash Flows
General Disclosure Information Creating Satisfied Customers
Climate Resilience Tackling the Climate Change
KPI B6.1 ESG Key Performance Indicator
(III) Risk Management
KPI B6.2 Creating Satisfied Customers
Operating B6：Product
Greenhouse Gas Emissions Tackling the Climate Change
Practices Responsibility Climate-related Disclosures
KPI B6.3 Creating Satisfied Customers
Climate-Related Transition Risks Tackling the Climate Change
Social KPI B6.4 Creating Satisfied Customers
Climate-Related Physical Risks Tackling the Climate Change
KPI B6.5 Strengthening Data Security
Climate-Related Opportunities Tackling the Climate Change
Strengthening Compliance Internal Carbon
General Disclosure Information
Management Pricing Capital Management Tackling the Climate Change
Strengthening Compliance Compensation
KPI B7.1 Internal Carbon Pricing /
B7：Anti- Management
corruption Strengthening Compliance
KPI B7.2 Compensation /
Management
Strengthening Compliance Industry Metrics /
KPI B7.3
Management
Climate-Related Targets Tackling the Climate Change
General Disclosure Information Exemplary Corporate Citizenship
B8：Community
Community KPI B8.1 Exemplary Corporate Citizenship
Investment
KPI B8.2 Exemplary Corporate Citizenship
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GRI Index GRI Standards Disclosure Item Location
Shanghai Longcheer Technology Co., Ltd. has reported the information referenced in this GRI Content
Usage Guidelines
Index in accordance with the GRI Standards for the period from January 1, 2025 to December 31, 2025.
Standards
Reference
Message from the Chairman, ESG Strategy and
GRI Standards Disclosure Item Location
Management
Strengthening Compliance Management, Advancing
GRI 2： Responsible Sourcing
GRI 2： 2-30 /
General Disclosures 2-9 Standardize corporate governance
Material Topics 2021
Biodiversity 2024
GRI 102：
Climate Change 2025
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GRI Standards Disclosure Item Location GRI Standards Disclosure Item Location
Anti competitive Behavior 2016
GRI 102： GRI 207：
Climate Change 2025 207-3 Dual-Materiality Analysis
Mitigating Environmental Impact
GRI 301： Mitigating Environmental Impact
Materials 2016 Practicing the Circular Economy
GRI 103: 301-3
Practicing the Circular Economy
Energy 2025
Water and Effluents 2018
GRI 201: 303-4 ESG Key Performance Indicator
Economic Performance 2016
GRI 202： 202-1 /
Market Presence 305-2 ESG Key Performance Indicator
GRI 305：
GRI 203： 203-1 Exemplary Corporate Citizenship Emissions 2016
Indirect Economic Impacts 305-4 ESG Key Performance Indicator
GRI 204：
Procurement Practices 2016
GRI 205： GRI 305：
Anti corruption 2016 Emissions 2016
GRI 205：
Anti corruption 2016
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GRI Standards Disclosure Item Location GRI Standards Disclosure Item Location
GRI 405：
Diversity and Equal Opportunity 2016
GRI 306： GRI 406：
Waste 2020 Non discrimination 2016
Freedom of Association and Collective 407-1 /
Bargaining 2016
GRI 308：
Supplier Environmental Assessment 2016 Child Labor 2016
GRI 409：
GRI 401： GRI 410:
Employment 2016 Security Practices 2016
GRI 402： Rights of Indigenous Peoples 2016
Labor/ Management Relations 2016 413-1 Exemplary Corporate Citizenship
GRI 413：
GRI 403： 403-1 Advancing a People-Centric Philosophy Local Communities 2016
Occupational Health and Safety 2018
GRI 414：
Public Policy 2016
GRI 416：
GRI 404： 403-6 Advancing a People-Centric Philosophy
Customer Health and Safety 2016
Training and Education 2016
GRI 417：
GRI 418：
GRI 404：
Training and Education 2016
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Statement of the Board of Directors
Sustainability serves as the cornerstone of Longcheer's commitment to long-termism. As a premier service The preparation of this report strictly adheres to the principles of Materiality, Quantification, and Consistency:
provider for R&D and manufacturing of smart products, it represents our relentless pursuit of co-creating
value with our customers and partners. Since our inception, we have integrated Environmental, Social, and Materiality: Through stakeholder engagement and expert assessments, we have systematically identified and
Governance (ESG) principles into the entire lifecycle of product design, manufacturing, and operations. This screened ESG issues that significantly impact our business operations and stakeholders. We focus our disclosure
report systematically showcases our achievements in green manufacturing, technological innovation, supply on key areas such as climate change, data security and customer privacy protection, product and service safety
chain collaboration, and corporate governance, continuously strengthening the trust of all stakeholders in and quality, innovation-driven development, and employee health and safety. This ensures the report addresses
Longcheer Technology. substantive issues and responds to the concerns of all parties.
As the highest decision-making and supervisory body for sustainability management, the Board of Directors Quantification: We strive to present environmental, social, and governance performance using quantifiable
dynamically reviews the risks and opportunities we face regarding ESG factors, taking into account domestic metrics wherever possible. Key data points include energy consumption intensity, carbon emission data, waste
and international environmental shifts and the materiality of ESG issues. The Board approves and oversees the discharge volume, employee training coverage, and safety production indicators. These are accompanied by
implementation of our sustainability strategy, reviews annual priorities, and ensures the synergistic allocation of explanations of calculation methodologies and statistical scopes to facilitate vertical comparison and trend
resources to align the entire organization towards common goals. analysis for stakeholders.
To advance sustainability initiatives more effectively, Longcheer has established the Strategy & ESG Committee. Consistency: The statistical methods, disclosure scopes, and calculation standards adopted in this report remain
This specialized body, operating under the Board, is responsible for researching, discussing, and providing consistent with previous periods. Any changes that may affect data comparability are fully explained to ensure
decision support on the Company's long-term development strategy and ESG-related matters. In 2025, comparability across reporting periods and years, providing a reliable basis for stakeholders to objectively assess
we appointed a Chief Sustainability Officer (CSO) who reports directly to the Board and the Strategy & ESG the Company's ESG performance.
Committee. The CSO oversees strategic planning, compliance and risk control, operational integration, and
performance monitoring to ensure the effective realization of sustainability goals. Furthermore, an ESG To guarantee the authenticity and transparency of the data in this report, the Company engaged T?V Rheinland
Execution Working Group, comprising members from various functions and manufacturing bases, serves as the (Shanghai) Co., Ltd. to conduct an independent third-party assurance. The assurance process strictly followed
implementation arm. This group is responsible for formulating ESG strategies, daily management, and on-the- the AA1000 Assurance Standard and was executed with reference to relevant guidelines, including Appendix C2
ground execution, providing robust support for the Company's major sustainability decisions. (ESG Reporting Guide) of the Listing Rules of The Stock Exchange of Hong Kong Limited and the Shanghai Stock
Exchange's "Self-Regulatory Guidance No. 14 — Sustainable Development Report (Trial)." This report has been
reviewed and approved by the Company's Board of Directors and is hereby released.
Looking ahead, we will continue to deepen our sustainability strategy and maintain active, candid
communication with all stakeholders, working together with a sense of responsibility to co-create a sustainable
future in the era of intelligence.
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Independent Assurance Statement
Introduction Assurance Criteria
T?V Rheinland (Shanghai) Co., Ltd., a member of T?V Rheinland Group (hereinafter "T?V Rheinland" or "We"), The following assessment criteria (including reporting frameworks or standards) were also used in undertaking
was entrusted by Shanghai Longcheer Technology Co., Ltd. (hereinafter "Longcheer" or "the Company") to the work:
conduct an independent third-party assurance of the 2025 Environmental, Social and Corporate Governance Shanghai Stock Exchange Guidelines for Self-Regulatory Listings of Shanghai Stock Exchange No. 14 -
Report (hereinafter, "Report"). The Report disclosed Longcheer's sustainability information for the fiscal year Sustainable Development Report (Trial)
Responsibilities
No. 4 - Preparation of Sustainability Reports
Appendix C2 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited
Longcheer is not only responsible for the preparation of ESG report and the collection and reporting of Environmental, Social and Governance Reporting Code
sustainability information in accordance with applicable reporting standards but also has the obligation to
Global Sustainability Standards Board (GSSB) Sustainability Reporting Standards (GRI Standards)
implement and maintain effective internal control of information and data to support the report compilation
process. United Nations 2030 Sustainable Development Goals (SDGs)
Adherence to the AA1000AP AccountAbility Principles, i.e., Inclusivity, Materiality, Responsiveness, and
T?V Rheinland implements sustainability information assurance activities under a quality management Impact
system that complies with the requirements of the ISO/IEC 17029:2019 Standard and adheres to the T?V
Rheinland Global Code of Ethics and Compliance Program. Our assurance service follows the principles of Methodology
independence and impartiality and does not participate in the preparation of the Report of Longcheer. The
Our assurance activities and procedures include:
assurance project was implemented by a team with expertise and assurance experience in the corresponding
Inquiring management to understand the company's business and reporting processes, including
sustainability issues. The role of T?V Rheinland is to carry out independent assurance work in accordance with
sustainability strategy, philosophy and management.
the assurance agreement and the agreed scope of assurance work, and to make independent and impartial
professional judgments on sustainability reporting. Interviewing relevant executive personnel in key functions to understand and assess the processes, systems
and controls related to sustainability management, including key management procedures, stakeholder
Assurance Standard engagement processes, topic materiality assessment processes, impact assessments, etc.
T?V Rheinland undertook assurance work for the sustainability information disclosed in the Report of Assessing available performance information based on sampling principles and document review.
Longcheer in accordance with the AccountAbility AA1000 Assurance Standard v3 (AA1000AS v3), Type 1 and Collecting and inspecting supporting evidence to assess the extent to which relevant disclosures within
Moderate level. the scope of the assurance engagement and sustainability reporting support and adherence to AA1000AP
Assurance Objectives
assurance principles.
Reporting assurance observations or recommendations to give the Company's management an opportunity
The purpose of the assurance was to provide management of Longcheer, and stakeholders concerned with the to correct errors before the assurance process is completed.
company's sustainability information and performance with an independent view of the assurance, including
that we review and assess the content of the report adherence to the AA1000AP (2018) Assurance Principles
(including inclusivity, materiality, responsiveness and impact).
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Limitations Materiality
T?V Rheinland planned and executed the verification in accordance with the scope of the assurance agreed Longcheer employed a double materiality analysis process, which covered financial materiality and impact
upon and obtained evidence information and necessary explanations to provide the basis for the conclusion materiality, and identified and confirmed the annual materiality issue matrix through stakeholder research,
of the assurance in accordance with the moderate level of AA1000AS v3. The nature and extent (scope) of the peer benchmarking, and industry trend analysis. The issue matrix clearly revealed highly material issues (such
procedures involved in moderate level assurance engagement are lower than those required to obtain high as data security and customer privacy protection, product and service safety and quality, climate change
level assurance. response, employee health and safety, etc.), and the final issue matrix is reviewed and confirmed by the
Strategy and ESG Committee.
Forward-looking information relates to events and actions that have not yet occurred and may never occur.
Actual results are likely to be different because expected events often do not occur as expected. We did not Responsiveness
guarantee the availability of forward-looking information.
The communication channels between Longcheer and its main stakeholder groups are diverse, usually
The information and performance relating to the assurance is limited to the disclosure of the contents of this including employee satisfaction surveys, supplier training and review, grievance and reporting mechanisms,
Report. Our assurance work did not include financial report and its financial data, as well as other information etc. The Company has established a systematic management framework (governance - strategy - risk
not related to the subject matters of sustainability and beyond the scope of the assurance. management - indicators and objectives) for double materiality issues, set goals and disclosed the progress
of management actions and quantitative targets. The Report also disclosed a large amount of quantitative
Conclusions data on key ESG performance indicators (such as greenhouse gas emissions, energy consumption, employee
data, occupational health and safety, supplier management, etc.) to actively respond to the major concerns of
Based on the above assurance procedures and methodology performed and the evidence obtained, we
stakeholders.
conclude that there are no instances or information that would be contrary to the following statements:
Impact
Longcheer's 2025 ESG Report and its contents are in adherence to the AA1000AP AccountAbility Principles.
Evidence of the use of relevant processes, systems and controls, and available performance information have Evidence showed that Longcheer attached great importance to ESG risk management (including risk
been reviewed and assessed, and can reflect sustainability practices of the Company. identification, risk warning, risk response, etc.), and paid attention to the company's own operational impact
and value chain impact. The Company analysed and managed the risks and opportunities of important issues
T?V Rheinland shall not bear any liability or responsibility to a third party for perception and decision on (such as climate change, product innovation, supplier management, etc.), and the core data disclosure of the
Longcheer based on this Assurance Statement. KPI table also provided data support for assessing and measuring environmental and social impacts.
Adherence to the AA1000AP AccountAbility Principles
Inclusivity
Longcheer has identified seven major stakeholders, including shareholders, capital markets, customers,
Daniel Pan
employees, suppliers, communities and social organizations, etc., and has established a relatively
Technical Manager of Corporate Sustainability Services
comprehensive communication mechanism. The Company conducted a stakeholder questionnaire survey on
ESG issues and provided a reference for management decision-making and double materiality assessment T?V Rheinland (Shanghai) Co., Ltd
through analysis of research feedback.
Shanghai, China, 25 March 2026
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